Interesting article on the concentration of power in DC and its magnetic affect on businesses. This centralization of power in Washington is not what the founders envisioned. Power and money flowing through the hands of so few is never a good thing.

http://www.cnn.com/2010/OPINION/01/12/frum.washington.financial.capital/index.html

Washington DC is booming.

The Wall Street Journal reported Friday that office rents in Washington are poised to overtake rents in New York City. Washington now boasts the lowest office vacancy rate in the nation.

New York City is bleeding jobs, unemployment is over 10 percent. Washington is booming as government agencies like TARP and the General Services Administration expand.

The founders selection of DC's geographical location gives us a glimpse of their vision or the federal government's role.

The Constitution of the new republic provided for an autonomous federal district. It did not specify where that district should be. Mexico and Argentina both have federal districts that coincide with their greatest cities, and that option was at least theoretically available to the United States as well. Instead, the capital was sited on the swampy banks of the Potomac, far from the great commercial centers of the founding era: Boston, New York, Philadelphia and Charleston.

This decision had profound effects for the first 150 years of the new country's life. If a business leader wanted to talk to a member of Congress or the Cabinet, he had to take a long train ride, often a very long train ride. Simpler and easier to leave the job to a lobbyist. Sheer physical distance interposed itself much of the time between the country's financial, business, and political leaders

My how things have changed. Washington DC is now looked to for the answers to all our problems. And the federal government will happily comply. They will promise us the sun, moon, and stars. Just print more cash.

And now the distance has vanished to nothing, and the one-time junior partner has gained the upper hand. The crisis of 2008 -- and the Great Recession of 2009 -- has interpenetrated government and finance in a way never before seen in the history of the United States. The kind of proximity to power once required only by defense contractors is suddenly required by all kinds of firms. Hilton Hotels will move from Beverly Hills to Washington. The accounting firm Deloitte will consolidate operations here, as will the legal firm McGuire Woods as it develops a new focus upon lobbying.

The Federal government is now the majority owner of the lending arm of General Motors, GMAC. It owns the nation's largest insurance company, AIG. It is banker, automaker, and lender of last, second and first resort. President Obama joked at his first White House correspondents' dinner that he had just been named Auto Executive of the Year. Who wouldn't want to lease the office next door?

And it is not enough, as they lust for evan more power. Just look at his arrogance, Kenneth Feinburg's statement below.

The Federal Reserve has acquired a portfolio of $1 trillion in mortgage securities.

The government regulates salaries in the companies in which it holds interests -- and pay czar Kenneth Feinberg has lamented in a television interview that his power does not extend even further. "The biggest disappointment, I think, is that under the statute my jurisdiction is so narrow, and so circumscribed, that I have no real direct mandatory power over other Wall Street or other national companies," he said.

But as Washington DC expands, the rest of the country shrinks. The author has it right. The opposite is what is needed. The federal government needs to be downsized. And when the talk about more regulations in DC I hope the voters here them loud and clear and do a little regulating of their own this November.

But as Washington gains, the country loses. It loses something more than its ideals of free enterprise and private ownership. It loses the very American idea of a capital as a specialized locale to which specific tasks are delegated -- not an American Versailles where favors are distributed and attendance is mandatory.