milosz wrote:Interesting that some blame regulatory capture on the FDA/EPA/etc. itself, rather than the (subsidized) industries that sought capture in the first place.
They are one and the same. Regulations & subsidies are the twin rewards for the political connected and those handing out political favors. The losers are politically unconnected businesses (almost always small or medium sized businesses) and the consumer.
Politicians love regulations, because they then can sell relief from the same regulations. Crony Capitalists (Big Business and Big Labor) also love regulations, because it keeps out completion, keeps prices high and profits stable.
Politicians love subsidies, because it allows them to buy votes, makes them rich and allows them to pick winners and losers. Crony capitalist love subsidies because they are easily purchased from politicians, it takes away any incentive to make any real profit, eliminate the need to deliver better goods or services, gives them an advantage over competitors or competing industries/technology and they can be purchased from politicians to offset regulations.
Regulations are not bad in and of themselves. It's the absence of rule of law and equality before the law that is the problem. Politicians enact regulations and then almost immediately carve out exceptions for themselves, their allies and those willing to buy relief. If you aren't in the elite inner circle, politically connected, or able to pay off government; you are fucked.