The Jungle, Regulatory Capture, and Self-Interest

[EMNofSeattle]

Costs and benefits to whom? You can only do that for yourself, it's impossible to do that for other people.

Play the role of the regulator for a minute.

I'm finishing the attic of my house, and I need to determine how much insulation to use. Since I'm in the northeast, the tighter and the more insulation I use, the lower it will cost to heat the space, which is a benefit. But insulating the space has a cost as well.

So how should I insulate the space? The regulator cannot answer this question. All he can do is to impose his own personal preferences on me by force.

I started a thread on this very topic:

A question concerning government drug safety regulation

In in recent exchange, a poster responded to me with this: Or we could regulate the medicines that companies are allowed to produce for safety and effectiveness. Seems reasonable, but let's unpack it and see what it really means. First, safety isn't binary. Something isn't safe or unsafe...

debatepolitics.com

Well the regulator can in fact answer the question, than impose significant fines on you for not complying, and even if they never take action against you, the value of your house will be lower because any sane buyer will have a building inspector go through who will tell him some crazy libertarian dude has been doing major repairs without permits and not complying with code which means they’ll have to spend money fixing your mess

 

[ttwtt78640]

What does "adequately" mean here? Insulation isn't binary, it's a continuum that goes from zero insulation to super insulated. There's no one correct spot on the spectrum. Moreover the term "cost effective" is nothing but a purely subjective judgment call based on personal preference.



So? Maybe the homeowner prefers to pay higher heating bills in order to save on construction costs. There is no right answer here, and it's wrong to imposed the regulator's personal preferences on millions of people by force. Note that even your link says "recommended" r values. Recommended by whom, and why should that person's preference override that of the homeowner?

You're in the construction business. I would bet everything I own that you have done things that are inconsistent with whichever code Texas uses. We all have, there's no way around it, and that's because having one standard for everyone is dumb.

I have to go work on my truck for a while. I'm replacing all of the ball joints and one of the lower ones will not come out of the steering knuckle. I think I'm going to have to cut it, but I can't get an angle grinder in there and it's hardened steel so even with a sawzall it's going to take forever.

The inspectors don’t write the building codes, they simply enforce them. When I’m asked to build something which doesn’t meet local building codes (which are generally enforced only if one obtains a building permit, gets sued or faces problems with their insurance company) I make the customer sign a statement stating that I was instructed to do so.

I agree that some building code items are rather arbitrary and may even vary based on what a particular ‘approved’ engineering firm ‘recommends’. That was the case for our manufactured home’s foundation, piers and tie downs. They meet (or exceed) international, national, state and county building codes, yet the city refused to certify that work and eventually, reluctantly granted us ‘conditional occupancy’.

Oddly, the developer of a 250 manufactured home community (merely a few hundred feet away from our home and also in the same city) has gained approval for meeting a different (and lower) standard than had been applied to us.

 

[eman623]

The FDA is not the reason that epipens are expensive, the epipen is expensive because it can only be produced by one company and they lobby to pass laws mandating only their product be stocked. The monopoly can only increase shareholder value by increasing price. We could decrease drug prices today by creating a nationalized pharmacy that is mandated to sell these drugs at cost, or at least threaten to if prices don’t come down.

So your solution to a regulatory monopoly is to make more regulations?

If drug makers are required to sell at cost, what is their incentive to cut the costs, or even sell them at all?

Trust the free - and I mean truly FREE - market! If we just repeal the monopolistic laws and open up the market, competition will increase supply and drive prices down.

 

[EMNofSeattle]

So your solution to a regulatory monopoly is to make more regulations?

No, it’s to propose taking over the monopoly and operating it for the public interest.

If drug makers are required to sell at cost, what is their incentive to cut the costs, or even sell them at all?

No, I said threaten the industry with nationalization if they don’t work to lower costs.

Trust the free - and I mean truly FREE - market! If we just repeal the monopolistic laws and open up the market, competition will increase supply and drive prices down.

There is no monopolistic laws, even in a free environment like the airlines after deregulation there is going to be mergers and acquisitions because oligopoly is always better than a free market from a corporate point of view

 

[EMNofSeattle]

The inspectors don’t write the building codes, they simply enforce them. When I’m asked to build something which doesn’t meet local building codes (which are generally enforced only if one obtains a building permit, gets sued or faces problems with their insurance company) I make the customer sign a statement stating that I was instructed to do so.

I agree that some building code items are rather arbitrary and may even vary based on what a particular ‘approved’ engineering firm ‘recommends’. That was the case for our manufactured home’s foundation, piers and tie downs. They meet (or exceed) international, national, state and county building codes, yet the city refused to certify that work and eventually, reluctantly granted us ‘conditional occupancy’.

Oddly, the developer of a 250 manufactured home community (merely a few hundred feet away from our home and also in the same city) has gained approval for meeting a different (and lower) standard than had been applied to us.

It’s hard to have standards that don’t seem arbitrary.

Years ago I was on a different forum and one of the members was this total libertarian guy who was a builder and insisted it was immoral that he was required to build a home with the ability to withstand a 150mph windstorm because such a storm had never happened where he was building the house, and when I pointed out that the area he specified has 60 mph windstorms every 5 to 10 years and that 150 was probably an engineered safety margin his response is “well why not build it to take a 100 or 200 mph storm?”

I dunno, because someone decided 150 was acceptable. Arbitrary? Yes, important, also yes.

 

[ttwtt78640]

The FDA is not the reason that epipens are expensive, the epipen is expensive because it can only be produced by one company and they lobby to pass laws mandating only their product be stocked. The monopoly can only increase shareholder value by increasing price. We could decrease drug prices today by creating a nationalized pharmacy that is mandated to sell these drugs at cost, or at least threaten to if prices don’t come down.

Are you kidding me? Why make, much less invest in R&D to create, any product which must be sold at cost?

 

[eman623]

No, it’s to propose taking over the monopoly and operating it for the public interest.

Yes. That's more regulation. And when did the federal government become an expert in the drug business? Where does it get the authority for this?

No, I said threaten the industry with nationalization if they don’t work to lower costs.

The carrot works better than the stick, and the free market works better than price controls.

There is no monopolistic laws, even in a free environment like the airlines after deregulation there is going to be mergers and acquisitions because oligopoly is always better than a free market from a corporate point of view

We already have anti-trust laws to deal with non-regulatory monopolies.

 

[EMNofSeattle]

Are you kidding me? Why make, much less invest in R&D to create, any product which must be sold at cost?

The biggest expenses pharma companies undertake is advertising, not research and development. And most great leaps forward in medicine came from university research and not private pharmaceutical companies. Many early medicine developers gave up their parents to ensure the medicine was widely available. There is no market reason epipens go up in price every year because that technology is decades old. Flatscreen TVs are so cheap they’re often thrown away when no longer needed, why are epipens almost 700 dollars for 2? Why are diabetics rationing insulin when that technology is a century old?

The private model is not engaging in much innovation, most of their research is slightly tweaking existing medicines so they can put new patents on it

 

[EMNofSeattle]

Yes. That's more regulation. And when did the federal government become an expert in the drug business? Where does it get the authority for this?

Article 1 of the constitution authorizing the congress to pass legislation.

The carrot works better than the stick, and the free market works better than price controls.

No, it doesn’t. You can look at the price for basic drugs like insulin and epinephrine. These are decades old technology that under normal market conditions should be getting cheaper over time. No normal consumer product goes up in price like medicine

We already have anti-trust laws to deal with non-regulatory monopolies.

We can also nationalize the industry, or at least threaten it and see if the industry wants to play ball to avoid being seized

 

[ttwtt78640]

It’s hard to have standards that don’t seem arbitrary.

Years ago I was on a different forum and one of the members was this total libertarian guy who was a builder and insisted it was immoral that he was required to build a home with the ability to withstand a 150mph windstorm because such a storm had never happened where he was building the house, and when I pointed out that the area he specified has 60 mph windstorms every 5 to 10 years and that 150 was probably an engineered safety margin his response is “well why not build it to take a 100 or 200 mph storm?”

I dunno, because someone decided 150 was acceptable. Arbitrary? Yes, important, also yes.

It’s hard (if not impossible) to respond to your anecdote without location information provided.

Building Codes for Wind Loads in Texas

In 1970, Hurricane Celia devastated the Texas coast, leading to the establishment of the Texas Windstorm Insurance Association, or TWIA, an agency of the Texas Department of Insurance. The TWIA governs the building codes, including wind load standards, for those counties along the Texas coast...

legalbeagle.com

 

[eman623]

Article 1 of the constitution authorizing the congress to pass legislation.

That's not a blank check to pass any legislation they want.

No, it doesn’t. You can look at the price for basic drugs like insulin and epinephrine. These are decades old technology that under normal market conditions should be getting cheaper over time. No normal consumer product goes up in price like medicine

So open up the free market and let it do what it's best at. Making new and Improved products while cutting costs over time.

We can also nationalize the industry, or at least threaten it and see if the industry wants to play ball to avoid being seized

That would be a huge mistake. Even single payer countries have not nationalized their drug industries.

 

[EMNofSeattle]

That's not a blank check to pass any legislation they want.

For all intents and purposes it is.

So open up the free market and let it do what it's best at. Making new and Improved products while cutting costs over time.

By doing what? You think regulatory change is going to result in massive conglomerates opening overnight with competing interests?

That would be a huge mistake. Even single payer countries have not nationalized their drug industries.

I see no evidence for the idea it would be a “mistake”. The mistake best i can see is not jailing pharma execs for murder when people die from not affording medicine. Expropriate some wealth and throw some people in jail might result in a change of attitude

 

[eman623]

For all intents and purposes it is.

Not even close.

By doing what? You think regulatory change is going to result in massive conglomerates opening overnight with competing interests?

I said "over time". Not "overnight".

I see no evidence for the idea it would be a “mistake”. The mistake best i can see is not jailing pharma execs for murder when people die from not affording medicine. Expropriate some wealth and throw some people in jail might result in a change of attitude

LOL. Great idea! We definitely need more totalitarianism and purges in our drug policies. That'll fix everything.

 

[EMNofSeattle]

Not even close.

I said "over time". Not "overnight".

LOL. Great idea! We definitely need more totalitarianism and purges in our drug policies. That'll fix everything.

That’s not totalitarianism, that’s enforcement of nobless oblige, the noble and merchant class should have obligations to the social classes below them and one of the roles of the crown is to wield the sword to enforce these.

 

[aociswundumho]

Oddly, the developer of a 250 manufactured home community (merely a few hundred feet away from our home and also in the same city) has gained approval for meeting a different (and lower) standard than had been applied to us.

Same thing with housing codes. I have some rentals in a town that requires all apartments to be inspected every two years and meet the city's housing code. But you go into the larger buildings and you'll find violations everywhere, even missing handrails, ffs. One time I was in city hall and I mentioned this glaring and corrupt double standard, and all I got was silence from the head housing inspector.

The regulatory state in every context caters to big business.

 

[aociswundumho]

Article 1 of the constitution authorizing the congress to pass legislation.

There is nothing in article 1, section 8 about regulating drugs.

No, it doesn’t. You can look at the price for basic drugs like insulin and epinephrine. These are decades old technology that under normal market conditions should be getting cheaper over time. No normal consumer product goes up in price like medicine

Yes, because of government regulation. The FDA prohibits importing insulin, and patent "evergreening" prevents competition.

We can also nationalize the industry, or at least threaten it and see if the industry wants to play ball to avoid being seized

Sounds just like something a fascist would say.

 

[aociswundumho]

Well the regulator can in fact answer the question,

Yes, but only for himself, not for other people.

than impose significant fines on you for not complying, and even if they never take action against you, the value of your house will be lower because any sane buyer will have a building inspector go through who will tell him some crazy libertarian dude has been doing major repairs without permits and not complying with code which means they’ll have to spend money fixing your mess

 

[EMNofSeattle]

There is nothing in article 1, section 8 about regulating drugs.

There doesn’t need to be, the constitution merely sets process, it doesn’t prohibit the congress from doing very much. The founders basically recreated parliament and parliament has basically dictatorial powers which are legitimized by the process

Yes, because of government regulation

Lobbied for by the industry

. The FDA prohibits importing insulin, and patent "evergreening" prevents competition.

Yeah, because the existing industry lobbied for this

Sounds just like something a fascist would say.

No one hates Hitler because he brought corporate interests under state control, that was perfectly legitimate exercise of state power, it’s the minor little issue of the massive genocide and war mongering. If you find parallels between nationalizing industries and fascism I simply don’t care

 

[ttwtt78640]

Same thing with housing codes. I have some rentals in a town that requires all apartments to be inspected every two years and meet the city's housing code. But you go into the larger buildings and you'll find violations everywhere, even missing handrails, ffs. One time I was in city hall and I mentioned this glaring and corrupt double standard, and all I got was silence from the head housing inspector.

The regulatory state in every context caters to big business.

The donor class may get treated just a tad differently.

 

[aociswundumho]

There doesn’t need to be, the constitution merely sets process, it doesn’t prohibit the congress from doing very much. The founders basically recreated parliament and parliament has basically dictatorial powers which are legitimized by the process

1. If that were true, then there wouldn't be a list of specific, enumerated powers.

2. If you were correct, then alcohol prohibition would not have required an amendment - but it did, because you're wrong.

Lobbied for by the industry

Yeah, because the existing industry lobbied for this

Of course. The true purpose of the regulatory state is to give politicians and bureaucrats favors to sell.

No one hates Hitler because he brought corporate interests under state control, that was perfectly legitimate exercise of state power,

I'm pretty sure that you believe virtually anything some shitty government does is a "perfectly legitimate exercise of state power,"

it’s the minor little issue of the massive genocide and war mongering. If you find parallels between nationalizing industries and fascism I simply don’t care

 

[EMNofSeattle]

1. If that were true, then there wouldn't be a list of specific, enumerated powers.

The enumerated powers permit the government to fully regulate all forms of commercial trade

2. If you were correct, then alcohol prohibition would not have required an amendment - but it did, because you're wrong.

It didn’t really require one, as evidenced by the fact the controlled substances act didn’t require one. The temperance movement wanted an amendment to make sure their victory didn’t get repealed by the next congress and they were strong enough to make it happen when they did

Of course. The true purpose of the regulatory state is to give politicians and bureaucrats favors to sell.

That is not the true purpose of the regulatory state, that is a tragic but unavoidable side effect of having an effective regulatory stats

I'm pretty sure that you believe virtually anything some shitty government does is a "perfectly legitimate exercise of state power,"

Not at all. There are many immoral things the government cannot do, like genocide, immoral medical expirementation, etc

I mean the government can do those things, but they are illegitimate exercises of power and ones that those leaders will be held to account to at final judgment

 

[ttwtt78640]

1. If that were true, then there wouldn't be a list of specific, enumerated powers.

Are you asserting that granting patents is not a federal power?

2. If you were correct, then alcohol prohibition would not have required an amendment - but it did, because you're wrong.

It didn’t take Constitutional amendment to ban other recreational drugs nationwide.

Of course. The true purpose of the regulatory state is to give politicians and bureaucrats favors to sell.

I doubt that was the stated purpose, but how (selectively?) regulations are enforced requires much more ‘oversight’ than it is being given.

I'm pretty sure that you believe virtually anything some shitty government does is a "perfectly legitimate exercise of state power,"

Yep, which may be why an alleged “Very Conservative” poster is suddenly advocating for state ownership and/or control of a private company.

 

[EMNofSeattle]

Are you asserting that granting patents is not a federal power?



It didn’t take Constitutional amendment to ban other recreational drugs nationwide.



I doubt that was the stated purpose, but how (selectively?) regulations are enforced requires much more ‘oversight’ than it is being given.



Yep, which may be why an alleged “Very Conservative” poster is suddenly advocating for state ownership and/or control of a private company.

Are you asserting that granting patents is not a federal power?



It didn’t take Constitutional amendment to ban other recreational drugs nationwide.



I doubt that was the stated purpose, but how (selectively?) regulations are enforced requires much more ‘oversight’ than it is being given.



Yep, which may be why an alleged “Very Conservative” poster is suddenly advocating for state ownership and/or control of a private company.

Conservative means defending a conservative social order. Not blind defense of neoliberal economic policy

 

[eman623]

That’s not totalitarianism, that’s enforcement of nobless oblige, the noble and merchant class should have obligations to the social classes below them and one of the roles of the crown is to wield the sword to enforce these.

It's totally totalitarian.

An iron fist in a velvet glove is still an iron fist.

 

[ttwtt78640]

It's totally totalitarian.

An iron fist in a velvet glove is still an iron fist.

Yep, when the government is able to decide what a proper price (or profit margin) is then that is socialism (government control of the means of production).