Why Replacing People Won't Fix the Problem
Understanding regulatory capture and why the system is broken, not just the people
What Is Capture?
Regulatory capture is when a government agency is controlled by the industry it's supposed to regulate. Instead of protecting the public, the agency protects the big companies.
Why It Happens
Big companies have money and power. They can offer government officials high-paying jobs after they leave government. This makes officials want to help the companies instead of regulating them.
The Revolving Door
The 'revolving door' is when government officials go back and forth between government and industry. They work for a company, then work for the government agency that regulates that company, then go back to the company. This creates a conflict of interest.
Why Replacing People Won't Help
Even if you replace the people in charge, the new people will face the same incentives. They'll want a high-paying job at a big company after government. So they won't enforce the law strictly. The problem is the system, not the people.
What We Can Do
We can demand that government officials not be allowed to work for the industries they regulate. We can demand higher government salaries so officials aren't tempted by industry jobs. We can vote for politicians who care about fixing this problem.
The Bottom Line
Regulatory capture is a system problem, not a people problem. Even if you replace the people in charge, the new people will face the same incentives and make the same bad decisions. You have to fix the system.
Regulatory capture is a system problem: Government agencies are controlled by the industries they regulate. This isn't because the people are corrupt. It's because the system creates incentives for capture.
The revolving door creates the incentive: Government officials know they can get high-paying jobs at big companies after government. This makes them want to help those companies while in government.
Replacing people won't fix it: Even if you replace the people in charge, the new people will face the same incentives. They'll make the same bad decisions.
You have to fix the system: To stop regulatory capture, you have to change the system. This means higher government salaries, restrictions on the revolving door, and enforcement of antitrust laws.