Sorry but an argument from authority in the field of economics is not even a little bit convincing to me. Not only is economics a "social science", which are notorious for lack of rigour, but economics itself is purposefully bifurcated into biased partisan "schools". There are many economists which study solutions to regulatory capture who do not suggest that regulators should be cut, if you're only aware of one school of thought in this area then you've been looking in a limited bubble.
> We need good regulation, not less
The result of the research is that that is, in general impossible. Sure, some regulators do good work for some period. But the general forces and incentives in play push quite strongly towards the regulator being captured.
The better working alternatives are laws, where disputes or guilt are decided by courts. Since there is no regulator to capture in this scenario, things work pretty well. Of course, lawmakers can also be captured, but that's harder.
One fascinating* thing with the field of economics is that so m any thinks their opinion is worth as much as the expertise of professional in the field.
You routinely hear people confidently claim the economics field is wrong about things they've studied for decades or centuries, because of simple arguments that are all thoroughly accounted for in the beginner literature.
* or "infuriating", if you are an economist :)