What would that have to do with economic policy?

The current "stimulus" package is a great example. Well over half is just pumping up budgets for existing programs. Does anyone believe that those "enhanced" budgets will not become permanent?

Govt regulation also reduces diversity. It says that everyone pretty much has to behave the same way. We know how that works out.

Govt regulation is also political in the worst sense. Wells Fargo took a huge hit when it stayed out of the subprime mortgages. Regulators refused to let WF enage in unrelated activities (acquisitions, opening branches, etc.)because WF didn't "play ball", activities that said regulators let cooperative institutions do.

Note that regulators don't take the hit.

Um, we get Food and Drugs that are safe? Drinking water that's actually drinkable and not full of stomach parasites and Cholera?

We get stable deposit banks? Notice that regional banks like BB&T, United Bank, and PNC -- non-investment banks, didn't engage in predatory lending. Their growth was stunted during the housing boom, but their customer's deposits are safe, the banks are stable, and they're in no need of a bail out. And again, due to regulation and FDIC, your money is much safer than pre-Depression era banks.

>Govt regulation is also political in the worst sense. Wells Fargo took a huge hit when it stayed out of the subprime mortgages. Regulators refused to let WF enage in unrelated activities (acquisitions, opening branches, etc.)because WF didn't "play ball", activities that said regulators let cooperative institutions do. Note that regulators don't take the hit.

I'd like to see some URLs, because (no offense) you're either being too concise or babbling non-sense. I'd like to read up more on it before concluding "regulation == ultra bad" simply from your paragraph.

Nope. We get blockbuster drugs, after a long delay, and that's about it. As to their safety....

We're not seeing new antibiotics.

Feel free to explain why Viagra is more profitable than a new antibiotic. (Profit = revenues - costs, so the argument should consider both revenues and costs.)

> Notice that regional banks like BB&T, United Bank, and PNC -- non-investment banks, didn't engage in predatory lending. Their growth was stunted during the housing boom

Their growth was stunted by govt action because they weren't meeting their "lend to folks who can't pay back" quota.

> And again, due to regulation and FDIC, your money is much safer than pre-Depression era banks.

Huh? Somewhere north of $2 Trillion is being pissed away because of govt regulatory failures and you think that my money is safe?

>>Govt regulation is also political in the worst sense. Wells Fargo took a huge hit when it stayed out of the subprime mortgages. Regulators refused to let WF enage in unrelated activities (acquisitions, opening branches, etc.)because WF didn't "play ball", activities that said regulators let cooperative institutions do. Note that regulators don't take the hit.

> I'd like to see some URLs, because (no offense) you're either being too concise or babbling non-sense.

http://www.tradingmarkets.com/.site/news/Stock%20News/192184...

The "Community Reinvestment Act" is code for "subprime loans".

Because of the same market forces you're arguing for. And we are seeing new antibiotics. SARS, for example, didn't kill everyone. Although as a side-effect, the drug used to treat SARS killed all their living bone marrow.

So developing a curative anti-biotic that germs aren't already resistant to, that doesn't box liver/kidneys/bone endocytes is a largely complex, potentially intractable problem.

The two new techniques we're seeing is RNAi "wipes" to prevent transmission of the Herpes Simplex Virus (a potentially new anti-viral drug -- and a technique to develop more anti-viral drugs), and studying Alligator Blood. Alligator's "White Blood Cells" are extremely powerful, and we may be able to synthesize proteins that are safe for humans, and yet equally powerful.

So yes, new antibiotics are here, or they're coming. They just don't warrant commercials because you're not going out to ask your doctor about the new antibiotic the same way you're going to ask about Viagra. You could argue that "nothing new is happening with battery technology? Where are all the new battery technologies?" You'd be right (nothing new worth marketing about) but you'd also be wrong (plenty of incremental improvements over the last 20 years that've dramatically changed battery performance.)

>Their growth was stunted by govt action because they weren't meeting their "lend to folks who can't pay back" quota.

Again, wrong. BB&T's CEO has stated they didn't join in the Bubble for reasons other than government regulation. Their growth was stunted in the sense that you were getting a sensible 6% return instead of the 9% you'd get with BoA or Citi. Except now your investment is still around, your competitors isn't. Its one of those "When I'm excluded from the bubble I'm losing money, but now that its over I'm raking it in" things that just happens. Its also what fuels bubbles: If your competitor is shortchanging his customers, but delivering superior returns, your customers will seek him out. So you can lose business, or your engage in short term, unsustainable thinking just like everyone else. They choose the former.

>Huh? Somewhere north of $2 Trillion is being pissed away because of govt regulatory failures and you think that my money is safe?

Again, Investment Banks != Deposit Account Banks. If you were investing in a mutual fund, there was risk. That's what you were trading higher returns for -- the risk you might lose money. If you simply dumped your money in a depository account -- something FDIC and 0% risk, then no, you couldn't have lost money. Nobody has.

And again, that's one of the reason why depository banks have been incredibly stable since the last great depression: They can survive bank runs, and even if they become insolvent, the government has $44 million of insurance money to ensure you get your money back with little hassle.

Again, after reading the URL you gave me, I think you're babbling non-sense. Yes, I get the point: The CRA allows the bank to lend to people who otherwise couldn't get loans. But the claim "Wells Fargo took a huge hit when it stayed out of the subprime mortgages. Regulators refused to let WF enage in unrelated activities (acquisitions, opening branches, etc.)because WF didn't "play ball", activities that said regulators let cooperative institutions do." is NOT substantiated by the article you linked. More HOW and WHY, less WHAT, please.

> Again, Investment Banks != Deposit Account Banks. If you were investing in a mutual fund, there was risk.

Who said anything about mutual funds and investments? The financial mess was in regulated institutions. We've pissed about $1 trillion into them so far and are about to pass a $1 trillion "stimulus" package.

It was the regulators who put tax incentives on banks holding Fannie and Freddie stock, which put many of them under when that govt created house of cards collapsed.

> The CRA allows the bank to lend to people who otherwise couldn't get loans.

No, that's not what the CRA does. The CRA "encourages" banks to make certain kinds of loans. Banks were free to make those loans without the encouragement but weren't, hence the "need" for a law.

The article that I linked to is one example of how the CRA is used to "encourage" banks to play ball. It gave "activists" a tool for blocking unrelated banking activity.

Largely because of the costs of FDA regulation compliance, it costs ~$1-2 billion to develop the average new drug. http://en.wikipedia.org/wiki/Pharmaceutical_industry#The_cos...

How many potential drugs, each year, have not been developed, because of the difference between that cost and the potential cost in a zero-regulation environment? Thousands? Millions?

Oh, and a zero regulation environment? There's always going to be liability for "your drug killed people". In a zero regulation environment that cost is going to be incredibly high. Or your placebo drug is going to CAUSE economic damage by killing productive workers.

Your model of regulation/no-regulation is far too simple. As always, there is a sweet spot somewhere in the middle where both the public (consumer) and the corporation (producer) benefit.

And as always, if the cost of new drug (say an AIDS cure) is prohibitively high, a government may subsidize the process. Or even simply provide capital incentive (say a $2 billion winner take all prize, like an X-Prize for drugs).

It depends on why they couldn't be patented. There's a nasty interaction between regulatory delay and patent terms starting at application which means that drugs that don't have huge markets don't get developed, but I'm pretty sure that you're not referring to those.

Let me guess - you think that there are substances which are unpatentable because they fail the novelty test but have great utility as drugs. If said utility is newly discovered, that satisfies the novelty test. If said utility is "folk medicine", then the only thing stopping anyone from selling them as drugs is the regulatory testing costs.... (Drugs don't have to be patented.)

The big scramble to re-purpose drugs is while they're still patented by one manufacturer. Once someone like Mylan is manufacturing it as a generic, doing research for "novel" forms is only helping your competition.

Umm, that's an argument against regulation. Regulation is imposing a cost that can't be recovered.

Note that the initial testing established "safe" (for some definition of "safe"), so any regulation-required testing is mostly for efficacy.

Combine that with the headstart of stem cell research the UK and Germany has, and we'll like see some cost-saving medical breakthroughs coming out of that part of the world in the next 3-5 years.

Not unless one overcomes the barriers to pharmaceutical access.