Comment by dragontamer | Hacker News Reader

Comment by dragontamer | Hacker News Reader

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"Regulating themselves" is a misnomer and rarely happens in government.

Judges are regulated because they can't bring forth cases. Only a prosecutor can. The prosecutor is regulated because they can't make a decision, only the Jury can (and the Judge handles meta-decisions). The Police cannot execute you, they can only had evidence over to the prosecutor.

"Government" is about designing a system of different people, doing different jobs, doing different checks and balances against each other. Anyone who thinks "Oh, X just will self-regulate" is looking at the worst of strawmen.

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That being said, in many cases we don't know what kind of system should exist to move forward. In these cases, having the free market self-regulate while we figure out issues is probably better. Later on, we can write laws that benefit everyone once we understand what the heck is going on.

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I don't think our banking system is doing much wrong. Yeah, I'd prefer if SVB didn't take a bunch of people's money, but the shareholders (and maybe even the bondholders) are going to be wiped out by this debacle. FDIC taking over in the case when things get bad did work, I just personally disagree with what the FDIC did.

> "Government" is about designing a system of different people, doing different jobs, doing different checks and balances against each other.

This definition of government from an 8th grade civics textbook is an extraordinary claim that requires extraordinary evidence, since all the evidence we have from the historical records shows that states are captured by economic elites to the point of stagnation until that economic elite is violently displaced or is forced to reform due to external threats.

> That being said, in many cases we don't know what kind of system should exist to move forward. In these cases, having the free market self-regulate while we figure out issues is probably better.

This also runs against the historical record and requires extraordinary evidence or at least some walkthrough of how you reached the conclusion that self-regulation was probably better, or even possible.

Ie, without postulating a utopian society made up of some kind of post-human who is more moral and more intelligent than all hitherto existing humans, it's unclear why anyone would expect the wealthiest and most influential to refrain from engaging in both the expansion and the capture of state power for their own self-interest. Such a species would have to be engineered and universal because there's no way you could get such traits through natural selection nor can you find them in the cognitive architecture or evolutionary history of primates.

Because under a fully deregulated scheme, corporations will raise a private Navy + private Army and then conquer India... effectively becoming a government on their own.

Governments, in general, are constantly "less bad" schemes compared to their predecessors. The Roman Republic is pretty bad by today's standards, but it was far superior to other forms of government in the timeframe it existed in.

The discussion of "Government" is innately about "Good Government", not bad ones. A good government will split responsibilities in a way that proves to everybody that its trustworthy. That's the lesson on modern civics (ie: anything from the Magna Carta or more recent).

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In any case, I'm not convinced that the fully privatized scheme discussed in this blogpost is to anyone's benefit. The current scheme of free-market banks that collapse on their own (and then the US Government stepping in afterwards) has numerous benefits in practice.

I appreciate you clarifying your points where they were proscriptive rather than descriptive, it is certainly a common civc intention of government and a persistent ideal of governance.

In a previous era from 1890-1910, the purpose of "trust busting" and regulating industry was specifically to limit the threat of any single private entity from creating enough systemic risk to be considered "too big to fail."

There's nothing particularly pro-market about saying that habitual drunk drivers who no entity will sell accident insurance to must be retroactively insured for free by the government to contain the systemic risk they inflict on sober people.

The legitimate benefits of the technological innovations that've come from no-downside financial speculation appear to be increasingly portable, available to other societies either through reverse-engineering or commodities-for-technology-transfer or outright espionage.

So regardless of how much the top 5-20% of Americans and their cultural institutions have a moral or predictive-utilitarian argument for the societal and technological benefits of concentrated capital and financial policy that sees the wealthiest capture a larger percentage of GDP decade-over-decade, it appears to be internally destabilizing and internationally weakening by nearly any metric one could name.

To steelman the other side of this, one could argue the decline is overstated and temporary or attribute it to other factors. But it's no longer the case that a majority domestically or internationally is confident that this is the least bad system to emulate out of all the really existing systems.

Powers in decline and relative elites within them tend to spend a lot of time creating theories for why the majority is wrong to feel the way they do, but historically that strategy has failed, regardless of if what replaces the existing system eventually turns out to be even worse.

At least in the US politicians surely “regulate” themselves. They pass laws setting their benefits, pay schedules, etc. They can even exempt themselves from laws (insider trading cough).

> Police cannot execute you...

In theory

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