[Edit]: Which is not to say that there are hurtling objects on these things, but that this is talking about What Happens Least, and there is just as much risk of something falling from a balcony or second+ story area as there is a drone falling mid-flight.
To drop something really dangerous off of a balcony usually requires malice or gross negligence, and that generally goes straight down. The operator of a drone with crappy safety systems might simply have to leave it flying for too long without noticing the fuel gauge is nearing empty.
Once the FCC hashes out things like how drones should act automatically in safe ways such that untrained pilots can't easily kill multiple people with them by being slightly negligent or stupid, then I'm all for civilian drone flight.
Isn't that effectively the same as regulating the machine specifically, but without all of the overhead, corruption, and limitations on creativity, and wouldn't the law actually have the same effect if persons found to operate drones in an unsafe manner were actually prosecuted? Wouldn't the market only accept safe drones due to the possibility of jail time?
Just curious. Been kicking that line of thought around a lot as I've been in some creaky elevators recently.
Unfortunately, modern markets are empirically fairly poor at optimizing for long-term outcomes with all externalities accounted for (example off the top of my head: the Deepwater Horizon oil spill).
When a major malfunction or accident does happen, no penalty or fine is really sufficient to bring about any meaningful sense of justice. (Think again the oil spill, or a tainted staple food poisoning tens of thousands of people, or to use a really cliché example, a malfunctioning UAV crashing into a group of kids playing at recess.) As the accidents are often due to incompetence or attempts at cost-cutting rather than outright malice, the deterrence factor of the penalty doesn't really apply – to those guilty, it just looks like they're taking the good kind of risk optimizing their systems until it's too late. The guilty corporation simply can go bankrupt and out of business, and finding and then charging personally responsible employees isn't always easy.
While government regulations might not be the most efficient, they do not cloud a picture of exactly how safe a plant is and will remain that would otherwise be perfectly clear. Short of each investor evaluating safety of each plant, oil rig, and factory themselves, the situation with government regulation removed would boil down to an analogy to the S&P credit rating business. We've seen how for-profit independent third-party rating business has worked out.
If you'd like an example from a market with little regulation, look no further than Bhopal.
I'm not going to argue that the current regulations we have in place are amazing. They're not and they can certainly be improved. I will, however, argue that they do a better job keeping us safer than the free market, as it has been implemented worldwide over the last century, would.
Having a law in place is a start, but it has little effect against those who would cut corners. I believe the saying is that "laws only keep the lawful honest." There will be a lot of manufacturers building TacoCopters who will cut corners because it's cheaper, and others who simply don't care because the don't expect to get caught.
However, if the FAA mandates (e.g.,) complete engine teardown and rebuild every 200 operating hours along with an annual FAA inspection, they can actually verify that those procedures are being followed. The law will still be in effect, but verifying that it is being followed happens well before someone is killed and will take the vehicles most likely to kill someone out of the air.
That's what they're trying to accomplish.
This is why we have building codes and regulations. Since the FAA did not have these regulations in place, it was disallowed (commercially.) Congress recently said "make the regulations" because it seems like there is enough demand to justify the increased burden on the taxpayer.
v(h) ~ sqrt(h)
thus
Ek(h) ~ v^2 (h) ~ h
Which means, the higher something starts, the more it will hurt when it hits your head.