I think you'll find that the majority of humanity (those who aren't libertarians) actually agree that policing the negative externalities of business should be part of government's function.
Stuff like "we're destroying the ozone layer," "L.A's air is mostly smog," and "this factory keeps tearing children limb from limb" were effectively solved by government policing these negative externalities, not by "the market."
I specifically said externalities are real problems that bear addressing.
The problem is that once politicians are turned loose, they never stop. They cannot stop. They can't say, "well done, problem solved, let's pack up and go home." That would mean giving up their hard-won power -- and the concominant benefits to themselves and their friends that came with it.
So they must always seek yet another supposed outrage to feed their power. When they can't find one, they manufacture one, to increasingly absurd and implausible lengths, eventually wrecking the system.
But even if I grant you the argument that the same system that bans child labor necessarily leads to the neoliberal brainworms of "let's create a 3% tax credit for businesses that used to be car washes," I'm still very happy we addressed the real problems. And I'd say that government intervention worked, even if some of the laws they pass are stupid or trivial.