Comment by knowtheory | Hacker News Reader

Comment by knowtheory | Hacker News Reader

This piece is so horribly fundamentally naive, that it's not worth even considering.

You want to use the evolutionary example? Fine, look at livestock or plant husbandry. We breed and select for animals which serve our needs. Cows that have more meat, which produce more milk. Ones which are more docile. Plants that produce more yield, which are less susceptible to poisoning us, or making us sick as vectors for diseases.

We control a great deal of evolution, because it makes us safer, and healthier.

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This is easily put another way.

There is an Economic fitness landscape, just the same way that there is an Evolutionary fitness landscape.

Just the way that we control the incentives, and conditions for how reproduction takes place in our livestock, we also control the incentives and conditions for economic growth and (re)production.

We must ensure there are sane incentives for how corporations and individuals behave in the economy. We must observe and shape the landscape that we live in or we risk becoming victims of evolutionary, or economic pitfalls, both seen and unseen.

An addendum:

Regulation is a tool to change the landscape and the conditions in which businesses and individuals operate.

You can regulate in a way that benefits certain types of business, i.e. breaking up a monopoly helps smaller businesses. Making the phone companies lease their lines to smaller competitors is a GOOD thing for competition and diversity.

The notion that regulation only ever stifles the economy, in that sense, is simply incorrect.

That is not to say that there aren't regulations that have a stifling/dampening effect, nor that there shouldn't be. Sometimes you do want to raise the bar across the board. We need banks to be sufficiently capitalized in order to be able to pay their customers back.

That may be stifling for banks, but it's in OUR best interest.

All of this also assumes that government can do its job well.

That breaking up a monopoly (and how do you define one, anyway?) is good is not obvious (economies of scale, etc). But even taking this as given, that sometimes monopolies are bad, it is far from clear whether allowing government to intervene will be better.

You have to weigh the costs and benefits. Anti-trust law is extremely subjective. It's existence incentivizes companies to use it against each other to gain a competitive edge rather than real value-added approaches. Anti-trust law creates uncertainty that can deter innovation (should we develop this technology if we can't fully profit off of it?)

Government institutions are like all other institutions - they want to survive. And to survive, they need to grow. Mission creep is inevitable. So even if you have identified a narrow area in which government intervention can help, it is not obvious that we should allow government to intervene.

I know people on HN are very liberal, but this is extremely cynic about institutions. I mean: I know we are not living in wonderland and this is close to true. Here in France I even have the impression that key institutions have mostly been overtaken by private interests. But in theory we are supposed to try to get closer to something called democracy, where those institutions should reflect our common goals and hopes by some collective decision-making process (the difficult part!). Even if it is extremely tough at the scale of countries, and even if we are far from it, I though we were at least trying...

Just tonight on 60 Minutes, the chairman of the FDIC said she thinks it would be good if congress considered limiting the size of banks. She said it is not good when a bank gets so big that it can't be allowed to fail.

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