Who regulates the regulators? We need to go beyond review-and-approval

Bad things happened.

Review-and-approve regulation happened, things improved.

Another bad thing happened, at a much lower scale.

Regulators cracked down, professional admins replaced experts, things got buried in red tape.

The author argues against review-and-approve but they don't present a better alternative than that first review-and-approve. They mention, but don't really endorse, liability law models. But today's adversarial legal model in the US is also slow, expensive, and results in tons of cover-your-ass legalese at large places.

The "ratcheting up" of the regulation enforcement seems like the much bigger problem here than an "review and approve" model itself. The need to look like you're doing anything to try to prevent bad things from ever happening.

We don't see that everywhere - we enforce speeding and reckless driving laws, but sometimes people still die from traffic incidents caused by those. The reaction hasn't been to put ten times as many cop cars on the road, or ubiquitous speed cameras. We did put in cameras for red lights, but those lost a lot of momentum and were pulled back in some places instead of rapidly turning into constant monitoring of everything about driving.

So is the problem just that politicians don't relate or understand something like a medical study as well as they do driving, and don't understand the tradeoffs and burden required to try to make sure nothing went wrong, ever? If anything, I'd expect that to result in industry lobbyists pushing deregulation to have a much easier go of it than they have. So I don't get it.

A liability model has a couple of advantages despite this:

1. The regulator has some slack to not set penalties insanely high. As long as they're seen enforcing those penalties against someone periodically, and as long as the penalties sound like a big number to the general public, they can look like Stern Serious Regulators who are doing their jobs properly. The difference between a $5M fine and a $10M fine can have huge financial implications, but to the political circus those numbers are both roughly the same size, i.e. big. This allows the regulators to be more reasonable if they want to be.

2. Using liability rather than specific procedural rules lets the people closer to the ground decide how to most efficiently mitigate risk. Suppose that you run a factory, and sometimes people get injured by careless operation of a rotary saw. A naive regulatory approach might be to require that an additional person be watching whenever the rotary saw is in use. And that would probably help with safety somewhat, though at great cost. But if the regulator instead just requires workman's compensation payments to be made when someone gets hurt, then you can try to figure out a better way using your own knowledge of how your factory operates. (Historically, the adoption of workman's comp laws led to factories hiring engineers to make the equipment harder to accidentally misuse. That rotary saw, for example, would have had a cheap guard retrofitted -- and that would improve safety much more, for a much lower cost, than the "have an observer at all times" rule.)

So there is some sort of equilibrium forming, not necessarily an optimal one, but the ratchet does loosen occasionally. For example, FDA has famously succumbed to public pressure and reformed its procedures for drugs for terminal diseases so that patients who have nothing to lose can accept much riskier treatment trials, to speed up development for such drugs.

I say it's not an optimal equilibrium because nobody incentivizes for the common good. Politicians should, but they seldom do. For example, the nuclear industry would lobby and pressure for rapid approval of their existing traditional methods, but they would, as a whole, be very aggressive against a startup with an innovative design. What better way to kill such a competition than to call your regulator, lay out your 'concerns' and bash the startup with thick rulebook, even if those rules are not at all relevant for the new thing, they still have to comply for a 'fair' playing field.