This is a wonderful debate, fully stunning in it’s execution. My favorite part is when Paul brings out a story from the good old days and Spitzer destroys him. It reminds me of this Paul Krugman line:
In the various responses to my posts on libertarianism, here and here, some commenters have made a point that sounds reasonable, but actually isn’t. I pointed out that the libertarian alternative to regulation — just use tort law to make people pay for the damage they cause — doesn’t work in practice, because when push comes to shove politicians will shield the rich and powerful from paying the real cost. Commenters say, but isn’t that an equally strong reason to believe that regulation won’t work either?
Well, here’s the thing: regulation demonstrably does work where tort law doesn’t. Consider the environmental issue: in reality, the perpetrators of oil spills never pay most of the cost; but in reality, environmental regulation has led to much cleaner air and water. (Look up the history of Los Angeles smog or the fate of Lake Erie if you don’t believe me.)
So why does regulation work? If polluters can buy off the system ex post, after a disaster, why don’t they manage to totally corrupt regulation ex ante? There’s a lot to say about that, and I’m sure there’s a literature I haven’t read. But one thing we tend to forget in this age of Reagan is the importance and virtues of a dedicated bureaucracy: when you have professional government agencies with a job to do, and treat them with respect, that job often gets done.
:: The Krugs ::
This is worth reading http://en.wikipedia.org/wiki/Necessary_and_Proper_Clause