[nicoburns]

> It's not surprising that government policy making tons of student loan money available led to more students being willing to take out bigger loans. This is like Markets 101.

Totally agree with you on this.

> It's tough to take opponents seriously when basic, predictable side effects of favored policies are ignored just to recommend heavier-handed policies of the same kind.

It seems likely to me that the side effect wasn't ignored. Probably there was somebody proposing the "heavy handed" version of the legislation (which actually makes sense because it mitigates the side effect), but somebody else was opposing it because they don't like regulation. Thus, this problematic legislation emerged as a compromise.

Opposition to regulation often seems to be based on the idea that in practice regulation causes more problems than it solves. My observation is that regulation (esp. in the US) often does have this problem, but only because there is such opposition to regulation that it is almost impossible to enact the stronger and more sensible regulation that would actually work.

In short, it is often ideological opposition to regulation that causes it to fail, rather than the case that regulation in general doesn't work.

[DataWorker]

So no true Scotsman? “Regulation never works well because it’s never the right kind of regulation.”

In what world do the regulated parties not oppose being regulated? If there’s no opposition to a regulation then it probably isn’t needed.

[nicoburns]

Sometimes it doesn't work just because it wasn't a good idea to regulate in that way. However there are countless examples of regulation that was crippled in the US, but that has a very successful (and generally stronger) counterpart in Europe.

Perhaps it's just that corporate interests have captured governments. But that too seems like a symptom of distrust in government leading to it being hamstrung and underfunded. I guess it's circular.