[nickff]

Not parent poster, but I can take a shot at this.

WRT the 2006 financial crisis, there were about 10-20 regulatory agencies that had the power/responsibility to maintain stability. Each of them failed, but none were held to account; they each just made some excuses, and demanded more power and money.

Every time there's a crisis, the relevant regulator is exonerated of any responsibility, so their incentives are even weaker than those of the executives getting bailed out.

[jedmeyers]

I agree. In addition regulators have zero incentives to serve the interests of the regular people. They do, however, have a huge incentive to block the market for the new competition (aka regulatory capture) and then comfortably rest and vest in a major corporation after quitting their government job with full benefits.