[pdonis]

Regulation does not solve externality problems. It makes them worse. For example, the government's increasing regulatory requirements for ethanol in fuel (of which this is an example) cause food to be more expensive and have caused food shortages (because corn is grown to make ethanol instead of for food). Yes, air pollution is a concern, but people who are starving for lack of food don't live long enough for air pollution to be a health concern for them. And nobody asked them whether they were OK with the government making that tradeoff.

[kube-system]

Yes, some regulations don't work.

"Regulations are the only way to solve market externalities" is not the same statement as "All regulations solve market externalities".

The market can never solve market externalities, by definition.

[pdonis]

> some regulations don't work

The vast majority of regulations don't work. At least not if your definition of "work" is to actually solve market externalities. But they're great for job security for regulators and politicians.

> The market can never solve market externalities, by definition.

This is not correct. Markets can solve externalities, through market transactions that shift ownership so that the externalities are internalized. The main thing preventing this is government regulation that raises transaction costs so that the necessary adjustments cannot be made. This has been known at least since Ronald Coase published his famous theorem.

In other words, government regulators prevent markets from solving externalities, and then complain that markets can't solve externalities so government regulators have to step in.

It's true that there are cases where there are no market transactions that can internalize an externality. But in those cases, regulation can't solve them either; there are no solutions for such cases. Welcome to the real world.

[mchid]

An industry that fails to regulate itself is regulated by the government. We've had more than a decade to transition and literally zero progress. Everyone knew this day was coming since congress mandated the transition back in 2009. Crying about it doesn't solve anything — it's well past time to rip off the bandaid.

[pdonis]

> An industry that fails to regulate itself is regulated by the government.

While this is often true, that doesn't mean it's actually an improvement.