[palmer]

Regulatory capture is when the people tasked with keeping an industry on its best behavior have too close ties to the industry, through personal connections or financial incentives, and are no longer able to do their jobs.

I would agree that we have a problem with inadequate or corrupt regulators in several industries.

[bradleyjg]

Regulatory capture can take the form of outright corruption, but the more insidious form is cognitive capture. That's where the regulators simply don't have a sufficiently detached perspective from those they are regulating. They internalize the needs and thought patterns of the industry as there own.

A related phenomenon in foreign affairs circles is called "going native".

[redblacktree]

That's very interesting. It's easy to imagine how, as a regulator, going out to dinner with the regulated (or their representatives) on a regular basis would influence your thinking. It doesn't require a conspiracy theory, so it gives us a great jumping-off point for a rational discussion about how to limit the opportunity for this phenomenon to manifest. Thanks for the new viewpoint!