Addressing this in a slightly different order: > > I agree we want regulation to be of the second type, but sometimes the first type is the only practical way

Addressing this in a slightly different order: > > I agree we want regulation to be of the second type, but sometimes the first type is the only practical way to do it > You're assuming that the benefits of the first type exceed the costs. Yes, that's what I meant when I said "the only practical way to do it." FCC licensing is not prohibitive on innovative, small radio companies, and is hugely beneficial to avoid a tragedy of the commons. > > Bureaucratic love-ins aside, regulation doesn't need to fall any heavier on the little guy than the big guy > It may not "need to", but it always does. Walmart can always amortize its regulatory burden over more revenue someone else can. And with the savings, they can get special rules and treatment. They get to write the rules. Two things: amortizing is unavoidable, but Walmart has more regulatory burden than a corner shop, so it has both more costs and more revenues -- who knows what the ratio is? Often the corner shop avoids regulation costs by getting away with ignoring some of it, which is probably as near to optimal as we can hope to get. Getting to write the rules, we'll get to that. > Yes, I know that you have good intentions for regulation, but reality trumps. The Clean Air Act, the Factories Act, the Child labour laws, clean water acts, the powers that will be used on BP to make them pay for Deepwater, FCC spectrum allocation. Yes it's political, and yes it's messy, and of course special interests get more than their fair say, but those are problems with democracy, not regulation. My intentions are irrelevant, but reality works out pretty well thank you so very much. > Regulation is systemic risk. It's also always captured by the politically powerful. What's your point? "The politically powerful set the rules" is a tautology. The only way I can see you going from here is hardcore Libertarianism, and I don't bother debating that.