I don't think regulation can solve those problems, but there is no doubt that Regulation helps stop things like virus outbreaks and companies from doing anythin

I don't think regulation can solve those problems, but there is no doubt that Regulation helps stop things like virus outbreaks and companies from doing anything they want - like putting the cheapest paint (with the highest concentration of lead) on kid's toys. Not saying the gov't should regulate everything, obviously not, but there should be some regulation on somethings. Things to do with health, finance, and food are clear ones. Especially given the current structure of the tax code that provides subsidies and tax incentives/distortions to politically connected parties. As Milton Friedman says, big business hates the free market. So the government has to protect it - by regulating lightly. Edit: Btw, your example about the iPhone app, drives my original point home even more. The government is incompetent when trying to pick winners. Their job is to protect wider society from things that can threaten health (cancer causing additives, wide spread infections, virii - not the computer type, etc.). Although, there could be an argument for allowing the companies to do whatever they want and let the market handle them. If a drug company releases a drug that kills a bunch of people, I think that pretty much decides the fate of that company - however, that is predicated on the fact that the drug industry is indeed free and firms can enter and leave at will (without barriers). The issue with that though, is that is politically impossible to have a government stand by and do nothing when 10 - 50 people have been killed by a drug put out by a company. So no politician would dare do that....even though it might work out better for society, assuming of course, that we can avoid those 'fringe' cases where drugs create an infectious disease that kills millions and spreads like crazy (possibly creating zombies, although that would be a pretty Epic scenario IRL assuming I am not one of those zombies and I have a shotgun with unlimited ammo :) )