Conservatives tend to criticize overlarge government on general principles: it is inherently inefficient, it doesn't do a good job at...well...anything, it slows economic growth through its maze of fees and licenses and controls over exactly how things should be done. These are all excellent reasons to eviscerate the state and its control over commerce.
But perhaps the most dangerous of its effects on the economy is what doesn't happen -- innovation.
Here is Coyote Blog in one of his regular and worthwhile rants against the regulatory state. There is a bonus too: he skewers Kevin Drum!.
Here is what regulation, particularly utility-style regulation, tends to do -- it locks in current business models and competitors. It makes it really hard for new entrants to challenge incumbents with innovative new business models or approaches, because regulations have been written based on the old business model and did not take the new one in account. So a new entrant must begin business by getting regulators to allow their new model, which never happens because by this time incumbents have buildings full of lobbyists aimed at the regulatory process. Go ask Tesla and Uber and Lyft about how easy it is to enter a heavily regulated business even with a superior new business model.
Read the rest here...