Regulatory Capture

The agency created to protect you from the industry is now run by the industry.

Regulatory capture happens when government bodies meant to oversee and regulate an industry end up serving that industry's interests instead. The food safety agency staffed by former food industry executives. The financial regulator that writes rules the banks helped draft. The environmental agency that grants permits its own scientists opposed. It's not a bug in the system — it's a pattern that repeats across sectors and across countries.

The mechanism is straightforward. Industries have concentrated interests and deep pockets. The public has diffuse interests and limited attention. Over time, the industry becomes the regulator's primary relationship — providing expertise, data, career opportunities, and political support. The public, meanwhile, assumes the regulator is doing its job and moves on. The capture happens gradually, often without any single corrupt act. It's structural, not personal.

The result is regulation that looks like oversight but functions as protection — not of the public, but of the industry from genuine accountability. Rules get written with loopholes designed by the people who'll use them. Enforcement becomes selective. Fines become a cost of doing business rather than a deterrent.

When a regulator consistently produces outcomes that favour the regulated, that's not failure. That's capture working exactly as intended.

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References

• Sheldon Wolin — Democracy Incorporated (2008)
• Naomi Klein — The Shock Doctrine (2007)