Reverse Regulatory Capture
Reverse regulatory capture is an advanced move where industry interests cry “regulatory capture” in order to oppose regulation. Generally, the more skeptical people are about corporate power and the vulnerability of regulators to influence, the more worried they are about regulatory capture.
If you’re extremely skeptical about big companies and their influence over regulators, it’s unclear whether you should be comforted by government officials talking about regulatory capture. This is because it might actually be a sign that the opposite is happening—that reverse regulatory capture is taking place.
Insofar as politics is an adversarial environment, it should be expected that any kind of claim that can be abused will be abused. It is magical thinking to believe that certain kinds of claims—such as claims of regulatory capture—will be immune to this.
The first line of defense is simple—equal skepticism. Insofar as you are skeptical of corporations advocating for regulation, you should also be skeptical of corporations advocating against regulation. Insofar as you identify a corporate interest in incumbents to create regulation that hampers less well-equipped competitors, you should also be aware of the corporate interest in avoiding regulation.
Insofar as you are skeptical that certain actors are just chasing corporate profit, you should also be skeptical of attempts to push the narrative that certain actors are just chasing corporate profit. Actors who wish to manipulate you will often be aware of the buttons that they can push in order to make you take a certain response. One path for better understanding actor’s motivation is to look for public comments that they made before they had a profit incentive. Did their public comments sharply change along with their interests or have they been consistent throughout?
Another way to understand the trustworthiness of an actor is to look at their public communications and to try to determine the extent that they are ideologically pushing a narrative or engaging in underhand tactics like ad hominem attacks. The less concerned an actor is with ethics, the more worried you should be about that they are pushing a narrative out of self-interest. The more principled an actor is, the more willing you should be to accept that they are making their decisions out of sincere belief, even if they might be mistaken.
Untangling the webs can be confusing, but it can be done. Unfortunately, most people barely try, preferring to believe whatever narrative is most convenient for them to believe.
If you feel that you could write a better article on this topic, feel free to reach out. I’m very open to agreeing to allow reuse of parts of this article in other people’s works.
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“The Bootleggers and Baptists effect describes cases where an industry (e.g. bootleggers) agrees with prosocial actors like regulators (e.g. baptists) to regulate more (here ban alcohol during the prohibition) to maximize profits and deter entry. This seems to be happening in AI where the industry lobbies for stricter regulation. Yet, in the EU, OpenAI lobbied to water down EU AI regulation to not classify GPT as ‘high risk’ to exempt it from stringent legal requirements.[1] In the US, the FTC recently said that Big Tech intimidates competition regulators.[2] Capture can also manifest by passively accepting industry practices, which is problematic in high-risk scenarios where thorough regulation is key. After all, AI expertise gathers in particular geographic communities. We must avoid cultural capture when social preferences interfere with policy, since regulators interact with workers from regulated firms. Although less of a concern in a rule-based system, a standard-based system would enable more informal influence via considerable regulator discretion. We must reduce these risks, e.g. by appointing independent regulators and requiring public disclosure of regulatory decisions.”
“Big Tech also takes greater legal risks by aggressively and (illegally) collecting data with negative externalities for users and third parties (similarly, Big Tech often violates IP [3] while lobbying against laws to stop patent trolling, claiming they harm real patents, but actually, this makes new patents from startups worth less and more costly to enforce.)[4] “
OpenAI has lobbied to Water Down AI Regulation
Khan Rejected FTC Ethics Recommendation to Recuse in Meta Case
Time to Fight Back Against Big Tech’s IP Assault
Patent Trolls and Capital Structure Decisions in High-Tech Firms
Do you have any examples (or likely examples) of this happening?
I think that sometimes it’s useful to just discuss a concept in the abstract. I’ll leave it to others to discuss this in the concrete.