Conflict of Interest
When the government writes and enforces aggressive legislation and regulation, called positive law, it supposes itself to have the power and authority to play an active role in molding society by political force. But the reason for the creation of governments in the first place was for defensive purposes - negative / natural law. A government cannot participate in creating positive laws without breaking negative laws.
"...the purpose of the law is to prevent injustice from reigning. In fact, it is injustice, instead of justice, that has an existence of its own. Justice is achieved only when injustice is absent."
In this contradiction of purpose comes chaos and corruption. If it is accepted by the people that government should be involved in positive law making, everyone will look to advance their personal well-being through the political means. When government is the regulator, a door is open for people and corporations to seek to seize that power in order to dominate over their competitors and protect themselves from risks in the market. Is it a surprise that corporations spend millions to lobby lawmakers?
Government Regulation Protects Businesses From Liability
Poorly constructed buildings, dangerous medication, and hormone filled foods are serious problems, but it should be recognized that all of these horrible things have been highly regulated by government for decades. They have been approved as "safe" by government regulation. You see regulation, when mandated by government, actually legalizes a certain amount poison in food. It legalizes drugs and immunizations that can kill you. The worst part is that because they have been approved as safe, the guilty parties are pretty much free of liability because as long as they have met the regulatory standards they are not at fault.
When a business is not directly accountable to its customers, they have no incentive to improve the quality of their products and services. Risk of getting sued is the greatest motivator for caution. Government regulations remove that risk and responsibility, resulting in businesses acting reckless and irresponsible.
Government Regulatory Services Are a Subsidy to Big Business
Why is it that we have tax funded building departments? Why are tax payers giving free safety inspections to dairy farmers? Why aren't pharmaceutical companies paying for their own third party test trials? Sure they might pay an occasional small fee, but these departments are not supported by these fees. The staff, building and vehicles are funded by people who may not ever use their services.
A Solution For More, Stricter Regulations
There is no reason why these government service industries shouldn't be privatized and fully funded by their customers- just like any other business. If the burden of liability for the safety and quality of products was placed on property owners and those they contract with we would see an increase in regulation. Businesses would be extremely careful about the safety of their customers out of fear of legal action. Businesses that provide quality and safety inspections would be incentivized by the same fear as their property owning clients. They would be paid to check for safety issues and if they fail, they would be at fault.
Pharmaceutical companies would make cleaner vaccines. Milk and meat would be hormone and poison free and buildings would be built to a higher standard. Some may think this is naive thinking, but again government has already been regulating these things and the result has been that we have lower , not higher, standards of safety, enforced by law.