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To some extent this sounds reasonable. I generally follow the principle that "that government is best which governs least," and prefer the government stay away from dictating our behavior when it will not hurt anyone else. Government intervention in our choices of things which might risk our own health but not hurt anyone else is an infringement of freedom that seems prima facie unnecessary.
The problem is that as the system stands right now privatizing the FDA will not necessary increase our freedom. It seems like a private FDA would quickly become a shill for big corporations. Look at current drug testing practices: some companies today sponsor studies by universities (who definitely need the grant money) under carefully written terms and conditions so that if the results look bad, they can keep the research to themselves and legally bar the researchers from publishing the results (to protect trade secrets). With no regulatory agency at all things would likely just get much worse.
To expect an industry like big pharmaceuticals to regulate itself is a idealistic dream of capitalism. Unfortunately corporations do everything they can to get around the laws, bending them as far as possible in order to maximize profit. Remove the laws and they will seize most any opportunity they can in order to continue increasing profit.
Now one might argue that people will stop supporting companies that screw them over, but that does not seem to be the case. Companies screw people over today and people still go back to them. Some of the worst and most abusive companies are the most financially successful. Right now they try to work within and stretch the laws while maximizing profit. In the absence of legal oversight they will be able to do even more damage while more effectively hiding it.
Currently if a company is found doing wrong and gets a bad reputation, it can go through some legal loopholes to dissolve and then start up a new company with a new name - but still the same company - and keep doing what they were doing before. Without the regulation they will still be doing the same tricks but worse.
If people find out some big drug company is doing something horrible, the company can switch its name or start selling through a different subsidiary, and the average consumer has no clue of the connection and still financially supports the company that he thinks he is boycotting. It is almost impossible to research and keep up with all this information in our fast-moving society these days; and it is certainly impossible for a single individual consumer to do all the research needed to follow what products are okay to buy and support and which should be avoided.
So while it is true that government regulation of what medicines we are legally allowed to purchase and use is an infringement on our freedom, it seems like privatizing the FDA - essentially doing away with it as a regulatory agency and turning it into a public relations machine - would in the end lessen our freedom. We would become trapped by corporations (who spend billions every year on market research to learn just how to coerce consumers into buying their products).
Is government by government worse than government by corporations? If you end up a slave to the system either way, you are still a slave and it becomes a matter of semantics whether the people ruling you are called a 'government' or not. You are still being ruled. As Ralph Waldo Emerson put it:
"I do not wish to remove from my prison to a prison a little larger. I wish to break all prisons."
As the system is set up right now, private companies will not self-regulate, and complete non-regulation of all business will lead to a much worse prison than what the official government puts around us. Ideally we should find a system where government is not necessary at all, but while our social system is still full of these sorts of problems, the next best thing is simply minimizing government so that it provides the needed benefits without bloating up and trying to interfere in every aspect of our lives.
It seems to me that regulating drug companies is one of those things which we are better off with for the time being, which actually leads to more freedom for us as citizens and consumers in the long run by giving us relatively reliable information on which to base our medical decisions instead of being trapped into making decisions with only the information that corporations choose to selectively release.
So then what about the claim that the FDA moves too slow, that it should release new drugs into the market faster? As annoying as it is to have the leviathan move so slowly, it seems vastly preferable to allowing it to make sudden jerks in one direction or the other. By moving slowly, it ensures that a fad product or a media-blitz'd product cannot get widespread on the market and do huge amounts of harm before anyone realizes it is unsafe. That takes tests and trials, and those take time.
Given the current state of our society a slow FDA is certainly better than no FDA, as argued above. But is the slowness really such a bad thing? To me it seems analogous to Congress's slowness. People complain that the U.S. government cannot get any real change done without waiting years or decades, that it cannot respond to new developments or fix problems quickly.
That sounds bad until you look at history and realize the potential for major problems when a government is allowed to make big changes quickly. Consider how easily representatives fall into line when there is some national fad, panic or paranoia. Take for example the fast passage of the huge Patriot Act (which changed many important statutes) days after September 11, 2001 without time to consider its far-reaching effects or constitutionality. If that seems problematic, imagine if the system had had no checks to slow things down when the executive made a power grab during the emergency, if there was little chance of undoing bad laws after they were passed.
Instead, today heads are cooling off and a lot of representatives and judges are realizing the mistakes of the too-broad Patriot Act and are trying to swing things back a little more toward balanced. It is precisely because the system is set up to move slowly, not to pass legislation and fix things quickly, that security fears did not compromise liberty as far as they could have - and the reaction certainly could have been worse, considering how much further many critics thought the government should go in the wake of that disaster.
In the same way that a slow Congress protects against large, swift changes in government which could lead to abuse, a slow FDA protects against corporations pushing new, potentially unsafe drugs onto the market without adequate information. It may mean decreasing our options in the short term by keeping a promising new drug off of the market, but in the long run it keeps the drug end of the medical system running in a stable manner so that we can get safe drugs at all, which in the end seems worth the trade-off.