As one commentator points out, the line between legislating personal morality and legislating anti-social behavior is not always clear. There are gray areas. My point, however, is that the more government tries to regulate people's lives, the more difficult it is to get people to comply with the law. Noncompliance undermines public confidence in law. We should choose the laws we really need.
I may be wrong on this, but I do not believe prohibition of alcohol was something we needed in the 1920's. Enforcement of state anti-fraud statutes in the securities business was something we needed and didn't have.
And there are more contemporary examples. See Bowers v. Hardwick, 478 US 186 (1986) (upholding criminal statutes that almost nobody enforced regulating conduct widely considered nobody's business), overruled in Lawrence v. Texas, 539 U.S. 558 (2003). Regulating sex is about as likely to be successful as regulating booze. I look forward to hearing convincing evidence to the contrary.
Excessive government regulation affects government ethics because it brings more lobbying and more money into the political process to address an entire range of issues in addition to those that need to be regulated. The modern day "morality crusade" has become a very lucrative enterprise for some -- and is very much tied up in our dysfunctional system of campaign finance -- but it is not necessarily good for the Country. More on this later.
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