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Oh and speaking of crony capitalism:

Mr. O'Driscoll is a senior fellow at the Cato Institute. He has been a vice president at Citigroup and a vice president at the Federal Reserve Bank of Dallas.

Perhaps Mr. O'Driscoll, a prime example of what he claims (to his credit) is wrong with the American economy, should take his own advice and quit the think tank.

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I think his point was about bad incentives, not necessarily bad people. As Cato is neither a regulator, not a regulatee, I'm not sure why his employment there would make any difference.

The influence government policy and are part of the revolving door system he claims is the problem.

This is just not true. The "revolving door"-system generally refers to the problem that private firms (the regulated) employ people who formerly worked for the regulator, thereby incentivizing regulators to regulate in favor of private firms so as to maximize their job prospects after their government term has ended. While it is true that candidates for governmental positons get temp positions at think tanks, think tanks themselves are neither regulated nor get paid by regulated firms to lobby the regulators to propose beneficial (to the regulated) regulations. So neither Cato nor AEI nor Brookings are part of the revolving door system.

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