gjm comments on Policy Debates Should Not Appear One-Sided - Less Wrong
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No, but I'm pretty sure it's shorthand for something like this:
which is a simple factual observation, plus this:
which, while in principle it's "speculation", seems about as speculative as "if we set up a stall in the street offering free cake, some people would eat it".
(I take it it's obvious that "Sulfuric Acid Drink" was intended as hyperbole, to indicate something not quite so transparently harmful, masquerading as a cure. If it isn't, you might want to consider why Eliezer called it "Dr Snakeoil's".)
Apparently you disagree on the grounds that actually no one would be selling such things even if such shops existed. I think they very decidedly might.
Selling fake cures for real diseases (or in some cases fake diseases) has historically been very profitable for some people, and some of those fake cures have been poisonous.
That's a stronger argument. I think Robin may have been envisaging -- and, whether or not he was, Eliezer may have taken him to be envisaging -- that selling in the Banned Products Store exempts you from more than just standard-issue regulatory red tape. I am not an expert on US tort law, so I'll take your word for it that Dr Snakeoil would not be able to get out of trouble just by protesting that he honestly thought his Sulfuric Acid Drink was good against arthritis; if so, then indeed the Banned Products store might be substantially less dangerous than Eliezer suggests.