I think the OP identifies one of many problems about the current structure of the FAA and the FARs, but his resolution is flawed. I've always been of the opinion that the FAA does not belong in private aviation at all. (Part 91) I keep my plane safe to fly, and keep myself competent and safe as an aviator because I don't wish to die, kill anyone else, or be sued for all I'm worth. I believe most aviators and/or aircraft owners have similar motivations.
I think we need the FAA and the FARs, but only to provide common rules by which to certify aviators, regulate the airspace, and provide operating regulations to ensure safe operations when sharing the skies with one another. But beyond that, they are not needed. They belong in commercial operations without a doubt, as profit is a dangerous enemy to safety, as has been demonstrated many times throughout history. But Part 91 ops? Forget it.
Automobile manufacturers only have to prove that the vehicles they design, build, and sell are safe to operate. Once sold, it becomes the owner's responsibility to maintain and operate them in a safe manner. And we are required to have insurance, so that if we screw up, the other guy is financially covered. Requiring private, non-commercial aviators/owners to have annual airworthiness inspections that cost thousands of dollars is counter-productive, as it just takes money away from routine maintenance and upgrades, both of which would likely do far more for the safety of that aircraft than paying some guy to tear it apart and inspect it each year. The manufacturers of aircraft have their recommendations of what should be checked, how often it should be checked, and what it should be checked for. If an aircraft owner/operator fails to maintain his aircraft in a safe fashion, and a post-incident investigation reveals that to be the cause, the owner/operator would be liable for damages to those negatively affected. Just like with your private vehicle.
It makes me angry when I think of all the improvements that could easily, and inexpensively be made to my aircraft, were the FAA not so heavily involved in the process. Imagine how much more efficient and inexpensive inspecting every nook and cranny of your aircraft would be, if the FAA wasn't involved? Imagine the number of new aircraft types there would be, and how much less expensive they would be? Imagine how many more new pilots there would be, with less expensive planes to own and fly? There goes your pilot shortage.
The FAA is literally the idiot sawing away at the tree branch he is sitting on, between himself and the tree.