Why don't ISPs peer with everyone?

[rucasbrown at hushmail.com (rucasbrown at hushmail.com)]

Hello,

I wouldn't consider myself a network engineer, nor do I have any 
formal training, but why don't ISPs peer with every other ISP? It 
would only save EVERYONE money if they did this, no? Only issue I 
see is with possibly hijacked / malicious AS owners, but that's not 
very common to do without being caught.

All the whole "don't peer with this guy" only makes your customers 
have worse latencies and paths to other people, making the Internet 
less healthy.

Thanks,
Rucas

PS: sorry if I sent this twice; client lagged a bit.