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July 26, 2010

Comments

Is there an alarm system that will awaken the poordead sods who sleep the big sleep with the fishes in the Gulf as a result of this criminal act?

I suppose we're going to be told that the workers asked for the alarms to be diabled because they weren't getting their beauty sleep on account of all of those midnight visits from MMS hookers flown in for a little ribald R & R.

Don Blankenship of Massey Ferguson and whomever ordered the disabling on Deepwater Horizon should tour the country together (bring the Twitter Queen of Wasilla along with) and speak at free-market stink tanks and for Republican candidates on behalf of abolishing the regulatory state.

The could press the live flesh for a change with Rand Paul or Sharron Angle over a potato salad potluck at the local Church of the Prosperity Gospel. Mayonnaise left out in the humidity for any length of time can kill your average tough guy turned murderer, but far be it from me to invoke the nanny state on behalf of the nanny goat f*ckers laying waste to their workforces.

Maybe an appearance at Reddeath for Error Irksome's annual goat f*ckoff and cracker licking contest would be in order.

They can appear with a few Southern Democrats
as well, for all we need them.

I picture the two freedom-fighters bunking together at a maximum security prison. Every five minutes all through the night a loud car-alarm will go off, followed by the voice of Moe Howard yelling "Wake up and go to sleep!", followed in turn by Curly Howard's high-pitched voice declaring "Oh ..... methane!"

I'm thinking THAT could be followed by Moe L*ne's (naughty words can't get through some servers) voice unctuously whining, as only snotnoses can winge, "No, you can't"

Two Moes for the price of one should lead to very little sleep.

Meh. Depending on the particulars, the value of a human life ranges from 0 to a couple of million. So, 13 dead times, say, 1.3 million equals about 17 million. I'd say that it was probably worth the risk of blowing those people up, particularly since it only happened once out of all the rigs out there with deactivated safety sensors. My car doesn't get very good gas mileage, y'see.

I don't know . . . this story sounds fishy. We were just assured the other day by McKinneyTX that this stuff almost never happens.

Well, there is that.

Then, if you add in the fact that the dead workers went directly from employment to death without passing GO and collecting unemployment, net/net, I'd say we're a wealthier, more productive society.

Well, I need to go because I have an appointment to kick a homeless person in the head.

Phil: I agree.

Even so, I think we all know who's to blame for this: the U.S. Government. Surely our superhuman Randian overlords couldn't be to blame. They would never cut corners to make a buck.

Since we know, axiomatically, that government is bad and industry is good, it's especially important never to try to improve anything.

The only solution to this is tax cuts, privatization, deregulation, and austerity. If we were just a bit more like Somalia this never would have happened.

Again, this isn't 'self-regulation'. The oil industry was one of the most highly regulated industries out there. (The other two that come to mind are insurance and banking for whatever that is worth). This was poor regulation. Or captured regulation. Or both.

Analyzing it as if it was unregulation run wild is missing a huge portion of the point. To get it right we need to develop systems or processes to make sure that we get good/uncaptured regulation.

Again, this isn't 'self-regulation'. The oil industry was one of the most highly regulated industries out there. (The other two that come to mind are insurance and banking for whatever that is worth). This was poor regulation. Or captured regulation. Or both.

Isn't this behavior indicative of how the industry would act if it were unencumbered by regulation? I think it's hard to make the argument that they'd install a bunch of safety equipment and use it if they weren't regulated, but since they've been ineffectively regulated they are haphazard and careless.
So while the rig wasn't regulated, the incidents there suggest that deregulation is not the answer. And while you may not be making that argument, there are plenty of people who are.

Carleton,

Isn't this behavior indicative of how the industry would act if it were unencumbered by regulation? ...And while you may not be making that argument, there are plenty of people who are.

Exactly right.

Indeed, it is a staple of conservative/libertarian thinking that companies have all kinds of incentives to emphasize safety, so regulation is redundant. Never mind that history refutes this notion decisively.

Again, this isn't 'self-regulation'. The oil industry was one of the most highly regulated industries out there. (The other two that come to mind are insurance and banking for whatever that is worth). This was poor regulation. Or captured regulation. Or both.

That's why I said:

We should not trust industry to regulate itself, and we desperately need to add teeth and effective enforcement to our existing regulations.

The last time I wrote one of these posts - where I listed "capture" and ineffective regulation along with self-regulation/deregulation - you made the same point.

But, again, I would point out that I made a list. De-regulation and self-regulation belong on the list of discredited ideas for the reasons CW pointed out.

But they were not the focus here, as indicated by the list.

'Trust but verify' is a concept brought into the world by Lenin (who claimed that he learned it from his granny though). The last thing we need is to introduce an idea by the commie archdevil (even if Saint Ronnie supported it).
---
On the other hand I know that very problem of alarms going off unprovoked on a regular base. At the university lab where I spend several years there was a carbon monoxide sensor that sounded the alarm at least once a day. If there had been a real leak one day then I fear many would have simply ignored it assuming it to be another false.
So I fully believe that a similar situation could have occurred on the rig. The question remains what was done about it. By some reports I read the alarm was only disabled in the sleeping quarters not in e.g. the control room. That could imo be tolerated under some circumstances because the controller could raise the alarm manually.

"Isn't this behavior indicative of how the industry would act if it were unencumbered by regulation?"

Since one of the methods of the regulation has included tort caps on actual damages, I'd say no. [and to head off a fight about damage caps, I'd note the difference between an actual damage cap and a punitive damage cap].

"We should not trust industry to regulate itself, and we desperately need to add teeth and effective enforcement to our existing regulations."

You focus on hopeful outcomes, I'm trying to focus on systems. Each time you mention only the outcome you want, I focus on the systems because stating the outcome you want and getting it to happen aren't even close to the same thing. In fact, in much of the history of regulation, they are opposite things.

For example, insurance is one of the very most regulated industries in the world. Yet the AIG disaster still almost took down the world economy even more than the actual outcome. This isn't an anomaly. It isn't a lack of 'teeth'. And asking for 'effective' is much like appealing to the need for a lack of 'waste'. It sounds good, but isn't particularly meaningful.

When people talk about trimming the 'waste' from government as an important part of saving money on the deficit, it is always appropriate to pin them down on what they are talking about and the magnitude of savings they think they can get. When people talk about 'effective' regulation, it is always important to talk about what they mean by that and how they think they can get there.

Here's my simple proposal:

(1) Find the creep(s) in BP who signed off on working around the safety regulations.

(2) Send them to jail, in a real jail with no golf course or tennis lessons, for a long time.

Do that a few times and the effictiveness of your regulatory scheme will improve quite a bit.

As long as "teeth" means "a fine we can factor into our business model" this sh*t will continue.

If you're going to fine somebody, make it a human being, and take their own, personal money.

Make Tony Hayward pony up fifty million bucks. That will get his attention.

Better yet, hit them with the same criminal penalties they'd be liable for if they were acting as a private person.

Take their money and their stuff and send them to jail. Then they will pay attention.

For example, insurance is one of the very most regulated industries in the world. Yet the AIG disaster still almost took down the world economy even more than the actual outcome

This betrays a misunderstanding of what went wrong at AIG. AIG's insurance operations were regulated by NYSIC. The problem came from its CDS operations in the AIGFP arm, which was ineffectually regulated by the OTS as a result of regulatory arbitrage by AIG.

I haven't explained the acronyms because, frankly, if you don't know what they stand for then you have no business at all making assertions about what went wrong at AIG and why this proves that heavy regulation makes industries less safe.

What's sad ajay is that thanks to one too many 50 page papers on the state of the financial industry, I can.

I tend to agree with ajay.

Merely stating that an industry has a lot of regulations does not provide a helpful indication as to their efficacy.

Suffice to say, I am not in favor of tacking oon pointless regulations, and I am against caps on liability regardless.

But Seb, if you read Gristmill and other environmental publications, good, effective, common sense regulations are not hard to come by. They are hard to enact, and then hard to enforce.

Part of what needs to change in order to fix that is to change the underlying philosophy and language around regulation.

Unfortunately, the GOP is pushing in the exact opposite direction. This needs to be countered, repeatedly.

If sensors are sounding a false alarm routinely, and you can demonstrate that it is a false alarm, that indicates that the problem with the sensors needs to be addressed. Not by turning them off, or by ignoring them when they do sound. The sensors themselves need to be either fixed or replaced.

This is pretty basic stuff, really. But the problem (in my experience) is that the folks making the decisions on what to do have no knowledge of the real problems that the sensors are intended to address. To them, the sensors are just there because they have to check a box on a form from the regulator. So, since they are just going thru the motions, whether the sensors actually work is irrelevant to their decision process. Which produces a decision process which focuses on minimizing costs -- and fixing or replacing sensors is a cost.

Carleton:

"Isn't this behavior indicative of how the industry would act if it were unencumbered by regulation? I think it's hard to make the argument that they'd install a bunch of safety equipment and use it if they weren't regulated, but since they've been ineffectively regulated they are haphazard and careless."

Sebastian:

"Since one of the methods of the regulation has included tort caps on actual damages, I'd say no. [and to head off a fight about damage caps, I'd note the difference between an actual damage cap and a punitive damage cap]."

That was your response to Carleton, but I do not see how it addresses his point; it seems like a non sequitur. Carleton pointed out that the existing regulation required BP/Deepwater/whomever to provide working alarm systems, but BP/Deepwater/whomever knowingly disabled the legally required alarm systems anyway. But you think this does NOT indicate that BP/Deepwater would have behaved this irresponsibly, absent the regulation? If so, why not? This seems analogous to watching a kidnapping trial and suggesting that the real problem is all the antikidnapping laws.

Russell, I agree, but everything will end up being put in a business model anyway. The problem I see is that the fines and punishments are not sufficiently (as you say) prohibitive. I am in favor of being punitive to individuals because it's personally gratifying, but I think we'd have more luck if we just took more of the company's money. Every decision these companies make is a CBA, right? Let's just make the costs sufficiently high that they will transgress less.

I realize that I am sort of arguing for a Laffer curve of punitive regulation; please be patient with my oversimplifying.

Don Blankenship did indeed recently say a public 'fuck you' to federal regulations on gas build-up detectors in his exploding West Virginia mines, saying he knew better what types of detectors and where to place them than a bunch of damn nosy byurokrats and he should have defied and sued more than he did.

Nice guy, he.

"Isn't this behavior indicative of how the industry would act if it were unencumbered by regulation?"

Since one of the methods of the regulation has included tort caps on actual damages, I'd say no. [and to head off a fight about damage caps, I'd note the difference between an actual damage cap and a punitive damage cap].

Are you saying "theoretically no" or "actually no"? That is, I can see where this could theoretically encourage risky behavior, but I don't see actual evidence that it did so here. Whereas, hydrofracking's exemption from the Clean Water Act probably does encourage risky behavior since it insulates from CWA-related lawsuits.
But I do know this- Norweigian and British deepwater wells have remotely-actuated secondary blowout preventers, mandated by law. Deepwater Horizon did not have such a unit. I don't see any hideous complexities in mandating such a system, or (as Julian recommends) mandating larger fines for violations. I do see hideous *difficulties* in enacting such regulations in the face of hostility to government regulation and intentional neutering of regulatory agencies by the GOP (and some industry-friendly Democrats).

You focus on hopeful outcomes, I'm trying to focus on systems. Each time you mention only the outcome you want, I focus on the systems because stating the outcome you want and getting it to happen aren't even close to the same thing.... When people talk about 'effective' regulation, it is always important to talk about what they mean by that and how they think they can get there.

Surely the first part of the conversation is "what they mean by that", as you say- we're standing around the car wreck saying "that guy needs a doctor" and you criticize us, saying "Yes, but which hospital? And what proceedures does he need? There's no point in standing around saying he needs a doctor unless we're talking about those things too".
That is, surely we can agree that we do need more effective regulation and *then* proceed to a discussion about how to reach that goal. In the US, we are still having the first conversation.
And maybe one of the ways to start is not allowing fictive, sociopathic persons (ie corporations) the right to make unlimited political donations?

I am in favor of being punitive to individuals because it's personally gratifying

I get no jollies out of sending people to jail. I am in favor of punishing people because people are who do the harm.

The corporation is just a legal shell to limit the risk exposure of the investors.

"BP" is a legal construct. Some actual, tangible human beings made the decision and took the action.

If you or I did something *remotely* like that outside of the context of a corporation, our @sses would be in jail and we, personally would liable for some serious civil penalties.

Not to pick on Hayward specifically, but "failure" in his case is going to mean being eased out of his CEO seat with many millions of dollars in his bank account. Many millions. I'm sure his ego is bruised, but he'll never have to worry about a thing, ever again, for the rest of his natural life.

And the Gulf will be f**ked for years.

Seems kind of messed up to me.

Islam and Sharia law are inseparable in many Muslim communities and in most Muslim countries. Certain tenets of Islam, mandated or allowed by Sharia law, don't square with liberal democracy. Period. This is not a debatable point.

Agreed.

Eric, you quoted a passage from another thread by mistake, I think.

Er, damn stick control-c function.

Meant to agree with this:

That is, surely we can agree that we do need more effective regulation and *then* proceed to a discussion about how to reach that goal. In the US, we are still having the first conversation. And maybe one of the ways to start is not allowing fictive, sociopathic persons (ie corporations) the right to make unlimited political donations?

"That is, surely we can agree that we do need more effective regulation and *then* proceed to a discussion about how to reach that goal. "

We pretty much never seem to get to that second conversation around here, right?

Which is why I mention it repeatedly.

Grousing about more effective regulation is like complaining generally about waste. Sure it is 'true'. It just isn't very useful.

Sure it is 'true'. It just isn't very useful.

But the "truth" of that proposition is not the consensus. Not even close

There is a fierce debate, with roughly half of the population opposed to more regulation (at least, if you trust party affiliation to be an indicator of ideology). The GOP is pushing for widespread, systemic de-regulation and self-regulation - and, absent that, appointing industry insiders in the oversight roles.

Thus, it is very, very useful to first win the debate about whether or not we need more effective regulation. Then proceed to the details. Which, again, are out there. See comments above about cut off switches mandated in other countries, and the lack of stiff penalties for the frequent infractions that occur under existing regulations in the US.

We pretty much never seem to get to that second conversation around here, right?

What am I, chopped liver?

Every time the topic of corporate regulation / corporate money in politics / corporate whatever comes up, simple suggestions are put on the floor, by me if not by someone else:

Quit treating corporations like people under the law.

And:

Quit letting criminal or civilly liable behavior by actual people slide because it's done in their capacity as officers of / employees of a corporation.

That, in fact, *is* a conversation nobody wants to have. It's annoying.

And hell yeah, we are miles away from anything like a consensus that regulation, at all, is a useful or good thing.

I hereby appoint Russell as regulatory Czar in my Administration.

A recess appointment, but what the hoo-ha.

Further, I would love to take the results of a thoroughgoing discussion of regulatory practice, with recommendations and conclusions reached here at Obsidian Wings by sincere folks of our many persuasions, and feed them into the maw of our current discourse, which features Don Blankenship of Massey Ferguson at the National Press Club, and see what happens.

"Quit treating corporations like people under the law."

So, for example, the government can take property from corporations without due process of law, without the need of a public use, and without need for just compensation?

It seems to me you haven't thought of the implications very well unless you are more radically anti-corporation than you've previously announced.

"There is a fierce debate, with roughly half of the population opposed to more regulation (at least, if you trust party affiliation to be an indicator of ideology)."

And part of the reason they're opposed is because they've seen how bad regulations can get when people want to talk only about the ends they want without talking about the means. It is essentially the 'for the children' debate over and over and over again. Each side employs it for their hobby horses, and because 'for the children' does not actually justify half the junk it is used for, it pollutes the process.

A nice idea, or a good aim, or nice end, isn't good enough. It would be great to have Sweden in the Middle East. Invading Iraq is a poor method to get there. We'd like to cut waste from government programs. Worrying about it too much in a recession rather than getting stimulus in place is a bad idea.

Saying you want 'more effective regulation' is like that. There may be good or bad ways to get to 'more effective regulation'. Saying you want it to be more effective and listing 'more teeth' is not addressing the issues I'm raising.

Saying you want 'more effective regulation' is like that.

No, not when one half of the population is saying we want "no regulation at all." Then you have to clear a threshold where you can achieve some type of consensus that effective regulation is a good thing. Then have the debate about which regulations are, indeed, effective.

Don Blankenship of Massey Ferguson at the National Press Club

I hate to interrupt your flow, but Massey Energy is Blankenship. Massey Ferguson are a bunch of blameless Canadians who make tractors.

It seems to me you haven't thought of the implications very well unless you are more radically anti-corporation than you've previously announced.

Actually Seb, I've thought about it quite a lot, more than most folks I would imagine.

I'm not anti-corporation. I think they're swell. I just don't think they're people.

For the record, IMO it's completely appropriate for corporations to be able to own property and enter into contracts, and I think the government should not take property held by corporations without due process.

Those aspects of corporate privilege are of very long standing in our legal tradition and in common law, and in fact are inseparable from the purpose of corporations in the first place.

What I do not agree with is extending that limited privilege to the full standing of personhood under the Constitution.

That is a level of privilege which is most definitely *not* of long standing in our legal tradition or in common law.

Nor do I agree with extending the idea of limited liability to any and every action taken by any employee of a corporation.

Hopefully this disposes of the standard set of straw men.

We pretty much never seem to get to that second conversation around here, right?
Which is why I mention it repeatedly.

Feel free to front page a post about how we get to good regulation. Because frankly, you never get to this conversation either, afaict you just use it as a cudgel every time someone brings up how we need better regulation.
Physician, heal thyself.

So, for example, the government can take property from corporations without due process of law, without the need of a public use, and without need for just compensation?
It seems to me you haven't thought of the implications very well unless you are more radically anti-corporation than you've previously announced.

It seems to me that you're intentionally misunderstanding for the purposes of obstructing conversation.

A nice idea, or a good aim, or nice end, isn't good enough. It would be great to have Sweden in the Middle East. Invading Iraq is a poor method to get there.

There seems to be an implication here that achieving effective regulation is simply unrealistic. Invading Iraq is a poor method of putting Sweden in the Middle East, but there is no good method for doing that because it's an impossible goal.

I'm no expert on regulation or organizational dynamics, so it is probably impossible for me of determine fully what is or is not an effective regulatory regime. But there are people out there who are such experts. I think it's partly a problem of having regulations that will achieve a worthwhile goal if properly implemented (the regulations themselves), and partly a problem of the bodies tasked with implementing those regulations actually doing so over the necessary course of time (the organizational dynamics).

I've seem plenty of good suggestions on this site on both fronts in various threads, so I'm not sure why you think no one talks about such things, Seb. And you seem to agree that the stated goal of effective regulation is a good one, but you follow that up by complaining that no one talks about how to achieve that goal (when some people actually do, at least sometimes) while you, yourself, don't talk about how to achieve that goal. (Or do you, and I've just failed to notice, the same way you've failed to notice others doing so?)

Beyond what goes on on this site, the people who have good, expert suggestions on what regulations would be effective and how regulatory bodies should be organized seem to be ignored. Why is that? It seems far more likely that it's because there are people who fight regulations and proper enforcement because it's in their own perceived self-interest rather than because we here aren't coming up with all the solutions.

So, Seb, are you in favor of effective regulations, and do you think it's possible to achieve an effective regulatory regime, even if we, the commenters at Obsidian Wings, aren't necessarily capable of determining how to do so?

There seems to be an implication here that achieving effective regulation is simply unrealistic.

Maybe I've missed something, but I was under the impression that this has, in fact, been Sebastian's position all along: i.e., regulatory capture is inevitable (even moreso in the wake of Citizens United, a ruling that Sebastian wholeheartedly supports), so any attempt is pretty much doomed to fail, if not backfire egregiously.

The fact that Sebastian compares the idea of implementing effective regulations on corporations with that of "turning Iraq into Sweden" would seem to provide additional support for my assumption.

Or have I, in fact, missed something?

What Russell said (comment at 10:56 a.m. regarding hanging those responsible.)

After watching that same electronics guy tell his story on 60 minutes, to my very simple way of looking at it, the alarm wasn't the issue. I don't remember the specifics, but there are normally two cement plugs used when the mud is removed and they only used one. The BP guy overruled the Deepwater guys on the two plug issue. At that point, something should have happened (Deepwater guys call the feds? They jump up and down? They give the BP guy a pink belly?) Then the blow out preventer failed. Both very preventable causes of the blowout from what I've read. By the time the alarm sounded, I think it was just a tad too late.

As to who (feds vs. industry) would do a better job here is something I cannot tell. The feds ARE regulating the industry. The regs say test the BOP every two weeks. Here is an interesting article on the test of that very BOP before the blowout. On the one hand, it looks like there were enough signs that regulators should have taken a closer look. OTOH, BP left out some information in what it passed on to regulators. BP knew it had a problem with well control and still decided to remove mud without a second cement block, which, a lot of engineers seem to be saying was really, really stupid.

As for industry self regulation, it doesn't do a lot of good to shut down companies with exemplary safety records via a moratorium. Not being shut down, for one, would be a huge incentive to self regulate. At least let the "perfect" companies keep going.

El Cid: Why didn't you weigh in on the whole Cordoba House thing?

Also, Seb, sorry to pile on, but you did not yet address my comment upthread, and it seems like you did not read it.

You said:
"We pretty much never seem to get to that second conversation around here, right?

Which is why I mention it repeatedly."

But I posted about an hour beforehand that

"Russell, I agree, but everything will end up being put in a business model anyway. The problem I see is that the fines and punishments are not sufficiently (as you say) prohibitive. I am in favor of being punitive to individuals because it's personally gratifying, but I think we'd have more luck if we just took more of the company's money. Every decision these companies make is a CBA, right? Let's just make the costs sufficiently high that they will transgress less.

I realize that I am sort of arguing for a Laffer curve of punitive regulation; please be patient with my oversimplifying."

That's my attempt to have the second conversation.

Also, HSH, you do say "effective regulations" but that begs the question, as Seb has repeatedly noted, what an effective regulation is. Otherwise I strongly agree.

And part of the reason they're opposed is because they've seen how bad regulations can get when people want to talk only about the ends they want without talking about the means.

Not really. The GOP is, of late, opposed to regulation qua regulation, not because of any pragmatic objection but because of ideology.

Massey Energy, not Massey Ferguson. Thank you.

I expect a rash of tractor catastrophes soon, because the people-mulching alarm was factory disabled.

But I think Raymond Massey should play Blankenship in the mini-series, reprising his role in "The Fountainhead".

Also, HSH, you do say "effective regulations" but that begs the question, as Seb has repeatedly noted, what an effective regulation is. Otherwise I strongly agree.

I suppose, but you can't favor something, really, if you think it's impossible. You can also oppose even effective regulation, even if in the abstract and yet undefined, if you have an ideological distain for regulation of any sort (unless you consider no regulation to be a form of regulation that is effective, I guess). So I don't think it's an empty question, particularly when a large part of the discussion is already known to be figuring out how to regulate effectively. The point is whether or not we should bother trying (according to Sebastian, in particular, for the purposes of my question).

But I think Raymond Massey should play Blankenship in the mini-series, reprising his role in "The Fountainhead".

Or possibly Arsenic and Old Lace. "Let's kill people and steal their faces for my personal use!"

Sure we can have more effective regulation. It will probably require less delegation from Congress and more direct oversight. My problem with undifferentiated allusions to experts or the like is that general appeals to 'tougher regulations' and the like really don't integrate the insights about the reasons behind capture and inappropriate regulation that are available, nor does it talk to the remedies which public choice investigation have found.

For example, one of the problems in capture is that the industry will normally know exactly who is going to make what rule at what time. Often we try to counteract that with a commission with majority vote. This is a good start, but it incentivizes attempts at getting just enough regulation to get the majority and it pushes direct horsetrading if the minority has a chance, and exclusion of the minority entirely if it doesn't.

A better way is to make the commission draft a group decision with certain key break points of non-consensus outlined. These points are decided by just one member at the end of the process, but the identity of that member isn't known until the end of the process, and is chosen by lot at the end of the process. This pushes a strong incentive toward building as much consensus as possible, and pushes the regulated industry toward not pissing off the least friendly minority member because they might be making the key decisions at the end.

Lots of insights like that are available in public choice, but I'm pretty sure they aren't what you are talking about when you say that we should 'get tough'.

That just sounds to me like the "get tough on drugs" people, who don't understand the complexities and side-effects of their policy mandates.

Seb,

What gives you the impression that anyone wanting more effective regulation would reject your suggestions out of hand? They seem common sensical enough to me.

If so, why not just suggest them rather than criticize people calling for...better suggestions!

I have made precisely those suggestions before. They don't appear to have made an impression.

First time I've read them. And, again, I don't see those suggestions as antagonistic to this post, despite your initial comment on this thread that seemed so.

I guess his original post about how you'd totally got it wrong actually translates to "Eric, I quite agree with you, and I have some new ideas Id like to share about how we can reach that goal".

No. It translates to: you're focusing on the wrong thing and framing it that way is likely to cause serious short-sightedness.

Noticing that drugs can cause problems and saying that we need to get tough on drugs isn't the same thing. The latter gets us the ugly policies we have to today.

Noticing that a lack of regulation can be problematic and saying that we need to get tough on corporations isn't the same thing. The latter leads to bad policy, which is why I object to the frame.

Is that really what you said? No, you objected to Eric's (nonexistent) characterization of this situation as unregulated (even though he specifically said "we desperately need to add teeth and effective enforcement to our existing regulations").
You may have been *thinking* that, while correcting Eric's nonexistent error. But you haven't got around to actually saying so until now.

Mr. Wu, you haven't been particularly good at interpreting my comments recently. But I'm relatively sure that my very first comments on this thread were....

"To get it right we need to develop systems or processes to make sure that we get good/uncaptured regulation."

His focus is on teeth, I'm saying that starting from that focus isn't all that productive and is along the more typical regulation path that tends to create the problems we've already seen.

Some of the most stringently regulated sectors still go crazily wrong. It isn't a lack of regulation or a lack of aggressiveness or a lack teeth. What is needed isn't more tough guy style. So starting from that point isn't productive (from my perspective).

Anyway, I'm trying to be as clear as I can be. I feel like I over explain myself already, so it is odd to think that I'm underexplaining.

It's neither overexplaining or underexplaining, it's not explaining at all. Your first comment spends 7 of 8 sentences berating Eric for blaming this on deregulation. The 8th that you quoted just says we need to develop good regulation. That we were supposed to infer all of what you're saying now from that sentence- yeah, I guess that could be charitably called underexplaining...

To address your new and interesting point- teeth are also important; even a perfect regulatory regime designed by angels will not create compliance without sticks or carrots. In this case, it's possible (though unproven) that existing regs would've prevented the disaster, but the enforcement was so lax and the punishments so small that they were not followed.

It's possible that we also need better regulations, and that following existing regulations to the letter wouldn't have prevented this disaster. It would be foolish to assume that either is the case based on some ideological fixation prior to actually knowing the facts of the matter.

It isn't a lack of regulation or a lack of aggressiveness or a lack teeth. What is needed isn't more tough guy style.

As far as I can tell, you're making one pretty good point here Sebastian: the effectiveness of regulation is compromised by regulatory capture.

Noted.

And you make some reasonable and concrete process-level suggestions for how to avoid regulatory capture.

Also noted.

Also as best as I can make out, there's damned little difference between "effective regulation", "regulations with teeth", and "avoiding regulatory capture".

Avoiding regulatory capture is simply one of the ways in which regulations can be made more effective.

People who do harm should be accountable for the harm they do. Whether they do so in the name of or on behalf of a corporation, or not, should make no difference.

If anyone here finds that principle objectionable, please explain why.

Oh hey, can I offer a suggestion for avoiding regulatory capture? Hire enough people to actually DO the jobs, and well. Inspectors, regulators, etc. Including inspectors to make sure the people who are supposed to be the regulators aren't snorting cocaine off the bellies of the people they're supposed to be regulating. And if they are (or if they're less dramatically corrupt), fire them, and make some kind of public record of people who've been fired for corruption of that sort.

But, y'know, they'd be evil commie government workers making a zillion dollars an hour or something, so we can't have that.

they'd be evil commie government workers making a zillion dollars an hour or something, so we can't have that.

Well, we can always steal some of Brett B's money to pay for them . . .

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