Folks: I’ve drafted a book review of The Death of Common Sense and would appreciate comments/corrections. (It will be very interesting to see what kinds of ads Google finds relevant to this article, perhaps a good guide to who has a financial interest in the status quo.)
21 thoughts on “Book review: The Death of Common Sense”
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I read it over a decade ago and I don’t remember most of the details, but this was a very good book.
Seems to me, this is a chronicle of “Do No Harm” taken to an extreme.
It’s well known that people fear losing $1 much more than they value gaining $1. People will spend more energy on not losing than gaining. And this becomes more extreme as they have more to lose.
So we demand laws and regulations that make SURE nothing ever gets worse, in any way, by any amount. (We can sue for damages. Harder to sue for lost opportunities.)
I wonder, is this truly death of common sense, or nonsense that is all too common?
Philip, it sound like an interesting book, but I fear you may lose anyone who has shopped for a Manhattan studio or 1br apartment right here:
“The government essentially mandates that Americans live like rich people (spacious apartments with all modern conveniences) but then poor people can’t afford what is mandated so they end up on the street.”
Maybe more detail is called for in that section.
I too read the book over a decade ago, your review was excellent.
“A large POISON sign dominates one side of a storage shed filled with bags of something hazardous. It turns out to be sand. OSHA categorizes sand as poison because sand … contains a mineral called silica. Some scientists believe that silica, in conditions found nowhere except in certain grinding and mining operations, might cause cancer.”
This is very misleading. The severe hazards of breathing fine silica dust are widely recognized (have been for thousands of years), and they occur in more than “certain grinding and mining operations” (e.g. abrasive blasting, drywall sanding, concrete cutting, etc.).
http://en.wikipedia.org/wiki/Silicosis
http://www.cdc.gov/niosh/topics/silica/industry.html
http://historymatters.gmu.edu/d/5089
“Brick manufacturers dutifully began sending out the MSDS form, which describes, for the benefit of workers, how to identify a brick (a “hard ceramic body… with no odor”) and giving its boiling point (above 3500 degrees F).”
The MSDS might also indicate that the brick contains silica sand which would be very important information to anyone cutting the brick.
However, the fact that Mr. Howard doesn’t seem to know what he is talking about vis a vis occupational health and safety (OSH) doesn’t mean his conclusion is incorrect. OSHA is not really a major burden on employers. Nonetheless, many of the burdens it does impose don’t contribute much to actual health and safety. Perhaps worse, OSHA does not effectively address many (most?) real health and safety issues.
Some kind of government intervention is appropriate for many OSH issues because they represent externalities or there is an information imbalance between the market players. I think the solution is (at least partly) fewer much simpler rules (targeted at the appropriate “level” in the chain of production), much more severe penalties for breaking those rules, and a system for collecting and disseminating “best practice” information which doesn’t lend itself to rule making.
The “MSDS for a brick” example cited in the review provides an instructive example. The existing system is designed to work as follows:
1) Manufacturers of bricks produce and provide a multi-page MSDS indicating (among other things) that they contain silica sand.
2) All employers using bricks are to review their MSDS (they have nothing better to do).
3) Employers engaged in brick cutting activities are supposed to find the one piece of relevant information (the bricks contain silica sand) among three pages of irrelevant garbage.
4) Those employers perform air monitoring costing thousands of dollars to determine if their employees are exposed to hazardous levels of silica dust.
5) If the air monitoring indicates hazardous dust levels, the employer must figure out how to protect the employees and provide that protection.
This system creates an unnecessary burden (employers who use bricks but do not cut them must still review the MSDS) and doesn’t effectively protect employees (many employers engaged in brick cutting won’t actually make it to step 5). A better system might work as follows:
1) The National Institute of Occupational Safety and Health (NIOSH) hires a few grad students to perform a definitive study on silica exposure during brick cutting operations.
2) If that study indicates an exposure hazard, OSHA requires all brick cutting saw manufacturers to equip all saws with water sprays to control the dust. Dry cutting bricks is prohibited. (Currently, OSHA can require employers to use only water equipped saws but lacks statutory authority to regulate the saw manufacturers). An alternative would be to ban silica sand in bricks.
3) Anyone caught dry cutting bricks (employee, supervisor, and company President) goes to jail for a night.
We would still need a procedure for dealing with the edge cases where wet cutting is truly not feasible, but that would be rare so we could tolerate a more burdensome approach.
From an Amazon review:
Howard may as well have titled his book “Attack of the Wheel-chairs.” For, like many doctrinaire conservatives, his exemplars of evil are the disabled, and especially disabled children, who are “lording it over” the rest of us, no doubt to the surprise of the average reader. “The disabled lobby is waging warfare against every other citizen,” he wails. It is they who bring building projects to a halt. Mothers of disabled children are bankrupting schools with their unreasonable demands, he continues…
—-
Does he actually say that the disabled “lord it over” the rest of us, in the book? He can’t be serious.
All the anti-regulatory material you start off with prompted the reaction: sure, regulation can be inefficient, but do we really want a return to the days of the Triangle Shirtwaist Fire and The Jungle? You need to balance the costs of regulation with the costs of no regulation.
But later on, it seems as if Howard is not a libertarian. He wants a more effective and efficient government. Who could argue with that? But then the question is, why is our current system of regulation sclerotic and what can be done about it?
Some of the examples suggest that individuals in government should have more power and be less constrained by rules. He admires the sweeping changes of the New Deal. Would you be comfortable with a Roosevelt-like figure who cut through all the bureaucracy with the force of his will? (some people expected Obama to be like this, for good or ill, but he fizzled and turned out to be a black Bill Clinton). Or China, run by a corrupt but efficient oligarchy? How about France, with a dirigiste state that can impose efficient public transportation and nuclear power at reasonable cost?
It is hard to imagine these solutions working in present-day America, because the right has whipped up distrust of the government to such an extraordinary level.
Ryan: You may think of a Manhattan studio as cramped because it doesn’t have enough space to host a Superbowl party, but it is much larger (and therefore more expensive) than what a single worker actually needs and what a single worker actually occupies in many parts of the world (including the U.S. nowadays, where immigrants divide up a standard 2BR apartment into housing for 8 men).
Neal: Sawing bricks all day probably is kind of hazardous, but I don’t think that the average brick gets sawed. I’m not sure the dust from sawing the occasional brick is that much worse than the particulates that most of us ingest from living near cities.
Goddinpotty: I don’t think it is fair to say “the right has whipped up distrust of the government”. As the government is now nearly 50 percent of GDP (source), the average American has daily interaction with the government and will decide for him or herself whether or not the government is trustworthy and/or efficient. As for returning to the days of “The Jungle”, government regulators might attribute our improved living and industrial conditions to their benevolent efforts, but how do we know that improved living and industrial conditions aren’t simply the result of a wealthier economy?
philg: I have done enough silica monitoring to tell you that dry cutting sand containing bricks all day would definitely be very hazardous. You are correct that cutting an occasional brick is not a significant hazard. In this diverse economy there are employees at both ends of this exposure spectrum and all points in between. However, it was not my intention to imply that brick cutting is a widespread occupational health hazard. I was merely trying to dramatize the combined inefficiency and ineffectiveness of the current approach using an example provided in the review.
Goddinpotty & philg: Figure 2 (p 26) of:
http://www.econ.ucla.edu/costa/risk10.pdf
and “Workers Fatally Injured on the Job” (p 175) of:
http://books.google.com/books?id=1ixRxAsdLKwC&pg=PA175&lpg=PA175&dq=occupational+injury+rate+1950+1960+1970+1980+1990&source=bl&ots=64oYz0R1In&sig=-Ukon-xJM3x0vxlxpK7MoS_o4uc&hl=en&ei=UwKTS5rML4bUsQO6rOD8Aw&sa=X&oi=book_result&ct=result&resnum=6&ved=0CBkQ6AEwBTge#v=onepage&q=&f=false
both suggest that factors other than OSHA (established in 1970) are primarily responsible for the long term improvement in workplace safety. However, it is not really accurate to claim that it’s only the result of a “wealthier economy”. The creation of the workers compensation system earlier in the century (by state governments) helped to internalize occupational health and safety costs and gave industry an incentive to improve conditions. Wartime (WWII) occupational health and safety initiatives initially sponsored by the government probably contributed to those trends. The government has certainly funded much (most?) of the research that has given us our modern understanding of environmental and occupational hazards. Government action eliminated the use of lead in gasoline (maybe the single most important environmental improvement… ever). Government regulations drove (or at least catalyzed) the dramatic decline of employee exposure to carcinogenic vinyl chloride monomer.
As for returning to the days of “The Jungle”, government regulators might attribute our improved living and industrial conditions to their benevolent efforts, but how do we know that improved living and industrial conditions aren’t simply the result of a wealthier economy?
If there are no rules and workers can’t sue, then occupational deaths (and consumer injuries from defective products) will be externalities and will rarely be addressed by private interests.
A good (if rarely discussed) example: until the early 20th century food and drug acts passed, there was a thriving quack patent medicine industry that caused untold numbers of people to suffer either by actively poisoning them or by leading them to forgo effective treatments. Then we had about 70 years of tight regulation when people couldn’t make unsubstantiated claims about medicines, followed by the passage of the “alternative medicine” deregulation law in the 1990s. Now that “natural supplements” are hardly regulated at all, the quacks are back in full force (this crap takes up about a third of the floor space in my local Whole Foods) despite the fact that our economy is much wealthier than it was when they were banished the first time.
It’s appropriate to analyze individual rules to see if they do more harm than good, and to ask if the rule-writing apparatus is pursuing its mission in the best way. But the fact is that externalities can cause huge public damage and a strong regulatory structure will always be needed to deal with them. And keeping the regulations in place and effective will always be a struggle because getting around the rules will always be in the interest of powerful industrial interests.
ez: There were rules and workers did sue. The “rules” were what is called Common Law and they held negligent people and companies responsible for the reasonably foreseeable consequences of their negligence. Due to a large number of big lawsuits won by workers, companies lobbied their pals in the government to strip workers of their right to sue employers when injured. The court system was replaced with Worker’s Compensation. A company whose negligence results in a worker losing an arm has to pay a statutory amount that is a tiny fraction of what they would have had to pay under conventional Common Law.
philg: Under common law companies had a lot of defenses to use in court (e.g. fellow-servant rule, assumption of risk, contributory negligence). There was also the difficulty of proving negligence in court. After all, there were no regulations to define the line between acceptable and negligent behavior. Serious mishaps can even occur when no one is negligent. The result was that most workers received little or no compensation for injuries (even less for illnesses); the common law system did not effectively internalize the cost of occupational injury or illness.
It is a good review. It would be nice to here the other side of these anecdotes.
Spending time abroad in developing countries made me appreciate the US government’s tireless efforts to make everyday life safe: from escape lighting in the theater to an elevator or subway that is more or less guaranteed not to remove limbs from hapless passengers.
And the 110% overhead for DoD travel? It would certainly be nice to pay less for a system relatively free of graft and corruption.
$1000 toilet seats made to military specs are indeed assinine. But the alternatives can be worse: toilet seat oligarchs.
Neal: I didn’t say that the Common Law system was fair or predictable, nor that every injured worker was compensated. It worked a lot like our current medical malpractice system. Some injured workers received windfalls; some received nothing. Some negligent companies paid nothing; some companies who were innocent of negligence paid enormously. Overall the system was frightening to employers and the trend was toward larger and more certain recovery by workers. They managed to halt the trend and obtain immunity from liability while politicians were able to claim that they were doing something wonderful for workers.
philg: Exactly. Workers benefited by timely and certain access to medical care and (partial) income replacement. Employers benefited by a more predictable cost structure. The economy as a whole benefited by lower transaction costs and improved internalization of injury and illness costs. Yes, each side also gave up something in the compromise, but overall the workers compensation system was a brilliant win-win-win innovation for its time. The problem is that we no longer live in that time.
It’s funny there isn’t more discussion of the workers compensation system. My interview question estimate is that it’s three times larger then the medical malpractice system we hear so much about and 200 times larger then OSHA. The system suffers from the same malaise that you have pointed to in other parts of the economy. Entrenched interests have figured out how to bend the system to their own benefit. Our complex and fast moving economy demands higher performance than the existing systems and institutions are capable of, and the basic structure of the system does not give players enough incentive to make the necessary improvements. The application of state power enables politicians to put off the inevitable day of reckoning. Those are really the central problems we face – the death of common sense is just one visible symptom.
Our grandparents and great grandparents came up with imperfect solutions to the new challenges they faced, but comparing the worlds of 1900 and 2000 one could argue they did pretty well. I suspect that the true solutions to our new challenges look even more different from what we have today than workers compensation does from common law. I certainly hope we are up to finding them.
Neal: The question was not whether worker’s comp is better or worse than the Common Law protections that predated it. My response to “ez” was directed at the assertion that, in the absence of a government that chooses how to spend nearly 50 percent of the citizens’ income, citizens have no rights, not even the right to avoid being killed by their employer. A smaller government does not necessarily imply fewer rights. In fact, as with worker’s comp, the government often takes away rights even when claiming to grant them. Advocates of smaller government, such as Libertarians, do not generally advocate eliminating the court system or the ability to get assistance from the state in enforcing contracts.
It seems we make most of our rules in order to prevent any exceptions. I can’t come before c, ever–so rather than make an exception we eliminate all exceptions, leading to massive unintended consequences.
Philip Howard’s TED talk “Four ways to fix a broken legal system”: http://www.youtube.com/watch?v=IWdzrZdRa38
I wouldn’t presume to know the best way to deal with the issues, but would like to point out that I learned in my West Virginia history class in middle school that sand can certainly kill you.
http://en.wikipedia.org/wiki/Hawks_Nest_Tunnel_Disaster
Depending on whose figures you use, the silica mining operation killed hundreds. If the upper figures are true (including those who were sickened and died later) it was one of the worst industrial accidents in the US.
Is there a happy medium somewhere between every brick having an MSDS and the time of a century ago when workers were often all but expendable?
Hi Phil,
The FAA is an interesting point about the death of common sense, because as you may already be aware, they already allow amateur-built experimental aircraft to be used in US airspace, and have done so for decades. So I think this would be an interesting place to look for results of regulatory meddling, since they have effectively been running two regulatory tracks at the same time: one heavily regulated (the certified market), and one very lightly regulated (the experimental amateur-built market).
Lest one think that there is not enough data to compare, here’s an interesting tidbit, which if true, should give you pause:
http://www.vansairforce.com/community/showthread.php?t=54838
If this is actually true, the fact that we’ve reached a point where more people are building small aircraft themselves rather than buying them from companies which presumably know how to do it better ought to indicate what the regulations have done to the growth of the “pre-built” industry.
As far as actual safety numbers, Ron Wanttaja periodically compiles amateur-built accident rates for both EAA Sport Aviation magazine and Kitplanes…I don’t remember the exact results, but I seem to recall them having something like 10-20% higher accident rates per hour than certified aircraft. But I don’t remember enough about the details regarding whether the statistics controlled for size or complexity of aircraft, or anything else for that matter.
Anybody else ever looked into the safety statistics between the two? Given this topic, I think this would make for a very interesting comparison…
Phil, great timing on this post, given that it is about a week before corporate / partnership taxes are due. Which highlights the insanity for those of us who read tax forms. I have a small partnership split between Vermont and Massachusetts that was started last year and consists of 2 partners – almost no revenue and tiny expenses. I now have 36 square feet of tax forms spread out across a series of desks.
To reduce my 36 square feet I am considering making a pile, but want to see what a committee has to say…