4bpp
Now I am become a Helpful, Honest and Harmless Assistant, the destroyer of jobs
6mo ago·Edited 6mo ago
What this seems to suggest is that bureaucratic hurdles are also downstream from the threat of legal costs, much like the explosion of US medical expenses (mediated by insurance and certification costs). Could one put a lid on "dentist caused cosmetic damage, courts awarded more in damages than the patient will earn in a lifetime" scenarios that the US is famous for? Should one, given the tension with the other apparent failure mode being like "courts fine megacorp the statutory maximum of $1m for illegal practice that earns them >$1m per interval between successful court cases in profit"?
How do you reconcile the goal of having credible threats with which to make institutions follow the law with the goal of not incentivising institutions to realign themselves around the goal of mitigating that threat? It seems that the fundamental problem is that regulation rarely changes the topography of the incentive landscape per se - it just places spike pits into certain attractive valleys in it, making the incentive-followers strive to get as close as possible to the edge of the legal sanctions pit while not crossing the line. To make sure they actually don't cross it, they introduce ever more procedural requirements - the more you have, the closer to the pit you can venture while still feeling safe. The optimal institution is just barely on the safe and legal side, and has a mile-long paper trail to prove it.
Maybe this suggests replacing "sharp-edged" bans with "terraforming" taxes. Only, how do you sell that to the voting masses? In the FDA example, this would have to look something like "instead of making the FDA/its employees subject to legal penalty if they pass some threshold of neglect in approving a drug that passes some threshold of side effects, tie their funding/salary to the volume of side effects", and, yes, accepting that some whistleblower will report a decision was made that looks like "yes, we figured some patients would get birth defects, but in expectation the funding cuts looked better than the amount of people we would need to divert to shepherd additional tests".
To make sure they actually don't cross it, they introduce ever more procedural requirements - the more you have, the closer to the pit you can venture while still feeling safe.
But then you wouldnt take on new procedural costs that exceed the benefit of getting marginally closer. Total procedural costs would be bounded by the difference in profit between sitting precisely short of the edge and the best spot thats distant enough to be safe on its own. Its weird that this would be so large.
Maybe this suggests replacing "sharp-edged" bans with "terraforming" taxes.
I think a lot of regulatory burden comes simply from the sheer number of requirements you need to consider. Theres a sort of phase transition where its not worth to consider any course of action besides those established as ok, because the legality is too complicated. Even requirements that are naturally tax-shaped often are done with a sharp cut-off to limit the number of people who have to think about it, and conversely, smoothing existing edges without loosening standards in some place means more people have to deal with it.
yes, we figured some patients would get birth defects, but in expectation the funding cuts looked better than the amount of people we would need to divert to shepherd additional tests
Why would they avoid diverting people? If anything, management likes to maximise their number of subordinates. Whatever the merits of the smooth regulations in general, I dont think you can correctly steer the state bureaucracy with them. Frankly, the expectation that a legislature can do that at all seems crazy to me.
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Notes -
What this seems to suggest is that bureaucratic hurdles are also downstream from the threat of legal costs, much like the explosion of US medical expenses (mediated by insurance and certification costs). Could one put a lid on "dentist caused cosmetic damage, courts awarded more in damages than the patient will earn in a lifetime" scenarios that the US is famous for? Should one, given the tension with the other apparent failure mode being like "courts fine megacorp the statutory maximum of $1m for illegal practice that earns them >$1m per interval between successful court cases in profit"?
How do you reconcile the goal of having credible threats with which to make institutions follow the law with the goal of not incentivising institutions to realign themselves around the goal of mitigating that threat? It seems that the fundamental problem is that regulation rarely changes the topography of the incentive landscape per se - it just places spike pits into certain attractive valleys in it, making the incentive-followers strive to get as close as possible to the edge of the legal sanctions pit while not crossing the line. To make sure they actually don't cross it, they introduce ever more procedural requirements - the more you have, the closer to the pit you can venture while still feeling safe. The optimal institution is just barely on the safe and legal side, and has a mile-long paper trail to prove it.
Maybe this suggests replacing "sharp-edged" bans with "terraforming" taxes. Only, how do you sell that to the voting masses? In the FDA example, this would have to look something like "instead of making the FDA/its employees subject to legal penalty if they pass some threshold of neglect in approving a drug that passes some threshold of side effects, tie their funding/salary to the volume of side effects", and, yes, accepting that some whistleblower will report a decision was made that looks like "yes, we figured some patients would get birth defects, but in expectation the funding cuts looked better than the amount of people we would need to divert to shepherd additional tests".
But then you wouldnt take on new procedural costs that exceed the benefit of getting marginally closer. Total procedural costs would be bounded by the difference in profit between sitting precisely short of the edge and the best spot thats distant enough to be safe on its own. Its weird that this would be so large.
I think a lot of regulatory burden comes simply from the sheer number of requirements you need to consider. Theres a sort of phase transition where its not worth to consider any course of action besides those established as ok, because the legality is too complicated. Even requirements that are naturally tax-shaped often are done with a sharp cut-off to limit the number of people who have to think about it, and conversely, smoothing existing edges without loosening standards in some place means more people have to deal with it.
Why would they avoid diverting people? If anything, management likes to maximise their number of subordinates. Whatever the merits of the smooth regulations in general, I dont think you can correctly steer the state bureaucracy with them. Frankly, the expectation that a legislature can do that at all seems crazy to me.
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