January 31, 2024

Self regulation

Is it Boeing or is it our trust that companies are able to self-regulate that is the cause of the current quality control problems?

Of course it is both. "Companies" are not real things, they are just a localized collection of people and capital. Firms are not driven by doing well or not doing well, they are driven by a complex assortment of profit making and economic and social hedging.

Boeing planes made in one shift are different than Boeing plans made in a different shift where different people are involved. It is an industry that does more than most to standardize these production forms across time, but corners are cut and mistakes are made.

Poor quality products roll off assembly lines all the time. It can be at a lesser rate at highly regulated industries like airlines, but the idea that firms go above and beyond (their profitability goals) is just nonsense.

We all inherently know this and yet we are currently all pretending that perfection is achievable through a system that is self-regulated so we can continue to talk about "Boeing".

The issue is not just Boeing. It is the regulatory oversight and frameworks that check (and re-check in this case) production of machines and goods that can cause mass casualty events.

There are many we produce that are like this. Food, trains, bridges, shipping boats and containers, car assembly, ports, waterways, water systems, chemical production facilities, toy makers. The list is almost endless.

In all these industries we have had accidents that have resulted in mass casualties. And, in every one of these events we can see the work of deregulation in the attempt to come as close to but not cross the "not crappy enough to kill lots of people" line.

It is a strange inter-play when you step back from it. Why are we trying to cuddle-up to minimum levels of regulation and oversight when people's lives are at stake?

Just ask Toyota that just recalled a huge number of vehicles, but only after over 30 people have been killed by shrapnel from defective airbags.

It costs money to recall defective products. But, it costs more money to ensure all parts are not defective in the first place.

That more money is really more jobs, in the private firm to make sure that things work and in the regulatory bodies that are mostly public sector.

Decades of cuts to regulation, the introduction of the nonsensical and contradictory notion that firms can regulate themselves. It is not your imagination, there have been an increase in the number of these kinds of accidents caused by defective inputs and poorly assembled products.

There is now an additional problem we have to face: the introduction of AI in the regulation and oversight systems.

The introduction of AI systems could be a way to increase the quality checking mechanisms. However, under capitalism and a deregulated safety regime, firms have the incentive to replace workers as opposed to augment their work.

Never mind that these AI systems are themselves unregulated.

In the rail sector, this means self-regulated firms implementing their own automated inspection systems. These systems introduce new errors while correcting others. There is no doubt that some of these technologies could be useful, but they are not tested and their implementation is too often driven by the goal of eliminating workers rather than increasing safety of their systems.

Rail is almost entirely self-regulated. Rail companies basically write their own regulations. So, we have a dual problem. Regulations are too lax and self-regulation means more corners are cut.

An example, regulations are so lax that the review of the East Palestine train wreck shows that companies are in compliance with regulations. Wayside detectors that could have prevented the accident were not working, but are unregulated.

Aviation has more regulation, but is also pushing to implement AI and automated systems for checking to replace workers doing this checking.

Regulation problems, not accidents

It isn't always over-regulation when no bad things happen.

While we must blame companies for these failures, we must focus on the correct problem.

Capital have pushed to reduce the "regulatory burden" they face. Governments have entire departments and laws ensuring only a reduction of regulatory burden where they carefully measure the cost of regulations.

Canada has a one-for-one regulation policy, where if a regulation is brought into an industry, a regulation must be removed. It is a ridiculous notion that if we find a problem that we must regulation, we must also remove another safety program that prevents other known problems happening.

This is the recipe for the disasters that we are seeing with greater frequency. Regulations are not something top of mind except after a disaster, but we must push to reverse this mindset.

As we bring in new technologies and live in increasingly more complex production and infrastructure environments, and as we move towards more environmental, health, and infrastructure crises caused by under-regulation, an answer must be to increase regulation.

This means increasing state capacity to understand the current complexities of production, but also the means to oversee and correct those issues before they result in accidents.