> To counteract the financial incentives of shareholders (which result in bridges collapsing or data breaches) with the financial and legal incentives of a special class of employees - licensed engineers.
But now you have a special class of employees whose incentives are wrong in the opposite direction. They make decisions that are overly conservative, because they lose their license if the bridge collapses but by design no one can overrule them if they unnecessarily make the bridge cost four times as much.
This not only makes the bridge cost many times more, it thwarts the original intention because now building new things is so expensive that we avoid doing it and instead continue to use the old things that are grandfathered in or maintained well past the end of their design life, which is even less safe in addition to being less efficient. This is why so much of our infrastructure is crumbling -- we made it prohibitively expensive to build new.
> This type of licensing model has worked wonders in civil engineering, electronics engineering, law, medicine etc in improving safety standards for the public.
And these things are now unaffordable as a result. Ordinary people have been priced out of legal representation and are being bankrupted by medical bills. It's not a solution, it's just a new problem.
> Think letting the victims of the bridge collapse suing as the only method of preventing bridge collapses. This is not how things operate.
The reason this doesn't work in that specific case is that the damage from a bridge collapse can easily exceed the entire value of the bridge-building company, so then if you go to sue them they just file bankruptcy. Which they know ahead of time and then don't have the right incentives to prevent the damage. That hardly applies to the likes of AT&T, which is not going to be bankrupted by a large damages award, but is going to want to avoid paying it out.
> In sue-after model the responsibility before an accident has happened to make the product safe is quite diffuse across the whole organization, and the decision makers (C-suite) do not in fact have the expertise to determine if the product is unsafe.
Neither are they expected to. They're expected to hire someone who does, but then they have the incentive to balance the cost against the harm, so they neither end up with the incentive to abandon quality nor the incentive to make everything prohibitively expensive.
A real issue here is limited liability. The CEO comes in, hires low quality workers or puts them under unreasonable time constraints, gets a bonus for cutting costs and is then at another company by the time the lawsuit comes. Forget about licensing, make them personally liable for what happened under their watch (regardless of whether they still work there) and you'll get a different result.
Limited liability should be for shareholders, not decisionmakers.
That way the same party suffers both in the case of unreasonably high costs and in the case of unreasonably low quality and doesn't have a perverse incentive to excessively sacrifice one for the other.
>But now you have a special class of employees whose incentives are wrong in the opposite direction. They make decisions that are overly conservative, because they lose their license if the bridge collapses but by design no one can overrule them if they unnecessarily make the bridge cost four times as much.
This is not a bug. Having fewer bridges that don't collapse is better than having one fall over every day which is what's happening with data leaks now.
We now have < 10 megabanks in the US, any of which can bring down the entire US economy.
Instead , we could have 1000s of smaller banks. Tons of smaller banks is the natural state of things, like restaurants. This was true before the banking cartel, TARP, ZIRP, most recently, PPP (genius backdoor to bail out wall st.). In such system, any 1 collapsing bank wont bring the entire system down.
Having fewer bridges means that inevitable when they collapse, there will be far more victims and the event will be catastrophic.
Tech is one of the few bright spots in our moribund economy. Don't introduce a cartel that will blow up eventually.
It isn't safer to make building new bridges prohibitively expensive, because the result is that new bridges don't get built and then existing bridges are overused and extended beyond their design lifetime. And they're carrying several times more traffic when they ultimately fail.
It's the same for all the rest of it. You're not helping people to nominally make something better unless the better thing is actually available to them.
No, because making bridges prohibitively expensive means you are mono-culturing engineering.
You are only succeeding at keeping 1 engineering firm alive, who can afford to bid and build mega-expensive projects.
Eventually, the megafirm will adopt poor practices. And now, those practices will literally spread out across every single bridge built in the world. You now have a mono-culture of engineering that includes cancer as part of its DNA. Congratulations - you have granted a monopoly to a firm that sells ticking time bombs to your own citizens
This is, in essence, NASA, banking, Fannie/Freddie.
Errors are a part of nature. They must happen. We are humans and fallible. The question, when errors do happen, how big and hurtful will they be? Small or big ?
You can't buy your way out of human error and hubris. This is the fatal conceit.
This is the excuse used to justify the regulatory capture. There is a mile of difference between simply having fire exits vs. minimum parking requirements, de jure or de facto minimum unit sizes and density constraints. You need something that can distinguish these things, not something that provides the trash choice between none of them or all of them together.
Using regulatory capture as an excuse why we can't stop babies from eating lead is the most brain dead take from the American left since they replaced class with race.
But now you have a special class of employees whose incentives are wrong in the opposite direction. They make decisions that are overly conservative, because they lose their license if the bridge collapses but by design no one can overrule them if they unnecessarily make the bridge cost four times as much.
This not only makes the bridge cost many times more, it thwarts the original intention because now building new things is so expensive that we avoid doing it and instead continue to use the old things that are grandfathered in or maintained well past the end of their design life, which is even less safe in addition to being less efficient. This is why so much of our infrastructure is crumbling -- we made it prohibitively expensive to build new.
> This type of licensing model has worked wonders in civil engineering, electronics engineering, law, medicine etc in improving safety standards for the public.
And these things are now unaffordable as a result. Ordinary people have been priced out of legal representation and are being bankrupted by medical bills. It's not a solution, it's just a new problem.
> Think letting the victims of the bridge collapse suing as the only method of preventing bridge collapses. This is not how things operate.
The reason this doesn't work in that specific case is that the damage from a bridge collapse can easily exceed the entire value of the bridge-building company, so then if you go to sue them they just file bankruptcy. Which they know ahead of time and then don't have the right incentives to prevent the damage. That hardly applies to the likes of AT&T, which is not going to be bankrupted by a large damages award, but is going to want to avoid paying it out.
> In sue-after model the responsibility before an accident has happened to make the product safe is quite diffuse across the whole organization, and the decision makers (C-suite) do not in fact have the expertise to determine if the product is unsafe.
Neither are they expected to. They're expected to hire someone who does, but then they have the incentive to balance the cost against the harm, so they neither end up with the incentive to abandon quality nor the incentive to make everything prohibitively expensive.
A real issue here is limited liability. The CEO comes in, hires low quality workers or puts them under unreasonable time constraints, gets a bonus for cutting costs and is then at another company by the time the lawsuit comes. Forget about licensing, make them personally liable for what happened under their watch (regardless of whether they still work there) and you'll get a different result.
Limited liability should be for shareholders, not decisionmakers.
That way the same party suffers both in the case of unreasonably high costs and in the case of unreasonably low quality and doesn't have a perverse incentive to excessively sacrifice one for the other.