As long as the incentives stay the same, I don't see how a change to, say, liability model, would make any difference. The regulator can still set legal penalties high enough to stop any innovation, if they want to.
Ideally there would be some positive incentive on the regulator as well as negative incentives. Perhaps somehow they could be responsible for the overall success of an industry, rather than just avoiding the negatives.
It's especially hard though when you are regulating foreign businesses. It might be dumb to prevent the Microsoft-Activision merger, but what incentive do UK regulators have to get it right?
If the incentives are all just politics then maybe the only real answer is politics, like the YIMBY movement seems to be somewhat effective at fighting anti-housing regulation. It is not really changing the paradigm per se, it is just changing the rules to be more pro-housing.
A liability model has a couple of advantages despite this:
1. The regulator has some slack to not set penalties insanely high. As long as they're seen enforcing those penalties against someone periodically, and as long as the penalties sound like a big number to the general public, they can look like Stern Serious Regulators who are doing their jobs properly. The difference between a $5M fine and a $10M fine can have huge financial implications, but to the political circus those numbers are both roughly the same size, i.e. big. This allows the regulators to be more reasonable if they want to be.
2. Using liability rather than specific procedural rules lets the people closer to the ground decide how to most efficiently mitigate risk. Suppose that you run a factory, and sometimes people get injured by careless operation of a rotary saw. A naive regulatory approach might be to require that an additional person be watching whenever the rotary saw is in use. And that would probably help with safety somewhat, though at great cost. But if the regulator instead just requires workman's compensation payments to be made when someone gets hurt, then you can try to figure out a better way using your own knowledge of how your factory operates. (Historically, the adoption of workman's comp laws led to factories hiring engineers to make the equipment harder to accidentally misuse. That rotary saw, for example, would have had a cheap guard retrofitted -- and that would improve safety much more, for a much lower cost, than the "have an observer at all times" rule.)
Regulation is intended to prevent human harm by setting and enforcing a safety standard.
2. If you look at IRBs, how much do you think Scott Alexander is going to be able to pay for liability insurance? The review model does have some advantages.
So there is some sort of equilibrium forming, not necessarily an optimal one, but the ratchet does loosen occasionally. For example, FDA has famously succumbed to public pressure and reformed its procedures for drugs for terminal diseases so that patients who have nothing to lose can accept much riskier treatment trials, to speed up development for such drugs.
I say it's not an optimal equilibrium because nobody incentivizes for the common good. Politicians should, but they seldom do. For example, the nuclear industry would lobby and pressure for rapid approval of their existing traditional methods, but they would, as a whole, be very aggressive against a startup with an innovative design. What better way to kill such a competition than to call your regulator, lay out your 'concerns' and bash the startup with thick rulebook, even if those rules are not at all relevant for the new thing, they still have to comply for a 'fair' playing field.
Yeah, in some ideal world things would work like that.
On the real world, there is also an strong incentive not to block the profitability of any powerful person, and your paragraph applies only to powerless ones.
A couple of decades ago, there was a strong movement on the governments to measure and publicize the societal costs of the regulators procedures. Leaded by the US and Germany. But then we got the stupidification of politics, that stopped it completely.
Of course the FDA is not, itself, a democratic instution. But then neither is your local police department or NASA. The reason those institutions are accepted despite the lack of direct democratic accountability is because they are still situated within the larger democratic institution (the US government) and subject to oversight by those elected representatives.
If you hate the FDA your best bet is to lobby against it yourself (or help others that do). Its to much of an in-the-weeds issue for it to be a high priority for most lawmakers (unless maybe you live in a district with a lot of businesses regulated by FDA)
Patient activists and drug companies lobby to make stonewalling approvals difficult.
Rather ironically, your naive perspective is precisely why “democracy” is a self-evidently failed system and there are clear arguments that it is also a counterproductive, intrinsically unsustainable, and self-defeating system.
They have just as many issues as any other regulating body. There's many ingredients that are deemed safe in the US that the rest of the world has banned.
Every regulating body has been compromised thanks to late stage capitalism.
> "I don’t know much about what happened in the ~60 years since Kefauver–Harris [1962]. But today, I think there is good evidence, both quantitative and anecdotal, that the FDA has become too strict and conservative in its approvals, adding needless delay that holds back treatments from patients."
There have been endless scandals since then related to lax oversight and failures of the process, such as Merck's Vioxx scandal (FDA approval despite evidence of heart issues, only taken off the market after what $10 billion in sales???), the Pfizer-Bextra scandal ($2.3 billion settlement), a whole host of cancelled shady experiments, e.g.
> "A research scandal that led to the shutdown of 75 human experiments at the University of Oklahoma medical school in Tulsa has brought the departure of three top university officials and dismissal proceedings against a scientist."
https://www.latimes.com/archives/la-xpm-2000-jul-22-mn-57464...
Then there's the movement of clinical trials overseas by the likes of Pfizer to avoid FDA scrutiny, and resulting $7B lawsuits by Nigeria etc.
https://www.theguardian.com/world/2007/jun/05/health.healtha...
If people are going to write articles calling for less regulation of clinical trials in the USA by the FDA, they should at least try to inform themselves on recent history.
We need less. Much less. At the very least we need to separate the concept of it being legal for doctors to prescribe a drug and mandatory for insurance to pay for a drug.
Right this minute, hundreds or thousands people are actively suffering and dying from rare diseases because it's ludicrously expensive to bring new medicines to market. We place blame - we file lawsuits - on someone who sells a drug that doesn't work or that causes harmful side effects, but we sag our shoulders and shake our fist at the uncaring universe when someone dies of a disease that wasn't worth $200,000,000 to force a guaranteed-safe treatment through FDA approval.
A medical review and approval process that must never, ever allow a single bad outcome through on pain of terrible, multi-billion-dollar scandals is guaranteed to cause bad outcomes, because not allowing good things to be approved is a bad outcome.
This would mean such drugs would not be exclusively licensed by any private entity, but instead could be manufactured and distributed by anyone that met quality standards, greatly reducing prices for consumers. See Linux etc.
they hired a new staff of administrators to wield the real power. These administrators had never done research themselves, had no particular interest in research, and their entire career track had been created ex nihilo to make sure nobody got sued.
Bad things happened.
Review-and-approve regulation happened, things improved.
Another bad thing happened, at a much lower scale.
Regulators cracked down, professional admins replaced experts, things got buried in red tape.
The author argues against review-and-approve but they don't present a better alternative than that first review-and-approve. They mention, but don't really endorse, liability law models. But today's adversarial legal model in the US is also slow, expensive, and results in tons of cover-your-ass legalese at large places.
The "ratcheting up" of the regulation enforcement seems like the much bigger problem here than an "review and approve" model itself. The need to look like you're doing anything to try to prevent bad things from ever happening.
We don't see that everywhere - we enforce speeding and reckless driving laws, but sometimes people still die from traffic incidents caused by those. The reaction hasn't been to put ten times as many cop cars on the road, or ubiquitous speed cameras. We did put in cameras for red lights, but those lost a lot of momentum and were pulled back in some places instead of rapidly turning into constant monitoring of everything about driving.
So is the problem just that politicians don't relate or understand something like a medical study as well as they do driving, and don't understand the tradeoffs and burden required to try to make sure nothing went wrong, ever? If anything, I'd expect that to result in industry lobbyists pushing deregulation to have a much easier go of it than they have. So I don't get it.
Then when nuclear power is invented and plants are built, the alternative is coal, not going without power. So when there are nuclear accidents, the regulators can go nuts and shut down plants, and prevent new ones from being built. Consumers don't care that much about what the source of their electricity is, and coal is the status quo, so no politician loses their seat for going back to it.
If nuclear power had been invented first, it and all its problems would have just been accepted as the cost of having electricity instead, and it would be extremely difficult to build coal plants.
They allude to no-fault workman's compensation laws, discussed at greater length in this excellent article:
https://rootsofprogress.org/history-of-factory-safety
The trick there was to take the liability out of the adversarial court system, by not requiring the injured party to prove that the employer was at fault -- only that they got injured somehow. And it worked much more reliably, with less ass-covering and less overhead, than the previous tort-based model.
Yes, it's that politicians and importantly members of the public don't relate. Driving is so ubiquitous in the US that almost everyone does it. Almost everyone with the ability to decide things in America or who has the time to lobby for something has been a driver and can empathize with a driver who was doing their best but encountered something unexpected on the road and ended up in a crash (note my usage of passive language, specifically to build up this frame-of-mind, even though in reality it isn't like this.)
The average American doesn't see themselves as the creators of new drugs nor do they see themselves as airline pilots. Even if the harms American perpetuate via driving are actually worse than the harms of the other two, without the ability to empathize as the creator of a drug or a commercial airline pilot, they're much more likely to favor heavy censure for wrongdoing for something they see as being done by someone else. It's a case of "Look grandma was trying her best when she accidentally crashed into the kid" vs "Those elites at Johns Hopkins trying to pull the wool over our eyes." The less likely the average American is to work a job, the more likely the average American is at heavily regulating that job.
It's a big problem with American regulations because everyday harms are swept under the rug while rare harms perpetrated by a minority are dealt with harshly.
Granted, even then I'm not sure what the solution is. (Well, at least assuming that employee owned corporations are mostly a non-starter in the US.)
Several of the arguments and sources given make only sense at first glance, e.g. the argument about the FDA would be more convincing if not for the fact that pharmaceuticals still spend as much on marketing (that's the conservative estimate) as on R&D (they even argue that giving away free samples should not count as marketing I kid you not https://www.raps.org/news-and-articles/news-articles/2019/7/...).
The arguments that anesthesists give a good example for a liability model because of some improvements made in the 90s, maybe makes sense from a purely US point of view. The question is (and this was not investigated in the source) how did the improvements compare in countries without the same liability but regulations. So would (or have) the same improvements being made with regulation.
Similay he brings up nuclear power and argues that liability would be a better model. Apart from the fact that the cost of nuclear vs renewables is not primarily driven by regulation (there was an analysis here on HN a couple of months ago, which I can't find on mobile atm), liability would kill nuclear in its tracks because no insurance would or could cover the potential cost a nuclear disaster.
Finally, why not talk about the FCC, a regulation agency which has made flying the safest mode of travel in the world. In fact if the aviation industry was as lax as the medical we had planes falling out of the sky multiple times a day. They only recently come under flag, because they have been dropping the ball because they got too cosy with the industry. Largely in the desire to speed up the process, which also refutes the argument that there is not counter regulation pressure.
Another example of pressure to reduce regulations are financial regulations. Their reduction arguably gave us (or contributed) to the GFC.
This is the classic pro-centralization bias.
Cancer and heart treatment are still in the stone age, with whole-body toxification in chemotherapy, and cutting open people's chest for open heart surgery, still being mainstay treatments.
Costs are also not declining, making cutting edge treatments unaffordable and inaccessible.
Compare to less regulated sectors, where quality has improved orders of magnitude while costs have massively declined, and it's clear that medicine/pharmaceuticals are underpeforming.
FCC or FAA?
I am not sure liability insurance is necessarily the complete answer. I think widening of criminal charges for breaching regulation should absolutely be pursued alongside liability for harms to humanity, there should be a basic duty of care to the the planet and its inhabitants and to the people that work for you that they are not harmed by your endeavours. We can't just continue allowing wage theft all the way up to mass destruction to the environment and treating it like its just a small fine that is necessary to resolve it. The system needs to expel those willing to take minor risk of getting caught for the large personal gain.
The 90s/early 00s cut back banking regulation and then we had the 08 crash. Trump rolled back some rail regulations and now we've got serious incidents happening there. Of course businesses hate the regulations they're generally preventing profitable but very risky behaviors with externalities beyond the business that's taking the risk.
Combine that with Supreme Court decisions that have limited courts abilities to punish companies when they do mess up by limiting things like punitive damages and the picture gets bleak for any option other than up front, very paperwork heavy regulation.
If we could trust businesses to actually follow rules and not take disastrous short cuts to make a buck maybe we could have a less heavy handed regulatory system but time and time again shows voluntary compliance or self regulation isn't a viable option.
Little to no evidence that the deregulation was the cause
> Trump rolled back some rail regulations and now we've got serious incidents happening there.
Derailments have increased recently but are still lower than they were in 2000.
More generally, the public and journalists only seem to have the intellectual capacity for first-order thinking, not second-order (not speaking of individuals, per se, just the emergent dynamics).
I would love to see an experiment that creates an agency that regulates other agencies, which has the following mandate: require all agencies to demonstrate that the all proposed regulations and regulatory enforcement has an outcome that is optimally beneficial for society. The agency would have the power to fire employees of other agencies and to disband and reconstitute entire agencies.
Don't get hung up on defining optimality, the metaregulators' real job is just to have the regulators think twice before letting their block-everything reflex kick in.
The insurer is motivated to incentivise effective risk-reduction behaviour - the government only has to define the penalties.
But then turn around and appeal to an equally dubious deity.
It's bureaucrats across a whole range of activities, or lack of activity thereof.
There was an article a while back on HN about the "Bureaucratic Failure Mode" that was worthwhile to look at.
Throughout history, every time you start to count on regulations, the whole thing falls apart pretty quickly. LOOK ELSEWHERE. We didn't have this much regulations 30 years ago and things were great.
The world moves forwards, three steps forward and two steps back. Human rights have progressed enormously since 1993 and that’s largely due to regulation. Deaths from smoking have been reduced. Deaths from car accidents have declined. Incredible, life changing drugs have been developed. And, of course, things have become worse in other ways. Wealth inequality being a very big one.
Things might have been great if you were healthy and wealthy in 1993, but I’d definitely not want to go back there.
Although you don't seem to understand the real reason you're living a "better" life: Someone (you or others) pays for it. Lives don't get better by regulation, they get better by hard work. The real reason smoking are less is because nice hard working people reach a consensus that smoking is bad. Not a genius that imposes regulation on smoking. Actually, if you don't offer alternatives for a nicotine addict (like a good life), regulation only makes them resentful and anti-social. So get your priorities straight.
Our labor pool is vast, but fixed. There is some fungibility among the individual workers... a welder can be re-trained as a teacher, or a miner can be re-trained to become a web developer. But it isn't perfectly fungible, the 45 yr taxi cab driver can't re-train to be an oncologist, and he certainly can't re-train to be a pharmaceutical engineer.
We might even say that they're not even mostly fungible... not for the professions we really want the most.
So how many "better regulators" do you need? Do you need two more, nationwide? We could probably find those. Do you need 24? A little more difficult, but as long as you are willing to wait 18 months or so, doable.
Do you need 300? 600? 800? Exactly how many at the FDA have to be superior regulators there? Worse still, even if the number is low...
What incentivizes someone who could be the superior regulator, but has chosen to be whatever-else-it-is-that-they-are? Do we need to offer more money? How much more? Million dollar salaries for one or two is feasible, but not for 800. Worse, even if we can afford it, offering that much money doesn't just attract them, it attracts many more inferior regulators.
Can you tell the difference? If three people show up for the $500,000/year regulator job, and two are schmoozing assholes, and the third is hyper-competent, what hiring system can you devise to reliably pass on the two and pick the other?
If the signal-to-noise ratio is too high there, it can likely overwhelm even a good hiring system.
And if it's bad for regulators, then this is simply a losing strategy for jobs like teachers, where we don't need a few dozen or a few dozen "better teachers", but hundreds of thousand of them. Police, etc.
The real problem is the advantage this gives to repeat players. Then innovators have to sell out to the majors before market validation, so there's been little significant change in the identity of the key players, even though there have been huge (finance-driven) changes in organizational and market structures (with wider profit margins).
It also amplifies first-mover advantage. Not only do first movers capture customers, they set the regulatory standards others have to beat. If they are a key technology (like Illumina's NGS short-read sequencing), it's a perfect set-up for the monopoly to tie sale of one product to another (e.g., the one-time hardware to ongoing reagents or software services). This is amplified by the privacy of the regulatory submissions.
How can it be changed? It can't. Big pharma is a trillion-dollar golden egg is a nest of the FDA's making, and no rational humanistic discourse or broad-based health-care financing issues are going to dislodge those investments.
The best we can hope for is to keep the profiteering reasonably discreet. By being somewhat unpredictable, the FDA gives each administration leverage to extract some concessions for each generation.
They’re so concerned with rule making and red tape they forget their actual mission
I'm pretty sure Louis Rossman has a massive playlist making fun of how hilariously slow NYC's approval process for construction work is. Adjacent to building codes is zoning laws, which exist specifically to make sure American housing is shaped like a speculative investment vehicle[0].
Driver's licenses err the other way: being licensed to drive is hideously easy, suspensions of that license for unsafe driving are far too uncommon, and people regularly flout the rules. Any serious attempt to enforce the law is opposed as draconian, so the law is only enforced on populations that cannot meaningfully fight back[1].
>What other alternative models to review-and-approval exist, and what do we know about them, either empirically or theoretically?
I'm not aware of any. In fact, while the author suggested liability as an alternative; I would argue that liability and review-and-approval are two sides of the same coin. You have some liability, which you don't realize right away because probabilistic outcomes allow lucky individuals and institutions to dodge bullets, and then once you realize your liability is higher than you thought you start engaging in review-and-approval. In the case of the FDA, the liability was the risk of public embarrassment and losing elections for allowing unsafe drugs to hit the market. In the case of factories, the review-and-approval processes are internal and unaccountable. While IRBs can start out well-meaning and degrade into exercises in speculative donkey blanketing[2], the factories will start as a CYA measure.
AI risk is particularly strange, because the biggest risk of AI is just that the technology works as intended. Not just that it works, or doesn't work, but that it works and one company owns it all. A cursory reading of selectorate theory would suggest the ultimate disenfranchisement of everyone but the specific subgroup of capitalists that happen to own parts of OpenAI, Microsoft, or Google. What you need is not risk mitigation, what you need is to force free publication and use of AI software. In other words, Stallman was right[3].
>Why is there so much bloat in the contract research organizations (CROs) that run clinical trials for pharma? Shouldn’t there be competition in that industry too?
Competition is an artifice of the 1970s. When we stopped blocking mergers on antitrust grounds we functionally abandoned the concept of private competition. This is why I don't think liability is a fix. The author thinks that there are still competitive pressures that would disincentivize over-regulation; that is not the case.
[0] Not it's original intent, of course: the original idea was to keep black people out of the suburbs. Like much else in the US, the structure is not perpetuated for the sake of racism, but it is an artifice of vestigial racism.
[1] This is mediated through poverty; rich towns have politically active citizens that will fight back against new ways of enforcing the law. Poor towns can fleece their people at traffic stops, and they don't have to pay their cops as much as long as they can be paid in police brutality. Thanks to vestigial racism induced poverty, this disproportionately affects black people, too.
The dynamics behind this are Cory Doctorow's "shitty technology adoption curve."
[2] Covering your ass.
[3] Also Ned Ludd was right.
Zoning laws limiting new buildings and artificially increasing cost of housing are pretty universal feature in developed world, even in racially homogeneous countries.