Wednesday, April 3, 2019

Organizations and dysfunction


A recurring theme in recent months in Understanding Society is organizational dysfunction and the organizational causes of technology failure. Helmut Anheier's volume When Things Go Wrong: Organizational Failures and Breakdowns is highly relevant to this topic, and it makes for very interesting reading. The volume includes contributions by a number of leading scholars in the sociology of organizations.

And yet the volume seems to miss the mark in some important ways. For one thing, it is unduly focused on the question of "mortality" of firms and other organizations. Bankruptcy and organizational death are frequent synonyms for "failure" here. This frame is evident in the summary the introduction offers of existing approaches in the field: organizational aspects, political aspects, cognitive aspects, and structural aspects. All bring us back to the causes of extinction and bankruptcy in a business organization. Further, the approach highlights the importance of internal conflict within an organization as a source of eventual failure. But it gives no insight into the internal structure and workings of the organization itself, the ways in which behavior and internal structure function to systematically produce certain kinds of outcomes that we can identify as dysfunctional.

Significantly, however, dysfunction does not routinely lead to death of a firm. (Seibel's contribution in the volume raises this possibility, which Seibel refers to as "successful failures"). This is a familiar observation from political science: what looks dysfunctional from the outside may be perfectly well tuned to a different set of interests (for example, in Robert Bates's account of pricing boards in Africa in Markets and States in Tropical Africa: The Political Basis of Agricultural Policies). In their introduction to this volume Anheier and Moulton refer to this possibility as a direction for future research: "successful for whom, a failure for whom?" (14).

The volume tends to look at success and failure in terms of profitability and the satisfaction of stakeholders. But we can define dysfunction in a more granular way by linking characteristics of performance to the perceived "purposes and goals" of the organization. A regulatory agency exists in order to effectively project the health and safety of the public. In this kind of case, failure is any outcome in which the agency flagrantly and avoidably fails to prevent a serious harm -- release of radioactive material, contamination of food, a building fire resulting from defects that should have been detected by inspection. If it fails to do so as well as it might then it is dysfunctional.

Why do dysfunctions persist in organizations? It is possible to identify several possible causes. The first is that a dysfunction from one point of view may well be a desirable feature from another point of view. The lack of an authoritative safety officer in a chemical plant may be thought to be dysfunctional if we are thinking about the safety of workers and the public as a primary goal of the plant (link). But if profitability and cost-savings are the primary goals from the point of view of the stakeholders, then the cost-benefit analysis may favor the lack of the safety officer.

Second, there may be internal failures within an organization that are beyond the reach of any executive or manager who might want to correct them. The complexity and loose-coupling of large organizations militate against house cleaning on a large scale.

Third, there may be powerful factions within an organization for whom the "dysfunctional" feature is an important component of their own set of purposes and goals. Fligstein and McAdam argue for this kind of disaggregation with their theory of strategic action fields (link). By disaggregating purposes and goals to the various actors who figure in the life cycle of the organization – founders, stakeholders, executives, managers, experts, frontline workers, labor organizers – it is possible to see the organization as a whole as simply the aggregation of the multiple actions and purposes of the actors within and adjacent to the organization. This aggregation does not imply that the organization is carefully adjusted to serve the public good or to maximize efficiency or to protect the health and safety of the public. Rather, it suggests that the resultant organizational structure serves the interests of the various actors to the fullest extent each actor is able to manage.

Consider the account offered by Thomas Misa of the decline of the steel industry in the United States in the first part of the twentieth century in A Nation of Steel: The Making of Modern America, 1865-1925. Misa's account seems to point to a massive dysfunction in the steel corporations of the inter-war period, a deliberate and sustained failure to invest in research on new steel technologies in metallurgy and production. Misa argues that the great steel corporations -- US Steel in particular -- failed to remain competitive in their industry in the early years of the twentieth century because management persistently pursued short-term profits and financial advantage for the company through domination of the market at the expense of research and development. It relied on market domination instead of research and development for its source of revenue and profits.
In short, U.S. Steel was big but not illegal. Its price leadership resulted from its complete dominance in the core markets for steel.... Indeed, many steelmakers had grown comfortable with U.S. Steel's overriding policy of price and technical stability, which permitted them to create or develop markets where the combine chose not to compete, and they testified to the court in favor of the combine. The real price of stability ... was the stifling of technological innovation. (255)
The result was that the modernized steel industries in Europe leap-frogged the previous US advantage and eventually led to unviable production technology in the United States.
At the periphery of the newest and most promising alloy steels, dismissive of continuous-sheet rolling, actively hostile to new structural shapes, a price leader but not a technical leader: this was U.S. Steel. What was the company doing with technological innovation? (257)
 Misa is interested in arriving at a better way of understanding the imperatives leading to technical change -- better than neoclassical economics and labor history. His solution highlights the changing relationships that developed between industrial consumers and producers in the steel industry.
We now possess a series of powerful insights into the dynamics of technology and social change. Together, these insights offer the realistic promise of being better able, if we choose, to modulate the complex process of technical change. We can now locate the range of sites for technical decision making, including private companies, trade organizations, engineering societies, and government agencies. We can suggest a typology of user-producer interactions, including centralized, multicentered, decentralized, and direct-consumer interactions, that will enable certain kinds of actions while constraining others. We can even suggest a range of activities that are likely to effect technical change, including standards setting, building and zoning codes, and government procurement. Furthermore, we can also suggest a range of strategies by which citizens supposedly on the "outside" may be able to influence decisions supposedly made on the "inside" about technical change, including credibility pressure, forced technology choice, and regulatory issues. (277-278)
In fact Misa places the dynamic of relationship between producer and large consumer at the center of the imperatives towards technological innovation:
In retrospect, what was wrong with U.S. Steel was not its size or even its market power but its policy of isolating itself from the new demands from users that might have spurred technical change. The resulting technological torpidity that doomed the industry was not primarily a matter of industrial concentration, outrageous behavior on the part of white- and blue-collar employees, or even dysfunctional relations among management, labor, and government. What went wrong was the industry's relations with its consumers. (278)
This relative "callous treatment of consumers" was profoundly harmful when international competition gave large industrial users of steel a choice. When US Steel had market dominance, large industrial users had little choice; but this situation changed after WWII. "This favorable balance of trade eroded during the 1950s as German and Japanese steelmakers rebuilt their bombed-out plants with a new production technology, the basic oxygen furnace (BOF), which American steelmakers had dismissed as unproven and unworkable" (279). Misa quotes a president of a small steel producer: "The Big Steel companies tend to resist new technologies as long as they can ... They only accept a new technology when they need it to survive" (280).

***

Here is an interesting table from Misa's book that sheds light on some of the economic and political history in the United States since the post-war period, leading right up to the populist politics of 2016 in the Midwest. This chart provides mute testimony to the decline of the rustbelt industrial cities. Michigan, Illinois, Ohio, Pennsylvania, and western New York account for 83% of the steel production on this table. When American producers lost the competitive battle for steel production in the 1980s, the Rustbelt suffered disproportionately, anad eventually blue collar workers lost their places in the affluent economy.

Monday, April 1, 2019

Ethical disasters


Many examples of technical disasters have been provided in Understanding Society, along with efforts to understand the systemic dysfunctions that contributed to their occurrence. Frequently those dysfunctions fall within the business organizations that manage large, complex technology systems, and often enough those dysfunctions derive from the imperatives of profit-maximization and cost avoidance. Andrew Hopkins' account of the business decisions contributing to the explosion of the ESSO gas plant in Longford, Australia illustrates this dynamic in Lessons from Longford: The ESSO Gas Plant Explosion. The withdrawal of engineering experts from the plant to a remote corporate headquarters was a cost-saving move that, according to Hopkins, contributed to the eventual disaster.

A topic we have not addressed in detail is the occurrence of ethical disasters -- terrible outcomes that are the result of deliberate choices by decision-makers within an organization that are, upon inspection, clearly and profoundly unethical and immoral. The collapse of Enron is probably one such disaster; the Bernie Madoff scandal is another. But it seems increasingly likely that Purdue Pharma and the Sackler family's business leadership of the corporation represent another major example. Recent reporting by ProPublica, the Atlantic, and the New York Times relies on documents collected in the course of litigation against Purdue Pharma and members of the Sackler family in Massachusetts and New York. (Here are the unredacted court documents on which much of this reporting depends; link.) These documents make it hard to avoid the ethical conclusion that the Sackler family actively participated in business strategies for their company Purdue Pharma that treated the OxyContin addiction epidemic as an expanding business opportunity. And this seems to be a huge ethical breach.

This set of issues is currently unresolved by the courts, so it rests with the legal system to resolve the facts and the issues of legal culpability. But as citizens we all have the ability to read the documents and make our own decisions about the ethical status of decisions and strategies made by the family and the corporation over the course of this disaster. The point here is simply to ask these key questions: how should we think about the ethical status of decisions and strategies of owners and managers that lead to terrible harms, and harms that could reasonably have been anticipated? How should a company or a set of owners respond to a catastrophe in which several hundred thousand people have died, and which was facilitated in part by deliberate marketing efforts by the company and the owners? How should the company have adjusted its business when it became apparent that its product was creating addiction and widespread death?

First, here are a few details from the current reporting about the case. Here are a few paragraphs from the ProPublica story (January 30, 2019):
Not content with billions of dollars in profits from the potent painkiller OxyContin, its maker explored expanding into an “attractive market” fueled by the drug’s popularity — treatment of opioid addiction, according to previously secret passages in a court document filed by the state of Massachusetts. 
In internal correspondence beginning in 2014, Purdue Pharma executives discussed how the sale of opioids and the treatment of opioid addiction are “naturally linked” and that the company should expand across “the pain and addiction spectrum,” according to redacted sections of the lawsuit by the Massachusetts attorney general. A member of the billionaire Sackler family, which founded and controls the privately held company, joined in those discussions and urged staff in an email to give “immediate attention” to this business opportunity, the complaint alleges. (ProPublica 1/30/2019; link)
The NYT story reproduces a diagram included in the New York court filings that illustrates the company's business strategy of "Project Tango" -- the idea that the company could make money both from sales of its pain medication and from sales of treatments for the addiction it caused.


Further, according to the reporting provided by the NYT and ProPublica, members of the Sackler family used their positions on the Purdue Pharma board to press for more aggressive business exploitation of the opportunities described here:
In 2009, two years after the federal guilty plea, Mortimer D.A. Sackler, a board member, demanded to know why the company wasn't selling more opioids, email traffic cited by Massachusetts prosecutors showed. In 2011, as states looked for ways to curb opioid prescriptions, family members peppered the sales staff with questions about how to expand the market for the drugs.... The family's statement said they were just acting as responsible board members, raising questions about "business issues that were highly relevant to doctors and patients. (NYT 4/1/2019; link)
From the 1/30/2019 ProPublica story, and based on more court documents:
Citing extensive emails and internal company documents, the redacted sections allege that Purdue and the Sackler family went to extreme lengths to boost OxyContin sales and burnish the drug’s reputation in the face of increased regulation and growing public awareness of its addictive nature. Concerns about doctors improperly prescribing the drug, and patients becoming addicted, were swept aside in an aggressive effort to drive OxyContin sales ever higher, the complaint alleges. (link)
And ProPublica underlines the fact that prosecutors believe that family members have personal responsibility for the management of the corporation:
The redacted paragraphs leave little doubt about the dominant role of the Sackler family in Purdue’s management. The five Purdue directors who are not Sacklers always voted with the family, according to the complaint. The family-controlled board approves everything from the number of sales staff to be hired to details of their bonus incentives, which have been tied to sales volume, the complaint says. In May 2017, when longtime employee Craig Landau was seeking to become Purdue’s chief executive, he wrote that the board acted as “de-facto CEO.” He was named CEO a few weeks later. (link)
The courts will resolve the question of legal culpability. The question here is one of the ethical standards that should govern the actions and strategies of owners and managers. Here are several simple ethical observations that seem relevant to this case.

First, it is obvious that pain medication is a good thing when used appropriately under the supervision of expert and well-informed physicians. Pain management enhances quality of life for people experiencing pain.

Second, addiction is plainly a bad thing, and it is worse when it leads to predictable death or disability for its victims. A company has a duty of concern for the quality of life of human beings affected by its product, and this extends to a duty to take all possible precautions to minimize the likelihood that human beings will be harmed by the product.

Third, given that the risks of addiction that were known about this product, the company has a moral obligation to treat its relations with physicians and other health providers as occasions of accurate and truthful education about the product, not opportunities for persuasion, inducement, and marketing. Rather than a sales force of representatives whose incomes are determined by the quantity of the product they sell, the company has a moral obligation to train and incentivize its representatives to function as honest educators providing full information about the risks as well as the benefits of the product. And, of course, it has an obligation not to immerse itself in the dynamics of "conflict of interest" discussed elsewhere (link) -- this means there should be no incentives provided to the physicians who agree to prescribe the product.

Fourth, it might be argued that the profits generated by the business of a given pharmaceutical product should be used proportionally to ameliorate the unavoidable harms it creates. Rather than making billions in profits from the sale of the product, and then additional hundreds of millions on products that offset the addictions and illness created by dissemination of the product (this was the plan advanced as "Project Tango"), the company and its owners should hold themselves accountable for the harms created by their product. (That is, the social and human costs of addiction should not be treated as "externalities" or even additional sources of profit for the company.)

Finally, there is an important question at a more individual scale. How should we think about super-rich owners of a company who seem to lose sight entirely of the human tragedies created by their company's product and simply demand more profits, more timely distribution of the profits, and more control of the management decisions of the company? These are individual human beings, and surely they have a responsibility to think rigorously about their own moral responsibilities. The documents released in these court proceedings seem to display an amazing blindness to moral responsibility on the part of some of these owners.

(There are other important cases illustrating the clash between moral responsibility, corporate profits, and corporate decision-making, having to do with the likelihood of collaboration between American companies, their German and Polish subsidiaries, and the Nazi regime during World War II. Edwin Black argues in IBM and the Holocaust: The Strategic Alliance Between Nazi Germany and America's Most Powerful Corporation-Expanded Edition that the US-based computer company provided important support for Germany's extermination strategy. Here is a 2002 piece from the Guardian on the update of Black's book providing more documentary evidence for this claim; link. And here is a piece from the Washington Post on American car companies in Nazi Germany; link. )

(Stephen Arbogast's Resisting Corporate Corruption: Cases in Practical Ethics From Enron Through The Financial Crisis is an interesting source on corporate ethics.)

Development ethnography and the life of the poor


Indian economists V. K. Ramachandran and Madhura Swaminathan have edited a highly interesting volume, Telling the Truth, Taking Sides: Essays for N. Ram, that will be of interest to anyone concerned with the progress of India in recent years. The book is a set of essays dedicated to the impact and progressive legacy of N Ram, journalist, writer, and important voice of the Left in India, and all the essays are very good.

Ramachandran's own contribution is a piece of what we might call "development ethnography", a pair of interviews (link) with the Tamil Nadu landless worker Gabriel Selvam. This case study is a valuable document for anyone interested in poverty and global justice. Ramachandran conducted interviews with Selvam at both ends of Selvam's working life, in 1977 and 2017, and the experiences that Selvam describes are emblematic of the extreme poor in India and elsewhere throughout that forty-year period. Selvam has lived most of his life in rural Tamil Nadu, near the town of Gokilapuram. And Selvam's life history illustrates many of the deep themes of enduring poverty and inequality in rural India -- debt, bonded labor, inadequate access to land, caste, and extremely limited opportunities for collective action.

Usury involving a sum of only 100 rupees forced Selvam into a form of debt bondage to a landlord: "Selvam attached himself as a farm servant for a remuneration of Rs 65 per month, plus one sheet, a dhoti, a shirt and a thunda (towel-cloth) a year." He worked 13 hours a day for the salary of Rs 65 per month. After four years the salary increased to Rs 100 per month. (At the 2000 exchange rate of Rs 45 / dollar this is about $2.22 / month.)

Debt bondage has been formally illegal in India since 1976. But Selvam's condition is clearly one of debt bondage: "There is no choice, I can't leave my mudalali [employer, landlord] unless I can clear my debt of Rs 300. I would certainly like to leave."

Largescale eviction from farm land is also a part of Selvam's story. Green Revolution seeds and techniques made farm land more profitable, and landlords had an interest in evicting poor farmers from the land they had previously rented at low rents. Poor farmers became landless workers.

The persistent and debilitating disadvantages of caste in rural India are evident in this story as well. Selvam is of a scheduled caste, and it seems apparent that the wage differentials that he experienced throughout his working life had much to do with his dalit status.

Destitution-level housing is also a striking part of the story that Selvam tells. In 1977: "As for his home, Selvam cannot afford to erect a complete hut. When he gets a small amount of money, he adds a row of bricks to the hut. Some months ago, he bought a door-frame. Now, there is a door-frame, fixed with mud into a few rows of country-made brick, with no wall around it or roof above. The single room in the hut is 8 feet by 6 feet." In 2017, the time of the second interview, the hut has been completed: "it is completed and expanded now: a neat, whitewashed structure that has the meagre furniture and appurtenances of a house that is still, after all, the house of a full-time rural manual worker."

In 2017 Selvam's wage has also improved; he now earns Rs 4000 per month for hard agricultural labor -- in today's exchange rate, about $40 / month. As Selvam says, they are better off. And yet it is clear -- "better off" in Selvam's village still means poor access to education and healthcare, limited nutrition, an extremely low income, and a life of toil that few Americans can even imagine.

I hope that you will read the whole interview. It is a more powerful testament to the depth of poverty and inequality in rural India than any set of economic statistics could ever convey.

Here is a World Bank report that makes for excellent parallel reading alongside Ramachandran's case history (Raji Jayaraman and Peter Lanjouw, "The Evolution of Poverty and Inequality in Indian Villages"; link).

Thursday, March 28, 2019

Guest post: VK Ramachandran on details of life as a day laborer in India


[V. K. Ramachandran was a Professor of Economics at the Indian Statistical Institute, and is at present vice chairman of the State Planning Board of the state of Kerala. He is the author of Wage Labour and Unfreedom in Agriculture: An Indian Case Study. Previous discussions of Ramachandran's work in Understanding Society can be found here (link, link, link, link), and here is an interview I conducted with VK in 2008; link.]

[Acknowledgement: Extracted from Ramachandran, V. K., and Madhura Swaminathan, (eds.) (2018), Telling the Truth, Taking Sides: Essays for N. Ram, Tulika Books, New Delhi. This is a set of essays dedicated to the impact and progressive legacy of N Ram, journalist, writer, and important voice of the Left in India.]

"Gabriel Selvam: A Biography of Work"

V. K. Ramachandran

Among the many the many things in which N. Ram was an early instructor (and I not good enough a learner) was on how to interview, take notes, edit copy, and present the results from conversation and observation.

NR was the first among us to meet Gabriel Selvam, and the description “upstanding young agricultural labourer” is his.

An Interview in Two Parts, 1977 and 2017

1977: Young Bonded Worker

G. Selvam (35) is an upstanding young agricultural labourer who has bonded himself as a pannaiyal (permanent farm servant) out of economic necessity. Selvam’s family is of the Parayar scheduled caste.

A loan of Rs 100 taken over six years ago from CT, a petty usurer, led directly to his present condition as farm servant. At that time, the loan was taken for subsistence needs and was perceived as a temporary expedient. On account of a 120 percent interest rate, the loan of Rs 100 became a liability of Rs 220 over a year. The usurer pressed Selvam, then 31 years old, to sell his house in order to repay the loan. Selvam, refusing to abandon the family house site, went around asking for a way to work off his debt. The opportunity presented itself in the form of the landlord SCC. This landlord, who was looking for a young and strong farm servant, was willing to advance the money to clear the debt, provided Selvam attached himself as a farm servant for a remuneration of Rs 65 per month plus one sheet and a dhoti, a shirt, and a towel-cloth (thundu) a year.

Selvam took an advance of Rs 100 for going to work as a farm servant, and used that to clear just under half his debt. Then, after the first month of work, he took a loan of Rs 120 to clear the debt.

Since then, that is, for six years, Selvam has been working for well over 13 hours a day. He worked at the salary of Rs 65 a month for four years. Two years ago, when paddy prices soared to nearly Rs 150 per 58-kilogram bag, the farm servants in the village asked their employers for a raise. Selvam was given a wage rise that was long overdue: in 1977 he was paid Rs 110 a month.

SCC, like some other big landlords in the village, has found it much to his advantage to hire a farm servant in this way. He has advanced small sums of money to Selvam over the years, sums always taken “temporarily,” but with no real chance of the debtor repaying the debt and getting out of his present condition. Selvam makes it clear that he is not paid anything near the remuneration he should be getting for this work. “There is no choice,” he says, “I can’t leave my mudalali (employer, landlord) unless I can clear my debt of Rs 300. I would certainly like to leave.”

In his childhood, Selvam was not as badly off as he is today. His father, Gabriel, was a poor or lower-middle peasant, cultivating surface-irrigated land that had been leased in from landlords of the village. His mother worked as a hired labourer.

His father sent Selvam to school. Selvam studied in the Mission School in Gokilapuram, down the road from where he lives today, up to the fifth class. He completed the sixth class at the NMR School in Gokilapuram. Selvam was a good student and his father sent him to Vatthalakundu, where Selvam studied in the seventh and eighth classes, finishing when he was 16 years old. He stayed at a hostel at Vatthalakundu, and his father sent him Rs 20 a month. Selvam returned to the village after finishing the eighth class. He can read and write Tamil and can still read some English.

Selvam’s father tilled 6 kuzhi (3.6 acres) of surface-irrigated land belonging to landlord ST on kuthagai (fixed rent) for 20 years. He also worked 1.5 acres of groundwater-irrigated land belonging to SP, a landlord of Uthamapalayam. Selvam also worked on the land leased in by the family. Selvam married when he was 20 years old. His wife, Alphonse, is from a family of tenant cultivators from Pudupatti in Uthamapalayam taluk.

In about 1967, there was a sharp decline in the agriculture conducted by the family. The surface-irrigated land had poor soil and bad drainage, and standing water after the rain affected the crop. The land was manured only for one crop, one of the reasons for the yield being poor. The groundwater-irrigated land had a well with plenty of water and had a pulley and rope to draw water with. But household cultivation was in decline, the family began to incur debt, and the age-old symbol of a peasant family heading towards destitution became apparent: the cattle owned by the family became thin and weak.

About the same time, eviction took place on a large scale in the village. Earlier, the paddy crops were the traditional parunnel and samba varieties; later, with the introduction of new seeds, yields were higher, and agriculture became more profitable for the landlords. There was also fear among them, Selvam said, that the tenants would assert their right to cultivate the land. Landlords brought pressure on the tenants to leave the land. Rents were raised, rack-rents were imposed on tenants. In some cases, landlords brought great pressure on tenants to leave, offering them small amounts of money to do so. The peasants were disunited, Selvam said, and, out of fear, accepted the money and left the land.

Agricultural Wage Work

Selvam made it clear that the big landlords can always bring pressure on agricultural labourers; as for agricultural labourers, there is little scope for their advance today. Opportunities for employment in some tasks have gone down since the arrival of tractors, Selvam pointed out. The tractor has robbed those with ploughs and bullocks of ploughing work, and those with carts and bullocks of work in basal manuring. Even during threshing, the tractor has deprived agricultural labourers of employment. While earlier, there would be four days’ work at the threshing-floor and four bullocks would be needed to trample the grain for the second threshing, now the tractor can be driven over the sheaves to complete the task in less than an hour.

Unemployment is high and wages are poor, and women’s wages have actually been brought down, from Rs 3 per day to Rs 2.50 per day. There was agitation by Communists five years ago in southern villages of the Valley, Selvam recalls, when men workers won an increase in their grain wages, from 4 measures per day to 5 measures, and women an increase to 3 measures for threshing.

While wages in the village do not vary directly with the caste of the worker, discrimination against the scheduled castes, the overwhelming majority of whom are landless labourers, is deeply entrenched. Most of the farm servants in the village are Dalit.

Selvam has an extremely busy working year. During the 1976-7 agricultural year, he worked on both crops of paddy on surface-irrigated land, in different operations in the cultivation of irrigated sorghum (cholam), finger millet (ragi), tomato, and banana on groundwater-irrigated land, and in little millet (samai) on unirrigated land. In addition to agricultural work every day, he did domestic tasks at the landlord’s house. Selvam’s wife Alphonse laboured at agricultural operations for 57 days in 1976-7, and earned Rs 158.70 as wages. She seeded and cleaned tamarind for 3 days, for which she earned Rs 7.50.

Selvam’s wage is lower than other farm servants in the village, some of whom are paid Rs 130 and Rs 140 by their landlord employers. But when Selvam asks for a wage increase, the landlord arrogantly insists: “I have already increased your wages. You used to get Rs 65, now you get 110.” The standard that SCC uses, Selvam says, is not the wage paid to other farm servants in the village, but the Rs 65 pittance that Selvam himself used to receive before he was paid Rs 110 a month.

When Selvam is unwell, the landlord may give Selvam a small amount of money to buy medicine, but he will not pay for treatment for Alphonse or the children when they fall ill.

As for his home, Selvam cannot afford to erect a complete hut. When he gets a small amount of money, he adds a row of bricks to the hut. Some months ago, he bought a door-frame. Now there is a door-frame, fixed with mud into a few rows of country-made brick, with no wall around it or roof above. The single room in the hut is 8 feet by 6 feet. “We do not know when this hut will be built,” Alphonse said. “We lay a few bricks, and it may be a few months before we can add more bricks. It may take years to complete the hut in this manner.”

With all this, Selvam must also face rudeness and shouts from the landlord, the loud arrogance of SCC as taskmaster of “his” farm servant.

“Life is difficult for me,” Selvam said. He sees his children at 5 a.m. (when he leaves the house), when the older children may be just beginning to wake up. It is seldom, and only in the slack season, that he comes home before they are asleep for the night. And the hours in between are filled with arduous, back-breaking labour that covers every task that an agricultural labourer in the village can perform.

I have seen Selvam, early in the morning, heaving farmyard manure on to a cart and driving the cart to the paddy-fields, unloading it in neat piles across the field. I have seen him, bare-chested, barefoot, and dressed in an old and torn lungi, with a soiled cloth on his head to protect him from the sun, walking with a hoe across his shoulder over the ridge east of the village on the road leading to SCC’s groundwater-irrigated field in neighbouring Anamalaiyanpatti. I have seen him at the field, cutting and clearing water channels before the electricity comes on and irrigation water rushes up; and in the banana field, hacking at the tough young shoots that grow by the banana trees, cutting dry and withered leaves off the tree, and straightening tree trunks with wooden props that have been chopped and shaped by him. I have seen him, in the evenings, working in SCC’s house, watering, feeding, and washing the cattle or chopping a tree trunk for firewood for SCC’s kitchen. I have seen him at the bus-stop in Uthamapalayam, straining to lift a motor pump, newly repaired, on to the carrier of a Gokilapuram-bound bus. Standing under a bus-shelter in Gokilapuram after 11 o’clock at night, I have heard the sound of a cart coming down the road from Anamalaiyanpatti. It is Selvam, urging the bullocks through pouring rain back to the house of SCC. I have seen him after 11.30 at night, rain smudging the red mud that clings to his face and body, entering his hut and eating gruel and pickle by the weak light of an oil lamp, and preparing to catch some sleep before the next day of labour begins.

Selvam states clearly that it is not “loyalty” that keeps him with the landlord. It is his debt and the difficulty of finding alternative employment if he were to leave. “I have heard of the union of agricultural labourers in East Thanjavur. A union is needed, unity of agricultural labourers is needed. If there were a union in Gokilapuram, I would join it.”

May 1977

2017: A Working Life

Selvam worked for a total of 13 years with SCC. When he left, he was paid a mere Rs 400 a month. Selvam said that about 4000 rupees were due to him and unpaid when he left SCC’s employment.

Selvam worked 15 years as a daily worker after he left the employment of SCC. Three years after he left, Selvam’s son Arokiyasami was married. Over the three years, Selvam spent one year as a worker in a cardamom estate in Parathodu in Kerala, owned by Shanmughavel of Pannaipuram.

Alphonse worked as a wage labourer all her working life, that is, until four years ago.

Ten years ago, Selvam began to work for Venkatesan, a retired college teacher. Selvam was hired at a wage of Rs 2000 a month. Venkatesan owns 10.8 acres of thottam land and 1.8 acres of nanjai land in the north of the village, on the banks of the Thamaraikulam irrigation tank, where he grows nendran banana and coconut.

Selvam comes to the field at 7 am every day, takes a break from about 11:00 to 2:30, and works again at the field till 6 pm. He takes care of the field, clears the channels for irrigation, works the locks of the pipes for drip irrigation, supervises and works with other wage workers at some operations (planting and harvest), and weeds and cleans the fields. He also keeps the main trunks of the banana trees free of unwanted side-shoots, and applies fertilizer and undertakes all other plant protection tasks.

After three years with the landlord, Selvam asked for a raise. His new wage was fixed at Rs 4,000 a month (the worker on the neighbouring field gets Rs 6,000 a month, he told us). The landlord agreed, and said that he would henceforth account for Selvam’s withdrawals against the new wage. For Selvam is not paid his wage on a fixed day every month. He takes money for expenses from the owner “whenever I need it,” for household expenses, for festivals. The employer says he is keeping an account; Selvam trusts him and says that he, too, keeps track of how much he has taken from the landlord. He estimates that he has credit of about Rs 10,000 with the landlord. There is no formal account of Selvam’s savings with the landlord.

Four years ago, Alphonse developed a swelling on her right knee. A doctor in Uthamapalayam gave her drugs and an injection, and the swelling “sank to her foot.” Blood and pus was drained with a large syringe from the foot. Alphonse was discharged from the hospital, and was told to spread an ointment on the wound. Selvam did this every day. Alphonse began to scratch the itchy wound before it had healed completely. She eats betel leaf and nuts with lime, and the lime paste on her finger began to inflame the wound. It turned septic. Selvam took her in his son Sekhar’s autorickshaw to Cumbum, where the doctor said that she needed emergency treatment at Theni. Alphonse was taken by ambulance to the Theni Government Medical College and Hospital, where the doctors advised emergency surgery. She had a second surgery, followed by a skin graft.

In the post-operative ward, Selvam watched people on the other beds, and began to realise the importance of dressing Alphonse’s wound correctly – that it was a task that needed an expert, something he could not do himself. He hired a person to change the bandage – at Rs 50 a day – for the three months they spent in the hospital.

Alphonse is back home now. She can move a bit – to the sitting platform in front of the house, to change her clothes, to go to the bathroom; but not more than that. “We do not know how long she will survive. She has never done anyone any wrong. When she goes, it will be to heaven.”

The Children

Arokiasamy (50), the oldest child of Selvam and Alphonse, works as a mason and has a small business as a contractor for constructing small houses. His wife, Sumathi, has a tenth class school-leaving certificate, and works in the panchayat office as a data collector. They have two children, a son, Maniprathi (22), now a student at a polytechnic in Namakkal, and a daughter, Sunitha (21). Sunitha completed a B. A. degree and is now married. Her husband works on the staff of a tea estate owned by N Ramakrishnan, former MLA from Cumbum.

Arokiamary (48), the only daughter of Selvam and Alphonse, is now almost completely blind. She looks after her parents and brother, the much-loved carer in the home.

Shekhar (46) lives in Gokilapuram. He owns an autorickshaw, from which he which earns an income of Rs 500 to Rs 1000 a day. His wife, Thilakam, is a manual worker in agriculture and at non-agricultural tasks. Their children, Merlyn Marcia and Praveen, their grandparents’ joy, study in class 1 and class 2 in the English-language medium section of the Savarimuthu Udayar Memorial Higher Secondary School, a reputed school in the neighbouring village of Rayappanpatti.

Vedamuthu (44) stays at home with his parents. He is a person with intellectual disabilities, and is unable to go regularly to work.

Xavier (41), the youngest son of the family, works at loading and unloading bags of rice at the government civil supplies godown in Uthamapalayam. His wife Muthuarokiyam and he are now residents of Uthamapalayam, where his children Akhilesh, Vimalesh, and Pratibha go to school. Xavier earns 600 rupees a day, and an extra 1000 rupees a month for the manual work at the godown.

Forty Years On

Selvam and family live today in the house whose initial construction costs led him into bondage in 1977. It is completed and expanded now, a neat whitewashed structure that has the meagre furniture and appurtenances of a house that is still, after all, the house of a full-time rural manual worker. They were exploited and extremely poor – near destitute – in 1977. Today, they are still poor, Selvam’s wages are low, and he has no knowledge of how much of his earned wages are held by his employer. But he is no longer destitute, no longer in bondage, and no longer at the mercy of a harsh and cruel landlord of the old type.

They are better off now than they were in 1977 – oh yes, of course we are, Selvam says. Our house is complete, and we never go hungry, we have special things to eat: egg curry twice a week, chicken on Sundays, fish once in about twenty days. Thanks to the public system for the distribution of cereal, there is enough rice for the family. The house has been electrified (Selvam says that they received their electricity connection at the same time, conveniently, as their son Arokiasami’s wedding).

I have continued to meet Selvam over the years. I was associated with resurveys of Gokilapuram village in 1986 and 1999, and continue to be interested in changing agrarian relations in the village and region. I return to the Cumbum Valley regularly for tasks connected with the Gokilapuram Educational Trust, an organisation of which the honoree of this volume is a founder trustee. Travel to the Valley gives me an opportunity to keep in touch with Selvam; as we grow older, we grow more conscious of the value of old friendships.

Selvam asks me if I remember the little kerosene lamp (of course I do -- made of tin and with a flimsy glass chimney) that I used during our survey in 1977. I used it after dark during conversations and interviews in homes that had no electricity. You gave it to me when you left the village after the survey, he says. After electricity came to the house Selvam stored the lamp deep in a loft, where it remains today. He keeps it as a reminder of his friend -- and of the days when they had only a single lamp for light in a half-constructed house.

December 2017

Social ontology of government



I am currently writing a book on the topic of the "social ontology of government". My goal is to provide a short treatment of the social mechanisms and entities that constitute the workings of government. The book will ask some important basic questions: what kind of thing is "government"? (I suggest it is an agglomeration of organizations, social networks, and rules and practices, with no overriding unity.) What does government do? (I simplify and suggest that governments create the conditions of social order and formulate policies and rules aimed at bringing about various social priorities that have been selected through the governmental process.) How does government work -- what do we know about the social and institutional processes that constitute its metabolism? (How do government entities make decisions, gather needed information, and enforce the policies they construct?)

In my treatment of the topic of the workings of government I treat the idea of "dysfunction" with the same seriousness as I do topics concerning the effective and functional aspects of governmental action. Examples of dysfunctions include principal-agent problems, conflict of interest, loose coupling of agencies, corruption, bribery, and the corrosive influence of powerful outsiders. It is interesting to me that this topic -- ontology of government -- has unexpectedly crossed over with another of my interests, the organizational causes of largescale accidents.

If there are guiding perspectives in my treatment, they are eclectic: Neil Fligstein and Doug McAdam, Manuel DeLanda, Nicos Poulantzas, Charles Perrow, Nancy Leveson, and Lyndon B. Johnson, for example.

In light of these interests, I find the front page of the New York Times on March 28, 2019 to be a truly fascinating amalgam of the social ontology of government, with a heavy dose of dysfunction. Every story on the front page highlights one feature or another of the workings and failures of government. Let's briefly name these features. (The item numbers flow roughly from upper right to lower left.)

Item 1 is the latest installment of the Boeing 737 MAX story. Failures of regulation and a growing regime of "collaborative regulation" in which the FAA delegates much of the work of certification of aircraft safety to the manufacturer appear at this early stage to be a part of the explanation of this systems failure. This was the topic of a recent post (link).

Items 2 and 3 feature the processes and consequences of failed government -- the social crisis in Venezuela created in part by the breakdown of legitimate government, and the fundamental and continuing inability of the British government and its prime minister to arrive at a rational and acceptable policy on an issue of the greatest importance for the country. Given that decision-making and effective administration of law are fundamental functions of government, these two examples are key contributions to the ontology of government. The Brexit story also highlights the dysfunctions that flow from the shameful self-dealing of politicians and leaders who privilege their own political interests over the public good. Boris Johnson, this one's for you!

Item 4 turns us to the  dynamics of presidential political competition. This item falls on the favorable side of the ledger, illustrating the important role that a strong independent press has in helping to inform the public about the past performance and behavior of candidates for high office. It is an important example of depth journalism and provides the public with accurate, nuanced information about an appealing candidate with a policy history as mayor that many may find unpalatable. The story also highlights the role that non-governmental organizations have in politics and government action, in this instance the ACLU.

Item 5 brings us inside the White House and gives the reader a look at the dynamics and mechanisms through which a small circle of presidential advisors are able to determine a particular approach to a policy issue that they favor. It displays the vulnerability the office of president shows to the privileged insiders' advice concerning policies they personally favor. Whether it is Mick Mulvaney, acting chief of staff to the current president, or Robert McNamara's advice to JFK and LBJ leading to escalation in Vietnam, the process permits ideologically committed insiders to wield extraordinary policy power.

Item 6 turns to the legislative process, this time in the New Jersey legislature, on the topic of the legalization of marijuana. This story too falls on the positive side of the "function-dysfunction" spectrum, in that it describes a fairly rational and publicly visible process of fact-gathering and policy assessment by a number of New Jersey legislators, leading to the withdrawal of the legislation.

Item 7 turns to the mechanisms of private influence on government, in a particularly unsavory but revealing way. The story reveals details of a high-end dinner "to pa tribute to the guest of honor, Gov. Andrew M. Cuomo." The article writes, "Lobbyists told their clients that the event would be a good thing to go to", at a minimum ticket price of $25,000 per couple. This story connects the dots between private interest and efforts to influence governmental policy. In this case the dots are not very far apart.

With a little effort all these items could be mapped onto the diagram of the interconnections within and across government and external social groups provided above.

Wednesday, March 27, 2019

Regulatory failure and the 737 MAX disasters


The recent crashes of two Boeing 737 MAX aircraft raise questions about the safety certification process through which this modified airframe was certified for use by the FAA. Recent accounts of the design and manufacture of the aircraft demonstrate an enormous pressure for speed and great pressure to reduce costs. Attention has focused on a software system, MCAS, which was a feature needed to adapt to the aerodynamics created by repositioning of larger engines on the existing 737 body. The software was designed to automatically intervene to prevent stall if a single sensor in the nose indicated unacceptable angle of ascent. The crash investigations are not complete, but current suspicions are that the pilots in the two aircraft were unable to control or disable the nose-down response of the system in the roughly 40 seconds they had to recover control of the aircraft. (James Fallows provides a good and accessible account of the details of the development of the 737 MAX in a story in the Atlantic; link.)

The question here concerns the regulatory background of the aircraft: was the certification process through which the 737 MAX was certified to fly a sufficiently rigorous and independent one?

Thomas Kaplan details in a New York Times article the division of responsibility that has been created in the certification process over the past several decades between the FAA and the manufacturer (NYT 3/27/19). Under this program, the FAA delegates a substantial part of the work of certification evaluation to the manufacturer and its engineering staff. Kaplan writes:
In theory, delegating much of the day-to-day regulatory work to Boeing allows the FAA to focus its limited resources on the most critical safety work, taps into existing industry technical expertise at a time when airliners are becoming increasingly complex, and allows Boeing in particular to bring out new planes faster at a time of intense global competition with its European rival Airbus.
However, it is apparent to both outsiders and insiders that this creates the possibility of impairing the certification process by placing crucial parts of the evaluation in the hands of experts whose interests and careers lie in the hands of the corporation whose product they are evaluating. This is an inherent conflict of interest for the employee, and it is potentially a critical flaw in the process from the point of view of safety. (See an earlier post on the need for an independent and empowered safety officer within complex and risky processes; link.)

Senator Richard Blumenthal (Connecticut) highlighted this concern when he wrote to the inspector general last week: "The staff responsible for regulating aircraft safety are answerable to the manufacturers who profit from cutting corners, not the American people who may be put at risk."

A 2011 audit report from the Transportation Department's inspector general's office highlighted exactly this kind of issue: "The report cited an instance where FAA engineers were concerned about the 'integrity' of an employee acting on the agency's behalf at an unnamed manufacturer because the employee was 'advocating a position that directly opposed FAA rules on an aircraft fuel system in favor of the manufacturer'." The article makes the point that Congress has encouraged this program of delegation in order to constrain budget requirements for the federal agency.

Kaplan notes that there is also a worrisome degree of exchange of executive staff between the FAA and the airline industry, raising the possibility that the industry's priorities about cost and efficiency may unduly influence the regulatory agency:
The part of the FAA under scrutiny, the Transport Airplane Directorate, was led at the time by an aerospace engineer names Ali Bahrami. The next year, he took a job at the Aerospace Industries Association, a trade group whose members include Boeing. In that position, he urged his former agency to allow manufacturers like Boeing to perform as much of the work of certifying new planes as possible. Mr. Bahrami is now back at the FAA as its top safety official.
This episode illustrates one of the key dysfunctions of organizations that have been highlighted elsewhere here: the workings of conflict of commitment and interest within an organization, and the ability that the executives of an organization have to impose behavior and judgment on their employees that are at odds with the responsibilities these individuals have to other important social goods, including airline safety. The episode has a lot in common with the sequence of events leading to the launch of Space Shuttle Challenger (Vaughan, The Challenger Launch Decision: Risky Technology, Culture, and Deviance at NASA).

Charles Perrow has studied system failure extensively since publication of his important book, Normal Accidents: Living with High-Risk Technologies and extending through his 2011 book The Next Catastrophe: Reducing Our Vulnerabilities to Natural, Industrial, and Terrorist Disasters. In a 2015 article, "Cracks in the 'regulatory state'" (link), he summarizes some of his concerns about the effectiveness of the regulatory enterprise. The abstract of the article shows its relevance to the current case:
Over the last 30 years, the U.S. state has retreated from its regulatory responsibility over private-sector economic activities. Over the same period, a celebratory literature, mostly in political science, has developed, characterizing the current period as the rise of the regulatory state or regulatory capitalism. The notion of regulation in this literature, however, is a perverse one—one in which regulators mostly advise rather than direct, and industry and firm self- regulation is the norm. As a result, new and potentially dangerous technologies such as fracking or mortgage backed derivatives are left unregulated, and older necessary regulations such as prohibitions are weakened. This article provides a joint criticism of the celebratory literature and the deregulation reality, and strongly advocates for a new sociology of regulation that both recognizes and documents these failures. (203)
The 2015 article highlights some of the precise sources of failure that seem to be evident in the 737 MAX case. "Government assumes a coordinating rather than a directive role, in this account, as regulators draw upon industry best practices, its standard-setting proclamations, and encourage self-monitoring" (203). This is precisely what current reporting demonstrates about the FAA relationship to the manufacturers.

One of the key flaws of self-monitoring is the lack of truly independent inspectors:
Part of the problem stems from the failure of firms to select truly independent inspectors. Firms can, in fact, select their own inspectors—for example, firemen or police from the local areas who are quite conscious of the economic power of the local chemical firm they are to inspect. (205)
Here again, the Boeing 737 MAX certification story seems to illustrate this defect as well.
How serious are these "cracked regulatory institutions"? According to Perrow they are deadly serious. Here is Perrow's summary assessment about the relationship between regulatory failure and catastrophe:
Almost every major industrial accident in recent times has involved either regulatory failure or the deregulation demanded by business and industry. For more examples, see Perrow (2011). It is hard to make the case that the industries involved have failed to innovate because of federal regulation; in particular, I know of no innovations in the safety area that were stifled by regulation. Instead, we have a deregulated state and deregulated capitalism, and rising environmental problems accompanied by growing income and wealth inequality. (210)
In short, we seem to be at the beginning of an important reveal of the cost of neoliberal efforts to minimize regulation and to pass the responsibility for safety significantly to the manufacturer.

(Baldwin, Cave, and Lodge provide a good exposure to current thinking about government regulation in Understanding Regulation: Theory, Strategy, and Practice, 2nd Edition. Their Oxford Handbook of Regulation also provides excellent resources on this topic.)

Monday, March 25, 2019

Nuclear power plant siting decisions


Readers may be skeptical about the practical importance of the topic of nuclear power plant siting decisions, since very few new nuclear plants have been proposed or approved in the United States for decades. However, the topic is one for which there is an extensive historical record, and it is a process that illuminates the challenge for government to balance risk and benefit, private gain and public cost.  Moreover, siting inherently brings up issues that are both of concern to the public in general (throughout a state or region of the country) and to the citizens who live in close proximity to the recommended site. The NIMBY problem is unavoidable -- it is someone's backyard, and it is a worrisome neighbor. So this is a good case in terms of which to think creatively about the responsibilities of government for ensuring the public good in the face of risky private activity, and the detailed institutions of regulation and oversight that would work to make wise public outcomes more likely.

I've been thinking quite a bit recently about technology failure, government regulation, and risky technologies, and there is a lot to learn about these subjects by looking at the history of nuclear power in the United States. Two books in particular have been interesting to me. Neither is particularly recent, but both shed valuable light on the public-policy context of nuclear decision-making. The first is Joan Aron's account of the processes that led to the cancellation of the Shoreham nuclear power plant on Long Island in the 1970s (Licensed To Kill?: The Nuclear Regulatory Commission and the Shoreham Power Plant) and the second is Donald Stever, Jr.'s account of the licensing process for the Seabrook nuclear power plant in Seabrook and The Nuclear Regulatory Commission: The Licensing of a Nuclear Power Plant. Both are fascinating books and well worthy of study as a window into government decision-making and regulation. Stever's book is especially interesting because it is a highly capable analysis of the licensing process, both at the state level and at the level of the NRC, and because Stever himself was a participant. As an assistant attorney general in New Hampshire he was assigned the role of Counsel for the Public throughout the process in New Hampshire.

Joan Aron’s 1997 book Licensed to Kill? is a detailed case study the effort to establish the Shoreham nuclear power plant on Long Island in the 1980s. LILCO had proposed the plant to respond to rising demand for electricity on Long Island as population and energy use rose. And Long Island is a long, narrow island on which traffic congestion at certain times of day is legendary. Evacuation planning was both crucial and in the end, perhaps impossible.

This is an intriguing story, because it led eventually to the cancellation of the operating license for the plant by the NRC after completion of the plant. And the cancellation resulted largely from the effectiveness of public opposition and interest-group political pressure. Aron provides a detailed account of the decisions made by the public utility company LILCO, the AEC and NRC, New York state and local authorities, and citizen activist groups that led to the costliest failed investment in the history of nuclear power in the United States.

In 1991 the NRC made the decision to rescind the operating license for the Shoreham plant, after completion at a cost of over $5 billion but before it had generated a kilowatt of electricity.

Aron’s basic finding is that the project collapsed in costly fiasco because of a loss of trust among the diverse stakeholders: LILCO, the Long Island public, state and local agencies and officials, scientific experts, and the Nuclear Regulatory Commission. The Long Island tabloid Newsday played a role as well, sensationalizing every step of the process and contributing to public distrust of the process. Aron finds that the NRC and LILCO underestimated the need for full analysis of safety and emergency preparedness issues raised by the plant’s design, including the issue of evacuation from a largely inaccessible island full of two million people in the event of disaster. LILCO’s decision to upscale the capacity of the plant in the middle of the process contributed to the failure as well. And the occurrence of the Three Mile Island disaster in 1979 gave new urgency to the concerns experienced by citizens living within fifty miles of the Shoreham site about the risks of a nuclear plant.
As we have seen, Shoreham failed to operate because of intense public opposition, in which the governor played a key role, inspired in part by the utility’s management incompetence and distrust of the NRC. Inefficiencies in the NRC licensing process were largely irrelevant to the outcome. The public by and large ignored NRC’s findings and took the nonsafety of the plant for granted. (131)
The most influential issue was public safety: would it be possible to perform an orderly evacuation of the population near the plant in the event of a serious emergency? Clarke and Perrow (included in Helmut Anheier, ed., When Things Go Wrong: Organizational Failures and Breakdowns) provide an extensive analysis of the failures that occurred during tests of the emergency evacuation plan designed by LILCO. As they demonstrate, the errors that occurred during the evacuation test were both “normal” and potentially deadly.

One thing that comes out of both books is the fact that the commissioning and regulatory processes are far from ideal examples of the rational development of sound public policy. Rather, business interests, institutional shortcomings, lack of procedural knowledge by committee chairs, and dozens of other factors lead to outcomes that appear to fall far short of what the public needs. But in addition to ordinary intrusions into otherwise rational policy deliberations, there are other reasons to believe that decision-making is more complicated and less rational than a simple model of rational public policy formation would suggest. Every decision-maker brings a set of “framing assumptions” about the reality concerning which he or she is deliberating. These framing assumptions impose an unavoidable kind of cognitive bias into collective decision-making. A business executive brings a worldview to the question of regulation of risk that is quite different from that of an ecologist or an environmental activist. This is different from the point often made about self-interest; our framing assumptions do not feel like expressions of self-interest, but rather simply secure convictions about how the world works and what is important in the world. This is one reason why the work of social scientists like Scott Page (The Difference: How the Power of Diversity Creates Better Groups, Firms, Schools, and Societies) on the value of diversity in problem-solving and decision-making is so important: by bringing multiple perspectives and cognitive frames to a problem, we are more likely to get a balanced decision that gives appropriate weight to the legitimate interests and concerns of all involved.

Here is an interesting concrete illustration of cognitive bias (with a generous measure of self-interest as well) in Stever’s discussion of siting decisions for nuclear power plants:
From the time a utility makes the critical in-house decision to choose a site, any further study of alternatives is necessarily negative in approach. Once sufficient corporate assets have been sunk into the chosen site to produce data adequate for state site review, the company's management has a large enough stake in it to resist suggestions that a full study of site alternatives be undertaken as a part of the state (or for that matter as a part of the NEPA) review process. hence, the company's methodological approach to evaluating alternates to the chosen site will always be oriented toward the desired conclusion that the chosen site is superior. (Stever 1980 : 30)
This is the bias of sunk costs, both inside the organization and in the cognitive frames of independent decision makers in state agencies.

Stever’s central point here is a very important one: the pace of site selection favors the energy company’s choices over the concerns and preferences of affected groups because the company is in a position to have dedicated substantial resources to development of the preferred site proposal. Likewise, scientific experts have a difficult time making their concerns about habitat or traffic flow heard in the context.

But here is a crucial thing to observe: the siting decision is only one of dozens in the development of a new power plant, which is itself only one of hundreds of government / business decisions made every year. What Stever describes is a structural bias in the regulatory process, not a one-off flaw. At its bottom, this is the task that government faces when considering the creation of a new nuclear power plant: “to assess the various public and private costs and benefits of a site proposed by a utility” (32); and Stever’s analysis makes it doubtful that existing public processes do this in a consistent and effective way. Stever argues that government needs to have more of a role in site selection, not less, as pro-market advocates demand: “The kind of social and environmental cost accounting required for a balanced initial assessment of, and development of, alternative sites should be done by a public body acting not as a reviewer of private choices, but as an active planner” (32).



Notice how this scheme shifts the pace and process from the company to the relevant state agency. The preliminary site selection and screening is done by a state site planning agency, with input then invited from the utilities companies, interest groups, and a formal environmental assessment. This places the power squarely in the hands of the government agency rather than the private owner of the plant -- reflecting the overriding interest the public has in ensuring health, safety, and environmental controls.

Stever closes a chapter on regulatory issues with these cogent recommendations (38-39):
  1. Electric utility companies should not be responsible for decisions concerning early nuclear-site planning.
  2. Early site identification, evaluation, and inventorying is a public responsibility that should be undertaken by a public agency, with formal participation by utilities and interest groups, based upon criteria developed by the state legislature.
  3. Prior to the use of a particular site, the state should prepare a complete environmental assessment for it, and hold adjudicatory hearings on contested issues.
  4. Further effort should be made toward assessing the public risk of nuclear power plant sites.
  5. In areas like New England, characterized by geographically small states and high energy demand, serious efforts should be made to develop regional site planning and evaluation.
  6. Nuclear licensing reform should focus on the quality of decision-making.
  7. There should be a continued federal presence in nuclear site selection, and the resolution of environmental problems should not be delegated entirely to the states. 
(It is very interesting to me that I have not been able to locate a full organizational study of the Nuclear Regulatory Commission itself.)

Thursday, March 21, 2019

Philosophy of technology?



Is there such a thing as “philosophy of technology”? Is there a “philosophy of cooking” or a “philosophy of architecture”? All of these are practical activities – praxis – with large bodies of specialized knowledge and skill involved in their performance. But where does philosophy come in?

Most of us trained in analytic philosophy think of a philosophical topic as one that can be formulated in terms of a small number of familiar questions: what are the nature and limitations of knowledge in this area? What ethical or normative problems does this area raise? What kinds of conceptual issues need to be addressed before we can discuss problems in this area clearly and intelligently? Are there metaphysical issues raised by this area -- special kinds of things that need special philosophical attention? Does "technology" support this kind of analytical approach?

We might choose to pursue a philosophy of technology in an especially minimalist (and somewhat Aristotelian) way, along these lines:
  • Human beings have needs and desires that require material objects for their satisfaction. 
  • Human beings engage in practical activity to satisfy their needs and desires.
  • Intelligent beings often seek to utilize and modify their environments so as to satisfy their needs and desires. 
  • Physical bodies are capable of rudimentary environment modification, which may permit adequate satisfaction of needs and desires in propitious environments (dolphins).
  • Intelligent beings often seek to develop "tools" to extend the powers of their bodies to engage in environment modification.
  • The use of tools produces benefits and harms for self and others, which raises ethical issues.
Now we can introduce the idea of the accumulation of knowledge ("science"):
  • Human beings have the capacity to learn how the world around them works, and they can learn the causal properties of materials and natural entities. 
  • Knowledge of causal properties permits intelligent intervention in the world.
  • Gaining scientific knowledge of the world creates the possibility of the invention of knowledge-based artifacts (instruments, tools, weapons).
And history suggests we need to add a few Hobbesian premises:
  • Human beings often find themselves in conflict with other agents for resources supporting the satisfaction of their needs and desires.
  • Intelligent beings seek to develop tools (weapons) to extend the powers of their bodies to engage in successful conflict with other agents.
Finally, history seems to make it clear that tools, machines, and weapons are not purely individual products; rather, social circumstances and social conflict influence the development of the specific kinds of tools, machines, and weapons that are created in a particular historical setting.

The idea of technology can now be fitted into the premises identified here. Technology is the sum of a set of tools, machines, and practical skills available at a given time in a given culture through which needs and interests are satisfied and the dialectic of power and conflict furthered.

This treatment suggests several leading questions for a philosophy of technology:
  1. How does technology relate to human nature and human needs?
  2. How does technology relate to intelligence and creativity?
  3. How does technology relate to scientific knowledge?
  4. How does technology fit into the logic of warfare?
  5. How does technology fit into the dialectic of social control among groups?
  6. How does technology relate to the social, historical, and cultural environment?
  7. Is the process of technology change determined by the technical characteristics of the technology?
  8. How does technology relate to issues of justice and morality?
Here are a few important contributions to several of these topics.

Lynn White's Medieval Technology and Social Change illustrates almost all elements of this configuration. His classic book begins with the dynamics of medieval warfare (the impact of the development of the stirrup on mounted combat); proceeds to food production (the development and social impact of the heavy iron plough); and closes with medieval machines.

Charles Sabel's treatment of industrialization and the creation of powered machinery in Work and Politics: The Division of Labour in Industry addresses topic 5; Sabel demonstrates how industrialization and the specific character of mechanization that ensued was a process substantially guided by conflicts of interest between workers and owners, and technologies were selected by owners that reduced the powers of resistance of workers. Sabel and Zeitlin make this argument in greater detail in World of Possibilities: Flexibility and Mass Production in Western Industrialization. One of their most basic arguments is the idea that firms are strategic and adaptive as they deal with a current set of business challenges. Rather than an inevitable logic of new technologies and their organizational needs, we see a highly adaptive and selective process in which firms pick and choose among alternatives, often mixing the choices to hedge against failure. They consider carefully a range of possible changes on the horizon, a set of possible strategic adaptations that might be selected; and they frequently hedge their bets by investing in both the old and the new technology. "Economic agents, we found again and again in the course of the seminar's work, do not maximize so much as they strategize" (5). (Here is a more extensive discussion of Sabel and Zeitlin; link.)

The logic underlying the idea of technological inevitability (topic 7) goes something like this: a new technology creates a set of reasonably accessible new possibilities for achieving new forms of value: new products, more productive farming techniques, or new ways of satisfying common human needs. Once the technology exists, agents or organizations in society will recognize those new opportunities and will attempt to take advantage of them by investing in the technology and developing it more fully. Some of these attempts will fail, but others will succeed. So over time, the inherent potential of the technology will be realized; the technology will be fully exploited and utilized. And, often enough, the technology will both require and force a new set of social institutions to permit its full utilization; here again, agents will recognize opportunities for gain in the creation of social innovations, and will work towards implementing these social changes.

This view of history doesn't stand up to scrutiny, however. There are many examples of technologies that failed to come to full development (the water mill in the ancient world and the Betamax in the contemporary world). There is nothing inevitable about the way in which a technology will develop -- imposed, perhaps, by the underlying scientific realities of the technology; and there are numerous illustrations of a more complex back-and-forth between social conditions and the development of a technology. So technological determinism is not a credible historical theory.

Thomas Hughes addresses topic 6 in his book, Human-Built World: How to Think about Technology and Culture. Here Hughes considers how technology has affected our cultures in the past two centuries. The twentieth-century city, for example, could not have existed without the inventions of electricity, steel buildings, elevators, railroads, and modern waste-treatment technologies. So technology "created" the modern city. But it is also clear that life in the twentieth-century city was transformative for the several generations of rural people who migrated to them. And the literature, art, values, and social consciousness of people in the twentieth century have surely been affected by these new technology systems. Each part of this complex story involves processes that are highly contingent and highly intertwined with social, economic, and political relationships. And the ultimate shape of the technology is the result of decisions and pressures exerted throughout the web of relationships through which the technology took shape. But here is an important point: there is no moment in this story where it is possible to put "technology" on one side and "social context" on the other. Instead, the technology and the society develop together.

Peter Galison's treatment of the simultaneous discovery of the relativity of time measurement by Einstein and PoincarĂ© in Einstein's Clocks and PoincarĂ©'s Maps: Empires of Time provides a valuable set of insights into topic 3. Galison shows that Einstein's thinking was very much influenced by practical issues in the measurement of time by mechanical devices. This has an interesting corollary: the scientific imagination is sometimes stimulated by technology issues, just as technology solutions are created through imaginative use of new scientific theories.

Topic 8 has produced an entire field of research of its own. The morality of the use of autonomous drones in warfare; the ethical issues raised by CRISPR technology in human embryos; the issues of justice and opportunity created by the digital divide between affluent people and poor people; privacy issues created by ubiquitous facial recognition technology -- all these topics raise important moral and social-justice issues. Here is an interesting thought piece by Michael Lynch in the Guardian on the topic of digital privacy (link). Lynch is the author of The Internet of Us: Knowing More and Understanding Less in the Age of Big Data.

So, yes, there is such a thing as the philosophy of technology. But to be a vibrant and intellectually creative field, it needs to be cross-disciplinary, and as interested in the social and historical context of technology as it is the conceptual and normative issues raised by the field.

Tuesday, March 12, 2019

Conflicts of interest


The possibility or likelihood of conflict of interest is present in virtually all professions and occupations. We expect a researcher, a physician, or a legislator to perform her work according to the highest values and norms of their work (searching for objective knowledge, providing the best care possible for the patient, drafting and supporting legislation in order to enhance the public good). But there is always the possibility that the individual may have private financial interests that distort or bias the work she does, and there may be large companies that have a financial interest in one set of actions rather than another.

Marc Rodwin's Conflicts of Interest and the Future of Medicine: The United States, France, and Japan is a rigorous and fair treatment of this issue with respect to conflicts of interest in the field of medicine. Rodwin has published extensively on this topic, and the current book is an important exploration of how professional ethics, individual interest, and business and professional institutions intersect to influence practitioner behavior in this field. The institutional actors in this story include the pharmaceutical companies and medical device manufacturers, insurers, hospitals and physician partnerships, and legislators and regulators. Rodwin shows in detail how differences in insurance policies, physician reimbursement policies, and gifts and benefits from health-related businesses to physicians contribute to an institutional environment where the physician's choices are all too easily influenced by considerations other than the best health outcomes of the patient. Rodwin finds that the institutional setting for health economics is different in the US, France, and Japan, and that these differences lead to differences in physician behavior.

Here is Rodwin's clear statement of the material situation that creates the possibility or likelihood of conflicts of interest in medicine.
Physicians earn their living through their medical work and so may practice in ways that enhance their income rather than the interests of patients. Moreover, when physicians prescribe drugs, devices, and treatments and choose who supplies these or refer patients to other providers, they affect the fortunes of third parties. As a result, providers, suppliers, and insurers try to influence physicians' clinical decisions for their own benefit. Thus, at the core of doctoring lies tension between self-interest and faithful service to patients and the public. The prevailing powerful medical ethos does influence physicians. Still, there is conflict between professional ethics and financial incentives. (kl 251)
Jerome Kassirer is a former editor-in-chief of the New England Journal of Medicine, and an expert observer of the field, and he provided a foreword to the book. Kassirer describes the current situation in the medical economy in these terms, drawing on his own synthesis of recent research and journalism:
Professionalism had been steadily eroded by complex financial ties between practicing physicians and academic physicians on the one hand and the pharmaceutical, medical device, and biotechnology industries on the other. These financial ties were deep and wide: they threatened to bias the clinical research on which physicians relied to care for the sick, and they permeated nearly every aspect of medical care. Physicians were accepting gifts, taking free trips, serving on companies' speakers' bureaus, signing their names to articles written for them by industry-paid ghostwriters, and engaging in research that endangered patient care. (kl 73)
The fundamental problem posed by Rodwin's book is this set of questions:
In what context can physicians be trusted to act in their patients' interests? How can medical practice be organized to minimize physicians' conflicts of interest? How can society promote what is best in medical professionalism? What roles should physicians and organized medicine play in the medical economy? What roles should insurers, the state, and markets play in medical care? (kl 267)
The book sheds light on dozens of institutional arrangements that create the likelihood of conflicted choices, or that reduce that likelihood. One of those arrangements is the question for a non-profit hospital of whether the physicians are employed with a fixed salary or work on a fee-for-service basis. The latter system gives the physician a very different set of financial interests, including the possibility of making clinical choices that increase revenues to the physician or his or her group practice.
Consider physicians employed as public servants in public hospitals. Typically, they receive a fixed salary set by rank, enjoy tenure, and have clinical discretion. As a result, they lack financial incentives that bias their choices and have clinical freedom. Such arrangements preclude employment conflicts of interest. But relax some of these conditions and employers can compromise medical practice.... Furthermore, emplloyers can manage physicians to promote the organization's goals. As a result, employed physicians might practice in ways that promote their employer's over their patients' interests. (kl 445)
And the disadvantages for the patient of the self-employed physician are also important:
Payment can encourage physicians to supply more, less, or different kinds of services, or to refer to particular providers. Each form of payment has some bias, but some compromise clinical decisions more than others do. (kl 445) 
Plainly, the circumstances and economic institutions described here are relevant to many other occupations as well. Scientists, policymakers, regulators, professors, and accountants all face similar circumstances -- though the financial stakes in medicine are particularly high. (Here is an earlier post on corporate efforts to influence scientific research; link.)

This field of research makes an important contribution to a particular challenging topic in contemporary healthcare. But Rodwin's study also provides an important contribution to the new institutionalism, since it serves as a micro-level case study of the differences in behavior created by differences in institutional rules and practices.
Each country's laws, insurance, and medical institutions shape medical practice; and within each country, different forms of practice affect clinical choices. (kl 218)
This feature of the book allows it to contribute to the kinds of arguments on the causal and historical importance of specific configurations of institutions offered by Kathleen Thelen (link) and Frank Dobbin (link).