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This has been less than a stellar year for business: Toyota made cars that would not stop, financial companies exploded, and BP had an explosion that created an oil leak that would not stop.
While these are three different types of disaster, there is a recurring theme in each case. To be specific, it was found that the regulators were sometimes just a bit too cozy with the folks they were supposed to regulate. While such coziness is hardly shocking, it was a bit surprising to learn that some of the financial foxes guarding the other financial foxes (to keep them from running wild in the economic hen house) were viewing naked foxes online. In the latest disaster, the BP oil spill, the regulatory agency folks seem to have been cozy with the drilling companies and some were also apparently viewing porn. A new twist is that at least one regulator admits to using Meth. God only knows what will be next.
The coziness problem seems to stem from the usual suspects: the laws and the people.
One problem in these cases is that there seems to be a lack of effective control over how cozy the regulators can get with the regulated. This aspect of the problem can be addressed with revised regulations (and enforcement of existing laws). Some obvious fixes include outlawing gifts, having regular “inspections” of regulators to determine what they are doing (or not doing), and checking for conflicts of interest (such as close relations to the folks in the industry to be regulated). Other fixes including having stronger regulations that are harder to bypass or work around. After all, weak points in the laws make it easier for corruption to grab hold. Of course, these weak points are not the fault of the regulators-they are created by politicians by accident or by design. In the case of designed weak points and loop holes, these serve to undermine good regulatory practices by building in ways for companies to get around regulations. Typically companies have to use their influence to take advantages of weak points, which is how corruption can get started.
Of course, regulations can only be as good as the people who enforce them (or fail to do so). A country could have very good laws, but the folks who are supposed to implement them could lack the will or the desire to do so. This could be due to moral weakness on the part of the enforcers or some other factors (such as a lack of support on the part of the law makers). The solution to this problem involves getting ethical and competent people into such positions and taking steps to ensure that they do not succumb to corruption or frustration.
As a final point, I want to discuss the drugs and the porn. My rough hypothesis is that the cozy relationships played a causal role. One possibility is that corruption breeds corruption. In other words, when a person has a moral weakness in one area, it makes it easier for other moral weakness to take hold. So, a person who is willing to be unduly influenced by companies might find that this vice enables other vices to grow in relative strength. This can also lead to an overall culture of corruption in the workplace, leading to a general decay.
A second possibility is that one corruption did not contribute to another, but that both are the effects of bad character. That is, a person who is not morally upstanding would tend to engage in a range of morally questionable behavior, ranging from accepting corporate gifts to using illegal drugs.
A third possibility is that the cozy relation between industry and the regulators has left the regulators with little real work to do. As the saying goes, idle hands do the devil’s work (that is, clicking links to porn or using drugs).
In any case, moral flaws seem to be among the causal factors of the recent disasters.