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By Robert B. Reich
In the real world, corporations exist for one purpose, and one purpose only -- to make as much money as possible, which means cutting costs as much as possible.
Yet American safety officials have long thought the smaller design more vulnerable to explosion and rupture in emergencies than competing designs. (By the way, the same design is used in 23 American nuclear reactors at 16 plants.)
In the mid-1980s, Harold Denton, then an official with the
The national commission appointed to investigate the giant oil spill in the Gulf of Mexico last April recently concluded that BP failed to adequately supervise
This was the case even though BP knew
And so on.
Don't get me wrong: No company can be expected to build a nuclear reactor, an oil well, a coal mine or anything else that's 100 percent safe under all circumstances. The costs would be prohibitive. It's unreasonable to expect corporations to totally guard against small chances of every potential accident.
Inevitably there's a trade-off. Reasonable precaution means spending as much on safety as the probability of a particular disaster occurring, multiplied by its likely harm to human beings and the environment if it does occur.
Here's the problem: Profit-making corporations have every incentive to underestimate these probabilities and lowball the likely harms. This is why it's necessary to have such things as government regulators, and why regulators need enough resources to enforce the regulations.
And it's why recent proposals in
It's also why regulators have to be independent of the industries they regulate. When there's a revolving door between regulatory agency and industry, officials are reluctant to bite the hands that will feed them.
In Japan, it's common for regulators to retire to better-paid jobs in the industries they're supposed to regulate, a practice known there as "amakudari."
If this also sounds familiar, it is. Remember the
Finally, the tendency of corporations to understate the probabilities of public harms requires that limits be placed on corporate political power. The public cannot not be adequately protected as long as big corporations -- GE, BP,
Public safety doesn't have to be wildly expensive. But regulators and regulatory agencies have to be independent and smart.
Robert Reich, former U.S. Secretary of Labor, is professor of public policy at the
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Copyright ©, ROBERT REICH; DISTRIBUTED BY TRIBUNE MEDIA SERVICES, INC.
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