By preventing the coverup and additional losses because the manufacturer would have MOTIVE not to do so.How would it have prevented the coverup? I am having a hard time seeing that.
Company X has a car that is selling well. Re-engineering it would be prohibitively expensive for the next generation, and revealing the problem would cause people to want their current model to be fixed. It would harm the marketing of other models, since people would rightfully be concerned about the quality control at Company X.
To me, I still see a motive to coverup. What two differences I see are conflicting in their effect: 1)the governmental penalties may be less (which works towards diminishing the motive to cover up) and 2) the liklihood of any coverup being discovered and successfully brought to full public knowledge without the resources of government to force it decreases (which works towards increasing the liklihood of coverup).
Good systems prevent problems.Possibly true. I think a more accurate statement is "good systems are characterized by a minimum of problems as measured by number and scale".
Remember that the certifier has access to audit. If the cases continue to mount, it costs them.You don't think it would become likely that the same sort of destructive, conflict-of-interest laden, relationships would develop between the certifier and the producers as happened between Enron and Andersen?
Not if they successfully do cover it up. Avoidance of costs is a motive to cover up, and premiums are a cost.How would it have caused an adverse condition to a group of individuals deciding to cover up some damaging facts or actions?Their premiums go up because they are a high risk.
The criminal penalties remain in force. This is about getting rid of the DOT, not the DOJ.It may be on this that I am misunderstanding the proposal. What would the role of the DOJ be (summary, I am not asking you to give away the book)?
Again, both Andersen and and Enron got preferential allowances out of the SEC that violated the rational principles of control system design. The reason those conflicts of interest existed is because they could buy preferential treatment from Bubba for cheaper than the insurance premiums for a settlement. If for example, the SEC had to cough up the dough if either Enron or Andersen failed, you can bloody well bet that they would have done more to prevent the problem. Becuase they are a monopoly and can pass that liability onto voters, they do not behave rationally. There is no accountability in civic regulation and I defy you to cite a Congressman or Senator who lost his job over this case. Indeed, Bush is being blamed instead, which cuts precisely to the evil of democratic control of property.
In the case of Ford or Firestone, both products were tested to DOT standards. That protected the manufacturers from the economic need to to develop better preventative testing and limited the degree of culpable neglegence. Compliance was all that was necessary and limited the liability of both companies. I contend that the trial lawyers are enough to put the fear of God into any company.
The biggest flaw (if you could call it that) in my proposal is the existing system of torts and insurance regulation. They both distort the motive to manage and reduce risk objectively. What you observe in the marketplace is manifestation of those distortions in part caused by civic intervention. I made the early decision that it is impossible to design a just system around an injustice. It is better to make the consequences of injustice more visible so that the problem gets fixed. That is a political problem and, yes, we do need legislation there.
I propose NO changes in congressional legislation, indeed, my intent is to use environmental law agains the government and its colluding environmental NGOs. It is the unconstitutional rulemaking process I am attacking where the power to draft, adminster, enforce, and judge are combined into a single agency. That violation of the separation of powers principle is the essence of a police state, the continuation of which is what you have said you prefer.
No thank you. As I said, I am not an anarchist. The democratic tyranny of civic control of property in response to the whims of media is doing more to lead us into anarchy than anything I propose. You do not understand enough of the antithesis in the book to see it.
I am not going to answer any more of these hypotheticals (I don't have the time). If you want to know more, buy a book and read it.