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:: Saturday, February 22, 2003 ::

Why Regulation Doesn't Work

It didn't take long for regulation experts to get on the tube yesterday talking about how lax enforcement of local fire and safety codes is a danger around the country. I fully expect city councils and county commissioners and any other regulatory agency you can find will be passing new codes, beefed up penalties and increased budgets for inspectors. Your local nightclubs will be jumping through hoops for some time trying to keep up with the new wave of inspections and nanny types nosing around their places of business. Ever wonder how many of these experts are consultants who will make money from this situation?
Will you be safer for it? Not much. Why? Because these sorts of regulations fall under the realm of the political process. Here's some more of the predictable dialog that follows this sort of tragedy: (from the Denver Post)

A deadly flash fire, like the blaze that destroyed a West Warwick, R.I., nightclub called The Station, killing at least 95 people late Thursday, is not likely to happen in Denver any time soon, city fire officials said Friday.
That is, as long as club and theater owners comply with the city's inch-thick set of fire-code rules, Gonzales said.
"We have a few problems, but the vast majority of the clubs in our city have responsible owners that follow the rules," said Gonzales, who runs the Fire Department's fire-prevention and inspection division.
That is partly because the city is vigilant about enforcing its fire code, and the spaces that house nightclubs are monitored carefully, from design and construction through opening of the clubs' doors.

All well and good, but do you think, if asked the same question earlier in the week, fire officials in West Warwick, RI would have answered differently?
Certainly nightclub managers will be looking at their clubs with a fresh eye on safety in the coming days. But if history is a guide, we can expect that in a few years the furor over club and concert safety will die down, and the situation will slowly go back to the way things were a few days ago. That is in part because the political pressure to regulate the clubs will die down as public attention is diverted elsewhere.
There is no perfect solution to such problems, but there are ways to alleviate them. One is to shift the responsibility of safety inspection from governmental bodies to the organizations that are financially liable for injuries caused by negligence. Financial liability does not wane with time, and encourages long term vigilance. For instance, if insurance companies were forced to do their own inspections they might be much more strict than local government. It's doubtful that any insurance company would allow the Chicago nightclub E2 to stay open, and the prospect of losing liability coverage might be more daunting to the owners than city imposed sanctions. Could irresponsible club operators still exist under such a system? Of course they could. Accidents would still happen, and both of the recent tragedies seem to involve individuals knowingly skirting safety regulation. But it is sobering to think that private sector safety enforcement might have saved quite a few lives over the last week or two.

:: Walter 6:45 AM [+] ::

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