On October 29, 2018, a passenger airliner crashed into the sea less than 13 minutes after takeoff from Jakarta, Indonesia. A few months later, a second plane crashed over Ethiopia. In total, 346 people were killed.
Both planes were the brand new Boeing 737 Max. Investigation placed the responsibility squarely with Boeing, the manufacturer. As news reports explained, Boeing had made technical changes that were not thoroughly tested and, as a deliberate policy choice to save money, had hidden these changes from both regulators and the pilots who would be flying those planes. The pilots had not been trained on how to handle a malfunction of the new feature.
The world’s most trusted airplane manufacturer had undergone a change of philosophy several years earlier. Following a merger and new management, the company abandoned its culture of excellence in favor of a focus on profit and stock price.
Employee reports of safety problems were ignored. Millions of airline passengers, including you and me, were put at risk. But because the company was so trusted, federal regulators allowed the company to use its own employees for some of the safety analysis that should have been done by government inspectors. All this has been widely reported.
At a hearing in 2020, then-New Mexico Sen. Tom Udall said, “This continues to be a case study of the complete and total failure of self-regulation.” Please read that again: “complete and total failure of self-regulation.”
Boeing was charged with conspiracy to defraud the Federal Aviation Administration and agreed to payments of more than $2.5 billion, including both penalties to the government and compensation to the crash victims’ families.
And then, as we all know, on Jan. 5 of this year a door flew off one of these airplanes a few minutes after takeoff.
How many more times do we have to repeat this painful lesson before we finally remember it? Self-regulation doesn’t work. While it might appear to work in the short term, it exposes the consuming public to the whims of other people’s self-interest.
The tension between industry and regulators helps to keep those greedier impulses in check.
Human nature is such that when regulators are not around to hold the line, eventually somebody will be tempted to get greedy or sloppy and take shortcuts. The honest employees who follow the rules will be edged out by adventurous types who provide a short-term competitive advantage because they have no compunctions about taking risks with their customers’ lives or fortunes. When something terrible finally happens we shrug our shoulders and wonder how this was allowed to take place.
This is what happened to the financial industry that led to the economic crash of 2008 – though the story was very different and the victims lost their homes, not their lives. That disaster resulted in part from the repeal of a Depression-era federal law called Glass-Steagall, which had been enacted to prevent exactly what happened.
New Mexico regulates numerous industries through programs in several state agencies. In recent years I’ve written about the requirement to sanitize the holding tanks in trucks that carry milk from the farm to the bottling plant, the testing of gasoline before you pump it into your car and other regulations.
A friend of mine worked at Sandia National Laboratories in a position involving safe disposal of hazardous radioactive materials, accountable to the state Environment Department. He told me no one in his group ever lied to the state agency, partly because it was the right thing to do and partly because the penalty for lying could be as much as 30 years in prison.
My friend said the threat of the penalty was a great motivator for that educated workforce. Contact Merilee Dannemann through www.triplespacedagain.com.