Government can save more lives by regulating smarter
Contact:
Laura Jones, Director,
Centre for Studies in Risk and Regulation, The Fraser Institute
Telephone: (604) 714-4547
Email: lauraj@fraserinstitute.caRelease Date: 11 October 2000
VANCOUVER, BC — Governments can save more lives by regulating smarter says a new book, Safe Enough? Managing Risk and Regulation, released today by The Fraser Institute.
In many cases, expenditure to reduce a risk could save many more years of life if spent reducing other risks. In some cases, regulations to address one threat can actually introduce other, more serious threats. The book, with contributions from noted public policy analysts and economists, focuses on the importance of basing decisions about risk regulation on sound science and economics.
William Stanbury, retired professor of competition and regulatory policy at the University of British Columbia, points out that an increasing amount of government regulation in Canada is devoted to reducing risks associated with transportation. However, according to Statistics Canada, 40 women die in commercial air travel accidents annually. By contrast 5,000 women die each year of breast cancer. A one percent reduction in the deaths due to breast cancer will save more lives than a 100 percent reduction in deaths due to air travel.
According to Tammy O. Tengs, from Duke University's Centre for Health Policy, "government regulations save fewer lives than they might, given the resources consumed, and consume more resources than necessary, given the survival benefits offered." Tengs evaluated the cost-effectiveness of 139 government regulations that consumed $4.11 billion annually and saved 94,000 years of life in the United States. She shows that the same $4.11 billion invested in the most cost-effective regulations could save more than twice as many years of life — 211,000 annually.
"Governments are not regulating risk rationally, in part because they are responding to the agendas of interest groups, which are reinforced by media coverage" explains Laura Jones, the book's editor and Director of the Centre for Studies in Risk and Regulation at The Fraser Institute.
"As life expectancy reaches record highs and Canadians become more affluent, there are constant calls for government to create a 'risk-free' society. This decreased tolerance to risk has made us susceptible to costly and counter-productive scares based on junk science," continues Jones.
For example, despite evidence that genetically engineered foods are often better for the environment, contain lower levels of natural toxins, and are rigorously tested, Douglas Powell, director of Guelph University's Agri-Food Risk Management and Communications project, describes how "a combination of scientific naivete, media hyperbole, and allegations of corporate conspiracy have come to characterize public discussions of genetically engineered foods."
Policy makers often ignore or underestimate the unintended consequences of proposals designed to eliminate risk. Transportation economist William Waters points out that following the fuel crisis in the 1970s, the United States attempted to increase the fuel economy of automobiles through regulations. The down-sizing of cars in response to these new regulations resulted in a 14 to 27 percent reduction in safety.
Stanbury argues that the Canadian government's management of risk regulation is marked by a lack of economic analysis, haphazard selection of risks for government action, lack of collaboration between government departments, one-size-fits-all types of government action to deal with risks, and poor risk communications to the public.
Stanbury sets out a number of recommendations for improving "government decision-making relating to efforts to control, reduce, and cope with risks to life, limb, and wallet":
- Establishment of a government-wide, risk management policy to guide the many departments and agencies which design and implement government actions on risk issues;
- Create a "risk-reduction budget," to rationalize society's mandated expenditures for risk reduction;
- Increasing the amount of information routinely disclosed about risk management activities;
- Mandating better analysis of risk such as risk assessments, and cost-benefit analysis;
- A systematic effort to rank risks in terms of their importance, and to establish priorities for government action.
"Clearly, the idea is not to eliminate all existing risk-reduction regulation but to avoid adding inefficient and counter-productive new ones," concludes Jones.
Established in 1974, The Fraser Institute is an independent public policy organization based in Vancouver, with offices in Calgary and Toronto.
For further information regarding Safe Enough? Managing Risk and Regulation contact:
Suzanne Walters, Director of Communications,
The Fraser Institute, (604) 714-4582,
Email suzannew@fraserinstitute.ca
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