The
Honorable Mitchell E. Daniels, Jr.
Warren T. Brookes Address delivered to Competitive Enterprise Institute
May 22, 2002 at the Capital Hilton, Washington, D.C.
Thank you all so much. It's quite an honor and quite a pleasure
to be with you tonight. I'd like to salute the organizers of the
evening for the way they structured your program, particularly the
healthy length of the cocktail hour [laughter]; they have provided
me with Mark Twain's definition of the perfect audience, which he
said was intelligent, informed, inquisitive, and drunk [laughter].
A great way to start off. Fred and Fran Smith, it's so great to
be with you two. Fred you do not have, do not share, one characteristic,
with my favorite football coach of all time, Bum Phillips. Bum Phillips
said that he took his wife everywhere because she was too ugly to
kiss goodbye [laughter]. But Fran is quite lovely, and such an important
contributor as we are reminded in her own right.
We've just had an academic event in the Daniels family. The eldest
of our four daughters just graduated last Sunday from a fine liberal
arts school in Ohio with high honors. Made Dad proud. Meagan did
however, somewhat to my regret, as too many kids I think do these
days, flit from major to major. She changed midstream from philosophy
to geography, so she graduated knowing where she was, but not why
[laughter]. And I miss those dinner table conversations before the
change, those intriguing metaphysical speculations she and I had
a brief opportunity to engage in - with questions like, 'If James
Carville and Geraldo Rivera were both drowning, and you could only
save one [laughter], would you read the paper, or eat lunch [laughter
and applause]?'
I do get to hang out in the office I'm going to talk about tonight,
the Office of Information and Regulatory Affairs -- OIRA -- in OMB,
where we have new leadership I'm going to brag about and a very,
very learned and academically talented group, many of them of course
proficient in, in narrow technical specialties. This leads to some
quirks, of course, as two of our OIRA statisticians I discovered
went duck hunting last weekend -- with strange results. Not much
action all day long. Finally, late in the day, one lonely duck flew
over; the first guy leaps up, fires away, missed three feet high.
Next guy jumps up, boom, three feet low. They high-fived, "We
got him!" [laughter]
We work in the realm there of cost benefit analysis, a strangely
controversial thing from time to time to time. We have to, I think,
slowly, gradually, methodically, put it back in its rightful place,
its commonsense place in the making of public policy. We need to
remind people, that cost benefit analysis is part of everyday life.
Perhaps you've heard of the couple out dining one evening, when
a lovely, much younger lady passed by the table and visibly winked
at the husband. His wife, not missing a thing, said, "Who was
that?" After some hemming and hawing, he finally confesses:
it's his mistress. She said, "That's it! I always feared and
suspected. It's over, I want a divorce." "Now dear, not
so fast. You [do] realize if that happens, no more diamonds on your
birthday, fewer of those shopping trips to New York, what about
the country club charge account?" About that time, another
couple passed by and she said, "Isn't that your friend Jim
from the office?" He said, "Yes." "Well who's
that young woman with him?" "Well, that's Jim's mistress."
She says, "Aha! Ours is prettier." [laughter]
I think a lot of important and true things have been said about
the two men that were here to think about, remember fondly, even
reverently tonight. I need to say my two cents about Warren Brookes
and Julian Simon, each whom I was able to know, not so well as many
of you, but able to know well enough to understand their unique
qualities, their unique quirks, their unique importance in our times.
These were men of genuine integrity and of a most important sort.
These were men of intellectual integrity. They followed the facts.
They had great respect for science. They had great respect for the
data, which they studied and always tried to base their well-reasoned
and very, very persuasive conclusions. I used to work in a data-intensive
business for a long, long time, as Jim [Tozzi] mentioned. Our scientists
at Eli Lilly used to say, "If we torture the data long enough,
it will confess." [laughter] Well, neither Warren Brookes nor
Julian Simon tortured data. Rather, they extracted from it, the
knowledge they could, to base the sound advice and counsel and conclusions
which they shared with the rest of us. I read to prepare for tonight
Tom Bray's anthology, called Unconventional Wisdoms: The Best of
Warren Brookes. It's fabulous. On every page there is a memory,
there is an insight that we forgot. And there's a reminder of how
rare was that combination of journalistic and intellectual and personal
qualities that he embodied. We're all reminded over and over by
our own experience, by all the wisest philosophers, that no person
is irreplaceable. Maybe one day it will be true in Warren Brookes'
case, but have you noticed, that more than a decade later, we have
not replaced him? Maybe one of the fellows who has been honored
in his name will rise one day to fill that void.
Julian Simon was an original founding father of the Hudson Institute,
which I was associated with for a long time. A typical Hudson Institute
or CEI optimist, not in a mindless sense or a thoughtless way, but
simply an optimist who knew that human ingenuity, human talent,
human passion for improvement were more than a match for the challenges
of any age we've faced or will. And Julian, like Warren Brookes,
had the ability to enliven his various visions with wit and ability
to communicate. His famous bet which you all recall, which is commemorated
in our program, with Dr. Paul Ehrlich - Paul Ehrlich -- who we know
won the MacArthur Prize for genius [laughter]. What do they give
to people who are right? [laughter and applause] I don't know if
the people on that jury are golfers or not, but if they are, don't
you think they'd ask for a Mulligan once in a while? [laughter]
Julian Simon demonstrated that Ehrlich and people like him are the
heirs to Leon Trotsky -- not in the sense you may suspect. I read
once about the aging adherent of Trotsky, who said the proof of
the great leader's farsightedness was that none of his predictions
had come true yet. [laughter] Well, Julian's [predictions], just
like Warren's that we heard about, came true. He had a very high
batting average, a very high percentage. I expect that we'll be
seeing them come true in years yet to come.
Let me say a few words to you tonight about a mission that we have
taken on in this administration, a mission that attracted me, perhaps
more than any other, when my phone call came from the blue a year
ago December about the prospect of joining President Bush's administration.
And that is to reestablish, perhaps restore the good name, of regulatory
review in the American federal government. Think back with me, if
you will, to 1978, when a seven- or eight-year campaign ultimately
failed in its bid to create a Consumer Protection Agency for the
United States. Well thank goodness it did. Two years later, by Executive
Order, the organization we now know as OIRA got full authority to
become a central clearinghouse and review agency, a second opinion
source on major federal regulations, would-be regulations emanating
from the various departments of the federal government. And those
two otherwise unrelated events are linked in my mind because I would
assert, if done properly, regulatory review is consumer protection
in its purest form.
We know with some degree of precision that, conservatively estimated,
regulations on the books of federal government inflict 600 to eight
hundred billion dollars in cost to the American economy every year.
It's wrong to put it the way I just did, because such costs are
not inflicted on abstractions like economies, but on each of us,
on everyday citizens, with ultimately every dollar of that falling
on a purchaser of a good or service, either in a direct cost, or
the unavailability of that product or the loss of the freedom of
our choice consequent to some regulatory restriction.
So when I look at this job, this opportunity to scrutinize and rigorously
assess the value of regulations proposed being added to this very
large burden the American consumer now carries, I see it as a consumer
protection mission. And I see as central to performing that mission
that we define it that way and we not thoughtlessly abdicate the
moral high ground of consumer protection to the self-appointed.
Now, this said, markets work best when consumers are well-informed.
This is our opportunity to make sure that consumers understand what
they're getting for the dollar and the very real cost that they
are asked to bear. It's our job to make sure that if and when a
regulation does attain the force of law, that the consumer gets
a fair bargain, a square deal. Now, this is a very noble mission
in my job, in my estimation, but one that as we know is so very
easily distorted, or even impugned. My nominee for amusing headline
of the year -- as funny as it was unfair -- sort of captures this.
After years and years of careful study, exhaustive analysis, and
mountains of technical data, the Department of Energy, with my friend
Spencer Abraham as Secretary, announced the plans for disposal of
the nation's radioactive waste, in probably the safest place on
Earth, Yucca Mountain, Nevada. All of this learning, all of this
science, all of this economic analysis was distilled down by the
Reno paper into the memorable headline, "Abraham to Nevada:
Glow to Hell." [laughter]
So recognizing the potential for distortion and abuse, and interested
not in the emotional satisfaction of railing against all this, or
simply having pitched battles for the sake of public education --
that's what we have the Competitive Enterprise Institute for --
but interested rather in results, we are attempting to move swiftly
but carefully to establish public confidence in the consumer protection
mission of OMB.
I think there are about three simple steps that we have chosen to
take in order to try to make this happen. One is to conduct the
process of maximum openness. I think this is entirely appropriate
anyway. I think the public will draw confidence, and is entitled
to know that public decisions, in our area or others, are being
made in a fair process that is open to all. There's also a defensive
reason for this. Many people who are proponents of aggressive federal
action and intrusion and intervention and regulation have had a
lot of success in the past, without ever engaging them in the merits,
or debate on the merits of the issue at hand but simply by impeaching
the process. This happened I think very unfairly but with very real
consequences to Vice President Quayle's Competitiveness Council,
when it was made custodian of this responsibility, and to some of
Jim's [Tozzi] successors, and to some of my predecessors, at the
OMB/OIRA office of the day. If only to immunize the process against
such cheap shots, I have asked Dr. John Graham, our head of OIRA,
to run the most open process ever. I think friend and foe have so
far recognized it as such. If you come tomorrow morning to see John
or one of his people about a regulation under review, it will appear
on our web site by tomorrow night. We will tell the world you were
there and the subject of the discussion, and the world can judge
and have that information. I see this as a prerequisite to the sort
of credibility we seek for our decisions.
Likewise with technical excellence. I've mentioned Dr. John Graham.
I didn't know John Graham from Adam about a year and a half ago.
But I quickly discovered he was the man central casting would send
to match our description of the next OIRA leader: a person with
established credentials; one of the nation's leading decision scientists
with the Harvard School of Public Health; a person of personal integrity
to match his intellectual achievements. This did not stop him from
being a source of controversy. In this case, not because there was
any real case against him, but because people who favor an unfettered
regulatory regime, without second opinions, without meaningful review,
feared that he might elevate the standards and sharpen the tools
of such review, as in fact he is going to do. John is assembling
around him a first-rate staff. We will add resources and will insist
on greater talent than perhaps OIRA's ever had available before,
in order to ensure that the science and economics and technical
proficiency with which that job is done matches the seriousness
of the job, and are at the level in which the public can have confidence.
And then, finally, here we take our cue very literally from this
outstanding organization and from the two men whose names and whose
lives we celebrate tonight. We must learn to speak the vocabulary
of consumer protection every day in assuming our duty. This can
be as simple, but as important, as Warren Brookes taught us over
and over, as personalizing the cost and impact of regulations. Not
speaking about it simply in massive aggregates and abstractions
about cost to the economy and percents of GDP and so on. But how
much does it add to the cost of a house? How many fewer kinds of
football helmets will be available?
We must learn to look for the opportunities to discuss these matters
in more than economic terms. Many of the decisions we look at offer
the threat of unintended risk as well as unintended cost. So that
when John Graham and his team looked at a tire pressure rule recently,
there was every reason to believe, it turned out, that in addition
to extra cost for a car, that by deterring the use, the purchase
of disc brakes over time was to have less safety, not more. The
CAFE issue, which Fred made mention of, of course, is a classic
case of this risk that in pursuit, theoretically, of greater mileage,
cleaner air and so forth, we risk endangering Americans in less
safe cars.
Our outlook I suppose, could be summed up as 'Speak softly, but
carry a big yardstick.' And I think that Warren Brookes and Julian
Simon would have understood; each of them, on top of everything
else that was said, was a great translator, a great popularizer.
Simplifier, I don't suppose, is the term -- it doesn't do justice
to the work they did. But they did reduce, into plain English, into
meaningful examples, complex subjects so that a free citizenry could
make an informed judgment. We have to try to be pale imitations
or imitators of that matchless skill they had. We will look to CEI
-- our best current translator of jargon and complexity -- for the
language of everyday people, for examples we can all grasp, often
with flair and some which assure that their work will be paid attention
to, amidst the sea of information which we are all constantly swimming
against. And we hope to pursue this mission again, like Brookes
and Simon, with integrity -- integrity in the largest sense.
I close with another compliment to our host. In Indiana we say that
farmers tend to be capitalists on the way up and socialists on the
way down. I'm afraid this phrase may be becoming obsolete, I'm not
sure. [laughter and applause] The point I want to make is that CEI
follows fact and principle where it leads, as we must in our public
duties. What I have in mind here is that they are honest. There
are elements of the American enterprise system which are capitalist
on the way up, and socialist once they reach the top. And there
is a temptation, and a constant invitation, to find previously undiscovered
merit and virtue in regulations that serve as barriers to entry,
that serve as protectors of those who have achieved wealth and market
position or power. I have always admired CEI for never flinching
from pointing out those occasions on which perhaps potential patrons
even were falling prey to that temptation. This is a very, very
important element in our public debate. It's important that we have
people and independent organizations who maintain the integrity
and the clarity of thought and the backbone to declare that when
and where they see it. After all, the name of this organization
is the Competitive Enterprise Institute. To me, that speaks to the
fundamental supremacy of competition and competitive systems to
allow free people to exercise their God-given rights. It places
the consumer -- the individual citizen -- at the center of its mission,
not corporations, not those organizations that free people form,
but the ultimate end of a free society at the center of this operation.
Bless you for that, and for the supreme skill and honor with which
you perform that mission. You are our model, and in our way we'll
try to do likewise. Thank you very much.
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