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
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
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
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
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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