Rules and More Rules

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Another month, another terrible and bizarre aircraft incident.

As far as the media are reporting, Andreas Lubitz decided it would be a great idea to fly a fully functional A320 in to the side of a mountain and kill 150 people a few days ago.

Six months ago a fully functioning 777 was flown in to the sea wall at SFO.

A year ago a fully functioning 777 made some interesting maneuvers and disappeared in the South Indian Ocean with 239 people on board.

Aircraft are an interesting set of examples because they’re so well studied and corrected. We don’t spend time correcting hospital mistakes with nearly the speed and detail we do aircraft accidents, for example. [..] As we find more rules to fix more things we are encountering tail events. We fixed all the main reasons aircraft crash a long time ago. Sometimes a long, long time ago. So, we are left with the less and less probable events.

We invented the checklist. That alone probably fixed 80% of fatalities in aircraft. We’ve been hammering away at the remaining 20% for 50 years or so by creating more and more rules.

We’ve reached the end of the useful life of that strategy and have hit severely diminishing returns. As illustration, we created rules to make sure people can’t get in to cockpits to kill the pilots and fly the plane in to buildings. That looked like a good rule. But, it’s created the downside that pilots can now lock out their colleagues and fly it in to a mountain instead.

It used to be that rules really helped. Checklists on average were extremely helpful and have saved possibly millions of lives. But with aircraft we’ve reached the point where rules may backfire, like locking cockpit doors. We don’t know how many people have been saved without locking doors since we can’t go back in time and run the experiment again. But we do know we’ve lost 150 people with them.

And so we add more rules, like requiring two people in the cockpit from now on. Who knows what the mental capacity is of the flight attendant that’s now allowed in there with one pilot, or what their motives are. At some point, if we wait long enough, a flight attendant is going to take over an airplane having only to incapacitate one, not two, pilots. And so we’ll add more rules about the type of flight attendant allowed in the cockpit and on and on. [..] This is a clean and understandable example of why adding more layers, and more rules, to a problem doesn’t always work. If you stop at some level then you’re missing out on the ultimate solution. [..]

Similarly the US Constitution, as a set of rules, fixed most problems with government. That document alone probably fixed 80%+ of governmental problems and now we’re reduced to rules making it illegal to be a hairdresser without a government license, or whatever.

Weirder

And so, with more rules we have solved most of the problems in the world. That just leaves the weird events left like disappearing 777’s, freak storms and ISIS. It used to be that even minor storms would be a problem but we have building codes now (rules). Free of rules, we’d probably have dealt with ISIS by now too.

Ultimately, this is why the world is getting weirder, and will continue to do so. Now with global media you get to hear about it all.

What to do?

The primary way we as a society deal with this mess is by creating rule-free zones. Free trade zones for economics. Black budgets for military. The internet for intellectual property. Testing areas for drones. Then after all the objectors have died off, integrate the new things in to society.

The worry should be we end up with so many rules we become sclerotic like Italy or France. We effectively end up with some kind of Napoleonic law – everything is illegal unless specifically made legal. Luckily we’re far from that in the US.

On a personal level we should probably work in areas where there are few rules.

To paraphrase Peter Thiel, new technology is probably so fertile and productive simply because there are so few rules. It’s essentially illegal for you to build anything physical these days from a toothbrush (FDA regulates that) to a skyscraper, but there’s zero restriction on creating a website. Hence, that’s where all the value is today.

If we can measure economic value as a function of transactional volume (the velocity of money for example), which appears reasonable, then fewer rules will mean more volume, which means better economics for everyone. So it used to be very hard to create an airline, now it’s easy, we have more choice and more flights and so on.

Rules stop you making transactions (monetary or otherwise). With fewer transactions we have a lower flow of value from where it is, to where it’s best usable.

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A lot of the problems are the result of rules that are around industrial age constructs that are ill-suited for today. Why are pilots the only ones deciding about an emergency? More than half the vote of passengers should be able to kick-in auto-pilot that’ll fly a plane until control tower lands it remotely or by the auto-pilot itself. More people in the decision making process, more automation. Less concentration, less specialization.

There are bunch of rules round central banks, regular banks, what Presidents can do, cannot do. You fuck up one, such as lifting of Glass-Seagall, a financial crises goes from bad to worse. Or adding a new one that brings the economy to a stand-still. Oh maybe we should not have had that rule… Or had it, but in a different context. Maybe? These are, in the final analysis, superfluous arguments…What needs to be questioned is that if we really truly need banks, central banks or Presidents. It is not the rules around the old constructs that are good or bad per se, it is their mere existence that is causing the problem because they are part of a system that cannot be made to work efficiently with any kind of rule.

(We are hopeful of course a good President can change the system s/he is in; basically taking a step in a brand new direction. But this person needs to be truly transformative. We will see)

Speed: Yes life is moving much faster, Toffler studied this in Future Shock. Knowledge-based economy tends to move fast because, well, it can. Then changes collide with existing set of rules causing headache. Changes themselves coupled with this collision creates stress because human brain processes differences / changes, with increase of such stimuli (everything changes) this causes psychological ailments, stress, or worse.

Obviously all rules that that conflict with optimality need to go. As for the change itself an increase of social help will makes things better. But this help must be simple, tied to individual, and portable, without any additional rules.