- The Washington Times - Sunday, January 19, 2003

RISK AND REASON: SAFETY, LAW, AND THE ENVIRONMENT
By Cass Sunstein
Cambridge University Press, $30, 336 pages
REVIEWED BY ANGELA LOGOMASINI


"Experts are more likely to be right than are ordinary people," says Cass Sunstein in "Risk and Reason." Mr. Sunstein contends that, when it comes to comprehending risks, the public lacks good information and is biased toward the most alarming scenarios. Resulting policy expends limited resources on minute risks and misses opportunities to regulate larger ones.
We need to empower discerning minds to make decisions about risk policy, argues Mr. Sunstein. Employing objective tools such as cost-benefit analysis by experts supposedly would bring rationality to our regulatory process.
But Mr. Sunstein devotes little attention to already apparent problems of today's technocratic rule. Regulatory "experts" have their own ideological agendas and personal incentives just like most players in Washington. Their budgets are affected by the perceived importance of their programs, their careers advanced when they are working to prevent the next "crisis" of the day.
Political scientist Theodore Lowi convincingly illustrated problems with technocratic rule in his landmark 1979 book, "The End of Liberalism."According to Mr. Lowi, our liberal republic died when Congress began delegating lawmaking authorities to the unelected "experts" in the bureaucracy. The result is a perverted form of republican government in which policymaking has become nothing more than bargaining between special-interest groups and bureaucrats.Our elected representatives merely intervene on behalf of select constituents, blaming the bureaucracy for problems, while disavowing any responsibility for creating it.
Sound science and valid cost-benefit analysis have become politicized and often are manipulated by the experts to serve their own career pursuits and meet political pressures.
Consider the process the Environmental Protection Agency recently employed to set a new drinking water standard for arsenic. Mr. Sunstein highlights what he and many considered a key piece of "expert evidence" supporting a more stringent standard. But a better description of this "evidence" is politically contrived junk science.
Mr. Sunstein claims that the National Research Council (NRC) study on arsenic found that the existing standard at the time presents a 1-100 cancer risk.But this figure is nothing more than conjecture. It was tossed out speculatively in a chapter of the NRC report analyzing various statistical methods for assessing risk. The report did not run any risk assessment model to produce this conclusion.
Within this same chapter, the NRC panel urged EPA not to use the findings for assessing risk of arsenic because there were serious problems with the data. The panel explained that the chapter was simply offered to illustrate how the models worked.
But any truly wise expert would have known that putting the number in the report could have vast political implications, which, in fact, it did. EPA officials, politicians, major media outlets, and environmental activists all cited it to support imposition of a more stringent regulation.
One must question Mr. Sunstein's assumption that experts necessarily have better information than the public. How could they comprehend the myriad effects of national regulations on tens of thousands of localities, each with its own needs and circumstances? F.A. Hayek rightly dubs this assumption a "fatal conceit."
All this is not to say that tools like cost-benefit analysis don't have a role in the policymaking process. But we need to keep it in perspective. It's one of many arrows with which to pierce the regulatory giant, and it is not a silver bullet.
Mr. Sunstein does offer many valuable insights on the public's understanding of risk and its implications. However, he goes too far in suggesting that the public is largely incapable of making wise decisions about risk. At the same time, the author does show that, under the right circumstances, the public does act rationally. He offers an example of what happened when the New York City government proposed to remove asbestos from schools.The idea was popular among the public until parents learned the costs: Schools would be closed for weeks and working parents would have to find daycare. Suddenly, parents acted like the experts, says Mr. Sunstein. They were willing to see that action wasn't necessary because risks were statistically small.
This example demonstrates a key point. When decisions are local and impact is direct, the public has good information and is apt to make more reasonable decisions. Hence, the problem is not that the public can't act rationally, it's that decisions and their impacts are too far removed.
Therefore, a better policy prescription than empowering the experts would be a return to American tradition of federalism.The more we move to a centralized system in which the "experts" make decisions for us, the more irrational policy will become.

Angela Logomasini is director or risk and environmental policy at the Competitive Enterprise Institute.



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