12 April 2005 erasmuse@indiana.edu, G406, chapter 19

TOPICS LAST TIME

1. Workmen's compensation schedule

2. Workers in Iraq

3. Diagram for why employers don't like unsafe workplaces. Competition and Monopsony.

4. Few inspections by OSHA. Pp. 782-784.

5. Figure 23.4. -- when OSHA has no effect.

THE POLICE POWER

"Police power" is the governing authority's ability to legislate for the protection of the citizens' lives, health, and property, and to preserve good order and public morals...

Powell v. State, 510 S.E.2d 18 (Ga. 1998) at 25 (citing Commonwealth v. Bonadio, 415 A.2d 47, 49-50 (Pa. 1980)).

 

 

In Samuel Williston's classic formulation, the police power may be used for "safety, health, morals and the general welfare of the public."

Samuel Williston, Freedom of Contract, 6 Cornell L. Q. 365, 375- 76 (1921).

Citizen Miscerceptions

"An interesting policy question is how the government should respond, if at all, to public misperceptions.

Suppose, for example, that the public greatly overestimates the risks associated with hazardous waste sites.

Should the government respond to these fears because, presumably, in a democratic society the government action should reflect the interest of the citizenry?

p. 646

THE ELLSBERG PARADOX

Urn 1 contains 50 red balls and 50 white balls.

Urn 2 contains a unknown mixture of red and white balls.

You win $10 if you guess which ball will be drawn out.

What should you do?

 

Now you must bet on white.

Urn 10 contains 51 red balls and 49 white balls.

Urn 11 contains a unknown mixture of red and white balls.

What should you do?

 

Again you must bet on white.

Urn 10 contains 51 red balls and 49 white balls.

Urn 11 will be randomly drawn to be either Urn 11a, which contains 80% red balls, or Urn 11b, which contains 80% white balls.

What should you do?

TV and Film Industry Wins Waiver on Truck-Safety Rules (WSJ)

A little-noticed provision in the $820 billion government spending bill that cleared Congress last week prohibits federal highway-safety regulators from enforcing new truck-safety regulations on commercial drivers who work in the film and television industry.

The so-called hours-of-service regulations, ... are intended to reduce highway accidents involving tired truckers by extending the length of time truck drivers must rest between shifts to 10 hours, from eight.

The Federal Motor Carrier Safety Administration estimates the rules will save 75 lives a year, prevent 1,326 fatigue-related injuries, and prevent 6,900 property damage- only crashes, resulting in annual savings of some $628 million.

under a 100-word provision buried deep inside the bill, the agency is effectively barred from enforcing the regulations on "drivers engaged in the transportation of property or passengers to or from a motion picture or television production site located within a 100-air mile radius of the work reporting location of such drivers."

Critics said the provision was crafted in secrecy and would encourage other industries to seek similar exemptions.

A spokesman for Sen. Dianne Feinstein (D., Calif.) said the senator sponsored the provision and that the TV and film industry's drivers typically drive less than 100 miles a day, often resting at the production sites. "We do not feel this would compromise safety," the spokesman said.

The price of discrimination: set-asides may die soon, now that officials are being held liable (Weekly Standard, Dec 27, 2004)

On November 10, the governing board of the South Florida Water Management District ($792 million budget) recommended ending its two-decade-old contracting preference program, even though there was no pending litigation. Board members had become worried about being held personally liable for implementing the program.

The case that got the board's attention is Hershell Gill Consulting Engineers v. Miami-Dade County.

Gill is a small firm with fewer than a dozen employees earning about $1 million annually. While most of its work is in the private sector, the company wanted the opportunity to contract with Dade County. However, Gill Engineering is owned by a white male, and the county required that at least 42 percent of the dollars awarded in architecture and engineering contracts go to blacks, Hispanics, and women.

By 1998, the county manager and the county attorney's office recommended that preferences be abandoned in architecture and engineering contracts because "parity" for the favored groups had been reached.

Because of Florida's sunshine laws this recommendation was broadcast on cable television.

The county commissioners, however, twice rejected the recommendation and refused to modify the program.

The county commissioners, however, twice rejected the recommendation and refused to modify the program.

The commissioners then decided they needed a new consultant's study to justify the policy they wanted to preserve. ... So a new study was churned out .... This study was so badly flawed that its author admitted at trial, "We do have some problems in the data." As Judge Adalberto Jordan wryly concluded, that admission, "in my view, is a vast understatement."

Worse than the data deficiencies, the court concluded, was the fact that the study "fails to identify who is engaging in the discrimination, what form the discrimination might take, at what stage in the process it is taking place, or how the discrimination is accomplished."

Consequently the court issued an order in 2000 ending the county's racial and gender preferences in architecture and engineering contracts.

But other county preferences remained, and the plaintiffs asked the court to hold the commissioners personally liable for their persistent willingness to discriminate against white-owned firms.

At key moments during the civil rights movement, the threat of personal liability was used to force school boards and voting registrars to quit discriminating. Now a court was being asked to use the same tool when the victims were white.

... Judge Jordan ... finding that the commissioners could not be held liable for enacting an unconstitutional program, but that in their role as approvers of individual contracts the commissioners were taking on an administrative role.

"The Commissioners are not entitled to qualified immunity and are liable for any compensatory and punitive damages in their individual capacities," the judge held.

The court was no doubt influenced by the undisguised spoils system it found in Dade County.

A majority of the commissioners are Hispanic. "It is probably not happenstance," the court concluded, "that Hispanics receive the highest" set- aside: 25 percent. Women are a majority of the county's population and come close to forming a majority on the commission. "Again, not surprisingly," the judge declared, "women have the second-highest" goal. Blacks represent a minority on the commission; "not coincidentally, they get the lowest" goal, 12 percent. Only one member of the county commission was a white male and, of course, no goals were established for the benefit of companies owned by white males.

Judge Jordan warned that in the future, if preferences were used and the record were as deficient as it was in Gill, the "consequences will be severe" and "punitive damages will be a virtual certainty."

"Career Journal: More Employers Ask Job Seekers For SAT Scores" (28 October 2003, WSJ)

DONNA CHAN IS 23 years old and has been out of college since May 2002, when she graduated from Wagner College on New York's Staten Island. So should anyone care how she did way back in high school on her SATs?

Since Ms. Chan started looking for an entry-level job in financial services more than a year ago, she has repeatedly stumbled over a common requirement for many of these positions: a combined SAT score of at least 1300 out of a maximum 1600. Ms. Chan's combined score on the math and verbal tests fell "somewhere in the 1200s," even though she earned a 3.9 grade-point average in college while getting a degree in computer science with a minor in math.

A number of ads placed by recruiters and staffing firms set clear SAT goals. Consider this recent ad on HotJobs.com for an entry-level, investment-banking position: "Minimum expectations include an overall score of 1350 on the SATs. . . . You will be required to provide official scores and transcripts, so please do not respond if you do not meet the aforementioned requirements."

Alan Sage, a vice president at Configuresoft Inc., a Woodland Park, Colo., systems-management software company, says he routinely asks applicants to submit their SAT scores when they apply for sales jobs. He says he picked up the practice from a former employer of his who wanted applicants to have no less than a combined SAT score of 1400.

Mr. Sage sets his bar somewhat lower, at 1200,

While Mr. Sage says he has always asked to see SAT scores, he admits that he was far more flexible when Configuresoft was first launched in the boom days of 1999. With his sales team experiencing lots of turnover, he says, he had to "beg marginal people" to come work for the company.

Mr. Sage says he also places the SAT requirement in ads to see whether applicants are paying attention to details. When he placed an ad for an account- manager position on an online job board earlier this month, he received hundreds of resumes. But fewer than 10% of respondents bothered to include their scores. Those who did, he adds, scored at least a 1200.