Saturday, 29 November 2008

Ministry of standards

Governments involve themselves in much of public life. It is reasonable to think that at least some involvement is excessive. Many would argue that most involvement is excessive. Of all the portfolios that governments have, there is one that I think should exist of its own accord.

We should have a Ministry of Standards.

Now we do have laws related to these issues, but I think the issue is important enough to warrant its own department with various divisions.

By standards I mean
  • defining various standards;
  • ensuring they are appropriate;
  • enforcing their use; and
  • prescribing punishments for breaches
Given that I prefer minimal government this may appear intrusive, but I see it as an issue of justice, and justice is an important role of government.

Defining standards

It is important to understand that I mean standards which are defined not prescribed. I do not think the government should enforce what manufactures should do, rather describe accurately what they in fact do. Granted there may be safety issues that mean minimum standards must be met in some areas, but by and large I think people should be able to exchange what they wish to do so. People should be able to buy products of varying quality.

Quality often relates to price. For any given object, desired price and quality vary among consumers. Some want high quality, others want low price. Most want high quality and low cost, but decisions are made at the margins. Government does not have a role in specifying a minimum standard (usually). Such a policy limits people, especially the poor who may not be able to afford such high quality items.

I do however think the government can have a role in ensuring that such items are of the claimed quality, and further, the government can have a role in specifying what must be shown on items for sale.

Examples include weights and volumes for foodstuffs, measurement dials in vehicles, breaking force and insulation property of glass, and electricity meters. Much of which is already covered by law.

Ensuring appropriateness

Consumers have the benefit of taking their custom where they will. Manufactures have the benefit in knowing exactly the quality of their product. Few consumers have the knowledge or ability to assess quality to this degree. Manufacturers may advertise various benefits of their product which is fine, but this should not be used to remove focus from more important quality issues that may not be mentioned.

Consider digital cameras. The quality of a photo is determined by several things including resolution. For people who print photos 6 megapixels is probably adequate. Now manufacturers can produce cameras of higher density such as 9 megapixels and they should be free to do so. This is good for larger photos, for cropping photos, and for digital zoom. The problem is that people may assume that the number of pixels reflects the quality of the photo because of the way cameras are marketed; but other factors are important such as the depth per pixel, speed of shot, stability of image capture, and software manipulation. So one may spend the extra money gaining extra pixels with no gain in printed product, and possibly worse if the pictures are blurred. He would be better spending the extra money on a camera that shoots more stable pictures at a lower resolution.

Defining standards of measures that affect photo quality that must be displayed on the product makes people aware of the issues, it lets them choose what they think best, and makes it harder for manufacturers to make cheap improvements and market the product as significantly superior.

Enforcing use

This is legislation that makes certain labelling compulsory and allows for the government to fund random testing to ensure compliance. Not compliance to some artificial mandate, rather accuracy of labelling. I am not concerned whether a product contains 1% or 20% sugar, just that one can trust the label.

Dealing with non-compliance

I think there is a role for this ministry to define the level of fines for breaches. The relationship between consumer and manufacturer is asymmetrical. Fortunately manufacturers are quite responsive to consumers for the sake of their brand name. However they may not be, especially in areas that may not have significant repeat service such as car and house sales. When organisations are blatantly and knowingly passing off a false product it is unduly onerous to expect a duped consumer to take up this cause. It costs them time, time that may be intentionally delayed by a company; money they may not have; and even if they were to win in court they may still be out of pocket and time and the company may be inadequately fined nor forced to significantly change their practice. Government enforcement is probably preferable.

I do not see this as applying to legitimate disputes, nor should it remove the ability for a consumer to act if they deem it necessary.

Nor am I anti-industry. I think some people make frivolous claims. Frivolity should be dealt with by claim dismissal and fining if necessary (paying the appropriate costs of all sides at minimum). Further, many companies care about both their employees and their customer base; they are what keep them in business.

Some caveats

  • As mentioned above, I don't see the governments role as setting what standards a product should have, just what standards it should measured by and making those easily accessible, preferably displayed on the product. Of course the company can include any other benefits it wishes to, so long those claims are accurate.
  • If the government wishes to set minimum standards, e.g. seatbelt positioning and engagement, then this is the role of a different department. It is very important the roles are not confused and that excessive red tape is not created.
  • I do not think the compliance costs should be high. It is reasonable to measure the macro- and micro-constituents of foodstuffs as this is a one-off cost. Incorporating the data into a label is not that costly either. But requiring a car company to carry out extensive crash testing would be an excessive cost. Car companies remain free to do this of their own volition and many large car companies do this anyway. And the government is free to carry out this testing (though at whose cost?).
  • I am not certain whether the government should enforce standards that are measured by a group not of the manufacturer's choosing. It is their product, they should have some say. Though if it is a sensible and well defined standard then the result should be the same whoever tests.
  • Protecting vulnerable people from predators and the public from scams are important issues, but may come under a slightly different aegis. Possibly a division within the "standards" umbrella, probably within a policing portfolio.
  • I think monetary policy and inflation comes under the definition of standards, but the issue of monetary standards is large enough to have a separate division within a Ministry of Standards.

Current law

I am aware that much of this is already in legislation. I do not mean to imply that this is not done. I just think it important enough for citizens that it is reasonable for the state to involve itself. It is after all an issue of justice, and justice is one of the few mandates of the state.

More to follow.

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