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Compliance
I've been hearing sentiment of late that the actual reason for the existence of regulatory compliance is because it's a jobs program for people who went and got fancy college degrees and need office jobs that require those fancy college degrees. Which I initially dismissed as Musa al-Gharbi being Musa al-Gharbi--like, I was going to post about it at some point, but I was waiting for Those People to come out to see if he said anything relevant in there--except this sentiment was also mentioned by How Money Works Uncut in their video about why people are unemployable now, and if this is beginning to get around then I have Thoughts.
Now, I do work in a field that requires a fair amount of regulatory compliance. I like to think this gives me useful perspective; I suspect these people would say that makes me biased and unreliable. I am, however, not actually coming here to argue that all compliance is Good and Necessary.
But some of it really, really is.
I would like to put forth four categories of regulations with associated compliance requirements: written in blood, necessary but not immediately going to kill anyone, obstructive, and well-meaning but inefficiently implemented.
"Your regulations are written in blood" is what's said to those who roll their eyes at regulations like "No storing toxic materials in the place where your container ship crew sleeps." Some of these regulations sound they shouldn't need to be a regulation on the face of it because who would ever do that in the first place, but they exist because someone did that and people died. These are the regulations where not following them will lead to immediate risks of death, injury, or major property damage, or where something happening unchecked will definitively cause long-term risks of something like cancer or serious environmental degradation--chemical dumping, smog, and the fact that America for the most part avoided thalidomide problems (there were something like 17 problem cases caused by unapproved samples) because a regulator kept saying "no, you need to prove this is safe" in the face of attempts to get her fired. (If you're not familiar with thalidomide, it was not, in fact, safe and it caused massive birth defects in every country that permitted it.)
This category needs to exist. This category arguably needs to be larger. It needs to be better enforced and far more detailed. Compliance here is about preventing deaths, understanding that the corporate entities it's restraining will not avoid doing this stuff unless something is providing prior restraint; the market and the court of public opinion won't stop them. If anything the market will encourage them to harm people for short-term profit. Many of the consequences of these things are hard to trace back and prove (see all the lawsuits over cancer clusters) and corporations will always have more money for defending lawsuits than the injured have to bring these lawsuits. Corporations also make more money than they fear losing in judgments. (Look at Oxycontin; they made way more off it than they had to pay in the resulting lawsuit. They came out ahead.) There's no effective way to prevent deaths with this stuff other than detailed restraining-bolt mandated behaviors with severe punishments should they deviate from those behaviors. Compliance regimes are 100% necessary here.
"Necessary but not immediately going to kill anyone" is mostly financial crime and other restraints on corporate behavior. The "will eventually indirectly kill people or cause serious harm to quality of life if left unchecked" stuff. Things like antitrust and market manipulation and landlord regulation. Things like mandating certain behaviors as a consequence of fiduciary responsibility. The reasoning here is essentially the same as the "written in blood" category, in some ways more so since the injuries are less obviously connected to the actions. Financial institutions have proven within recent memory that they can't be counted on to behave themselves in a loosened regulatory regime or even obey the regulations that exist without someone proactively restraining them, and they cause economic disaster that spills over onto everyone else when they misbehave. Regulatory compliance here is how you prevent them wandering off and breaking regulations with no one the wiser until after it's caused an economic meltdown. This is another one where the compliance infrastructure is actually insufficient; these places should have a lot more compliance requirements and a lot more enforcement.
The third category is more interesting. What I'm classifying as "obstructive" is stuff like not being able to buy soda with SNAP or overly complex application procedures in the name of fraud prevention. Fraud does exist and you do need to monitor for it, but there are ways to monitor for it that are less intrusive. SNAP manages to have a pretty streamlined application process while also limiting fraud; I think we could extend that to other benefits programs. But these regulations aren't about preventing fraud, and they're not about creating jobs either--the job creation is a side effect of the goal. They're about preventing people from getting benefits at all, often for ideological reasons, or using regulations to punish and control people getting benefits, always for ideological reasons. Compliance for programs with obstructive regulations generally doesn't pay well (as I said, the job creation is a side effect, and deliberately not providing enough funding for a sufficient number of staff is another way to keep people from getting benefits), and depending on what organization you're working for and specific job category, may not require a degree. When they do require a degree, it's a specific degree. (I can't use education as a qualifier for state jobs in this area despite having both a BA and an MLIS; neither of them are degrees in business or public administration. At this point I have have enough general compliance/administration experience that I could use it to substitute for a degree if I wanted one of those jobs, but my degrees would be ignored in that hiring process.)
And if you're about to talk about the prestige of it all, these jobs are not, socially speaking, looked on that differently from any other customer service job. Nor is the day-to-day substantially different from any other customer service job, just with the somewhat better job security that comes with any public sector job. (There's a term that was coined in library science academia, "vocational awe," used to describe jobs where you are expected to put up with low pay and terrible working conditions because they are A Calling and create great social prestige because you are Shaping People's Lives. Jobs like teachers and librarians and social workers. I assure you "regulatory program compliance person" is not one of these jobs.)
The other half of this category is NIMBY stuff, where the regulations are a deliberate excuse to keep building projects from happening at all. Again, this is not using compliance as a jobs program; this is using compliance as a weapon. This mostly does not create jobs because people on the wrong end of it know what the goal is, know that if they try to wind their way through the compliance new regulations will be hurried into place, and don't bother trying.
Last category is the well-meaning but inefficiently implemented, and this one actually does create jobs that wouldn't exist in a more functional world. This category is a mix of "perfect is the enemy of the good" and "going after actual problems is hard; let's ban straws," and the existence of that second bit has caused a lot of people to get the wrong idea about the first bit.
These can masquerade as any of the other categories, and it's also very easy to tar the "misplaced seeking perfection" ones with the brush of the "banning straws" ones. (The McDonald's coffee lawsuit got tarred as silly but she had serious injuries requiring surgery and they'd previously ignored orders to stop serving their coffee that hot. Some sort of spot-inspection regime enforcing reasonable coffee temperatures would at that point be warranted.) It is possible to have an outcome that needs to happen while the process that supposedly exists to achieve that outcome is not helping or is actively hindering it. Every process across every industry should be regularly scrutinized to ensure it's accomplishing what it's supposed to be accomplishing and that it's not overly hindering outcomes. It's just important to bear in mind that some of the ones that sound very silly (gluten-free ham) exist for very real, very important reasons that are not immediately obvious (so that the people who are so sensitive that even the most minute cross-contamination is a problem can eat your ham knowing care was taken to avoid that) and/or because someone actually tried to do something with unfortunate consequences and you need something there preventing people trying again in the future, even if what's currently there might not be the best way of accomplishing that. You need to ask "why does this regulation exist?" and really listen to the answer before you can suggest it's not necessary.
The thing is, for the jobs-program aspect of it all, if there was political will there you wouldn't actually need to lose jobs to fix this. There's a fair bit of skills transfer between compliance jobs as a whole. Yes, there's always a need for industry-specific training, but "needs a formal degree or scientific training or specialized accounting training" is not going to be the case for every job in the first two categories, and they're woefully underenforced. Step up enforcement in the first two categories, hire a zillion inspectors thus forcing the organizations under that enforcement to hire a bunch of compliance professionals to ensure those audits come out clean, create a few training programs for the newly-created critical compliance positions that *do* require specialized training, and when you streamline categories three and four you haven't lost any jobs at all.
Of course, that's much less snappy than saying that compliance work is a jobs program, so I don't expect any of these people to listen to me.
Now, I do work in a field that requires a fair amount of regulatory compliance. I like to think this gives me useful perspective; I suspect these people would say that makes me biased and unreliable. I am, however, not actually coming here to argue that all compliance is Good and Necessary.
But some of it really, really is.
I would like to put forth four categories of regulations with associated compliance requirements: written in blood, necessary but not immediately going to kill anyone, obstructive, and well-meaning but inefficiently implemented.
"Your regulations are written in blood" is what's said to those who roll their eyes at regulations like "No storing toxic materials in the place where your container ship crew sleeps." Some of these regulations sound they shouldn't need to be a regulation on the face of it because who would ever do that in the first place, but they exist because someone did that and people died. These are the regulations where not following them will lead to immediate risks of death, injury, or major property damage, or where something happening unchecked will definitively cause long-term risks of something like cancer or serious environmental degradation--chemical dumping, smog, and the fact that America for the most part avoided thalidomide problems (there were something like 17 problem cases caused by unapproved samples) because a regulator kept saying "no, you need to prove this is safe" in the face of attempts to get her fired. (If you're not familiar with thalidomide, it was not, in fact, safe and it caused massive birth defects in every country that permitted it.)
This category needs to exist. This category arguably needs to be larger. It needs to be better enforced and far more detailed. Compliance here is about preventing deaths, understanding that the corporate entities it's restraining will not avoid doing this stuff unless something is providing prior restraint; the market and the court of public opinion won't stop them. If anything the market will encourage them to harm people for short-term profit. Many of the consequences of these things are hard to trace back and prove (see all the lawsuits over cancer clusters) and corporations will always have more money for defending lawsuits than the injured have to bring these lawsuits. Corporations also make more money than they fear losing in judgments. (Look at Oxycontin; they made way more off it than they had to pay in the resulting lawsuit. They came out ahead.) There's no effective way to prevent deaths with this stuff other than detailed restraining-bolt mandated behaviors with severe punishments should they deviate from those behaviors. Compliance regimes are 100% necessary here.
"Necessary but not immediately going to kill anyone" is mostly financial crime and other restraints on corporate behavior. The "will eventually indirectly kill people or cause serious harm to quality of life if left unchecked" stuff. Things like antitrust and market manipulation and landlord regulation. Things like mandating certain behaviors as a consequence of fiduciary responsibility. The reasoning here is essentially the same as the "written in blood" category, in some ways more so since the injuries are less obviously connected to the actions. Financial institutions have proven within recent memory that they can't be counted on to behave themselves in a loosened regulatory regime or even obey the regulations that exist without someone proactively restraining them, and they cause economic disaster that spills over onto everyone else when they misbehave. Regulatory compliance here is how you prevent them wandering off and breaking regulations with no one the wiser until after it's caused an economic meltdown. This is another one where the compliance infrastructure is actually insufficient; these places should have a lot more compliance requirements and a lot more enforcement.
The third category is more interesting. What I'm classifying as "obstructive" is stuff like not being able to buy soda with SNAP or overly complex application procedures in the name of fraud prevention. Fraud does exist and you do need to monitor for it, but there are ways to monitor for it that are less intrusive. SNAP manages to have a pretty streamlined application process while also limiting fraud; I think we could extend that to other benefits programs. But these regulations aren't about preventing fraud, and they're not about creating jobs either--the job creation is a side effect of the goal. They're about preventing people from getting benefits at all, often for ideological reasons, or using regulations to punish and control people getting benefits, always for ideological reasons. Compliance for programs with obstructive regulations generally doesn't pay well (as I said, the job creation is a side effect, and deliberately not providing enough funding for a sufficient number of staff is another way to keep people from getting benefits), and depending on what organization you're working for and specific job category, may not require a degree. When they do require a degree, it's a specific degree. (I can't use education as a qualifier for state jobs in this area despite having both a BA and an MLIS; neither of them are degrees in business or public administration. At this point I have have enough general compliance/administration experience that I could use it to substitute for a degree if I wanted one of those jobs, but my degrees would be ignored in that hiring process.)
And if you're about to talk about the prestige of it all, these jobs are not, socially speaking, looked on that differently from any other customer service job. Nor is the day-to-day substantially different from any other customer service job, just with the somewhat better job security that comes with any public sector job. (There's a term that was coined in library science academia, "vocational awe," used to describe jobs where you are expected to put up with low pay and terrible working conditions because they are A Calling and create great social prestige because you are Shaping People's Lives. Jobs like teachers and librarians and social workers. I assure you "regulatory program compliance person" is not one of these jobs.)
The other half of this category is NIMBY stuff, where the regulations are a deliberate excuse to keep building projects from happening at all. Again, this is not using compliance as a jobs program; this is using compliance as a weapon. This mostly does not create jobs because people on the wrong end of it know what the goal is, know that if they try to wind their way through the compliance new regulations will be hurried into place, and don't bother trying.
Last category is the well-meaning but inefficiently implemented, and this one actually does create jobs that wouldn't exist in a more functional world. This category is a mix of "perfect is the enemy of the good" and "going after actual problems is hard; let's ban straws," and the existence of that second bit has caused a lot of people to get the wrong idea about the first bit.
These can masquerade as any of the other categories, and it's also very easy to tar the "misplaced seeking perfection" ones with the brush of the "banning straws" ones. (The McDonald's coffee lawsuit got tarred as silly but she had serious injuries requiring surgery and they'd previously ignored orders to stop serving their coffee that hot. Some sort of spot-inspection regime enforcing reasonable coffee temperatures would at that point be warranted.) It is possible to have an outcome that needs to happen while the process that supposedly exists to achieve that outcome is not helping or is actively hindering it. Every process across every industry should be regularly scrutinized to ensure it's accomplishing what it's supposed to be accomplishing and that it's not overly hindering outcomes. It's just important to bear in mind that some of the ones that sound very silly (gluten-free ham) exist for very real, very important reasons that are not immediately obvious (so that the people who are so sensitive that even the most minute cross-contamination is a problem can eat your ham knowing care was taken to avoid that) and/or because someone actually tried to do something with unfortunate consequences and you need something there preventing people trying again in the future, even if what's currently there might not be the best way of accomplishing that. You need to ask "why does this regulation exist?" and really listen to the answer before you can suggest it's not necessary.
The thing is, for the jobs-program aspect of it all, if there was political will there you wouldn't actually need to lose jobs to fix this. There's a fair bit of skills transfer between compliance jobs as a whole. Yes, there's always a need for industry-specific training, but "needs a formal degree or scientific training or specialized accounting training" is not going to be the case for every job in the first two categories, and they're woefully underenforced. Step up enforcement in the first two categories, hire a zillion inspectors thus forcing the organizations under that enforcement to hire a bunch of compliance professionals to ensure those audits come out clean, create a few training programs for the newly-created critical compliance positions that *do* require specialized training, and when you streamline categories three and four you haven't lost any jobs at all.
Of course, that's much less snappy than saying that compliance work is a jobs program, so I don't expect any of these people to listen to me.
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