Capitalisn’t: Science for Sale
- October 05, 2023
- CBR - Capitalisnt
In his book The Triumph of Doubt: Dark Money and the Science of Deception, George Washington University’s David Michaels shows how corporate interests often “manufacture uncertainty” in order to protect their profits. Using wide-ranging case studies from Big Tobacco, Volkswagen, American football, and talcum-based baby powder, Michaels exposes the disinformation playbook deployed by corporate-funded science to sow “doubt, denial, delay, distraction, deflection, and defense.” He joins Capitalisn’t hosts Bethany McLean and Luigi Zingales to discuss how we can fight back against manipulated science and replace the triumph of doubt with the triumph of truth.
David Michaels: We have to have systems where unconflicted experts examine the data because if you have a financial relationship with companies, whether it’s football, whether it’s a chemical, whether it’s alcohol, I think there’s a lot of evidence that you can’t see what is obviously there and can be seen by people who are unconflicted.
Bethany: I’m Bethany McLean.
Phil Donahue: Did you ever have a moment of doubt about capitalism and whether greed’s a good idea?
Luigi: And I’m Luigi Zingales.
Bernie Sanders: We have socialism for the very rich, rugged individualism for the poor.
Bethany: And this is Capitalisn’t, a podcast about what is working in capitalism.
Milton Friedman: First of all, tell me, is there some society you know that doesn’t run on greed?
Luigi: And, most importantly, what isn’t.
Warren Buffett: We ought to do better by the people that get left behind. I don’t think we should kill the capitalist system in the process.
Bethany: Let’s be clear, we’re not against capitalism. If we focus mostly on what’s not working, it’s because we want to try to fix it. One of our common interests is corporate governance, a fancy term that can be simply explained as how to prevent companies from behaving badly.
Luigi: This explains our obsession with scandals, fraud, and any major screw-ups. We want to know what we can do to stop them, or at least minimize them. Capitalism is not a predetermined machine but a system of incentives that shape people’s behavior. Does capitalism fail because its incentives are too strong, not strong enough, or because they’ve not adapted to the complexity of the modern world?
Bethany: We decided to dedicate two episodes to at least some of the enablers, the professionals who are hired to help corporations escape the consequences of their actions. Today’s episode is closer to Luigi’s world, the world of scientific experts for hire. The next episode will be dedicated to the world of lawyers for hire.
Luigi: We are missing the journalists. We’re going to have to dedicate an episode to them.
Bethany: That’s fair.
Luigi: And we already have an episode on the consultants, who are more in my camp, and people can listen to our episode on McKinsey Consulting, and it could be part of the series, even if it was not thought of in these terms.
But to help our discussion today, we decided to bring in a real scientist who is critical of how scientists behave. His name is David Michaels, whose recent book, The Triumph of Doubt, argues that far too often what appears to be science is really advocacy, usually for powerful corporate interests.
He’s now a professor at George Washington University, but before, he led the US Occupational Safety and Health Administration, better known as OSHA, under President Obama and was President Clinton’s assistant secretary of energy for environment, health, and safety.
Bethany: Michaels’ core idea is the concept of mercenary science, by which he means scientists who are paid—and paid very well, let’s stipulate—to produce studies that aren’t designed to better understand the world or to help make the world a better place, but rather, to defend products or practices that have come under fire for being unsafe and yet, which make a lot of money for corporate America.
Michaels argues that sort of like Macbeth, the truth eventually does out, but only after corporations have continued to rake in money and after much damage has been done. He writes this: “Rare is the CEO of today who, in the face of public concern about a potentially dangerous product, says, ‘Let’s hire the best scientists to figure out if the problem is real, and then, if it is, stop making this stuff.’” Wouldn’t that be nice?
Instead, Michaels argues, they open the Big Tobacco playbook, which says it’s always easier to dispute the science than debate the policy. He writes detailed case study after case study, from tobacco to opioids to alcohol to sugar, and as one reviewer wrote, “The connective tissue between them all involves doubt, denial, delay, distraction, deflection, and defense of the products in question.”
Luigi: The book is full of scary examples, and I highly recommend it, unless you really like to drink wine and you don’t want to know how bad it is for you.
Bethany: Can we just ignore that part of it, Luigi? Let’s just skip that chapter, OK?
Luigi: Let’s just skip that chapter.
Bethany: I think the book is full of fascinating examples, like the fact that Purdue Pharmaceuticals, the inventor of oxycodone, financed a bunch of medical doctors who developed the theory of pseudoaddiction, which essentially posited that an addiction to opioids isn’t a real addiction. I know, I know. But at the time, a lot of people either were convinced or pretended to be convinced.
Luigi: I completely agree, but I want to push Michaels a bit farther. I want to see whether the main fault is just at the company level or at the university level or maybe a bit of both, and last but not least, what role do journalists play in all this?
Bethany: David, we thought we’d start by asking you to explain Big Tobacco for our listeners. In some ways, at least, Big Tobacco wrote the playbook for denial and misinformation. Is this still the playbook, and are things better or worse today than in the days of Big Tobacco?
David Michaels: We call this the tobacco playbook not because tobacco invented it, but because tobacco used it so successfully for so long to such enormous profits and to kill so many people. The idea is to question the science related to the hazardous result of exposure to a product.
We really started to learn in the 1940s and 1950s that tobacco caused lung cancer, that cigarette smoking caused lung cancer. Eventually, we learned it caused many other conditions as well.
At the suggestion of experts in the public-relations industry, tobacco didn’t say it doesn’t cause cancer, but, “We need more research, we need to figure out much more, and we shouldn’t stop selling our product while we’re doing this research, and we’re trying to figure out what’s going on.”
They essentially manufactured uncertainty, and it was successful because they could also say to smokers, “You look at the literature, you figure out whether you’re going to stop smoking or not, but you make the choice.”
That changed when the studies came out showing that tobacco smoke not only killed smokers but caused lung cancer among nonsmokers. At that point, tobacco became a public-health issue, and the industry had to really take a much stronger position fighting the science, and so they came up with all sorts of new tactics, like get the raw data from the studies, reanalyze it to make the results go away.
That tobacco model is now, unfortunately, standard operating procedure for many industries, and in fact, some of the same scientific consulting firms, even some of the same scientists who worked on tobacco decades ago, are still at it today, doing that same work for producers of toxic chemicals, for example.
Bethany: You were obviously already pretty cynical about how this world works, given your previous book, when you started working on this book. Nonetheless, was there a particular case study that shocked even you?
David Michaels: That’s a great question. I think the one that really shocked me the most was Volkswagen, when the first studies came out that showed that diesel-engine exhaust increased risk of lung cancer, and Volkswagen had gone all in on diesel.
Later, Dieselgate came out, where it showed that they had software in their cars that didn’t measure pollution in accurate ways, so it looked like the cars were getting great mileage, great pickup, and did not pollute, which was, of course, not true.
But when the studies came out showing that diesel exhaust increased risk of lung cancer, some of the public-relations people at Audi, which is a Volkswagen subsidiary, said, “We really need to respond to this, so let’s do a study with humans where we’ll put them in a chamber, and we’ll have them do exercise. We’ll pump in air with diesel exhaust and show that it’s not dangerous,” even though that wouldn’t look at cancer.
But finally, someone pointed out to them that a German company putting people into chambers and pumping in a gas probably was . . . They’re “poor optics,” I think was the word that was used.
Luigi: Sorry, not just one German company, that German company, because Volkswagen was a creation of Hitler.
David Michaels: That’s right. The people’s wagon. That’s right. The people’s car.
So, they decide, “Well, we’ll do that with monkeys,” and they brought a car, a Volkswagen, they drove it from LA and hooked in the tailpipe so they could pump it in. They had to have the monkeys watching TV to keep them calm. They watched cartoons while they were breathing in this, and they did the study all wrong, it turns out, the folks they hired.
So, they didn’t find the result they wanted, and then the trade association that’s run by Volkswagen said, “Well, we’re not going to pay you until you get the right result.”
Lily Tomlin once said, “No matter how cynical I get, it’s hard to keep up,” and that one, I thought, sort of won the prize.
Luigi: In your book, you cite one of my favorite quotes by Upton Sinclair, that it is difficult to get a man to understand something when his salary depends on his not understanding it. Clearly, in the case of tobacco, we had the smoking gun of these executives knowing how bad tobacco was and hiding it.
Is it possible to distinguish between, if you want, what I call psychopathic executives who don’t care about killing people just to make money and some form of cognitive dissonance of the type of the one described by Sinclair? Because I had a harder time believing that alcohol was bad for you because I like alcohol, but I am ready to sign and jump on American football. I find American football horrendous. I think it’s a crime against humanity. I would stop it tomorrow because I particularly don’t enjoy it. To what extent do you think there is this distor-tion?
David Michaels: I think you’ve hit upon an important point that we can learn a lot from the studies of the behavioral sciences. You could call it motivational reasoning; you could call it confirmation bias.
Look, I can’t put myself in the heads of CEOs of, say, DuPont, who made these PFAS chemicals for a long time. I certainly am willing to concede they had no idea that it caused illness. They looked at the literature or what they were told by their staff, and they didn’t believe it for perhaps good reasons, which is why I think we have to have systems where unconflicted experts examine the data, because if you have a financial relationship with companies, whether it’s football, whether it’s a chemical, whether it’s alcohol, I think there’s a lot of evidence that you can’t see what is obviously there and can be seen by people who are unconflicted.
Bethany: Luigi and I don’t always agree on everything, but we actually do agree on alcohol and football, so, I guess, cheers to that.
A follow-up from that: If we’re willing to give executives at companies at least the benefit of some degree of doubt in saying, do they actually, fully understand, what about the scientists and the people who run these consulting firms?
You had some lines in your book you pulled from what some employees had said on Glassdoor about their employers, and you quoted one as saying, “Some of the principal scientists have questionable ethics,” or another saying, “Sometimes you’ll be working for evildoers and trying to make it seem like they did nothing wrong.”
Do you think the scientists who serve as these consultants should be held to a higher standard?
David Michaels: I do, because the business model of these companies, these scientific consulting firms, is to provide whatever product it is that their client wants, where the purpose of these scientific consultant firms is to essentially obscure the truth and to ensure that dangerous products can stay on the market. They would be out of business if they started providing reports that said, “Well, it’s not clear, and there’s a reasonable shot that this chemical causes cancer.” They wouldn’t get any more jobs.
I think they should be held to a higher standard. In fact, there’s lots of evidence that comes out in court cases saying, “Well, let’s do this study this way because this is what we’ll find.”
One of the examples I talk about is the consultants hired by Johnson & Johnson 25 years ago, when the United States National Toxicology Program was considering labeling talc as a potential carcinogen. We know now that there’s been a huge fight over baby powder. Johnson & Johnson actually, finally, has announced they’ve stopped selling talc-based baby powder.
They could have done that 25 years ago, but instead, they hired a company to essentially confuse the board of scientific counselors of the National Toxicology Program so they wouldn’t label it as a carcinogen. In fact, the memos that came out in the lawsuit said, “Here’s our objective: time for more confusion.” That’s pretty straightforward to me that that’s why these firms exist.
Luigi: But the disturbing thing to me, at least, is not just that these firms exist, but they are kind of intermingled with academics. If these firms exist, and we’re completely in a separate universe, OK, they exist, but why in the academic community do we tolerate the presence of people who are back and forth? In the academic world, you understand that oh, no, you need to prostitute yourself occasionally, but we don’t really enforce this against you in this way.
This, to me, is reinforced by the fact that many expert opinions, at least in my field—I don’t know in your field—but they are sealed, and they’re not disclosed. I can freely say something contrary to every bit of knowledge in economics and still get away with that because nobody can refute that, or at least the reputation did not spill over outside of the trial. What can we do about that?
David Michaels: Well, you raise a really important point. We shouldn’t be putting academics like ourselves on a pedestal. We are people with the same financial needs, the same greed, the same concerns, the same need for engagement and also for praise. But one thing we can do, I think, is demand transparency.
One of the things I did when I was running OSHA is I said that if you are going to be sending in comments around a regulatory procedure—OSHA at the time was moving toward a new standard on silica exposure and on beryllium exposure—you should at least disclose who paid for your comments and if you have a financial conflict of interest. Certainly, in the scientific world, in the biomedical world, you can’t publish a paper anymore without disclosing that information. I don’t know if it’s true in economics, I would hope it would be, but the top journals all insist on that.
But the US government doesn’t require that when you put comments into a regulatory proceeding. We have no idea if, when an academic puts comments in, who paid for it. Sometimes they will disclose it, but sometimes they won’t.
I would like to see universities be more transparent around the payments that go to academics and the work that they do, but I don’t think we can stop them. On the other hand, I think if we have full disclosure and transparency, it’ll get us at least part of the way there.
Bethany: Theoretically, I love your idea of having independent scientists look at this and perhaps look at things, and perhaps I’m too cynical, but is there such a thing as real independence, and how do you know what it is?
I see this all the time in corporate America, where you have a board member who is ostensibly independent by all the conventional definitions, yet that person craves being liked by management. You can have a board member who is not independent, who may have financial ties to management, but who really doesn’t give a damn and is happy to call things as she sees them.
I worry about the same things with scientists, too. You can have a scientist who looks independent but who wants the approval of corporate America, and you can have a scientist who doesn’t look independent but who actually is willing to call it as they see it. How do you think about independence, and do you worry about that issue?
David Michaels: I think there’s a couple of good models out there. The one I like the most—and none of these are perfect—is called the Health Effects Institute that was set up jointly by the motor-vehicle industry, Ford, GM, what used to be Chrysler, et cetera, and the EPA.
At the beginning, they each supplied half the budget. Now, it’s gotten more complicated because there are more parties involved, but they do studies, they commission studies. They’re very transparent. They have a board of corporate people and government people. They really have contributed tremendously to our understanding of automobile-related air pollution.
There have been a couple of studies that have come out that were very controversial. There’s a study called the Harvard Six Cities Study, where some Harvard epidemiologists put backpacks with exposure-assessment devices on them in six cities, some with low pollution, some with high pollution, then looked at asthma and other respiratory diseases. The oil industry hated that study—or just the fossil-fuel industry hated that study—but HEI commissioned a review of it, and they said, “Look, this study’s a good study.”
Recently, there have been some studies done on the effect of diesel exposure, diesel exhaust, done in underground mines because that’s the only place you can get people who are exposed to only diesel exhaust and nothing else. Again, parts of the diesel-engine industry, like Navistar and the big oil producers, did not like that study. They claimed it was totally wrong, but then the Health Effects Institute did a review, an independent review, and said, “No, it’s a good study.”
I’m impressed. It can be done. It costs some money, but in the big picture, especially around that issue, it’s a very inexpensive way to decide what’s good science and, also, what we need to know to be able to protect people from air pollution.
Bethany: Since Luigi has just been beating up on his profession, I guess I should beat up on mine. Shouldn’t it be the job of the press to be able to uncover some of this and be able to say, “This study is full of s——t; this is one you can trust.” Is the information simply not there for the press to be able to do what ostensibly should be our job, or is the information available, and the press is just failing to do its job?
David Michaels: Well, I think the press is getting better. I think the climate crisis has led to a rejection of what we sometimes call both-siderism. Reporters no longer try to get a spokesperson from the Heartland Institute or Exxon to say, “No, this climate change stuff isn’t real,” anymore. That’s in the past, and I think that’s now expanding to other areas as well.
It really does take a little bit of research to see that the expert or the firm that’s commenting, saying, “Well, this particular exposure isn’t so dangerous,” if you go back and look at their history of all the different comments they’ve made in the past saying, for example . . . The thing that’s in the news right now, the PFAS chemicals, the forever chemicals, for years 3M and DuPont hired a series of firms to essentially say there is no evidence that this is associated with any sort of immunological outcome or cancer.
We now know that isn’t true. There are tons and tons of studies showing the danger, and the costs of cleaning this up are enormous, in the many billions of dollars, which is unfortunate, because if they had stopped exposure 20 years ago, we’d be in much better shape.
But the press doesn’t go back and say, “The folks who said this about PFAS also said this about asbestos and tobacco,” et cetera. It could be done. I get calls from reporters occasionally who read my book and say, “Wow, I didn’t know that this same scientist was working on this chemical or that chemical or the one before.” I think hopefully it’ll get better.
Bethany: I think you should put together a database of conflicted scientists, and you should have every scientist be searchable for the work that they’ve done on previous . . . let’s call them campaigns.
Luigi: Actually, Bethany, beware of what you wish for because we might create one like this at the Stigler Center. I’m actually doing some research on conflicts of interest in economics, where now we have disclosure, but it’s voluntary disclosure, and I’m actually struggling, for example, to define what is a conflict because this is very subjective.
Past conflicts are easier to determine in an objective way. The trickiest things, in my view, are future conflicts. If I want to signal myself a good defender of the faith, I might not be paid for, but I am much more aggressive in defending that in order to get a certain position.
If I were to say that CEOs are underpaid, my chances of getting on a board are much higher than if I go around saying that they are paid too much, and they should be curtailed. But until I get a board position, I don’t have any verifiable conflict, but the conflict is there if I really want to achieve that. That’s problem number one.
Problem number two, if I generically benefit from it, should I write at the bottom of every op-ed, for example, all my conflicts? Number three, if there is not an objective comparison, how do I know that you’re not lying? The sanctions for lying are basically nonexistent.
David Michaels: You’re absolutely right. To your first point, I’ve seen plenty of evidence that some of these consulting firms look at subjects they think will be lucrative for them, and they say: “Well, let’s invest a little money. We’ll write a paper, and that will make us the expert, and then we will get hired to do it,” knowing that, obviously, the papers that they write will have to exonerate these chemicals. Which is why I think, for important issues where society needs to know what is the right answer, or at least what we think is close to the right answer, it’s worthwhile for the government somehow, the society, to say, “OK, we’re going to hire some scientists, some experts, to look at this subject who have no financial conflict, who are not related to this, to give us the answer.”
It’s sort of the model of the National Academy of Sciences, which works to some extent, but it’s a very expensive, time-consuming process.
The other place this all is argued out, obviously, is in litigation. Equally, you’ve got competing scientists on both sides. Then, you either have a judge or jurors who try to figure out which side is right. It’s not an efficient system. There are huge frictional costs. People who should be compensated often aren’t, and people who are compensated probably shouldn’t be, but we don’t really have a good system to deal with these, and so, we need to think about, is there an investment that could be made that can make this system work much better?
Bethany: Expand on that a little bit because I often think that in the US, the system, our litigation system, does serve as a sort of regulation. In other words, private law firms are more than willing to bring big lawsuits where they see the hope of a payoff, and they serve as sort of an after-the-fact, nongovernmental enforcement mechanism. Why isn’t that the right answer?
David Michaels: I think it is an answer, and I certainly saw it up close. I worked on a chemical called diacetyl, which isn’t so well known, but it’s the butter-flavor chemical that was used in buttered popcorn. It was associated with a condition that you heard about 15 years ago, but don’t hear about anymore, called popcorn lung. It was discovered in a microwave-popcorn factory in Missouri, where they changed the formula, and more than 10 workers had their lungs destroyed. They actually had to get lung transplants.
Numerous cases were then discovered in other popcorn factories, in a buttermilk-pancake factory, and various things, and there were immediate lawsuits, and there were about $100 million in awards and settlements within a few years. At that point, before I was the administrator of OSHA, I had written that OSHA should issue an emergency standard to protect workers from diacetyl.
By the time I got to OSHA two years later, the industry had stepped in, the trade association called FEMA, the Flavor Extract Manufacturers Association. They had the acronym a hundred years before the Federal Emergency Management Agency. FEMA had stepped in with all the manufacturers of diacetyl and said, “You can’t use diacetyl anymore for any sort of food flavoring that people could inhale.” It’s safe to eat.
So, litigation had solved the problem even before OSHA could get to it. It would have taken OSHA years to get to it. OSHA is underresourced. So, it certainly is effective that litigation and fear of litigation really does have a big impact, but it’s also too late. That only occurs after people get sick, and for cases that are less clear, it doesn’t happen.
What I’d like to see is moving toward a situation where we protect people from exposures before we have to prove that they’ve killed people. For OSHA, for example, it’s only after you show that there’s tremendous harm done that you begin to move toward a regulation. It takes years to issue the regulation, and even if exposure stops, the long tail of disease it caused will go on for decades.
Litigation can be more effective than regulation, but I’d prefer to see a regulatory system that says: “Well, this chemical looks like it could be causing illness, or this exposure. Let’s figure out how to protect people before people get sick,” because neither the current regulatory system nor litigation does that.
Luigi: Now, your book is full of tragic stories, in part because they’re selected to be tragic. There’s nothing bad about that, but I would like to know the nontragic story. One of my other addictions is coffee, and at some point coffee was considered dangerous. There was one article about this. When is it right to jump . . . You could argue that based on that article, you should prevent everybody from drinking coffee. Now, Bethany and I would revolt, and so, probably, would another hundred million Americans. So, when is the right time to intervene, and when is intervention too early?
David Michaels: Absolutely, that’s a big issue. Of course, I remember the pancreatic cancer and coffee study from 30 years ago or so that put the fear of God into everyone who drank coffee and turned out to be wrong, and that’s certainly going to happen. I think what you need then, as I’ve said before, is this impartial regulatory system that can really weigh things out. One study is not enough.
In a case like coffee, where we have tens of millions of people exposed on a daily basis, we probably in that case should launch studies. We should pay for studies to be done to figure out that question. It’s very different when you have something that isn’t yet on the market and want to say, OK, how can we determine whether this should go on the market, versus something that’s out there a great deal that we really need to figure out, is it making people sick?
It’s never going to be easy. These are tough questions because you can’t just study them in people. If we could randomize coffee exposure, take half the people, and give them six cups a day for 30 years, and the other random half not, we could answer the question, but you can’t do that with people. We have to use animal studies and analogies and things like that. It’s a challenge.
Luigi: To what extent is the United States worse than other developed countries in this dimension? In many instances in your book, I think it’s IARC, the International Agency for Research on Cancer, calls things much earlier than the corresponding American Institute for Cancer Research. Why are we doing so poorly?
David Michaels: In the United States, we don’t have a nimble regulatory system. Most of our regulatory requirements are based on this idea that an exposure is innocent until proven guilty, but with a chemical, you have to go to a much higher standard. We have to say, “OK, this is causing illness; therefore, we’re going to protect people.” Where IARC, for example, just has to say, “This is what we think.”
Because our regulatory system is part of a legal system, we know, for example, OSHA takes a decade or more to issue a standard. The requirements are based on the OSHA law, and then court decisions say OSHA has to go through these various steps and make these various proofs, and if OSHA makes a mistake anywhere in there, they will lose in court afterwards because every health standard is taken to court. It just takes a long time.
Our system is built not for speed. It’s durable in that once a regulation is issued, in almost all cases, it has a really significant effect, but it takes so long to get there that there’s a big price to be paid by people who have these exposures before that.
Heat is an example right now. I get calls all the time about heat. OSHA does not have a heat standard. It will take years, even in this period when we have workers exposed to deadly levels of heat. For OSHA to issue a standard to protect workers from heat will take several years at least.
Bethany: Can you make that system more nimble?
David Michaels: Congress could do that, but Congress, of course, is paralyzed.
Luigi: I would like to think that we can do something without necessarily involving Congress because that becomes hopeless. You teach in a school of public policy, if I’m not mistaken. Here, at the University of Chicago, we have a survey that another center organizes, where we ask a bunch of economists across the country their opinion on something. The economists answer, and they provide a short explanation for the answer. I think it would be incredibly helpful to have something like this by a panel of independent experts in the various fields on issues of the day.
I’m old enough to actually remember the article on coffee, and it scared the hell out of me. I read an article on coffee; should I jump and stop drinking coffee? If I look at the panel, and I have a panel of independent experts that say the evidence is not enough for the moment to do that . . . Ten years later or three years later, depending on the study, they say, “Actually, there is evidence or there is not evidence.” The beauty is that the journalists could actually look at it, see the explanation.
The only thing to be done is to make sure that these people are nonconflicted—that might be different—and picking a panel with a sufficient variety of experts. But that would also be very helpful, honestly, in litigation, because what I fear there is precisely a lack of an independent opinion.
IARC is good because if I go into litigation and say it has been mentioned as a probable cause of cancer by IARC, this carries some weight. If you say it is mentioned as a cause of cancer by an independent panel of experts at the University of Washington, that’s something.
David Michaels: I think that’s a great idea. Now, I’m in a school of public health, George Washington University School of Public Health. I’ve seen that sort of panel before around COVID, which was a great idea because the science was changing, and the exposures were changing on a regular basis.
For example, the New York Times surveyed a bunch of epidemiologists, saying: “What are you doing now? Are you flying? Are you eating in restaurants inside?” I think that was terrific to see, first, there’s some range of response, but also, you get a sense of what’s going on. That’s certainly something that would be worth considering.
Luigi: I actually think that in the case of the pandemic, it was done in the wrong way because it was precisely asking your preferences. Honestly, I don’t care about your preferences. I care about your expert opinion of risk. Is this carcinogenic, knowing the evidence, or not? This is where an expert can say yes or no. Knowing that this is carcinogenic, whether you want to drink it or not, that’s a personal preference.
Unfortunately, I learned from your book—I was trying to avoid this—that actually, alcohol at any level is carcinogenic, which makes me very sad. I still drink it. I try to drink less, but I still drink it. That’s a personal choice. But I think that on the objective part, I don’t find myself—and I’m a pretty informed reader—with a place to go to learn, is this particular substance carcinogenic and with what probability?
David Michaels: But look at the issue. Let’s say you’re concerned about cosmetic products or shampoos, for example. You can’t look at the side of your shampoo bottle, which lists 50 different chemicals and say, “Which ones of these are safe? Should I use this?”
You need a system which is going to answer those questions in more detail and also encourage removal of certain chemicals from potential exposure. But certainly, there are ways to get there that we haven’t really considered or gotten there yet, and I think it’s probably something we should be thinking about.
Luigi: I have one last question, which is one of my obsessions, especially in the field of economics. More than money, data can corrupt you because a lot of firms—and certainly think about digital platforms, but not only them—own a lot of very valuable data.
If you get access, exclusive access, to Amazon data, Uber data, whatever, I think you can get tenure at a top university just writing papers with those data. But no money exchanges hands, and companies pick only certain people to use their data. If you have a history of exposing things, you’re the last one to be granted that data. I think that universities should be much more attentive in this dimension.
A colleague in the medical department tells me that many companies finance large studies, randomized studies, but they own the data of the research, and by owning the data, they can stop publication if they want to. I think it should be illegal for people at universities to work under these conditions. The university should put up a barrier that anything that people research at the university cannot be blocked from publication because otherwise, we’re not independent research. We are a PR effort.
David Michaels: You’re right, and there have been a couple of examples in the biomedical world where people had moved toward publishing a study that the owner of the data blocked them. Now, many of the leading medical journals and the International Association of Medical Journal Editors require first authors to sign a disclosure that they had the unfettered right to publish, and they did not have to approve it, and also, that they did not review the results with the source of the data. It still raises the question about getting access, and obviously, if you’re not someone who an industry trusts, you won’t get access. But I think we have made some progress in that area that you can’t publish in New England Journal of Medicine or JAMA now, unless you say you had the unfettered right to publish. At least we’re getting somewhere in that area.
Bethany: Well, thank you so much for joining us.
David Michaels: It was lovely chatting with you both. Thank you.
Luigi: I think that what he’s doing is very useful, and I don’t want in any way to undermine what he was doing, but I want to make sure that we understand two things. Number one is, what is the optimal behavior that you should follow? If you are a company and all of a sudden, they tell you that your product kills people, like maybe coffee, should you stop producing coffee? You’re going to try to ask some experts to tell you whether the coffee is really dangerous or not. To what extent do you actively seek biased experts—which I’m sure is the case a lot of times—and to what extent do the experts naturally bias themselves in your favor?
If I hire a consultant, the first thing consultants learn is how not to piss off their boss because otherwise, they’re not rehired. Is it the fault of the companies or the fault of the scientists? I think it is, of course, as usual, a little bit of both, but how can we fix it? I think we need to put a mechanism in place on both sides.
Bethany: I really liked that he was not dogmatic about the notion that these were bad people setting out to do bad things and that it is a case-by-case basis. In some cases, it is bad people setting out to do bad things, and in other cases, it is people with motivated reasoning or people who are simply blinded by confirmation bias.
I agree that his search for independence is a little more fraught. Finding somebody who is truly independent is tricky because all of us have hidden biases. On top of that, science by its nature can be wrong, per your great example about coffee. You can come up with an example of a product that appears to hurt people, and then it can turn out that the whole thing was wrong and not because anybody intended to be wrong. Then, is the right thing for a company to do to yank its product off the market as soon as somebody says this might be dangerous? That seems to set up a whole series of problems in the other direction.
I think what he’s getting at is to come up with a way to force the incentives for a corporation to be different, a mechanism that is timelier than litigation, so that the incentive for a company is, how do we get to the bottom of this? How do we find out what the truth is? Even if that process isn’t perfect, and even if truth itself sometimes, actually, really is debatable, how do we do the best job we possibly can to get at truth? Rather than one that incentivizes companies to say, “How do we make sure we prolong this for as long as possible by,” and I loved David’s phrase, “manufacturing uncertainty”?
Luigi: One important element, in my view, that emerges from the book is that companies very often use industry associations to perform these dirty tricks. This is interesting because they kind of disassociate themselves from the responsibility. All the stories about sugar, about alcohol, they’re not attributed to that particular sugar company or that particular alcohol company. It is more a collective part of the industry, and certainly no individual football team has taken responsibility for what the National Football League has done. As a result, the individual teams get away, literally, with murder because they are protecting themselves with this pseudoscience, and they don’t bear any individual reputational cost.
Bethany: That’s fascinating, the way in which big might allow the evasion of responsibility because there no longer is reputational damage if people don’t associate a product with a company, because the company makes so many products that who remembers who makes what?
But I think your point, also, about the way in which the damage is deflected to an association is really interesting. I don’t think I can ever think about associations in quite the same way again after hearing about what FEMA, the fragrance . . . But now, I think every time I hear an acronym that stands for some sort of association behind which hides all these awful things, I think I’m always going to have to think twice about what the acronym actually is. It is kind of funny, too, the use of these bland acronyms and these very bland names to hide and, you’re right, to serve as a public interface in a way that allows the deflection of any kind of accountability.
Luigi: But did you understand what he said that, actually, that substance I can’t pronounce that sounds like butter is still used everywhere, as long as you don’t inhale it, which doesn’t make me very confident?
Bethany: No, I know, I wasn’t sure whether to pause on the fact that movie-theater buttered popcorn, which is one of the delights of the world, may actually be really terrible for you or whether to pause on the wait, wait, wait, the stuff is still being made, as long as you don’t inhale it, and somehow you can ingest it, but if you don’t inhale, one in- word is okay and one in- word is not okay. We should have asked him more about that, but it felt like a tangent at the time. Maybe it’s not. It’s popcorn, after all.
Luigi: I think that it’s interesting because there was a big uproar and boycotting on one side, on another, on the issue of Kaepernick in the NFL. I’m not saying that’s not an important issue, but the issue that they might end up killing their players, nobody boycotted any NFL organization as a result of that. The case of the National Football League is particularly bad.
There are cases that are more ambiguous and actually, I appreciate it because I did do independent research on the DuPont case. He describes it as more balanced in that particular case that people took some time to figure out how lethal this stuff was. At least for a number of years, they put a quasi-best effort into finding out, because it’s one thing to say we’re going to try but another thing to pretend that we’re going to try.
But in the NFL case, they didn’t even try. In my view, they really manufactured doubts right away, in a way that is very dangerous, and I think there has been a conspiracy of silence on this. Do you know the fact that we know from some hacking that the NFL pressured Sony to make the movie Concussion less brutal in order to preserve its franchise?
Bethany: The problem is that the sole cost of this is born by the football players themselves after they’ve left the league, with no cost borne by the league and no cost borne by the fans.
Do you remember the old New York magazine? I keep coming back to this. They had this wonderful chart in every issue of the magazine, and it would be an axis divided into quadrants, and one axis would be brilliant to stupid, and the other axis would be highbrow to lowbrow. Something that was in the news that week could land in the upper-right-hand quadrant, which would be both brilliant and highbrow, or it could land in the brilliant and lowbrow category. I think a lot of life can be simplified by thinking of things in quadrants.
I was thinking the axis for products maybe should be, who bears the cost of the externalities? That should be one axis, that the company itself bears the cost, or people disconnected with it bear the cost. The other axis should be, can people understand the risks of this themselves, or can they not understand the risks without an expert?
If something goes in the quadrant where outsiders bear all the costs of this going wrong, and people have no chance of understanding it for themselves, then it should be thought about differently than something that goes in the quadrant where the company itself is going to bear all the costs of something going wrong, and consumers actually could do their homework and figure it out for themselves. Right?
Luigi: Yeah, I completely agree. To some extent we economists are liable of thinking only on the dimension of externalities and only very recently are we more attuned to the fact that not everybody’s perfectly well-informed. That’s an important dimension.
But this is where the dimension, I’m sorry to say, of the media world at large is important, because the point I wanted to make is—and I agree that information is not enough— there’s not even that information given. It’s just how many reminders, how many articles about this, there are daily. In every package of cigarettes, you see, “Cigarettes cause cancer.” You don’t have in every football a statement saying, “Football kills your brain.”
Bethany: I always thought that a version of that, after the 2008 financial crisis, would be that every time you’re signing a mortgage, you should just be forced to read . . . Skip all the complicated disclosures that all the regulators decided on. All it needs to say is, across the top when you’re signing your mortgage, about the mortgage broker you’re working with: “I am not working in your interest. I’m trying to sell you this product, and I’m acting like your friend and your advisor, but I’m actually not.”
If there are big letters across the top of every page that said that, then people would probably approach signing a mortgage a little bit differently.
Luigi: Absolutely. That’s an excellent idea.
Bethany: I think part of what goes wrong in our . . . I used to be much more hardcore about the idea of personal responsibility. I still am, to some extent, because I think that without a basic belief in personal responsibility, we’re all lost, but yet a lot goes wrong in the games we all play where someone pretends to be your friend and they’re not.
You can say that a sophisticated person should be able to see through that and understand that the person is marketing themselves as your advisor and your friend, and they’re not. But face it, we don’t live in a world where everybody has the privilege of being sophisticated, and I think that’s a real problem.
Luigi: Absolutely. On top of this, the scary part is the ability of these efforts by corporations and industry associations to really change the perception that most people have of the risks. The idea that, actually, the only cause of heart disease is fat has been so pervasive, and now, reading the book, you figure out the sugar is at least as bad. The claim in the book is that this obsession with fat was a clever push by the sugar industry that made sure that you go in that direction. Even when you eat meat, you know that the hamburger in McDonald’s, there’s some sugar in it because people like sugar, so they put sugar everywhere, and you get addicted to sugar even without knowing it because you don’t know what is in those products.
Let’s talk about solutions, because we’re bellyaching enough that we need to think about solutions. I think that the idea of having some scientists’ expert opinion on matters of fact that are aggregated with what a majority thinks, but also see the variation and the explanation written in a few words, I think would be very useful. Now, this is not useful, of course, for the unsophisticated people, so it’s a little bit self-serving because it would be very useful for you and me, but it’s at least the beginning.
Bethany: It would be incredibly useful for a journalist because I can’t help thinking about all the things that journalists get wrong. The reality is that journalists come at a lot of stories with motivated reasoning, and if you can find a study that says something that works for your article or your point of view, then you will use it without investigating whether the study in question is actually done well, and that happens all the time.
But even when that doesn’t happen, are most journalists under time pressure capable of getting to the bottom of what a study actually says and what it doesn’t say, when even scientists themselves aren’t necessarily capable of it, when figuring out what the study says and what it doesn’t say is sometimes so complicated that it has to be litigated in court?
I don’t know. If there were an independent, third-party body that you could go to and say, “Hey, about this study,” it would go a long way. Even if that third-party work weren’t always perfect, it would go a long way, because if the body were credible, it would very quickly be best practices in the press to have to call that body before you quoted a study. That would, in and of itself, start to cut down on the propagation of dubious studies because you’d know. It would be obvious that somebody sought to cite a dubious study if they didn’t make that phone call.
Did you have one big takeaway from this episode that made you excited?
Luigi: I think I was excited about this idea of the expert panel that could make a difference, and we need to find mechanisms to enforce reputation more effectively. We’re not very good at that, and as a result, a lot of people and a lot of corporations get away with, literally, murder.
In some cases, it’s very difficult. When you have phenomena that take 30 years to materialize, it’s very hard to keep people accountable. But also, there should be a level of strictness for products, et cetera. Because when a product kills you right away, even corporations are very good at dealing with it, and the example of the popcorn is a leading one. What is very problematic is when things kill you slowly and with a small and variable probability. Even detecting it is hard. Proving it is close to impossible, and enforcing liability, extremely rare. Enforcing your reputation, zero.
From a regulatory point of view, maybe we should actually do something about the low-probability but high-cost risks that are precisely the ones that are ordinarily ignored by everybody, including the regulators. Because if you’re a regulator, are you really going to put up a fight for something that is going to materialize 30 years from now? Unless you are really, really public-spirited, probably not.
Bethany: I like that idea. A question on it. If you were to create this independent body, if you could design it and will it into being, who would you have fund it? Because you can’t have it funded by corporate America. You can’t really have it funded by Congress because Congress is bought by corporate America. Who would fund it in a way to keep it independent?
Luigi: I don’t think it is so much the funding as the allocation of the funds. You can easily impose or require a tax for the corporations that every time they introduce a new product, they put a certain amount into a fund to study those products, but they don’t control who does the study. But that’s only deflecting your very good question, which is, who’s going to allocate? Who’s going to do that?
Bethany: You anticipated my follow-up.
Luigi: Of course.
Bethany: Thank you.
Luigi: I know you enough to know that I cannot deflect you easily with that. I think that’s the real question. My natural inclination would be that I would like to have some real scientists do that. The problem is, number one, how do you pick them, and number two, what I learned over the years is once you design an independent institution, you’re making it very attractive as a target to be bought off. When agencies were created at the beginning, they were very independent. Over time, they are really captured.
Bethany: I had two takeaways. One, perhaps small, but I really did like this notion of the various costs of bigness because I’ve always thought of the cost of our society of giant corporations is that they’re unmoored from communities, so they don’t have to bear responsibility to the communities in which they live, because the CEO isn’t going to run into somebody he sold a bad product to at the local country club or whatever.
But this idea that there’s another cost of bigness in the evasion of reputational damage, that it just is impossible to keep track of who sells what. When it comes to something like Merck and Vioxx, it just doesn’t do that much damage because nobody remembers to associate Vioxx with Merck. Maybe it’s not a huge part of our podcast, but I thought about that.
The other thing I thought about is actually more about a life issue. I thought, for all the uncertainties and vagaries of journalism today, I thought how lucky I am to have found my way to journalism. Because I remember being a banker and an M&A banker specifically, although banker is too august a word for what I did. I was so junior.
But that was motivated reasoning at its best. You weren’t trying to get to the right answer. You were trying to get to the answer that was right. In other words, when you put a valuation on a company, you were trying to get to a certain number. You weren’t trying to figure out what the company was actually worth. I thought, what a privilege it’s been to be able to work in a field where, whether I’ve gotten it right or not—and there are things I’ve gotten right, and there are things I’ve gotten wrong—but at least I’ve always been trying to get to the truth and trying to get to the right answer.
I thought, for anybody who’s listening who is young, maybe that’s a framework to help think about what you want to do. Is the work you’re going into one where you really get to be engaged in a search for the truth? Or is it one where there are going to be constant forces on you to be getting to the answer that is right, not the right answer?
Luigi: I love that, and honestly, that’s the way I feel about my own profession. I don’t think that everybody feels the same way in academia or in journalism, but I think that certainly, both academia and journalism give opportunities to people to do that, and I’m very happy to have made that choice.
Bethany: We end in agreement. Oh, my goodness.
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