Reason Magazine - Staff

Shades of Green

info@reason.com (Alexander Volokh) — Fri, 01 May 1998 00:00:00 EDT

A few years ago, Mary Gade realized that managers of small businesses in Illinois were scared to death of being severely punished for accidentally violating complicated environmental laws. These managers were so scared, in fact, that they often didn't want to ask for the state's help in fixing their environmental problems. Gade thought that was a shame, and as the director of the Illinois Environmental Protection Agency, she was in a position to do something about it. In 1995, Gade set up Clean Break, a program that offers small businesses help in complying with environmental regulations and relief from penalties, provided they fix their problems within a reasonable time.

Gade also felt that contaminated industrial sites in Illinois were taking too long to redevelop. The cleanup standards were unrealistically strict, and developers were afraid that if they took the trouble to clean up a site, they not only would have to waste money chasing the last stray molecule of pollution but could be sued by a future user of the property for contamination they didn't even cause. Many sites were abandoned or remained perpetually undeveloped. In 1993, the Illinois EPA created a set of flexible cleanup standards and limited liability releases that have made possible the voluntary redevelopment of hundreds of contaminated sites.

Gade, who worked for the U.S. EPA for 13 years before heading the Illinois EPA, stresses that these kinds of imaginative initiatives would have been impossible at the federal level. "States are particularly well positioned" for experimentation, she says. "We make great laboratories." Gade adds that the U.S. EPA may no longer be the best place to make many sorts of environmental decisions. "The federal government is not being as helpful and constructive as they could be," she says, and "the environmental management system of this country, after 30 years, is ready for a major rethinking and overhaul."

Environmental regulation is undergoing a sea change in the United States. The old environmental vision, shaped in the 1960s and '70s, was crisis-driven. It distrusted markets, property, and the private sector, and so punishment rather than cooperation was the preferred method for getting people to comply with the law. It assumed that environmental problems and conditions were pretty much the same everywhere and accordingly called for one-size-fits-all regulations mandating acceptable technologies and approved cleanup methods. The regulations were written by government experts, and it was taken for granted that environmental problems would be solved through the public sector. Furthermore, the prevailing wisdom said the states were incompetent regulators who would strike cozy deals with evil polluters and "race to the bottom," cutting environmental standards to attract businesses. Federal regulators were the ones wearing the white hats.

The new vision of environmental regulation stresses problem-solving instead of punishment. It seeks flexibility in compliance methods so that companies can choose the cheapest way of achieving a given level of environmental quality, instead of having to adopt a single prescribed method. It views the private sector as a necessary partner in environmental improvement. And it tries to bring decision-making authority to the lowest level where it makes sense--so that local problems can have local solutions, state problems can have state solutions, and national problems can have national solutions.

Over the past few years, several states have begun to implement reforms embodying these principles. Their experiences contradict the race-to-the-bottom theory, which does not allow for the possibility that state-driven environmental protection could achieve superior results at lower cost, with less regulation and less intrusiveness. These are some of their stories.

"Brownfields" of Dreams

"Superfund," says Jim Seif, secretary of the Pennsylvania Department of Environmental Protection (DEP), "is the least effective federal environmental statute in history." Seif is referring to the federal law dealing with hazardous site cleanup, officially called the Comprehensive Environmental Response, Compensation, and Liability Act. Superfund was enacted in 1980, in the wake of the Love Canal scare. Today it is widely criticized for making cleanups needlessly expensive and time-consuming, for engendering unnecessary litigation, and for making it almost impossible to return a contaminated site to productive use.

Fortunately, the Superfund program applies only to the sites classified by the federal government as most contaminated. For the remaining sites, known as "brownfields," the Pennsylvania DEP developed the Land Recycling Program, which was authorized by state legislation passed in 1995. The program standardizes cleanup procedures, so owners and potential developers know exactly how much cleanup is necessary. It sets realistic goals--unlike Superfund, which established what Seif describes as "Garden of Eden" standards, "a practice which, of course, produced no cleanups" because of the prohibitive expense. Pennsylvania grants liability releases to owners, developers, and financial institutions that are otherwise reluctant to clean up properties for fear that they will be sued by future owners. And it provides some funding assistance, though most of the cleanups are conducted at private expense.

In contrast with Superfund, the DEP tries to avoid prescribing the specific technology to be used in the cleanup, instead only saying how clean the site should be. While the Pennsylvania program is still prescriptive in some areas, the regulations are by and large based on actual environmental and health risks, encouraging businesses to develop innovative cleanup methods. Instead of requiring the complete elimination of chemicals left by commercial activity, the state sets acceptable levels based on established risks to human health and the environment, taking into account the intended use of the property. (Residential sites, for example, have to be cleaner than industrial sites.) As one DEP official puts it, "We have kind of taken a novel approach in Pennsylvania, trying to base our cleanup program on sound science."

Previous state law held current owners responsible for cleanup, even if prior owners were responsible for the contamination; as a result, it was sometimes more cost effective to abandon a site than to restore it. The Land Recycling Program releases owners or developers of a site from liability associated with their cleanup, as long as the work is done according to specified standards and procedures. State grants or low-interest loans can cover up to 75 percent of the cost of completing an environmental study and implementing a cleanup plan. Once the property has been cleaned up, the DEP releases the landowner from state liability, and state law provides protection from citizens' suits.

One of the highest-profile properties to be redeveloped under the program is the 160-acre site of a shuttered plant owned by Bethlehem Steel. In February 1996 the company signed a partnership agreement with the Smithsonian Institution to establish the National Museum of Industrial History on the plant site, which is being tested for the presence of heavy metals and other materials associated with steelmaking. The first stages of the project--sampling the soil and monitoring the ground water to determine what sort of cleanup is necessary--are mostly completed. The company expects that not much cleanup will be required beyond tearing down buildings and removing debris. Some soil might have to be removed, but more drastic methods, such as pumping and treating ground water or putting in large underground walls to isolate it, are not expected to be necessary.

Once the cleanup is finished, any residual contamination shouldn't pose any health problems because the property will be covered with clean soil, parking lots, and buildings. The museum, which is expected to open in 2001, will be part of a larger education and entertainment complex. "It's been said that Pennsylvania has the most progressive brownfields law in the country," writes Hank Barnette, chairman and CEO of Bethlehem Steel. "Certainly, this is making possible the revitalization of our site in Bethlehem that might otherwise have had a very limited future."

Direct comparisons between Superfund and the state program are tricky, since they cover different types of sites. But in the brief existence of the Land Recycling Program, more than 300 sites have been enrolled and 100 have been cleaned up, while over the last 16 years the Superfund program has worked on 33 of 103 sites in Pennsylvania, and just 10 of these have been removed from the list.

Pennsylvania officials were therefore annoyed at recent federal efforts to limit the scope of state brownfield cleanup programs. One obstacle to cleanups was that no matter what the state guaranteed, the federal government could decide that a site needed additional work under Superfund. To avoid this problem, some states have signed "memoranda of agreement" (MOA) with the U.S. EPA, essentially stating that if a site enters the state cleanup program the feds will leave it alone. In September 1997, the U.S. EPA released a guidance document severely restricting the conditions under which it would sign an MOA: The more flexible a state tried to be in its efforts to get sites cleaned up quickly, the less likely it was to get an MOA. State regulators called the new federal guidelines overly prescriptive and unnecessarily intrusive.

Last November, under intense criticism from state environmental officials, the U.S. EPA withdrew the guidance document, but it has yet to develop a policy of encouraging state experimentation with brownfield cleanup programs. To many state officials, the best federal policy on the matter would be to butt out. "We think that the federal government needs to basically stay out of state business when it relates to brownfields and cleanup programs," says Jim Snyder, director of the Bureau of Land Recycling and Waste Management at the Pennsylvania DEP. The feds "see themselves as being Big Brother and Big Sister to the states, and the states are not interested in that."

In Search of XL-ence

Roger Kanerva, an environmental policy adviser with the Illinois EPA, bristles at the mention of the letters XL. "Please don't use the XL word," he admonishes. "We are not fans of XL." He rolls his eyes and shakes his head.

Project XL is a U.S. EPA program for companies with "XL-ent" environmental performance. Introduced by the White House in 1995 as an "enforcement experiment," it was designed to provide an alternative to the standard system of one-size-fits-all regulations. In theory, facilities that showed they could attain superior environmental results would be granted more flexible permit conditions. The EPA would refrain from punishing violations if a participating facility was acting in good faith.

3M, which makes a wide range of consumer products, medical supplies, and manufacturing materials, applied to the XL program for plants in Minnesota, Illinois, and California. The Illinois EPA supported the Illinois part of the effort and worked with 3M to get the XL project approved. U.S. EPA approval for the XL program was contingent on "superior" environmental performance, but the standard turned out to be a moving target. "What you thought was superior before," Kanerva recalls, "suddenly [wasn't]. We were always one step behind their new definition of how wonderful your project had to be." For instance, while "superior" started out meaning "better than required by existing laws," it ended up meaning "better than the company was performing already"--which penalized companies like 3M, which were already performing substantially better than laws required. Finally, 3M dropped out of the XL program. Frustrated with the vagueness and inconsistency of the federal criteria, the Illinois EPA refused to participate further.

Other companies that have explored the XL program have had experiences similar to 3M's. Part of the problem seems to be the U.S. EPA's inflexibility. The Environmental Council of the States, which represents state environmental agencies, charged that the U.S. EPA mishandled the project by adopting "rigid criteria...in the eleventh hour" and by not allowing a larger role for the states. But even if federal regulators wanted to be flexible, the laws wouldn't give companies much leeway to pursue innovative approaches. Regardless of whether the U.S. EPA punishes a violation, a private individual could always sue over a company's statutory violations.

Disappointed with the XL program, the Illinois EPA prepared its own Environmental Management System (EMS) legislation, which was signed into law in June 1996. The statute gave the agency five years, from 1996 to 2001, to enter into agreements with companies that want to try out new ways of complying with regulatory requirements. This pilot EMS program is open to companies that seek to streamline their permitting procedures or adopt "innovative environmental measures." The Illinois EPA insists that a company's EMS emphasize actual environmental performance, focus on pollution prevention, and guarantee extensive consultation with community groups and leaders. "For this program," says the Illinois EPA, "the most important ingredient is the desire of a regulated entity to chart its own course for environmental progress and to be fully accountable for its performance."

The program is voluntary: No company must join, and the Illinois EPA is not bound to enter into an agreement with any company. The fact that a company chooses to participate means that the agreement makes sense for the company, and the fact that the Illinois EPA agrees means that it expects environmental improvements. The agency doesn't require that the potential for improvement be demonstrated beyond a doubt, which is what stymied the XL program. It reserves the right to approve interesting, innovative projects that might lead to significant environmental benefits.

3M was the first company to negotiate an EMS agreement with the state. The agreement would require 3M to set a waste reduction goal for its adhesive tape factory in Bedford Park and to measure its progress toward that goal. It would lower the ceiling on 3M's emissions while giving the company more flexibility in its day-to-day operations. To avoid problems with the U.S. EPA, the agreement does not address any issues of federal law or permitting.

State officials expect to finalize the agreement with 3M by the end of the summer. Tom Zosel, 3M's manager of environmental initiatives, says the company is optimistic about the arrangement: "We get some operational flexibility, we get better relations with the local community, and the agency gets more information and oversight on our facilities in a way that is less regulatory and less command-and-control. We're making commitments on what we're going to achieve that are better than what the regulations require."

The Illinois EPA hopes to approve a few dozen EMS agreements over the next five years and use the experience to develop new regulations. This learn-by-doing strategy contrasts sharply with the federal approach, which Kanerva describes as a "one-size-fits-all, cookie-cutter, do-it-our-way-or-take-the-highway type of thing." As the Illinois EPA's Bharat Mathur puts it, "One of the reasons XL didn't work is because, typically, when we do something new, there is this great desire to put it into regulation, rules, and guidance. And that's where it gets sticky, because you cannot accommodate all new, emerging situations into rules and guidance right off the bat."

Comical Solution

"I'm not a warm and fuzzy person," says Jim Morgester, compliance division chief for the Air Resources Board at the California EPA. "I am a dyed-in-the-wool enforcement type. I have a military background." But while Morgester was brought up on enforcement, he sees it as a tool, not as an end in itself.

Morgester regulates businesses that generate air emissions, including gas stations, dry cleaners, auto repair shops, paint manufacturers, and furniture factories. Several years ago, he found that only 60 percent of the businesses inspected by the Air Resources Board were staying within emission limits, handling volatile chemicals properly, and completing required paperwork. His goal was to get that number up to 95 percent. The main reason for the widespread failure to follow the law, he concluded, was that people couldn't understand the law. Environmental rules and regulations, he points out, are written by technical people whose terminology is difficult to understand, and then rewritten by attorneys in their own language, with politicians looking over their shoulders and second-guessing the outcome. The result, he says, is "not intelligible to a lot of people."

"I don't care about being nice," Morgester insists. "I care about getting people to comply, and I will use whatever it takes. If I thought that if I put half the population in jail I could get what I wanted, that would be fine by me. But that doesn't work." He divides businesses into three groups: big companies that understand the regulations and can afford environmental auditors; smaller businesses that want to do the right thing but don't have the resources to figure out what that is; and those who, "even if they knew what the right thing was, weren't going to do it anyhow." He adds, "I would rather spend my traditional law enforcement resources on the third class, because it's easier for me socially and politically to bust the bad guys." For the others, he says, an educational approach makes more sense.

California's Compliance Assistance Program was developed in 1988, before such programs had become popular nationwide. For technically knowledgeable managers, Cal/EPA offers a set of blue three-ring binders ("blue books") that contain complete compliance information for a given type of equipment or category of business. For line workers, the program offers nontechnical, comic-book-style information, which is sometimes published in Spanish or Korean as well as English, depending on the type of business involved.

The self-inspection handbook for the dry cleaning industry shows green drums labeled "Waste" with voice bubbles saying "Store and label properly." "And seal tight," proclaim large yellow block letters across the rest of the picture. The handbook includes sample checklists where workers can enter how many pounds of clothes were in each load and keep a service and repair log for the equipment. "Use these...to help prevent a notice of violation," a large talking iron says.

There's a Spanish-language version of the inspection manual for auto repair shops, which tells shop owners about all the different government agencies with the power to regulate them, from fire departments to OSHA to local pollution-control districts. While reminding them that "[exclamdown]Las violaciones son costosas!" (Violations are costly!), the manual shows pictures of unsealed solvent containers, open paint cans, and soiled rags exposed to the air, all of which result in the emission of volatile organic compounds, which contribute to smog.

Since Cal/EPA introduced training and literature for gas stations in the late 1980s, the compliance-assistance program has gradually expanded to cover other sources of emissions. From 1988 through early September 1997, the program distributed roughly 27,000 blue books and 584,000 comic books. The effort to make regulations understandable seems to be having an impact. In the early 1990s, Cal/EPA studies showed that about half of all businesses that use solvents failed to follow the applicable regulations (designed to limit the release of harmful chemicals into the environment). The agency found that the technical manuals and comic books cut noncompliance rates within each industry by 50 percent to 60 percent within a year of their introduction into that industry. By using vapor recovery handbooks, one major gasoline retailer reduced emission-related violations by more than 70 percent over an eight-month period.

Such figures do not tell us whether there were corresponding improvements in the environment and, if so, whether they were worth the cost involved. But regulators such as Morgester argue, reasonably enough, that it's not their job to judge the wisdom of the environmental goals set by policy makers.

There are other limits to compliance assistance. Because of the high turnover rate in industry, Cal/EPA's efforts must be on-going to be effective. New employees have to be trained, or the habits that foster compliance fall by the wayside. And traditional environmentalists argue, not without reason, that while a regime of strict punishment may seem unfair to small businesses that break the rules unintentionally, it deters sloppiness as well as deliberate violations. Business people who are scared of regulators may be scared enough to take extra precautions and avoid mistakes. It is possible to imagine an environmental agency that is too fixated on compliance assistance, to the point where it ignores important problems that require enforcement. And it is the threat of penalties that often drives businesses to the compliance-assistance program in the first place.

Morgester himself believes that the success of the compliance- assistance program depends on inspections, which encourage diligence. He stresses that too many people make a conceptual distinction between helping businesses understand the regulations and traditional enforcement efforts. "They go hand in hand," he says. The situation to avoid, says Morgester, is one where enforcement officers see their job as writing tickets and compliance-assistance people see their job as handing out blue books. Such programs foster tension between the two divisions, encouraging the belief that there are two competing and mutually exclusive philosophies at work within the agency.

"You have only one goal," Morgester says. "I want the emissions to the atmosphere to be reduced so that we get the benefit of the rules and regulations....And if I can get that by being kinder or gentler or nicer-smelling, by buying them lunch, if I had the resources, I would buy them lunch in a second. If I can get that by giving them a blue book, I would give them a blue book in a second. If I get that by giving them a notice of violation and threatening to put them in jail, I will do that in a second. But in the real world no one of those does the job."

While separation and conflict between enforcement and compliance assistance may be counterproductive, it is the approach that prevails at many environmental agencies, including the U.S. EPA. "You cannot and should not ever separate your compliance-assistance, warm-and-fuzzy people from your traditional law enforcement," says Morgester. "It's a big mistake. It does nothing but give you headaches, and you end up wasting resources."

Slippery Successes, Flexible Failures

The essence of innovations is that we don't know whether they will succeed. For a process of innovation to succeed, individual projects must be allowed to fail. And sometimes the definition of success is slippery. If regulatory goals are unreasonable (as they sometimes are), and an agency adopts more flexible ways of accomplishing those unreasonable goals, is that success? If one defines success as the best of all possible worlds, one is sure to be disappointed by both federal and state reforms.

But in the real world, where incrementalism is often the best we can get, even a more efficient way of accomplishing wrongheaded goals is an improvement. At any rate, if failure means environmental degradation--the infamous "race to the bottom"--the evidence suggests it's not likely. The experience with recent innovations in environmental policy indicates that the states are resilient enough to learn from their mistakes, bounce back from failures, and overcome the barriers that stand in the way of better environmental protection.

Many of these barriers are psychological: the attitude among local, state, or federal officials that "the way we've always done it" is the best or the only way. No one likes change, and people often have to be prodded in the right direction. That includes business people as well as regulators. "It's sort of funny," muses Mary Gade of the Illinois EPA. "It's not exactly as if people are flocking to our doors saying, `I can't wait to try something innovative.'" She recalls a senior executive from a company she regulated who said of a flexible compliance program, "I hate this! I want you to tell me what to do!"

Other barriers to innovation are technical, since some environmental variables are difficult or impossible to measure directly. One Nebraska regulator recalls the days of using "dust-ball buckets" to measure particulate matter. The agency would set out a bucket and, after 30 days, measure what was inside, amid the bugs and bird droppings. In an age of widespread, serious environmental problems, such inexactness was acceptable; everyone knew, broadly speaking, what the problems were, and the cost of refining environmental measures was high relative to the payoff. Nowadays, when many major problems have been solved and minor problems are harder to pinpoint, developing accurate performance measures is much more important.

But the barriers that loom largest in environmental policy are institutional, mainly growing out of the relationship between the states and the federal government. Ultimately, the devolution of environmental policy will require changes in federal law.

What functions should the U.S. EPA retain? In 1970, when the EPA was set up, one of the models suggested was the National Institutes of Health: a scientific agency in charge of setting standards, issuing bulletins, and conducting basic research, with the states actually running the programs. Instead, the EPA became a hands-on agency, running all the programs but delegating them under certain conditions to the states. Pennsylvania's Jim Seif believes a strong federal role was appropriate in the 1970s, when major environmental problems were just beginning to be addressed, but he says the time has come for a shift in authority to the states.

The U.S. EPA probably should continue to address environmental problems that affect several states, such as air pollution in the Midwest and Northeast or coordinating water-quality protection in the watersheds of rivers that border several states. It might also take on more of an international role, enter into more public-private partnerships, put more emphasis on scientific research, and encourage the development and transfer of pollution-reduction technology. "Those remain roles that would elude most states in terms of their focus and in terms of their budget," says Seif. "Issuing permits does not elude me. I do more of that than any EPA region....They don't need to occupy the field anymore."

Faithful Incentives

info@reason.com (Alexander Volokh) — Sat, 01 Nov 1997 00:00:00 EST

Over the past couple of decades, analysts studying such religious move-ments as the "consciousness reformation" and the revival of fundamentalism have often assumed they are rooted in changing religious preferences among large groups of people. Yet an article in the April 1997 issue of Economic Inquiry suggests that government policies affecting supply and demand play a role as well. In "Deregulating Religion: The Economics of Church and State," economist Laurence Iannaccone of Santa Clara University and sociologists Roger Finke of Purdue University and Rodney Stark of Washington University analyze several cases.

The emergence of the 1970s consciousness reformation in the United States, which featured the rise of such Asian-inspired "cults" as the Unification Church and the Hare Krishnas, typically has been attributed to the willingness of young adults in the baby boom generation to challenge Western materialism, individualism, and rationalism. Iannaccone and his co-authors instead find a cause for the flowering of Asian religions in the Immigration and Nationality Act Amendments of 1965, which sharply increased the number of Asian immigrants.

And while many observers have blamed economic frustration or reactionary sentiments for the fundamentalist revival of the 1970s and 1980s, the authors instead cite a relaxation of Federal Communications Commission rules. Before 1960, the FCC considered blocks of time a station donated to religious organizations part of a broadcaster's "public service" requirement when deciding whether to renew a station's license; air time purchased by religious groups, however, didn't count. After 1960, the FCC stopped giving preferential treatment to donated religious programming. Broadcasters responded by selling time to the highest bidder, which hurt complacent mainstream denominations and aided charismatic televangelists who could rely on listener contributions.

Most significantly, Iannaccone and his colleagues find that as the level of religious competition in a country increases, church attendance also rises. In Sweden, for instance, the church is state-run, Swedes automatically become church members at birth, and church employees work for the government. While 95 percent of Swedes retain church membership, and 70 percent have their children baptized in the church, only 2 percent attend Sunday services. "The Established Church is like a post office," says the bishop of Sweden. "People don't rush to it when it opens....They are just happy it's there."

Software Pirates

info@reason.com (Alexander Volokh) — Sat, 01 Nov 1997 00:00:00 EST

On July 1, 1997, the Food and Drug Administration arrested a laser. The laser belonged to Trevor Woodhams, an eye surgeon in Atlanta who has been practicing for 15 years and runs the Woodhams Eye Clinic. He uses surgical eye lasers, or excimer lasers, to treat nearsightedness and astigmatism. Woodhams built his laser because the existing, FDA-approved models didn't allow surgeons to perform techniques that are state of the art elsewhere in the world. In contemplating how the FDA might respond, he believed he had two things going for him: First, doctors who build one-of-a-kind devices can be exempt from standard FDA regulation if they meet certain criteria, and Woodhams's lawyer had assured him that the "custom device" exemption applied to him. Second, the FDA has repeatedly said it does not regulate medical practice--device manufacturers, yes; doctors, no.

Which is why Woodhams was a bit surprised in mid-1996, soon after he built his laser, when the FDA told him the custom device exemption didn't apply to him and that, as a regulated device manufacturer, he was violating the law by making and using an unapproved device. To get FDA approval for a device, you need to do studies, and to do studies, you need an investigational device exemption (IDE). Woodhams didn't agree that he was subject to FDA regulation in the first place, but the FDA had more money and more lawyers. "As a private practitioner, I didn't have the resources to fight the FDA on this," he says, "and I figured it was probably better to go along with them."

Woodhams sent in his IDE application in the spring of 1997. The FDA turned him down, as it often does when it's not convinced of a product's safety or efficacy. Many of the FDA's objections stemmed from disagreements over what sort of surgery is acceptable--disagreements bordering on the forbidden territory of medical practice. The FDA also wanted Woodhams to do "profilometry studies," which basically amount to testing the laser on plastic and having the plastic analyzed to make sure the laser and the computer inside it are really doing what they're supposed to be doing. Woodhams didn't think this was necessary--the two companies whose lasers were already approved for the same techniques had never been asked to do profilometry studies--but he sent for the tests anyway.

The FDA told Woodhams not to treat any patients until the IDE was approved and to limit himself thereafter to practices approved in the IDE. He agreed to follow the IDE protocol but said he wouldn't stop treating patients while waiting for IDE approval: It would hurt him financially; he had been doing the procedures for years with full disclosure and without harming patients; and he had patients who were relying on him, some who needed touch-ups, others who'd had one eye operated on and who needed the same work done on their second eye. Woodhams told the FDA he would work with it and submit a revised IDE application.

Then a marshal showed up at his office and put his laser under arrest. "They didn't move it or fiddle with it or chop it up," Woodhams says, "but they put a big sticker on it that said no one could touch it, under order of the U.S. marshal." He called his contact at the FDA. "I thought I was working with you and we were close to a resolution," he recalls saying. "Why was this done?" He asked whether he should send in his revised IDE application as soon as he got the results of the profilometry studies, or submit the incomplete IDE application and send the profilometry results later. The contact wasn't sure whether an IDE was even possible now. After all, Woodhams had no laser.

The enforcement action against Trevor Woodhams was one of the first in a series. The FDA is now actively seeking out doctors and manufacturers who make excimer lasers without the agency's permission. The FDA thinks of this as nothing new; it's been enforcing the Food, Drug, and Cosmetic Act against recalcitrant manufacturers for years. But the excimer laser controversy raises fundamental questions about the FDA's mission. Despite the reformist zeal of the 104th Congress, and despite the resignation of activist Commissioner David Kessler, the FDA's power is expanding, even without new laws or regulations. The key to this expansion is the evolution of technology and the FDA's regulatory control over software products.

Once upon a time, there were drug and device companies, which were subject to FDA regulation, and doctors, who were shielded by the FDA's inability to regulate medical practice. Back then, it was easy to tell which was which. But times change. Today, medical devices are no longer simply physical tools; increasingly, they are technologically savvy gadgets with sophisticated software that can interact with patients, diagnose diseases, and administer treatment. The manufacturer can almost be seen as a second doctor. As technology brings drug and device companies into the realm of medical practice, it brings medical practice closer to the jurisdiction of the FDA. Without any changes in the law, the FDA's purview is growing.

The FDA, which has been regulating food and drugs since the turn of the century and medical devices since 1976, has tried to regulate software since the mid-1980s. If you are asking yourself how software can be a medical device, the FDA has anticipated your question. "Well, you may be asking yourself, how can software be a medical device?" said Dr. Bruce Burlington, head of the FDA's Device Center, during a software policy meeting at the National Institutes of Health in September 1996. According to the law, a medical device is an "instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent, or related article, including any component, part, or accessory...intended for use in the diagnosis of disease or other conditions, or in the cure, mitigation, treatment, or prevention of disease, or intended to affect the structure or function of the body."

No one was thinking of software in 1976, when the Food, Drug, and Cosmetic Act was amended to cover medical devices; the FDA came to device regulation not because of bad software but because of defective IUDs. But with a definition that broad, all software used for medical purposes, or used to make a medical device, is presumed to be a device, and subject to regulation, unless the FDA specifically exempts it. This can include the software in pacemakers, systems that track blood donations, expert programs to evaluate X-rays, even databases of medical literature that aid doctors in determining prescriptions. It can also include the software that controls excimer lasers. Call us "the Food, Drug, and Software Administration," Burlington pleasantly suggested. "As we sit there and look at our floppy disks and try to figure out what to make of them, it is a conundrum for us."

So far computers in medicine mainly have been used to control devices, but Dr. Harry Burke, an assistant professor of medicine at New York Medical College, thinks their use will expand dramatically. In the future, he says, medical software will deal with pattern recognition, risk assessment, diagnosis, and medical data management--for instance, programs that read Pap smears to determine which slides need human review and which don't. "This is a gigantic area," Burke explained at the NIH conference. He predicts that if the FDA takes an expansive view of what software can be considered a "medical device," new medical software applications will outnumber new drug applications in 10 years, and will be "an order of magnitude greater" in 20 years. "Regulating all of this domain is obviously impossible," he says.

Impossible or not--and for better or worse--the FDA claims jurisdiction. When Intel announced the mathematical flaws in its Pentium chips, the FDA made all device manufacturers using Pentiums do a safety analysis on their products and take "appropriate mitigating steps" so the chip's problems didn't affect the devices. Blood banks have also been affected. Blood bank management software is used to track units of blood from the time of donation. It keeps a record of testing results, remembers the donation time of each unit to avoid giving someone spoiled blood, keeps track of the blood center's entire inventory, and records whether any adverse effects were observed from a transfusion. Since the late 1980s, blood banks have had to make sure their computer systems comply with "good manufacturing practices" (GMPs), a set of vague FDA recommendations. Vendors of blood bank management software have to get FDA premarket clearance and are subject to inspections if the FDA thinks their software could have contributed to the release of tainted blood.

Preventing the use of unsuitable blood is, of course, all well and good. Leonard Wilson, chief of the FDA's biologic devices branch, points out that HIV-positive blood can kill a recipient within several years, and a mismatch between AB and O blood can kill a patient within 15 minutes. In fact, the FDA became an active blood cop only after being browbeaten by Rep. John Dingell (D-Mich.) several years back about injuries caused by bad blood-bank software.

But the FDA has created some bad blood of its own because of its approach to regulation. The Health Industry Manufacturers Association has called the regulatory process a "very, very long and arduous operation for blood bank systems vendors"; the Red Cross and the American Association of Blood Banks agree. Blood management software manufacturers find they can't submit the new version of their software to the FDA, because the agency, never one for haste, hasn't approved the old version yet. Knowing the hoops they'll have to jump through, software manufacturers are less inclined to enhance their products in the first place. One blood expert, noting "the dearth of modern freestanding software in blood banking," has forecast "doom for quality software" unless regulations are relaxed. That may be a bit hyperbolic, but this is blood we're talking about. Blood banks use software to reduce human error by automating or verifying manual processes. Better software improves the blood supply; slowing the process down could cost lives.

The FDA disputes the industry's complaints. "While we do have some software that has taken a long time to clear, we did clear one package in 22 days," Wilson recalls. "We felt very good about that. That doesn't get in the way of any innovation at all." Still, even low-risk device approvals often take a long time, in many cases exceeding the maximum set by the law. At any rate, since blood bank regulation has never been subjected to a cost-benefit analysis, there is no way of knowing whether, on balance, hazards associated with blood have been reduced; if so, by how much; and at what price.

The effects of software regulation are as pervasive as the use of medical software itself. Dr. Martin Weinhous, chief medical physicist in the radiation oncology department at the Cleveland Clinic in Ohio, once used a software program developed by another medical physicist to set up patients for breast cancer X-ray therapy. In X-ray therapy for breast cancer, the affected tissue can be irradiated from three different directions, and to avoid overdosing or underdosing the patient, the doctor has to be sure that there are no gaps or overlaps of the X-ray beams. Once the doctor knows which treatment machine is to be used, and what the patient's measurements are, he can figure out where the patient should be positioned and how the beams should be directed. But this calculation, when performed manually on a calculator, is tedious, error-prone, and time-consuming, taking up to half an hour. The software shortens the calculation to one or two minutes. The program got FDA clearance, Weinhous wrote in a paper delivered at the NIH conference, but as it evolved, "the FDA began to require more of its creator. Eventually, the FDA required that [the developer] test his software tool against every possible PC and Macintosh configuration, even though the inherent risk is small. Faced with unrealistic GMP requirements, he ceased manufacturing of the device. So we in radiation oncology have no choice but to continue to use a less sophisticated and more error-prone method."

Software developers also feel the costs of FDA regulation. Frank Houston, a software validation consultant with Taratec Development Corp. in Bridgewater, New Jersey, tells the story of a company "who shall remain nameless" that sells software to keep copies of medical images for insurance purposes. Insurance adjusters use the pictures when deciding whether a claim was justified, but because an X-ray scanned into the computer isn't as good as the original X-ray, doctors are advised not to use the computer images to diagnose disease. In fact, the software constantly displays on the screen, "Not approved for diagnostic use." After about two hours of telephone calls to various parts of the FDA, Houston and the company decided the program might qualify to escape regulation. But the gray areas of device regulation are large enough that they decided they'd better file for FDA clearance anyway. The manufacturer spent weeks preparing the documentation, and the FDA has been sitting on it for a year. All this "for a product," says Houston, "that, in the end, lacks any significant risk to health. Something's wrong with this picture."

All this should have been expected. Software, unlike most physical devices, evolves rapidly and is sometimes changed daily, according to the user's needs. The FDA, on the other hand, takes its time. It began talking about software regulation in 1985. The first written draft policy came out in 1987 and was revised in 1989. Once the guidelines were finally out, the floodgates did not open; the approval process is inherently unsympathetic to quick innovation. The most routine form of FDA approval for low-risk devices is called the "510(k)" or "premarket notification," and it is reserved for products that are "substantially equivalent" to those already on the market. Imagine telling a
software developer that to be easily introduced into the U.S. marketplace, its product had better be the same as or based on an existing program. "It's patently obvious that any agency that requires congressional approval is not going to move faster than market-driven technologies," says Avrohom Gluck of Neuromedical Systems, a Pap smear screening device company in Suffern, New York. "The agency has been, and still is, severely handicapped in that they need to regulate in the face of many in both government and industry who understand neither the technology nor the quality systems needed to ensure public safety."

It doesn't help that software is not like drugs or even like most traditional devices. Drugs are approved for "safety and efficacy" in treating particular diseases. But this is less true for devices, and much less true for software, which is often used for many different tasks. Nancy George, of Software Quality Management, a Towson, Maryland-based consulting firm that assists companies with regulatory compliance, describes a device that lets patients do their own testing at home, collects and transmits data 24 hours a day, makes video home visits, generates hospital-like charts, and even teaches the patient. "It does everything but serve coffee," George explained to the FDA. "Is it record keeping? Is it training? Is it telemedicine? Is it critical?" Concludes Harry Burke, the New York Medical College professor, "Really, what we've got is a can of worms. I mean, it could get really dicey here if we're not careful."

Because software evolves rapidly and has 1,001 different uses, it is particularly easy to stifle through regulations that are just a bit too inflexible. And because software changes constantly, it is never perfect, though it is often vastly superior to the manual, paper-based processes it is meant to replace. Imperfection has never sat well with the FDA, which gets a great deal of bad publicity if something it approves hurts someone but none at all if someone dies because of regulatory delay. Accordingly, the FDA dreams, in the words of T.S. Eliot, "of systems so perfect that no one will need to be good."

After 12 years of software regulation, the FDA admits that its efforts have "not been completely successful." FDA officials have toyed with regulating software differently according to whether it's in source code or executable code. As anyone who knows anything about software could have told them, source code can be easily converted into executable code, so that distinction makes no sense. The FDA has also tried to regulate software differently depending on whether it's distributed for free or for profit. Such a distinction has nothing to do with risk, which is the only conceivable justification for the FDA's existence. The FDA is now trying to reinvent its software regulations. The rules are in flux or, as one NIH conference participant put it, "loosey-goosey."

While software regulation may be loosey-goosey, there are certain constants in the FDA's approach. One of them is the agency's ongoing crusade against "off-label uses" of drugs and devices. Drugs and devices are approved and labeled for particular uses. The FDA doesn't just approve, say, AZT or excimer lasers. It approves AZT for the purpose of treating patients with HIV, or excimer lasers for the purpose of performing certain procedures to correct nearsightedness. Drug companies can advertise and label approved drugs only for approved uses. But once a drug is approved, a doctor can prescribe it for any use, on- or off-label. The FDA hates that. What's the use of demanding clinical trials proving a drug's efficacy in treating a particular condition if a patient can then go and take the drug for a different condition?

The FDA has a long history of fighting off-label use of medicines. When Congress passed the 1938 Food, Drug, and Cosmetic Act, it made it clear that once a drug was approved, consumers could buy it over the counter, with or without a prescription. Disregarding Congress's intent, the FDA carved out a category of drugs that are available only by prescription, and it tried to limit doctors' ability to prescribe drugs for uses not approved by the agency. In 1951 Congress upheld the prescription-only rules but reaffirmed that the FDA couldn't control what doctors prescribe. Even in 1962, when the FDA was given sweeping new powers over drugs, Congress stressed that the agency could control consumers and manufacturers but not doctors.

Congress attacked the FDA anyway in 1971 for not doing more to protect consumers from off-label uses of prescription drugs. In 1972, the FDA proposed criminalizing off-label prescriptions. The FDA's creative theory was that prescribing a drug for unapproved uses adds to the drug's "label"--a metaphysical construct that goes beyond the paper wrapped around the bottle--and since the new "label" has no instructions for the new use, the drug is then "misbranded." And naturally, there's no way to fix the (real) label to reflect the new use, since only FDA-approved information can go there. Doctors protested, arguing that off-label prescription is fundamental to sound medical practice. The FDA backed down. To this day, once a drug is approved, it is up to the doctor and patient to use it properly.

Excimer lasers are now caught in the off-label controversy. They have been approved for phototherapeutic keratectomy (PTK), which is used to treat diseased, scarred corneas. They have also been approved for photorefractive keratectomy (PRK), but only to treat certain degrees of nearsightedness and some forms of astigmatism. In other countries, the best refractive surgeons use PRK to treat farsightedness and a wider variety of astigmatisms. These surgeons also use excimer lasers to perform a procedure called LASIK (laser-assisted in situ keratomileusis), which is essentially the same as PRK but performed inside the cornea instead of on the surface. Many surgeons prefer LASIK to surface PRK because it can lead to less regression and scarring. The FDA only recently (in July 1997) gave its final, conditional approval to LASIK.

If excimer lasers were drugs, doctors would not care that these other uses were not approved. They would simply buy the drug and use it for whatever purpose they thought best. But excimer lasers are not drugs. They are devices that include software, and the software itself is considered a device. John Calfee, an economist at the American Enterprise Institute, explains the implications: "Imagine that the oncologist using a combination drug therapy uses a computer-controlled device to administer the drugs. Suppose the computer software determines all dosages, and does so according to settings provided by the physician. Now suppose that when the FDA approves the drug-administration device for marketing, it also approves the software in every detail. If the FDA forbids physicians or others from reprogramming the device, it could effectively tell doctors how to administer the drug and could even exercise considerable control over which kinds of patients receive the drug and even which illnesses are treated."

Consider how this sort of thing happens with excimer lasers. Only two companies are approved to sell excimer lasers in the United States: Summit Technology of Waltham, Massachusetts, and VISX of Santa Clara, California. When the FDA approved Summit's and VISX's excimer lasers, it mandated that the machines be activated by a keycard, available from the companies, that allows only approved software to be loaded. These keycards, which cannot be used more than once, cost $250 per operation and are available only from the laser manufacturers. The $250 royalty goes to a company called Pillar Point Partners, which is owned by Summit and VISX. In effect, the FDA has not only established a duopoly, in which Summit and VISX are the only companies allowed to manufacture excimer lasers, but has also enshrined a royalty payment system as part of the approved laser design. Some suspect the FDA is in the pockets of the laser manufacturers, but the FDA's explanation is also plausible: This is a convenient way to restrict the software that can be used with the lasers. As long as correction of nearsightedness and some forms of astigmatism are the only approved uses for the laser, the keycards will allow you to load software only for those procedures.

The FDA claims this is not regulation of medical practice. Using an approved device for an unapproved use is medical practice, but using an unapproved device is just illegal, and always has been under the FDA's device approval authority. The laser-plus-nearsightedness-software is an approved device; the laser-plus-farsightedness-software is an unapproved device. FDA software restrictions, therefore, are entirely appropriate. Says FDA spokeswoman Sharon Snider, "If a product can't be used any other way because that's all the software is programmed for, that's all [the doctors] can use it for. That has nothing to do with FDA restricting the practice of medicine."

Nothing to do with restricting the practice of medicine? Only if you're fixated on technical definitions. Regulating the choices of medical practitioners means restricting the practice of medicine, whether it's called "off-label use" or "using an approved laser with unapproved software." The software, by FDA approval, sets the treatment area at a diameter of six millimeters, though this may not be the best size for all patients. Also by FDA approval, the software will not allow a doctor to change the curvature of the eye by more than six diopters, a limit that would exclude people with the worst cases of nearsightedness. This is not restricting the practice of medicine?

Imaginative doctors can get around some of the restrictions. Operating on eyes with the LASIK procedure was possible (but far from ideal) before LASIK was approved, though companies couldn't advertise that fact and doctors couldn't load LASIK software into the laser. Also, it's possible to change the curvature of the eye by more than six diopters by running the program twice, though this, too, is not ideal: It costs twice as much, since it requires two keycards, and the patient has to sit there with an exposed eye while the machine is configured a second time.

But even the most imaginative doctor's options are limited by the available software. Treating farsightedness, for example, is extremely difficult, though not unheard of. "I think you have to be a pretty brave, committed soul to do some of these new and innovative things, what with the FDA looking over one shoulder and the plaintiffs' attorneys looking over the other," says Trevor Woodhams. Dr. Stephen Trokel, who spoke to an FDA panel in July 1996 on behalf of the American Society of Cataract and Refractive Surgery, reported that "the current micromanagement by the FDA of innovations in refractive surgical technology encourages `offshore' investigations, encourages the movement of patients to foreign surgical centers, encourages the proliferation of unregistered, noncommercial, and totally unregulated lasers, and, most importantly, encourages the development of combination surgery where arcane and untested, imaginative mixtures of surgical techniques are created to overcome FDA labeling."

Trokel's warning is neither speculation nor hyperbole. Vagueness and inconsistency are hallmarks of FDA eye laser policy. It doesn't take a refractive surgeon to recognize this, though many refractive surgeons have firsthand experience in the matter. Because small details change the most and are the hardest to get a handle on, the desire to regulate small details will lead to a constantly shifting legal regime, with FDA interpretations changing unpredictably based on ever-changing medical technology. Many doctors and manufacturers don't know whether they're covered by the law. Some doctors who feel their medical practice is being restricted by the software lockouts have taken to re-importing "gray market lasers"--lasers made by Summit and VISX for export, which neither require royalty keycards nor have the software lockout. Others, like Trevor Woodhams, have created "black box lasers" or "garage lasers"--basically, homemade lasers, constructed out of readily available components.

The FDA believes these lasers do not fall under the "custom device" exemption. "A custom device basically is a product made for use on one person," says the FDA's Snider, echoing the definition easily found in the Code of Federal Regulations, Title 21, Part 812, Section 3, Subsection (b)(5). Once you use the laser on multiple patients, she says, "there's no way that would be considered a custom device." Some doctors point out that since a laser's software must be reconfigured with the statistics of each patient, the devices--the hardware-plus-software combinations--really are individualized.

Woodhams, whose laser is under arrest, feels the FDA has treated him unfairly. He invested $350,000 in his laser and is still paying off the bank loans. Now he has to take his patients to an outside surgery center, which is inconvenient and requires him to pay the $250 royalty to Pillar Point Partners. The Summit and VISX lasers can treat a smaller range of conditions than Woodhams's own laser, which is why he built it in the first place. He had been getting customers turned away by other eye surgeons; now he, too, has to turn those customers away. The FDA enforcement action has doubled his costs per operation. "I felt like I was dealing in good faith in a gray area," he says. "I felt like they did not return the same good faith in their treatment of me."

Besides making unwitting criminals out of justifiably confused doctors, the irrationality of FDA policy encourages doctors and manufacturers to evade the law. Some surgeons have been buying lasers from unapproved manufacturers. On June 11, the FDA requested that U.S. marshals seize nine excimer lasers made by Photon Data of Winter Park, Florida. Surgeons were using Photon's lasers for PRK to treat nearsightedness. The offending equipment, which had a combined estimated value of more than $3 million, was seized at two Photon Data locations and at a private freight forwarder. Dr. Jui Teng Lin, the company's president, did not return my phone calls, but Woodhams, who knows of Lin's outfit, says Lin was building excimer lasers using the very newest technology, selling them to individual practitioners in the United States and abroad, and helping his domestic customers get investigational device approval from the FDA. "Personally," Woodhams says, "I don't think there was anything objectionable with what he was doing."

The FDA's Snider says neither Photon's nor Woodhams's lasers have been linked to any injuries, though the agency has received unsubstantiated reports of injuries related to laser eye surgery and is trying to learn more. In short, the FDA showed that it cares about hypothetical patients who might be hurt if the lasers remained in use, but it showed no consideration for the patients who could have been helped. The FDA did not show that it prevented harm, on balance, by seizing Photon's lasers, and the law does not require it to do so.

In a sense, what the FDA is trying to do now was contained in its mandate from the start. We just didn't know it at first, because limited technology made the scope of the FDA's power seem smaller than it really was. Now we know. As AEI's John Calfee puts it, "FDA regulation expands even when it seems to be standing still....It is now clear that in the absence of new legislation, the FDA of tomorrow will be more inclusive and more intrusive. To regulate more, the FDA does not need to expand its regulatory domain. It can preside over a spontaneous explosion in regulation, confident that expanding medical technology will move more and more of medical technology and medical practice into the boundaries of FDA regulation."

For years, both critics and supporters of the FDA have assumed that deregulation would reduce the agency's power. "Well, in our country," they figured, as Alice told the Red Queen in Through the Looking-Glass, "you'd generally get to somewhere else--if you ran very fast for a long while as we've been doing." The Red Queen's answer suggests the truth may be more complex than that: "A slow sort of country! Now, here, you see, it takes all the running you can do, to keep in the same place. If you want to get somewhere else, you must run at least twice as fast as that!" And so it is with FDA reform. The FDA must shrink just to stay the same size.

Tastes Great! More Polluting!

info@reason.com (Alexander Volokh) — Mon, 01 Jan 1996 00:00:00 EST

Environmental agencies used to consider beer brewers good people. The EPA thought brewers emitted only tiny amounts of volatile organic compounds (VOCs), an air pollutant. But Coors Brewing Co. discovered otherwise. Coors conducted an 18-month, $1.5 million environ mental audit that found that the beer-making process is about 17 times more polluting than the government thought it was. The VOC emissions Coors found weren't addressed in the permits of any major American brewer.

Coors voluntarily revealed this information to the Colorado Department of Health, which promptly fined the company more than $1 million for violating state air pollution laws. The fine was later reduced to $237,000.

Contrary to popular belief, many environmental problems are neither readily apparent nor well understood; it's not as if VOCs exude an eerie, yellow glow. And yet, companies are afraid of prosecution or citizen lawsuits if they do the very audits needed to find environmental prob lems. According to a Price Waterhouse survey of the companies that do environmental audits, more than 45 percent said that they don't want to expand their auditing program because the information could be used against them. As one senior official with the EPA put it, "No good deed goes unpunished."

Coors's experience paved the way for one of the first "environmental audit privilege" laws in the country. Under a typical environmental audit privilege law, audit reports can't be used as evidence in judicial or administrative proceedings as long as violations are reported to the au thorities and promptly corrected. Fourteen statesArkansas, Colorado, Idaho, Illinois, Indiana, Kansas, Kentucky, Minnesota, Mississippi, Oregon, Texas, Utah, Virginia, and Wyominghave audit privilege laws, and bills are pending in most other states. At the federal level, two audit privilege bills, S. 582 and H.R. 1047, are hanging out in committees.

The EPA opposes the laws because they make life tougher for environmental law enforce ment. EPA Administrator Carol Browner says the agency may increase enforcement in states that have audit privilege laws and take back some of the environmental programs delegated to state governments.

The EPA's own policy is to be lenient with companies that audit themselves and attempt to fix the problems. But the policy isn't binding on the agencyor on the Department of Justice or the U.S. attorneys' offices, which do the actual prosecutions. Nor does it protect companies from citizen suits. And it doesn't prohibit the taking of testimony about the audit reportwhich makes the protection of the actual report more or less irrelevant.

Nature's Nature

info@reason.com (Alexander Volokh) — Sat, 01 Jul 1995 00:00:00 EDT

A Moment on the Earth: The Coming Age of Environmental Optimism, by Gregg Easterbrook, New York: Viking, 745 pages, $27.95

In the minds of certain environmentalists, the environment is a grand term, which encompasses the entire universe. Except for man. In "the environment," species can prey on others and gain at other species' expense. Only man is judged by a different standard. "The environment" is peopled with intelligent-seeming creatures, such as dolphins, monkeys, and beavers, which use tools, build structures, and have some understanding of the world around them. Man alone is denied this dignity. True, there are reactionaries in human society who believe that man, by virtue of being a rational being, has certain inalienable rights, and that people should be able to keep what they produce and associate with others for mutual benefit. But the environmental movement scoffs at such notions. Only "the environment," which has no values, has rights--and those are inviolable.

As Gregg Easterbrook points out in A Moment on the Earth, mystical notions of the environmental movement do no good, either to ourselves or to the earth. What we need, he says, is a healthy dose of "ecorealism." "The core principles of ecorealism," he tells us, "are these: that logic, not sentiment, is the best tool for safeguarding nature; that accurate understanding of the actual state of the environment will serve the Earth better than expressions of panic; that in order to form a constructive alliance with nature, men and women must learn to think like nature."

Former EPA chief William Reilly has called A Moment on the Earth "the most influential book since Silent Spring," the Rachel Carson work that launched the apocalypse-mongering environmental movement. Given the sort of press Moment has been getting, Reilly's encomium may be correct.

Easterbrook, a contributing editor of Newsweek and frequent presence in The Atlantic Monthly, is a prominent neo-liberal who has distinguished himself by, among other things, being the only major writer to vocally praise the Canadian health care system. With this book, though, he sets himself apart from the mainstream environmentalist movement, which has gotten bogged down in Chicken Little tactics and divorced from most Americans' vision of environmental protection. Yet he has no kind words for conservative anti-environmentalists (whom he calls "unviros"). Accordingly, the book is guaranteed to be either praised or panned by every TV show, newspaper, and magazine worth its salt--and sometimes both praised and panned simultaneously. (See, for instance, this article.)

The first myths Easterbrook takes on are the easiest to attack--claims that are factually false. The environments of Western countries have been getting cleaner at the same time that most people think they've been getting more polluted. Judging from current trends, pollution in the Western world will end within our lifetimes. Most people think that developed countries are the environmental rogues, but in fact they're much cleaner than developing nations. Runaway global warming almost certainly won't happen. Same goes for scary ozone depletion scenarios and most other feared catastrophes. American forests are expanding. Technological progress is a good thing: Most new technologies are more efficient, use fewer resources, produce less waste, and cause less ecological disruption than old ones.

Myths based on bad facts can only be countered with good ones, of which Easterbrook has plenty. Asbestos, Alar, DDT, and PCBs--poisons of man--are no more dangerous than arsenic, cadmium, and lead--poisons of nature. We've got 128 million more acres of forests today than we did in 1920, and paper-company-owned-and-managed forests have more biodiversity than the revered old-growth forests. Factories are more sustainable than subsistence agriculture. There's no clear relationship between how close you are to toxic wastes and whether or not you'll get cancer. Air quality in major urban areas is getting better, not worse; ozone (the bad kind), a major air pollutant, has gone down 40 percent since 1970 in Los Angeles, even as the car population has tripled.

Then there are the subtler myths about the nature of the environment and the relationship between man and nature. The most pervasive one is that nature is fragile. It isn't: "Were the environment fragile it would have expired many eons before the advent of the industrial affronts of the dreaming ape. Human assaults on the environment, though mischievous, are pinpricks compared to forces of the magnitude nature is accustomed to resisting," writes Easterbrook.

Two corollaries to this myth are the "environmental correctness" and the "stop-in-place" myths: the idea that there is a correct environment and that if only we preserved nature, it would stay that way forever. But there's no such thing as the "correct" environment; "every environment and habitat comes into existence fated to end," Easterbrook reminds us.

Another widespread myth is that nature is benign. It isn't, and is certainly worse than people. "Flooding land to make the James Bay power reservoirs unquestionably kills a tiny percentage of the plants and animals of subarctic Quebec; the Laurentide ice sheet once killed 100 percent of the surface creatures that lived there," says Easterbrook. As mothers go, Mother Nature has more in common with Joan Crawford than Donna Reed.

The worst myth, though, is that there's a conflict between the artificial and the natural. There isn't. Artificial chemicals are made of the same stuff as natural chemicals. To condemn a substance, we have to know what it does. Whether it comes from a forest or a factory is immaterial. And there's no inherent conflict between man and nature. "To reject the human presence as unnatural evinces fundamental misreading of the character of the living world," Easterbrook charges. "Humankind springs from the natural scheme just as does any beast or plant."

Easterbrook is right on target here in his enviro-bashing. The news on all of the traditional environmental problems is almost uniformly good, and yet environmentalists talk as if we're doomed. "Is everybody talking about the same world?" he asks.

But Easterbrook often misses the mark. For instance, he has an incomplete understanding of the notion of trade-offs. In reality, you can't always get what you want; policies have unintended consequences and plans designed to help can end up hurting. Sometimes, Easterbrook knows this: "Certainly it is possible to become oversensitive to environmental protection and spend more than necessary, given society's other needs....Asbestos regulation costs up to $49 million per premature death avoided. This sum adds a hypothetical few years to the ends of a few people's lives, when the money might be invested in education, health care, crime prevention, or other social needs with much better paybacks."

At other times, though, Easterbrook talks like this: "Toxics cannot possibly be good for us or the ecology. That's all we really need to know to justify a goal of zero toxic discharge." Easterbrook qualifies himself with phrases like "wherever practical," which are always correct and usually unhelpful. He never tells us how we figure out when something is practical (or why government knows better than individuals when something is practical). He doesn't tell us why toxics aren't good for us. It seems to need no proof, but it does, mainly because it's not true--everything is dangerous at some dose and harmless at another. And while Easterbrook recognizes that there's no inherent difference between natural and synthetic chemicals, I can't imagine him advocating "zero natural chemical production."

In economics and the environment, Easterbrook likes the "reasonable"--that which is "attainable politically and bearable economically." Reasonable and bearable are more words that mean less than they seem; they don't even tell us whether we're moving in the right direction.

And Easterbrook is only selectively pro-moderation. With acid rain, Easterbrook defends the EPA for seeking only moderate air emissions reductions. But he whistles a different tune on the pesticide Alar. He concedes that the case against Alar was based on shoddy science. But "society is better off without Alar" because "Alar was used mainly to make apples extra red instead of only sorta red, and who really cares about that?"

Well, apple buyers seem to care about that, and so do apple growers. I'm more likely to buy a bright red apple than a dull red apple. Alar also inhibited the growth of some bad apple fungi, which are worse for your health. So eliminating Alar may have actually harmed the public health
by giving us fewer and more dangerous apples. But you wouldn't know it from this book. Easterbrook also likes that the Alar flap made the EPA more responsive to the public. Not a word on whether it's a good thing for agencies to be more responsive to public hysteria over nonexistent threats.

Easterbrook grants that scientists don't know what causes cancer or whether a 1-in-10,000 risk is better than a 1-in-1,000,000 risk. But since toxics are obviously bad, the question is merely: "How much protection can we afford?" In other words, it's always good to eliminate even the most hypothetical threat, as long as it doesn't plunge us into a depression. No talk of what's a negligible risk; no talk of balancing costs and benefits; no talk of whether growers have a right to use pesticides and let those who don't like it buy organic. Moderate? Reasonable? Hardly.

There's a deeper flaw here. Easterbrook can't answer a basic environmental question: "How do you know when something is bad for the environment?" According to Easterbrook, there are "a wide range of human actions careless, selfish, or destructive to the environment." That's a statement that few would argue with. But what is that wide range of actions? To Easterbrook, things are bad for the environment when they harm "the integrity of nature."

Of course, just saying that is of no help. A radical environmentalist like Bill McKibben might say that any rational human act harms the integrity of nature, because a) we're not part of nature, b) nature is random and spontaneous, and c) nature is fragile. Easterbrook can't say that, since he's rejected all three points of that philosophy. We're part of nature, rationality is our natural gift, and nature is robust. Phrases like "the integrity of nature" should be especially problematic for Easterbrook, with his tirades against the myth of Environmental Correctness. If nature has no proper state, how can you tell when it's doing badly?

Easterbrook's answer is subtler than the radical environmental notion, and, in a way, less satisfying. To say that an action toward nature is "wrong" requires a set of values by which to judge which actions are "right" and which ones are "wrong." Easterbrook's approach is to derive values from nature by "thinking like nature." He reveals his grand scheme of the universe in such statements as: "All impertinent actions by genus Homo combined have yet to produce anything approaching the environmental damage nature inflicts on itself on a recurrent basis." Even nature can do bad things. "Natural" values may be derived from nature, but even nature doesn't always follow them.

This exercise reveals more about himself than about nature, because what he's doing is reading his favorite values into nature. Whatever Easterbrook likes, nature is "striving for"--life, cooperation between species, self-awareness. For instance, "acquiring consciousness is what nature has been up to these 3.8 billion years." Whatever he doesn't like is a "structural flaw"--death by natural catastrophe, death by predation, death by disease, competition between species, the eating of meat (especially veal).

Of course, by choosing the right structural flaws, one can prove anything. For instance, he says, "To nature the circumstances of this solar system must seem fundamentally wrong. Nature wants life: On our world nature has shown unmistakably that it wants the maximum amount of the ecology to live." But suppose I said the opposite: "To nature the circumstances of Earth must seem fundamentally wrong. Nature abhors life: In the rest of the universe nature has shown unmistakably that it wants nothing but inanimate objects." Which statement is more correctly derived from nature?

In short, you can't derive values from nature without contaminating them with your own values. Easterbrook makes his personal values clear from the beginning: "The first round of environmental investments did not fail; they worked, which is a great reason to have more. I consider this glorious if only because as a political liberal I long for examples of government action that serve the common good. The extraordinary success of modern environmental protection is such an example: perhaps the best instance of government-led social progress in our age."

Easterbrook's vision of social progress generally is a government-led one. Cooperation is better than competition; let's alter animal genes to make them live in harmony! Eating vegetables is better than eating meat; let's produce synthetic meat! Killing is bad; let's change human genes to eliminate killing! (Of course, he qualifies himself: "[I]nstitutions of government must be reformed to the point of being consistently benevolent...before anyone in his or her right mind would endorse tinkering with the human gene line.") We shouldn't expose our children to pesticides that only make apples really red; let's remove Alar from society! Despite its declared goal, A Moment on the Earth isn't a study in how to think like nature; it's a study in how to think like Gregg Easterbrook.

It's possible to construct a system without such contradictions. For instance, a viable environmental philosophy could be based on the following notion: "Man is part of nature. Nature has no thoughts, feelings, or values. Therefore, we should do what we think is best, without regard for whether nature wants it. Our actions should be based on a certain theory of rights and a vision of the good life." Such a vision needn't be anti-nature. For instance, if you believe in preserving species diversity or ancient forests, you can protect them and try to build a society that will do the same.

But if you want to protect species and discourage industrial civilization--or whatever your vision is--you should advocate it because you think it's a good idea. Bringing in the fiction of "thinking like nature" is merely an excuse for reading your values into nature and cloaking them with the veil of objectivity. Easterbrook is unwilling to drop the fiction, and his book, while at times factually interesting, is ultimately unconvincing.

Clinical Trials

info@reason.com (Alexander Volokh) — Mon, 01 May 1995 00:00:00 EDT

They say that whenever someone sued the FDA in the early '70s, Peter Barton Hutt, the FDA's chief counsel, would go into court and say, "The Food and Drug Administration is the expert scientific agency charged by the U.S. Congress and the president to protect the safety of pregnant women and small children." At that point, the case was effectively closed.

This story isn't true, but it might as well be. The FDA has been called "the agency that never loses." It almost never gets challenged, and when it does, it almost always wins. It's big. It's usually challenged on questions of fact and not on questions of law, which makes judges defer to it most of the time. It uses complicated words from science. It has the taxpayers paying its legal tab. It's going to be around for the rest of your company's life. And it never forgets.

There are two struggles going on for the soul of the FDA. The first is the debate over what the law should require the FDA to do, a debate that has intensified with Republican control of Congress. The FDA is consistently overconservative. It keeps life-saving drugs and medical devices out of the country and approves others only after interminable delays.

Tens of thousands of Americans die every year because they don't have access to the necessary medical technology. Consider the following estimates:

* Seven thousand people die every year because the FDA hasn't approved the Ambu CardioPump, a CPR device that is available in just about every other industrialized country.

* Nine hundred people die every year because the FDA hasn't approved the OmniCarbon heart valve, which also is in use just about everywhere else.

* From November 1988 to May 1992, about 3,500 kidney cancer patients died waiting for the FDA to approve the drug Interleukin-2, which was already available in France, Denmark, and seven other European countries.

* In 1988 alone, between 7,500 and 15,000 people died from gastric ulcers caused by aspirin and other nonsteroidal anti-inflammatory drugs, waiting for the FDA to approve misoprostol, which was already available in 43 countries.

* And 22,000 people died between 1985 and late 1987 waiting for streptokinase, the first drug that could be intravenously administered to reopen the blocked coronary arteries of heart-attack victims.

People may well come to the United States from other countries to take advantage of advanced surgical techniques and avoid waiting lists, but when it comes to things
under FDA jurisdiction, like drugs and devices, it's Americans who travel abroad. The FDA's caution and delays are also driving many companies to other countries. From 1992 to 1994, for example, Medtronic, a major medical-device manufacturer, moved 12 new businesses or new product lines to Europe, including its $40 million corporate ventures R&D group. And the Irish Bio Tech News reports that Ireland is now home to more than 40 expatriate American medical-device companies, employing 8,500 people, and that 10 more American companies are building facilities in Ireland.

Forty-five percent of device manufacturers say they want to move abroad. Newt Gingrich has called the FDA the "number one job killer in America." Joel Nobel, president of ECRI, an independent medical-device testing company, predicted two years ago that "it is unlikely that it will take Congress and [FDA's Device Center] more than another five years to destroy much of the U.S. medical device industry." Since the Republican takeover of Congress promises tougher scrutiny of the agency, Nobel no longer urges device manufacturers to emigrate immediately. But he remains wary.

Nobel explains how Congress sets FDA medical-device policy: "The theoretical American patient, beloved by Congress and consumer advocates, that they wish to protect from an avaricious industry and uncaring health-care community is a wonderful abstraction beloved, as well, by the media. But real patients hurt, bleed, and die for many specific reasons, which manufacturers and the health community address in detail. Those details are not understood by Congress and the FDA, and political ideology keeps consumer advocates from seeing technical issues in perspective.

"To Congress we must say that our road to hell is paved with your good intentions and that we understand your formula. First, require that the FDA do the unwise or impossible. A few years later, ask the General Accounting Office to tell you if the FDA is doing the unwise or impossible as instructed. Express shock and surprise when you learn that it is not. Hold hearings to pistol-whip the FDA and industry in order to support the passage of more unwise or impossible-to-implement legislation. Do not forget to include testimony from patients whose demonstrable suffering can be attributed to the FDA and industry derelictions. Be sure to use a few exceptional industry sins to justify collective guilt and punishment. Never allow testimony by knowledgeable witnesses who may disagree with your preordained conclusions and already-written legislation, unless they represent industry and can be portrayed as self-serving and mercenary."

FDA partisans have a one-word answer to such criticisms: thalidomide. In the early 1960s, thousands of European babies whose mothers had taken the sedative thalidomide were born with birth defects. FDA enthusiasts claim that it was only thanks to Dr. Frances Kelsey of the FDA and her stubborn questioning that thalidomide stayed out of the United States. But what this really means is that the FDA was already powerful enough to stop potentially dangerous drugs. Since the thalidomide scare, however, FDA has grown more powerful--and more deadly.

In 1962, Congress passed the Kefauver-Harris Amendments to the Food, Drug, and Cosmetics Act, which required that the FDA test all drugs for efficacy, as well as safety, before approving them. In 1976, because of problems with the Dalkon Shield IUD, Congress passed the Medical Device Amendments. These effectively extended the same requirements to medical devices--a broad category covering everything from pacemakers to Band-Aids. In 1990, because of defective heart valves and controversy over silicone-gel breast implants, Congress passed the Safe Medical Devices Act, which further restricted medical devices. More legislation followed in 1992.

When a device or drug fails, an FDA regulator can count on hostile headlines, angry congressional hearings, and the threat of new legislation. But suppose a regulator is super-cautious and doesn't approve a life-saving device. What happens? Nothing. The heart-attack victims don't know that they could have been saved by streptokinase, and so the 22,000 deaths are invisible and safe. Sam Kazman, a public-interest attorney with the Competitive Enterprise Institute in Washington, dubs the problem "deadly overcaution" and calls the system "consistent with neither good government nor good science nor respect for individual liberty and dignity."

All this is, of course, disputed by FDA partisans. Fans of the FDA use two main arguments. The first goes something like this: "Those who claim that the FDA is doing a bad job take money from drug companies. Therefore, the FDA must be doing a good job." The second argument, recently made by Sidney Wolfe of Public Citizen Health Research Group, is that "the evidence for a lag in important drugs getting marketed here later than in other countries is extremely weak."

The first argument is stupid; the second is just wrong, and everyone in the drug and device industry knows it. Thankfully, these issues are now being discussed, after years of having been swept under the rug.

The second struggle for the soul of the FDA is waged in courtrooms by food and drug lawyers. Its goal is not to change the law, but to stop the FDA from breaking it. And by making the agency's decision-making processes public, these lawsuits can expose the FDA's vindictive, sloppy, and overreaching procedures.

Since 1990, when David Kessler took over as FDA commissioner, enforcement has been one of the FDA's top priorities. In his first two months, Kessler added 100 new criminal investigators to his enforcement staff, many of them formerly with the Secret Service and the Drug Enforcement Administration. Armed raids on alternative health clinics and dietary supplement dealers followed, as well as increased warning letters, product seizures, and criminal prosecutions in the drug and device industries.

"We're getting new regulations out faster than ever before," Kessler boasted immediately after the 1992 elections. "We rely much less on voluntary agreements, and much more on court-enforceable consent decrees."

Unfortunately, the FDA isn't virtuously ensuring public safety in accordance with the law. "As with most administrative agencies," says Glenn Lammi of the Washington Legal Foundation, a D.C.-based public-interest litigation group, "the agency constantly attempts to expand its jurisdiction and power, straining against the limits the law places upon its actions."

In his 1994 book, The FDA Follies, Herbert Burkholz tells the story of what happened to Barr Laboratories during the generic drug scandal of the 1980s. Edwin Cohen, the president of Barr, testified before a congressional subcommittee in 1989 about the arbitrary and unfair treatment he had received at the hands of the FDA--"retroactive decision making, shifting standards, procedural and substantive leaks, favoritism by a reviewer, and high-handed and arrogant treatment by FDA officials." Within hours, FDA inspectors were swarming over Barr's facilities. Barr repeatedly sued the FDA for relief from harassment. The FDA said it wanted to close Barr down and assiduously tried to for the next three years. The company was deluged with minor inspection violations and delays in drug approval. Its share price fell from $37.50 to $6.00. It had to stop production on several product lines and lay off 25 percent of its employees. And in 1993, Edwin Cohen was replaced by someone whose mission was to make peace with the FDA.

The lesson of Barr Laboratories is simple. Says Burkholz: "In matters of compliance, the FDA is supreme. If the agency says that the floor of your plant is dirty, then you'd better grab a mop and a broom, even if you know that it's pristine clean, because no court in the country will take your side." Or, as Joel Nobel says, "You are not paranoid. They are really out to get you."

The generic drug scandal is over, but the FDA is still around. And, according to Glenn Lammi, so are reasons to sue.

* Under the Food, Drug, and Cosmetic Act, new drugs have to be approved or rejected within 180 days. So do "Class III" medical devices--the most heavily regulated devices, including pacemakers. But we should be so lucky. Pre-market approval requests for Class III devices take an average of 840 days (up from 337 in 1988), and new drug applications are running at two and a half years. One hundred eighty days used to be a mandatory deadline. Now, it's a discretionary "goal"--no thanks to Congress, which has never even commented on the change, much less authorized it.

* Since 1991, medical-device distributors have been required to register with the FDA. Before then, only those who "manufactured, prepared, propagated, compounded, or processed" drugs and devices had to register and were subject to "Good Manufacturing Practices" requirements and mandatory inspections. But in 1991, the FDA decided that even though distributors aren't listed, they propagate devices and so they should register too. According to Lammi, to "propagate," in this context, probably means to create drugs or devices for sale. If Congress had meant to "distribute" it they would have said so; it did after all, refer to distributors elsewhere in the act.

* In 1990, the FDA decided to regulate liquid chemical germicides that are used to clean medical devices and health care products. Not only did the FDA do this without public comment, but a lot of those germicides were already being regulated by the EPA as pesticides.

Then there are those FDA procedures that aren't illegal but really ought to be. If you make medical devices, the FDA can fine you $15,000 per violation of the law, up to a total of $1 million. "Per violation" means that if you made a mistake on your label and you shipped 70 devices with that label on it, you've violated the law 70 times, which means that you have to pay the full $1 million.

Another quirk of this rule is that the judge who figures out how much you owe works for the FDA. Whoops! There goes independent, objective adjudication. The judge's ruling can only be appealed to a federal court if the judge acted "arbitrarily and capriciously," which is a tough standard to meet; it goes without saying that rules like these give the FDA a lot of clout.

The results of all this? More paperwork, more delay, more lost profits and lost jobs, more companies moving offshore to escape FDA regulation--and more patients without medical care. And unless people challenge the FDA, it will continue to infringe the legal rights of the industries it regulates and deprive consumers of good, cheap foods and drugs.

Every once in a while, people do fight back against the FDA. And every once in a longer while, some people win. The lesson from their experience is that given enough people with enough courage, money, and lawyers, the FDA can be kept in line and made to obey the law. At least for a time.

Take the case of R S Medical, makers of muscle stimulators called, appropriately, the RS-1 and the RS-2. R S Medical had been marketing the RS-1 and the RS-2 for five years, but when it made minor modifications to the products, the FDA tried to rescind its approval. R S Medical took the FDA to court; the agency agreed to let R S Medical continue marketing the products, as long as the company submitted another application.

But this time, the company played a little prank on the FDA. It submitted the applications in January 1992 and hired a consulting company to submit the same applications under different names--the BTM-100 and the BTM-200. The first application was submitted in February 1992 and the second in March 1992. In April, the FDA found that the BTM-100 was substantially equivalent to other stimulators on the market and allowed the consulting firm to sell the product. It did the same for the BTM-200 in July.

R S Medical wasn't so lucky. Its review process lasted a full year, until January 1993. The reviewers asked a lot of technical questions; the company answered them. The FDA declared that the RS-1 and RS-2 were not substantially equivalent to other muscle stimulators--for reasons unrelated to their previous questions--and denied the applications.

Ordinarily, you don't want to punch the traffic cop in the nose, but R S Medical did, and the court found "glaring evidence of arbitrary action" in the FDA's different treatment of the two companies. It was found that R S Medical's applications were rerouted; instead of going to the reviewers that normally look at muscle stimulator applications, they went to the same people at the FDA who had originally wanted to rescind R S Medical's approvals. The FDA also had conducted an unscheduled inspection of R S Medical--according to the court, hoping "to uncover some deficiency which could affect the safety and effectiveness of the RS-1 and RS-2." The district court entered a permanent injunction against FDA in December 1993. R S Medical also benefited from the Equal Access to Justice Act; this law allows small companies who sue the government to get their attorneys' fees reimbursed. R S Medical was awarded nearly $400,000 in fees.

Laerdal is another one of the shining examples of a company that beat the FDA on its own ground. Laerdal makes automatic external defibrillators, which are used to restart stopped hearts. In early 1993, the FDA charged Laerdal with many violations of "Good Manufacturing Practices" (GMPs) and a number of paperwork violations. GMPs are a set of quality-control standards (such as rules about how to handle complaints and keep quality-assurance records) that companies have to abide by if they don't want the FDA to close them down. GMPs are, in general, a good idea, but conformity with GMPs is not the same as good product performance. As ECRI's Nobel puts it, "There is no known relationship between GMP paperwork and actual product performance in the field."

The FDA's solution was to close the company down until all GMP problems were resolved. Laerdal denied everything and challenged the FDA to prove the allegations. It said it was willing to make any changes in procedures that the FDA wanted. In an effort to accommodate the FDA, the company kept improving its systems and adding enhancements from the time the suit was filed until the time the trial started. But it staunchly refused to shut down.

The resulting trial lasted three weeks and revealed that while the FDA might be effective at regulation, it's lousy at litigation. It makes the kind of tactical blunders one might expect from an agency that isn't used to being under scrutiny.

The FDA routinely asks for exhaustive documentation on minute details of company procedures. But the FDA itself isn't prepared for similar probes. At the time of the trial, there were only three companies making automatic external defibrillators (AEDs). Each defibrillator is estimated to save one life per year. It seems reasonable that the FDA would at least try to estimate the effect on the AED market of shutting Laerdal down. Well, it did try. Its idea of an economic impact statement was a memo--one which obviously was never supposed to see the light of day--saying that someone at the FDA called up a broker friend to get a sense of the market, and that the broker said it wouldn't be much of a problem.

The FDA is also used to having internal, confidential discussions with its own in-house experts. Normally, it doesn't have to reveal anything that goes on in such discussions. The FDA's stock response to outside requests is, "File a Freedom of Information Act request"--and a lot of information isn't available through FOIA. But during lawsuits, whatever goes on in conversations with expert witnesses has to be made known to the other side. The FDA didn't count on that. In fact, in the Laerdal case, the FDA even withdrew one of its expert witnesses rather than submit the agency to such scrutiny.

The judge found that the FDA had failed to make its case. The FDA couldn't prove any of the GMP violations. Not one of them. Not even for the procedures that Laerdal changed at the FDA's suggestion. Of all the paperwork violations, the judge found for the agency in only one case. That case is now under appeal by Laerdal. The FDA didn't even try to prove the charges. It expected the court to take its claims at face value.

The Laerdal case, one attorney told The Food and Drug Letter, an industry newsletter, makes clear that "the burden of proof is on the agency to demonstrate the existence of a violation for which the proposed remedy is appropriate....The agency took the approach of saying, 'We want you to show that you are in compliance,' instead of accepting the responsibility of demonstrating someone is out of compliance. They were saying, 'Would you kindly take a step into the quicksand we have ready for you here?' That is not acceptable."

Usually, the FDA gets away with shifting the burden of proof, because companies are afraid to fight the agency. Says Larry Pilot, an attorney at the law firm McKenna & Cuneo, which represented Laerdal: "Lord, [some companies will] sign a consent decree before they get a single bit of information from the FDA. They don't know what the FDA has on them."

Perhaps the strangest thing about the Laerdal case is the FDA's reaction. The FDA Center for Devices and Radiological Health came out with a report on its "accomplishments" for 1994. Under "Enforcement": "In a contested court action against Laerdal Manufacturing, the District Court judge ruled in favor of FDA in finding the firm failed to properly meet its [paperwork] requirements." That's the one charge which wasn't thrown out, in a case where the FDA started out by claiming that the defibrillators were unsafe and killed people. The FDA didn't contest the decision. It filed an appeal, but later withdrew it.

Peter Barton Hutt, once the FDA's chief counsel, has become a vocal critic of the agency. But he is pessimistic about the odds of beating the FDA in court. Successful cases, says Hutt, are flukes. "The judicial system, no matter what people say, is a lottery. You get a good judge or a bad judge, a good jury or a bad jury--it's totally unpredictable, like Russian roulette. The variability of the judges is infinitely more important than the 'validity' of the case. All of these decisions are so ad hoc that for anyone to draw lessons from them is a terrible mistake."

Except, Hutt corrects himself, for the one large lesson: "The odds of prevailing against FDA are small. If you believe in engaging in the lottery, you might want to litigate against the FDA too."

And, says Hutt, the agency holds grudges. No matter what happens--whether it wins or loses--it never forgets who its enemies are. "If you lose, you have an angry FDA which is willing to slit your throat. When the FDA loses a case, it has a mind like an elephant. It's just something you've got to understand about the FDA. Once the agency makes a collective decision, trying to make it let go is almost impossible. These are 'FDA crusades.' In a real sense, they're vendettas. They started a war in 1920 with the dietary supplement industry, and it's not over yet. The FDA decided that cyclamate was dangerous in 1969. Everyone knows it's not dangerous, but they still don't have the political courage to say, 'We made an honest mistake in 1969.' The FDA is institutionally incapable of doing that."

Still, suits can be good for consumers and manufacturers, if not for the original plaintiffs. Prominent food and drug attorney Jerry Heckman, of Keller & Heckman, tells the story of a landmark food-packaging case that was handed down in 1979. Food packaging usually doesn't get as much press as drugs and devices, partly because the FDA is a lot less of a problem with food packaging. But why is that? Part of the answer may lie in the tale of Monsanto v. Kennedy.

Monsanto had an unbreakable bottle made out of a material with a long name straight out of science--an acrylonitrile styrene copolymer. This was considered an extremely good bottle, and it might well have captured the soft drink market. Unfortunately, some bad data came out on the toxicity of acrylonitrile. Not the plastic, mind you, but the material that was used to make the plastic. The FDA issued a press release, saying in effect that it had made a mistake in approving the bottle. Coca-Cola, which was going to market products in the bottle, withdrew from the deal they'd made.

Monsanto sued the FDA, and the FDA took the second. The second law of thermodynamics, that is, which says, among other things, that substances diffuse over time, and so acrylonitrile will eventually get into your Coke. This means, said the agency, that acrylonitrile is a "food additive" and should be regulated under the 1958 Food Additives Amendment to the Food, Drug, and Cosmetics Act. Well, yeah, said Monsanto, but there was so little acrylonitrile that it could never be a problem.

Judge Harold Leventhal, who heard the case, called the second law of thermodynamics "a paradigm of technical information well understood by all scientists and practically no persons of the culture of humanism and letters." The first law is that whenever you say "acrylonitrile styrene copolymer," a judge's eyes glaze over. But in this case, Monsanto won. The court told the FDA that second law or no second law, food and drug law didn't prohibit teensy-weensy amounts of chemicals. FDA had to go back and reconsider their position.

As we know, when the FDA loses, the company doesn't always win; it took the FDA five years to reconsider. By then, the market for that plastic was gone in the U.S. because PET (that's "polyethylene terephthalate" for people of science) was now all the rage, though acrylonitrile is still being used for reusable bottles in Japan and Germany.

But Monsanto is a landmark case because it established that there's such a thing as a "reasonable expectation of no migration." In the decade following Monsanto, as analytical methods became more sensitive to minute quantities of chemicals, the FDA became more and more willing to say "this is so small that we don't care." In the end, both consumers and plastics companies came out ahead.

In 1993, the FDA came out with an official "threshold of regulation" policy for food packaging, which said the following: Suppose that your package contains a substance, but there's so little of it that it would only be one two-billionth of your diet. Or suppose that the substance is already regulated as a direct food additive, and your package would only add 1 percent of the recommended daily intake. Then, that substance is exempt from regulation as an indirect food additive. The 1993 thresholds of regulation were a large step for food packaging; Heckman, who represented Monsanto, calls them "unusually satisfying." And they wouldn't have been possible if Monsanto hadn't decided to sue the FDA.

In the final analysis, though, legal action is at best only a second-best solution. Even if all legal action were successful, all that lawsuits can do is make sure that the FDA follows the law. When the FDA does stupid things in violation of the law, litigation can keep it in line. But even if perfectly implemented, the law would give the FDA far too much power to restrict consumer choice and access to life-saving treatments.

The Laerdal case showed that if the FDA tries to shut a company down in an outrageous way, the FDA can be stopped. Shutting a company down in a run-of-the-mill way is still OK, though. Joel Nobel tells manufacturers: "If [the FDA Device Center] destroys a company and the livelihood of its employees, that is irrelevant to both the agency and Congress. The law does not require them to be concerned, and that argument, frequently made by industry, falls on deaf ears. Do not bother making it....The only way to get a response, either from Congress or the FDA, is to invoke public scorn, invective, ridicule, and sarcasm....I do not like this approach. It is rude and tasteless. But nothing else we have tried has ever worked. Lest you think this is a very private view, several [Device Center] insiders have confided to us that they think it is the only workable approach." One of the advantages of court cases is that, if properly publicized, they can evoke the appropriate scorn. But scorn is of limited value unless it leads to actual reform.

Reforming the FDA shouldn't be all that difficult. It's not as if we need to reinvent the wheel. Other countries have fine wheels already, and they roll more smoothly than ours. Here are a few examples from medical-device regulation.

In the United States, a device manufacturer has to send a pre-market notification to the FDA when it wants to market a new device. The pre-market notification, which the FDA quaintly calls a "510(k)," basically tells the FDA, "This device is substantially equivalent to a device that's already on the market, and I'm planning to market it in 90 days." (This system doesn't apply to the really risky devices, such as implantables.) Ninety days is the limit set by law, but the FDA stopped meeting that deadline in 1992. The average review time for a 510(k) is projected to exceed 300 days next year. Once upon a time, this would have been no problem, because when the 510(k) system was set up, you were free to market as long as the FDA didn't say no. But in 1990, the rules were changed; now, you can't market unless the FDA says yes. So despite the 90-day rule, review times have skyrocketed, companies have to wait unreasonably long times before they can market their products--and we don't even get a significant safety benefit out of it, since these aren't even risky devices.

In Canada, on the other hand, there is no "pre-market notification" system. They've got "post-market notification." You have until 10 days after you begin marketing to submit your application to the Canadian equivalent of the FDA. And they can't stop you unless they find something wrong with your product. The threat of having one's product pulled from the shelves is enough to keep device manufacturers in line--but the innocent, small device manufacturers can still get their products out.

There's another interesting thing about Canada--you can export from there. In the United States, the FDA has to grant an export license for you to be able to sell to another country--even if the other country has already approved your device. It gets even worse: In one recent case of regulatory imperialism, the FDA tried to seize "adulterated" mushrooms that hadn't cleared customs yet. Normally, when goods haven't cleared customs, the importer has the right to reexport them, whether or not they're misbranded. But an FDA district director said, "Where we believe there is a potential hazard to health, we don't want this stuff going anywhere." A federal judge in New Orleans nipped that one in the bud, though the FDA wants the case reconsidered.

Paul Geyer, a Canadian medical-device manufacturer, tells people to set up shop in Canada because "if the FDA walks into your place and says, 'We're shutting you down for X, Y, and Z reason,' you can't do anything; you can't ship to Europe; you're dead." If you're in Can-ada, the FDA can stop you from selling in the United States, but at least it can't stop you from selling elsewhere.

One of the main barriers to medical-device innovation in the United States is slow and
unpredictable regulatory treatment. In Europe, things are faster, clearer, and more efficient. Medical devices have to abide by certain known, definite standards, which are based on the standards and practices of the industry. This is in contrast to the U.S. system, where companies have to abide by "Good Manufacturing Practices," which are made up by the FDA and subject to interpretation by the inspector. In Europe, if you conform to all of the standards, you can get a "CE" (Certified Europe) mark from any of a number of private or quasi-private certifying organizations called "notified bodies." Each country can designate its own notified bodies, such as the British Standards Institute. The European system has two distinct advantages. First, device manufacturers aren't subject to the whims of overzealous inspectors. And second, things go faster and more smoothly because "approvals" are handled by what are essentially competing FDAs.

The most important thing to do is to end the FDA's monopoly in drug and device approval. The FDA should keep reviewing drugs and devices (preferably farming the job out to these private certifying bodies), but only in an advisory capacity. Unapproved drugs and devices could carry warnings--a metaphorical skull-and-crossbones--but the final choice should be left to hospitals, doctors, and patients. Doctors, whose reputations and incomes are on the line, would still have an incentive to act responsibly, and so unapproved drugs and devices wouldn't be widely used--but they would be available for those in need.

Humorist Dave Barry tells the true story of the time federal law enforcement authorities cracked down on a shipment of frozen scallops. In October 1994, the marshal's office in Norfolk, Virginia, was ordered to arrest more than 6,400 pounds of sea scallops. Their offense? Containing between 85 percent and 87 percent water. Interim water content guidelines set by the FDA and the scallop industry set the maximum water content at 84 percent. On September 6, the U.S. attorney's office filed a civil lawsuit against the scallops in the U.S. District Court in Newport News, Virginia. The lawsuit's name: U.S.A. v. 268 Cases, More or Less, of an Article of Food. As Barry might say, I swear I am not making this up.

Due to their spineless nature ("as members of the deceased mollusk family," as Barry put it), the scallops chose not to challenge the FDA. But are we men or scallops?

Not that the FDA should be challenged lightly. As The Food & Drug Letter notes, "Dealing with FDA is a study in boundary recognition: knowing when to advance, when to retreat, when
to confront, when to tug the forelock." Tommy Thompson, chairman of the Medical De-vice Manufacturers' Association, warns, "Don't get the idea that we want to be belligerent. We say 'Yessir' just like anybody else." But as David Link, who was the first head of the FDA's Bureau of Medical Devices, reminds us: "You do not want to throw things back in FDA's face, but you do not want to get screwed, either."

There has probably never been as much hope of reforming the FDA as there is during this Congress. But the hopes of reformers have been dashed before. At a recent medical-device convention in Anaheim, California, "How to live with the FDA" and "How to leave the FDA" were the dominant themes. FDA representatives and other experts went into excruciating detail about how to prepare a 510(k), what exactly GMPs are, how to prepare for an inspection, why you should do exactly what the inspector says, and so on. Meanwhile, one session was entirely devoted to why manufacturers should emigrate to escape the clutches of the FDA and where they should go.

As for prospects of reform, FDA experts don't seem to be holding their breath. Commissioner Kessler may be the most popular government employee in Washington today, says writer James Dickinson of Medical Device & Diagnostic Industry. The naked truth may be that the American people want the FDA because they're scared of things they can see. Thalidomide babies are visible and make headlines, and people want to avoid that. Heart-disease patients who die because a drug wasn't available yet--these people, though more numerous, are invisible, and so people aren't too concerned with that. And people are still more comfortable with thinking of food and drug corporations as the enemy. The folks at the FDA are from the government; they're here to help us.

So the American people may be of limited help. And firms that appease the FDA, says one food and drug attorney, are only "nourishing the monster....Most companies do not want to fight the agency, even if they have a defensible position. By their reluctance to challenge, they are encouraging FDA to trample their rights. This will continue until some David decides that, if Goliath is going to kick his ass, he is going to have to do it."

Which means that for now, our best hope may be that in this litigious society, someone, somewhere, will decide to sue.