[extropy-chat] Professor Being Sued Over Anti-Aging Comments

[Matthew Gingell]

On Jun 21, 2005, at 4:59 AM, BillK wrote:

> The $20 million fine was because of fraud, deception and unfair
> business practices.
> You can't sue for damages if you are dead.

But you can! One possibility is that, if we were to make the right to  
sue for damages a marketable good, you could sell the right to  
collect in the event of your wrongful death to a third party and  
enjoy the judgement while you are still alive. Say I have a one in  
ten thousand chance of being killed wrongfully and my estate being  
awarded a ten million dollar judgement: I ought to be able to sell  
that right to a "reverse insurance company" for a thousand dollars  
and go out and spend it on something fun today.

More important than cash in hand though, there is now an agent very  
much interested in going after whatever wrong-doer has prematurely  
ended my life, and you would expect this to provide a powerful  
disincentive to product manufacturers looking to cut corners at the  
cost of increased risk to me.

Now, whether I really wants a huge reverse-insurance corporation to  
have a ten million dollar interest is seeing something horrible  
happen to me is another question entirely...

> Similarly you can't sue for
> damages if the fraudsters have closed the company and opened up
> elsewhere with a different name and a different scam.

That's right - and I think this is part of the rationale for making  
fraud a criminal rather than a civil matter. If you and I have an  
honest dispute over the performance of a contract that's an  
appropriate thing to bring before a court together and negotiate, but  
if you cash my check and disappear in the middle of the night then  
that's a simple theft and we are no longer in the voluntary exchange  
business.

> By going the private route of insurance policies and consumer
> education you are transferring a vast workload on to every member of
> the population. I would much prefer to let a government agency worry
> about chasing the bad guys. I have plenty to worry about already,
> without having to investigate the truth of every advert or analyse
> carefully every future purchase.

And it's a workload people in general are extremely poorly suited to.  
If there's one thing that people do consistently badly it's risk  
management... It's not too hard to find people who won't, for  
instance, vacation in Florida because they're afraid of sharks yet  
thing they're doing something positive for their health by spending  
every Saturday riding around their bicycle without a helmet on. I  
think this is one of the strongest arguments for taking this  
responsibility out of the hands of individuals and leaving it to cold- 
blooded government technocrats.

Government agencies like the FDA are not without their own problems  
though. One persistent criticism of the FDA is that they are  
excessively risk averse and refuse to approve drugs which might well  
help some very sick people. This makes sense from an incentives  
perspective: In the last few years we have had some very big public  
scandals over drugs the FDA has approved which turned out to be  
harmful, but in my lifetime I can not recall a single major fuss over  
a drug which was effective but which the FDA did not approve. Holding  
an effective drug off the market kills people just as surely as  
allowing the sale of a dangerous one, but if the FDA is only going to  
be "punished" for mistakes in one direction we would expect them to  
strike a lopsided balance between those two alternatives.

> The majority of the population are not interested in insurance
> policies, consumer reports, science investigations, etc. They watch
> the ball game and buy what the adverts tell them to. They are entitled
> to do that in reasonable safety. We shouldn't have to live in a world
> where every advert is a possible attack by a fraudster and every
> product on sale might be a scam.

Absolutely, and that's the outcome that everybody can agree is  
desirable. The only debate I see is how to achieve that outcome at  
the minimal cost both in terms of economics and liberty.

Matt