“Say it isn’t so, Mr. Sears! Are you really recalling my saw?” That was my gut reaction to a small news item in my local newspaper this past week announcing that Emerson Tool of St. Louis was recalling 3.7 million radial arm saws (including mine) manufactured for Sears over the last 40 years and sold under the Craftsman brand.
Product recalls are now a daily occurrence in U.S. life. Automobiles and baby products apparently are the most frequently affected items, but gas- and electric-powered consumer devices run close behind. I suppose it was only a matter of time before a similar fate befell the Sears Craftsman radial arm saw, a quintessential symbol of the American do-it-yourselfer if there ever was one.
But the recall also raises questions about the policies the U.S. uses to ensure product safety. We have federal laws and agencies, such as the Occupational Safety and Health Administration and the Consumer Product Safety Commission, that write regulations to ensure that consumer products and tools are “safe.”
We also have legal doctrines of nearly unlimited liability, not only for actual damages but for punitive damages as well. Manufacturers who do not recall products with sufficient alacrity risk having that lack of action portrayed in the courtroom as willful and malicious conduct.
It was not always thus. There were no federal safety standards to speak of until the 1970s. The “reasonable man” doctrine dominated safety litigation through the mid-20th century: A manufacturer was immune from damages if the product was not deemed dangerous when used by “any reasonable man.” Implicitly, reasonable people knew that lawnmowers and power saws were inherently dangerous and that if someone’s thumb or foot got in the way of a sharp moving blade, that person was responsible for his own misfortune.
Now the pendulum has swung the other way, and a manufacturer can be sued even if the device in question is festooned with warning labels and bedecked with guards and safety shutoffs. A company that manufactured saws 40 years ago is forced to recall them at a unit cost that must exceed the current value of many of these tools.
Perhaps it is time for us to step back and take a broad look at what we want to accomplish in terms of product safety and how well our current policies work. We need to ask ourselves if there are more effective ways to ensure public safety at lower cost to consumers.
The last point is important. It is consumers who ultimately bear the cost of liability settlements and who pay for the blade guards, automatic shutoffs, kill switches and other devices necessary either to meet government standards or to convince juries that the manufacturer did, in fact, make every effort so that the product would not harm any user.
A few benighted individuals may believe that amoral profiteers produced Craftsman saws with reckless, intentional disregard for the public. They may believe that completely “safe” products can be produced at no greater cost to buyers if we simply reduce the outrageous profits of patently corrupt corporations such as Sears or Emerson Tool. Some people also believe in the tooth fairy.
But decades of everyday experience and economic research demonstrate that consumers, not plutocratic plunderers, generally pay the freight of both regulation and litigation.
In a just society, most people want to buy products that are reasonably safe. They also want to buy products that are as low-priced as possible. Most realize that there are trade-offs between safety and price. This trade-off between “reasonably safe” and “reasonably priced” is inherently a subjective one.
But denying that the trade-off even exists inevitably makes society as a whole worse off than if questions of cost and benefit are addressed squarely. Similarly, in a just society, most people do not want to see people who are injured while using specific manufactured products, such as tires or saws, to have their lives ruined when injury occurs through either careless or prudent use.
While not everyone can be “made whole” in a literal sense, most thoughtful people want some mechanism for compensation when injuries occur as a result of flaws in design or manufacture. Many also believe that some of the cost of even careless use should be socialized rather than borne entirely by the individual. Few would welcome substantially higher prices for manufactured goods solely to make them safer in use.
Society benefits from policies and a legal environment that provide incentives for both careful design and manufacture and careful use of useful devices. Regulation and tort litigation can both play a role in creating such incentives.
But the human and social opportunity costs of over-regulation and excessive litigation are as real and potentially as great as the physical and human damage caused by lack of regulation or by insufficient litigation.
As an individual, I cannot tell you the optimum levels of regulation and litigation. But as an intelligent (but not always careful) tool user, I think that a recall of well-made 40 year-old saws indicates that something is out of whack with our current policy mix.
© 2000 Edward Lotterman
Chanarambie Consulting, Inc.