Wednesday, June 24, 2009

Congress Could Benefit From Some Risk Management Classes

I was watching the news (I don't know why I do that) and the Universal Health Care issue was raised. People from both sides presented and it was stressed that employees happy with their current coverage could keep it. The reporter asked what would keep a company from deciding not to offer benefits to their employees anymore, as there would be another option for them, and thereby eliminating the coverage that the person liked. A reasonable question as far as I was concerned and one that would need to be addressed. What was the response? That's a Republican talking point and not our intent.

Not our intent. How many times do we hear that from Congress. That is just a talking point from the other side and not the intent of our legislation. They even sometimes get hostile over the suggestion that their legislation could have unintended consequences. But risk management is a necessity for the design of any product. And that's what Congress is doing. Designing a product. And yet they do no risk management at all. They make no effort to determine how their legislation could go wrong, how often it would happen, and the impact if it did happen. These are necessary pieces of information to have so that you know what loopholes need to be closed and can figure out how to close them. This is a basic FMEA (Failure Modes and Effects Analysis) a great tool for risk identification and mitigation. So why won't Congress use it?

Instead of using a simple tool to identify risks, they write legislation that is so long and convoluted that they can't even take the time to read it before voting on it. The stimulus bill for example. An important piece of legislation according to them. Had to be passed quickly. But they paid more attention to doing it fast than doing it right. So what has happened? The money is being misused because they didn't try to figure out how that might happen and how to stop it. And a lot of the money isn't being spent. It had to be passed so quickly so the money could get into the economy but that hasn't happened. That bill was 1,200 pages long. One giant opportunity for unmitigated risk.

To give you some perspective on the absurdity of the length of that bill, and it's just an example of many like it, I have a copy of the Constitution that is pamphlet sized. Pretty small cover and pretty small pages. And yet, that little book is still only 48 pages long. That is our Constitution and all of it's amendments. That's 48 pages to set the rules of our government, but it took 1,200 pages to spend money. And spend it badly.

Is it really so much to ask that our legislatures make an attempt to identify gaps in their legislation before they pass it? Oh, but I guess they'd have to actually read it in order to be able to do that.

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