President Barack Obama talks with Cass Sunstein, Office of Information and Regulatory Affairs Administrator, and Senior Advisor Valerie Jarrett on West Executive Avenue between the West Wing of the White House and the Eisenhower Executive Office Building, April 7, 2011.

President Barack Obama talks with Cass Sunstein, Office of Information and Regulatory Affairs Administrator, and Senior Advisor Valerie Jarrett on West Executive Avenue between the West Wing of the White House and the Eisenhower Executive Office Building, April 7, 2011.

From 2009 to 2012, Cass Sunstein was administrator of the Office of Information and Regulatory Affairs, known as OIRA. As President Obama’s “regulatory czar,” he oversaw nearly 2,000 new rules, from fuel efficiency standards and the redesign of the food pyramid to health care and Wall Street reform. In a new book, he says efforts to simplify and scale back regulation in the president’s first term resulted in net benefits of $91.3 billion dollars in net benefits for the American public. He joins Diane to explain why simplification is the key to the future of government.

Guests

  • Cass Sunstein professor at Harvard Law School; director of the Program on Behavioral Economics and Public Policy; columnist for Bloomberg View; co-author of "Nudge" and former administrator of the White House Office of Information and Regulatory Affairs from 2009 to 2012.

Read An Excerpt

From “Simpler” by Cass R. Sunstein. Copyright © 2013 by Cass Sunstein. Excerpted with permission of Simon & Schuster, a Division of Simon & Schuster, Inc.

Transcript

  • 11:06:56

    MS. DIANE REHMThanks for joining us. I'm Diane Rehm. When President Obama nominated Cass Sunstein to head the White House Office of Information and Regulatory Affairs, objections came from both the left and the right.

  • 11:07:13

    MS. DIANE REHMGlenn Beck called him "the most dangerous man in America." Sunstein has written a book about his three years as the president's regulatory czar. Now a professor at Harvard Law School and director of its Program on Behavioral Economics and Public Policy, his book is titled "Simpler: The Future of Government."

  • 11:07:37

    MS. DIANE REHMCass Sunstein joins me in the studio. I invite you to be part of the program. Call us on 800-433-8850. Send us an email to drshow@wamu.org. Follow us on Facebook or send us a tweet. Good morning to you, sir, it's good to have you here.

  • 11:08:01

    MR. CASS SUNSTEINGood morning to you, good to be here.

  • 11:08:02

    REHMYou know, before we look forward into how the future of the government might look, I want to go back to the fact that you came to government from academia. I wonder to what extent you had been prepared for the contentious confirmation hearing that you got.

  • 11:08:29

    SUNSTEINNot very well. The academic world is said to be a place where people are fighting and, you know, upset with each other and is sometimes unfair, but it's a very peaceable world compared to the world of confirmations, so. Confirmation was an adventure and it was something for which I had had no experience or background.

  • 11:08:51

    REHMOn the left, you were criticized because you favored cost benefit analysis, low-cost approaches to regulation. On the right, they called you a radical animal rights activist who would seek to ban hunting, forbid meat-eating, ban conspiracy theories, outlaw marriage and steal human organs. Where did all that come from?

  • 11:09:26

    SUNSTEINWell, some of it I understand a little bit. I was also called a Rothschild Zionist and I'm still not exactly sure what that is. I mean, what I felt during the process really was that if you have a chance to serve the American people, that is like the honor of a lifetime. And the fact that the president had chosen me for that was -- I was, and remain incredibly grateful.

  • 11:09:52

    SUNSTEINAnd the Senate is entitled to look pretty carefully at people who are going to be given a degree of public trust so though I wasn't prepared for those sorts of words, I understood that this is a process that's part of our democratic system.

  • 11:10:13

    SUNSTEINI think what happened in my case and in many cases is that I particularly had written a lot. Academics, if they want to keep their jobs, probably should be writing a lot and if you take stuff out of context, it can be turned into something.

  • 11:10:30

    SUNSTEINNow cost benefit analysis I am devoted to. I think it's very important. The president insists on it for regulations. I think that's a good thing. Some of the other inflammatory language I'm not sure what the basis of it is, but probably at some point I wrote something. Maybe if you took out a not or put in a semicolon you could get in that direction.

  • 11:10:56

    REHMBut, you know, it went so far as you were receiving hate mail at home, death threats. How did all that happen?

  • 11:11:09

    SUNSTEINI think what happened was there were some people who, you know, it's part of our democracy, but there are some people who got an idea of me that was scary. So if you have someone on national television, Glenn Beck is an example I know of, probably there are others, saying that this guy is dangerous and evil and your rights are at stake and terrible things will happen, then people will get worried.

  • 11:11:44

    SUNSTEINAnd a death threat is pretty extreme stuff so I don't think there's much of a place for that.

  • 11:11:53

    REHMHow did they get your home address?

  • 11:11:54

    SUNSTEINI still have no idea. I don't know how they got that. And that was not the -- you get a lot of letters that are amusing and some of them are unfriendly, but instructive. Maybe they make a good point. That particular letter wasn't a lot of fun to get.

  • 11:12:11

    REHMI should say. Having read C.P. Snow's novels for many years, I know about what can happen in the sort of pushback you can get within academia, but this seems way too extreme and the irony is that this was, in your mind, your dream job.

  • 11:12:40

    SUNSTEINYeah, and I felt during it and before it and today that this was, you know, an extraordinary blessing to be in a position where you can maybe help save some lives by participating and making a rule that's going to make highways safer or make the air cleaner or you can help to create a process that will make things easier for businesses in a very tough environment.

  • 11:13:05

    SUNSTEINSo the focus really, I think, for anyone who gets to serve the public is what they're getting to do and not on some of the stuff that sometimes accompanies that.

  • 11:13:18

    REHMBut did the critics looking at your writing have reason to be worried about just how far you might take regulation?

  • 11:13:31

    SUNSTEINI don't think so. I didn't really. I think one thing. There are a couple of things that were missed. One is that if you're working for the government, you're serving the American people...

  • 11:13:39

    REHMAbsolutely.

  • 11:13:39

    SUNSTEIN...and that means a couple of things. First, you're part of a team and second that your own speculative thinking is not going to be your agenda. So anyone who is appointed as part of the president's team works for the president and isn't going to be going off on a lark of his or her own, even if he or she wants to. And the chance that that person is going to want to do that is really low.

  • 11:14:06

    SUNSTEINSo my focus as soon as I got there was, you know, how can we protect public health and safety, the environment while also ensuring that our economy is getting out of a very tough situation? And that was really the only focus of my time there.

  • 11:14:23

    REHMCass Sunstein, he's a professor at Harvard University School of Law, director of the Program on Behavioral Economics and Public Policy. He is a columnist for Bloomberg View and co-author of The New York Times best seller "Nudge." Now I want to come to the title of this book, which is "Simpler," with the R reddened over. Why?

  • 11:15:01

    SUNSTEINWell, I think the idea was to make a play on simpler and simple with the cover. So the title of the book isn't "Simple," it's "Simpler." To make government in the future simple is, it's probably a challenge, what's called in government a heavy lift. But to make it simpler is very doable. So the cover is meant to draw -- get a little red in it, so maybe draw the eye, but also to suggest simpler. That we can do.

  • 11:15:31

    REHMTell me about behavioral economics, help me to understand it.

  • 11:15:38

    SUNSTEINOkay. The basic idea for behavioral economics is that the old economics axiom that people are fully rational isn't quite right, that if you look at human beings and their behavior -- and I kind of did at the University of Chicago in the early '80s when rational choice theory was all the rage.

  • 11:15:59

    SUNSTEINAnd some of those people insisting on the rationality of human beings, you know ,were complaining about their own stupid investments and hitting crazy topspin forehands on the tennis court. And maybe they were in the midst of divorces and it wasn't clear that these enthusiasts for rationality were themselves anything other than human. And maybe the rest of us are human, too.

  • 11:16:22

    SUNSTEINSo the idea for behavioral economists is the basic idea which is that people deviate from rationality and predictable ways so that sometimes we procrastinate, sometimes the future is to us a foreign country and that can get us in trouble with respect to health or savings planning for the future.

  • 11:16:44

    SUNSTEINPeople are optimistic. They are unrealistically optimistic, about 80 percent of the population. So 90 percent of drivers think they're safer than the average driver and less likely to be involved in a serious accident. People often think that bad things will happen to other people, but not to themselves.

  • 11:17:03

    SUNSTEINAnd that tendency to procrastinate and excessive optimism can create real harm for people. And behavioral economists really just try to track how people depart from behavior that might be in their interest. And they don't have a political program so much. They're just trying to figure out what behavior is, but we can probably learn some lessons about how to make people's lives go a bit better.

  • 11:17:30

    REHMBut does the same hold true for governments?

  • 11:17:34

    SUNSTEINAbsolutely. So the risk of procrastination and excessive optimism that ordinary people are subject to, governments themselves are subject to -- and no doubt people can think of their own preferred examples. There's a very interesting, a pretty recent finding, in behavioral economics which is that when people are answering questions in a foreign language, a language that isn't their own, some of the mistakes people make when they're answering questions in their own language disappear.

  • 11:18:06

    SUNSTEINThat is, they do better in a foreign language. That's extremely interesting and the reason is that when you're answering in your own language, you're using your own intuition, your own kind of automatic thinking. You're not stepping back and deliberating and using, you know, more reflective parts of your head. You're using the more automatic intuitive part.

  • 11:18:27

    SUNSTEINAnd I think there's a lesson here for governments of how they can get out of the trap of behavioral mistakes and it is back to our old friend, cost benefit analysis.

  • 11:18:35

    REHMCass Sunstein, he's a professor at Harvard University School of Law. His new book is titled "Simpler: The Future of Government." Short break and we'll be right back.

  • 11:20:08

    REHMAnd welcome back. Cass Sunstein is with me. He served as the administration's -- he was the administrator of the White House Office of Information and Regulatory Affairs from 2009 to 2012. He was the regulator czar, as people like to refer to it. Now he has a new book out. It's titled "Simpler: The Future of Government." Generally speaking, how do you think the government can be made simpler?

  • 11:20:53

    SUNSTEINWell, the -- I think a good model's provided by like an iPad and a computer where the ingredients are really complicated but the interaction with it is really simple, so much so that a child can do it. I have a three-and-a-half-year-old boy and he can work on an iPad. And government should be more like that. So I'll give you some examples of things that actually happened.

  • 11:21:18

    SUNSTEINThere's an application for federal student aid for people to go to college and it's been overwhelming for parents and students in the sense that it's so complicated and long -- and I'm going to get to taxes in a moment -- that it's deterred people from applying. In fact, good economic aid for people can be less helpful in getting them to college than scaling back this nightmare form. And we did that. We took away 5.4 million annual hours in paperwork burdens. That's allowing a lot of people to go to college who wouldn't otherwise.

  • 11:21:57

    SUNSTEINTaxes may be on people's minds. We're the day after tax day. And one thing the IRS has done -- it's made some progress -- is to have these forms easy. There's a simple one that's just one page that a lot of people are using. Some people qualify for that. And it's also had a big push toward electronic filing, which is making things easier for people. The American people are subject to 9 billion annual hours of paperwork burdens. That's too much. Almost 75 percent comes from the Department of Treasury, which means mostly the Internal Revenue Service. All this can be scaled back and free people up in terms of their time.

  • 11:22:36

    REHMWhat about health care?

  • 11:22:39

    SUNSTEINThe thing for health care that we need to do, one thing is coming, is to make it easy for people to be in health insurance. So part of the statute is automatic enrollment. Now a lot of employers do this already, so as soon as you start your job you're automatically enrolled. You don't have to have a headache of figuring out when you're trying to get used to your job or be with your family, what health care plan am I in. They choose one for you and then you can fix it if you don't like it, if it doesn't suit your situation. But automatic enrollment is a general practice in coming.

  • 11:23:11

    SUNSTEINSomething that's going to be a real challenge for the next years is the system of the exchanges which is coming. And we want that to be more like the direction that the financial aid for education is going in of ease and simplicity than like the direction that the tax system is coming from, which is one of complexity and overload. So for health care the big challenge for the future is to make it so that people have simple, clear choices. And if they want to dig deep into the details, they can certainly do that. But basically make it easy for people to get in the system.

  • 11:23:52

    SUNSTEINWe've made great progress on saving for retirement with automatic enrollment, which employers all over the country are taking advantage of and the Obama Administration has supported. And that means people are automatically in a system. They can change if they don't like it. They can get out if they don't want it. But they are -- if nothing happens, if they don't change it they're going to be okay when they retire.

  • 11:24:13

    REHMBut the question becomes why you left the Obama Administration after just three years. Did you feel you had done everything you could?

  • 11:24:29

    SUNSTEINWell, I think it would be an extraordinarily lucky person who felt after any period, even decades in a job, they had done everything they could. But most people -- the job I had most people are in for two years or less. I was one of the longest-serving people. And I think many people who work in a White House job feel two years, three years, four years about right. And I was there for nearly four years.

  • 11:24:58

    REHMHow tough was it on you, your family?

  • 11:25:02

    SUNSTEINWell, I felt every day was unbelievably lucky. So the idea that you get to walk in those gates and, you know, spend some time in those buildings, that's not something many people have the good fortunate to get to do. So my basic feeling was good fortune. Now it is true that you're looking at your Blackberry a lot and the hours -- you don't have any slow days. And that's part of the price of the privilege.

  • 11:25:39

    REHMThe question is, though, did you see the opportunity to work in government on these issues as an opportunity to test the theories you had been working on at the University of Chicago?

  • 11:25:58

    SUNSTEINAbsolutely not. So if I had come into the government and said, now I'm going to cast my theories, I think it would have been appropriate for people to say, now it's time for you to test the private sector again. The government official is not a theory-testing person. A government official is serving the American public. And what the president charged me with doing was protecting health, safety and the environment public welfare in a way that's very closely attuned to the tough economic situation. So we want to, you know, make sure people are safer on the highways, that the air is safer for them to breath. But by all means, do this in a way that's consistent with the big goal of getting out of the economic crisis.

  • 11:26:43

    REHMI think there are an awful lot of people who might be surprised to learn that the total annual net benefits of major rules through those first three fiscal years of this past administration. Tell me about those numbers.

  • 11:27:08

    SUNSTEINYeah well, since Regan there's been an emphasis on what are the benefits of rules and what are the costs? And the costs could be small businesses getting hit, large businesses getting hit, ordinary people in their daily lives are getting hit. The benefits could be people are saving money because of their fuel economy. The cars are better. They're saving money because they're not faced by regulations that were on the books before. They're saving lives or getting healthier or not faced with accidents. And their money benefits that way.

  • 11:27:36

    SUNSTEINSo under the Bush Administration's first three years it had a little more than $3 billion in benefits minus cost net benefits, so $3 billion for the Bush Administration. That's an achievement. We're talking not about millions, not about hundreds of millions, but billions. The Obama Administration through its first three is over 91 billion in net benefits, which is a phenomenal record really of trying to make sure that you're not imposing excessive costs on the public. And at the same time that you're helping people, either purely economically by getting products that aren't going to cost them as much to operate, like energy-efficient refrigerators, and by getting them healthier.

  • 11:28:19

    SUNSTEINLike we had a regulation early that reduces the incidents of salmonella. And that's going to prevent up to 79,000 illnesses annually and dozens of deaths, which is to say that there are a bunch of people alive today. Now the number's probably not very far short of 100 because it's been in place for a few years, people alive today because of the regulation. And that's a life-saving rule. And there are kind of technical ways to turn that into dollar equivalence.

  • 11:28:49

    REHMBut what about the opposing view? What about those who would argue that deregulation in certain areas has really hurt the country?

  • 11:29:03

    SUNSTEINThat's probably true. We need to know the area to know whether regulation or deregulation is a good idea. So the general view is that in the airline industry deregulation has been excellent. It's driven costs down and it's been a good thing. In the financial sector, the picture's more complicated and the Dodd-Frank legislation is meant in part to stabilize the system to reduce the risk of another economic meltdown.

  • 11:29:31

    SUNSTEINSo what we did in the Obama Administration was try to avoid the sense that regulation is great or deregulation is great. None of that kind of applause or booing, but instead to look at the very particular context to see what are the human consequences of either scaling back a regulation or moving forward with one. And once you look at the human consequences of one or another action, then you really have a loadstar that prevents you from being stuck in the soundbites and the kind of continuing sloganeering from the 1960s.

  • 11:30:12

    REHMAre there any areas of deregulation you regret?

  • 11:30:18

    SUNSTEINNot that we did. So we did a number of deregulatory things and I think if I described them you'll see why we did them. One rule that we tried to get rid of successfully imposed on milk producers the same requirements that oil producers are subject to when they're transporting their product across waters. Now an oil spill is really bad and you want aggressive regulation to reduce the risk. A milk spill isn't so bad, and so you don't need the kind of aggressive costly regulation on milk people that you impose on people who are transporting oil. So we saved many millions of dollars by eliminating that regulation. The Environmental Protection Agency did it and all credit to them.

  • 11:31:04

    SUNSTEINThere was also a requirement -- this is another example for you -- of the nozzles, you know, the ones you use to put gas in your car.

  • 11:31:12

    REHMOf course.

  • 11:31:12

    SUNSTEINSome of them have air pollution technology in them that is pointless because the cars have the air pollution controls already.

  • 11:31:20

    REHM...built in.

  • 11:31:20

    SUNSTEINSo you don't need that particular high-tech nozzle. It's pure cost for no environmental benefit. We got rid of that one too.

  • 11:31:28

    REHMNow we had seen numerous oil spills, both off tankers, in water and through pipes traveling across country. What would better regulation do there?

  • 11:31:47

    SUNSTEINThe Department of Interior actually, in the aftermath of the BP spill, issued a number of rules to try to require better monitoring and better management practices. And what I think is good about them -- and you know, the Obama Administration is always willing to look back at rules to see if they truck the right balance -- but what was good about them as the first crack is that they built on the best practices of the companies that were successful and tried to spread them across. And they worked with the industries when the best practice wasn't maybe ideal, about what could be done that would reduce the risk without creating economic dislocations.

  • 11:32:33

    SUNSTEINAnd so the balance struck seemed, so far, to have stuck, it's held. And some testimony to the success is that the -- we haven't seen any oil spills of late. And we haven't seen any terrible economic harm as a result of the increased protection.

  • 11:32:50

    REHMAnd you're listening to "The Diane Rehm Show." What about Arkansas and the oil spill there, which the people are still suffering from and dealing with?

  • 11:33:05

    SUNSTEINWell, it's a fair point and, you know, oil spills are potentially very, very harmful...

  • 11:33:12

    REHM...and disruptive.

  • 11:33:14

    SUNSTEIN...and disruptive. That's why the additional safeguards that are in place have been put in place for a good idea. And it's always on the table to think that we would benefit from further protections or for more finely tuned protections.

  • 11:33:30

    REHMWhat's your own thinking about regulations that would be in place governing the Keystone pipeline?

  • 11:33:39

    SUNSTEINYou know, that's not one that I -- came across my desk. It wasn't a regulatory action in the technical sense that my office dealt with. So I haven't investigated that enough to have a view.

  • 11:33:52

    REHMYou described your approach to rulemaking as regulatory money bowl. What does that mean?

  • 11:34:01

    SUNSTEINWell, the idea is that in baseball some of the best teams have abandoned anecdotes and intuitions and impressions and replaced it with careful statistical analysis. So the beloved Boston Red Sox in some of the years of success were statistics-focused. And that is a good way of trying to make sure that you really get the biggest bang for the buck. If you're hiring a player who kind of looks great and has a terrific swing, but he doesn't get on base much, there's a problem. If you have a guy who's kind of short and stocky and maybe he's 5'7" but he's on base all the time, you want that guy on your team.

  • 11:34:47

    SUNSTEINAnd regulation you can think of the same way. there are some that look really good, that sound good, that people, you know, good faith hear about and they think I want that one. But it's a little like that good looking ball player who doesn't get on base much. And there are other regulations that look kind of ugly and no one's going to get excited about them, but maybe they're going to save 200 lives a year and not cost very much.

  • 11:35:15

    SUNSTEINSo the effort to get very disciplined on the facts, the human consequences, the costs and the benefits, seeing cost not as some abstraction like some business guy in an office is going to get hurt, but as costs having human impact that is often harmful for people who really don't need that harm. And benefits too can save lives. Our air pollution rules are doing that every day. That is a way of disciplining the analysis and stopping the interest groups on both sides, the intuitions, the general impressions from dominating the regulatory process.

  • 11:35:55

    REHMAll right. I want to open the phones, take one call before we go to a break. Adam in Raleigh, N.C., you're on the air.

  • 11:36:08

    ADAMHi there. Thanks, Diane and thanks for your show.

  • 11:36:10

    REHMSure.

  • 11:36:11

    ADAMYour guest mentioned the observational economics, or what the professionals watch people. And in college I was taught frequently about an example from Sony. They did a marketing experiment and they did a bunch of different questions and tests over several days. And at the end, as a reward, they let people who had participated in the survey choose whether they were going to design these Sony -- remember the little personal radios when they first came out?

  • 11:36:46

    ADAMThey were -- there was a pile of black ones and a pile of yellow ones. People got to pick what they...

  • 11:36:53

    REHMOkay, I'm losing you, Adam. Not sure I could get that.

  • 11:36:59

    ADAMCan you hear me?

  • 11:37:00

    REHMJust barely. I'm afraid we're going to have to let that go. But I gather the gist of it was, with the Sony experiment, people were asked what they wanted when they had a choice. They picked something totally different. Think about that for a moment while we take a short break. Cass Sunstein is with me. His new book is titled "Simpler." And we'll be right back.

  • 11:40:03

    REHMAnd welcome back. Cass Sunstein is with me. He served as President Obama's regulatory czar between 2009 and 2012. His new book is titled, "Simpler: The Future of Government." Here's an email from Peter in Huntington Woods, Mich. "What is the connection between lobbying and simpler government?"

  • 11:40:36

    SUNSTEINYou know, that's great. Thank you for that. Simpler government can be a safeguard against lobbying and here's why. The lobbyists often benefit from complexity. They can hide something in a regulation or they can kind of put some little term in a law that people don't see because the whole thing's so long and complicated. So one thing we did, one of the small things I did in government, with others, is to require every long and complex rule to have an executive summary that everyone can understand at the beginning. And it's really a tiny step, but it's been a wonderful safeguard because the risk is that when the executive branch contexts the risk of law as being maybe lower than in Congress, that someone can put something in there that can be not so good and it's not transparent. Transparency is a safeguard.

  • 11:41:28

    REHMHere's an email from Luke, who says, "I am deeply afraid of all moral, judicial and political decisions being boiled down to cost benefit analysis. I'm taking my cues from criticisms of Michel Foucault when I say, it's dehumanizing in its taking all spiritual entities and transforming them into a quantifiable number to manipulate a side from those more ephemeral views of intrinsic worth ethics, etcetera.

  • 11:42:13

    SUNSTEINYou know, that's also a great question. And the president's executive order from 2011, with the charming name, Executive Order 13563--rolls off the tongue--it does place a big emphasis on costs and benefits, but it takes on a point very much like that referred to by the questioner, which is human dignity, equity, fairness and distributive impacts. And of those four, that quartet of non-monetizable things, the one I'd like to put in bold letters is human dignity. It's not easy to turn that into a monetary equivalent, but for rules that involve people who are HIV positive coming into the United States, which we did, rules that allow disabled people to have access to bathrooms without the assistance of their friends, and there are other. Human dignity is emphatically a value and it's not just a dollar equivalent.

  • 11:43:10

    REHMTo St. Louis, Mo. Good morning, Darren. You're on the air.

  • 11:43:16

    DARRENGood morning, Diane. Good morning, Cass. Actually my question was very similar to the previous question, the person who took from Foucault, but in cost benefit analyses that rely heavily on (word?) numbers, it kind of naturally gives way to Piscean analysis or, you know, simply economics of money. While you mentioned a couple things about dignity, again, judging from numbers, can one really, truly even see from top down in making reality analyses a human economy? Builds up relationships for example, that cannot be even really compared in these cost benefit analyses and regulation.

  • 11:44:02

    SUNSTEINI think the only way to approach that good question is to look at particular regulations. So we did a regulation that is going to reduce the incidence of rape in prisons, something that Congress required and that will have a big impact. And that one's a good one for you, where to the think of monetary equivalent of a rape eliminated is, let's just say, challenging. But you have other cases where there may be illnesses and accidents avoided, let's say, and it's good to know how many. Because if you have a rule that's going to cost $1 billion and going to eliminate, let's say, two illnesses and they're not so bad, then that's not really the best allocation of private resources to require a $1 billion expenditure for two not-so-bad illnesses.

  • 11:44:58

    SUNSTEINAnd if you agree with me on that then we're pretty much in the game of comparing costs and benefits. If, by contrast, you have a rule that costs -- and this is not so unlike some of the ones I saw -- costs $80 and save 200 or 300 lives, that's looking pretty good and it should go forward. And if you agree with that, then you're doing some sort of cost benefit analysis.

  • 11:45:19

    REHMThanks for calling, Darren. To Rockford, Ill. Good morning, John.

  • 11:45:25

    JOHNYes, hello. I just had a quick -- wanted to ask your guest for his opinion on the Intuit Corporation, the makers of Turbo Tax. In Peoria at a store yesterday, about them fighting the simplification of the IRS actually preparing statements for people so that folks with like 1040EZ's wouldn't have to prepare their own taxes. They would just be prepared and if you agreed with what it was, then you'd be done. And it would save a lot of trouble.

  • 11:46:01

    JOHNAnd, of course, the Intuit Corporation's using some, you know, heartfelt argument that this takes away a taxpayer's, you know, ability to understand what he's paying for and, you know, implying that they would just be duped into paying whatever tax was presented to them. And I’m pretty sure that it's really that they just want to keep people using their product.

  • 11:46:23

    REHMWhat do you think, Cass?

  • 11:46:25

    SUNSTEINI don't have anything particular to say about that corporation, though it is true that often companies, whose economic interest is at stake, make arguments that are consistent with their economic interests. I do think that the Ready Return, which is California's name for what you're describing, it's an interesting program where people just get their tax returns filled out, eligible people. And then they can look it over and sign it or correct it. I don't know if that's something that's ready for prime time at the national level, but I know the chairman of the council of economic advisor's Austin Goolsby wrote on as favor. And it's certainly worth thinking about.

  • 11:47:09

    REHMYou co-authored a book called, "Nudges." What are nudges? Give me an example.

  • 11:47:17

    SUNSTEINOkay. So a nudge could be like a calorie label, so that once you go into fast-food restaurants they're calorie-labeled so you know what the caloric intake is of various foods. That's a nudge. A nudge could be a warning. So if you're going to the beach there's a warning that tells you, you know, you shouldn't really be swimming in certain conditions. A nudge could be automatic enrollment in a savings plan, the sort that many employers are now doing. A nudge could be something that a lot of people are receiving, which is a notice when their electricity bill comes of how much it cost compared to that of other people in their neighborhood, how much they're spending and whether they're spending a lot or a little on electricity.

  • 11:48:03

    SUNSTEINSo what unifies these various different initiatives is that they are nudges in the sense that they're not mandates, they're not forcing anything, they're not commands, they're not bans, but they are little steps that, while preserving freedom, push people very lightly in a certain direction.

  • 11:48:26

    REHMSo Mayor Bloomberg's ban on 16 ounce drinks would not be a nudge.

  • 11:48:36

    SUNSTEINNo. That went beyond a nudge, in the sense that it didn't just inform or have a default rule. It had a requirement.

  • 11:48:44

    REHMDo you think it was a bad idea?

  • 11:48:46

    SUNSTEINI don't think it was a bad idea because it went beyond a nudge. There's a place for things that go beyond nudges, assault and battery is banned, we don't just nudge against them. I want to know more facts about the likely consequences of Mayor Bloomberg's initiative before forming a judgment. I do applaud him for focusing attention on a wide range of public health problems, including the problem of obesity. So the fact that he's drawn national attention to that and that his own administration is committed to combating childhood obesity in particular, that's admirable.

  • 11:49:26

    REHMNow, compare and contrast that to the idea of putting a skull and crossbones on a package of cigarettes.

  • 11:49:35

    SUNSTEINYes. We did, in the Obama administration, issue a rule and conjured some judicial resistance for graphic warnings on cigarettes. And that is a nudge and I think it's a good idea and Congress basically required it and other countries are doing it. It looks like it has the promise to save a lot of lives.

  • 11:49:56

    REHMIt's interesting because a lot of buildings around the country have insisted that people who smoke move farther and farther away from those buildings. Would you call that a nudge?

  • 11:50:12

    SUNSTEINNo. That goes beyond a nudge. So if you say people can't smoke in certain places that is often a good thing in terms of public health and in terms of not irritating people who are trying to eat or do their job, but it is not merely a nudge.

  • 11:50:32

    REHMAll right. Let's go to Mayflower, Ark. Good morning, Richard.

  • 11:50:39

    RICHARDGood morning. Hello?

  • 11:50:40

    REHMGo right ahead, sir. You're on the air.

  • 11:50:44

    RICHARDYes, ma'am. I work for a water transfer company here in Mayflower. And I got to see the pipeline bust or the break in the line up close and I'm just concerned that this pipe was laid in 1948 and it's a 20 foot section along the seam of the weld. I'm just curious, surely this is not the only split in this line that's extended as far as it has. I mean, surely the line is going to break at other points.

  • 11:51:12

    SUNSTEINWell, it sounds like you know a lot more about that particular than I do. So I would defer to you.

  • 11:51:18

    RICHARDWell, I mean, if it was laid in 1940, it's 65 years old, I'm thinking, wow, the weld is not -- obviously it's going to be seeping or breaking or something. And as long as it's below ground -- and I've been a long-time resident of Lolly, which is Mayflower and we never knew there was a pipeline running underneath here. We didn't know. I mean, I've been here all my life, 50 years. I never knew there was a pipeline.

  • 11:51:39

    REHMAnd that gets to the whole question of pipelines running all through this country that may be aging that have the potential to leak, but it also gets to the question of infrastructure, money going there or elsewhere, cost benefit analysis.

  • 11:52:04

    SUNSTEINYes. So I think one thing I really appreciated within the federal government, there are technical experts who aren't, you know, democrats or republicans. They just know their business. Now, not everyone is perfect, needless to say, and they do make mistakes, but the question whether a pipeline is, you know, a serious risk because it's old, that's a technical question. And it should be answered by people who at least get the facts straight.

  • 11:52:33

    REHMIndeed. Thanks for calling, Richard. To Mandarin, Fla. Hi, Jennifer.

  • 11:52:39

    JENNIFERHey, fascinating topic. I mean everybody hates regulation, but where would we be without it. And it's nice to see how it's evolved, you know. Makes you have a greater appreciation for being within the rules. So thank you for that. I was directed to look at some information on a You Tube called Agenda 21. And I kind of freaked out after looking at it. It's apparently about a United Nations meeting that I'm thinking it was 10, 15 years ago, that had a lot to do with zoning regulations and land-use regulations that are actually already implemented in the United States and in many places in the world, that basically, eventually nudge and force people to live in closer and closer proximity to one another by disallowing them to live in other areas.

  • 11:53:31

    JENNIFERAnd it seems like the goal is just a highly dense centers of population. So can you address this at all? I mean it kind of, you know, apparently it's already implemented at very basic levels.

  • 11:53:46

    SUNSTEINWell, I know there are a lot of You Tube videos and I think they should be taken often with grains of salt. So what you've described, I'm not familiar with any program of that kind.

  • 11:54:03

    REHMCertainly in China there is that effort to move people from the rural areas into more urban.

  • 11:54:12

    SUNSTEINI'll certainly take your word for it. I guess what I'd say about regulation in general and people not liking it in the abstract, is our food supply is pretty safe in the United States and that's partly because of good work making it safe.

  • 11:54:25

    REHMAnd you're listening to "The Diane Rehm Show." And finally to Orlando, Fla. Good morning, Joseph.

  • 11:54:36

    JOSEPHGood morning, Diane.

  • 11:54:36

    REHMGo right ahead, sir.

  • 11:54:37

    JOSEPHYeah, I just happen to tune into your program a few minutes ago. And it's on a subject that I think is relevant to what I've been mulling over. I work on a campus here, Seminole State College, and my understanding is that they voted recently to begin in August some kind of very restrictive rules about smoking on campus. In fact, my understanding is it's going to be actually illegal to smoke anywhere on campus, including in your own car. And they're prohibiting even chewing tobacco on campus. So I'm a little bit flabbergasted at that. I mean one scenario that I would, for example, would be like what if there's a veteran coming from Afghanistan, who has a smoking habit and he wants to smoke a cigarette, they're going to tell him that it's illegal, you can't do that?

  • 11:55:25

    REHMInteresting.

  • 11:55:27

    SUNSTEINWell, I don't have any particular comment on any college campuses practices. And, you know, surely...

  • 11:55:35

    REHMBut is that legal?

  • 11:55:37

    SUNSTEINOh, if a campus wants to impose restrictions of that kind, unless there's something in state law that forbids it, it should be entirely legal. I think the broader point is there's always a risk of overshooting the mark. And this may be an example. But the smoking problem is really serious. Over 400,000 people are killed in the United States every day. That's a staggering number. And whenever we think about potential overshooting our efforts to protect people, especially if it's a private institution -- I'm not sure if it is -- the risks are lower, at least, then when it’s the government. But we should also focus on those 400,000 people and how to get that number down.

  • 11:56:16

    REHMCass, one last topic, if you could, talk about, briefly, and that is decision by default.

  • 11:56:26

    SUNSTEINOkay. The idea is that with respect to cell phones, rental cars, mortgages, computers, there are default settings everywhere. They may involve what happens if you're late. They may involve with a payment. They may involve your privacy protections. They may involve what kind of savings plan you're in. They may involve whether you're in a healthcare plan or not. They may involve whether you get insurance. So all over we are effectively defaulted into certain outcomes which means that if we don't do anything, that's what's going to happen. And frequently doing nothing is exactly what we're going to do.

  • 11:57:05

    SUNSTEINSo the default setting is immensely important for many of the domains in which we operate and we need to get the default settings right.

  • 11:57:15

    REHMCass Sunstein, professor at Harvard University School of Law. His new book is titled, "Simpler: The Future of Government." Thanks for being here.

  • 11:57:29

    SUNSTEINThank you. It was great, thank you.

  • 11:57:31

    REHMAnd that's for listening all. I’m Diane Rehm.

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