Richard Posner: "What Our Spies Can Learn From Toyota"

What Our Spies Can Learn From Toyota
Luis Garicano and Richard A. Posner
The Wall Street Journal
January 12, 2010

Until recently, the United States had become complacent about terrorism. The general view was that al Qaeda was on the run and Islamic terrorism was a receding threat. We now know better.

A string of attacks by Islamic terrorists—an officer murdering his fellow soldiers at a U.S. army base, a passenger's attempted bombing on a Detroit-bound airplane, and a double agent's suicide bombing a CIA base in Afghanistan—reveals the continuing and growing danger of Islamic terrorism. Hostility to the U.S. appears to be increasing among Muslim populations, and, with it, the number of potential terrorists. It is alarming that none of the three attackers—an American, a Nigerian and a Jordanian—was from one of the traditional hotbeds of terrorism.

In the case of the first two attacks, information that should have alerted the security services to the danger of an attack was in their hands but was not acted on. And this despite the restructuring of the national intelligence system after the 9/11 attacks. These failures are only the latest evidence that the post-9/11 reforms have not been a success.

Real reform of complex institutions is always hard, but it is possible. Consider a storied, historic, indeed iconic American institution that had developed an internal structure so convoluted that information did not flow through it—fiefdoms abounded, and duplication and delays were the rule. After many failed efforts at reform, only the threat and actuality of bankruptcy forced this institution to slim down, streamline and focus.

We are referring, of course, to the U.S. auto industry. The domestic automakers' organizational structures were notoriously complex and top-heavy. While Toyota had been selling the same car worldwide, Ford had insisted that American consumers would not buy the cars successfully produced by Ford for sale in Europe. As a result, every stage of production from R&D to actual manufacturing was duplicated in the two markets.

Faculty: 
Richard A. Posner