Another Accident

36 out of 39 passengers were killed in a highway collision between a bus and a methanol-loaded tanker in Shaanxi. The accident happened at 2am in the morning, most people were burned to death in sleep. This is neither the first nor the biggest traffic accident of its kind in China in recent years. Overload, overspeed and fatigue are three main reasons that keep experienced drivers from normal operations of automobiles, let alone handling emergencies. To maximize the profits of transportation, many bus companies, long-distance transporting ones in particular, choose to load more passengers than allowed. Meanwhile, to accompany the schedule of passengers, many coaches operate at night, known as "red-eye buses." Drivers who own salaries by distances also have motivations to finish the same distance within less hours, which end in pervasive overspeed.

After the news was released, local governments responded very quickly and claimed to regulate the passenger transport industry soon. There is rumor that one of the plans is to cancel "red-eye buses". This policy, if put into effect, may be effective in keeping tired drivers from working all night, but will make it less convenient for passengers as well as exacerbating daytime traffic congestion. Moreover, if transport companies can't afford the increase in costs by replacing red-eye coaches with those in normal hours, they may resort to further overloading passengers in each bus. In this case, risks are not reduced, but transferred from fatigued driving to heavy overloading.

From the perspective of economics, government should facilitate effective allocation of resources rather than hindering them. Night transportation has been proved effective and cost-saving. (Just think of how much more you need to pay on hotels if red-eye flights across coasts are cancelled.) What really contributes to the accident is the long hours that drivers need to work. If two drivers can divide the work originally assigned to one, the accident rate may be reduced accordingly; or if a driver can get enough rest before setting off, he may suffer less from forcing himself to drive during sleeping hours. Of course this will increase the operation costs for transportation companies, however given the potential damages caused by fatigue drivers, these costs may well worth it.

Therefore it's very interesting to see that Shaanxi government did not even discuss the feasibility of correcting the market by issuing a upper limit on each driver's working hours, but went directly for sub-optimal. The reasons behind the decision could be: (1) the concerns over administrative capacity: it's much easier to ban red-eye buses than to regulate drivers' working hours; or (2) trying to show sufficient determination to eliminate similar accidents in the future as this one has already drawn too much attention on a provincial government, thus they have to look tough to the public. In either case, it's just another typical example of how the government are steered by media in decision-making and successfully messes up the market again.

It is an encouraging change for the Shaanxi Government to respond to media and the public quickly, and show some senses of responsibility for public service. However there is still a long way ahead for the governors to understand the role of government in a market-oriented economy and how to balance market leverages and government regulations. When Republicans and Democrats are in the lengthy fight on the size of the government, we are just starting to draw the line between the government and the market. A little too late, but good to have a start.