Industries Could Take Cues From Hollywood on Self-Control

Then there are the health insurers, who spent years convincing Congress they could save money and improve quality by aggressively managing the medical care of seniors with serious or chronic illnesses. So how could they not see the threat to the entire Medicare Advantage program when competitors began showing up with un-managed care plans peddled by fly-by-night independent brokers?

As it happens, a vehicle exists for restraining bad actors and preventing unethical practices from taking hold in an industry. It's called the industry association. Most of them are right here in Washington. Most make a pretense of maintaining industry standards and promulgating codes of conduct. And most are led by experienced executives who are paid big money to keep their industries out of trouble.

Unfortunately, too many associations have come to believe it's not their place to police the behavior of their dues-paying members. After all, what looks to some members like unethical behavior looks to others like product innovation or aggressive marketing. And for the heads of these associations, stirring up division within the ranks hardly seems like a strategy for hanging on to a cushy job.

Except, of course, when it is. Perhaps nobody understood that better than Jack Valenti, who died last month after decades of representing the big Hollywood studios in Washington. Jack took a back seat to nobody when it came to aggressively defending the interests of his clients. And nobody was better at keeping himself in the good graces of his members.

But when the studios found themselves in a competitive race to the bottom in the smuttiness and violence of their movies, Jack was clever enough to foresee the likely political and regulatory backlash, and convincing enough to persuade his members to accept a movie rating system that has, in effect, become a form of industry self-regulation.

Mortgage brokers, student lenders and health insurers are only now realizing what Jack Valenti learned long ago: The purpose of a trade association is not simply to protect its members from government, but to protect its members from themselves.

Steven Pearlstein will host a Web discussion today at 11 a.m. athttp://washingtonpost.com. He can be reached atpearlsteins@washpost.com.