The Shadow Economy of Compliance

I have a big backlog of emails from the college saying things like “change your email password,” and “take this sexual assault training course,” and “you have five days to find that anteater a new home, because it can’t live in your dorm room.”

Usually I get annoyed at the college for these things (my anteater doesn’t want a new home), but in the case of the sexual assault training required for athletes and organization leaders, it’s not Hamilton’s fault.

Last summer New York State passed the “Enough is Enough” law on college sexual assault, which included, among other things, the mandatory sexual assault training that a lot of us got an email about. The law has its merits and problems that people more qualified than me can discuss. But what surprised me most is that a lot of corporations take home big paychecks when laws like this are passed.

Every time a law puts new regulations like mandatory training on colleges and universities, companies rush forward to sell the schools exactly what they need in order to comply.

The phenomenon isn’t reserved to the purveyors of training courses alone. There’s an entire shadow economy that deals in the “value” of being less inconvenienced by regulations.

Take the tax industry, for example. Why do we hear repeated calls to simplify the tax code while it remains as complex as ever? In part it’s because the parties can’t agree on reforms, but in part it’s also because a huge lobby of tax lawyers has an interest in keeping the tax code too difficult for the average person to handle.

In the case of new sexual assault laws, colleges like Hamilton have few choices. They can move their own resources around to try to create a program that may or may not adequately comply with the law, or they can shell out money to a specialist who will cover compliance for them. The result is that a lot of companies are profiting off of the sexual assault issue because it’s cheaper for a college to hire it out than to try to take care of it on its own.

NPR took note of the trend this past August. “It was once a tiny niche market,” writes Tovia Smith, “but it is now an exploding industry with everything from fingernail polish that detects date-rape drugs in drinks to necklaces that hide mini panic buttons—and all kinds of crash courses on how to get and give consent.”

I spoke with Hamilton’s Title IX Coordinator, Lisa Magnarelli, who explained that Hamilton has used a company called CampusClarity to provide pre-orientation training on sexual assault for the past three years. “The program receives positive reviews from first-year students regarding its content and interactivity,” Magnarelli said. “Other programs were considered, but none seemed to have the same level of production or engagement.”

For $8,000, Hamilton acquired a site license that gives the school unlimited access to CampusClarity’s training modules. That’s cheap compared to some other programs. One alternative, called Haven, is a 45-minute online course for which most schools, according to NPR, pay between $10,000 and $20,000.

New laws impose these costs, and in many cases it’s up to the schools to figure out how to comply with vague regulations. If paying for a training program is a guaranteed way to avoid harsh government fines, then it makes sense that schools are willing to hire companies like CampusClarity.

This is not to say that we should oppose laws like “Enough is Enough” just because people are profiting off of them. But we should be wary of the influence of money interests in these issues. As this industry grows, we can expect it to become a powerful lobbying interest. Will it have students’ best interests in mind? We’ve yet to see if the programs that they’re selling have a positive effect.

You can’t entirely fault this industry for providing a service where it’s needed. The ultimate responsibility is on the federal and state governments that passed the regulations and created the compliance economy. There remains plenty of room to question whether the compliance economy is providing real value by helping to solve the sexual assault problem, or if it’s profiting off of empty promises of improvement.

Other questions remain regarding the laws themselves. Does the displacement of emphasis onto colleges (where the money is) mean that we’re neglecting the law-enforcement side of sexual assault? Do the increasingly convoluted definitions of consent actually reduce sexual assault, or do they just make it easier for companies to sell explanations? The answers will, hopefully, become clearer over time.