As a sophomore in college in November of 2000, I appeared in the student newspaper for the University of Southern California exactly once, voting for George W. Bush for president. That night, as my roommate played “We Are The Champions” when he was slightly prematurely called as the winner, I had to fight off a mob of angry liberals at the door of my dorm room while my roommate ran away. For the next few weeks, as the election drama in Florida played out with hanging chads and Jewish voters who mistakenly chose Pat Buchanan as their president because they were confused by the design of the ballots in Palm Beach County and recounts and Supreme Court decisions, I felt deeply embarrassed to have come from Florida, given the fact that my state was a laughing-stock to the whole nation, indeed the whole world. This was largely because the eyes of the nation and the world were turned towards the incompetence of the state where I had grown up, even though I had been born in Pennsylvania.
When I started working for the company I work for, over two years ago, I was told by one of our company’s executives that the eyes of the nation would be looking for Oregon’s state website as a model given that the website had been in the works for more than fifteen years. My coworkers and I were told that the project was too big and too expensive to fail, and that our state would be a laughingstock if all that money and all that time came to nothing. And that is precisely what happened. Despite quirky indie pop songs telling people to go to the Cover Oregon website to get their health insurance, the website was fatally flawed in that no one could actually apply for insurance through the website at all during the first Open Enrollment period of what is popularly referred to as Obamacare. After the first year’s disaster, Oregon announced that it was abandoning its state website and going with the not-as-broken federal insurance marketplace. The debacle, as can be imagined, did indeed make our state a laughing-stock, showing up as an extended clip in a Last Week Tonight episode where we were mocked, and ending up in a host of lawsuits between Oracle, the company that designed the irredeemably broken website, and the state of Oregon.
As it happens, the case is making a precedent that may be of wider importance. Recently , the Oregon Supreme Court ruled that not only could Oracle be sued as a company for their incompetence in designing a website that failed at its one purpose, despite many millions of dollars of expenses and large amounts of man-hours over the course of the many years of website “development,” but that the State of Oregon could also sue the executives of Oracle individually, whether or not they were still working for the company in the aftermath of the disaster. As might be expected, industry pundits have warned readers in Oregon that this could easily backfire, as companies who could be sued collectively while their executives are sued individually “in their personal capacities” for problems may be reluctant to do business or sign contracts with a particular state. This is a fair warning, but it is not likely to be heeded, largely because a problem that massive is going to need a sacrificial victim. One does not make a government a laughing-stock without paying a very high price, as elected political officials and unelected bureaucrats are not widely known for their sense of humor or their ability to take themselves less than completely seriously.
This is not the only matter of potentially serious interest for Oracle, as they have also been investigated within the past few years by federal officials  for bribing several African nations in order to sell their database and application software in those countries. The company, and its boosters, argue that this is merely the cost of doing business, given the state of corrupt countries around the world. The fines are often seen as being like taxes, since they only result in the cost of a few millions of dollars when the markets in question have a possible market size in the hundreds of millions of dollars, and since no jail time results from these fines. Nevertheless, given a corporate culture that tends to view corruption with a certain cynical acceptance, the fact that they have now cheated Oregon out of many tens of millions of dollars as well as considerable costs in reputation is likely to be viewed with a strong sense of hostility by those with a desire to stick it to companies.
The ultimate question, though, is what can states do to prevent themselves from being made a laughing-stock. Once a given jurisdiction is turned into a running joke, the ridicule never really goes away. A few examples should suffice—the Hatfield and McCoy duels were more than a century ago, but people still bring them up when talking about West Virginia. The movie Deliverance is decades old, but people still play the Dueling Banjos scene as a way of ridiculing people that come from the South. Restoring one’s good name after it has been threatened and imperiled by the actions of others is difficult and uncertain business, and some people never give anyone or anything a second chance at a positive impression. Prevention is, as is generally the case, the best cure, but how does one prevent the incompetence or the malfeasance of others, when the losses from such matters are so deep and so threatening? Some trust is necessary, since one cannot do everything by oneself, but that trust can be costly when it is broken. Let us hope the people of Oregon do not suffer long for this.