TCS Daily

Risks, Benefits and the Terror War

By Charlotte Wuerzig - December 29, 2004 12:00 AM

Doubts about the Terror War have taken the strangest forms of late. Many who are against the war in Iraq and critical of the War on Terror have begun using a favorite tool of fiscal conservatives to question military and homeland security expenditures. And it would seem to be a clever and plausible move (albeit a little hypocritical). In short, critics are asking whether we should spend so much money on the military and homeland security. Is it overkill -- or more aptly, perhaps, over-save?

Conservative risk-cost-benefit analysis arguments usually go like this: A certain Superfund initiative has the likelihood of saving one human life for every $200,000 spent. Now, given that we have a finite Federal health and safety budget, wouldn't it make more sense to spend that $200,000 on something that could save 100 lives? For example, if the government were to put up guardrails near unsafe curves around the country, wouldn't we increase the likelihood of saving more lives? Risk analysts say: if you're going to spend the money, save more lives. It's a simple utilitarian calculation, but it makes a lot of sense when there's a bottom to the federal pot. In fact, one can apply risk analysis to a variety of environmental issues. Ironically, the people who care the most about the environment are usually the ones who turn the deafest ears to this kind of rationale.

But maybe their ears are not as deaf as we think, as many who are against the Iraq War and aspects of the War on Terror are turning the rationale of risk analysis to current security expenditures. And this isn't a bad idea at the face of it. The questions become: how many American lives will be saved by spending billions over in Iraq and Afghanistan, as well as billions on a costly Homeland Security bureaucracy (not to mention soldiers' lives)? Couldn't we save more lives spending that money somewhere else?

OK, let's back up. While I'm quite happy to see questions of risks, costs and benefits coming from unusual quarters, I don't believe such criticisms can be employed in quite the same way in the case of national security. The disanalogies come in comparing the relevant aspects of the different domains -- i.e. the aspects of the environment versus aspects of national security.

First, in the former domain, the threats are usually static. Lead-level in the soil of Aspen, Colorado is a known, calculable risk that is not really subject to change into the future. In the latter domain, the threats are dynamic. Why? Call it the human factor. The economic conditions, political structures, funding networks, emotions, resolve and animus on the part of current or future Jihadis is in constant flux -- and thus the threat is indeterminate in many respects. One thing we can predict, however, is that complacency and inaction will embolden our enemies. Thus complacency and inaction are sure to increase the dangers. Terrorist threats have a kind of "multiplier effect," where toxins in soil etc., in most cases, do not.

Consider the argument that says scaling back of military and intelligence spending during the Clinton years made 9-11 more likely, not less. In such a case, there were consequences of complacency and inaction. For al Qaeda, the United States was perceived as a "paper tiger" both in its unwillingness to see military endeavors to their conclusions, and in its inertia with respect to prior, smaller-scale terrorist strikes (which should have served as warnings). There is some merit in these arguments, even though one should doubt any Administration (Clinton's or Bush's) could have truly come to grips with such dangers until they materialized that September morning. In any case, we have learned a lot since 2001, and one of things we now know is that inaction and complacency is a particularly bad option. And in the future, a few more successful terrorist strikes could change the dynamic considerably.

Therefore, in the case of national security, it's really not a question of trying to tally up the average number of lives lost in terrorist attacks over the last twenty odd years and calculate that number against the anti-terror expenditures in order to derive a cost-per-life figure to apply in the next budget. In the case of terrorism, there are so many more variables; and the variables shift as the relevant parties act (or fail to act).

But suppose for a moment we were going to take such a tack. We would have to do some pretty serious Monte Carlo-type projections just to get a ballpark estimate of what 3000 productive lives would have yielded in the future, not to mention their network effects on the economy. And even Monte Carlo couldn't help us with calculating the net benefit of productive lives not taken thanks to current "expensive" security measures. Now, apart from 3000 dead, think of the billions of dollars lost, caused by Americans too spooked to fly as many as three years after 9/11. The airline industry continues to suffer. And that's just one sector of the economy. What were the systemic, geometric effects of that day on the US economy generally? Big numbers, to be sure. To prevent further such events is worthwhile as we begin to try and reckon with the nebulous costs of future acts of terrorism. And while we might arrive merely at intuitive conclusions, a couple of hundred billion dollars may start to look like small potatoes in the grand scheme.

Here's another way of looking at it: Imagine what the world might be like today had the US not engaged in an arms race with the Soviet Union. We could have been left with a Soviet Empire extant in the 21st Century, or worse, a nuclear holocaust. In the eighties, however, the US ran deficits high and military expenditures were close to 6 percent of GDP. Since the Soviet economy was inherently self-corrupting, the system was bound eventually to fail as the Soviets maintained a policy of keeping up with the United States' nuclear program. The end of the Cold War yielded a decade of relative peace. How much, in dollar terms, was such a peace worth to us? In any case, such future benefits could not have fit easily into the calculus of risk-cost-benefit analysis. Indeed, the point is not that we could have predicted with the utmost certainty the time and place of the Soviet Union's collapse, but that the only credible strategic option was to engage in the arms race -- real costs notwithstanding.

Likewise, we will not really ever be able to tell how many lives we will save because homeland security has been beefed up. We also cannot yet see whether Iraq will thrive as a liberal democracy and whether the project will result in overall Middle Eastern political reform. But these incalculables, such as they are, represent the promise of a future peace whose current investments will be but drops in the bucket if the vision does succeed. If these grand investments in pre-emption and security fail, I'm sure there are a lot of people who will claim 20/20 hindsight. But thankfully, no one will be able to claim hindsight about the future returns (good or ill) of inaction and complacency.

Charlotte Wuerzig is a writer in the Washington, DC area.


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