TCS Daily


The Scarcity of Security

By Veronique de Rugy - January 10, 2006 12:00 AM

The insurance industry estimates that the U.S. cities facing the highest risk of terrorist attack are New York, Washington, Chicago, and San Francisco. Other cities at a high risk of attack are Los Angeles, Philadelphia, Houston, Seattle, and Boston. All other US cities are classified as low risk. Yet until now, the Department of Homeland Security's (DHS) grant program directed at "high risk" areas was funding over 50 cities. If the insurance industry priced automobile policies the way DHS allocates homeland security funds, it would be charging a 20 year old male in a convertible the same rate as a 45 year old soccer mom in a minivan.

The good news is that this is about to change.

On Tuesday, DHS Secretary Michael Chertoff announced a shift in the way the Urban Area Security Initiative (UASI) -- a grant targeting the "most at risk cities" -- is allocated. Chertoff explained that in FY2006, the grant will distribute $765 million based mainly on risk. Since lawmakers tend to treat homeland security funds not as a means for protecting our country's most vulnerable areas, but as a way to divert more cash to their own states and districts, the new structure of the UASI is a welcome development.

Interestingly, the original UASI was designed based on a risk evaluation. Eligible cities were identified by population density, the presence of critical infrastructure, and the existence of a credible threat. Early in 2003, Congress announced that it would pay a total of $100 million to seven cities -- New York, Washington, Los Angeles, Seattle, Chicago, San Francisco, and Houston -- that had made the "high threat list." This plan was consistent with the insurance industry's assessment.

But immediately after the plan was formulated, former DHS Secretary Tom Ridge and members of Congress started receiving calls from city officials who felt they had been left out unfairly. As a result, the list of qualifying cities started to expand. In May 2003, the number of most-at-risk cities had grown from 7 to 30. In a few months, the pool of money increased from $100 million to $700 million. Then in 2005, the DHS announced an even longer list of 80 cities and mass transit agencies, including relatively low risk cities like Indianapolis, Louisville, and Columbus, and a budget of $885 million. To make matters worse, the absence of goals to guide expenditure has resulted in some questionable uses of the grant money such as leather jackets and incompatible radio systems.

The new reform put forward by DHS addresses the problems of the current system. First, DHS will use more and better data in its assessments and has refined its criteria for assessing risk and deciding which cities will be eligible for funding. It has added several criteria, such as "level of investigative activity and enforcement" and "mutual aid cooperation." Second, and maybe more importantly, each eligible city will have to make the case for its funding request by submitting an investment justification.

The changes improve the status quo in three ways. First, DHS will allocate money based on risk rather than politics. Second, the number of eligible cities/regions will go down to 35. Third, a high-risk city unwilling or incapable of presenting a cost-effective plan for how it will spend the federal money could receive less funding than a lower-risk city able to make a strong case for its investment. This should be a strong incentive for city officials to assess their needs seriously and plan carefully how to spend their grant. It also represents a commitment from DHS not to send more money than it already has to cities that will ultimately waste it on useless projects.

These are significant improvements. However, a fundamental question remains. Why should DHS hand out a considerable portion of its budget in preparedness grants to state and local governments? The mission of DHS is first and foremost to prevent another September 11th, not to subsidize local projects. States and local communities should be in charge of most of their preparedness efforts. Local control would guarantee more cost-effective policies, and it would end the dangerous illusion that has captivated this country since September 11th, that checkbook security is anything more than politics as usual.

But if we insist on involving the federal government in local preparedness, shouldn't that effort be concentrated where it would have the most effect? DHS has taken a step in the right direction by limiting the UASI funds to only 35 areas, but those areas comprise more than 100 cities. DHS should go a step further and focus solely on the 9 cities identified by industry experts as the most likely terrorist targets.

Despite of these reservations, DHS's reform is a good one. Yet it won't be accepted easily. Officials from smaller cities will claim that they too deserve a share of the anti-terrorism aid because terrorists could strike anywhere. That's true. Timothy McVeigh did launch his attack in Oklahoma City. It is not true, however, that the probability and consequences of a terrorist attack are the same everywhere in the country. Moreover, giving a large number of cities a big chunk of federal tax dollars is not the best way to protect the country. In fact, that strategy will make Americans less safe. If we try to defend everywhere, we will end up defending nowhere. As they get ready to fight DHS' move from political concerns to security concerns, Congressmen and Senators should remember that.

Veronique de Rugy is a Research Scholar at the American Enterprise Institute.

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3 Comments

Scarcity of Security
As far as I'm concerned, there will be no scarcity of security as long as we clone Jack Bauer. And Tony Almeida too. And Chloe and Edgar.

Only 700mil, it will take that much to secure NYC.
This whole grant thing is pointless. The tons of money wasted in these projects is so huge that 700 mil will be eaten up without any change in the real security of these areas. I doubt that NYC could be secure adequately for that much.

The residents, businesses and local governments need to secure their own property. That is always the most effective and cost efficient means to provide security, disaster relief and just about any other service imaginable.

What are the chances of being killed by a terrorist?
What are the chances of being killed by a terrorist?

What are the chances of being killed it an auto accident?


“The whole aim of practical politics is to keep the populace alarmed--and hence clamorous to be led to safety--by menacing it with an endless series of hobgoblins, all of them imaginary.”
H.L. Mencken

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