Are We Overspending on Stopping Terrorism?

Some caution is obviously understandable; no one wants to see another attack on U.S. soil. But according to our latest research, based on conventional methods of risk assessment, in order for the post‐​9/​11 increase in domestic homeland security expenditures to be deemed cost‐​effective, these added measures would have to have deterred, disrupted or protected against more than one otherwise successful car‐​bomb attack, in a crowded area, every single day.

And although it is true that terrorism is a hazard to human life, so are many other things. The terrorism threat should therefore be dealt with in a manner similar to that applied to other hazards (albeit with an appreciation for the fact that terrorism often evokes extraordinary fear and anxiety in addition to the actual physical and economic toll it takes). After all, while allowing emotion to overwhelm objective analysis is common and perhaps understandable, it is not appropriate for officials whose job it is to keep the public safe.

Those who join the Army or become firefighters accept the possibility that at some point, they may be placed in a position in which they are shot at or required to enter a burning building. It is only reasonable, then, that those who become decision‐​makers should acknowledge that in order to carry out their job properly and responsibly, they may be required on occasion to make some difficult, unpopular and even career‐​threatening decisions.

One of the problems among those making these tough decisions has been that when seeking to evaluate the effectiveness of homeland security expenditures, they are too often asking the wrong question, namely, “are we safer?”

Of course, we are “safer.” The posting of a single security guard at one building’s entrance enhances safety, however microscopically. Instead, the correct question to begin with is “how safe are we?” which should in turn lead to the examination of another question, one posed shortly after September 11 by risk analyst Howard Kunreuther: “How much should we be willing to pay for a small reduction in probabilities that are already extremely low?”

Unfortunately, as far as we can tell, Department of Homeland Security decision‐​makers generally do not follow such a risk‐​assessment philosophy, because if they did, surely low‐​cost solutions that are easily deployed and effective would be the first to be implemented.

Instead, a committee of the U.S. National Research Council noted in a 2010 report that, after two years of investigation, it could not find “any DHS risk analysis capabilities and methods” adequate for supporting the decisions made about spending on terrorism and noted that “little effective attention” was paid to “fundamental” issues. This is particularly strange because the committee also notes that the risk models used in the department for natural hazards are “near state of the art.”

Sadly, the report, which essentially suggests that Homeland Security had spent hundreds of billions of dollars without knowing what it was doing, generated no coverage in the media whatever.

So what should we take from all this?

It is particularly important for officials to inform the public honestly and accurately of the risk that terrorism presents, something they have too rarely done. And if they can find ways of doing so effectively, they would be in a far better position to expend public funds in ways that genuinely enhance public safety.

The reality, unfortunately, has been that decision‐​makers have placed far too big an emphasis on exacerbating fears. Perhaps they are afraid that if they continually point out that an American’s chance of being killed by a terrorist at present rates is one in 4 million per year, they will be asked, “Then why are we giving you so much money?”

To be irrational with your own money may be foolhardy, to give into guilty pleasure or to wallow in caprice. But to be irrational with other people’s money, particularly where public safety is concerned, is irresponsible. In the end, it becomes a dereliction of duty that cannot be justified by political pressure, bureaucratic constraints or raw emotion.