Risks, Costs Weighed in Terror Response

In the era of anthrax and suicide hijackers, how much safety can society afford?

With the nation facing unprecedented terrorist threats, the initial instinct in Washington has been to rush resources and fresh initiatives at every newly identified target, almost regardless of cost.

But as government scrambles to stiffen airport security, tighten surveillance of immigrants, sterilize the torrent of mail the U.S. Postal Service processes every day and fortify dozens of other potential vulnerabilities, some experts are warning that the nation may quickly need to begin a tougher assessment of risk--and determine which defensive measures provide the most benefit for each limited dollar.

“You need some system of prioritization . . . because you can’t defend every conceivable target equally to the same level,” said Bruce Hoffman, director of the Rand Corp.’s Washington office and a terrorism expert.

Though focused mostly on the immediate crisis, Thomas J. Ridge, director of the homeland security office, and other administration officials are quietly starting that kind of analysis, said Dan Bartlett, White House communications director. “Collectively, they will begin to rethink the way that we protect the homeland,” Bartlett said, “and it will be based on an analysis of weighing the potential threat.”

The need to prioritize protection presents the federal government with the perplexing challenge of accurately balancing risk and cost when it comes to a threat as inherently unpredictable as terrorism.

Some of the emergency responses the federal government is now considering were earlier rejected--largely because critics said their benefits would not justify the cost to government or private business. In the last six weeks, though, the terrorists have imposed costs far greater than almost anyone thought possible--rendering the earlier calculations almost instantly irrelevant.

The Sept. 11 hijackings and the anthrax attack through the mails have triggered a cascade of defensive actions in the United States, from government, private companies and individuals. In the process, noted Hoffman, those responsible again have demonstrated terrorism’s capacity to function as a form of economic warfare, forcing wrenching changes in the targeted society through a relatively minor investment of their own funds.

“This is one reason terrorism is so attractive to our adversaries, and why terrorism has been enormously attractive to the powerless over the centuries, because it is from their point of view an enormously attractive strategy of leverage,” he said.

That dynamic has been powerfully evident since Sept. 11. Among other things, the airline hijackings have prompted hurried efforts to improve airline and airport security, rethink local emergency response plans and reevaluate security at such public installations as dams, nuclear power plants and ports.

The anthrax scare has prodded the federal government to move toward stockpiling antibiotics and vaccines in unprecedented quantities, caused private companies to overhaul their systems for receiving mail and even prompted the Postal Service to announce Tuesday it would begin irradiating some portion of the 608 million pieces of mail it processes every day.

So far, there’s been relatively little discussion about the public and private costs of these responses; Health and Human Services Secretary Tommy G. Thompson, stung by charges that the government initially reacted too slowly to the anthrax threat, may have captured the prevailing attitude toward all terrorist threats when he declared this week, “We’re going to act quickly, and if need be, let the science catch up to our actions.”

But as the dangers--and the costs of responding to them--proliferate, questions of priority and cost may become increasingly unavoidable. “Right now, the dominant note is to do whatever it takes,” said James L. Gattuso, vice president for policy at the Competitive Enterprise Institute, a conservative think tank. “But the more people look at the problems, and look at the consequence of overreaction, there is going to be a reconsideration of policies.”

Gattuso said the cover-the-waterfront response to terrorism is unsustainable not only because it will cost too much but also because it will dissipate an even more limited resource than money: the time and energy of federal policymakers. As an example, he argued, it doesn’t make sense for the Federal Aviation Administration to require the airlines to X-ray for explosives all baggage checked onto domestic flights, as many critics are urging. Currently, only a small fraction of such bags are scanned, largely because the airlines have resisted the cost of thorough screening.

“The airlines, the FAA, the security officials can focus on checking every bag and setting up systems to do that, or they can focus on increasing the ability of our screening systems to sort through passengers, or they can focus on improving the training of [security] personnel,” he said. “But all of those things can’t be your top priorities.”

Yet Gattuso’s own example underscores the difficulty of deciding which dimensions of protection are unaffordable. The FAA formally grappled with the costs and benefits of tougher airline baggage security for domestic flights in 1999, when it established new standards for the effort.

In its regulation, the FAA did not mandate universal screening for domestic flights. Nor did it call for an intermediate step that a federal commission proposed in 1997: requiring that each checked bag be matched to a specific passenger on a flight. The FAA explicitly acknowledged that requiring all bags to be matched to passengers “would be more effective in countering the threat.” But under an executive order first issued by President Reagan, federal agencies imposing regulations on business must demonstrate that the benefits justify the cost. And in an economic analysis, the FAA concluded the benefits from required bag matching did not justify the cost to industry--about $6.7 billion over 10 years.

But the calculations the FAA used in measuring the benefits of avoiding an airplane bombing look almost quaint today. The agency economists estimated that the cost of each bombing, including the loss of life, might reach about $200 million; among its assumptions was that an airline bombing would not produce any casualties on the ground.

Although using different means--suicide hijackings--last month’s attacks imposed costs that dwarfed the agency’s estimates from a bombing--some have predicted $30 billion to $50 billion in New York City property damage alone, not to mention thousands of dead. If the regulatory analysis had incorporated that possibility, the more restrictive baggage rules could have passed the cost-benefit test.

Last week, agency Administrator Jane Garvey, facing congressional pressure, said the FAA was now committed to moving toward the most sweeping alternative: establishing a system to require the scanning of all checked bags.

Other issues have inspired similar changes of heart after Sept. 11. In 1996, Congress mandated that the Immigration and Naturalization Service establish better systems to track foreigners in the United States on visitor and student visas. But border community businesses complained that border crossings would be slowed too much if the INS recorded the exit of every visa holder, and universities balked at the cost of the student monitoring system.

“There is no question that the cost of failing to control our borders are much more obvious than they were before Sept. 11,” said Mark Krikorian, executive director of the Center for Immigration Studies, a group that supports reduced levels of immigration.

Those rapid reassessments are a reminder that, even after seemingly objective analysis, determining an acceptable level of risk is still fundamentally a political decision.

“The trouble is that any security measure . . . always involves trade-offs,” said Hoffman, the Rand analyst. “It really comes down to the amount of risk society is willing to bear.”