Distributed September 17, 2001
Copyright ©2001 by Herschel I. Grossman
Op-Ed Editor: Mark Nickel
About 615 Words


Herschel I. Grossman

Why could it happen? Considering the costs and benefits of security

Economists are used to thinking about policy choices as involving a comparison of perceived costs and benefits. Can this perspective help us to understand why we protected ourselves so poorly that suicidal terrorists were easily able to hijack four airplanes in one morning?


Some of our leaders are talking about waging a war to end terrorism and even more naïvely, in the words of President Bush, “to rid the world of evil people” – an echo of Woodrow Wilson’s “war to end wars.” But we cannot escape the fact that our power and wealth stands in the way of the desire of other people for power and wealth. Indeed, with power and wealth being contestable, conflict with envious enemies is inevitable and probably cannot be deterred.

We also cannot escape the fact that ruthless and ambitious men are capable of deeds that are fanatical, fiendishly clever and horrendous. In the past such men have murdered innocent people by the millions, not merely by the thousands. In sum, history teaches us that, in the world as it is, we have no choice but to focus on how to protect ourselves from diabolical acts by both foreign foes and domestic dissidents.

Then, why, before last week, did we protect ourselves so poorly that suicidal terrorists were easily able to hijack four airplanes in one morning? From the accounts of the actions of the hijackers it seems clear that we could have prevented the hijackings, had we had in place intelligence and security measures that are known to be effective.

An easy answer is that effective intelligence and security is expensive, intrusive, and inconvenient and that the perceived threat of hijacking was not great enough to warrant this expense, intrusion, and inconvenience. But, this answer is hardly adequate. In hindsight, it is clear that not paying the price for effective intelligence and security was a big mistake.

Why did we make this mistake? For starters, the people responsible for intelligence and security seem to have underestimated the ability of terrorists to organize an attack of unprecedented strategic complexity. Our experts seem not to have imagined that a terrorist plot could include well educated people, including trained pilots, and that a bunch of terrorists could manage the long-run planning, coordination, secrecy and commitment involved in this attack.

But, this blunder by itself is not sufficient to account for the horrendous consequences. If the risk was only of a few hijackings of the usual type, with the hijackers demanding money or publicity in exchange for the safe release of their hostages, then even with a better estimate of threat of hijacking, it might have been a reasonable gamble to try to get by with the intelligence and security measures that in the event turned out to be inadequate.

The fatal problem seems to have been a second blunder, which was to underestimate grossly the consequences of a failure of intelligence and security. This blunder seems to have resulted from a disastrous disregarding of the possibility that potential hijackers might not be relatively benign seekers of money and publicity, but rather, as it turned out, ruthless murderers whose objective would be carnage and maximum physical and psychological damage, and who would employ a suicidal strategy to achieve this objective. Certainly anybody who attached even a small probability to this possibility would have been willing to pay the price for putting effective intelligence and security measures in place.

As a economist this disaster reminds me that the rational evaluation of perceived costs and benefits can have little value if the consequences of policy choices are misperceived. The other lessons also are old ones. Do not underestimate either the ability or the ruthlessness of potential enemies. Assume that potential enemies are at least as capable as we are of effective planning and efficient execution of complex plans. But, do not assume that potential enemies are like us in being subject to the same humane compunctions that constrain our actions.


Herschel I. Grossman is Merton P. Stoltz Professor in the Social Sciences and professor of economics at Brown University.

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