Economists aren't the best people to have around when others are delightedly praising the benefits of this or that public policy. We have the nasty habit of bringing up the unpleasant topic of costs. Let's look at how unpleasant economists can be.
Do-gooders like Ralph Nader want Congress to pass legislation mandating that the Federal Aviation Administration require infants to travel in separate child-restraint seats instead of on the laps of the parents. The estimated 10-year cost to parents is $1 billion in higher travel expenses.The Nader crowd chimes that if just one life is saved, it's worth it. That's the benefit side: In the remote possibility of a crash, a few infants' lives may be saved. However, it's impossible to have a benefit without a cost. Having to pay extra fare will force roughly 20 percent of families traveling with infants to drive rather than fly.
Since highway travel is far more hazardous than air travel, the child-restraint provision would lead to an estimated net increase of 82 infant and adult fatalities over a 10-year period. While there's a benefit to the aircraft child-restraint provision, there's a cost that exceeds the benefit.
Speaking of airline safety, we might even ask how much FAA policing is necessary in the first place. Here's my reasoning, with a question to you: Suppose you went out and bought a McDonnell-Douglas 11 for $115 million or a Boeing 777 for $140 million. Would you be indifferent as to whether that plane landed safely or not? I suspect you'd pay a lot of attention to safety, even if you didn't give a hoot about passengers.
Some people might say, "Williams, you can't be too safe!" I say, yes you can. When NASA launches Discovery, there's an extensive pre-flight systems check. There are ships, planes and other rescue equipment on station in the event of a crash.
Do you think there should be similar safety procedures for each passenger flight that takes off? Not me - that amount of safety is not worth it. What about automobile travel? Who bothers to do safety checks like inspecting brake cables, the emergency brake cable and fuel fittings each time they drive?
The benefit would be that of reducing the chances of an accident due to mechanical failure. However, the cost would be the time lost that could be put to higher-valued uses. Weighing value of the expected benefits against the value of the costs, most people simply turn the ignition key and go.
Any economist will tell you that if we only looked at benefits, we'd do darn near anything - because there are always benefits.
In the early '80s, I attended an awards banquet in New York City. Sen. Robert Byrd was one of the speakers, and he chose to criticize the Reagan administration for wanting to raise the speed limit to 70 mph despite the argument that "55 saved lives." During the question period, I asked the senator whether he'd go along with making the speed limit 5 mph. In that case, there'd be no highway fatalities.
Byrd's reply to me was that my suggestion was ridiculous and impractical - to which I responded that what he really meant was the additional lives saved by a 5 mph limit were just not worth all the travel delay and inconvenience.
The economist's bottom-line message is that for human compassion and efficiency, benefits should at least equal costs.
Creators Syndicate Inc.