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Economics Versus the TSA

As I wrote a few months ago, a small handful of simple-but-profound ideas do the heavy lifting in economics. They can be applied to almost everything, airport security included. I’ll leave the moral philosophy of it all to abler minds than mine (here are James Otteson and Michael Munger, for example), but some of the principles of economics have a lot to teach us about airport security.

1. There is no free lunch (or free pat-down). When you do one thing, you give up the opportunity to do another. Even if the TSA has made us safer and saved lives (it hasn’t), these saved lives have come at a cost. For every life saved in a TSA-prevented terrorist attack, more lives are lost on highways as people substitute away from air travel and toward driving. Getting rid of the TSA would mean fewer dead people, on net. That’s a win in my book.

2. People Respond to Incentives. When you change the costs and benefits of something, people change their behavior. By making flying more costly, the TSA encourages more people to drive. Even when we take terrorism into account, flying is far safer than driving. As a result of the TSA’s new “enhanced pat-downs” and nude imaging, people are going to die today, tomorrow, and indeed every day from now on who wouldn’t die if flying were more convenient.

3. The margin matters. There is no such thing as “safe” and “unsafe.” We are always trading off safety against other goals, and in the case of airport security we’re interested in what we have to give up in order to get a little more safety. Given the ineffectiveness of security theater, the opportunities we’re giving up in order to get all this additional security are almost certainly more valuable than the additional security itself. A little more of the TSA security cure is almost certainly worse than a little more of the terrorist disease.

4. Profits tell businesses that they are using resources wisely, while losses tell businesses that they are wasting them. A common refuge of those who oppose the economic way of thinking is to say that there are things that are more important than profits. In the case of airport security, people might claim that security is more important than profit, and others might claim that private businesses have incentives to cut corners. This misunderstands the nature and purpose of profit. Profits and losses tell firms whether they are using resources wisely or unwisely. Without profits and losses, we can’t know whether the resources devoted to airport security are doing any good. Since they are acquired and deployed via coercion, we can be pretty sure that they are being wasted.

5. The long-term and unintended consequences of policies and actions cannot be ignored. The incomparable Thomas Sowell has written that economics is the art of asking “and then what?” In his classic Economics in One Lesson, Henry Hazlitt has argued that the “art of economics” consists of identifying the unseen costs and benefits of different policies and actions. The additional highway deaths that will almost certainly occur as a result of the new TSA procedures are certainly not intended, but that doesn’t mean that they are any less real or that they aren’t the direct consequence of the new screening procedures.

There are other indirect effects, as well. We will never see the new products that aren’t invented or the new life-saving medical techniques that aren’t developed because foreign nationals have such a hard time getting into the country or because people are electing not to attend professional conferences or hold meetings because the cost of flying is too high. We also don’t see the simple joy people forgo when they elect to stay at home rather than visit family during the holiday season because flying is just too much of a hassle. The list is endless, and while these might seem like trivial considerations to some, they are very important to others. Resisting the temptation to restrict others’ voluntary choices is an important element of being part of a free and responsible society.

Are there bigger, more important issues than the TSA? Almost certainly. The economic way of thinking, however, suggests that eliminating the TSA would actually make us safer. If we’re going to start getting rid of counterproductive, resource-wasting government endeavors, the TSA is a pretty good place to start.

William Arthur ("Art") Carden is a Research Fellow at the Independent Institute in Oakland, California, and Assistant Professor of Economics at Samford University.

  • MyGovCost.org
  • FDAReview.org
  • OnPower.org
  • elindependent.org