The TSA Is Expensive

The Transportation Security Administration's commercial airline passenger screening system, decried as "security theater" by some, is designed to prevent armed terrorist and criminal incidents on commercial airplanes and in secure parts of airports, and the incidence of both has been vanishingly low, despite evidence that the TSA is not anywhere near 100% effective. 

But, this ultrahigh level of security, as anyone who has travelled by air in the last decade is well aware, is costly, both in terms of direct costs and in terms of material delays that burden the entire air travel system. 

A recent article recaps those costs (and also discusses other absurdities of the TSA system), although all of these estimates should be viewed with some skepticism. While some of the issue is psychological cognitive biases, some of the issue is the difficulty of estimating the costs and benefits of the system.

For example, when estimating the benefit of a future 9-11 attack, one has to consider that such an attack would not only kill people and damage property directly, but would also probably shut down the entire commercial airline network entirely for an extended period of time and could lead to decades of war. If you include the cost of the war in Afghanistan in the cost of a 9-11 attack, the cost effectiveness of the TSA is much improved.

Actuaries measure the cost-effectiveness of an intervention — say, a pharmaceutical drug or a safety device like a seat belt — with a metric called “cost per life saved.” This calculation tries to capture the total societal net resources spent in order to save one year of life. 

For example, mandatory seat belt laws cost $138; railway crossing gates cost $90,000; and inpatient intensive care at a hospital can cost up to $1 million per visit. 

As long as an intervention costs less than $10 million per life saved, government agencies are generally happy to back them.

The most generous independent estimates of the cost-effectiveness of the TSA’s airport security screening put the cost per life saved at around $15 million. And that makes two big assumptions: first, that the agency is both 100 percent effective and 100 percent responsible for stopping all terror attacks; and second, that it stops an attack on the scale of 9/11 about once a decade. Less optimistic assessments place the number at $667 million per life saved.

Via Marginal Revolution.