Overreacting to Terrorism

Gene Healy, at Brainwash, and Will Wilkinson, at The Fly Bottle save me some typing by offering various quotes from John C. Mueller's excellent article in the most recent issue of Regulation magazine: A False Sense of Insecurity [PDF format]. Thanks to Healy and Wilkinson, I can now get by with just saying this: Mueller offers convincing proof that most Americans worry too much about terrorism.

Mueller points out, for instance, that the risk of dying in a traffic accident outweighs the risk of dying in a terrorist attack by a couple of orders of magnitude. People who reacted to the to the World Trade Center attacks of Sept. 11, 2001, by making long drives in lieu of flying thus wildly overreacted. Around 3000 died on that sad, but fortunately still singular day, whereas around 100,000 have died in traffic accidents since. Why don't people put those relative risks into better perspective? As cognitive psychologists have amply documented, humans tend to worry more about unusual and dramatic risks than well-known, ordinary ones. Public panic over the threat of terrorism offers yet another instance of that peculiar sort of irrationality.

Does it follow that politicians have overreacted to the World Trade Center attacks of Sept. 11, 2001? Mueller suggests as much, but I am not so sure. American politicians, because they control military and diplomatic policies, can make credible threats against terrorists. Wise public policy thus might reduce the likelihood of terrorist attacks. The average American citizen, in contrast, can do little more than try to reduce the harm done by terrorist attacks.

Consider an illustration of the point. Suppose that because devastating tornados strike your hometown only rarely, your $500,000 house faces a 1/5,000,000 chance of destruction by high winds each year. Although you could prevent that threat by extraordinary measures, such as building a concrete box around your house, you rationally calculate that you should spend no more than a dime a year on tornado protection ($500,000/5,000,000). Suppose further that your hometown faces a 1/5,000,000 chance each year of being devastated by a nomadic warrior tribe. Unlike tornados, however, nomads respond to incentives. Following one such raid, you might happily pay more than a dime towards your town's Marauding Hoard Smackdown fund. You calculate that the temporary expense of chasing down and punishing the nomads will teach them a hard lesson, convincing them to take your town off their "to sack" list. The risk of further such attacks will thereafter drop, repaying your defense investment with future security.

The political response to terrorism thus partakes more of game theory than of a simple cost/benefit analysis. A dramatically costly political reaction to a terrorist attack calculated to reduce the likelihood of future such attacks—e.g., invading a country that harbors terrorists with the aim of disrupting their operations and capturing or killing their agents—may prove rational even while a dramatically costly personal reaction calculated to reduce the harm from such attacks—e.g., moving to the country and stocking up on canned goods—proves merely that you've succumbed to an irrational fear of dread risks.

That by no means gives politicians a pass. Being human, they are as likely as anyone to overreact to the dread risk of terrorist attacks. Being politicians, moreover, they will readily exploit the risk of terrorism as an excuse to increase their power. And even granting that political reactions to terrorism should meet standards different from those we apply to personal reactions, we may still condemn a particular military or diplomatic anti-terrorist policy as ineffectual or worse.

In particular, my argument goes only toward justifying a temporary and sharp response to terrorism that acts as a long-term disincentive to future such attacks. In contrast, the present War on Terrorism threatens to impose disproportionately large and indefinitely recurring net costs on us, the very people it is supposed to benefit. I thus do not intend to exempt that political program from criticism. I intend only to explain why I think that no cost/benefit analysis of the political response to terrorism should ring with indignant certainty.