Anmol on Terrorism

Anmol on Terrorism

In recent times the world has been plagued by terrorism, as there appears to be a bomb blast, or a mad man with a machine gun, every day, somewhere in the world. We still feel the effects of certain terrorist acts, and their repercussions, such as 9/11. Nations spend billions of dollars, even declare war over these acts, which makes you to ask, is it worth it? This article might make me appear like someone who doesn’t value human lives, which isn’t true, I value all human lives, however, I believe that the value of life is consistent, and not determined by cause of death.

9/11 was the single most deadly day due to terrorism, with the death of nearly 3,000 people. Soon after, the US declared war on Afghanistan, which was then run by the Taliban, with no objections, within the US, or internationally. They quickly deposed of the Taliban government, leaving it powerless, and forcing its remnants to hide in the mountainous region between Afghanistan and Pakistan. Unfortunately, all the leader of the movement had escaped, so the Western coalition decided to stay in the country, to try to eradicate the entire Taliban. Right now, 10 years later the American government is still there, although, in their favor, they’ve captured most of the senior leadership of both Al Qaeda and the Taliban.

In the following argument, I’ll assume that the war in Iraq wouldn’t have happened without 9/11, and the sensationalism it creates. The financial costs to the US, due to the wars in Iraq, Afghanistan, and Pakistan have been 3.2-4 trillion dollars. 6,500 US troops have perished, as well. For now, we’ll only look at whether or not the wars were beneficial to the US, and look at whether or not the US could’ve conducted the wars in a better manner. We can analyze the costs to Iraq and Afghanistan later.

Excluding 9/11, the average number of global deaths due to terrorism from 1995-2005 had been about 2 people per day. Including 9/11, about 3 people per day. Let’s assume that with superficial US intervention in both Iraq and Afghanistan i.e., if they withdrew after one year, the number of deaths would’ve been 3 times as much, an extremely liberal estimate. That would’ve been an extra 6 lives per day, for 10 years, or an additional 22,000 lives. That sounds like a lot at a superficial level, but if you subtract NATO troop losses, it amounts to an additional 15,000 lives. So, the value of each life amounts to 3 trillion/15,000, or about $200 million per life. They say you can’t put a value on human life, but various organizations have effectively done so in other ways. There are various other costs, such as the time and resources wasted by TSA searches, and other such utilization of resources, but we can ignore them, because the bias is still obviously prevalent without them.

We also need to include the fact that the above statistic referred to global death, and not deaths in the US. There have been at most 2 possible plots which could’ve developed into another 9/11 in the US, and assuming both succeeded, they would have led to a loss of 6,000 lives, still less than the number of US troops who have perished.

Firstly, diseases like Tuberculosis can be prevented for significantly less. The cost of the vaccination amounts to $200/year/life. Assuming Terrorism leads to a loss of 50 years, on average, the US is paying about $4,000,000/year/life. Yet, a trillion dollars has been spent preventing terrorism, and a significant, but relatively small amount has been spent preventing Tb. This is only one example, but when something is 20,000 times more cost effective than something else, the other thing can generally be disregarded.

An argument for the wars in Iraq and Afghanistan is that they helped the people in those nations. The people were helped by regime change, which would’ve happened regardless of whether or not the US engaged in “nation building”. The two wars have led to, according to some estimates, over a million civilian deaths. Although no one can deny the benefits of losing a tyrant as a leader, beyond a certain point, foreign intervention begins to be harmful to a country.

Other “great thinkers” claim that the US is only in those two countries because of oil. To those who endorse this views, I have two responses. The first one being that the amount the US has spent on military conflicts in the middle east is greater than the total value of oil it has extracted. The second is that China has extracted more oil from the middle East than the US. Enough said.

My arguments about Afghanistan and Iraq were more of a case study, than anything else. My main problem with terrorism is the opportunity cost, i.e. the resources wasted on terrorism that could’ve been spent elsewhere. Due to media coverage, etc. the average person spends more than 100 hours a year worrying about terrorism. If they earned a wage of $20/hour, they could’ve earned $2000 in that time, and saved 10 children, which seems more valuable than panicking about Al-Qaeda. As covered earlier, the money spent on terrorism can be better spent in an infinite number of other ways.

The main reason why terrorism flourishes is because of media sensationalism, more than anything. Media sensationalism leads to other mis-valuations, for example, a statistic which often shocks people is that there are twice as many deaths due to suicides than there are due to murder. Only 3% of all deaths in the 20th century (including wars, famines, etc.) have been due to non-natural causes, as opposed to 15% in the centuries before that. The world is getting less violent, yet we cover violence more. We can balance all violent deaths by increasing human life span by 1.5 years, which can be done by marginal medical improvements, or eating healthy, and taking occasional walks. If the US spent 5% of their defense budget on actual prevention of death, they would save significantly more lives than the rest of the defense budget does. The same can be said for any other country.

Fear of terrorism has been shown to be far more deadly than terrorism itself. The trillions dollars spent preventing terrorism, and rights given up in the name of prevention of terrorism seem to be doing more harm than good. Terrorism only flourishes because of media bias, and because politicians aren’t rewarded for crises prevented, but penalized for crises which occur. Obama won’t get re-elected if he points out that average life span in the US increased by two years in his term. A small reduction in life expectancy isn’t seen as significant, although it's more statistically significant than un-natural death. If you look at it, terrorism's objective is to gain attention, and due to our fear of terrorism, they gain that attention, and hence get political clout. Fear of terrorism leads to terrorism. My message isn’t that terrorism related deaths are unimportant, it’s that non-terrorism deaths are important as well.

Anmol on the value of time

Human beings make many obvious mistakes within their lifetime. Whether it’s marrying the wrong person, or buying airline stock (somebody has to), many of these mistakes are easily preventable, and other people can tell you about them, though we sometimes chose to ignore these people. One mistake that’s often forget about, and that others don’t notice easily, is mis-valuing your time.

There are various ways to attach a value to your time, the first would be to check how much you would earn if you worked in that time. Let’s say you’re paid a wage of $25/hour. If you’re paid a salary, you can find your wage by dividing your salary by number of hours worked. Anyway, you need to see how much you earn per minute, about 42 cents, and how much you earn per second, about 0.7 cents. This is extremely important while making decisions. For example: you drop a penny on the ground, it takes 2 seconds to pick it up. Most people would pick it up regardless of their income, because it’s intuitively right, and therefore backed by instinct. Unfortunately, the value of 2 seconds of your time would be 0.7¢*2, or 1.4¢. Therefore, it’s inefficient to pick up the penny, you lose 0.4¢. That might not sound like a lot, but that can be extrapolated into many other situations.

The above situation is one where people tend to undervalue their time. It probably takes about 5 seconds to pick up the penny, it will be a 5 second delay, due to slowing down, looking for the penny, etc., therefore, you pick up 720 pennies per hour, or value your time at $7.20/hour, less than minimum wage in most countries. There are also situations where people over value their time. A good example would be in New York, where people might take a cab between 2 subway stations, if the next subway train is 8 minutes away. Let’s say that the cab fare is $10, with tip, an underestimate to illustrate my point. Therefore, you value your time at $10/8 minutes, or $75/hour, quite a reasonable wage, and one of someone who gets an MBA from a top university.

This would be a situation where they overvalue their time.

The question which is unanswered by wage, is: how would you value the time of someone who isn’t paid a wage, such as a billionaire’s son, who feels no need to work after inheriting a billion dollar fortune. One method of valuation is to assume that his salary is the interest that he receives on the fortune, at a 5% interest rate, that would be $50 million. Assuming that one works on average 2000 hours a year, this would mean that their wage is $25,000/hour, and that’s how they can value their time. However, doing something else won’t prevent them from earning that $25000/hour, such as picking up a penny, so that method of valuation is flawed.

Although the wage method is a good quick method, especially for those without a large amount of wealth, otherwise (a billionaire who earns $5/hour shouldn’t value his time at $5/hour), if one’s wealth is large relative to salary, we need a better method of valuation. There are other problems with the wage method, for example, it allows for one to commit vices, as they would get paid more per hour, than working, but it doesn’t account for the moral dilemma. I think the way to look at this is that work itself has a negative value, and your wage must be larger than the negative value of working. For example, if you feel that working as a software engineer, makes you unhappy enough to lose $20/hour, your wage must be greater than $20/hour for you to do that job. In your time, you must do what gives you the greatest gain in value per unit time.

Now you may ask, why is wealth important to this process, isn’t it the same process for everyone? Well the truth is that the downside to working is mainly an emotional toll, not a financial one. You feel down after working for 8 hours, although it costs you no money. Therefore, wage is not only a value of productivity, but a value of emotions. Rich people value their emotions more, in monetary terms because they have more money. That’s why they go to $200/hour counseling, which most members of the lower and middle classes can’t afford. They’re also likely to buy $50,000 bottles of wine, because it gives them a very marginally higher emotional satisfaction, which is worth $50,000 to them. It also gives them status, which pleases them emotionally, and adds to the value of the wine bottle. If consuming their first bottle of win gives them $60,000 of satisfaction, and they consume it in 1 hour, then the value gained is $60000-$50000/1 hour, or $10000/hour, more than anything else. This is why rich people buy more expensive things, it’s not just because they’re rich. Of course they won’t continue buying the wine, because of the law of diminishing marginal utility, each subsequent bottle is worth less to them. Also, their status isn’t increased significantly by having 2 bottles of expensive wine, instead of one, and the wine is meant to be a once in a lifetime tasting.

There’s a paradox which rises here. Let’s assume that there’s an academic, who’s retired at the age of 25, with savings of $100,000. Since he’s an intellectual, he appreciates all things intellectual. If he values a $100,000 bottle of wine at $200,000, he should buy it, because that gives him his maximum hourly gain, $100,000/hour. However, this obviously isn’t the best solution, as he’s broke after this. Does this mean that we need a no formula?

No, it doesn’t, because as discussed earlier, the bottle of wine gives one an emotional gain. It’s nearly impossible for someone to have an emotional gain greater than his wealth, as emotional gain is proportional to wealth. Is the bottle of wine worth 1000 hours of counseling, or 2000 dinners at a nice restaurant. I don’t think so. the hypothetical scenario is far too unlikely to affect the model.

In the billionaire who earns $5/hour question, the billionaire shouldn’t do that job, as it definitely doesn’t give him the maximum gain in value. So, the billionaire has already mis-valued his time.

In conclusion, the simple way to value one’s time, for those who are paid a wage, is to see how much they time they lose by performing a certain action, and how much money, or value gain they lose. A more accurate, but harder to implement system, is to see what gives you maximum value gain per unit time, and do that in your time. It’s possible that that will be work, if you’re paid $1000/hour, for a job which costs you $20/hour in emotional terms. Also, with work, there’s an increasing emotional stress with hours worked. Even if you were paid a million dollars an hour, you wouldn’t work for 300 hours straight. Also, as wealth increases, emotional stress increases, in monetary value. So, we can conclude that people should only do what gives them the maximum gain in value.