Honestly, I was expecting to write the complete opposite. I got bored one day after spending a long time stuck in the security line at the airport, and I started thinking that the TSA airport screeners had to be a big waste of money. My rationale is that I’ve seen multiple people get through security with knives in their bags, so it can’t be THAT worthwhile. Supposedly it costs $6 million for every 1 gun the TSA finds. With these kind of stats, there’s no way tight airport security makes sense right? The TSA has an annual budget of $7 billion. Airport security costs customers millions of labor hours worth of wasted time while they are waiting to get through to their flights. All these figures made me think a cost benefit analysis would show the TSA is not worth it. Here are the numbers that led me to a different conclusion.
The Expected Value of Major Terrorist Act Prevention Is Really High
September 11th was one of the costliest man made disasters in the history of our country. First I looked at the actual economic impact, estimated at $120 billion. Then I tried to put a dollar figure on the loss of human life. I use the term “value of a statistical life” (VSL) that the federal government utilizes to do cost benefit analysis on various forms of regulation. The most recent figure for VSL that I could find was $9.1 million. There were 2,977 people lost on 9/11, and using that VSL value brings the economic impact of those lost to about $27 billion. Obviously you can never put a dollar figure on a person, but this is how federal agencies do studies to determine if new safety rules are worthwhile so I’m just using accepted practice. So tallying up the economic impact and cost of human life lost, the total direct impact from the terrorist attacks was $147 billion.
In addition, you have to tack on indirect costs like the wars we have waged in Iraq and Afghanistan. This cost includes the yet to be realized future health care costs for veterans returning home. We also need to include disability payments, additional military wages, equipment, and the lost labor force productivity from men coming back who are struggling with the psychological wounds of war. If you add these costs together, many sources come to a figure around $2 trillion. If you add both the direct and indirect costs together from 9/11, you’re looking at $2.15 trillion.
Cost of the TSA Airport Screeners
Beyond the $7 billion budget, the primary expense associated with the agency is the wait time at the airport. If you assume an average wait time of 20 minutes and an average hourly wage of $20 an hour, the over 600 million enplanements last year would have had a lost wage of about $4 billion. Added into the TSA budget, the total cost is $11 billion. Hence if we think a September 11th type event has a more than a $11 billion / $2.15 trillion = 0.5% chance of happening, the TSA is a great investment. Obviously the TSA has to be the reason the event is avoided for this analysis to work, but I think it’s reasonable to expect that they would catch most serious plots involving heavy weapons, explosives, or large cutting instruments that could be involved in a terrorist incident. They might just miss a few pocket knives here and there.
Especially with the terrible Paris attacks fresh on everyone’s mind, it is clear that there are evil people out there that want to kill us. While it is really important to keep a free society free, a little bit of self sacrifice, however annoying, looks like it is a very good investment. A 9/11 type event only has to happen once in 200 years for the TSA to be worthwhile.
Potential Cost Savings Come from Efficiencies in TSA or allowing Private Contractors
Rather than asking the question “is the TSA worth it,” we should be asking “is there a better way to run the TSA or a better alternative to government run airport security?” If we could cut the wait time in half and rely more on technology to screen people that would save a lot of that $4 billion in lost wages from waiting in line. Imagine how the traveling experience would be improved if everyone could keep their shoes on and their laptops in the bag while they walked through the screening line. With a budget of $7 billion a year, hopefully the TSA is spending a healthy amount of that on technology investment to cut wait times without compromising security.
Another legitimate consideration would be to study if private contractors could be less expensive. For what they do, TSA employees receive a very fair salary with well above average benefits. There are 47,000 TSA workers around the world and their starting salary is somewhere between $25,000 to $39,000, supposedly higher than their private screening agent counterparts. You could either subcontract out the work to a company or figure out a way to reduce head count. If you could invest some money in technology and cut the workforce by 25%-50%, you could start a positive feedback loop of lower wait times and lower costs of running the TSA. The increased fees you could get as more people substituted to air travel for shorter trips could even be a revenue producer for the federal government.
My Takeaway: Don’t Dump the TSA, Make It Better
When I started this back of the napkin cost benefit analysis, I was thinking I’d find the cost of the TSA to be another example of ridiculous government waste that didn’t help keep us safe. After doing the math and finding that a 9/11 type event only has to have a 0.5% chance of occurrence in any given year to make the TSA worth it, I will gladly wait my turn in line and take any frustration with a grain of salt this holiday season. As Paris showed us, we live in a different world today with global terror networks trying to attack us around the clock. Even so, we should still try to figure out ways to make the TSA more efficient and cut down on waiting times to incentivize air travel. Regardless of how you look at the question of airport security, it really does seem like the the TSA airport screeners are a good investment.
Are you suprised that the TSA looks to be worthwhile? Are you not convinced of the probabilities that I’m assuming? Have a good argument for ending the TSA? Comment below!