The single most important public policy decision The People must make is to establish the Value Of Life (VOL), or more specifically the value of a quality year of human life. A great many things depend on this number, including health-care policies, safety and environmental regulations, compensation due for death or disability, speed limits and other traffic laws, and even the size and type of military a country will maintain. Unfortunately in most governments elected officials fear to enter this domain, preferring instead to turn the job over to amateur-social-engineer bureaucrats. The result is inconsistent policy where each department of the government uses a different number and the range of values is huge. This makes it impossible to develop a coherent policy and leads to consistently adversarial relationship between The People, the government, and corporations that must comply with these policies. In many cases, notably in the areas of the military and national security, no number has even been defined and so budgeting is determined without any cost/benefit analysis at all.
The US and international medical standard for the value of a human life is around $50,000 USD per year. With an 80 year life span, this works out to about 4 million dollars for the value of a young child’s life. Median age in the US is about 37, however, which results in a value of just over 2 million dollars for the median US citizen. Most regulatory policies in the US, however, use a number about four times that when evaluating the cost/benefit ratio of regulation. Why?
Some other questions that must be answered as part of the process of setting this number:
- Should it vary depending on age? An infant is not only significantly more likely to die due to illness or accident than an adult, but will be a financial burden on society until credentialed. Should this risk and cost be factored into the equation?
- What about the retired: Does the fact that they are no longer contributing to GDP have any impact on the value of a year of their lives?
- In most countries, a year on kidney dialysis is generally accounted as half a year of quality life. But what about other chronic illnesses or disabilities: Does their impact on quality affect the value of a quality year of life?
- Should the value depend on the domain? Should the same number be used when considering the value of a hip replacement as when deciding on speed limits for cars? Should the possibility of being killed by contaminated food be placed on an equal footing with the risk of being killed by a terrorist or in a war?
- Should the value depend on the Locality? Whether the life in question is a Matchist?
Increasing the VOL generally means increasing the cost of living or decreasing the standard of living. Higher value means more expensive medical care, more expensive products (safer and less harmful to the environment), more regulation (and more government overhead), lower speed limits, more expensive military equipment to reduce casualties and ensure success in any military operation, and decreased freedom for anything that might put other lives at risk (smoking, owning weapons, etc.) Lower values have the opposite effects, but come with and increased risk that you or your friends or your family might fall victim to one of these things.
Here are some examples of how the VOL would be applied. In many cases this is already done, albeit with values that have not been approved by The People or indeed are not even known to them. There is therefore no point in arguing whether we can vote on something like this under any naïve justification of the form “You can’t put a price on human life”: These decisions are made with or without our participation, we might as well make the values match us:
- The speed limit: Time saved by increasing the speed limit vs. increased risk of death or disability.
- Road improvements: Cost vs. reduction in accidents
- Product safety: Determine when a product is so dangerous it must be recalled, would also provide a standard value for compensation if a product injures or kills someone, but is not so dangerous it must be recalled (subject to comparative negligence).
- As a standard for medical treatment (it is already used extensively for this by both private and public insurance).
- Environmental and food safety standards (heavy metals, pesticides, hazardous waste exposure, etc.)
Next: Tax Rates