I found this quite interesting. The government and businesses assign values to human lives when they make decisions. For example, if I am going to sell lead-tainted cookies imported from overseas and make a $20 million profit but I estimate that what I sell will kill 2 people, what should I do? I would simply try to figure out how much these two deaths are worth. If the difference is positive then I would go ahead and sell my food item. Otherwise, I would lose more money than the profits so I would not do it...
This sounds like a heartless and cruel analysis but it is done regularly in real life.
Last week, Reg•Watch blogged about a recent Associated Press investigation that shows the Environmental Protection Agency has been using new statistics to assign monetary values to the lives potential regulations will save. AP found EPA's most recent value, $6.9 million, is about $1 million lower than it was five years ago.
The figure in question is called a Value of a Statistical Life (VSL), which is a number that attempts to place a dollar figure on individuals by studying market data.
EPA isn't the only agency that uses a VSL. Lots of public health and safety agencies go through the ridiculous process of valuing human life in order to comply with White House requirements on cost-benefit analysis. But agencies don't necessarily use the same VSL. Some agencies even use a different VSL for different rules.
If you're wondering how much different sectors of the federal government think your life is worth, take our journey outlined below. If you scroll down, you can even follow along with our interactive map.
Find out How Much You're Worth. Take our Trip around the Beltway:
Start at the Environmental Protection Agency, just a few blocks down from the White House on Pennsylvania Ave. The Associated Press's investigation showed that EPA is currently using a life value of $6.9 million. However, that number is down from just a few years ago. Clearly, you're not living up to EPA's expectations.
From EPA, take Connecticut Ave. toward Bethesda, MD where you'll find the Consumer Product Safety Commission. In March 2008, CPSC used a life value of $5 million for a proposed regulation. That's a little less than Tiger Woods has earned in the six PGA tournaments he has entered this year. Of course, the big money is in endorsements.
Then, head back into Washington, D.C. for a visit to the Occupational Safety and Health Administration on Constitution Ave. OSHA, the agency in charge of protecting workers from injury and illness, used a life value of about $7.5 million late last year.
But don't get too cocky, friends. A rude awakening lies just around the corner. Drive past the U.S. Capitol building to the Department of Transportation. There, a new Department-wide policy sets the value of life at $5.8 million. After about a two mile trip, you just got discounted to the tune of $1.7 million. Ouch.
After the Department of Transportation, take your suddenly deflated self esteem and head to the Department of Homeland Security. In a 2007 proposal, DHS calculated benefits using two life values. DHS's Customs and Border Patrol writes, "We use two estimates of a Value of a Statistical Life (VSL) to represent an individual's willingness to pay to avoid a fatality onboard an aircraft, based on economic studies of the value individuals place on small changes in risk: $3 million per VSL and $6 million per VSL." It's unclear how DHS attaches one of the two price tags to an individual, or what criteria it uses (Good looks? Hidden talents?).
Pack up the provisions, merge onto the beltway, and travel yonder to Rockville, MD, home of the Food and Drug Administration. Unlike other agencies, FDA likes to present a range for its value of life calculation. For a regulation protecting consumers from mad cow disease, FDA estimated the value of life between $5.7 and $7.1 million. Of course, that was way back in 2004, so inflation has probably increased your value a bit…just like milk and bread!