Tabm+ h Soaity, Vol. 7. FtintedintbcusA.Aurightsd.
pp.25-30(
1985)
0160-791x185 $3.00 + .oo Copyright O 1985 Pupmon Press Ltd
Bias in Risk-Benefit Analysis AZZaB Mazur
ABSTRACT. Rh44enefit aria/y.... has become pop&r in the past decauk LLT a means of improving ahakion-ma&g, especad’y in the area of tecbnologv pocky. Here d-benefit analysti is compared to other (eqdy rkfnde) approaches to akchion-ma&g, sbowang bow it favors some poZitid interests more than otben, andsnggesting why it ba recently come to tbe fore as a tooi ofpoidad anakyti.
People can be conceptualized as utility maximizers. When confronted with a choice among options, a person attempts to select the one that gives him the greatest net satisfaction, or “utility.” Analagously, the best political situation for a group is postulated to be the decision that maximizes the group’s utility. Of course, the postulate of utility maximization is a tautology unless we have some way of operationalizing “utility,” for otherwise it is simply “that which is maximized.” Nonetheless, this is a convenient starting point, for it allows us to compare the risk-benefit approach to decision-making with other, equally defensible methods of maximizing utility. Too often risk analysts regard their particular perspective as superior to others, when, in fact, it simply reflects their own parochial viewpoint. We may ease some of the problems of communications between risk analysts and the public by helping the analysts realize that their approach is limited, arbitrary, and not clearly superior to other approaches, except under restricted scope conditions. Furthermore, the risk analysts should recognize the faddish nature of their concerns, which have emerged very recently in American and European policy discussions (although distant roots can be found), and are primarily aimed at issues of technology, being largely ignored in other policy arenas. Further still, the risk analysts should recognize the political actions that have produced this wave of interest, and they should understand how the risk perspective serves some interests more than others. The Rid-Beneft
Perspective
The d-benefit perspective assumes that each available option has some good features,- which contribute to utility, and some’ bad features, which detract from utility. (Good features might include financial profit, personal happiness, and
A so&lo& and engineer, AAn Mawr ir a profcrsor in tbcManic// S&d of Syracuse Univerdy. With mea& interests dim&d between thbciohgy and the s&gy of techdogy, k bar most nwcnt/ustvdicd the mass me&z coveme of Love Candad Three ibide Iskmd. 25
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environmental beautification; bad features might include financial cost, resource depletion, pollution, and, of course, risk to life and limb .) A crucial assumption is that one can andshould balance the positives against the negatives, comparing the weights of one against the other in order to find that option which gives the greatest net profit of goods over bads. The idea that good features of an option can offset (or be “traded off” against) bad features is central to the risk-benefit perspective, as is the notion that utility can be maximized by maximizing the net profit from these uade-offs. Under certain scope conditions, the risk-benefit perspective is clearly superior to other means of arriving at a decision. Principal among these scope conditions are: (a) that goods and bads are commensurable in the sense that they can be measured by some common metric so that one can be compared against another; (b) that goods and bads s&ouZdbe traded off against one another; and (c) that the person or group can maximize its utility by maximizing the net profit of goods-minus-bads. It is essential for the risk assessor to realize that these scope conditions do not apply to all policy decisions. Furthermore, in the case of controversial policies, or highly emotional ones, one side may be willing to accept these scope conditions, but the other side may not. In such cases, communication across sides is doomed to failure, unless each side respects (or, at least, understands) the scope conditions that each (often implicitly) accepts or rejects. Other Decision-Making Perspectives
In highly emotional cases, especially those involving political controversy or strong ideology, it is unlikely that both sides will accept the scope assumptions that goods sbou/d be traded off against bads. The abortion controversy is an obvious example of this. The pro-abortion (“pro-choice”) side does accept this scope assumption, arguing that the bad features of abortion are offset by the good of allowing women their own choice, of improved family planning, of population limitation, etc. But the anti-abortion (“pro-life”) side argues that tto amount of benefits can offset the heinous sin of murdering an innocent human being; thus they reject the assumption that what is good should be uaded off against what is bad. Sociologist Charles Perrow similarly rejects this scope assumption in asserting of nuclear power and nuclear weapons that there is no way their inevitable risks can be offset by any reasonable benefits. l He speaks for many opponents of nuclear power plants who argue that the risk of a catastrophic radiation release - even though improbable - cannot be justified by the advantages of nuclear-generated electricity, nor even by the higher “routine body count” produced by other methods of generating electricity that do not entail the potential for catastrophe. While many people disagree with Perrow about nuclear power plants, hardly anyone disagrees with him about nuclear weapons. By almost anyone’s calculation, the risk of a nuclear exchange exceeds any conceivable benefit of nuclear arms, and yet the United States and the USSR continue to expand their nuclear weaponry, suggesting that neither country has accepted the scope conditions of risk-benefit analysis in planning its defense. This should not be surprising, for there is a long tradition regarding nationalistic goals as sacrosanct, and considering no sacrifice too
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great in achieving them. When Teddy Roosevelt proclaimed, “Millions for defense, but not one cent for tribute,” he was not speaking from the perspective of a risk assessor. L&e Roosevelt, or the Pope in his denouncement of abortion, or the parent who will pay any price for his child’s safety, or the anti-nuclear activist with extreme fears of a radiation catastrophe, we all identify certain goods as so precious and certain bads as so abominable that we insist they should not be traded for any compensating measures. In this instance, we reject the perspective of risk assessment, that goods should be balanced against bads. To the contrary, we argue from the perspective of ~nv~oZateprritcz$Athat no compromise should be permitted. We will maximize our utility only by standing tall, sticking to our guns, and perhaps going down fighting, but certainly not by compromising our principles, selling out, or giving in to the devil. In such circumstances, the risk analyst will waste his breath arguing that his way is better. The perspective of inviolate principle, which rejects the propriety of trade-offs is not the only alternative to the risk-benefit perspective as a means of maximizing utility. If we reject even the possibility of trade-offs (thus rejecting the scope condition that goods and bads are commensurable), then we arrive at a position that may be called hmmzistperspsctive. This position is so well known that we do not need much discussion of it here. In essence, it says that one cannot appraise qualities as diverse as beauty, human life, and industrial profit in any common currency, and to even attempt such comparisons degrades the human condition. Risk analysts have probably given more attention to this criticism of their position than any other, especially in the many discussions of the dollar value of a human life, without providing a very satisfactory response. They seem particularly vulnerable in their use of expected values to represent risk, equating a known and recurring number of deaths with the probability-times-consequence of an unlikely- but costly -accident. In humane terms, 100 widely scattered deaths per year is simply not the same as a one-in-ten chance of a catastrophic loss of a 1000-person community. The humanist perspective rejects such mathematical juggling as substantively meaningless, asserting that each major policy decision -whether involving trade-offs or not-is unique and must be decided on its own merits with full appreciation of its historical and cultural context. Only then will we recognize which option maximizes our utility. One other perspective deserves mention here, that of poZica/pluraZ~m. In effect, it rejects the scope condition that a society’s maximum utility can (and will) be achieved by maximizing the net profit of goods-minus-bads. The pluralist emphasizes that society is made up of diverse groups, each with its own interests and each defining what is good and what is bad in its own way, which is often inconsistent with the views of the other groups. Society cannot maximize its utility if the groups cannot agree on what is good and what is bad. Thus, the pluralist sees little to be gained from the risk-benefit perspective, except, perhaps, in those rare instances of national consensus. For the pluralist, the preferred method of decision-making is through the usual political process, which no doubt fails to maximize any hypothetical tally of goods-minus-bads, but which does offer opportunities for negotiation and compromise so that each group can bargain to enhance its own well being.
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The difference between the pluralist and the risk-benefit perspectives is most obvious when we consider the problem of equitable distribution of society’s goods and bads among its various groups. The risk perspective is concerned solely with the amounts of goods and bads in the society, taking no account of the way they are distributed across the society. Often one group (say, industrialists) receives most of the goods, while another group (say, workers) suffers from most of the bads. A simple redistribution from a state of unjust inequality to one of more equity would not increase goods-minus-bads (and might even decrease it, considering the costs of redistribution), yet it would certainly raise the utility of the society (at least from the perspective of the pluralist). Some pluralists are so wary of the risk- benefit perspective - with its willingness to balance one group’s risks against another group’s benefits-that they regard it as actually inimical to the utility of a fair-minded society. Why Is “Rid” Now Pop&r? Realizing that the risk-benefit perspective is only one of several approaches to decision-making, and that no one perspective is superior to the others in all cases and to all people, the question naturally arises, Why do we give special attention to the risk perspective over all others? Furthermore, why has this attention grown so rapidly within the past decade, and why is this attention fairly limited to policies involving technology (although it is beginning to appear in other policy arenas)? To answer these questions, it is convenient to use the metaphor of a rock thrown in water, causing concentric ripples to move outward from the point of impact. By moving our eyes inward over the ripples, WCmay infer where the rock hit the water. While risk assessment has distant and diverse intellectual roots, if we follow today’s “ripples” backwards, we find a clear impact point at the end of the 1960sin the mire of the nuclear power controversy.z The “rock” was Chauncey Starr’s seminal article, “Social Benefit vs. Technological Risk,” published in 1969 in Science magazine,3 which frequently carries essays by influential spokesmen for science and industry. Essentially a defense of nuclear power, the article emphasized the small safety risk from nuclear-generated elecuicity. Following a methodologically weak argument, ’ Starr derived a number that he considered the “present socially accepted risk for electric power plants,” and set it equivalent -in some sense that was not completely clear to this author - to a rate of “one catastrophic accident” at a nuclear power plant (which would cause ten lethal cancers and desuoy a major portion of the plant) every three years! He then concluded that the economic concerns of the elecuic power companies, which would not tolerate accidents that often, were more stringent than the present socially accepted risk for electric power plants.’ The impact of the article did not stem solely from its intellectual content. As a past head of Atomics International Division of North American Aviation and Dean of UCLA’s School of Engineering, Starr already had a reputation as an intelligent, articulate and persuasive spokesman for nuclear power. Using his institutional connections, especially the new Electric Power Research Institute, he sponsored and disseminated extensions of his ideas throughout the industry and into regulatory and public concerns over nuclear power. Risk assessment in the nuclear industry received further impetus from the massive Rasmussen Report of 1975, which again
demonstrated that nuclear power plants had much lower risks than society normally accepts from other sources. By 1979, when Inhaber used risk assessment to demonstrate that atomic power was less risky than generating the same amount of energy from the sun6 risk-benefit analysis had become the intellectual currency of the nuclear power industry. Why did the rock of risk assessment make such a big splash in the nuclear industry of the 197Os?The answer is obvious. Faced with the growing nuclear controversy, a defensive industry found that it could use the risk-benefit perspective to make a strong case in its favor. During the 197Os,the cost of oil sky-rocketed, while increasing costs of nuclear energy were not yet apparent. The dangers of dependence on Mideast sources were salient in the public mind, and the incident at Three Mile Island lay in the future. Nuclear power was remarkably safe in routine operation, and it did not pollute the air, nor did it require a trainload of fuel per day per plant. Nuclear power was a good deal, compared to other energy options, ifone accepted the scope assumptions of risk-benefit analysis (and if one was not too bothered by uncertainties in calculating risks and benefits of the various energy options). The industrial and engineering communities, long accustomed to translating complex problems into dollar trade-offs, and never especially concerned with the issue of social equity, did not find these assumptions problematic. Viewed from the risk-benefit perspective, nuclear power looks more favorable than from other perspectives. By assuming that the expected loss of life from an unlikely but catastrophic reactor accident is commensurable with the routine loss of life from, say, coal-generated electricity, the special onus that we usually associate with catastrophes is ignored. By assuming that routine loss of life s,hould be traded off against catastrophic loss of life, we accept as policy the occasional occurrence of unavoidable catastrophes, and we reject the notion that catastrophe-prone technologies are intrinsically less acceptable than those without catastrophic potential. By assuming that one group’s risks can be offset by another group’s benefits, energy options that concenuate risks on one group and benefits on another appear no less acceptable than options that spread risks and benefits more equitably across the society.
The intent here is not to argue against nuclear power, but to show that risk-benefit analysis is an especially favorable perspective for its promoters, whereas other perspectives would favor its detractors. Risk analysts must recognize that their perspective contains imbedded biases. Risk-benefit analysis is friendlier than other perspectives to options that have a small but real possibility of causing a catastrophe, for it counts the catastrophic death of a whole community no differently from the routine background of scattered deaths. It recognizes no goods as so precious and no b‘lds as so despicable that they should not be uaded. Since everything is negotiable, the perspective is more felicitous to those who accept compmmise than to those committed to rigid principles. It is friendly toward options that channel goods or bads toward certain groups, for risk-benefit analysis is concerned only with the amounts of goods and bads in the society, and not with the fairness of their
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distribution. Recognizing these biases, risk analysts should not be surprised when opposing parties, coming from different perspectives, fail to recognize the cogency of their conclusions. References and Notes 1. C. Pettow, Nom& Accirkrmts(New York: Basic Books, 1984), p. 304.
inJ. Cmtad. cd., Scienca, Tscbno/ogymad&d Assetsmat (New York: Academic Pm, 1980). pp. 151-157. C. Stat, S&me 165 (1%9). p. 1232. T. &Molly and A. Mamt, paper presented at the Health Physics Society Midyear Symposium, Richmond, WA, 1970. Stan, op cit. H. Inhabct, ScicnGc 203 (1979), p. 718.
2. A. Mazur
3. 4. 5. 6.