Replace 'lives saved'

Cost-benefit analyses required to justify government regulatory action can be improved significantly if the "lives saved" standard was replaced by a "life-years" metric, according to a new study on cost-benefit issued by the Mercatus Center of George Mason University as part of its Regulatory Studies Program. "The change should make the practice of benefit-cost analysis more transparent to the general public," the study asserted. It went on to explain:

"Most people can understand longevity as a suitable measure of health benefit ... Using life-years will also make it easier for the public to understand how discount rates apply to health and safety programs. With life-years as the measure of benefits, there is no need to discount. Instead, the costs of the program can simply be amortized over the life-years saved ... The result is mathematically identical to discounting."

The study presented some two-dozen examples where cost-benefit calculations could be improved. None dealt with aviation, but one case-study dealt with a proposal by the Department of Transportation (DOT) to limit the allowed hours per day truck drivers could be on the road, and which would require electronic on-board recording devices to monitor compliance. The case parallels efforts by the Federal Aviation Administration (FAA) to enforce a 16-hour duty day for airline pilots (see ASW, June 10). Indeed, the Mercatus Center report illustrates the kind of resistance the National Transportation Safety Board (NTSB) faces. Modernized and rationalized duty regulations for all modes of transportation are on its "Most Wanted List" of safety improvements (see ASW, May 20).

The Mercatus Center report dismissed outright DOT's proposal to prevent fatigue-related crashes among truck drivers:

"DOT does not present data to support its assertion that fatigue systematically contributes to highway fatalities ... The focus of this rule on reducing driver fatigue is not based on reliable evidence that fatigue is a significant contributor to fatal accidents. Perhaps road congestion, road quality, or other vehicle, driver or infrastructure considerations are more important ... The proposed work hour caps cannot effectively mandate reductions in sleep debt, and DOT's proposal to eliminate alternatives and flexibility in a system with as large and diverse a work force as trucking will not address the sleep deficit problem, if one exists.

"DOT's fatality-reduction benefits are overstated and [are] sensitive to key assumptions. Its cost estimates ignore important costs, such as the cost of new trucks."

Similar arguments have pervaded the debate concerning flight time/duty time regulations for pilots. >> The Mercatus Center study may be viewed at http://www.mercatus.org/research/RSP200202.htm <<