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On Knowing the Price of Everything and the Value of Nothing
by Frank Ackerman and Lisa Heinzerling
The New Press, 270 pp., $25.95

reviewed by Osha Gray Davidson

Adoctor, an architect, and an economist were sitting in a bar arguing over who had the most important profession. "Clearly, it's surgery," claimed the doctor. "After all, God created Eve by removing one of Adam's ribs."

PricelessThe architect disagreed, saying that her job was by far the most important. "Way before Adam and Eve, God built the heavens and the earth out of chaos," she insisted.

The economist leaned back in his chair, smiled, and said quietly, "And who do you think created the chaos?"

The joke, of course, is that economists claim to bring order to a chaotic world. But the humor seems more apt than amusing these days, with the Bush administration shredding decades of environmental laws, often justifying its actions with an economic strategy -- cost-benefit analysis -- that seems perfectly reasonable but is in truth fundamentally flawed.

When the Bush administration announced in 2001 that it was appointing economist John Graham to head the little-known Office of Information and Regulatory Affairs, the White House bureaucracy that reviews regulations proposed by the various government agencies, it claimed that Graham would bring order to the way the federal government regulates everything from the amount of mercury a coal-burning power plant can release, to how many trees we should log from our national forests. But instead of order, Graham's obsession with cost-benefit analysis has brought more chaos -- and controversy.

Among the bizarre concepts Graham has championed is the notion that older people are worth less than the young. According to this logic, if Regulation A would save the lives of 50 3-year-olds each year, at a fixed cost, that might be worth doing. But Regulation B, which would save the lives of 50 elderly citizens each year at the same cost, would get scratched. That's because by already having lived many years, the elderly have, in effect, used up much of their value to society.

Graham's championing of this "life expectancy" approach (or "senior death discount," as critics call it) so outraged advocates for the elderly that last May, then-administrator of the Environmental Protection Agency Christie Whitman was forced to assure the public that the agency wasn't basing any of its decisions on Graham's calculation that the lives of people past 70 are worth precisely 37.8 percent less than the lives of everyone else.

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Osha Gray Davidson is the author of five books, including Fire in the Turtle House: The Green Turtle and the Fate of the Oceans. His articles have appeared in Rolling Stone, Mother Jones, and the New York Times.

OnEarth. Spring 2004
Copyright 2004 by the Natural Resources Defense Council