America’s Foreign Policy Isn’t Economically Defensible

Forget realism, isolationism, or neoconservatism. The way to look at U.S. decision-making abroad is through the lens of constrained optimization.

Palestinian Government Gives Emergency Payments To Thousands Of Desperate Civil Servants
GAZA, GAZA STRIP - JUNE 19: A Palestinian government employee holds cash that he received as part of his salary, at a post office, June 19, 2006 in Gaza City, Gaza Strip. Days after delivering suitcases full of cash into the Gaza Strip, the Palestinian government today distributed $300 emergency payments to thousands of desperate civil servants who haven't been paid in nearly four months. However, in a sign of the government's continuing troubles, the money was distributed through special postal accounts after local banks, fearful of violating international anti-terror laws, refused to handle the cash. (Photo By Abid Katib/Getty Images)

What would happen if a dyed-in-the-wool economist ran American foreign policy? It’s hard to imagine that even a dismal scientist could make the current international outlook any more dismal. But if a coldhearted bean counter steeped in numbers really did have the reins of power, I’d bet he or she would make some very different choices from those of the current administration.

The name of the game in economic decision-making is, quite literally, “constrained optimization.” Economists try to make the best possible choices using all the information available, given their preferences and subject to the restrictions of their resources. In simpler terms, they do a sort of holistic cost-benefit analysis.

In Washington, the first step would be to choose the objectives of foreign policy. To me, the primary objective is well-being. There are many ways to define well-being — health, happiness, satisfaction — and people don’t all have the same preferences. For simplicity’s sake, let’s say well-being is proportional to life expectancy.

For an economist sitting in the White House, the ultimate objective might be the long-term welfare of all living and future Americans, with no preference between the two. Already, this would be a departure for Washington, where every politician knows that future Americans can’t vote in this year’s election. But I see no reason to give some Americans more weight than others just because of when they’ll be able to vote.

Should anyone else be included in our quest for well-being? From time to time, Americans decide that they care about other people, too. Not Rwandans, it seems, or most Iraqis and Syrians, but probably Europeans and perhaps a few other lucky folks as well. Americans don’t necessarily care about these people’s well-being as much as their own, but they’re willing to spend some blood and money on them once in a while. They do this because it helps their own well-being; once in a while, it makes them feel good to save other people’s lives.

Now the question becomes how to maximize the well-being of all these people. I’ll start with a basic answer: stop them from getting killed. The chance of Americans and Europeans getting killed is actually pretty small most of the time, so in that sense this is an easy job. But it’s difficult to stop any specific person from getting killed, or indeed to lower the average number of people killed each year.

Current foreign policy suggests that the United States needs to spend billions of dollars to keep a relatively small number of American people from getting killed. The wars in Iraq and Afghanistan — forget about all the money spent on intelligence, public security, and costs to private businesses — have cost more than $100 billion a year. What’s the worst that could have happened in the absence of these wars? Even if an attack on the scale of 9/11 had happened every year since 2001, the cost of saving each life would still have been at least $30 million.

That amount is far in excess of the $1.8 million, on average, that the families of 9/11 victims received in compensation for their lost loved ones. And the dollar figure doesn’t cover the cost in blood of the roughly 500 American soldiers who have died, on average, each year, and the many more who have been injured and permanently disabled. Nor does it account for the hundreds of thousands of other people who died as a result of American-led wars — but of course, they’re not part of our calculations.

I can think of plenty of other ways to spend $30 million that could have saved more than one American life — road safety, community health care, pollution reduction, etc. Even doing nothing on the policy front and just using the money to pay off debt might have been better for Americans. After all, the massive military efforts of the past 14 years may have kept a few thousand living Americans safe, but they probably made the world much less safe for millions of future Americans. The United States now has many more enemies than it did before 9/11, if only judging by the global proliferation of extremist groups that target American citizens and other foreigners Americans care about.

A rational response to this conclusion would be to disentangle the United States from conflicts around the world, especially those that are fundamentally tribal or religious. After all, American power has rarely succeeded in stopping people who have wanted to kill each other for centuries from doing so; rather, it has an unfortunate tendency of making those people want to kill Americans instead. In fact, the most successful recipe for containing this bloodlust has been the local application of authoritarianism, as practiced by Muammar al-Qaddafi and Saddam Hussein. The United States eventually worked to overthrow both of them, perhaps against its own interests. When they left the stage — ruthlessly oppressive as they were — gory chaos followed.

President Barack Obama started off in this rational direction, attempting to end the wars in Afghanistan and Iraq and to close the globally notorious prison at Guantánamo Bay. But his resolve crumbled as vested interests both in Washington and abroad persuaded him that Americans at home might be less safe unless troops stayed on the ground abroad. This notion might have been correct for living Americans in the short term, but it may also have been very wrong for future Americans. Rather than rehabilitating the international reputation of the United States, Obama’s failure to make a clean break has added hypocrisy and unkept promises to an angry world’s list of grievances.

The current situation in the Middle East and North Africa is another quagmire to which an economist might seek a rapid exit. The United States is involved in a proxy war between regional powers and religious sects, not for the first time, and it’s not making any friends. Not even the objectives are clear, let alone the effects on living and future Americans. In the meantime, billions of dollars have left the Treasury. Just about the only policy that promises clear benefits for living and future Americans is the fledgling nuclear deal with Iran, whose cost has been orders of magnitude less than a war.

Overall, however, this foreign policy isn’t economically defensible, unless it somehow helps living and future Americans in ways that aren’t perceptible to members of the public. Yet there’s no parade of experts coming out to defend the administration’s strategy and explain its advantages to the American people. At least, there’s no parade of economists.

Abid Katib/Getty Images

 Twitter: @altmandaniel

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