terrorism actually presents? another quick thing about what the book presents we have it for sale and is priced to sell here at the cato institute. $18 with a spine hardcover book. you are, quite certain you will not find it for lesson on top of that the office assured me they would be happy to sign it for you so those of you who are here with us today are very fortunate. those of you who are watching on line at home i'll bet you wish you were here but rest assured you will be able to find a book and other fine retail establishments on line etc., etc., etc.. let me welcome john and mark. i'm going to deduce them in the order they will speak. john mueller is a senior research scientist and a member of the political science department at ohio state university and is also my colleague and senior fellow at cato. he is the author of numerous books. i will mention only a few including overblown, atomic of session, war of ideas coming retreat from doomsday the obsolescence of war, war presidents of public opinion, the remnants of war and with mark stewart, terror, security and money please member the american academy of arts and sciences and has been a john simon guggenheim fellow. mark stewart is a professor of civil engineering at the director of the center for performance and reliability at the university of newcastle in australia and also in australian professorial fellow. he again co-authored with john the book terror security money and is written more than 300 technical papers and reports in his career. his current work focuses on the quantification of security risks and the cost-effectiveness of aviation security other counterterrorism measures. he also leads a consortium of five universities in australia for the commonwealth, scientific and industrial research organization's flagship cluster fund project, climate adaptation engineering for extreme events events. without limit turn it over to my colleague john mueller. thank you. >> thanks very much for coming out. it's not totally common for political scientist to co-opt their books with engineers and you might interested in how that happened. when my first book on terrorism came out call overblown in 2006 i managed to get on "the jon stewart show" and they wanted me on halloween because we were going to talk about fear and so forth. mark stewart with his wife were visiting. they were both engineers and mark e-mailed me saying we ought to get together. we got together over a cup of coffee. he started talking about breaking even analysis which he will talk about now and i will bet which is basically terrorism and the only way to deal with it in an efficient way is not simply to say, trying to figure out the what the probability of a terrorist attack but rather how many terrorist attacks on the security measure passed to prevent in order to justify its expense hence the cost benefit analysis sort of thing. at any rate we embarked on a career writing a whole bunch of stuff and published about 20 peer-reviewed articles in the area and dozens of offense. we got one into "playboy." we were not on the centerfold and markets. proud of that area he tells all of his engineering publication so it's been a very productive occasion. in 2011 with published the first book together which is terror, security and money in which we analyzed the standard cost benefit analyses, mostly protection of infrastructure including for example the office buildings protecting office buildings from terrorist attacks doesn't make a whole lot of sense unless the likelihood of an attack against it over and is a thousand times higher than it is at present rate and the current book is focused on policing of terrorism and between the two they take up about 90% of expenditures on homeland security, domestic homeland security within the united united states. let me talk a little bit about that and set it in context. as chris pointed out there has been a prodigious increase on spending on policing since 9/11. the fbi's budget counterterrorism budget went from something like 11 billion to 3 billion is continuing. there was an effort overall to try to find terrorists and after 9/11 the thought was they must be everywhere and they must be extremely sophisticated so as early as 2002 the intelligence people were telling reporters that they believed there were between two and 5000 al qaeda operatives operating within the united states. after longer period of time we look back at that and indicates probably the total number was probably closer to three or seven. in other words they were seeing an awful lot of those. also very impressive has been the fact that under the direction of robert mueller the director of the fbi at that time the order went out basically to follow every tip, every lead that comes in and they established a thing called the threat matrix which is simply a table of tips that have come in. our calculations are, i touch on in the book actually be fbi has followed up over 10 million leads since 9/11 which at most a thousand have been very productive and even lead to real terrorism, the ones that are basically pretty trivial. peter burgin has come out with a book recently who says basically they are not just chasing 5000 a day but chasing 10,000 threats a day so that means is that numbers corrected actually chase down something like 20 million leads up which only 1000 lead to much of anything at all, probably less than a thousand. it's a prodigious amount of effort in the question is is it worth it overall? is the idea of going after every single tip and every lead very effective? and what we tried to do in this book is sort of assess how bad the terrorism threat is and how significant is it to the united states and how many terrorists are there and what is the likelihood they could create mayhem? is mark will point out later break even analysis suggests that for the fbi's expenditures on counterterrorism to be justified they would have to disrupt, foil, deter about one quite large attack like in times square every two months so the question is if that's the case is that reasonable to expect they might dunn? may be because of the fbi endeavor government agencies we are in better shape on that. what i would like to do is go through what terrorism has been in the united states. it's obviously been asked ordinarily limited in the sense of the amount of disrupt -- destruction that has taken place. since 9/11 about three people per year have died at the hands of islamist terrorists. that's extremely small number and the people who have died by lightning is 10 times higher that -- higher than that. the fbi and other policing agencies have been able to handle it. let me look at various levels here. first of all there is disclosed terrorist of the of terrorists who have actually been caught in various kinds of plots over this period. i've done a casebook which is a vendor pages. it's a web book on line with a case study done by owner students at ohio state and it's really quite good i have to say. each of these cases of 60 or 70 individual cases which have come to light either the terrorist has perpetrated them or they have been disrupted and brought to court during this period of time. when you look overall at these cases, they are really pretty unimpressive. there are a few that might have led to something but for the most part what happens is the fbi gets wind of the plot that has put into force and has been able to disrupted mostly by inserting an informant into the plot itself and the informant is not just looking but actually pretends to be a fellow terrorists. for example a guy in baltimore a few years ago decided he wanted to be a jihadists. they started advertising on facebook for fellow jihadists. this is not at all unusual and he got three responses. the first response told him stuff it. the second response was trying to argue out of it and a third was was from an fbi operative who said wow i've always wanted to do terrorism myself. need some help. it does happen to have this car bomb in my garage and i need help setting it off. so they got together and so forth and eventually the guy was arrested. that's really very typical and what you get in this is it's not so much they are working on innocence but working on people who are predisposed to do something. they are really angry about stuff but they seem to be amazingly incompetent overall. so consequently the idea that they could get together on a coherent plot when you look into these cases is very questionable. some cases the guy in baltimore probably wouldn't have gotten around to doing much of anything and if he did something he would most likely be killed himself. if you look at these cases there are some that are pretty scary, pretty threatening at least and maybe they would have gotten their act together which is pretty questionable. you certainly wouldn't have one every two months by any means he the next case would be the so-called undisclosed cases and you contemplate get the notion that we can't tell you about everything, every plot we have disrupted. there've been a whole bunch of them, big ones that we disrupted that they didn't get to court and we disrupted them in a different way and we can't talk about it. i tried to trace back down in various ways and let me just give you unquote here, actually two quotes. one is from mark who has been in the middle of this for several years. he wrote important books about terrorism. he said is a member of the intelligence community he was kept abreast of all the plots united states and had not seen any significant terrorist plots that have been disrupted and not disclosed. on the contrary the government goes out of its way to take credit for non-plots such as their sting operations. i also checked with glenn carl who is a national intelligence officer for transnational threats at the cia for many years. i asked him about the reports, the undisclosed report and since we are on c-span we have to be careful here but his response was three words, six words, two words are pitted, three times. the first one begins with b and the other one begins with axe. so it is seems that that's very unlikely. the next step is how about people who have been disrupted referred to as the al capone kind of thing. in other words there are people i've talked the talk. the fbi has found out about it but they haven't gotten into a conspiracy. they haven't moved towards doing something but the talk is dangerous sounding. and you can't get them for simply saying jihadist type stuff. what has happened and probably 100, 200 or maybe more cases as these people i've been disrupted by resting them and predicting them on different charges. i was just at a performance last night of 1984 and there is the phrase about the thought crimes. this comes pretty close because they have spoken of course about possibly committing a crime but that's all they have done. and then they get prosecuted because of that. their whole record is looked at to see if there's something they can be put in jail for. in other words if you look at these guys, in some respects that triggered this look at the immigrants it's almost impossible to enter this country without lying in some respects on misidentifying something on your papers. if you are an american citizen these guys frequently have done things which can be jenna milly putting in jail for, running drugs or forgery of something like that. there are a bunch of these plots but the question is the these plots are even more embryonic than the disclosed plots. if they had been less embryonic they would if tried on direct terrorism charges and they basically haven't been. so it's hard to see a whole lot of these would have ever gone without the fbi and other policing agencies going to the fullbore thing. the next case would be about the turning attacks. surely the intelligence apparatus and for that matter the whole security apparatus has deterred terrorists from attacking in the united states because it would be very difficult. i'm inclined to agree that would be very much the case, very much the case that there are certain targets which are definitely very much unlikely to be attacked. for example trying to hijack an airliner is incredibly difficult i've done a lot of studies on that. the successes are well under 1% with all the security barriers there including policing ones and another place, another popular target that is off-limits are military bases. many of the targets, many of the terrorists want to attack military bases because unlike much what you hear about radicalization and so forth as farce these cases are concerned the chief thing that causes them to radicalize is hostility to american policy. it's not hostility to democracy. it's not to create caliphates or sharia law. to give you an example you may remember the boston marathon bomber who was hit on the boats and play with their bleeding he wrote out a certain manifesto. this is totally typical with this furby is coming out of a would-be terrorists. our actions came with a message he said radio's government is killing our innocent civilians it did as a muslim i can't stand to see such evil go unpunished. you heard one of us and you heard us all. we are beginning to rise up. basically hostility to american foreign policy in the middle east both military and political so therefore an attack on i military base would be terrific so -- and very hard to do so they focus on easy targets which are basically recruiting stations and so forth. the problem with this if you are dedicated jihadist and you can't bring down an airliner and you say okay i'm not going to do anything there is not tell you and other possible targets. the jihadist says i want to take down an airliner, i can't take down an airliner so not going to be a jihadist as opposed on number of targets they could attack with alms or bullets for instance in san bernardino. they are deflated by the fact that they can get their gold standard terrorist targets but continued to keep doing this is very questionable. the idea that deterrence is very effective. finally there's the notion that well we haven't found, these terrorists, we have only caught the stupid terrorists and the smart ones are still out there. well if that's the case why don't they do something? the longer they wait the more likely they are going to be attacked and be found out raid the idea that only the ones have been caught in the smart ones are still out there if they are smart they would be trying to do something and they simply haven't done it. the overall effect is basically the amount of threat disclosed and undisclosed is really quite limited areas i only have a minute or two left and what i would like to do is just a quick thing out of the book about public opinion on terrorism and come back and explain later. we have done quite a bit of looking at the trends and public opinion lebanon there are mostly , they are just about all flat since the end of 2001. if is it likely and may or may not be killed by a terrorist? to think the united states is winning the war on terrorism and so forth? they bounce around with events but basically there are flat all the way through which is really impressive because you think there would be some erosion over this period of time basically as far as i can see there hasn't then. this is before i says added on. you have a long period of time with no big attacks to speak of. osama bin laden has been captured and still there haven't been any erosion's. the conclusion on this, there are various things on it but the final one is essentially one of the problems is this kind of terrorism, not all terrorism, this kind of terrorism has a spooky foreign reference namely islam and the middle east. there is no center to it and somewhat similar to fears about domestic connison who have an ideology of some sort or more associated with international, spooky international movement. even though very little happened but economists concerned about them and their danger to national security was very high. the other comparison and did not basically decline either the other comparison is the witchhunts an era. the alternate spookiness of course is th devil. at one time they became, many people said which is existed among us which were doing all kinds of diabolical things. over period of time tens of thousands of which is, mostly women, were executed in europe. eventually that did fade away but it took 200 years so that's a really lemmy conclusion for my talk right now. okay, thanks for your attention. [applause] >> i wish to thank chris and caroline for inviting us today. as chris mentioned i'm an engineer so i'm very comfortable and if we are going to talk about risk we need to speak about how do we kant if i and compare that to others and that's a congressional basis for decision-making. as an engineer i like equations and john doesn't like equations at all so we compromised. so the book has one equation i'm working on john to get to cope. two. how do we measure security outcomes and how do we measure the benefits? there's a lot of information about how much screening measures cost and what we don't see is how much, how money lives had they stayed? it's worth spending a large amount of money if you believe it works so the modeling system of counterterrorism is away to find evidence. all smiley face it's really about how do the cost compared to the benefits, what are the trade-offs that we are prepared to accept? 15 years after 9/11 maybe it's time to recalibrate in our response to those events and what we are doing now. so the key issue that comes up time and time again is risk-averse. the budget and spending up of land and the uk's clearly say any new regulations must satisfy cost-benefit considerations -- cost benefits and if you do that you must use expected values which really means me and i'll use. not using worst-case or pessimistic values. individuals can be risk-averse. an asteroid you can do that. that's a luxury i have. governments do not have that luxury. there have been large amounts of basically your money and buy money and so they tend to be risk neutral which means you look at average risk so that means the risk of debts or damage due to cyclones or maybe floods than i can compare that to the risk of terrorism or different times of medical procedures and comparing apples with apples. so therefore we need to use main estimates in our calculations. when we start to see, numbers tried to show the measures are cost-effective than still not cost-effective so we are trying to be generous as best we can. the final question is what are the risks and we speak at a lot of security conferences. what is risk management or how can we do it better? we are the only ones who have shown this light. the annual risk of terrorism in the u.s. in 45 years since 1970 is one in 4 million to a year. and australia, that was in our backyard essentially or smaller. it's about one in 6 million. these are very big numbers and that's a good thing. in terms of aviation one chance in 90 million that i airline passenger will be killed by terrorists. you can think of this another way. you would have to fly every day for 68,000 years before you are involved in a terrorist attack. so again that's a low likelihood no matter how you look at it. if you look at post-9/11 the risk to the u.s., the total risk is less than one and 99 per year and australia is one and 5 million. these are large numbers. we are the only ones to talk about these numbers and even present them. most of the people say why are you worried about risks, threats and so on that we would argue these numbers are a basis for discussion. is not the total answer but it's the first pointed discussion about are these risk susceptible , why are they so low , are they low because the existing counterterrorism measures are effective and in my view that's probably true. or i've a low because the threat is quite low and we would say that's true as well so trying to figure out, then you can look into the dialect of a lot more detail. they start to give you some insights and yet no one seems to want to know about these things. it's really perplexing. is the risk acceptable that flying is 20 times more dangerous than a terror attack? australian's are a bit more loose with our language. i'm trying to say it's 10 times the risk so is a threat to human life terrorism in the west is the level that we would see as unacceptable. it's you might not like it but it's something in society we can tolerate. it's a bit different because a fatality doesn't have the same socioeconomic impact as terrorism so it's hard to compare apples and apples to someone who dies of cancer with someone is killed in a terrorist attack. this really comes into the next step just to get a bit of a feel for this. cost benefit analysis is simple simple -- the cost is the cost of the secret he measure and this is where we come to one equation. the benefit of the security measures is a lot of feet -- should be successful if an attack was to be successful and the risk how many deaths do we expect her year or what dollars in damages could we expect puryear? a the prayer going to spend money you would expect risk might be 1% or maybe 5%. so the basis to compare one against the other. this equation can be expanded much more detail and fundamentally there are three main premises you need to be asking yourself. let's look at the fbi and move onto fairly simple almost identical example. the observation can be very revealing. the fbi is the highest birdie. we can see how the budgets have gone up by 600 million before 9/11 to $3 billion this is just the budget. the question would be why is it five? may be double the budget would have been sufficient or maybe triple the budget would have been sufficient. risk reduction. the fbi has been successful and plots foiled post-9/11. there are very effective before 9/11 and very professional well organized organization. there has been a lot of tipoffs in public as well which is help. let's assume nine out of 10 plots have been deterred or disrupted by the fbi. the risk reduction is very high, 90%. you could be a bit high order bit low but let's say it's 90%. there are some co-benefits in terms of other than just upping an attack. prompt identification in a terrorist like with the boston marathon bombing for four or five days these bombers were on the loose with risk-averse behavior. the boston cbd was shut down. obviously washington at the time and i met people who were afraid to meet a terrorist in washington they were careful where they went. the longer the terrace were out there never being caught the more possibility there would be future attacks. if the fbi can get these guys quickly that minimizes the losses. the process of terrace they might find other types of crimes like immigration violations and so on so that helps. the other side of the equation, we have two cost per the fbi in terms of counterterrorism maybe they are not providing the resources that they use to provide on organized crime so that could be an opportunity cost. less contributions and other colonel activities. we haven't heard to quantify these the recognize that they can be co-benefits and opportunity costs. so we do a breakeven analysis and what i'm trying to say is how -- to show the benefit exceeds the cost? so we have our equations before between $105 trillion. risk reduction is 90% and now the cost is $3 billion so the only answers how does that publicly have to be for the benefit to the picasso it's a fairly equation. that gives us a table of breakeven probabilities. they are on the last -- left-hand side the losses from different types of attacks. the boston bombing in the losses sustained was about five and a mayan dollars. $95 million for the london bombings, 200 and two joints of dollars for -- attacks. you can think what you think the most likely type of attack would be and how effective the fbi would be. we think the typical thread would be something like the boston bombing. they believe the risk reduction is not -- and as john said break even analysis shows it needs to be 6.7 boston marathon bombings needed every year to justify the cost of the fbi so that is one every two months. that's a pretty high attack frequency. if you are more concerned about a london bombing than two of these attacks occur every year for the fbi to be cost-effective. the wood's expect the probability is not that high and as john mentioned most attacks in the u.s. and australia caused very little loss of life and very little damage. we could argue the 3 million-dollar expenditure probably might not be cost-effective. doesn't mean you should spend nothing. it's just that level of spending may not be the most optimal. so the first counterterrorism measures you tend to get low returns. what we say in the book is when we start doing a more detailed cost-benefit analysis we doubled expenses to $2 billion in 2003 that's probably about the level that is about right. spending more money but getting low reduction in risk so the numbers will become smaller. some perspective on this, the total home homeland security united states is $115 billion per year. that's just domestic counterterrorism. the fbi with the budget 3 billion takes up 3%. the fbi is probably 3% of spending you are going to get. to give you an example of full-body scanners at airports and marshals service, that cost more than $2 billion per year. calculations showed the risk reduction is one to 2% and any deal with the specific threats so if you figure into to the fbi is clearly preferable to some of these other -- we have done a lot of work on security and if we are looking at the threat hijacking or ieds security risks are reduced to 90%. this comes down to the concept of acceptable risk. i won't get into much detail. it's in the book but the federal air marshal service is two to 4000 air marshals in the u.s.. they fly on 5% of flights. there are there are and not helping against an improvised explosive device. the risk reduction is 1% probability so the benefit to cost ratio is .1 b. that means every dollar the government's bends they are getting 10 cents a benefit which is a very important return. if you compare those to some of the other security measures such as having pilots armed on the flight deck every dollar you spend to get $10 benefits so the benefit to cost ratio is much higher. the air marshal service we would argue is not cost-effective as the lowest risk reduction at the highest costs of before you go into more detail it doesn't seem to pay for itself. pre-check is something that john and i are looking at an area of security where there is screening for passengers who are seen as low risk so people can travel through the screening checkpoint much quicker so that saves the tsa at least $109 per year and that will increase in future years. their risk reduction is a very small risk saving a large amount of money plus passengers are much happier so that improves the passenger experience. that's something that is lower security lower-cost and still acceptable. finally talking about terrorist john mention what happens in the u.s. and australia is much different. this is a recent plot where couple of teenagers wanted to, they actually lived in the city, wanted to find a kangaroo or capture a kangaroo. put an explosive in its pouch, paint a kangaroo black with isis callers and let it loose amongst the public. so the u.s. isn't mastermind in terrace. thank you very much. [applause] >> it's a good thing we don't have kangaroo's running around the united states. thank you john and mark. it's my pleasure tinged as our distinguished commentator today. rosa ehrenreich brooks teaches courses on international law and national security constitutional law and other subjects. she also writes a weekly column and you have probably seen it on foreign-policy and she serves as a short senior fellow at the new america foundation. rosa returned to georgetown in july of 2011 after to your public service leave of absence where she served as counselor to undersecretary of defense for policy michele flournoy. during her time at the defense department rosa found that the officer rule of law and humanitarian policy and she led a major overall of dod strategic information operations efforts fail mention a few other highlights in her long and distinguished career. just a few things she was a weekly update columnist for "the los angeles times," back of the director of the human rights institute, special counsel of the society institute in new york and associate professor at the university of virginia school of law where she taught human rights law, constitutional law and criminal justice. with that rosa, take it away. thank you. >> thanks chris and it's great to be here. this is a fantastic look at my hope that you'll all stick around and buy copies of it created the book that i know i have been wanting this book for some time now because these are cost-benefit calculations i advised her to make itself in my own work and i'm not particularly good with numbers. i always fear that i'm making some embarrassing mistakes in my own calculations. i really recommend this book. it's full of useful details and useful numbers and i know i'm going to be referring to it in a times in the future. the whole thing reminds me of the old joke which i am sure you have all heard the there are many variants of the joke. a guy is walking down the street in your city and he is a stick in the keeps banging to stick rhythmically against every lamppost that he passes and finally another guy comes up to him and says what he doing it? where he doing that in the guy says they do this to keep away the tigers. the guy who asked the question said there are no tigers in new york city to which the guy with the stick said c., it worked. it's obviously very apropos for this massive counterterrorism apparatus to be created in which the answer whenever anybody raises the question about the efficacy of that vast amounts of money that are getting pulled into the department, security and the security council into counterterrorism policing etc. etc. you say is this worth it and the answer is well, we are preventing all of these terrorist attacks and you say but there haven't been any terrorist attacks and they say that's because we are preventing them. it's very hard to challenge that for most of us it's hard to challenge it because the assertion is usually coupled with regrettably i can't share the evidence with you because it's classified so you are just going to have to trust me that we need the collective several million people who earn our living or being part of this vast counterterrorism machine. you have to trust that if we work work here they would be in 9/11 attack every day that we swore we'd couldn't tell you about it. it's amazing people are falling for this. it's quite astounding and i'm going to come back to that in a couple of minutes. the book itself you have gotten a bit of a flavor for the kinds of things that are discussed in the book and i think one of the things that mark and john have done and comparing this to the witch scare in europe is really in some ways, gives us a good analogy for thinking about what this really is. they painstakingly go through their own cost-benefit analysis and they conclude as you heard that we are spending a vast amount of money with very little to show for it and this is money that could be spent on other things. you don't even really go into the question in which ways of some of our counterterrorism -- counterterrorism me being increasing the threat that we are trying to respond to, a whole other can of worms but at a minimum it's possible -- impossible to read this book and not come away from it thinking wow this is crazy. we are doing all these irrational things, not unlike the europeans in the 17th century and the americans in the 17th century who were thoroughly convinced of a variety of things. other nonsense, smoking out the real which is who were having with devils and then the think earn turning people and it dogs. we look at that and we say that's just goofy. burning these people at the stake is aldi's going to accomplishing knitting. i think it makes sense to think of the u.s. post-9/11 counterterrorism policy as in many ways sing many ways seeing it through an anthropological lens which is to say many ways it has absolutely nothing to do what with what nationals want to call reality. they have much more to do with mystical thinking, with mystical that we hope that any particular basis for believing this will ward off evil. they are all kinds of things in our world that we cannot control we feel we can control only get scared about the economy. we get scared that her kids are going to do well in school and we are scared about her health. we can't control any of these and justice seeking out and a string which is becomes a way to take all the things i did about a million other things and put them on something that feels like you are doing something i think terrorism for modern america and the effort to root out terrorism has become very similar. the former ritual. it bears almost no relation to the stated and it has and the becomes a substitute for actually doing anything particularly useful. in some ways it becomes a substitute for having to think about the harder and more frighteningssues that we as they might be able to do something about if we put our minds to it instead of chasing ghosts and counterterrorism. the biggest challenge so and my suggestion that this would be better for an anthropological frame them to the cost-benefit frame of economists and political scientists and engineers perhaps leads to this question. when i say this i don't at all mean to say the cost benefit and also supports is the wrong approach. it clearly is the right approach. clearly if we wish to sustain a belief in ourselves as a political committee in azteca america that is not just magical thinking over reality-based thinking or were magical thinking over trying to think seriously and analytically about problems and so forth really have to engage in the same kind of announces that this book does engage and we have to do it courageously and i also want to say it takes courage to write this book. we still live in a culture in which if you write a book like this semi-assure you both been on the receiving end of this and will be again you are exposing yourself to people saying oh yeah here but the 9/11 day and you don't care about the boston marathon. you evil person, how will you feel when you are family is killed by a terrorist, then you'll be sorry. you will get that and you have gone and i'm sure. it's of course wildly unfair for someone to say look at the good that number of people killed in car crashes has gone down but there's a limit to how much money signed to spend on me can cars safer. it doesn't mean he wouldn't be sad if someone you loved -- it just means where i was making hard choices. we want our government to be the kind of government as you said we want our government to be risk and agile. we want our government did not panic and not engage in magical thinking and not engaging crazy does versions of risks and threats and so forth but we are not rational, most of us. we think we are and that we are not in this is in fact in some ways an anthropological case study in how hundreds of thousands of intelligent people, and millions of intelligent people come all the people that worked for the federal agencies, millions of extremely intelligent thoughtful people have managed to convince themselves that make sense to dedicate their working lives to an enterprise that the book suggests is fundamentally flawed , and absolute waste of money. we are not in fact rational people. this is the challenge i think. they wonder what the purpose of these federal agencies have around since 9/11 is. you could say the purpose is protecting themselves and the american public from the devastating threat of information that might change our minds our policies. we know that americans humans in general perhaps americans in particular are horrible at risk analysis to start with. we panic about peanut allergies. we panic about the threat of child affection. we overreacted and we say nope peanuts in every school despite evidence that it makes peanut allergies worse. we keep our children, and we don't let them go to the park despite evidence that exposes them to other wrist including obesity if they don't go out anymore because god prepared to go to the playground and are abducted immediately. they are all kinds of things we think about that don't bear any particular relationship to the actual risks out there. the foregone benefits when we choose a risk of vision about one thing or another. we also live in a world which as we all know america has become more politically fragmented into smaller and smaller subaudience subaudience -- subaudiences. each of those with their favorite new show in tv source and internet source which permits us to screen out conflicting information that doesn't accord with the preferred way of thinking about the world. scott and tougher and tougher to find ways to speak to americans generally much less to find ways to get them to listen seriously to things that might change their mind about deeply held belief systems that have really that belief systems, religious belief systems much more than they have the status of beliefs that have been developed through some empirical assessment of the world around them. my fear is that i'm going to read it and i hope some of you are. and we will say yes this is right. this is completely persuasive. we are wasting several trillion dollars. there are sensible things that we can do to reasonably reduce the risk of terrorism that we have gone overboard by a factor of a couple thousand, who knows? and despite the fact we are going to come to that conclusion , most people want and if we walk around saying to our friends and family members and cousins and aunts and knuckles and your congressman that they will go back to where i started which is well yes but you have no idea, how worse things might be. there hasn't been terrorism is because of all of this. it's true because it's working and not only that you were a terrible person who doesn't care about counterterrorism and you are putting your head under the sand and you are cowards and all sorts of un-american things. how do we break through that? that is the biggest challenge of all and the book, your fine book doesn't focus on that and there's no particular reason you should pity of a different task but the broader challenge coming out of it is this is not dissimilar to let say we discovered that it commonly taken vitamin supplements is in fact terribly dangerous to people but how do you convince people not to do it when they are absolutely determined to believe otherwise? the only thing that gives me some hope obviously is political moods do change over time. they seem to get worse more easily than they get better but when i think back even to europe in the late 1970s or early 80s and this comes through a little bit in your book, that was the period in which the annual deaths from terrorism in western europe were three or four times higher than they are now. it wasn't because of islamic extremist terror groups. it was because the ira and separatist and because of antifascist terror groups. you name it they were civilian terror groups all over europe which collectively manage to do an enormous amount of damage. europe did not come apart and my defense was the degree of public panic was much much lower than it is now. it's not impossible for political cultures to decide to treat terrorism quite differently, to take it much more in stride as it's horrible, it's a crime. there are plenty of things we can and should do to try to minimize the likelihood of terrorism that we don't have to let it turns inside out. we just don't have to do that's i think the challenge is how do we break through our collective resistance to taking on new information that will challenge a belief system that really has turned into a full-fledged bubblelike belief system? how do we take new information and get true that opal in a way that will actually lead to political change and policy changes and budgetary changes? i'm going to let that question because i want to make sure we have time to discuss that but again it's a terrific book and it's an honor to be here to talk about it. thank you. [applause] >> thank you rosa. i'm going to briefly exercise my prerogative as chair to pick up on something that roses at its beginning and at the end in terms of how you respond to the charge that you don't care. think one of the strongest parts of this research that i liked that you said today mark is that individuals can be risk-averse. individuals can choose not to undertake certain risky behaviors but governments should be risk neutral. this is so important because when the government is seen to be dedicating resources that are vastly out of proportion to the dangers that they are facing, then caring about one thing implies not caring about other things that are more likely to result in premature death or injury. so to me this book does address that you don't have a question that way but i think it's very helpful rosa how you team data. that's how i've approached this problem since i encountered your work. >> maybe we should say don't you see that if only we took more money out of the counterterrorism pot ended at has stalled -- gave it all to addressing peanut allergies? >> please wait for the microphone for the benefit of those on c-span on line. please identify yourself and your art affiliation if you have one. out of courtesy to the speakers on the stage and your fellow attendees please make it a national question and that is a statement that antenna question mark so no speeches please. the back. right there, go ahead sir. >> my name is olivier lewis and i'm a visiting researcher at georgetown. i have a question about, talking about money for these issues and the question is twofold. how much can we link effectiveness to the budget because i think that is what is being insinuated here. when we did the reform of homeland security or the intelligence community that wasn't just related to budget the more organizational issues so if terrorism were to increase or if you would include gun violence, would your argument be we should increase the budget or css flaw there? and more fundamentally how do you quantify some of the things you are talking about on both the cost and the benefit such as the person's life and on the other side in terms of loss of personal privacy. >> okay, thank you. you want to take that one. mark? >> on the issue of cost verses effectiveness, it's a very good one. what do other countries do? in the u.k. we have a higher terrorism threat over longer period of time. they spend half of their per-capita gdp on what's happening here and yet they seem to be just as effective. australia and canada, we spend about a quarter as a portion of gdp per-capita and these agencies seem to do very fine job as well. how is it that the united states seems to be fairly excessive? and be un-american. in terms of how we quantify the cost benefits, that's going to be a challenge. what i am finding is you don't need 20 ph.d. topics to solve this. you can do straightforward "back of the envelope" type of destination. within -- 10 to 20% to give you good feel, is a complete waste of money or is it somewhere in the middle? if it's someone the middle i can spend more resources that we do include the value of life in our analyses and that number varies a lot through different governing agencies. between two entry may be 10 million. we is 7.59 which is based on a deep dhs report done in 2010. most of the losses from terrorism, loss of life is obviously very tragic in terms of a cost benefit analysis most of what affects society is really the direct losses. deciding not to travel affects tourism and loss of business and there are a lot of effects on that. .. they come out with maybe 100000000000 - $200 billion. in that case in that case the indirect cost, the secondary cost, economic costs are higher in that case than the direct cost. there are other terrorist events, for example the fort hood shootings, basically there's not much in the way of indirect cost per there's the direct cost of the deaths but there were people avoiding going to fort hood or texas so the indirect cost are quite limited. there's a third kind of cost. there is the direct cost and indirect cost but the third cost is reaction cost. it is if you include that we don't deal with those you include those they can be astronomical because one of the reaction cost of 911 was the multitrillion dollar set of wars in the middle east if you want to call that a cost of 911 the cost gets very high. life is not infinitely valuable. you have a finite amount of funds. if you don't think or you do think it's infinitely valuable, you'll be in favor of changing the law so passenger automobiles can only go 13 miles per hour. that modest proposal, would save dirty thousand lives every year. if you don't think that's a very good idea, it means you're willing to spend 30,000 dollars, 30000 americans die every year from this particular hazard. you simply can't avoid the problem. >> right there. >> i've a question question about what recently happened in france and again in brussels. both governments, we found out are spending a lot less gdp on security and both governments have said they're going to increase their expenditures. are they making a mistake? are they reacting to these events. is the u.s. the house on the block that has the big dogs and therefore they're going to places that are easier to access such as france in brussels? thank you. >> i don't know that much about what is happening in europe, but one of the problems has been a lack of police coordination because of language and all the different countries. the thrust seems to be moving toward better policing but that may cost more money but it is probably beneficial for dealing with terrorists and crime and a bunch of other things. i don't know what the numbers will be, if the as hysterical as they were after 9/11 in the united states but clearly the reports coming out of brussels indicate the police did a rather poor job of keeping these guys under surveillance. >> right there. >> i spent my career in security and counter intelligence and i was reminded of the battles we had during the '90s, before 911 of risk avoidance versus risk management. i guess my question is, how many brussels in san san san bernardino's you think are acceptable? >> yeah, i know know. >> the answer is none. they basically have to overreact for under react. and. >> a lot of heads would roll, a lot of heads rolled over 911, much, much less san bernardino. one thing a politician should say is that bad things happen and if we keep them low enough for in pretty good shape. they should also be saying things like your chance of being killed is one in 80 million a year. that would nice to hear but it's basically never there. >> the police department doesn't say we will have no murders this year. we expect bad things can happen. they can all be foreseen. murders and burglaries in violent crime is going to happen in the public seems to accept that as a fact of life. so if the politicians can manage expectations and say well these things can happen but it doesn't mean in someone's fault. >> this gentleman in the front. >> hello. i'm from the cato institute. my question is, now that we have so much high-tech, i wonder if there is a device that can be designed to stop this with laser weapon or electric shock they are making a choice to elevate one type of risk over another. that's a political platform. that doesn't mean they have to spend a lot of money. they have been very tough on terrorism and security, but the spending didn't match the rhetoric. they can still get a lot of political advantage without spending much. >> let me add one note on that, essentially governments are forms for public safety. the first words in the constitution are to preserve tranquility. they have a limited budget and they should use it in the most productive and scientific and careful systematic manner to maximize the number of lives saved. they are spending $1 billion dollars to save a life with one device but another device only costs $100,000 and they're ignoring that. that's extremely irresponsible. they often say they have to do that because otherwise they will lose their jobs. my position on that is basically, if you you take a job in which making career threatening decisions may come out, you should make those career threatening decisions. if you don't like make making career threatening decisions, don't take the job. there's a lot of safe jobs out there like plumbers and college professors they don't have to go through this agony. it's basically fundamentally irresponsible duty to miss misspent public funds in a manner that doesn't maximize public safety. the numbers are not always precise but there should be an a systematic effort to do it. it has been done well in other areas which is nuclear radiation and the siting of nuclear reactors. >> right there and then in the front. >> i'm with the cato institute. i noticed the pre-check program gets pretty good treatment in your assessment of security programs where people pay a little little money and share a little action and then don't have to go through the strip search machines or imaging technology. is that because of background checks providing a lot of cost-effective security or is it because letting people get away from the time-consuming and expensive machines is avoiding a lot of costs that would be wasted. what does the heavy lifting consist of. >> were working on doing a risk assessment at the moment. were not fully aware of what the metrics are. we seem to like it because it actually treats people as low risk. it recognizes that most passengers are low risk and therefore they should be treated accordingly when it comes to security screenings. so this is a really good example of tsa using risk based approaches. we think this is a pretty good step. and it saves money. >> james over there go ahead. >> did any of the analysis identify any top corporations receiving any of this money? any big corporations? >> are there companies that you identified that are benefiting from this expenditure? >> yes, a lot of them. there is a whole thing about the terrorism industry but i don't blame the companies. if you find out that the transportation security administration wants to buy a zillion x-ray machines in your selling x-ray machines you're likely to be in washington in a flash. when you get there, you're you're not likely to say you don't need these x-ray machines but we have nice ones should you decide that's the case. it's really up to the public safety people. they should be spending money and an appropriate manner. they must expect that people have things to sell and they're going to try to sell them. there's big carnivals, basically for homeland security expenditures of people trying to sell their wares. some of them are very good probably maybe they will increase security and reduce cost. that's very important that should be something. [inaudible] it's ongoing, so so thank you for that. specifically i think you for the analogy or metaphors. i certainly thought of calvin calvin and hobbes, the imaginary tiger as a kid my question is have you been in the company with homeland security who may have a response to what is actually going on behind the scenes that he could reveal in regard to your assumptions. >> we tried various times to get through but it doesn't seem to be working very well. when rosa brooks talks about getting the message across, there there isn't a whole lot of receptivity. to give you an extreme example, because of the total no-brainer which is the federal air marshals. we've looked at about 748 ways and other people have to. basically when you look at it, it's an incredible waste of money. it doesn't doesn't improve risk reduction much at all, if at all and it cost an incredible amount of money, $1 billion a year. we've had some proposals where they keep some marshals and they shift some things around without changing security around. both the airlines and the taxpayers would save several hundred million dollars every year. we've sort of puts this in various places and so far one member of congress, duncan from tennessee has actually said we should get rid of the air marshals. even quoted us. i was flabbergasted. somebody's actually saying it. when we were in washington a few months ago we visited the office of duncan and talk to some of his aides and he said duncan couldn't get anybody else to sign his bill to get rid of the air marshals. so you're starting with something that is bone crunching lee obvious. it's not subtle, it's just on the face of it. if you analyze it, it proves to be exactly right, and nothings happening. >> you no, i don't want to put words into jay johnson's mouth or anyone else's, but the only thing i will say is my own time in government, i certainly didn't come across anything that mimi doubt the the basic premise of this book or cast doubt on the premise of this book. two other things, one problem with giant bureaucracies is the responsibility, you've got lots and lots of people, as i said the mystery of all these smart people doing something completely irrational, but they each have a tiny party enterprise. they don't actually have this book. they're not looking looking at it that way. they're looking at it as my job is to be the person who helps recruit federal air marshals or my job is to be the person to help book the flight. i'm not responsible for figuring out whether this whole vast enterprise makes sense. they don't know. they shouldn't necessarily have to know. it's not their job. then the question is who puts all the pieces together at the end of the day. the other thing i will say is i have also met very few people within the federal government or security apparatus who won't say privately that at least a great deal of that whole apparatus is nonsense. this is not wholly unknown to people, but it becomes well, you're not intelligent because your job is just the guy who books the flight. so i think part of this is a massive collective action problem. there are lots of people who are broadly speaking, aware of this, but they don't have the authority or the portfolio to say so or they don't want to lose their job or it's not the right moment or they don't want to go testify. do not screw up by saying yes mr. chairman, everything we do at my agency is pointless. then they will be out of a job tomorrow. so i think there are lots of reasons that the system stays in place despite the increasing body of evidence that suggests they need some fairly drastic changes. >> go ahead. >> an issue i find in the states is that the apparatus involves hundreds of different government agencies. as john mentioned, it's a service, it's a agency. they have gymnasiums and training centers, it's a a separate agency. as soon as we start saying you might want to cut down those numbers, then some of those careers are coming to an end. in australia we have very few agencies. we have just a couple agencies yet we still cover the same amount. amount. it's easier to redeploy resources internally. they are having police officers go on duty to do this. another time, they can shift their air marshals quite easily. they can increase them or decrease them or do whatever they want with them. there's internal deployment. >> thank you all for your remarks. please join me in thanking our panelists today. >> i want to invite those of you were with us today on the second floor of the conference center for lunch and continue discussion on conference. i expect that you have plans to, it's just $18. that's close close to 40% off the cover price. i'm sure mark and john will be happy to help you. this is the first day of the major baseball season so go orioles. thank you all for coming. [inaudible conversation] cspan created by americans cable companies. >> brooke stoddard is an editor of national geographic. he also, what is the current state of fuel in america question. >> it's not as powerful as it used to be. it uses fewer men and women because of the machines are better and more productive as they were in the old days. it's a very highly sophisticated industry, a little more disperse it's just burst around the country not just in pittsburgh anymore. it's very highly sophisticated. that's one thing i wanted to try to talk about in this book. it's chemistry, physics, and the engineering that goes into it is really fabulous. >> wears the majority of the production taking place? >> south chicago is very big. northwestern indiana and they're still mills in cleveland. there's a big mill in birmingham, alabama. it's dispersed dispersed around. the carolinas have electric furnaces. >> in your book you visited a mill. you took and or vote from duluth to cleveland what was that like. >> a lot of the steel in america used or that comes from around lake superior. the iron ore will be mined in lake superior and load up boats in duluth minnesota and come down to the lower lakes near chicago or cleveland. from there they were dispersed to the iron mills. it was very interesting part of the steel industry. >> who is the largest iron exporter now if it's not us? >> i think australia. they export a lot of iron ore to china which is building up its infrastructure and creating a lot of steel for itself. >> what has happened to the former iron hubs? how are those cities doing now in the steel industry? >> they are bouncing back pretty well. pittsburgh in particular lost nearly all of their steel manufacturing but they've reinvented themselves with newer smaller companies. they put their minds to it and they've come up with new things. >> how has technology changed how we extract or and work with steel? >> in a way it hasn't changed all that much. you need to extract iron ore from the earth, reduce the iron or to appoint where you can work with it and those principles are about the same as they've been for centuries. it's just that the machinery is more sophisticated and requires fewer men and women to wk