The value of a human life

Economics and science have created injustices that legal systems cannot solve. Two looming problems are climate change and ageing societies

Modern economics has become a contest between human values and economic valuations, caused by two conceptual problems. One is the utilitarian principle. The other is the impossibility of quantifying a human life. Economic cost-benefit valuations have corrupted human values, as well as public policies and legal processes.

A good policy, according to the utilitarian principle, benefits the maximum number of people, even if it harms a minority. Utilitarian policies are politically popular because a majority favours them. The utilitarian principle does not protect the rights of marginalised people, whose needs are trampled upon in the march of economic growth. Political and economic majoritarianism are natural partners. A majority persuaded that it will be economically better off turns away from the needs of those left behind. The majoritarian principle may be good for electoral politics, but it limits a democracy. In a majoritarian democracy, not only are the majority better off, they can be persuaded they are inherently better people too.

The benefits and losses must be quantified to compute overall gains and weigh losses amongst sections of society. The application of cost-benefit analysis put economists in the driving seat of policymaking in the last century, explains Binyamin Appelbaum in The Economists’ Hour: How the False Prophets of Free Markets Fractured Our Society. Economists were able to persuade political leaders to apply cost-benefit analysis to evaluate the impacts of regulations and take supposedly rational decisions. In the 1960s, the US government weighed costs of weapon systems against the values of lives destroyed in the Vietnam War. In 1971, the US President asked the government to weigh the economic costs and benefits of environmental protection.

In economics, all quantities must be converted into money values to fit into the same equations. Human beings are not equally valuable in economics. Those who earn more and consume more, and thereby add more to economic growth, are more valuable. When a US court determined the compensation payable by Union Carbide for the losses of 15,000 Indian lives in the Bhopal gas tragedy in 1984, it said an Indian life was worth only a small fraction of a US life because people in India earn much less.

Older persons, who are not as economically productive as younger persons and have fewer years to live, are not as valuable to an economy as younger persons with more years to contribute to the economy. Improvements in economic conditions and medical science, and reductions in birth rates, have increased longevity around the world. Fewer young people must support more older ones. Older persons need more care as they age, the economic resources for which must be earned by younger people. Adequate pensions for longer periods for older persons require the state to tax younger people more. Older persons seem a burden to society in economic terms, though they make many contributions to society that are not monetarily valued.

India’s Supreme Court recently declared that human beings have a right to protection against climate change (while hearing a case about the rights of a rare species of bird, brought to it by environmentalists against companies building renewable energy infrastructure to mitigate climate change). Environmental degradation and climate change affect human lives in many ways: Air pollution, extreme heat, drought, floods, etc. There are also many causes. Foremost amongst them being human actions to exploit nature for economic growth, such as mining, industrial agriculture, and large plantations, as well as unintended consequences of schemes to harness nature, such as diversion of rivers, construction of large dams, and infrastructure for renewable energy. It is not possible to assign responsibility precisely when there are multiple causes and effects. Nor can costs and benefits be mathematically computed. For example, how much is the value of the life of a poor old woman in Papua New Guinea, compared to that of a baby born in a rich family in Colorado?

Power in governance systems

Laws cannot guarantee equality. The UN General Assembly adopted the Universal Declaration of Human Rights in 1948. It set up the International Court of Justice to ensure that humans in all countries are treated as equals; also, a Security Council of powerful nations to enforce UN resolutions. Yet, 75 years later, innocent children are being killed in Gaza by the weapons of countries that consider themselves more equal than others, and more righteous too. Perhaps they have made an economic cost-benefit analysis of the collateral loss of civilian lives with their high-tech “precision” bombs.

A free marketeers’ solution to complexity is to leave the future in the invisible hand of the market. Governments and regulations just come in the way of the beauty of the market, they say. Beneath the beauty is the ugliness of power. Power must shift from the powerful in institutions of governance to the powerless, internationally and within countries. This is essential to make human progress more sustainable and the world more just.

The ideology that governance of society by the people is bad because it is not economically efficient has taken over the governance of democratic societies. Maximum market, minimum government, with policies made by experts. Power accumulates by a process of cumulative causation. Those who have power make laws that increase their power. They control institutions that implement the laws; even courts of justice that conform with their ideology, and  insist must be guided by experts like themselves.    

Public policies should be guided by human values, not economic calculations. Equality of all—white or black, rich or poor, young or old—demands that every life is equally valued and given equal dignity. Older people and poor people must not be diminished into numbers in economists’ equations. Poor people don’t want just a large economy. They want a just economy. They want equal opportunity. Their voices must be heard and given equal respect in the governance of the economy and society.

The writer is chairman, HelpAge International