Leveling the Field

Risk, danger, and devaluing the dollar

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A basic knowledge of hazard analysis should be part of everyones education, but it is laughingly absent in the general population. Only engineers and scientists seem to have the working understanding of the difference between danger and risk that people need to make everyday decisions, or to guide a country through difficult times.

A glaring example is the fall-off of air travel after 9/11. The common perception is traveling by airplane suddenly became too risky and/or dangerous. In fact, the risk (that your plane would fall out of the sky) was not significantly increased by the slight statistical anomaly of three planes crashing on the same day. The danger (that everyone in a plane would die) changed not a whit,thats just part of riding in an aluminum tube more than 100 feet off the ground.

Yet the government and the airlines devoted enormous resources to trying to improve the already incredibly high safety of air travel, in the process all but destroying its last vestiges of civility and convenience. The net effect is air travel now appears much less safe than it is, and the industry has been brought to its knees.

Other efforts to "fight terrorism" and "increase homeland security" are on the same critical path, offering little in the way of measurable results at great costs in dollars, lives, and personal freedom.

Meanwhile, these and other efforts to ostensibly secure the safety of modern living distract the population and divert resources from other steadily increasing risks. These risks apparently dont have the same pulling power on CNN or at the polls, but have much greater potential to destroy the American way of life--at least as its experienced by the average process control professional.

One increasing risk is losing your livelihood as engineering services join the manufacturing and IT software development jobs moving overseas (see "Control Report: Time to Fight Back" www.controlmagazine.com/Web_First/CT.nsf/ContentFrameset?OpenForm&ArticleID=PSTR-5QYPN7).

Another is deconstructing your financial future by running the national debt up to record levels. Remember the huge $237 billion surplus of 2000, earmarked to for Social Security by both parties in the 2000 election? The bipartisan Congressional Budget Office now projects a $455 billion deficit this year, and $480 billion next year. The independent Center on Budget and Policy Priorities says it will be more than $325 billion for each of the following 10 years.

That money,about 25% of all government spending--has to be borrowed from Americans and foreigners. But Americans arent saving much, and foreign investors are already shelling out $500 billion a year to finance the U.S. trade deficit. Financing the national debt may mean raising interest rates, further stagnating manufacturing investment, making housing more expensive, and courting inflation.

"The Johnson and Nixon administrations financed the war in Vietnam with deficit spending," reported R. C. Longworth, Chicago Tribune senior correspondent, on August 31. "The result, which lasted long after the war ended, was double-digit inflation, sky-high interest rates, a lost decade for investors, and a good, stiff recession."

Whether by under-funding Social Security or raising taxes to reduce the deficit, or by killing manufacturing investment and your 401(k) with high interest rates, the outlook for every U.S. citizen (not just a hapless few on doomed flights) is threatened by deficit spending.

But being the cheery optimist that I am, I cant help but think theres a method to this apparent madness. Engineers or not, our leaders are intelligent and educated people. Perhaps their long-range goal is to weaken the dollar to the point where the balance of trade corrects itself. A weak dollar means the costs of imports (including manufactured goods, oil, and outsourced engineering) would rise significantly. Wed still have our jobs, we just wouldnt be able to buy as many inexpensive products or as much gasoline as were used to, or as big a house as wed like.

Maybe thats exactly what is needed to level the field.

E-mail Paul at pstudebaker@putman.net.

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