The economic logic of executing hackers.

How the dismal science applies to your life.
May 26 2004 5:14 PM

Feed the Worms Who Write Worms to the Worms

The economic logic of executing computer hackers.

(Continued from Page 1)

On the other hand, suppose we can execute one vermiscripter and thereby eliminate, oh, say, 1 percent of all computer viruses for one year. Assuming that half the $50 billion cost of malicious hacking is concentrated in the United States and that you bear your proportionate share of that cost, we're putting about 83 cents in your pocket.

Which would you rather have, the safety or the cash? Almost every American would take the cash; that's exactly what we learn from studies like Viscusi's.

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Executing the murderer means giving you the safety. Executing the vermiscripter means giving you the cash. You'd rather have the cash than the safety. Ergo, executing the vermiscripter is better policy.

There's one exception to this reasoning: Maybe there's an alternative and less drastic punishment that is highly effective against vermiscripters and not against murderers. If we can effectively deter malicious hackers by cutting off their supply of Twinkies or crippling their EverQuest avatars, then there's no need to fry them. Whether that would work is an empirical question.

Some might argue that capital punishment has moral costs and benefits beyond its practical consequences in terms of lives lost and lives saved. Those who make such arguments will want to modify a lot of the calculations in this column. As for myself, I hold that the government's job is to improve our lives, not to impose its morality. In this, I take my stand with the president of the United States, who, in a 2000 debate against Al Gore, said quite explicitly that nothing other than deterrence can justify the death penalty.

There's also the fact that all the arithmetic in this column is very much back-of-the-envelope. I implicitly assumed that we're all equally likely to be random murder victims when in fact some of us (i.e., the poor) are more susceptible than others. I used numbers that are rough approximations to the truth. And I probably omitted a consideration or two that I'm sure I'll hear about from astute readers.

But this essential point remains: Governments exist largely to supply protections that, for one reason or another, we can't purchase in the marketplace. Those governments perform best when they supply the protections we value most. We can measure their performance only if we are willing to calculate costs and benefits and to respect what our calculations tell us, even when it's counterintuitive. Any policymaker who won't do this kind of arithmetic is fundamentally unserious about policy.

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