Prof. Lazear's Reaction to the Terrorism
Edward Lazear, Jack Steele Parker Professor of Human Resource Management and Economics
Issue date: 10/1/01 Section: Perspectives
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In thinking about what has happened, it is hard to say things that aren’t trite or obvious. But I would like to say two things:
First, as you look at what has happened, one has to be careful to avoid focusing too much on revenge. That isn’t the key. They key is deterrence. We need to focus on the future, not the past. Suppose that Bin Laden were not guilty of this particular act. Would it matter? Wouldn’t we still view him as a major threat to our future security? The problem should be defined in terms of who will hurt us in the future, not who has hurt us in the past.
I felt that during the first couple of days, the administration was talking too much about catching the culprits in last Tuesday’s attack, and not enough about how to prevent these sorts of attacks in the future. Although revenge makes people feel good, we need to focus on preventing a recurrence.
To that end, we should go after the states that support these terrorists, although that won’t be sufficient by itself. In the process, I suspect the administration will be less concerned about the sovereignty of nations than the U.S. has in the past. That’s the correct strategy at this point. But we should proceed with patience. We will gain very little if we respond too quickly – especially if we destabilize the moderate states like Egypt, Saudi Arabia, and Pakistan who already are dealing with problems of their own.
Second, in terms of the economy, it is still pretty strong. I would hate for people to get the notion that things are falling apart. They are not. We have experienced a mild downturn, but the economy is fundamentally sound. And the rebuilding and additional activity that will be needed to recover from the attacks should encourage future economic growth as it draws more resources back into the economy and provides incentives to invest in physical and human capital.
First, as you look at what has happened, one has to be careful to avoid focusing too much on revenge. That isn’t the key. They key is deterrence. We need to focus on the future, not the past. Suppose that Bin Laden were not guilty of this particular act. Would it matter? Wouldn’t we still view him as a major threat to our future security? The problem should be defined in terms of who will hurt us in the future, not who has hurt us in the past.
I felt that during the first couple of days, the administration was talking too much about catching the culprits in last Tuesday’s attack, and not enough about how to prevent these sorts of attacks in the future. Although revenge makes people feel good, we need to focus on preventing a recurrence.
To that end, we should go after the states that support these terrorists, although that won’t be sufficient by itself. In the process, I suspect the administration will be less concerned about the sovereignty of nations than the U.S. has in the past. That’s the correct strategy at this point. But we should proceed with patience. We will gain very little if we respond too quickly – especially if we destabilize the moderate states like Egypt, Saudi Arabia, and Pakistan who already are dealing with problems of their own.
Second, in terms of the economy, it is still pretty strong. I would hate for people to get the notion that things are falling apart. They are not. We have experienced a mild downturn, but the economy is fundamentally sound. And the rebuilding and additional activity that will be needed to recover from the attacks should encourage future economic growth as it draws more resources back into the economy and provides incentives to invest in physical and human capital.