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EPA: Your life is now worth 11 percent less

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The Associated Press examined the Environmental Protection Agency's cost-benefit analyses over the past 12 years and came to a startling conclusion: The statistical value of an American life is worth almost $1 million less than it was five years ago.

From 1996 to 2003, the EPA valued a life at roughly $7.8 million to $7.96 million in current dollars. In 2004, in drafting a major air-pollution rule, the agency lowered it to $7.15 million in current dollars. Then in May, in a regulation covering air pollution caused by trains and boats, the agency removed the normal adjustment for inflation, reducing the figure to $6.9 million. Between the two changes, the value of a life fell by 11 percent in current dollars.

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These calculations are far from abstract. As the AP explains, government agencies use this figure to weigh the costs and benefits of a proposed regulation:

Consider, for example, a hypothetical regulation that costs $18 billion to enforce but will prevent 2,500 deaths. At $7.8 million per person (the old figure), the lifesaving benefits outweigh the costs. But at $6.9 million per person, the rule costs more than the lives it saves, so it may not be adopted.

Unlike insurance companies and juries, the EPA's figure is not based on your earning capacity. Rather, the EPA arrived at it by examining payroll statistics to see how much employers are willing to pay workers to take on extra risks. The EPA also looked at opinion surveys to come up with their number.

According to the AP, the EPA says that "people shouldn't think of the number as a price tag on a life."

The AP also notes that the EPA places the highest amount of value on a human life of any government agency.

Of course, depending on who you are, the US government may be placing a different value on your life. As the Houston Chronicle reports, the US Secret Service has budgeted $110 million this year to provide protection to presidential candidates.

By contrast, in Iraq, families of those accidentally killed by US troops in combat sometimes receive a condolence payment. That figure is capped at $2,500.

[Via: EnviroHumaImpact]