How Much Is a Life Worth?

I’m a supporter of foreign aid for health, because I believe in helping the less fortunate, but also because I think it’s a great investment for the United States. As I wrote in my book with Philippe Douste-Blazy, saving lives in poor countries is cheap, but incomes in poor countries are rising. The people saved will buy American products and generate far more tax revenue via American exporters than taxpayers paid to save their lives.

Recently the development expertsToby Ord and Owen Barder have been making a different case for foreign aid that’s also based on value for money: it’s cheaper to save people’s lives in poor countries than it is in rich countries. On average, they say, the United Kingdom’s National Health Service spends about $160,000 to save a life. If you believe a life elsewhere is worth as much as a British life – and I do – then simply curing smallpox, which saved millions, was worth all the money ever spent on foreign aid.

Essentially, their argument is that if people in the United Kingdom think a British life is worth $160,000, then a life anywhere should be worth $160,000 to them. I don’t think it is, and that doesn’t mean Brits are racists.

To British taxpayers, there’s some chance that the lives saved by the NHS will have a concrete value that depends on local prices and incomes. For example, in a family, helping the children’s grandparents to live ten more years might save tens of thousands of dollars in day care expenses. Saving a life abroad wouldn’t necessarily help with these expenses. In part because the NHS has primary responsibility for saving British grandparents’ lives, British taxpayers are willing to pay the $160,000.

If British incomes were to rise, then Brits might be willing to pay more to save each life. After all, day care would be more expensive. Would that mean the value of a British life had increased? In the kind of concrete terms I use above, yes. Would it mean that the value of a life anywhere else had increased, too, simply because British incomes rose? It’s hard to see why that should happen so mechanically.

Ord and Barder might argue that these local economic effects shouldn’t matter: a life anywhere has the same value, period. By that logic, we should save as many lives as we can at the lowest possible cost, which is what the Gates Foundation professes to do. But if the British government also took that point of view, there would be no NHS; the government would run out of money before it ran out of cheaper lives to save in foreign countries.

So, does wanting to have an NHS at all mean Brits are racist? Not to me. You could even say that the NHS should pay a lot to save each British life because, over a lifetime, each Brit will pay enough taxes to save many more lives abroad. Indeed, Brits can be valuable lifesaving machines! But admitting this would contradict the “every life is equal” principle.

The Ord and Barder argument breaks down further when you begin to consider other countries’ spending. For example, let’s say the Sri Lankan government pays just $1,000 to save each Sri Lankan life through its health system. Should Brits value Sri Lankan lives more than Sri Lanka itself does? Sri Lanka is a poorer country, of course, but every government has a budget constraint. You could argue that Sri Lanka would spend more on health if it could, but then, so would the United Kingdom. It’s unlikely that either $160,000 in the United Kingdom or $1,000 in Sri Lanka reflects the true value of a life to the people of the respective countries.

In fact, if money were no object, the value of human lives – the amount we’d be willing to spend to save them, including our own – would probably be infinite. Putting any value on a human life requires the recognition that pragmatism does not always go hand in hand with principle. The $160,000 figure is a product of pragmatism in the United Kingdom. Perhaps it really represents the underlying value of a life plus the other stuff Brits get when that life happens to be British. Using it to apply the “every life is equal” principle just doesn’t work.

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