Economies of scale in homeland security?

Sarah Vowell (NY Times) writes:

...last year, [the Department of Homeland Security] distributed $38.31 per resident of Wyoming, but only $5.50 for each person living in the state of New York.

When Senator Hillary Clinton started using the adjective "threat-based" in talking about how to divvy up the homeland security funds, I thought my head might explode. Not because she was wrong. But because - simpleton that I am - I kind of assumed that the "threat-based" thing went without saying.

I was clueless enough to think that the very idea or, let's face it, ideal, of effective counterterrorism involved, at the very least, an educated guess about our national vulnerabilities - and I even thought that the money and equipment and personnel would be distributed accordingly. Which probably sounds simply adorable to those of you who have ever heard of the United States Senate.

I love Wyoming. I grew up right next to it in Montana. But from where I now sit in an apartment in the Flatiron neighborhood, staring at the Empire State Building, an apartment that, admittedly, isn't the Brookings Institution or anything, but does have high-speed Internet access and all the cable channels, it seems to me that New York has more ports and borders and financial centers and people and, yes, subways, so Wyoming could stand to throw a buck or two more our way per person.

I really don't understand the part about high-speed Internet access and all the cable channels. Is she trying to say they don't have those things in Wyoming? Maybe not in every nook and cranny of the state, but the cities and towns are not exactly primitive. That seemed a bit gratuitous.

Anyway, the mental arithmetic here is pretty easy, so let's talk about it. It so happens that the population of Wyoming is just about 1/2 million. New York is just about 19 million. New York has about 38 times the population of Wyoming. Hence, by the numbers Vowell cites, you could wipe out all the Homeland Security spending on Wyoming and it would only add another dollar per person for New York. Putting New York and Wyoming on equal footing in terms of per capita spending would require eliminating nearly all of the spending now going to Wyoming.

I'll leave it to the reader to contemplate whether eliminating Homeland Security spending for Wyoming (or Montana, North Dakota, etc.) would be appropriate. Your response will probably depend, at least to a degree, on whether you live in more rural areas or not. I live in a college town in a rural part of one of the most populated states in the country, so I can see this one from both sides.

The fact of the matter is that the quantity of Homeland Security services provided in rural areas is less than that in urban areas. Yet, there is a certain fixed cost associated with providing certain types of security. For example, providing security at an airport in Cheyenne requires a significant investment in equipment, not to mention a commitment to an ongoing cost in staffing--just like it does in New York. Now, of course, a small airport may have only one security portal and a large airport has several, but even then, there are certain economies of scale. Now, think about how many more people pass through JFK than pass through Cheyenne Regional Airport. Remember too, that the security chain is only as strong as its weakest link and you realize that there simply must be some disparity in the per capita spending on things like airport security. It's simply a matter of economies of scale caused by the high fixed costs. A simple extension of this concept explains why protecting trains and subways is orders of magnitude more difficult and costly. There are 428 subway stations in New York City. That compared to 579 airports in the entire US that are certificated for Part 139 passenger service.

I don't have a magic solution to this problem. Providing any sort of minimal air travel opportunities outside coastal population centers will necessitate some disproportionate spending on rural areas. Protecting New York's subways (not to mention the rest of the nation's railways to the same standards would require an incredible amount of spending. But then, if you don't protect the Amtrak train coming into the city from the rural areas, you're back to the same problem.

It's not a pleasant set of circumstances. And I'll admit that the current allocation is probably not optimal, so additional discussion on this topic is warranted. As situations change, so too our Homeland Security spending priorities must adapt. However, I would refrain from simplistic comparisons of per capita spending without a nod to the economies of scale that come with protecting population centers.

I suppose that in the '30s there were some city folks who objected to spending all that money on rural electrification. But the REA and TVA were meant to address similar economies of scale problems. Cities had electricity because there were lots of customers per mile of wire (and cost depends largely on distance). Rural areas had fewer customers per mile. Now, the good folks in rural areas have electricity, cable, and high-speed Internet--just like Ms. Vowell in her Flatiron apartment. (And that's great because it means you can read my blog whether you are in Cheyenne or Manhattan.)

Today's problems and priorities are different, but there are some principles that one would do well to keep in mind when thinking about these things.