What is a Human Life Worth?

Arif Ali/AFP/Getty Images

Arif Ali/AFP/Getty Images

How much is a human life worth? That’s not a question anyone ever wants to attempt to answer, yet it’s one that requires a response. Businesses and lawyers have had to take on that question in the past and will surely have to do it again at some point. For as long as enterprise has flourished on the free market, there have been defective products and accidents that have required a response — unfortunately, that has included the calculation of the value of people’s lives.

From simple beginnings, products and services have become more sophisticated, complex, and dangerous. And when products become so complicated or dangerous that they can kill people, they eventually will. Whether it’s due to manufacturer error or improper use, lawsuits and injury claims are bound to come pouring in at some point, and that’s when the hard calculations have to be made.

Perhaps the most famous and memorable instance of a major company having to actually come up with a hard number to assign to a person’s life was in the case of the Ford Pinto, a small car that was developed on an accelerated schedule in an attempt to capture the most market share in the least amount of time. Due to a design flaw, the Pinto could catch fire as a result of its faulty fuel system, which the company knew about but chose not to fix. Through risk/benefit analysis, the brass at Ford came to the conclusion that it would ultimately cost the company less to simply pay out the victims rather than go back and actually attempt to fix the problem.

Naturally, people were outraged. But the case of the Ford Pinto brings up a very serious question: Is it ethical or right for businesses or governments to actually crunch the numbers through a risk/benefit analysis to figure out their course of action, particularly when lives or injuries are at stake?

Shockingly enough, the Pinto situation would be relived in modern times, as recently as this year. Only this go-around, one of Ford’s chief cross-town rivals would be the culprit.

General Motors issued a recall in early 2014 — one of many, to be fair — that included 2.6 million small cars spanning several brands, many that were not even in production any more. It was found that these cars had a faulty ignition switch that could shut the vehicle off while driving down the road, causing a failure of the airbags and other safety measures. So far, 21 people are known to have been killed as a direct result of this defect, and GM is dealing with the consequences.

It appears that GM executives knew the problem existed and yet didn’t take any action to fix it. Similar to the Ford Pinto situation, the public outcry has been loud. GM has set up a fund to pay victim’s families, which is in the hundreds of millions of dollars. It will be some time before exact figures are known, but this is another example of a company putting profits before their customers’ lives. Surely no one at General Motors wanted anyone to die as a result, but at some point a call was made to ignore the issue in the name of savings.

What makes it especially hard to cope with is that the problem could have been dealt with for a very small cost — a mere $1 per vehicle.

Since GM effectively didn’t learn a lesson from Ford, it makes you wonder how many other companies engage in the same type of practices. Perhaps Ford and GM are getting battered especially hard by the media and public because their products have an inherent level of danger in their use to begin with. If you were using a faulty coffee table, it’s unlikely that you would die as a result of an overlooked defect, whereas in a car, the consequences are much more serious.

At the core of the matter is this: Is it ethical to whittle a person’s worth down to a simple dollar figure? From a corporate perspective, it appears so. Since a corporation itself is so gigantic in scope, few people, if any, actually feel that they need to take responsibility for issues. Simply pushing problems up the chain of command has seemingly become the preferred method of dealing with problems, and it can end up costing organizations greatly over time.

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Other industries have to literally take into account that their products will kill customers over time, and find ways to plan for it. The tobacco industry is the prime example, as they have not only added drugs to their products so customers become addicted, but also are fully aware that prolonged use can kill. Yet tobacco companies continue to make cigarettes and people continue to use them, albeit at steadily declining rates. Tobacco companies have even looked at the economic benefits of their products killing people at earlier ages, in an effort to defend themselves from lawsuits and from governments asking for money to help curb the costs of tobacco use on society.

So how do they do it? How do companies actually assign a given dollar amount to a person’s life?

A lot of it comes down to how much government agencies actually think a life is worth. For example, the EPA “uses estimates of how much people are willing to pay for small reductions in their risks of dying from adverse health conditions that may be caused by environmental pollution” and came up with $7.4 million. The FDA came up with the figure of $7.9 million, and the Transportation Department, $6 million. These figures were developed in order to justify regulations that businesses claim hamper growth.

The value of human life has also been determined by the courts in different situations, in the form of damages due.

So is it ethical for companies to assign a dollar figure to people’s lives and make business decisions based on that calculation? No, but it’s going to happen. Whether it’s the result of a plane crash, a failed fire suppression system, or faulty vehicle ignitions, companies and their lawyers will continue to wrestle with what it costs to pay for deaths. It’s not ideal, nor is it fun to discuss. The main difference, ethically speaking, is when companies actually have control and a chance to fix problems that could kill down the line.

It may end up costing a bit more in the long run, but it’s a smaller toll on production budgets than it is on public image or consumer reputation, which sometimes can’t or won’t be repaired.

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