Dignity as a value in agency cost-benefit analysis.

AuthorBayefsky, Rachel
PositionIntroduction through III. The Existing Terrain, p. 1732-1764

NOTE CONTENTS INTRODUCTION I. COST-BENEFIT ANALYSIS: HISTORICAL AND THEORETICAL CONTEXT A. The Theory of CBA 1. The Traditional Understanding of CBA 2. Alternative Understandings of CBA B. CBA in U.S. Executive Agencies II. OPTIONS FOR INCORPORATING DIGNITY INTO CBA A. Option 1: Qualitative Balancing B. Option 2: Quantitative Balancing C. Option 3: Cost Monetization D. Option 4: Full Monetization E. Option 5: Trans-Contextual Monetization III. THE EXISTING TERRAIN A. Treatment of Dignity in Agency CBAs 1. Disability Rule 2. Prison Rape Rule 3. Air Toxics Rule 4. Health Privacy Rule 5. Age Discrimination Rule B. Conclusions Regarding Agencies' Consideration of Dignity in CBA 1. To Monetize or Not to Monetize? 2. Generality of Most Allusions to Dignity IV. RECOMMENDATIONS FOR INCORPORATING DIGNITY INTO CBA A. Against Monetization 1. The Complexity and Malleability of Dignity 2. Valuing Dignity in the Proper Way 3. Problems with Deriving a Trans-Contextual Monetary Measure of Dignity B. For Qualitative Specificity 1. Illustrating QS 2. Advantages of QS 3. Objections to QS and Replies a. Illegitimate Increase of Agency Discretion b. Distortion of Dignity CONCLUSION INTRODUCTION

On January 18, 2011, President Obama issued Executive Order 13,563, titled "Improving Regulation and Regulatory Review." (1) In this Order, the President affirmed cost-benefit analysis (CBA) as the appropriate method of determining the suitability of regulation by executive agencies. At the same time, President Obama's Order indicated that agencies, in conducting CBA, "may consider (and discuss qualitatively) values that are difficult or impossible to quantify, including equity, human dignity, fairness, and distributive impacts." (2) Of these benefits, "human dignity" is the major addition to previous Executive Orders. (3)

The inclusion of human dignity among the factors that agencies are authorized to consider in CBA leads to difficult questions. CBA frequently features strenuous attempts to attach dollar values to the advantages and disadvantages of regulation. (4) Yet dignity is often viewed as a quintessential example of a value impervious to monetization. (5) How, then, could dignity possibly be incorporated into CBA?

In fact, the mention of dignity in E.O. 13,563 received a fair amount of skepticism. Some proponents of CBA criticized the addition of human dignity" to E.O. 13,563 on the basis that incorporating dignity into CBA would permit agencies to pursue costly regulations simply because they advanced the "fudge factor" of dignity. (6) The Wall Street Journal editorialized that "a rule might pass Mr. Obama's cost-benefit test if it imposes $999 billion in hard costs but supposedly results in a $1 trillion increase in human dignity whatever that means in bureaucratic practice." (7) On this view, introducing dignity into CBA weakens CBA's capacity to assess accurately the positive and negative aspects of regulation--and, in particular, to constrain government to regulate only when doing so would produce net social gain.

Individuals opposed to CBA, for their part, have long contended that CBA is doomed to failure by its inability to take proper account of dignity and other unmonetizable" values. CBA critic Frank Ackerman, for instance, writes that [c]ost-benefit analysis fails because it assigns prices to the dignity of human life and the natural world." (8) According to this perspective, CBA cannot present an accurate portrait of the advantages and disadvantages of regulation precisely because it attempts to monetize values that cannot be priced, including dignity.

Both supporters and opponents of CBA have thus expressed the view that dignity and CBA fundamentally do not mix. Yet American agencies are now authorized to embark on the project of mixing them. Looming large are the questions of whether this project is justified and, if so, how it should be implemented and which values are at stake in its implementation.

This Note tackles these questions regarding the relationship between dignity and CBA as follows. The Note emphasizes the importance of taking dignity into consideration as part of an assessment of the positive and negative consequences of regulation. Given that agencies are evaluating the costs and benefits of regulation, they should include dignity in this evaluation at least in certain contexts (below I discuss the contexts of prison rape, disability, and age discrimination, among others). However, incorporating dignity into CBA requires a particular conception of CBA. Traditionally, CBA has been presented as a mechanism for the conversion of regulatory effects into monetary values However, alternative models of CBA exist. For example, Richard Hahn and Cass Sunstein have proposed a version of CBA that does not require monetization. (9) I argue that their model moves in the right direction, although it contains tension between the drive to monetize and the recognition of monetization's limits. The same uneasy coexistence of accommodation for unmonetized values and emphasis on monetization is found in official government guidance on CBA.

The Note builds on alternative conceptions of CBA and urges agencies to adopt a model I call qualitative specificity. According to the Note, regulators should not try to monetize dignity or provide an approximate monetary measure of dignity. (10) Instead, they should clarify, in qualitative terms, the nature and gravity of the dignitary values at stake in a particular regulatory context. I contend that qualitative specificity represents an improvement on existing agency CBAs. Qualitative specificity enables agency transparency about the features of dignitary value and their significance, and it facilitates broader participation in the decision-making process regarding regulation affecting dignity.

Part I characterizes divergent theoretical and historical conceptions of CBA. Parts II and III explore the relationship between dignity and CBA--from both a theoretical and a practical standpoint--at a level of detail not generally found in current literature. (11) Part II clarifies the relationship between dignity and CBA by providing a framework of options for incorporating dignity into various types of assessment of the positive and negative aspects of regulation. Whether these types of assessment count as CBA depends on the conception of CBA at issue In clarifying the relationship between dignity and CBA, Part II elucidates possible choices that government regulators can make in response to E.O. 13*563, thereby facilitating more self-conscious decisions about the incorporation of dignity into CBA. Drawing on the framework provided in Part II, Part III reviews agency references to dignity in existing CBAs. I note that existing agency references to dignity diverge in the extent to which they monetize dignity. I argue for the importance of greater self-consciousness about the choice whether to monetize dignity, in addition to further specificity about the dignitary effects of regulation.

One response to the problem of incorporating dignity into CBA is to monetize dignity, or to approximate monetization to the greatest extent possible. In Part IV, however, I argue against monetization. One of the reasons is that the attempt to monetize dignity, or to provide an approximate monetary measure of dignity, fails to reflect dignity's incommensurability with money. (12) Second, the complexity and malleability of dignity place serious roadblocks in front of monetization. Third, regulators faced with a monetized value for dignity may seek to derive a trans-contextual measure of dignity. Such a measure of dignity would be at odds with dignity's highly contextual nature. More broadly, the impulse behind monetization seems to be to constrain government discretion, but monetization in the context of dignity would appear to produce relatively opaque numbers.

After arguing against the attempt to monetize dignity, I propose and defend an approach I call "qualitative specificity." The term "dignity" has many meanings. Dignity could be perceived, for example, in terms of a status of equality; (13) a feature of individuals with autonomy; (14) or an element of basic humanity violated, say, by torture. (15) Dignitary harm, in turn, can take on multiple forms: for instance,

loss of reputation in the eyes of others; psychological feelings of humiliation; exposure of intimate details; loss of control over one's surroundings; lowering to a diminished status; exclusion from a group; or being treated as a "mere means" instead of an end in itself.

Given the diverse possibilities involved in conceptualizing dignity, agencies pursuing qualitative specificity would identify the nature of the dignitary harm that a given regulation is meant to ameliorate. They would also weight this harm based on qualitative scales of intensity (unlikely to very likely; short-lived to long-lasting; moderate to severe). Importantly, agencies would not be required to lay down the appropriate sense of "dignity" on their own. Rather, agencies could draw on input from outside parties both before and during the notice-and-comment period and thereby gain access to the lived experience of those for whom dignity matters. The presentation of qualitative specificity in this Note builds on existing Office of Management and Budget (OMB) guidance to agencies regarding CBA, (16) but it provides a more nuanced understanding of the ways in which qualitative specificity could be achieved, and is less ambivalent about the appropriate role of qualitative methods. (17)

This Note contends that qualitative specificity has advantages over monetization along at least two dimensions. First, qualitative specificity more fully vindicates the value of dignity by acknowledging the concept's complexity instead of seeking to assign a clear-cut monetary value. Second, qualitative specificity has the democratic benefits of greater transparency and increased...

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