Capper, over at his new home, is going after the Bush Administration and the EPA for the way in which they calculate the value of life:

Instead, economists calculate the value based on what people are willing to pay to avoid certain risks, and on how much extra employers pay their workers to take on additional risks. Most of the data is drawn from payroll statistics; some comes from opinion surveys. According to the EPA, people shouldn't think of the number as a price tag on a life.

Capper's take on it is this:

The news is now, you're worth even less to the government. According to the article, a person's worth has dropped by some 11%, or $1 million, in the last five years.

The drop in your life's value though isn't about the dollar losing it's value. Not at all. Instead, it's based on the Bush administration's efforts to relax EPA rules and help his Big Business buddies increase their already extravagant profit margins.

No surprise there.  And while this type of calculus regarding the value of life is harsh, it's probably a necessary evil when we have a large bloated government.  But let's look at the methodology here.  Does it make sense to calculate life based on your willingness to take risk, vs. your earning capacity (which is the other standard way)?  For the purpose of regulation and planning by the government, I'd say yes.  And here's why.

By using your willingness to pay to avoid risk as a measure, you are providing a useful, and very important, feedback loop into the system of regulation.  As the nation becomes safer, through various means, people generally become less risk adverse.  We might drive more because cars are safer.  Some people may have avoided flying previously because of the danger which largely now no longer exists.  The types of risks which we now might pay to avoid are actually becoming fewer as time goes on, as are their potential danger, and their chance of actually happening.

Would you be willing to personally pay $500 a month to avoid a 1/100 quadrillion chance of being hit by an asteroid?  Probably not.  Would you be willing to pay $10 a month to avoid harmful bacteria in your drinking water?  Absolutely.  The point is that regulation is not an absolute good.  It comes at a cost.  If it weren't prohibitively expensive, we might all be drinking distilled water from the tap, as opposed to water that contains certain minerals, trace elements, etc.  There's nothing wrong with that.

The fact that the value of our lives has gone down with this calculus doesn't mean that we're less valuable to society.  It means that current regulation makes us feel safe enough where we don't want to spend any more to prevent other things, instead of having that money for ourselves.  That's a good thing.