Among the most startling admissions was the fact the drone strike was authorized by a senior counter-terrorism official without any specific information about who was in the immediate area, which had merely been identified as a compound frequented by al-Qaida leaders.The theory guiding this policy seems to be to degrade al-Qaida through attrition, killing its senior and mid-level leaders , and thereby forcing - if not an organizational collapse - at least a defensive posture , where survival rather than launching attacks becomes al-Qaida's primary objective. No independent review of the policy appears to be undertaken to judge its effectiveness.
The Obama administration has acknowledged that it will pay compensation to the hostages families which reminds me of an argument I've previously made. My argument is that there are two approaches economics give us to make the parties to a transaction internalize the cost of negative externalities The first is a tax and the second an appeal to tort law. If for example we worry that drone strikes are killing innocent people and causing significant damage to their property we should either:
- Make the CIA (or whoever is conducting the strikes) pay a large fine, in the form of compensation at say one or ten million dollars, for each civilian killed. It can't be a trivial sum or it becomes nothing more than a nuisance cost. The cost should also be big enough that it's noticed in the departmental budget.
- Give the victims standing in US courts to sue.