Saturday, January 2, 2010

Airport Security

So there's a lot of new concern about airport security after the recent incident on the Amsterdam/Detroit flight Christmas Eve.

Here's what I don't get about airport security --- Why aren't we using the good ol' fashioned profit motive to try to improve things?

I'm not a "privatize all government services" kind of guy (as many readers know), but airport security seems to me to be something that's extremely privatizable (if that's a word).

Here's my quick and easy plan for fixing our nation's airports without forcing travelers to arrive four hours early for their flights.

1. Auction the right to perform airport security checks to private firms.

2. Make the payments to these private firms a function of how effectively they prevent prohibited materials from getting inside our airports.

3. And how do we measure whether they're doing a good job? Have the government employ a staff of auditors. And what do the auditors do? They try to smuggle stuff into airports. That's right... government agents with liquids zipped into their underwear trying to get through security checkpoints. Every time the private firm stops a government agent... Boom $10,000, straight to bottom line.

I see a few problems with this system --- specifically, some ratchet effect issues once the security firms get really good at detecting liquids in somebody's shorts, and also some potential issues with getting the security agents to actually be nice to people. But in the meantime , don't you think that having money-motivated security agents would make our air travel safer?

Thoughts?

15 comments:

Thad Hall said...

And, every time they fail, could they pay $10,000 to the government?

Scott Schaefer said...

This is why you auction the rights in the first place. The bidders would pay more when they expected to catch more of the auditors. Hence, a failure to catch the auditors would mean they aren't recouping their up-front payment. So, it's as if they lose money when they don't catch people.

Steven Ting said...

But every time something is detected, wouldn't that shut down the security lane? In the few instances I've seen at the airport, when there is a serious problem (guns, ammo, explosive found) the lane is shut down for about 30 to 60 minutes. That creates an additional inconvenience.

Plus, every time a tester is caught, other agencies are notified like the airport police, FBI, US Attorney. This can build complacency if people think it's just a drill.

How about we go back to good ol' profiling. The police do it. TSA should do some form of it. Here's a small rant from a friend.

"If there is a type of crime you want to stop, you develop a profile of those that are committing the crimes. You look for those people who look like, have backgrounds like those that have been committing the crimes not based on Race.... but based on a lot of factors that Race only plays a small part of. If you want to catch Hells Angels Gang Members, you don't just look at everyone on a Motorcycle. You look for other signs. Big White Guys is a part, but there are other things such as black leather clothes, tattoos, facial hair, Harley's, and the big kicker, the big emblazoned “Hells Angels” on the back of their jackets. What the government is doing is basically saying you can't look for the Hells Angles banners – we have to look at everyone on a Bike. Because just stopping guys that have Hells Angels on their backs isn't Fair. Look, profiling works. Simple as that. Cops do it All The Time, even if they don't think they are. This is how they get all the drug busts on simple traffic stops... the cops profile and look for the signs. That's how they do their job."

Or we could go the opposite route and have consumers pay. Those that don't want to wait 4 hours can pay a fee for faster service. They used to have the FlyClear service, but is no longer in operation. Good concept, just never caught on.

Scott Schaefer said...

I think there are ways around the shutdown problem. Once the security agents identify a banned item in an audit, the person who is trying to smuggle it simply says a code word... The security agents then know not to call police. Plus you can vary how often audits are done. If 10 audits a week is too many (and each pays $10,000) to the security firm, then do one audit a week and pay $100,000.

Steven Ting said...

With almost 600 major US Airports (About 19000 total airports, public and private), 1 audit per week might be doable. But, I think another problem is then created with the code words. You have an abundance of code words as they have to be reset after each instance and each location needs to have a different codeword. That means possibly 30,000 codewords over a year.

And all of this would be in addition to the real instances.

Plus, larger, higher traffic airports like Atlanta should have more audits than smaller airports like Sun Valley.

I don't think there is one catch-all answer to this problem.

Daniel said...

Wouldn't there be a profit-maximization problem? There is eventually some point where it costs $10,001 to catch an extra auditor worth $10,000. The public demands airport security to be 100% effective, yet the profit-maximizing point may be 99%. If the undetected 1% leads to some disaster, the private bidder could likely face immense legal ramifications.

Steven's point on profiling reminded me of this recent article on "Israelification" of airports:

http://www.thestar.com/iphone/news/world/article/744199---israelification-high-security-little-bother

This seems to be working quite well for Israel.

Jeff H said...

Daniel … Great article on Iraelification.

Two issues this discussion hasn't covered yet: 1) the balance between security and privacy, and 2) to whom security officials should really be accountable.

Privatizing airport security as proposed would tilt the balance between security and privacy even more than in the current system. Private firms, interested in maximizing profit, would be driven to increase security at the expense of privacy. And because the government, not the consumer is paying these firms, there's little choice for the consumer but to accept reduced privacy.

There's an opportunity here. Instead of having governments and private security agencies make the choice of how much security is adequate, let the consumer decide how much security he/she is willing to put up with and, here's the key, how much he/she is willing to pay for.

Each flight could come with a predetermined security level: basic security $5, premium security $15, invasive security $30. Consumers could book the flight that balances security and privacy as they desire. If you choose to pay more for a flight with an invasive security package, you can fly with confidence knowing everyone else on your flight also underwent the same invasive security clearance.

Three lines at the airport could represent the three security levels. Your boarding pass would indicate the security level required by the flight you booked.

When traveler's fear heightens, like it is now with the over dramatic news coverage of the Detroit incident, more people would buy flights requiring premium and invasive security clearance. Those more rational passengers who know there is a 1 in 20,000 chance of dying in an airplane crash, compared with 1 in 100 in a car crash (LA Times), could fly on a basic security flight and avoid an unnecessary body groping or visual strip search.

I vote for taking the power from the bureaucracy and giving it to the consumer.

Anonymous said...

Privatize national security?

Steven Ting said...

@Jeff,

I'm not sure if I understand your concept. It seems flawed. So there are 3 lines where people can choose how much security they go through? Doesn't make sense. A plane is a plane and has one cabin. Whether someone went through basic security or the uber security, everyone has the same risk on the plane. And just because a consumer chose to pay less for the basic security, why do the pilots and crew need to be exposed to the same risk?

Also, as far as pricing goes, I think you have it backward. Those that want the uber security should pay less, while those wanting the faster, basic security, should pay more.

But the other problem is, once someone clears security, they are free to mingle with others in the terminal. So, I would expect a BG to try and go through basic security.

Jeff H said...

@Steven,

I mentioned the security level is tied to the flight: "predetermined security level". For example, when I book my flight to say, San Fransisco, I would have a choice between basic security flights, premium security flights, and invasive security flights. If I book a basic security flight, then I pay airfare plus $5, and I know everyone else booking that flight is also going through basic security. Passengers going through different security levels are not mixed on the same flight. If I choose a flight rated at invasive security, then I pay airfare plus $30, and I know that everyone else booking that flight is also paying the same and going through invasive security.

And the pricing isn't backward. We are not selling convenience. We are selling security. Those who want increased security are the ones who will pay for it.

This is consistent with the marginal cost of screening passengers: generally, the more intense the security screening, the higher the cost of screening passengers.

Steven Ting said...

While marginal cost/benefit are all correct, it puts a large burden on the airline. For this to work, we would have to get rid of some of the features of airlines.

For example, it would be difficult to implement your solution when we have connecting flights. Airlines would not be able to rebook you on another flight if you missed it or were delayed. Different security level flights places an undue burden on the airline industry.

Plus, what is to stop someone that bought basic security to switch their boarding pass with someone that bought uber security? Right now, that's a currently flaw because once we go through security, we do not check/verify identity before boarding the plane.

Jeff H said...

@Steve ...

True True. Let's be honest, I came up with that skeleton of an idea in about two minutes. I'm sure there are many more flaws than what you just mentioned.

But what do you think about the idea of changing the accountability of the security agency, whether private or government, from the government to the consumers? (This is really the heart of my post.)

Right now, if I'm not happy with security, my recourse is to write my congressman or not fly. The latter isn't always an option when many passenger's decision to fly is inelastic, i.e. business travel, family obligations ... and if you want to visit Hawaii, a 30-day slow boat just doesn't compete with a six-hour flight.

So we either surrender our privacy by accepting increasingly invasive (and only marginally more effective) security screening or surrender our freedom to travel about our country by air. Neither option seems satisfactory.

Unknown said...

I like the idea, but I wonder, shouldn't TSA being auditing themselves now? (I'm certain they are)

I am not certain they are trained to think like terrorists. How creative are the auditors - government or TSA (synonymous) in attempting to smuggle items onto airplanes?

Additionally, I would be alright to reduce my rights to privacy for the privilege to participate in the miracle of flight - safely of course.

http://www.youtube.com/watch?v=8r1CZTLk-Gk&feature=related

Nick

Scott Schaefer said...

Wow, a new record for comments! Awesome!

Alan said...

I can't add much to the talk about airports, but since we are talking about privatizing security at airports, how about discussion on making cell phone towers part of government controlled infrastructure?

It seems silly to me that we have several major carriers and all of them have weaknesses in their networks. Why not combine the resources all to make one killer network?

Also, look at Europe. They are years ahead of us when it comes to cell phones. They also have much less ground to cover. Here we are not even trying to cover all the our ground, but trying to cover each area multiple times and doing an excellent job covering nothing.

Just some thoughts for a potential blog post.