What Is in a Number? (A Migratory Bird Equals a 70 Year-Old Lebanese. )

What is in a number? (A migratory bird equals a 70 year-old Lebanese. )

“ The overall cost of environmental degradation in Lebanon caused by the 2006 hostilities is estimated between US$527 and 931 million, averaging at US$729 million, or about 3.6% of GDP in 2006.”1

So declares the World Bank in its October 2007 report.

US$729 million.

What is in a number? The devil, though, is not only in the details; the devil is also in the process. The methodology used by the World Bank in this report resulted in an artificially low number.

What is the significance of examining the number and the process? It reminds us, again, of the importance of critical thinking, critical examination, and the danger of depending on outside reports.

Here are two, quite notable (but not all), problems in the report.

Oil Spill: When assessing the cost of the most infamous of environmental crimes committed against Lebanon – the Jiyeh oil spill – the WB estimated the “overall damage and clean-up cost due to the oil spill [at] conservatively US$203 million.” They got this figure by estimating the expected benefits had the oil spill not occurred and the costs of clean-up. What is missing?

What was the model in what is regarded by environmental economists themselves as an unavoidable reference: The Exxon Valdez Oil Spill in the Alaskan Gulf in 1989?

In determining the costs of that massive spill, the high level study commissioned did not simply use the direct costs and lost benefits of the oil spill, as the World Bank study did; they also quantified the loss of the nonuse values of U.S. residents of the affected ecosystem caused by the spill. Nonuse value attempt to determine people’s willingness to pay for a resource regardless of their ability to use the resource now or in the future. In other words, how much is a clean coast worth to residents in Lebanon or overseas who do not get their livelihoods from that coast but still want to hold on to the possibility that they could visit the coast sometime in their lifetime? A survey would be conducted to ask those individuals how much they would be willing to contribute to a fund to prevent a similar occurrence in the future.

Does that seem like abstract theory? The US Exxon Valdez Oil Spill study was headed by two Nobel laureates with a team of 22 other economists. More importantly, the US study’s assessment process led to the development of guidelines on the use of surveys in such events.

The big question is: why did the World Bank report not use this system of valuation, a system that has been used in oil spills since the 1989 Exxon Valdez disaster?

Without question, including this valuation, which is recognized in a court of law, would have dramatically increased the environmental cost of the Jiyeh oil spill, thus increasing the total value for which the Lebanese government could sue Israel.

The oil spill is not the only time in the report when what is used for the United States (and numerous other countries) is not applied to Lebanon.

1 Economic Assessment of Environmental Degradation due to July 2006 Hostilities. Document of the World Bank. October 11, 2007. Report No. 39787-LB Human life: How to determine the cost of early death and disease due to the cluster bombs and other unexploded ordnances from the Israeli war? How to give a numerical figure to human death and injuries?

As controversial as this question is, there are accepted economic methods. The World Bank didn’t use those methods. Rather, the World Bank used ‘creative’ methods. It combined two economically-accepted methods in a manner that was not based on solid economics. The estimated total damage cost of casualties from unexploded ordnances was found to be between US $14 million and 109 million over a period of two years.

In the report, the World Bank used US$23,650 as the Value of a Statistical Life per year of healthy life lost. In other words, it is the value you, as a healthy person, are hypothetically willing to pay to avoid the risk of dying early.

The number alone means quite little. Without delving into the complexities of the economic mechanisms used, the number gains its meaning in comparisons.

If we take the value used by the U.S. Environmental Protection Agency, and adjust it by the US/Lebanon GDP ratio, we find then that the value used in the WB report is only 14% of the equivalent figure for the U.S.! In other words, a healthy Lebanese is worth 14% of an equivalent healthy American.

But there’s more. According to the overly creative method devised in the report, the value associated with a 70-year victim of an unexploded ordnance is equivalent to the value of a migrating bird lost due to the oil spill – as used in the same report! Thus, stating it crudely, according to this WB report, one migratory bird equals one 70 year old Lebanese, and 7 Lebanese equal 1 American on average.

(If we use the value accepted by the US government, this method could be used to compensate for the individuals killed by the July 2006 war as 1200, then – setting aside all other costs of that Israeli/US war on Lebanon, the Lebanese government could legally sue Israel for US$ 1.14 billion – for the direct victims alone.)

In the midst of the rhetoric of “sovereignty” that has been flooding Lebanon for three years, critical thinking is desperately needed. If Lebanon wants to assert its sovereignty, even in the vein of calculating the costs of the latest Israeli/US war on its homes, farmland, and coastlines, the World Bank report cannot be used. Rather, new calculations, based on thorough, consistent methodologies, need to be determined, including compensation for the killed, wounded, and displaced. With this information, the Lebanese government – in whatever form it eventually takes – needs to sue Israel in court.

Back in 2006, the Associated Press reported that “Lebanon is preparing legal action to sue Israel for damages over a huge oil spill caused by Israeli bombing of a power station during the recent conflict. Lebanon would pursue the legal action against Israel on two levels, one at the International Court of Justice at The Hague and the second at the United Nations.”

As it stands now, the Lebanese government has yet to officially demand such a legal action – neither at the International Criminal Court, used to settle war crimes, nor at the International Court of Justice, used to settle the entire legal suit associated with the war.

Rather than holding Israel responsible for its crimes, the government prefers to seek additional aid, thus, as one economist explained, “increasingly limiting our independence and dictating our future alignments while giving Israel a blank check and a free hand to impose its ambitious regional policies. On the one hand, the additional loans needed for reconstruction and clean up will put more strain on the fragile Lebanese economy by increasing the debt/GDP ratio to new highs –already ranging between 175 to 200 percent and one of the highest in the world. On the other hand, the Athens, Stockholm, Paris or any other capital meeting pledges are Israel’s everlasting life insurance policy against its unaccountability in imposing its will through the spread of blood, displacement, destruction, confinement and environmental damage.” Put it in another word, as Dr. Norman Finkelstein explained so succinctly: if you beg for crumbs from the master’s table, you will be treated as the beggar that you are.

Then again, perhaps the government is waiting for the next Israel war on Lebanon before it claims the legitimate rights of the people.