"The Value of a Human Life is About $10 Million"
Immigrant workers and the coercive foundations of our economy
(I’m Henry Snow, and you’re reading Another Way.)
The most popular economics textbook in America, Harvard economist Greg Mankiw’s Principles of Economics, puts a price on human life. In a case study in chapter 11 concerning cost-benefit analysis of traffic lights, Mankiw asks “how much is a life worth?” He insisted the answer could not be that life is priceless, because this would imply “nonsensical results,” like having traffic lights everywhere, or everyone driving cars with expensive safety features. Humans clearly are “at times willing to risk our lives to save some money,” and thus we need a price. By examining “the risks that people are voluntarily willing to take” and the pay they get for doing so, economists could produce one. “Studies using this approach,” Mankiw explained, “conclude that the value of a human life is about $10 million.”
Let’s take a minute to think about the industry he’s using as an example there: among the specific risks Mankiw mentions is the risk workers “voluntarily” assume working in the construction industry. While the book was originally published in 1988, the version I’m working from here dates from the long 00s housing boom. Between late 2001 and April 2005, over 2 in 5 new private sector jobs were directly related to housing– construction, renovation, or housing sales and finance. But despite the industry’s economic significance, residential construction workers saw little benefit: real wages in residential construction remained flat. It was the least unionized sector of the construction industry, with jobs worked by a growing share of undocumented immigrants. Their increasing prominence in construction labor was a result of wage decreases, not a cause of it, but the exploitative politics of American immigration helped lock in low wages for undocumented workers.
In April 2000, a construction worker named Gorgonio Balbuena fell from a ramp and suffered severe head trauma. He sued his employer and the realty company that owned the site for violating New York state law regarding construction site safety. In a related case, another worker named Stanislaw Majlinger fell 15 feet when a scaffold collapsed; he sued as well. During the discovery phase of their lawsuits, Balbuena and Majlinger’s employers determined formally what they likely already suspected– the men were undocumented. The defendants in the resulting cases argued that federal law prohibited the state from awarding the two lost wages, since they were not authorized to work in the United States. The court ultimately ruled otherwise– nearly six years after Balbuena’s fall.
Consider what had to go right for Balbuena and Majlinger’s victory: they had to be in a jurisdiction with meaningful labor protections, they had to suffer injuries that obviously were a violation of those state labor laws, they had to make the risky decision to sue their employers, and they had to actually win the case. A union could have proactively kept them safer in the first place– but they did not have one. If they had tried to organize their workplaces, their employers could easily have fired them. This is exactly what happened to Jose Castro when he tried to unionize the Hoffman Plastics Compounds plant he worked at– he was fired, and in 2002 the US Supreme Court ruled that undocumented workers could not receive remedies under the National Labor Relations Act.
Popular economic thinking in the 2000s, as earlier, justifies this system as ethical on the basis that it was voluntary. Right-wing opposition to the National Labor Relations Act and unions more generally presents organized labor as a violation of workers’ right to freely choose. But construction workers do not take a risky job because they put a low financial value on their lives. Undocumented workers like (I’m pulling from a few anonymized sources in news reports and law firms’ websites here, so while these aren’t hypothetical I don’t have names for you) the 40-year-old worker originally from El Salvador, who fractured his spine when he fell through a hole in a family home he was working in, and the 36 year old Ecuadorian worker crushed beneath 600 pounds of collapsing trusses in, and the 33-year-old Mexican plumber “scalded by an exploding pipe” at a construction site on Wall Street likely did these jobs because they had few better options to take care of their families.
Rising anti-immigrant sentiment across liberal democracies casts immigrants as thieves, parasites, outsiders draining limited wealth from the all-too-generous social safety net. Nothing could be further from the truth. Immigrant workers bear some of the greatest economic coercion, reaping little reward while contributing immensely to the countries they live in. The housing boom of the 2000s was built on the backs of people like those I just mentioned.
Greg Mankiw believed that his approach indicated “what value people put on their own lives.” In fact, it ascertained the value people are forced to put on their own lives. This is what labor markets do: they force us to make hard choices from a limited set of options. We all know this. There are things you have (or if you’re young enough, things you will) given up because of market competition. Dreams of a career, hours in your day to a commute.
Proponents of a market society argue that market competition is the best way for human beings to make economic decisions together. When we aggregate countless decisions– your choice of what stock to invest in, whether to buy a new car, which career is worth it, when to buy a house– together we decide how the world should look. This system works well enough for consumers, which is why proponents so often imagine this from the buyer’s perspective: behold, you vote with your dollars and your desires are made real!
But most of us aren’t just consumers— we’re workers too. For a price, you can have most things you might want— but your ability to pay that price only relies on you selling hours, days, years of your life, under conditions you don’t get much of a say in. The vague whims— not the intentions— of others, scaled by how much money they have, shape what’s possible in your life. For centuries, we’ve tried to imagine other ways, sometimes with partial success and sometimes with failure.
That isn’t an easy task, but it starts with being honest about how this system works (which is why my upcoming book Control Science deconstructs arguments like Mankiw’s). You don’t need to be at the barrel of a gun to be forced to make a decision. Economic coercion is coercion too. And while the most vulnerable face the most of it, as long as coercion is a pillar of our economy, whoever has the least economic and political power is going to be forced to price their lives.