Free To Choose To Defeat Terrorists...

We did. On November 2, 2004. At least that would seem to be the opinion of Prof. Andrew Samwick if one follows this slide show to its conclusion:

In the face of a new type of threat, what does
economics have to say about how we proceed?

First, identify the aspects of the pre-9/11 world
whose relative prices have gone up:

Congestion
Anonymity

Second, find and implement ways to use less of
those aspects in the post-9/11 world.

Congestion

Economies of scale often dictate that large networks are
efficient.

Tall buildings, interstate highways, transportation and
communication hubs

That same efficiency now makes them vulnerable as
targets.

Spreading out our people and assets and adding some
redundancies to our networks would lower the
effectiveness of weapons of mass destruction.

Anonymity

This has historically been one of the best
protections of the Invisible Hand.

It now allows terrorists to strike without fear of
reprisal.

In the future, we will need to increase our
collection of real-time data and develop stringent
privacy standards for how it is handled.

Capitalism and Freedom

From where do the new threats emerge?

Certainly not free-market democracies.

In all cases, nations in which political and economic
(and religious) powers are under tight authoritarian
control.

Our foreign policy must consistently promote
these freedoms.

Constitutions beat homelands.

Additionally, the FLUBA Self-Esteem Committee reports that it is very, very, cool to discover that former economic advisers to the President of the United States read this blog.