[A]fter someone reports a "terrorist threat," the whole system is biased towards escalation and CYA instead of a more realistic threat assessment.
Watch how it happens. Someone sees something, so he says something. The person he says it to -- a policeman, a security guard, a flight attendant -- now faces a choice: ignore or escalate. Even though he may believe that it's a false alarm, it's not in his best interests to dismiss the threat. If he's wrong, it'll cost him his career. But if he escalates, he'll be praised for "doing his job" and the cost will be borne by others. So he escalates. And the person he escalates to also escalates, in a series of CYA decisions. And before we're done, innocent people have been arrested, airports have been evacuated, and hundreds of police hours have been wasted.
This story has been repeated endlessly, both in the U.S. and in other countries...
The comments are great, and I really like the way Jon puts it in the context of a feedback loop:
You're describing a positive feedback loop without any dampening, so that noise will dominate and mask any genuine signal. In economic terms, the cost of all error has been externalized, so there is no incentive to be accurate or minimize false positives; in fact error directly leads to additional positive reinforcement, resulting in news coverage, promotions, additional budget and fancy new gear.
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