A Symbiotic Relationship
With record high rates of crime there is still a large issue in urban regions over the United States. Economists have been tirelessly seeking new way to address this issue all the more viably with new models and techniques. In their exchanges about the financial matters of crime, Jan Brueckner and Gary Becker layout great monetary models that expand on issues like the ideal level of spending on police and detainment keeping in mind the end goal to counteract crime, and in addition how to separate those spending among neighborhoods in a city with varying earnings and rates of crime. When examining the factors that play into the occurrence of crime, a number of economists recognize that welfare indicators like income inequality, education, healthcare, and economic status are indeed causal factors in determining the likelihood and severity of crime in a given area. Yet the most influential works in the economics of crime, like Becker’s “Crime and Punishment” (1968), focus almost exclusively on analyzing the effects of increasing police and incarceration spending on crime rates, rather than the effects of changing these welfare-related factors. I argue that Brueckner’s and Becker’s primary optimal crime spending models fail to identify the significance of causal factors related to general welfare, like education and employment, in determining crime rates in urban areas. I argue that government spending on welfare factors, and more specifically on public education, would be more productive in decreasing long-term crime rates than short-term spending on police and incarceration facilities, and for this reason should be included in economic models on crime rates and optimal crime spending. Doing so would allow for policymakers to understand these economic relationships and then direct spending on crime reduction towards structural solutions and “positive incentives” within the existing policy frameworks for crime reduction.
Mass incarceration and militarized police forces have become major points of controversy in American public policy discussions on controlling crime in urban areas. In 2013, the United States held the highest incarceration rate in the globe, sitting at 716 prisoners per 100,000 citizens. Also in 2013, the United States was home to roughly 4.4 percent of the world’s population, yet housed around 22 percent of prisoners around the globe, with annual corrections costs in the United States totaling around $74 billion in 2007. The movement towards these outlandish numbers has been underway for decades. Since 1982, police protection spending has increased by 445% and incarceration rates have increased by 275% (Bureau of Justice Statistics, 2007). During the same time, crime rates have been steadily declining since peaking in the early 1990s. The United States continues to pour billions of dollars into the apprehension and incarceration of criminals every year, despite decreasing rates of crime. As for the prospect of these increased rates of spending resulting in the observed decreasing crime rates, the Justice Policy Institute pointed out in a 2012 report that “studies of federally‐funded police programs, specifically Community Oriented Policing Services (COPS), found that the program did not significantly contribute to the dramatic decrease in crime over the last 30 years” and that “there is no clear correlation between spending more on police and lower violent crime rates”, citing state-level data. It has become clear that having the federal government and state governments spend billions on militarized police forces and on maintaining the largest prison population in the world (all in the face of decreasing crime rates) is remarkably inefficient. This observation holds true even without taking into account the massive loss of social capital associated with the phenomenon of mass incarceration, especially when considering those who are most likely to be incarcerated under current criminal justice policies.
When examining incarceration rates in the United States, it is important to take a deeper look at who is being arrested, for what crimes, and for how long they will be serving time in prisons. It becomes obvious the problematic ways in which policing and sentencing is conducted in poor urban neighborhoods throughout the U.S. According to the Prison Policy Institute, 1 in 5 prisoners incarcerated in the United States is imprisoned for a drug-related offense. Arrest rates for drug-related crimes are heavily biased against people of color, as arrests of blacks compose around 31 percent of drug arrests in the United States while blacks only make up 13 percent of the American population. One of the primary points of controversy in arguments against the policies of militarized police forces and mass incarceration has been that excessively harsh penalties have been levied against those who are arrested and convicted for committing drug-related offenses, and that because of the demographics of drug-related crimes these excessive penalties are therefore racialized. The rise of privatized prisons since the 1980s is said to have played a role in the implementation of harsh drugs penalties in the U.S., as a steady flow of convicts is needed to maintain these facilities. In the time period between 2000 and 2010, the incarcerated population in private prisons doubled, and now consists of roughly 20 percent of federal prisoners (Bureau of Justice Statistics). The disproportionate effects of policing and sentencing policies on poor neighborhoods has also been a primary issue within the conversation of mass incarceration and policing, as poor neighborhoods are much more likely to experience higher crime rates, especially with non-violent and drug-related crimes. With an increased likelihood to commit crimes caused by economic reasons and networking effects comes a much higher likelihood for poor young adults to be arrested and incarcerated for these offenses. After being released from incarceration, these citizens then find it much more difficult to integrate back into society and make a sufficient living without reengaging in criminal activity due to numerous state and federal laws allowing for the disenfranchisement of ex-convicts and their exclusion from job opportunities. Thus, recidivism rates are high in the United States, with the National Institute on Justice citing a BJS study that reported a national recidivism rate of 76.6 percent within five years of release. These numbers on incarceration, combined with the observable negative social effects of police brutality and the incalculable losses of social capital associated with mass incarceration, paint an ugly picture for the effectiveness of the American criminal justice system.
The main problem with models related to the economics of crime is the disproportionate focus on modeling negative incentives, like deterrents and incarceration, rather than on factors related to crime rates that are more deeply entrenched in social inequity and are therefore more difficult to address for policymakers and economists alike. In failing to consider the effects of changing factors related to social welfare, models are not telling the entire story of how crime rates are affected by factors beyond spending on police patrols or legal deterrents. Brueckner acknowledges in his chapter on crime that an individual’s characteristics play into his or her ability to earn a legitimate income that surpasses the threshold of the constant criminal income in his “occupational choice” model (Brueckner 208-213). Brueckner outlines that these characteristics include levels of education, skills, and sociability. Yet in Brueckner’s later analysis, he fails to mention these determining factors in addressing the optimal social spending on crime reduction and prevention. When modeling the costs related to crime prevention with victim costs associated with criminal activity, Brueckner only looks at spending on police forces and prisons and how changes in these types of spending affect crime rates and therefore victim costs (Brueckner 214). Becker also utilizes a similar approach in his seminal “Crime and Punishment: An Economic Approach”, writing that the market supply of offenses is given by a “function relating the number of offenses by any person to his probability of conviction, to his punishment if convicted, and to other variables” (Becker 9). Of course the primary relationship outlined by these models is that the higher the likelihood of being arrested or the harsher the sentencing laws, then it becomes less likely that a prospective criminal will engage in these criminal activities. Similar studies that incorporate models consisting of variables related to incarceration and policing, which have since informed public policy decisions, have been published by economists like Steven Levitt, Isaac Ehrlich, Michael Davis, and Edward Glaeser.
Economic models presented by the works of Becker, Brueckner, and other economists have served to reinforce common sense ideas and attitudes on crime and punishment that have a deep historical background in American culture and policymaking. In basing their models solely around the idea that in order to most effectively address crime rates we need to find an optimal level of spending on the apprehension and punishment of criminals, these economists have given legitimacy to policymakers’ desires to implement the timeless American moralistic attitudes on crime and punishment into government policy. According to dominant American precepts, criminal activity is representative of an inherent moral defect, which can most effectively be addressed through swift and harsh punishment. We have seen these conservative attitudes on display with the rise of Nixon’s “Silent Majority” and the New Right in the 1970s and 80s, coinciding with the commencement of the War on Drugs in 1970 and Reagan’s notorious anti-drug enforcement and sentencing policies. These models have logically served as part of the basis for criminal justice policies stemming from these political movements. The policies resulting have created the system of mass incarceration and the trend in excessive spending on militarized police forces that we see today, justified by decreasing crime rates across the board. Efforts to focus crime prevention on increasing social welfare or by engaging in community efforts have failed to take root in American criminal justice policy as a result of the dominant thought patterns on crime and punishment reinforced by economic models that also fail to take into account the wide-reaching social inputs of urban crime. In order to see a shift in policy objectives on policing and incarceration, there then needs to be a change in the basic considerations of economic models that determine how to allocate government resources in dealing with urban crime rates.
As Jeffrey Fagan and Richard Freeman point out in “Crime and Work” (1999), crime rates and expected wages are inversely related. Expected wages are believed to be a rough composition of job skills, education levels, and social abilities, and Brueckner elaborates that when these individual characteristics are at a high enough level then legitimate income earning opportunities are the clear rational choice for wage-seekers. Then it would follow logically that government spending towards increasing the ability of those most susceptible to exposure to criminal activity by “neighborhood effects” to achieve a legitimate income would be money well-spent, depending on the marginal effectiveness of that spending. An obvious initial policy proposal would be general spending shifts away from incarceration and excessive police spending towards general welfare spending. These categories of spending could include items ranging from infrastructure, housing, and healthcare, to food programs and education. I’d like to devote a separate section to the category of education, but will address these other listed spending proposals as a general welfare initiative that contains interchangeable parts, despite research suggesting differing levels of effectiveness in increasing incomes among different types of government spending. This type of government spending, as opposed to incarceration and police spending, will be more likely to generate long-term economic benefits that in turn will reduce crime rates in poor urban areas. Brueckner presents the case of a city increasing its overall wealth in his legitimate and criminal income model, arguing that an increase in overall wealth will result in higher crime rates due to the effect of increased loot available for criminals to take advantage of, holding factors like police force size and punishments constant. However, increasing the availability of resources for low-income neighborhoods to survive and advance affects families’ income indirectly, and allows families opportunities to pull themselves out of the cycle of poverty that breeds high crime rates. Measures like these would also have to be combined with lessened sentencing laws on non-violent offenses, as will be discussed later on, as well as new approaches to policing urban communities, in order to dampen the loss of social capital in poor neighborhoods associated with locking up millions of young adults for minor offenses. However, implementing new practices of arresting and sentencing would be trampled by the well-documented networking effects of crime within poor neighborhoods without structural improvements to the welfare of these neighborhoods.
The economic and social benefits of increasing spending on public education are already well-documented, as virtually all economically advanced countries in the world have pursued public education initiatives at varying degrees. A Penn State study conducted by Dana Mitra found that decreasing the number of high school dropouts in the United States by half would generate roughly 45 billion dollars in social and economic benefits to society each year. Mitra’s study also goes on to address specific statistics relating to crime and education, citing that 41 percent of all prisoners have not completed high school, and that a five percent increase in the male graduate rate in the U.S. would save five billion dollars in annual crime-related expenses. I propose that increasing government spending in public education is one of the most fundamental and effective ways in which the government can address the problem of crime rates in poor urban neighborhoods. According to Mitra, the annual cost of incarcerating an individual is around 32,000 dollars, while the cost of providing a quality education in a public school system is roughly 11,000 dollars, or about one-third the cost of incarceration. Not only is policing and incarcerating individuals on a mass scale ineffective at reducing the networking effects of crime and keeping convicts from committing further crimes upon release, it is also significantly less cost-effective than education spending, which produces countless other positive externalities outside of the realm of crime prevention. Incorporating education spending into criminal justice spending models similar to those presented by Brueckner and Becker would involve creating a variable for this type of spending into the formula for the market supply of criminal offenses, and then implementing that variable into the model of how to allocate spending as to reduce the total amount of crime within a given area. Higher levels of education among a city’s residents would also raise the ability of a city’s residents to achieve a higher legitimate income in Brueckner’s legitimate and criminal income model, and with a focused approach on spending would be able to do so without shifting the criminal income upwards with it.
Many studies on the economics of crime have focused on the deterrence effect of harsher penalties and sentencing laws in reducing crime rates in the United States. Steven Levitt’s 1998 study attempted to differentiate the relationship between lower crime rates and the effects of incapacitation, deterrence, and possible measurement errors associated with crime data reporting. Levitt’s study found that the effect of deterrence was the primary means of lowering crime within the context of traditional crime models, such as those presented by Becker and Brueckner, rather than measurement error or the direct effects of keeping likely criminals incarcerated. Isaac Ehrlich’s 1996 crime study agrees with this finding, adding that there may not be a need to rely exclusively on harsh sentencing laws to achieve efficient crime reduction measures with the effects of deterrence. However, these models fail to integrate the possibility that incarceration could be used in the United States to rehabilitate prisoners rather than to serve primarily as a deterrent to crime. Take the example of Norway, which has incorporated the concept of “restorative justice” into its sentencing laws and prison systems. In 2014, Norway held 4,000 of its roughly five million citizens incarcerated, which is expressed as an incarceration rate of 75 per 100,000 people (compare to U.S. rate of 716 per 100,000 citizens). On top of the extraordinarily low incarceration and crime rates, Norway experiences around a 20 percent recidivism rate (Deady 3) compared to the 76.6 percent recidivism rate in the United States. From these massive differences in numbers it becomes clear that the harsh approach to incarceration taken in the United States may not be as effective as approaches centered around rehabilitation taken in other developed nations, despite past evidence in favor of the deterrence effect on crime in the U.S. These statistical differences could also be a result of other socioeconomic factors that are treated differently by the two governments, like previously discussed approaches to general social welfare and education. However, the massive differences in recidivism rates would logically suggest that the radically different approach to punishment and ex-convict laws in Norway is more successful at keeping ex-convicts from recidivism than the American approach. The largest challenge in implementing such an incarceration system in the U.S. would be a political one, as this approach to crime and punishment flies in the face of the dominant perspective on criminal justice in the U.S. On top of this battle, a criminal justice system like Norway’s defies the “lynchpin” of Becker and Brueckner’s models, which argues that harsher sentencing laws and their subsequent deterrent effects are the most effective drivers of lower urban crime rates. As such, incorporating the Scandinavian approach into these traditional models would be irrational.
In order to address the inefficiencies surrounding policing efforts and high arrest rates in poor urban neighborhoods, the manner in which the police pursue offenses based on established legal statutes needs to be adjusted. According to the Justice Policy Institute, this process would begin with policymakers moving towards less harsh punishments and a directive for police to prioritize giving citations over making arrests for minor offenses, such as certain drug-related offenses. In order to fundamentally change the way policing is performed in poor neighborhoods, the Justice Policy Institute also recommends moving towards a practice of “community-based policing”, which the U.S. Department of Justice defines as “a philosophy that promotes organizational strategies, which support the systematic use of partnerships and problem solving techniques, to proactively address the immediate conditions that give rise to public safety issues, such as crime, social disorder, and fear of crime”. This policy shift would divert funds from the militarization of urban police forces towards other means of reducing crime outlined earlier, and would serve to reduce the high rates of violence and misconduct complaints currently reported with police operations in poor urban neighborhoods. Such a shift would not necessarily affect the deterrence variable in traditional crime models, as a partnership between a local police force and a poor urban neighborhood would serve to increase compliance in keeping the police force informed, which in turn discourages criminal behavior and would maintain or increase the likelihood of arrest within a given neighborhood. If this were the case, then increased police spending would become less effective rapidly, as the structure of community-based policing would reach a relative maximum efficiency more quickly than the current structure of militarized, zero-tolerance police practices. In order to adjust for this in current models, the curve for crime prevention costs in Brueckner’s optimal spending model would shift downward to represent lower police force costs in preventing crime, and therefore a lower optimal level of crime and crime spending.
It is difficult to decide on which policy solution is most essential to implement into the current models that inform policy decisions on crime prevention in the United States, as most of these solutions are interdependent in one way or another. While it is essential to address the issues of mass incarceration and expensive militarized police forces through changes in sentencing laws and how police forces interact with poor urban communities, and while this may be the more attractive option for those fighting for increased civil liberties, I contend that addressing the most serious issues regarding crime is best accomplished by shifting government funding towards public education. Public education provides numerous positive social and economic externalities, including proven benefits in reducing crime related expenses (see Mitra study). A study by Moretti and Lochner suggests that anywhere up to 26 percent of the social benefit from high school education completion derives from positive externalities related to crime reduction. Education serves to permanently adjust the legitimate income curve of a given area higher by increasing the availability of work opportunities for those who receive a more advanced level of education, thus permanently reducing incentives for crime. It is important to first make these structural changes, like the outlined social welfare advancements, in order to effectively address urban crime rates. Focusing efforts on relaxing sentencing laws and shift policing strategies will prove ineffective without providing resources for families to break the cycles of poverties and escape the networking effects of crime in inner cities. As traditional crime models show, doing so will only lessen the costs of committing crime and increase incentives. When taking these policy proposals into account with the shifts in spending towards welfare measures and their subsequent reductions in crime rates, the traditional economic models of crime presented by Gary Becker, Jan Brueckner and others must be altered to account for crime reduction measures outside of police and incarceration spending.
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