Crime and Economics

Do criminals made economic analysis of their crimes?  Do they weigh the value of the crime versus the risk of being caught - and the punishment?  You bet they do!

As I noted in an earlier post, the mind is an incredibly complex neural network, capable of solving very complex problems.  And although people may claim they cannot do fractions or geometry or algebra or calculus, their brains solve problems of that order at a level that is far below the conscious.

And this is true in all daily activities, whether you are evaluating the price of butter at the store or buying a used car.  If someone can skew your brain with false values - usually through emotional cues - they can get you to do things against your own best interests, of course.  They can reprogram your brain.   But what is amazing is that in many cases, people do seek out and get some good deals, although they are often quite perverse, if viewed in the abstract.

And nowhere is this more true than in the world of crime.  To many, crime is an irrational act, which makes no sense and is unprofitable as well.  And to some extent, this is true.   Many crimes are acts of passion - emotionally based responses - that provide no gain to the criminal.  Getting into a bar fight, assaulting your wife, vandalizing things - these are crimes that are emotionally driven and do no good for anyone involved.  The neural network is overwhelmed by irrational, emotional cues.

Although one could argue that the emotional payout is what the criminal is looking for, half the time.    Teenagers, for example, will commit what appear to be senseless crimes - vandalizing things, spray painting graffiti, and even beating homeless men to death with baseball bats.*  What gain is there in any of that?

And the answer is, of course, the adrenaline rush of committing a crime.  For bored suburban white kids, raised on TeeVee violence and video games, their "real life" seems pretty boring.  Doing a Social Studies report just doesn't cut it, when they have seen, on television, hundreds of thousands of violent crimes over their lifetimes - and literally killed thousands themselves, in violent video games.

So when a friend comes over and suggests they steal beer and break into the church, it sounds, well, a lot more exciting than what is going on in their "real lives."

And the consequences of such actions are basically nil.  The odds of getting caught, for any criminal, are about 1 in 10, in most cases, somethings far higher.  The police just can't be everywhere and do not have the resources to investigate all crimes, and "property crimes" have the lowest priority of all.

And teenagers know, particularly if they are white kids from the suburbs, that even if they are caught, they will be tried in juvenile or family court, and given probation and a good talking-to from the judge and their parents.  And this is not really a big deal to them, and in fact, provides them with more thrills and attention that they are craving.  Plus, once caught, they will get a reputation at school as bad-ass bad boys, and the other kids will be impressed.

Which is, of course, one reason teenagers get caught at crimes like this - they want to get caught, in many cases.

So, from their point of view, a senseless act of vandalism has nothing but an upside for a teen.  And perhaps, if they break into the church, there may be sacramental wine, some money in the poor box, and a P.A. system to steal.   You never know!  And besides, it's fun to break all those fancy stained glass windows, right?

Well, that is the thinking, when you are drunk on sacramental wine.

For inner city gangs, the calculations are even more hard-edged.  In recent years, very young men - boys, really, have been recruited as gang members and given the task of assassinations and enforcement.  The street gangs have made the very real calculation that an 18-year-old faces the death penalty or life in prison, if caught, while a 13-year-old can be tried as a juvenile, and released at age 21, even after a conviction for premeditated murder.

For adult criminals, the calculus is more exact.  The odds of being caught are about 1 in 10, if you are stealing car stereos or breaking and entering.  And with experience, the good criminal knows which houses to hit, and when, as well as which cars to break into.  And many crimes are ones of opportunity - opportunities that they are constantly on the lookout for.  If you see someone trying car doors in the parking lot, they are not an amateur criminal, but a professional just on his way to work.

The penalties for crimes are factored into the crimes themselves.  And, unfortunately, this means that "getting tough on crime" can backfire in a big way.  Over the last few decades, we have tried to "get tough on crime" and fight a "war on drugs" by making sentences harsher and harsher, until they are literally insane.  A person can go to jail for a longer time for selling drugs than they can for shooting a cop dead.

Re-read that last sentence, and then do the math on it.  If shooting a cop gets you 20 years, and selling crack gets you 30, what does that say?  If a cop approaches you and says, "halt in the name of the law!" and you have a gun in your pocket - as well as 300 vials of crack - what are your options?

One option is to surrender, go to jail for a long time on drug and weapons charges.

Another option is to shoot the cop, and perhaps get away.  If you are caught, the sentence you get might be about the same as the drug charges you would have faced.  Likely, since they won't have 100% concrete evidence to convict you (you disposed of the gun and got rid of the drugs) they will offer you a plea bargain - for less time than you would have faced for selling the drugs (where they would have had a solid case, with a police officer as a witness, as well as the physical evidence).

People do the math on this, which is why it is a hard job to be a cop.  Stopping a car on a dark, lonely road, by yourself, could just be another traffic stop, or a quick shot to the gut and slowly dying by the side of the road.  How many roads and bridges are named for dead cops these days?

So, in a way, by escalating the war on drugs, we have escalated the violence.   And since the drugs are worth so much now, it is worthwhile to kill other drug dealers and steal their drugs.   After all, the punishment for killing a drug dealer - assuming you get caught - is not much more than the punishment for selling the drugs.

And guess what?  The police don't spend much effort investigating the murder of drug dealers.

Of course, white collar crime and fraud are the most profitable forms of crime - and the risks of getting caught and the possible punishments even smaller.  And weekends in white-collar prison are certainly no real punishment, compared to hard time in a real lock-up.

Given that, you'd wonder why more folks don't engage in the white-collar crime, instead of the more blue-collar variety.  And this is where emotions kick in.  People often don't succeed in life because they don't feel entitled to success.  They have a mental block of low-self-esteem that makes them think, "This is all I am good for, no more."  So the street criminal engages in petty larcenies, because he thinks that is all he is capable of.  The criminal with more self-esteem moves up the criminal ladder further.

Similarly, the OWS protester rails against the machine, while in an office 30 stories above him, one of his former classmates is watching the hubbub below and wondering where he can get his Lexus detailed.  The both had the same opportunities, the same educational experiences, but one feels empowered and one feels powerless.  Why is this?  Well, that is probably the subject for another posting.

So what prevents us all from becoming criminals?  Well, even while the odds of getting caught are 1 in 10, eventually, the odds catch up with you.   You get caught, you go to jail, and life sucks in short order.  And in many cases, most criminals, particularly the street-level variety, don't make a lot of money.  The street criminal or petty criminal is the minimum-wager slacker of the criminal world.

But since their normative cues are skewed, many criminals don't do the math on this and realize that a life crime really has no great long-term payoff.  The short-term gains reinforce the behavior, and that is all they see.  It is no different from the ordinary citizen going horribly into debt - the short-term gain is a shiny SUV and a fancy house.  The horrible end game, 20 years later, is not perceived at the time.

And for many of us, the stress and worry about being caught as a criminal are not worth the effort.  After all, if it is simpler and easier to not be a criminal wouldn't you do that?  And that is an interesting observation, in a society where more and more of our actions are under the threat of being criminalized, or we are constantly bludgeoned with the threat of criminal prosecution.

The flat-taxers, for example, really are not worried about tax justice - if they were, they would not be proposing something as absurd as a flat-tax, which would raise their own tax rates and provide a huge tax cut to the very rich.  Rather, they want the system simplified.  They are weary of being under what they perceive to be a life-long threat of audit and prosecution for filling out their complex tax forms wrongly.

Similarly, one problem with the criminality of drug use, like prohibition, is that it creates a very large criminal class in our country.  When everyone is a criminal, what does that say about your society's laws?  Prohibition collapsed simply because you could not criminalize the behavior of a large portion of the population to appease the moral values of a tiny minority.  And the end result of criminalizing everyday behavior is not less crime, but in fact, more.

Again, that economic evaluation.  Most people do not want to be criminals.  But if buying booze or pot is a crime, well then, they've already crossed the Rubicon.  Other crimes now seem possible, and in fact, less onerous.

Economics plays a role in enforcement, too.   Police go after low-hanging fruit, because it is easier to pick.  And you can arrest a tax-paying citizen a lot easier than a real criminal.  A guy with a real name, a registered car, a home address, and a job, is a lot easier to catch than someone using a phoney name who is fly-by-night.  It is easy to go after "citizens" but hard to go after criminals.

For example, I live on an island with 600 homes (many of them vacation homes, so the actual population is pretty small) and our own State Police Substation.   At any given time, we have two State Troopers on duty.  We are very well policed, to the point of harassment.

The speed limit on the island is 35 - and 25 in some spots.  People are routinely pulled over for rolling stop signs, speeding, and not wearing seat belts.  In a given month, they issue over 350 tickets and warnings, about 2-3 DUIs, and investigate 2-3 accidents.  That is at least 10-15 people a day they are pulling over, which is a staggering number for such a tiny place.

Do we have real crime on the island?  Not much, but occasionally a tourist's car is broken into by a "smash and grab" opportunist, who sees a purse or iPod or GPS on the front seat of a car.  They throw a rock through the window, grab what they can, and then run off.   Do they get caught?  No, but the Police are happy to write up a report and then lecture you for leaving "valuables in plain sight".

And as you leave the crime scene, they will pull you over for not wearing your seat belt.  And yes, I have seen this happen - to a friend of mine.

So more police is not necessarily a good thing.  To justify their existence, they have to pull over nearly everyone on our island.  I was pulled over the other day because the officer "couldn't tell if I was wearing my seat belt or not" - which is not "probable cause" under Terry v. Ohio.   Yea, that is what it comes down to - he gets a "credit" for issuing a warning, which helps him meet quota.  But just randomly pulling people over because you are not certain or not they are breaking the law?  That is a little scary to me.  But then again, on the other hand, when they are really running low on quota, they just set up a "safety roadblock" and start pulling everyone over.

But of course, the police do not have quotas for issuing tickets!  Remember that.  Unless of course, you are a cop.  See how long your career lasts if, after a month, you return your ticket book with all pages intact.

(And as you can imagine, I come to a full-and-complete stop at every stop sign, and obey the speed limit to the letter, using my GPS.  Frankly, I think I should get one of those dash cameras, as it is only a matter of time before they start just issuing tickets for the hell of it.  And yea, I have seen cops do that - even lie under oath in court.  Not all of them are saints!)

But that's the economics of law enforcement.  It is a lot easier to go after Joe Citizen and nail him for a traffic violation or a DUI than it is to go after a con artist who bilked some grandmother out of her life's savings or the guy who put a gun in your face and took your wallet.

And that's why, if you ever drive through Georgia, all you folks from Ontario and Quebec, on the way to Florida with your hubcaps missing (what is up with that?  Do you think we steal them?) be sure to obey the speed limit here in the Peach State.   Because Barney is going to get you with his Radar Gun, to be sure.  Speeding Canadians are the ultimate in low-hanging fruit....

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* If you ever want to get really depressed, Google "teenagers beat homeless man" - it goes on for pages and pages, in nearly every city in the country, and often the crimes are unsolved.  And people make jokes about this - including Jon Stewart, who made a joke on his show about thrill-killing a bum with a golf club.  He is rapidly becoming my least favorite funnyman.