Benefits and costs: crime, crime avoidance, crime control

Crime has been a badly underestimated problem: more so among scholarly experts than among ordinary citizens or elected officials.  A1% reduction in crime provides economic value – measured in terms of willingness-to-pay – of something like $15 billion a year.

The material losses due to victimization are only a small part of the crime problem.  For example, property losses from residential burglary average out to $4 per house or apartment per month.   And yet, in a survey, people asked how much they would be willing to pay out of their own funds to reduce burglary in their community by 10% gave an average answer of $100 per year.

One difference between victimization losses and other costs is that victimization doesn’t just happen.  Victimization is done to someone by someone else.  Being singled out – even anonymously – by another person for ill-treatment is a different experience than being the victim of mere happenstance. “Even a dog,” said Justice Holmes, “knows the difference between being stumbled over and being kicked.”  

As a result, people make extensive efforts to avoid being victimized:  everything from double-locking doors to moving to the suburbs.  How, in the absence of crime, could one account for the coexistence of housing abandonment and new housing construction only a few miles apart?  The direct and secondary costs of crime avoidance easily swamp the immediate costs of victimization.  

Now, it might seem that if avoidance costs exceed victimization losses, the avoidance costs must be irrationally high.  Not so.  The victimization losses we observe are those that remain after potential victims have taken countermeasures in the forms of locks, burglar alarms, gated communities, and suburban addresses. One reason crime has fallen in the past decade is that potential victims – households and businesses – have moved away from high-crime neighborhoods into low-crime neighborhoods.

Much crime-avoidance behavior is wasteful from a social perspective, but not from an individual perspective.  If my putting a burglar-alarm sticker on my front door simply leads a burglar to break into my neighbor’s home instead, the victimization loss is shifted rather than avoided, and in effect I incur a real resource cost to make sure that someone else suffered the cost of being burglarized.  But that fact makes putting up the sticker no less rational for me as an individual. 

Crime-avoidance behavior can impose costs on others beyond shifting crime risk.  Residents and businesses fleeing high-crime neighborhoods generally make things worse for those who stay behind; abandoned houses make bad neighbors and shuttered factories and stores provide no jobs.  Crime thus becomes an important sustaining cause of concentrated poverty, turning an old notion on its head.

Costs and Benefits in Crime Control

The current total budget for law enforcement and criminal justice, adding together all levels of government, comes to about $200 billion a year.  If a 1% reduction in crime is worth $15 billion, even modestly successful crime-control efforts can easily justify their budgets.  Even as wasteful a use of prison resources as California’s Three Strikes law would have – had California actually built all those prisons – provided crime-control benefits to California’s residents that would have more than covered its monetary costs.

Money, however, is not the only thing we should try to economize.  We should strive to be economical in imposing suffering.  Having fewer prisoners is desirable: not, primarily, because prisons cost money but because prisons are horrible places, imposing misery not only on those confined in them but to the people who care about those prisoners:  their families, their friends, and their neighbors. 

The notion that deserved suffering somehow “doesn’t count” is a piece of mere hand-waving with no rational basis in terms of benefit-cost analysis; desert may be, morally, a reason to punish, or a limit on punishment, but it can’t be a reason to ignore the fact that punishment hurts.  And in the usual case the suffering of the families, friends, and neighbors of prisoners is entirely undeserved. 

Policing and community corrections involve a higher ratio of threat to actual punishment than do prisons or jails. That means that non-prison spending should be preferred to prison spending if we can achieve a given crime-control gain for the same additional dollars by spending it on cops and probation officers rather than spending it on further expanding institutional corrections.

Expanding even these less punitive parts of the system has a cost in terms of liberty, and that too should be economized. But we should keep in mind that the living under the threat of crime is also liberty-reducing; “freedom from fear” applies to more than fear of arrest.

By the same token, controlling crime by providing services, where it works, is greatly preferable to controlling crime by threatening or inflicting damage.  The positive-feedback nature of the crime problem means that services, though they may compete with criminal-justice operations for budget dollars, are synergistic with criminal-justice operations in the field.  Whatever shrinks the baseline level of offending increases the pressure on the remaining offender population from any given criminal-justice effort.

The problem is to find actual, practicable, scalable social programs that actually reduce crime, for amounts of money comparable to the cost of reducing crime using force and the threat of force.  Given the extent of social gains from reducing crime, any substantial crime reduction we could bring about just by spending practicable amounts of money will be cheap at the price.