A Theory Disproven. A Few Billion Dollars Misspent. A Country in a Crisis.

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Social ills are rampant in parts of America.  As seen in The Wire, our country has high rates of crime.  Noticing this, spending to combat this problem increased dramatically.  From 1987 to 2007, the year of the advent of the current recession, federal spending on corrections rose an inflation-adjusted 127%.  Furthermore, total state general fund expenditures on corrections rose 315%.  In trying to rid our country of one problem, we contributed to the creation of a massive other one – a deep financial recession.

Of course the housing bubble, sub-prime lending, easy credit conditions, deregulation, and other such things caused the financial crisis, but they are not the sole contributors.  Improper monetary allocation, including too many funds put toward diminishing crime, aggravated the financial crisis, contributing to the recession.

Acting based upon the theory that crime is a social problem that can be treated caused a rapid increase in the spending on it.  Money was infused into poorer areas in an effort to decrease inequality.  The basis of such spending was a theory that criminologists, sociologists, economists, and politicians alike came to strongly believe in: that poverty is the root cause of the commission of crimes.

When the economic recession struck and unemployment shot up, causing poverty to increase as well, crime should have rose according to the theory.  Yet, this was far from the case.  Crime has actually diminished drastically, reaching its lowest level since the early 1960s.  Some of the most drastic crime declines have been in areas hit the hardest by the burst of the housing bubble.

Crime rates are now low, but the country is facing other troubles, this time of an economic nature.  The money allocated towards some crime programs seems to have worked, but the money put towards decreasing inequality and social injustice has proved pointless. Billions of dollars were spent on crime prevention programs based on this disproved theory, but those billions of dollars cannot be recovered.  Instead, budgets are having to be cut on needed and useful programs and Americans are scrambling to sustain themselves and their families.

This situation brings to the light the idea that massive spending needs to be justified by empirical evidence rather than theories that simply seem to make sense.  The only glimmer of hope is that crime prevention programs may also be what help the economy to recover.  Only this time it will be the success of programs based on proven results, such as an increase in data-driven policing.  These programs are the ones that lowered crime rates and lower crime rates will inevitably assist in the recovery of the economy.

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7 Responses

  1. This is a fantastic post! I had no idea about these crime rate figures. I completely agree that the government needs to spend more time figuring out whether the programs they are allocating billions of dollars towards will actually benefit our society in the way they want them to. Too often do the bills fail to do for our society what they promise. We can’t keep wasting money.

  2. I agree that the amount of money that the government spends on crime prevention is enormous and often wasteful. However, while violent crime did decrease around 4.4 % in 2009 (according to the FBI’s preliminary report which can be found at http://www.fbi.gov/ucr/2009prelimsem/index.html), 3.2 %, or 7.3 million people, of Americans are in some part of the criminal justice system (http://bjs.ojp.usdoj.gov/index.cfm?ty=tp&tid=11). Consequently, with the cost of imprisoning one person estimate at near $25,000 per year, the costs of crime prevention programs are justified. Addressing the issues that cause crime, which have been shown to include social factors, is therefore a justified expenditure of federal funds because the huge costs of crime per year demands that the government takes steps to decrease its occurrence. So, while crime prevention programs can be wasteful at times, dismissing them as a waste of money is shortsighted because the annual cost of crime is to high to ignore potential methods of decreasing it.

  3. I never thought about the cost of other government programs contributing to the economic crisis so this was a very interesting post. However, I think that much of the money spent on these social programs was not “wasted.” I wonder what crime rates would be like had the government spent far less money on prevention. It is hard to attribute a problem as large as the economic crisis on misspending money on government programs. A balance should be struck but it is difficult to say how much money should be taken away from which social programs, all which benefit society in some way.

  4. This is a very interesting point. However, I agree with Macey and Derek that money spent on these crime prevention programs is not wasted. Even if the program fails and doesn’t work, at least an effort had been made to prevent crime. Unfortunately I think too often politicians try to throw money at a problem without fully thinking through how they could solve it. My question for Brooke is are you showing that spending on crime prevention and the recession are correlated? If so, how are you planning on finding research that will support that?

  5. Is this related to your paper topic? How is it that state budgeting for crime punishment (the judicial, police and prison functions) is related to the Great Recession? You say it is a misallocation. Ok. What kind of evidence would we want to see to make your point? Are states that spent more on crime punishment (whether it is actually preventive is another question that also punches holes in common sense that you can “lock em up” to make crime go away) relative to investments in human capital or other infrastructures weathering the crisis better?

  6. Derek’s FBI data from above brings up an interesting point with the decrease in crime. If spending on corrections was greatly increased since 1987, then of course crime rates are will decrease. With 7.3 million Americans in the criminal justice system, there is simply bound to be less criminals on the streets.

    Now considering the correlation between poverty and crime, I personally feel like the Great Recession provides a different situation than usual. Many honest working people were driven to poverty through poor investments and unemployment during the recession. This is different from a poor inner city neighborhood that is overrun by drugs, gangs, or theft. Poverty in that case is accompanied by culture and lifestyle. Americans who were raised to be honest and hardworking will not automatically turn to crime during a recession.

    So I would not necessarily say that the crime/poverty theory is disproved. Crime is encouraged by culture and not just money.

  7. […] A Theory Disproven. A Few Billion Dollars Misspent. A Country in a Crisis. […]

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