The Economic Consequences of Crime

[duncan drennan]

From Cees Bruggemans weekly comment,

Firstly, crime is a form of self-employment or self-help (also known as proletarian shopping). It directly levies a social tax on the community through the actions of possibly hundreds of thousands of people.

Whereas taxation is popularly depicted as highway robbery, taking from the well-off and distributing among the poor, it does so efficiently at very low collection costs, with at least a partial sense of universal agreement among the victims that any good will come of it (if the state is efficient in using the resources so collected and enhances the general welfare over time).

Not so crime, which in essence is also a Robin Hood activity, but a totally inefficient, often utterly destructive and devastating one.

This may be esoteric, but I wonder how much our trade deficit is influenced by crime? Electronic and other high value items tend to be the first on a criminal's shopping list and lots of those are imported...just a thought

[Dave A]

I think there was a time when there was a "Robin Hood" sympathy for thieves among the communities that they lived.

Now that "the people" are the victims, society at large seems to be rather less understanding.

In terms of effect on the economy - I can't conceive how crime adds value in any manner or form. But perhaps it is enabling low/no income group access to imported electronic goods and driving up import demand.

[AndreMorgenrood]

And then they steal electricity from the local grid to power these electronic goods which means we pay more for electricity

[Dave A]

This guy is suggesting an economic solution to crime. And I guess he should know. (from News24 here)

Johannesburg - The government should create jobs and provide education and skills development if it was serious about fighting crime, said the SA Prisoners' Organisation for Human Rights (Sapohr) on Friday.

"The government has a tendency of panicking and looking for a non-existent quick-fix for crime when they can prevent it by taking care of the people," said Sapohr president Golden Miles Bhudu.

He said people got desperate when basic needs such as shelter, food or employment were not met.

They would rather commit crime than die of starvation in a country with such a booming economy, he said.

Socio-economic situation

Speaking to reporters in Johannesburg, Bhudu said it was for this reason that the government and business should pay special attention to ex-prisoners.

"When they come out of prison their socio-economic situation is worse than before.

"If they still don't have shelter and food they will commit more crime and return to prison."

In a country of about 45 million people, more than 500 000 go through the prisons every year and return to the community, said Bhudu, adding that the majority of them were re-arrested within three years of release.

"If we could reduce the recidivism rate by 10%, South Africa would save more than R1bn a year in prison costs alone," said Bhudu.

'Crime rate would definitely be reduced'

He said the safety and security department's strategy to fight crime was "not good enough and would lead only to courts and correctional services being over-crowded".

"There can be more police officers in the country, but if people still don't have jobs, they will still take the risk and commit crime, in the hope that they will not be caught."

Sapohr recommended that the justice system should engage with community leaders, and play a more active role in the reintegration of offenders.

"They should be employed, even if they have criminal records.

"They also should have access to proper support structures, or otherwise, we are sending them straight back to prison where they will have food and shelter," said Bhudu.

He said if government could provide for the poor and needy - both the general public and ex-prisoners - the crime rate would "definitely be reduced".