Tuesday, October 26, 2021

Crime and Poverty


William Barr, William Scott Dwyer, and Patrick Fagan all agree that poverty is not a cause of crime (5; ÒPart 2Ó, 1; 3). Poverty does not directly cause crime; instead, it is a factor in the cause but, independently, it is not the root source (Barr 5). During the Great Depression, poverty levels were much higher than they are today, but crime actually declined (Barr 5; Fagan 3). From the mid-sixties to the mid-seventies, income was on the rise and crime moved right along with it (Fagan 3; Dwyer Part 21). In 1990, the income level was much higher than in was in 1903, but the murder rate in 1990 was ten times higher than the murder rate in 1903, which was at 1 per 1000 inhabitants (Dwyer Part 21)

Another argument presented by Barr and Dwyer, inverts the poverty/crime relationship by stating that crime actually causes poverty. One of the premises for this argument focuses on businesses and how crime deters potential employers from establishing them (Barr 2; Dwyer ÒCrime and Poverty, Part 1Ó). One reason for this is that crime against a business reduces revenue, raising prices in impoverished neighborhoods because merchants have to make up for any losses caused by theft. These high prices also suppress the standard of living in the community, as the income in the community cannot keep pace with the rise in prices. Blacks living in high crime areas suffer from poverty because they pay higher prices for food and other goods than do whites in neighborhoods with less crime (Dwyer ÒCrime and

Poverty, Part 1Ó). Crime also decreases the likelihood that an area sees improvement; Barr describes a Òsmall contractor who tried to rehabilitate inner-city housing for low income tenants. He had to give up because drug addicts would break in, rip out his improvements, and sell them for drug moneyÓ (2). 

https://hilo.hawaii.edu/campuscenter/hohonu/volumes/documents/Vol07x03TheCauseofCrime.pdf

https://bjs.ojp.gov/library/publications/household-poverty-and-nonfatal-violent-victimization-2008-2012

https://www.nytimes.com/2011/04/21/nyregion/kiryas-joel-a-village-with-the-numbers-not-the-image-of-the-poorest-place.html


Voters Need to have Tax Incidence Drilled into their Heads

The Democrats are proposing new taxes but Aswath Damodaran calls it: The Billionaire Tax: The Worst Tax Idea Ever?:

Voters need to have Tax incidence drilled into their heads. If we raise a tax and raise some spending, who consumes more goods and services and who consumes less. If you tax unrealized capital gains on billionaires and spend it on a child tax credit, low income families with children will probably consume more goods and services BUT because billionaires consume so small a percent of their income, they will not consume less. So who will consume less, middle-class families will. How this works through the economy is hard to see, but they surely will. That may be OK but it would probably be much more efficient to do that through other means and I think as much as is reasonable possible people paying for something should know that they are.

Progressive consumption taxes and LVT (land value taxes) taxes seem to be the best ways to raise revenue if you need to do that, BUT the bigger problem is, too much taxing the non poor and inefficiently spending on the non-poor.

Examples: 

Social Security should pay $240/week to all retirees (better yet $240/week to all adult citizens instead).

Medicare should not pay for any treatments that the UK NHS does not provide and there is a lot of it, and UK NHS does not provide it because the cost is not close to worth the benefit. (Also an alternative less controversial way to cut medicare and other medical spending: This is an improved version of my idea for supporters of single payer healthcare.)

Military spending should be cut in half and spent without regard to congressional district.

Get that done and then if you still need more revenue we can talk.