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Measuring the costs to society and victims

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In addition to the direct costs of administering a criminal justice system, you must keep in mind numerous other, less obvious costs. Quantifying these costs is an ongoing challenge for economists and criminologists alike.

For example, the cost of preventing crime throughout society can be quite large. Many retail stores have loss-prevention units. Many businesses and homes have security cameras and systems, and some also employ private security patrols. Some economists even include costs such as security lighting and locks in their estimates of how much crime costs society. They reason that these costs are ones that a crime-free society wouldn’t have to pay. And, of course, in addition to physical security, every business must have high-quality computer security to protect against Internet hackers and criminals.

After a crime occurs, all kinds of additional costs come into play. For example, a woman who had $100 stolen is obviously out $100. (Some economists argue that this loss isn’t a net loss to society because it’s just a transfer of wealth from a victim to a criminal.) But the woman may also lose wages or vacation time if she calls the police and ultimately has to go to court.

Property crimes (such as vandalism) and illegal drug manufacturing can dramatically impact the value of a home or even a neighborhood. During the methamphetamine manufacturing epidemic in the 2000s, meth labs sprang up seemingly everywhere in the West and Midwest. The chemical residue from a meth lab was so toxic that any house with a lab had to be completely scrubbed — the cleanup costs alone could reach up to $100,000. (While meth is still a major problem, the manufacturing of it now takes place almost exclusively in Mexico. See Chapter 9 for more on international drug trafficking.)

Assessing the costs of violent crimes can be even more complex. A victim of a violent crime may incur costs for medical treatment and mental health counseling. Often victims themselves don’t bear the full cost of medical treatment; taxpayers, insurance companies, or hospitals pick up a significant portion.

A study by Philip Cook, Ted Miller, and Bruce Lawrence examined the medical cost of the 138,000 gunshot injuries that occurred in the United States in 1994. The medical cost was more than $2.3 billion (or about $17,000 per injury), and taxpayers picked up 49 percent of that cost.

A victim’s emotional trauma may be so extensive that it impacts his ability to earn a wage, resulting in a lower-paying job or even loss of work. Economists conclude that the emotional damage from rape and sexual assaults has the greatest economic impact of any crime (next to murder, of course). Another part of the economic impact of violent crime is the reduction in the quality of life that a victim endures from the injury itself. Some economists have used “pain and suffering” judgments from civil lawsuits to estimate the financial impact of a similar injury on the victim of a crime.

Economists may also consider the productivity loss to society when a person becomes a criminal rather than a positive, contributing member of society. The failure of a criminal to earn a wage and pay taxes is a net loss to society. Drug crime helps demonstrate this fact. After all, a drug dealer doesn’t pay taxes, and he sells a product that makes other people less productive in their legitimate jobs. Drugs also lead to social welfare costs because drug abusers often can’t care for their children or themselves and usually require several rounds of drug abuse treatment.

When you combine all these factors, you see how complex the cost analysis is, and you see how far-reaching and expensive the impact of crime is. For cybercrime alone, one survey found that, in 2019, a typical large company had $13 million in losses and security costs.

Studies attempting to estimate the annual economic cost of crime in the United States range from $690 billion on the low end to over $3.4 trillion. That is between $2,000 and $10,000 for every person in America!

Criminology For Dummies

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