Wednesday, February 16, 2005

Making 'Em Pay

With the trials that are the fallout of recent corporate scandals occupying the headlines, many people are gleefully watching to see long prison sentences handed out to the guilty. While this is understandable, given that the alleged crimes resulted in a lot of people losing a lot of money, there is also a sense of "getting back at the wealthy," and this tends to cloud a larger issue. Specifically, should these people be going to prison?

I don't mean to question whether corporate criminals should be punished. Clearly, a crime should be punished, especially when it harms a large number of people. However, as satisfying as it might be to lock corporate criminals away, does this serve the public interest?

Let's consider what purpose prison serves. There's obviously a punitive element to it, but there's also an element of self-defense. By putting someone in prison, society is protecting itself from the danger that person poses while at liberty. It is, in fact, somewhat expensive to incarcerate people; for violent criminals society deems this expense justified by the greater overall safety that results from these criminals' imprisonment.

Is this expense justified for corporate criminals? Who is going to be shot by them? What windows are going to be broken? How many houses are going to be buglarized? Why, in short, should society spend money to punish them?

If someone has gotten rich by defrauding others, it seems logical to punish him by removing his riches. Obviously, the ill-gotten gains should be returned to society (and, if possible, the victims), but there is no need to stop with simple restitution. Fines can be an effective punishment, especially to those for whom money is a primary motivation.

These fines would have to be sufficiently high to be punitive, and a set scale of fines for particular crimes clearly won't do. What might be severe punishment to one person, such as Martha Stewart, will be inconsequential to another, such as Bill Gates (not to imply that Mr. Gates is guilty of any crimes). There is some fine, however, that will make Bill Gates take notice, and cause a severe disruption in his life.

This principle of using fines more heavily where we currently use prison doesn't only apply to the wealthiest criminals. Crime at all levels is often motivated by economics. If a crime becomes unprofitable, then people will tend to stop committing it. Perhaps not completely, but we would expect the rates to decrease substantially. Certain minimum fines could be established for, say, selling drugs that account for not just the value of the sale that led to the arrest, but the estimated value of the likely sales that were not caught. Basing these fines on statistical data is in fact preferable to attempting to set a specific fine for a specific individual, since the latter lends itself to charges of bias, profiling, and presumed guilt.

While possibly not as satisfying as prison sentences, truly punitive fines can better serve the public interest. Instead of paying money to punish a criminal, society can receive money for that punishment. In addition to the direct savings (and increase in revenue), we might expect crowding to be less of a problem in our prisons. Minimum-security prisons might be essentially eliminated, as well, or converted to more secure facilities more easily than new ones could be built. In all, it seems more sensible to punish non-dangerous criminals in their pocketbooks than in prison cells.

No comments: