Benefit: Crime Reduction

Why should net taxpayers hand out free money for all citizens? How about reduced crime? It is far better to be robbed by the IRS in a fair and orderly fashion than to be mugged or burglarized. It’s safer.

It might even be cheaper. The IRS takes money – in a predictable fashion. A burglar can take precious irreplaceable family heirlooms. Not to mention the sense of insecurity. And consider the enormous cost millions pay to live away from bad neighborhoods: the excess housing, the long commutes, the loss of community. And then figure in the tax dollars we send to keep the core cities financially afloat as their tax bases move away.

And since we spend over a trillion a year in welfare programs and tax expenditures aimed at the lower classes, anyway, we aren’t talking about that much more tax money, if any.

This assumes, of course, that giving away free money will reduce crime. Charles Murray backs away from that promise in his book In Our Hands [page 62]. Kudos for him for not over selling his idea, but I must differ. Crime reduction is not only a major potential benefit, it might be the biggest benefit for millions of net taxpayers.

If you have money to live on, you don’t need to go into crime to survive. Not only that, the better life is on the outside, the more it behooves you to stay out of prison. Simple economics says free money makes crime pay less.

But Charles Murray rightfully points out that we had rising prosperity and an increasingly generous safety net through much of the 20th Century, yet had increasing crime. (And though crime is back down quite a bit now, we got it down by increasing the prison population enormously.) I would point out that we also had several confounding factors:

While we would probably benefit from dialing back the War on Drugs, reviving vigilante “justice” causes more problems than it solves. I would not recommend reviving the Ku Klux Klan! And anyway, we don’t have to resort to these confounding factors to explain why the welfare state did not reduce crime. For the population most prone to criminality, the welfare system failed to reduce the incentive to criminal activity.

Consider some of the earliest welfare programs: Social Security and Aid to Families with Dependent Children. Social Security went to old people. AFDC went mainly to unwed mothers. Now, how often do you hear of a house burglarized by a senior citizen? How many people have been mugged by unwed mothers?

The most dangerous potential criminals are young able-bodied males – the precise population expected to work and not be on welfare. Without welfare for able-bodied young men, the premise that welfare should discourage crime does not apply.

We do now have some welfare programs for young men, but how about cash benefits? Even with Food Stamps and public housing, you still need some cash for various purchases. Just how much assistance is available for the young man fresh out of prison, who is thus nearly unemployable?

It gets worse. By targeting unwed mothers, need-based welfare discourages marriage. Marriage is a powerfully civilizing institution – more civilizing than productive work. Recall the Wild West, where we had a high concentration of employed but unmarried young men. (Racists in the audience should take note: the criminal gunslingers of old were generally white, often ex-Confederate soldiers.)

Productive work is also civilizing, of course. Need-based welfare puts a high price on productive work. If you have a job, you aren’t needy. Benefits go away. The marginal loss of welfare benefits today is far higher than the marginal tax rate experienced by the rich. Laffer Curve enthusiasts take note.

Criminal income, however, is not reported to the IRS or welfare agencies. While the penalty for robbing and drug dealing may be higher than for getting a real job, the probability is far less. Get a real job complete with reporting to the IRS, and loss of benefits is certain. A life of crime may be less risky than picking tomatoes or other temporary work.

Free money for all citizens also takes care of the black market for labor. Millions of people have sneaked across the border illegally because wages here are well above world market levels. Since they are here illegally, they cannot safely call the police if robbed. They are thus easy prey for gangs. If we tax even the first dollar of labor, and make our tax code progressive by giving only citizens a rebate/prebate, then we reduce immigration pressure. For those who find it still profitable to be here as net taxpayers, we can afford to grant them legal status. We replace quotas with a price for coming here. In return for paying a price, guest workers need not take dangerous routes to cross the border, and they can call the police safely when persecuted by gangs or other criminals. Low wage citizens, on the other hand, do not pay a price for citizenship. They get a net dividend.

Citizenship is thus valuable even for those who lack the talents needed to fully capitalize on the benefits of living in a rich country. This puts the “Us” in U.S. even for the descendants of those persecuted by the United States not that long ago and haven’t been able to capitalize on the end of official racial discrimination. Free money for all can serve as reparations for past injustice – imperfect, but better than nothing. The “Us” factor is incredibly important for reducing crime. Throughout history and before, for all races and nationalities, it has been honorable to do to “Them” what was criminal to do to “Us.” This includes white Anglo Saxon Protestants. Think privateer vs. pirate. Free money for all citizens can approximate reparations for past injustice making the United States “Us” vs. “Them” for those not already compensated for past oppressions.