The economics perspective

If anyone missed the reality that economics govern policy, two recent events make the point.

The tragic aftermath of BP’s oil spill and death toll made the company
a worldwide villain. Within months, United States victims were being
forgotten as BP stockholders in the U.K. complained that they were
being victimized by BP’s compensation to injured parties. And BP
officials also challenged the United States government’s suggestion
that new offshore drillings would be stopped, arguing that doing so
would interfere with its ability to pay damages for its wrongdoing.

In another development, economics has become a factor in the corrections process. Missouri now requires sentencing judges to consider, along with all the traditional considerations when sentencing convicts — criminal record, nature of the crime, etc. — what a particular punishment will cost the state. For example, a recent report pointed out, for one offense incarceration will cost the state $37,000 while probation would cost $6,700; for another crime, the imprisonment cost would be $50,000 compared to $9,000 for probation. The cost differential goes up as the duration of a sentence increases.

Interestingly, fiscal conservatives were joined by defense attorneys in praising the Missouri practice, though an obvious result would be less imprisonment for convicts. American prisons are notoriously overcrowded. Reformers have been unsuccessful basing their arguments on good sense or common humanity. Criminal justice budgets nationally are in dire straits, so this new approach may be adopted elsewhere. Thus, the reform of prisons may depend, not on being tough on crime or being in favor of rehabilitation over incarceration, but rather on economics.

Isn’t that always the case, in the end?