Increasing Minimum Wage ‘Could Reduce Crime’

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Increasing the minimum wage, and investing in more police, education and jobs would accomplish more for public safety than the  billions of dollars spent every year on  prisons and courts, says the President’s Council of Economic Advisors (CEA).

The White House has launched a week-long push for justice reform with a hard-hitting cost-benefit analysis of the justice system, telling Americans that they are not getting what they paid for.

The 80-page report from the CEA said “real expenditures” on criminal justice have grown by over 70 percent in the last two decades to over $270 billion—or $870 per capita.  In 2013, 11 states spent more on corrections than on higher education.

But any public safety gains from these expenditures have been outweighed by the devastating toll they have taken on the lives of individuals, families and communities, the report said. For example, the report noted that the formerly incarcerated earn 10 to 40 percent less than similar workers without a history of incarceration; and the probability that a family is in poverty increases by nearly 40 percent while a father is incarcerated.

The report, titled “Economic Perspectives on Incarceration and the Criminal Justice System,” argued that it made more economic sense to shift the nation’s priorities towards fostering conditions that reduced the likelihood of criminal behavior—such as decent-paying  jobs and better schools.

Applying what it called a “back-of-the-envelope” cost-benefit test, the CEA concluded that raising the minimum wage to $12 by 2020 would result in a three to five percent crime decrease and a “societal benefit” of $8 billion to $17 billion.

It also suggested that a $10 billion investment in police hiring would decrease crime by five to 16 per cent.

“Investments in police and policies that improve labor market opportunity and educational attainment are more cost-effective than additional incarceration, and can reduce the collateral consequences of convictions,” the CEA report said. “Offering more correctional education and job training for inmates and the formerly incarcerated can reduce barriers to reentry and decrease recidivism.

“Reconsidering the ways we impose sentences, monetary sanctions, and bail payments can make our criminal justice system fairer and smarter. “

Much of the report’s analysis was drawn from academic studies and research long in the public domain, but it represented a powerful high-level indictment of the tough-on-crime policies that have been pursued by policymakers over the past several decades.

“The reason we have so many more people in prison than any other developed country is not because we have more criminals—it’s because we have criminal justice policies, including unfair sentencing laws, that need to be reformed,” President Barack Obama said  Saturday in his weekly radio address.

The address set the stage for “National Reentry Week,” which the Administration is using to announce new steps to help the formerly incarcerated reintegrate into society—including giving them a “fair shot” in the competition for federal jobs, and calling on businesses around  the country to commit to hiring ex-inmates.

Obama also used his address to prod Congress into approving legislation to overhaul federal sentencing guidelines. A Senate bill, which received bipartisan sponsorship, has bogged down over objections from several senators.

Obama said the country need to move ahead in a bipartisan way to make the justice system “smarter, fairer, less expensive and more effective.”

Among the most tragic casualties of the nation’s skewed criminal justice spending priorities, the CEA report said, were the five million children who have experienced one or two incarcerated parents at one point in their lives..

A separate report released today by the Annie E. Casey Foundation called for new policies to assist parents, communities and caregivers.

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