Ch 4. Economics

… if we cut income inequality we can cut rates of offending. This is one of the justifications claimed for tax-and-spend redistributive policies, but it was always one of the incentives for philanthropic social policies proposed by reformers like Charles Dickens and famously summed up by his American contemporary, Robert Charles Winthrop: ‘The poor must be wisely visited and liberally cared for, so that mendicity shall not be tempted into mendacity, nor want exasperated into crime.’

Mendicity means begging. Robert Charles Winthrop (1809–94) was Speaker of the US Congress, later a senator, and more recently better known as great-great-grandfather of the 2004 presidential hopeful John Kerry.

 

image001

 

In a poll of 12,000 people in twenty-three countries Greece emerged as the country with most grievances against the affluent, with over 90 per cent believing the rich did not deserve their wealth; whereas almost two-thirds of Australians thought they did.1 Yet Greece has one of the lowest crime rates and Australia one of the highest.2

[1] Poll by GlobeScan for The Economist online, 11 July 2012. [http://www.economist.com/blogs/graphicdetail/2012/07/daily-chart-7?fsrc=scn/tw/te/dc/dorichdeservefortune]

2 While international comparisons are rarely straightforward, Greece has a lower crime rate than Australia on almost any measure. For example, its 2011 murder rate was 0.7 per 100,000 whereas Australia’s (after several years of reducing homicide) was 1.2.

 

image001

 

Fear of the poor is one of the most powerful reasons that middle-class folk seek to live in middle-class districts and avoid what they see as perilous sink estates.

It is true that in ‘deprived’ social housing it is the relatively affluent homes that offer most temptation and so tend to suffer most burglary. But that very fact illustrates that even the most down-at-heel estates usually contain a mix of housing and social circumstance, so general area descriptions can be misleading. Also we should be cautious about seeing poverty as a root cause; ‘deprived’ areas may be poor only because the more successful people move away, in which case blue-collar crime might result from a failure to thrive, not a lack of money. Thus, when rioters in 2011 were said to come mainly from poorer areas the superficial interpretation was that poverty caused the disorder, but it is at least as likely that their unfashionable addressed were just another symptom of their inability to flourish. See Kate Bowers, Shane Johnson and Ken Pease, ‘Victimisation and re-victimisation risk, housing type and area: a study of interactions’, Crime Prevention & Community Safety, Vol.  7(1), pp. 7–17, 2005.

 

image001

 

But, equally plainly, the relationship between wealth and crime is far from straightforward.

Poverty theories for crime remain deep-rooted despite strongly confounding evidence including international comparisons. By 2007 the International Crime Victimisation Survey was able to report not only that crime was still falling across the board but that, “The ten countries with the highest rates comprise both very affluent countries such as Switzerland, Ireland and Iceland as well as less affluent countries (Estonia and Mexico). This result confuses conventional wisdom about poverty as a dominant cause of crime.”
Jan Van Dijk, Manchin, John Van Kesteren, Hideg, The burden of crime in the EU, a comparative analysis of the European Survey of Crime and Safety (UE ICS, 2005), Brussels, Gallup Europe, 2007 (quoted Jan van Dijk, John van Kesteren, Paul Smit, Criminal Victimisation in International Perspective, Key findings from the 2094-2095 ICVS and EU ICS), 2007, p43.

 

image001

 

Professor Becker went on to do some serious research. He quickly realised that if you commit a major crime the police will throw the book at you; but for most offences, the mass transgressions from parking to shoplifting, burglary or car theft, crime can make economic sense.

Gary Becker was awarded the Nobel Prize for Economics in 1992, though he was by no means the first economist to try to tackle the causes of crime. Marx had had a go, of course, and his approach was synthesised in 1916 by a Dutch professor, Willem Bonger, who saw capitalism as the engine of selfishness. In 1938 Robert Merton blended Bonger’s views with Durkheim’s Anomie or strain theory, proposing that crime is the result of offenders’ exclusion from society’s material success since, for them, stealing is the most efficient way to achieve economic status. Merton’s views helped inspire 1960s affirmative action programmes in the US, and influenced several left-leaning political economists in the 1970s, though, as we shall see, his approach may explain violence better than theft.

 

image001

C=PTO2. Crime is the outcome, people are just one of the components that make up the equation, temptation is the mainspring and opportunity is the enabler and by far the largest factor in determining how much crime takes place.

P, or personality, is hard to change, especially in the short term, although it does seem to evolve. In 1947 1,200 children’s personalities were assessed by their teachers in Scotland. In 2012 about 170 of them were traced, now in their seventies, and were rated again. Even allowing for subjectivity of the judgements, the researchers were surprised at apparent changes. Scores for self-confidence, conscientiousness, originality and desire to learn often were rarely consistent with those six decades earlier. Only mood and conscientiousness remained stable.  (Matt Harris, Caroline Brett, Wendy Johnson and Ian Deary, ‘Personality stability from age 14 to age 77 years,’ Psychology and Ageing, Vol 31, 8, pp 862-874, 2016, DOI: http://dx.doi.org/10.1037/pag0000133.)

 

image001

 

Murder rates, for example, having generally fallen in Britain from 1900 to 1960, then more than doubled to a peak in the mid-1990s.

9.6 homicides were recorded per million population of England and Wales in 1900, falling to 6.2 in 1960, then rising consistently to 14.5 in 1995. Prison populations echoed this trend, suggesting prison rates are a consequence of crime rates rather than a major influence on them. Joe Hicks and Grahame Allen, A century of change: trends in UK statistics since 1900, House of Common Research Paper 99/11, 21 December 1999, pp. 14–15. (For comparison, homicide rates in England and Wales in 2005–6 were 13.6 per million.)

 

image001

 

Throughout the Western world it was the ‘golden age’, as economies powered ahead,1 with the US leading the way in a ‘showcase era of capitalism’, while Australia had its ‘long boom’, Germany its ‘Wirtschaftswunder’, France its ‘Trente Glorieuses’, Italy, Scandinavia and Japan each had their ‘economic miracles’  and, as we noted in Chapter 2, Britain had ‘never had it so good’.2 In all these countries, growing affluence was accompanied by falling income inequalities.3

1 Post-war growth in Europe was at twice the level of the inter-war years, and 1950–73 was ‘exceptional’ by any standards (see: Nicholas Crafts and Gianni Toniolo (eds), Economic Growth in Europe since 1945, Cambridge University Press, 2003, ISBN 052149964X)

2 In July 1957 British Prime Minister Harold Macmillan cautioned a Conservative Party rally about the dangers of inflation but noted: ‘Let us be frank about it – most of our people have never had it so good. Go around the country, go to the industrial towns, go to the farms and you will see a state of prosperity such as we have never had in my lifetime – nor indeed in the history of this country.’  Global inflation did come to dominate economic s but not until the 1970s and even in the worst times most years saw economic growth, and GDP growth per capita surged ever upwards.

3 As measured by the standard Gini coefficient.

 

image001

 

A classical illustration taught to students had been to correlate the price of bread in nineteenth-century Bavaria and the numbers of people arrested for vagrancy and theft: as the price of bread went up, so did the arrest rates.1 Since most criminologists were socialists or social democrats, they predicted that ‘most forms of crime would simply disappear as soon as just, egalitarian society would have been established’.

1 This example was first cited by a German academic, Von Mayr, but was widely used throughout the twentieth century.

2 Jan van Dijk, Closing the Doors, Stockholm Prizewinners Lecture 2012.

 

image001

 

One by one, the bewildered authors ticked off the socio-economic markers that might point to trouble, but incomes were up, unemployment was down, more poor and black children were completing high school, and the number of families living in poverty was declining sharply.

Summary report, National Commission on the Causes and Prevention of Violence, 1969, xxxvii, Lyndon Baines Johnson Library.

 

image001

 

In the inter-war years spare time was more of a problem for the well-to-do, and it was often youths from the upper classes who earned a reputation for acting badly, with wild pranks, drunkenness and licentiousness – the British expression ‘behaving like a public schoolboy’1 did not mean behaving well. As the pitilessly direct Conservative sage Lord Tebbit put it: ‘When I look at what we denounce as the appalling conduct of “ordinary people” I see the way the rich have always behaved. It’s just that they have had the resources to deal with the fallout.’2

1 Confusingly, private schools in the UK are known as public schools. The term ‘public’ was first used to describe Eton College, founded in 1440 and open to all, provided they could afford it, in contrast to religious schools which were restricted to faith members, or private education which took place with tutors in the home and was available only to the very wealthy.

2 The Observer Magazine, 27 January 2008, p. 11

 

image001

 

As never before they rocked to their own genres of music, their own hairstyles and clothes, they bought motorbikes and scooters and cars, and they gulped down alcohol in growing quantities.

Håkan Leifman, Trends in Alcohol Consumption in the European Union, [http://www.sofi.su.se/eupres7.pdf]

 

image001

 

In the US the proportion of women of working age who had a job roughly doubled between 1945 and 1995, a trend that was echoed in the UK and all of Western Europe.

Margaret Walsh, Recent Findings of Research in Economic & Social History, Vol. 30, 2001.

 

image001

 

So, seven wonders of the world, the harvest of post-war prosperity. Here was a feast of attractions, seductions, frustrations, provocations, excitements, liberties and opportunities which, for all their manifold blessings, were sometimes perilously similar to the seven deadly sins.

 

The seven deadly sins were luxuria (lust), gula (overindulgence), avaritia (avarice), acedia (laziness), ira (anger and impatience), invidia (envy) and superbia (narcissism).

If the person you insult has little self-respect to start with, an absurdly trivial slight can wound and can lead to serious aggression. This is especially perilous when tongues and fists have been loosened by alcohol

A survey of hospitals found that when people attack each other in peacetime they are likely to be male and in their teens or early twenties – driven by hormones and peer pressure as much as by prudence and a desire for self-improvement. The trigger is likely to be bullying, vindictiveness, jealousy, rage or, above all, sheer alcohol-fuelled aggression rather than because of money. ‘The largest in number are young men, who tend to be assaulted in and around pubs and clubs on the weekends. These assaults usually involve alcohol consumption and violence by victims as well as by the assailants.’ Between a third and a quarter of victims are women, many of whom have been drinking or binge drinking.’ Julie George, Casualties of Crime: A Literature of Assaults and Accident & Emergency Departments, London Health Observatory, April 2003, p. 6, ISBN 0-9542956-1-7.

 

image001

 

A Washington Post journalist who’d grown up in a black ghetto reported:

They’ll kill a nigger for dissin’ them. Won’t touch a white person, but they’ll kill a brother in a heartbeat … It was as if black folks were saying, ‘I can’t do much to keep white folks from dissin’ me, but I damn sure can keep black folks from doing it.’

Nathan McCall, Makes Me Wanna Holler: A Young Black Man in America, Random House, NY, 1994, p. 52. (Quoted in Richard Wilkinson et al., above.) Nathan McCall was a Washington Post reporter who had grown up poor and had been inside for violence.

 

image001

 

A survey in the English Midlands found people from the most deprived areas were four times more likely than to be admitted as assault victims than those from the least deprived ones.

A. Downing, S. Cotterill, and R. Wilson, ‘The epidemiology of assault across the West Midlands’, Emergency Medicine Journal, September 2003, Vol. 20, pp. 434–7.

 

image001

 

So when research suggests that simple lack of money is the problem – for example, homicide has been broadly found to match income inequality across more than thirty countries – it might be that poverty is a symptom not the cause

Pablo Fanjnzylber, David Lederman and Norman Loayza, ‘Inequalities and violent crime’, The Journal of Law and Economics, Vol. 45, University of Chicago, 2002.

 

image001

 

At any rate, when forty years of post-war economic growth were checked against a dozen forms of crime, violence did not diminish as society grew richer. It grew in step with per capita consumption.

Simon Field, Trends in crime and their interpretation: A study of recorded crime in post-war England and Wales, Home Office Research Study 119, 1990, ISBN 0-11-340994-X. [http://www.ncjrs.gov/App/Publications/abstract.aspx?ID=126742]

 

image001

 

The last time the hunger excuse was used in Britain was after thugs were chased out of a Michelin-starred restaurant in Notting Hill and one of the culprits explained in mitigation that he had needed food. It turned out he and his equally well-nourished co-defendants lived in housing provided by Kensington & Chelsea Council, in one case worth £2.5 million.

The Times, London, 9 August 2012, p. 3. During the riots in 2011 a gang had stormed into the Ledbury restaurant in London demanding jewellery and money from the customers. The intruders were chased out when kitchen staff emerged still holding knives.

 

image001


Oddly, when the proportion spent on social security levelled off in the 1990s, crime turned the corner and began its long decline.

[http://www.ukpublicspending.co.uk/spending_chart_1900_2015UKp_12c1li011mcn_40t and Department of Works & Pensions]

 

image001

 

Unemployment surged from 5 to 8 per cent and almost all pundits and criminologists predicted crime would zoom back up.  They were wrong. Almost every category of offending continued its downward profile.

Although this had been predicted by the author the apparent paradox baffled criminologists and commentators, with some newspapers publishing all sorts of theories for the trend – but at last, after 25 years of persistent falls in crime, the fact that crime was falling became almost universally acknowledged by the news media. Police recorded crime and victim surveys concurred: Crime in England Wales, year ending March 2013, Office of National Statistics, 18th July 2013. [www.ons.gov.uk/ons/rel/crime-stats/crime-statistics/period-ending-march-2013/sty-crime-in-england-and-wales.html]

Trends in police recorded crime and CSEW, 1981 to 2012/13

 

image001