Police State

May 2, 2008

Let’s recap: Michigan’s economy flat-out blows.

And Michigan spends $2 Billion on its Prisons, annually. Is crime really 400% worse than it was in 1983? Are the police really 400% better at apprehending criminals than they were in 1983? No, and no. The state is simply locking up more and more people for minor and typically non-violent offenses. The Detroit News reported:

• The 50,200 inmates in Michigan prisons represent a four-fold increase in the number of prisoners over a quarter-century.
• One of every three state employees works in the Corrections Department, up from one in 10, 25 years ago
• The cost to house each inmate drains $31,325 annually from the state treasury.

The real effects on Michigan’s economy are probably probably much greater, since one in three State employees are in the Corrections Department, meaning that whatever income they “earn” has zero economic value. Also, if we consider that the prisoners would be earning taxable income, the real hit to the treasury is probably closer to $40,000 per year—just to keep them locked up.

Interestingly, these inmates cost the state more money than they would probably contribute, en masse. By virtue of being incarcerated, they’re earning $0 annually, which is may be conservatively estimated at $20K-$30K less than they would otherwise make. This is a real diminution of the State’s productive capacity, in the neighborhood of at least $50k or $60k per inmate: $31,325 of other people’s money plus whatever income the prisoner would earn, if freed.

When we consider some other intangible effects of such a police state, predominately the decimation of the family unit, the scene becomes even more bleak. By removing one income from a family which probably required two incomes to begin with, financial hardships are exacerbated, and the strain on social services like welfare programs, aid to dependent children, etc., increases.

My guess (and it is only a guess) is that each of these inmates costs the State in excess of $100,000 annually, in terms of real wealth.


Posted in: Economics Lessons, Police State, localized

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