With our 3.5 Trillion Dollars, Should We Fight Crime or Poverty?

With our 3.5 Trillion Dollars, Should We Fight Crime or Poverty?

What should we do with all of our money?

There are two big things in the news right now. First, the Republicans and the Democrats are having a friendly discussion about how to spend all of our money. This includes Biden’s Build Back Better agenda with a 3.5 trillion dollar spending bill at hand. As is the American tradition, the opposing party is creating roadblocks to raising the debt ceiling in an effort to retain leverage. As far as the other topic goes, I don’t remember what it was except that I understand that there is maybe some virus on the loose or something. (JK)

One story of lower billing is about recently released reports from the FBI. The agency is reporting that 2020 homicides increased by nearly 30% over 2019 numbers, the largest jump we’ve seen since the 60s. Those totals are rivaled by the violence of the 90s, but at least we had grunge music to fall back on when the world was on fire. [1]

[1] Disruptive footnote: Billy Joel said we didn’t start the fire, but he might need to revise his position since climate change evidence demonstrates overwhelmingly that we actually did.

This significant increase in murders is jarring, and of course, the pundits are going to blame whatever or whoever are their sworn enemies. Some will blame the war on drugs, while others say we are not policing enough. Everyone will blame Caronavirus, and why wouldn’t you? Covid-19 is not running for office in 2024 so it serves as a great fall guy.

The great year of 2020 was supposed to be an amazing year for most of us. Unfortunately, it turned out differently than most people expected. Besides murder, we had wide swings in other stats as well. We had big gains in the stock market, people getting rich on cryptocurrency, intense racial activism, and significant unemployment rate swings to name a few.

If you’re reading this, I have good news. You were not murdered last year. Because of that, it is easy to put this stat in the out-of-sight, out-of-mind category. Murder may be the canary in the coal mine that points to other issues. It would be intellectually dishonest not to examine other swings and consider whether they impacted what is hopefully an anomaly. I’ll start with three of them.

We’ve had an increase in poverty.,

According to the Census Bureau, poverty has climbed for the first time following a five-year decline. If you’re not poor (and you’re probably not), you may think this is not your problem, but like that dead canary I mentioned earlier, you’re not going to be able to ignore it for too long.

In 2020, there were about 3.3 million more people in poverty compared to 2019 data. The number of children living in poverty grew substantially. During the heat of the pandemic, poverty was at its worst, at least temporarily with unemployment hitting as high as 14.8 percent at its peak, wiping out job gains that Trump has bragged about delivering even if most of them happened before he was in office. The current rates of unemployment have recovered much of that loss. At just over 5 percent while I am writing this article, that’s still 2% worse than January 2020 rates.

While 2020 was on tilt, racial tension flared up following the murder of George Floyd at the hands of police officers. This incited riots against police brutality all over the country, which of course resulted in some crime in the process. For a while, the subject of race and racism in America was the only break from media coverage about Coronavirus. Since the rate of poverty amongst black people is substantially higher than that of whites, we can’t set this aside as a separate topic.

Poverty is often a trap for those inflicted by it, and the instability of poverty can actually cause trauma affecting people’s health. Despite the number of times, the well-off suggest working hard or pulling up one’s bootstraps, exiting poverty can be one of the most difficult economic achievements due to the inherent limits on the poor, especially those subject to racial inequities.

We also had increases in wealth.

Some people were sharing memes about 2020, but on the inside, they were saying thank you because they got to work from home, their 401K increased, and home values increased substantially. The wealthy are doing especially well because they had a prime opportunity to acquire assets while others struggled to keep theirs.

The wealthy have grown their wealth by large margins. The BBC pointed out that over 5 million people across the world became millionaires during 2020. This is encouraging for the wealthy but less so for the poor, who have become poorer during the pandemic, with the total number of people added to the poor list in the US alone at over 3 million.

Billionaires have seen some of the most notable gains, amounting to 62% increases in wealth. That increase of about 1.8 trillion dollars. What makes wealth great is that you can avoid taxes a lot easier while enjoying the buying power you are afforded through the instruments of your wealth. The ultra-wealthy keep most of their wealth in stocks and often borrow against their wealth to avoid triggering a taxable event (sort of like living on a home equity loan). This means that billionaires are able to legally reduce their taxes and pay a lower effective tax rate than the average American with a job. I saw one comment on Twitter “Unrealized capital gains is not income.” and this is a point well taken, but I won’t dive into this in detail in this article. The truth is, when you control the private jets, corporate meals, asset acquisition and fringe benefits of companies you own stock in, you don’t need to realize gains to benefit from them.

Before you place me on whatever far end of a political spectrum, it is not my intention to address or debate a policy about taxes on capital gains. My point is simply this:

The poor are poorer, and the very rich are now very very rich.

Gun sales are on the rise.

In 2020, gun sales rose by 40%, equaling about 40 million guns bought legally. This is about one new gun for every five adults in the United States. This trend has continued into 2021, with all-time record-setting sales. This isn’t an anomaly, though, as gun sales have been rising since the FBI began keeping records in 1998. Still, perhaps civil unrest has encouraged more gun sales.

It should go without saying that guns don’t kill people; people kill people, but it should also go without saying that a comment like that is naive.

The United States is the country with the most guns in the hands of its citizens. We happen to be in second place for most gun deaths by country (and 9th place in the world if you adjust for population).

Gun deaths increase dramatically with easy access to guns, including completed suicides and accidents. When it comes to 2020 murders, about 77% of them are gun killings. When it comes to gun crime, anyone could become a victim. The most likely victims of crime are people with incomes below the poverty line and those who live in impoverished neighborhoods where crime is rampant.

Studies have been conducted to see whether citizens are safer when they carry guns for personal safety, and the findings between two landmark studies show conflicting results, seemingly aligned with the ideology of the agency commissioning the study. The answer to the gun crime debate is a complicated one. While there are several policies that have been shown to reduce gun violence and, in particular, deaths, it’s hard to identify what law will prevent murders when murders are already disregarding the law.

The best way to reduce something is to make it unpopular or unnecessary.

Crime and poverty are bedfellows.

While the large majority of murders in 2020 were gun murders, removing guns just makes murder more difficult but does not address the actual problem at hand. Guns are only a single factor in the steep increase in murders last year. When a murder is committed, there are many more things taking place, and gun regulation is not a silver bullet (sorry) to reduce murders. In fact, it’s hard to see what consistently reduces crime when increasing policing can sometimes backfire, and have a negative impact instead.

Some claim that the criminal justice system fuels crime, and that makes sense, but evidence also shows that policing is essential for addressing and reducing crime even if it’s a complicated balance.

Fortunately, murders have not continued at the same pace in 2021 as last year's 21,500 victims. This is not the case for cities like Albuquerque, Des Moines, Indianapolis, Memphis, Milwaukee and Syracuse who recorded their highest homicides ever, but nationally, numbers are down from last year.

One thing that we always see alongside crime is poverty. Crime of all types is highest in the poorest of neighborhoods, and most incarcerated people come from impoverished lifestyles.

Addressing poverty is addressing crime.

There is usually a link between poverty and crime. One report studying Arlington, VA and Garland, TX concluded that “raising the income levels will lead to positive changes in crime and result in a lower crime rate” and multiple credible studies posit something similar.

So policing is necessary, but it doesn’t have the impact that raising incomes does. Even if it did, it would be at the risk of the officer's lives, and at times, they may be too late. Police department funding is generally the largest share of the budget in 35 of the 50 largest cities, not counting the rest of the criminal justice system. So, are we spending our money wisely? How would you rather spend your money?

  • Militia?
  • Prison?
  • Housing?
  • Education?
  • Income assistance?
  • Increasing minimum wages?

What we know is that the economic stress of 2020 has calmed, and many poor and middle-income families have received funds back from the Government aiding their financial stability. Crime levels have followed suit. Studies seem to show that raising incomes and reducing inequities reduce crime. This would mean that we would have to give out “free money” to people who have “not earned it” (pardon the square quotes). If it reduces crime, it will benefit the economy, which might be worth it to all of us. The billionaires who have worked “so hard” for their money will in turn benefit from it as well.

Currently, as the Government is trying to figure out how to spend all our money, perhaps we should look at the long-term outcome of our investments in the economy, not just for our wealthy donors. Alexandria Ocasio-Cortez is singing “Tax The Rich”. Some would say that taxing successful people even more than they already are would be a crime.

So, what do you think? Should we fight crime or poverty?