Crime Does Not Pay, It Costs!
Not a single day
goes by without people in Guyana wondering with almost morbidly ghoulish
fascination what the next daring crime to be committed is going to be. From
daylight gun battles to murder, armed robbery, kidnappings and carjackings
there appears to be nothing too outrageous for the criminals to attempt. We
are being told that these incidents are the handiwork of escapees from
prison who appear to be so elusive that they are able to perpetrate their
acts and then vanish until the next time. Our undermanned law enforcement
officials seem impotent in the face of this crime wave and one cannot help
but feel, yes helpless, and exposed while the entire nation is held to
The current wave is
neither accidental nor separable from the deterioration in our law and order
capability and will over several years, and from our willingness to accept
lower standards across society. Ever since the mysterious death of Monica
Reece, the organisation Guyanese Against Crime (GAC) had called for a
complete review and re-organisation of the Guyana Police Force with such
external assistance as might be necessary. As is the case with so many
initiatives by civil society, those calls were rudely ignored and the Force
continues to have the same structure and culture that led to its
establishment in the colonial days – to keep the natives in check!
Even as we seek
economic growth and social development we begin to realise that law and
order and the discipline out of which the concept derives, are prerequisites
for the development of any society. Not only does law and order bring
significant benefits to a country, but it is equally clear that there is a
substantial cost arising from the level of lawlessness which the Mashramani
Day prison escape has brought into stark reality but not created.
Putting a precise
price tag on the cost of crime and lawlessness is impossible since these are
concepts that are often clouded by contemporary political and social views.
Robbing the state by way of tax evasion is as pervasive as it is criminal
but is hardly treated as such even by those who carry the responsibility for
dealing with it. Money laundering, corruption in the public sector often
with the full participation of those in the private sector, insider dealings
by company directors profiting at the expense of shareholders and the state
through another level of tax evasion are as criminal as the employee who
steals from the company or the act of cattle rustling.
After that hurdle
comes the question whether we consider only the direct cost of crime, or the
indirect costs as well. Those who smuggle goods into the country paying no
duties or underpaying in collusion with the Customs soon put their
law-abiding counterparts out of business and discourage others from the
sector. And as Dr. Ashni Singh, Budget Director said recently, money
laundering can “have significant influence on currencies, market prices
and financial stability”
gravity and significance of certain crimes such as tax evasion, corruption
and money-laundering, the fact that the state agencies seem powerless or
unwilling to deal with them and the tolerance by society allow them to pass
unnoticed and to be relegated on or indeed from the scale of crimes. On the
other hand, those crimes which involve guns, kidnapping and injuries to the
persons make news and are seen by citizens and foreign investors alike as
the real threats to their staying here or coming into Guyana.
By their very
nature, criminal activities regardless of whether they are white collar or
any colour, are not susceptible of measurement and in Guyana where there is
no culture of statistics and record-keeping, the situation is really worse.
In the United States studies have been carried out on the cost of crime to
society and an amount of US$1.7 trillion per year was identified prior to
the terrorist attack in the US on September 11, 2001. Supporting this
estimate, David Anderson in the Journal of Law and Economics, gave the
components as: Crime induced
production $398Bn, opportunity (time) costs $130Bn., risks to life and
health $574Bn. and transfers $603Bn.
The study covered
defined as “crime induced production” such things as the money spent on
locks, safes, surveillance equipment, jails, computer security, airport
security, guard dogs and drug trafficking and medical care for crime victims
and children born with drug addictions.
The study then goes
on to quantify time spent by people securing their possessions, time spent
by criminals committing crimes and sitting idle in jails and work time lost
by victims and by neighborhood watches. Then it identifies direct related
costs of injuries and deaths resulting from crime. Next come transfers which
includes items such as fraud, tax evasion, theft, and other cases where
criminals benefit from illegal property transfers. Some of these same costs
are not unique to the US and can easily be associated with crime in Guyana
although obviously on a much smaller scale.
It is true that the
whole security industry which has been spawned largely to respond to the
fear of crime and the real or perceived deficiencies in the Police Force,
and the relative comfort of security allows one to operate at a more
productive level. The fact is however that those resources can only be
considered productive in the widest economic sense since the country would
surely have benefited more if these resources were deployed in
creative/productive activities. The study of the economic impact of crime on
the society is significant because it identifies the drain on resources
directly and indirectly associated with the prevention of criminal activity.
Much of the
so-called crime induced production is for items that are not made in Guyana
whose only value, (important though that is) is as a deterrent or detective
tool. Each dollar spent on this is a dollar less spent by the individual on
food or by the businessman on upgrading his business assets which could in
turn provide employment and tax revenues. Therefore there are substantial
benefits that are not created or are foregone by resources being absorbed by
crime-related products which though providing some employment and profits
are in effect a loss to society.
There is also the
high cost of crimes against property in instances of arson and crimes
against persons, which it is argued results in the unnecessary production,
creates a demand for already scarce resources and drives up prices overall.
For instance insured items which are destroyed can result in increases in
insurance premiums on two counts. On one hand because of the deteriorating
claims experience insurance companies’ expenses are driven up and they
pass those onto the consumer. They also wish to be compensated for their
increased risk of an eventuality, which is an issue of underwriting cost
rather than actual cost, and therefore increase the rates that the public is
asked to pay for coverage.
In Guyana the
impact of crime is much more far-reaching than in the United States because
of the stage of development or underdevelopment at which we find ourselves
at this time. Migration accelerated in the seventies when our political and
social experiments created much hardship for most people. A large percentage
of the remaining population is therefore awaiting that coveted visa to the
US or Canada and the increase in crime will drive even those who were
contemplating staying in Guyana into leaving. Occasionally a few stories of
the achievements of some of our best and brightest native sons and daughters
sometimes filter back to Guyana but many others do not. The brain-drain is
for real and continues to be so and that cost is unquantifiable but
trickles down because the shortage of human resource skills creates a
vicious cycle which hinders development and further creates a situation that
does not attract those other resources needed to promote development. Our
politicians all say that we need to attract investment but which rational
person is going to invest in a country that seems powerless to control its
criminals? So crime has a doubly debilitating impact by driving away the
talent that persons seek when thinking of making investments and by scaring
off investors worried about their personal safety as well as the security of
For years now we
have heard the cry that we are not attracting sufficient investments in the
economy despite having one of the most liberalised economies in the region.
Given our mindset, we think “foreign” whenever we think of investments
but the fact is that even Guyanese entrepreneurs are now de-investing in
response to the whole range of what seem to be insoluble, perennial problems
now compounded by an uncontrollable wave of crime.
While there are
many reasons which deter the investor including the cost of doing business
here, the state of our courts and an uneven playing field, the daily menu of
crimes splashed across our newspapers has a salutary, negative effect.
The crime situation
has passed the crisis point and we still do not seem to have any idea how to
address it. We appoint a person to the post of Commissioner of Police and
then do everything to demoralise him. As a society we treat poverty as a
crime when he real crime is poverty. Political parties accuse each other of
being terrorists, each claiming to stand for law and order while
simultaneously engaging in political point-scoring. Despite escalating
criminal activities we ignore calls to modernise the Guyana Police Force.
We treat some
crimes such as tax evasion as perfectly acceptable while disproportionately
dealing with other crimes. The drug mule is jailed while the master is
flaunting wealth. Public and private sector governance create a crisis of
confidence against all in authority and yet we expect respect for
institutions including the Police Force.
will we wake up to the reality that a viable future for this country is now
at stake and that crime costs, not pays?