The Relationship between Economics and Crime

When it comes to crime, there seems to be a very distinct relationship between it and the economy. Take any major disaster, or breakdown of civil society, and there have been huge spurts in crime. For example, after Katrina hit New Orleans, people were going crazy, trying to find whatever they could, and hope that nobody noticed. Why did people resort to looting in the aftermath of the hurricane? Well, its because they had almost nothing, and had no choice but to take what they needed.

When you have no money, and you have no resources, you have no bargaining power. You have nothing to give in exchange for the goods and services that you will need in order to survive. If you have ever seen the movie John Q. where Denzel Washington plays a man who holds a hospital hostage in order to get his son a life saving surgery, you know what I mean. When people have nothing, they resort to just taking what they want.

It is survival of the fittest, and it doesn’t matter that we are the top of the food chain. We have to survive too, and so when we can’t get what we want, we will take what we want. Did you know that gangs were first started by groups of roving orphans, who would pick the pockets of unsuspecting people in the middle of the night, or in the busy streets? They did so because it was the only way they could obtain money, or other things they wanted.

Organized crime is lucrative because it offers a lot of money for not a lot of work. Who wouldn’t want to live a large life, and have all the girls they want, and the money that they want too. Instilling fear into the local community, and bribing the police, so that even they are living a good life, is a good way to coerce people into giving you what you want. It isn’t so much in this case that people are committing crime for the money, but that the money available for a crime, or by looking the other way is profitable.

When the economy is good, the petty crime rate tends to go down. If you have the money to buy those sneakers, why do you need to rob someone for it? Why risk going to jail over something you didn’t need to do. On the other hand, what about white collar crime?

When the economy is good, stocks are booming, and everyone is making money. That makes people easier to dupe, and to con out of hard earned money. If someone assumes that a stock option will still be there in a few years, and the company is making money, no one is really going to notice what the CEO is doing with the money off the top. However, when the economy drops, all of a sudden a huge scandal can come about.

Think of Enron, AIG, Bear Stearns, and all the other companies that were supposedly safe. Think of Bernie Madoff, who scammed people out of almost 50 billion dollars. Investors lost so much money, and a lot of people are out of a retirement fund due to the greed of people who leeched off the trust of others.

Crime will always be around, and it will usually have to do with greed, or finding needed resources. If a person has nothing, and doesn’t think they can attain it legally, they will usually just take it. On the other hand, some people are just greedy, and want to keep funding the lifestyle they need, either through force, or through fraud. It is unfortunate, but there will always be those out there looking for a quick buck.