Social costs of crime

Crime is bad. From a religious point of view, it is clear, no matter which faith, unless you worship the devil. It is a religion too. With it comes various forms of punishments. Secular or religious states punish crime and condemn it. Societies, functional or dysfunctional, naturally demonise crime. Parents raise families and teach their children about the dangers of crime.

No matter how you want to view crime, with it comes a lot of costs. Costs that go beyond the direct victims or criminals that experience the wrath of the law, but the society as a whole.

Think of lost opportunities that societies lose to rampant crime. One can think of violent criminal acts in war torn countries and how normal life is disturbed. No schools or businesses have to pay high costs to extortion by gangs. Prices rise and the basic costs of living rise. The investor is kept away.

Such are the social costs of crime. Crime kills creativity or at least instills a fear in minds that are daring and want to achieve great things. The scare that one will loose everything is not worthy getting your idea into a project.

It is for this reason that potential investors always pay attention to the level of crime before committing their money. Often, they are   worried by the security of their investments and the lives of their staff even their families. These are all lost opportunities if a country is caught in huge wave of crime and must be viewed as social costs to our society that remains trapped in chronic poverty.

Opportunities lost include jobs and the overall welfare of   consumers that have to pay for higher prices of goods due to lack of choices. The lost tax revenue is another way to express such a loss. Any investor that avoids the country as a result of perceived insecurity is lost tax payer.

It is revenue that could have gone to provide basic services such as electricity, education, health, environment protection, sanitation and social security amongst others. Meanwhile such lost revenue goes to other countries that invest it good health systems that a tiny fraction of our elites can access, some using the poor people’s taxes.

The costs do not end with lost potential foreign direct investment (FDI), but can also be   reflected in how we can make concessions on potential foreign direct investment deals. Any perceived high risk on foreign investment such as the presence of crime in any form weakens our negotiation position. A foreign investor negotiating a tax concession on their business can have a strong leverage point in such environments.

Naturally it is very tricky to force such an investor accept your terms because their bargaining chip is the crime and the insecurity perceived that a tax credit must absorb. So all this trickles down to how the society is affected from potential sources of tax revenues that can take care of social amenities and improve the quality of life in general.

It is just one side of crime. Not all crimes are violent. White collar crimes are non-violent, and involve smart manipulation of systems to the benefit of its perpetrators. Nonetheless, the cost and effect on society are similar. White collar crime, just like violent crime, generates a negative perception. Such perception is reflected in a country deemed unsafe for visitors or long term investors. So each time one looks at the level of unemployment, especially among young people, crime as a cause should not be ignored, even though it may not be the sole reason.

From the perspective of investors shunning Malawi as a destination, purely on weak rankings of ease of doing business that has crime perception as a key element. There are losses in jobs that could have been created.

That is why our youth are flocking down south and we have had to pay using taxpayers money to get them back in the wake of xenophobic attacks. These are social costs that we all have to absorb even though they are perpetrated by the elite that have a malignant appetite to abuse positions of trust.

As we grapple with a weak Malawi kwacha and the high cost of living for the average person, one can reflect on the costs of white collar crime to society. The pictures of people surviving on mangoes must shame all those individuals that have rooted our treasury for many years.

The empty hospital pharmacies and the many deaths in our hospitals, the patients that beg for food to survive. Lives lost at their prime because public facilities cannot provide care. They are also social costs of crime.

It took a few white collar criminals to siphon billions of tax payer funds. As a result, of their actions, traditional partners have been withholding their support which is very critical in cushioning our balance of payments amid dwindling export revenues.

On the   part of the society, this has resulted in reduced resources to critical public services with   hospitals and education absorbing the most. It is how crime costs societies, huge cost to be precise. n