The number of people caught up in the U.S. criminal justice system—under either supervision or adjudication—is unusually high in both historical and international terms. Furthermore, interacting with the criminal justice system is an expensive proposition. While people from all walks of life encounter the criminal justice system, its reliance on bail to encourage return after pretrial release, on fines to punish and provide restitution, and on fees to fund the system implies that an individual’s economic means may determine how burdensome any interaction is. Some people can easily post a $5,000 bail, while others struggle or are unable to do so, resulting in incarceration. A $500 fine could be a nuisance or a devastating financial blow.
The criminal justice system also incurs high expenses, with correctional, judicial, and law enforcement expenditures combined costing about $900 per capita each year (see fact 1). Rising expenses, alongside other pressures on state and local budgets, have coincided with some jurisdictions relying heavily on courts and law enforcement for new revenues. These funding sources come in a variety of forms: fees and surcharges, fines, and asset forfeiture (see box 1 for more information). One estimate puts fee and fine revenues collected by state and local governments at more than $15 billion per year (U.S. Census Bureau 2012; authors’ calculations). Particularly in the jurisdictions that rely heavily on such collections, researchers have found that law enforcement activities are distorted by the need to raise revenue, affecting the types of crimes that are policed and damaging the relationship between police and communities. In an idealized criminal justice scenario, the court convicts an offender of a crime, the offender “repays their debt to society,” and then they reenter the community. Unfortunately, this is not how the process works for many individuals. Criminal justice debts often follow individuals after adjudication, in many instances bringing them back into the criminal justice system or limiting their employment options. These debts are considerable: in FY2017, outstanding federal criminal justice debt totaled $124 billion (Executive Office for United States Attorneys 2017). The criminal justice system has also dramatically expanded its use of monetary bail since the late 20th century, which has direct effects on who can avoid pretrial detention, as well as the financial burden experienced by defendants and their families. Through its effects on detention, the imposition of monetary bail tends to increase recidivism and impair subsequent labor market outcomes. These are important costs in conjunction with the intended benefits of monetary sanctions: compelling appearance in court, deterring and punishing crime, and making restitution to victims. Policy discussions are beginning to acknowledge the economic and social consequences of monetary sanctions, and a growing body of evidence indicates that sanctions could be realigned with their public purposes while minimizing their harmful consequences for those interacting with the justice system. This Hamilton Project document aims to establish facts relevant to that policy discussion and thereby promote broadly shared economic growth and more-effective governance.