Tag Archives: incentives

The Perverse Incentive Structure of Missouri’s Conviction-based Drug Testing Compensation Law RsMO 195.003

Missouri law mandates that individuals convicted of a violation of Missouri’s Controlled Substances Act are required to pay the costs of the crime lab test. In practice this implies that the only stable source of funding for a crime lab are test results that help a prosecutor obtain a conviction. As RsMO 195.003 states:

In any case where there is a violation of this chapter, a judge may, upon a finding of guilt*, order a defendant to pay for costs for testing of the substance or substances at a private laboratory.

Further, RsMO 488.029 establishes that part of these costs is a $150 surcharge that is only garnered by the crime lab in case of a conviction:

There shall be assessed and collected a surcharge of one hundred fifty dollars in all criminal cases for any violation of chapter 195 in which a crime laboratory makes analysis of a controlled substance, but no such surcharge shall be assessed when the costs are waived or are to be paid by the state or when a criminal proceeding or the defendant has been dismissed by the court. The moneys collected by clerks of the courts pursuant to the provisions of this section shall be collected and disbursed as provided by sections 488.010* to 488.020. All such moneys shall be payable to the director of revenue, who shall deposit all amounts collected pursuant to this section to the credit of the state forensic laboratory account to be administered by the department of public safety pursuant to section 650.105.

Roger Koppl and Meghan Sacks discuss the incentive structures of forensic scientists in a 2012 paper:

Whitman and Koppl point out that “the very choice to submit a suspect’s sample to the lab makes the lab more inclined (than it would be otherwise) to announce a match, indicating that the suspect is guilty.”  The forensic scientist must evaluate ambiguous evidence, but give, generally, a binary judgment that the evidence does or does not match.  (The explain why the probabilities given in DNA testimony are not usually an exception to this binary nature of forensic-science testimony.)  In this situation, even the most “rational” scientist must choose what to say.  The choice will usually be influenced by scientific analysis done in the crime lab. But if the evidence is ambiguous, as it often is, then two other factors matter even for perfectly “rational” forensic scientists.  The scientist is more likely to inculpate the defendant 1) the higher the forensic scientist’s “prior” probability of guilt, which is the probability before the forensic evidence is examined, and 2) the weaker is the scientist’s desire is to avoid convicting the innocent relative to his or her desire to convict the guilty.

Indeed, these biases when compounded by a financial incentive to assist in conviction imply that no Missouri drug defendant has a fair chance at an unbiased evidentiary process involving a crime lab. It’s time for the Missouri Legislature to protect the rights of citizens to a fair trial by reforming this system by ending the conviction-based revenue collection of crime labs.

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Thoughts on the ontology of Prohibition and origin stories

I was thinking about the notion of Prohibition lately, and realized there was a valuable insight to be garnered from the telling of the Original Prohibition story, or at least the way I see it.

What I refer to as the Original Prohibition, of course, was Adam & Eve’s experiment* with the mind-altering “fruit of the tree of the knowledge of good & evil”. And here is the crux of the story. It is a story about free will, and about how divine and human will interact, and the consequences of your choices.

I have the suspicion that many people (on both the right and the left) receive this narrative and think that the lesson from the story was that God’s Prohibition was not strong enough. It was not strong enough because it did not work to prevent our prototypical human ancestors from making a choice that brought misery and the profane to human existence. If Adam & Eve could have been prevented from eating that fruit, perhaps, the human race would not be in this ambiguous, pitiable state of earthly existence. The divine would be the sole content of human experience, and who wouldn’t want that?

But having the freedom to choose involves the awkward notion of living with the consequences of your actions. Not the false, legal, human-created consequences (at least in consensual actions where there is no victim), but the consequences of living with the knowledge, and the impact of your free will.

I have the sense that people who support prohibitions on consensual, non-tortuous activity really have the mindset that if we can just engineer society to this end or that end that we can prevent all bad outcomes, all miserable outcomes. But this is the worst kind of foolishness. Society is best served by criminalizing tortuous behavior, not non-tortuous behavior. To criminalize non-tortuous behavior is to subsume the notion of free will and human choice beneath the spectre of a glorious and impossible future.

The end result of criminalizing consensual, non-tortuous behavior, is that you create markets and industries that are dependent on the existence of the law and the need for its enforcement and not the real demand for goods and services by individuals. Ultimately, you can criminalize the entire canon of human activity through some extension of the law. The phrase “slippery slope” is appropriate here.

This is the ugly machine of fascism. It is the request to abrogate your rights and your choices for the ever-greater pursuit of security. But it is an ontological abyss. From a vantage point above, one can see the Gulag below, the (in)evitable promise of the Soviet Dream.

*One might replace the Judeo-Christian origin story with any of the many other different origin stories of similar structure and plot for the purposes of this argument.

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Fit to print, or fit to cover-up? Against Karl Miller

Karl Miller writes in his Missourian editorial that he is “siding with Chief Burton” on the manner in which the Dresner affair was handled. Miller has many things to say, but I wish to focus on the mistake Miller makes in describing this situation is as “a purely personal matter”.

It is clear to me that the only “purely personal” part of the story is the love story between Columbia Deputy police chief Tom Dresner and Columbia Police Public Information Officer Jessie Haden. Karl Miller is right to say that this is a personal matter. But official misconduct is not, and unfortunately Tom Dresner is guilty not only of the offense of conducting a secret affair with a direct surbordinate, he is guilty of compromising his integrity as a public servant, and that is a far more public issue that deserves to be addressed. We might ask the following follow-up questions:

  • Did Tom Dresner and Jessie Haden use a motel for their rendezvous, or city facilities?
  • Did Tom Dresner and Jessie Haden conduct their affair on the city’s clock, or did they manage to keep everything for after work?
  • Did other officers know about this affair, which was conducted over a period of at least 7 years?
  • If other officers knew, why did they choose to keep the misconduct of a superior officer under wraps?
  • If other officers knew about the affair, were they ever in a position to put the screw on Dresner to cover up misconduct or to obtain promotions and other favors?

Karl Miller might retort that there is no reason to believe that Tom Dresner and Jessie Haden ever did more than conduct a totally secret affair on their own time and property and that Dresner’s integrity is otherwise intact. Unfortunately, this is not the case either. We have known for years that the police department was structurally dysfunctional; it was only in the last two years that the police had a functional Internal Affairs division, and the only external check on internal misconduct is a toothless and ineffective Citizens’ Police Review Board.

This is the important point. It is the structure of the police department that is our true enemy here, not the individual officers. There are individual officers in Columbia’s police department who deserve prosecution and public shaming, but without reforming the structure of the police department, Columbia will continue to see lawsuits over the conduct of its police officers and the protocols that guide them.



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Why would Columbia Police Department delay the execution of 57% of SWAT search warrants between 2007-2010?

Brennan David at the Columbia Tribune writes:

Columbia’s SWAT team served 106 narcotics search warrants between Jan. 1, 2007, and May 11, 2010. The Tribune, through an open records request, received 99 of those search warrants; the others were considered closed records for various reasons.

Of the 99 SWAT narcotics search warrants granted by the Boone County Circuit Court to Columbia police, officers executed 43 percent of them within hours of being issued. Of those, 65 percent resulted in one felony arrest, and 18 percent resulted in misdemeanor arrests.

But the percentage of warrants producing a felony arrest dropped drastically to 37.5 percent when investigators waited one day before serving the search warrant. In those cases, 50 percent produced misdemeanor arrests.

“This does not surprise me,” Dresner said. “I think the nature of drug sales is that it is a very immediate transaction. For consumers and dealers, once there is a product available, it travels fast, and sales occur very quickly.”

What isn’t being said here is very important. It’s that the police have financial incentives to delay the execution of a warrant, particularly when illicit substances are present. They’d rather serve the warrant when they might find a suspect in possession of large quantities of cash, which they can seize through a civil procedure without the trouble of obtaining a conviction. This is particularly true when cannabis exclusively is involved; it is not a dangerous substance, and complaints relating to its distribution are usually related to the amount of traffic, not the hazard of the plant itself. The proceeds of these seizures can be retained for the Columbia Police Department’s budget through a loophole that allows the federal government to appropriate these seizures and disburse cash and equipment back to the Columbia Police Department. In the last ten years, the Columbia Police Department has received roughly $210,000 from the Department of Justice’s Equitable Sharing Program, though that figure does not capture the full amount of money benefiting law enforcement free of legislative stipulation and civilian oversight. The Missouri Constitution (Article 9, Section 7) mandates the proceeds of these seizures be sent to education, but with the involvement of the federal government and the laxity of legislative oversight this constitutional requirement is circumvented with ease and negligible oversight.

In other words, the Columbia Police Department has for years been pursuing low-level crimes with SWAT raids not for the purpose of making this community safer, but for the purpose of obtaining funding for all the things their budget doesn’t give them. As the United States Appellate Court for the Fifth Circuit said in 1992:

As was obvious at the oral argument of this appeal, each member of the court was deeply disturbed by the actions of the federal and state agents in appropriating Scarabin’s money — candidly acknowledged by counsel for the DEA — actions that would have constituted illicit money laundering if perpetrated by private parties. We were even more distressed by the revelation that those activities were not merely condoned but were actively advocated and supported by officials of the DEA in positions to make and implement policy.

Money laundering indeed. I want to point out that civil forfeiture came into the law enforcement toolbox during the 1980’s, when the government started taking on the Mafia and other large, sophisticated organizations. We forgot, however, that when we went beyond the Constitutional protections against unwarranted search and seizure that our law enforcement stopped acting like law enforcement and began behaving like the criminals they sought to prosecute.

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No budget? No Problem!

Found this brochure for an asset forfeiture conference aimed at state and local law enforcement. The location of the conference is Hollywood, Florida during April 15-16 2009. The brochure advertises a variety of seminars designed to educate local law enforcement about the forfeiture process and how to turn seizeable property into money that goes to law enforcement budgets.

Most tellingly, the brochure starkly proclaims that law enforcement can become self-funding free of legislative constraints:

In last twenty years economists from Oliver Williamson to Ronald Coase famously declared “Incentives matter”. And we are learning that they do matter very much, particularly in terms of how institutions and structures function. If structures like representative democracy need clear and distinction separation of powers to function well (if at all), then they need to happen through incentive-compatible channels. Democracy itself breaks down when executive branch agencies conduct their affairs in obscure and impermeable fashions, obtain funding without regard for legislative stipulation and judicial mandate, and lose the incentives to listen to the communities that they serve.

Because when the federal government helps law enforcement pay their bills free of our consent, we lose the ability to shape the policies that guide our law enforcement. Now federal dollars incentivize law enforcement to prioritize cases and methods that result in property they can seize, rather than prosecute crimes of violence that are less lucrative. We serve search warrants on people who have never been implicated in the least hint of violence with paramilitary squads in the land where Patrick Henry once declared “Give me freedom or give me death”. In Missouri, our legislators and judges told us that crimes where fines or forfeiture happened would be prosecuted fairly and the money given to schools, to help the young do greater things that we can. This is no longer the case, and we are incalculably poorer for it.

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What incentivizes government officials in Madagascar?

The NYT reports:

This accelerated plunder of the rainforest coincided with a military coup in March 2009. Andry Rajoelina, the mayor of Antananarivo, Madagascar’s capital, was installed as president and he has since led a weakened and tottering government that is unable — and perhaps unwilling — to stop the trafficking.

“The government does nothing because it shares in the money,” said Ndranto Razakamanarina, president of an association of Malagasy environmental groups and a policy officer with the World Wildlife Fun. “Many of the ministers think they’ll be in office only three or six months, so they decide to make money while they can. The timber mafia is corrupt, the ministers are corrupt.”

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World Cup Watch: Why are American goalkeepers superior to the Europeans?

From the NYT:

In England, American goalkeepers have become as reliable as tea time. The theories for this are plentiful and speculative: Americans grow up playing sports that require use of the hands. The population of 300 million is bound to produce a high number of terrific athletes. The 6-foot-3 Howard, for instance, was a formidable basketball player at North Brunswick High School in New Jersey.

Bob Bradley, the United States coach, does not subscribe to the good-hands theory. He believes more in the ancestry of role models. In this view, Gianluigi Buffon’s impenetrability as Italy won the 2006 World Cup can be directly traced to the magnificence of Dino Zoff, who captained Italy’s 1982 World Cup-winning team at 40.


Hahnemann said he thought the goalie position was more prized in North America than it was in England, mentioning both soccer and hockey.

“After an N.H.L. game, what does everyone do? Skate over to the keeper,” Hahnemann said. “That sort of respect, they don’t really have over in England. For donkey’s years, they’ve always stuck the worst player in goal. No one wanted to play back there. Part of the reason is, the press is so ruthless with us. Anything happens, and they blame the keepers.”

The situation in England is changing, Hahnemann said, though he thinks Americans still hold a cultural advantage — comfort with athletic individualism. He speaks of goalkeepers and field players as “us and them.”

Hahnemann said: “There’s only one of you. You can’t do it if you want to be like everybody else. We enjoy being a little different. As Americans, we don’t mind that, so we strive as goalkeepers.”

The cultural argument strikes me as the most compelling, though not exclusively. If you’re a keeper in England, especially in the lower leagues, it really is the least glamorous position. It suggests many good goalkeepers are undervalued by a large sector of the market, which means many high status offensive players are overvalued. The implications for teams looking to move up in the rankings are obvious.

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On energy efficiency, conservation, and the behavioral economics of Republicans

I’ve been working on a response to Christine Harbin’s op-ed on Missouri’s green energy sales tax holiday over at the Show-Me Institute. This paragraph particularly stood out to me:

…Acquiring a more fuel-efficient new appliance could also encourage the purchaser to wash dishes and laundry more frequently than before, which means that the overall decrease in energy usage may be much smaller than anticipated — or could even increase. If usage does drop as a result of sanctioned purchases, however, the reduction in overall Missouri energy usage will still be minimal at best unless every Missouri resident purchases a new appliance during the week that rebates are offered.

The assertion that the consumers might respond to increased energy efficiency of course is not a new one, and there is some empirical backing for that claim. This study conducted with Opower suggests that political affiliation may play a role in how consumers respond to these programs. Specifically, conservatives seem to be the single group that increases their energy consumption in spite of (or maybe to spite) efforts to increase the conservation of energy:

In a study evaluating the program’s effectiveness, Opower researchers compared power use before and after the HER reports began arriving, and further compared this change with a group of control households that never received the reports. On average, the HER households reduced their consumption in the months that followed by a little less than 2 percent. Not bad, but probably not enough to save the planet.

Working with the same utility as Opower, Costa and Kahn matched up information on the households in the pilot study to data on political affiliations and a database of past charitable giving to environmental organizations. The economists found that the 2 percent average decline in energy use obscured significant differences in the responsiveness of different types of households to the conservation message. Registered Democrats who give to environmental organizations and live near other liberals reduced their consumption by 3 percent. For liberals who started out as heavier-than-average consumers, the reduction was almost 6 percent. Republicans who live in conservative neighborhoods (and hence had no neighborly pressure to conserve) and had no record of giving to environmental organizations actually increased their consumption by 1 percent.

Why would some energy-conscious Republicans all of a sudden become power hogs? One explanation is that many conservatives don’t believe that burning energy harms the planet, so when they learn that they’re better than average, they become less vigilant about turning the lights off. That is, they’re simply moving closer to what they now know is the norm (what psychologists call the boomerang effect). Costa and Kahn also look for guidance from the patron saint of right-wing fundamentalists, Rush Limbaugh, who encouraged his listeners to turn on all their lights during Earth Hour. Costa and Kahn suggest that ardently right-wing electricity customers might respond to paternalistic nudges by burning more energy, just to thumb their noses at Big Brother.

H/T: MarginalRevolution.

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Why soccer players ‘fake it’ and South Africa 2010

From an article on SSRN titled “Football Most Foul” by William Birdthistle:

Scenes of simulation and outrage are relatively absent from American playing fields less because U.S. sports boast omniscient officials with greater acuity than soccer referees, or because there are no bad calls in America, but because the consequences of any official error are much less harmful. Except in relatively rare circumstances, American referees simply do not wield the power to work a game’s bouleversement with one blow of the whistle. Certainly, it is almost unheard of in the United States for a referee to be able to decimate (in the original sense) one team’s playing strength or to award another team the game’s only score. In soccer, however, a referee’s red card is regularly the most critical development in a match, and a penalty frequently leads to the game’s only goal. Last year’s champions, Italy, will readily attest to this principle. Indeed, so important is the power and personality of a referee that in Italy, media listings for domestic soccer fixtures routinely include – along with the teams, the date, and the venue – the official’s name.

He continues:

The World Cup comprises more nations than either the Olympics or the United Nations. It is therefore a rare, truly global event. Every four years, billions of fans follow the tournament hoping to enjoy the apotheosis of soccer, played by its finest artisans for the highest stakes. Instead, with pressure and finality so palpable in every game, players frequently compete with more calculation and defensiveness than they do in their wildly popular domestic leagues. The current set of referees’ rewards and punishments only  exacerbates the incentives to play in this cynical style. The abiding image of the tournament now is less one of spectacular goals or surpassing sportsmanship and more one of melodramatic chicanery. But if the referees’ tools can be adjusted and their roles thereby relegated, we might look forward to future World Cups in which the beautiful game, rather than the soap opera, plays center forward.

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Against Marcus Bowen on Missouri’s Texting While Driving Law

University of Missouri law student Marcus Bowen addresses recent legislative efforts to curtail texting while driving in his latest Missouri Record column. At first glance, the column looks like an intelligent effort to discuss the issues surrounding this latest driving hazard; a second reading reveals that Marcus, a Republican, has a clear ideological agenda here that clouds his thinking and leads him to some intellectually specious conclusions.

Let me start with the first argument that caught my attention in Marcus’s column. He strongly implies that Missouri Governor Jay Nixon’s signature on a bill prohibiting people under 21 from texting while driving is a ‘publicity stunt’ and not a ‘substantive stand against distracted driving’. The warrants for this argument are that Nevada legislators rejected an age-based ban earlier this year because ‘everyone texts, not just teens’, and that the median age for people who text is 38.

There are some major gaps in the story that Marcus assumes away here. First, an aside: Missouri is the 23rd state implement some kind of texting while driving ban, and one of nine to implement an age restriction. Suddenly, Governor Nixon doesn’t look like he’s after a maverick publicity stunt here; actually, it seems like Nixon realized that Missouri was a little behind a national trend that was worth latching onto. The second problem Marcus runs into here is in how he interprets the statistics available. Since Marcus doesn’t provide a citation for the research studies he cites besides ‘Nevada researchers’, I was forced to use the old trusty Google to verify the numbers. The most likely source of the median age statistic actually comes from a Pennsylvania-based company called Cellsigns; aside from their own research, they also cite Nielsen Mobile as a data source. And it’s true that their research show that the median age of texters is in fact 38. But Marcus fails to ask a key question: does the statistic describe the median age of texters, or does the statistic describe the median age of those people texting while driving? There is nothing to indicate that the study was designed to answer that latter question, meaning that for the purposes of this discussion, the evidence is useless. And what is the use of knowing the median age of texters, anyway? We’re concerned with those most likely to text while driving and discouraging that behavior.

Fortunately, Cellsigns has some useful data that we can extrapolate from. This blog post gives us an age-based breakdown of texters. Most notably, the average number of text messages in the 13-17 demographic is 1742 a month; for 18-24 it is 790; for 25-34 it is 331; and for those 35-44, it is 236. What does this tell us? Most importantly, it tells us that people around 15-17 years old who are just starting to legally drive text an average of 58 times a day. For those median texters who are 38, that number is about 8 texts per day. Those are the meaningful numbers Marcus needs to be looking at. We can continue here and draw some further conclusions. People texting 58 times a day instead of  roughly 8 times a day are far more likely to be texting while engaged in other activities, including driving. And that’s before we even note the massive difference between these two demographic groups; teens and young 20-somethings grew up with technology and feel far less concerned about texting all the time; people who are 38 right now are far less likely to make decisions that fragment their attention span because that’s how their preferences and habits have evolved over time. Additionally, the under-21 demographic is distinguished by worse driving; drivers are less experienced and more likely to make bad decisions. It’s why drivers under 21 are more likely to be in accidents. Sanctioning reckless and imprudent behavior is likely to have some deterrent effect at the margin here which is why it’s a good idea.

Next, I take issue with Marcus’s final conclusion: that banning texting while driving will suck up police resources and provide us with a false sense of security and that a real solution is a ‘comprehensive education program’. The first argument I make is that police resources are already heavily vested in the arena of traffic safety and that passing a law that enables them to write another specific ticket will not materially detract from their ability to enforce traffic laws. Second, Marcus fails to appreciate the nature of economic tradeoffs and opportunity costs. The resources necessary to implement Marcus’s unspecified  ‘comprehensive education program’ have to come from somewhere; that means that we have to choose between funding comprehensive text messaging education services and funding other things, like for instance better crime labs or the license plate scanners that the local Columbia Police Department have been requesting. Where exactly will that tradeoff happen, Marcus? Perhaps you should do a cost-benefit analysis of your proposal before you present it next time. Not to mention that the only two examples of such educational programs you cite are the Welsh police video that’s made the rounds on YouTube and the US Dept. of Transportation video of Governor Corzine advocating seatbelt use. Can you provide me with data indicating how successful these education programs were? I can at least give you an example of where people’s habits are stronger than government warnings and educational programs: cigarette education has been around for decades and there are warnings everywhere, yet as far as I can tell annual smoking related deaths are still in the millions.

And finally, let me leave you with this piece of advice. One of the great conclusions that economists have come to in the past few decades is that incentives matter. Government education is intrinsically a less incentive compatible way to solve a problem than by changing the incentive structures that they face. Not to mention, Republicans seem to take issue with government educational or motivational efforts; anyone who is familiar with the right-wing furor over President Obama’s speech to schoolchildren will understand that Marcus’s idea is much more likely to generate conservative opposition than acceptance.

Edit: I have advocated for a long time that a statistics course and a good economics course be required for law students. I’ve had far too many conversations with otherwise extremely intelligent law school graduates who didn’t understand basic statistical principles and as a result made some rather egregious mistakes in their thinking.

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