John Quiggin wanted to condition his bet with Bryan Caplan regarding European vs U.S unemployment on including the imprisoned as unemployed. There is a certain logic to that, as there is to saying the same of people engaged in make-work*. Quiggin’s logic reminds me of the radical economist Samuel Bowles on “guard labor” and Marx’s “reserve army of the unemployed”. As Caplan notes, the question seems to hinge on whether these people would be unemployed if they were not in jail. This is a question people like me who favor repealing all laws prohibiting acts of capitalism between consenting adults should grapple with. Apologists for the war on drugs like Chris Roach and The Man Who Is Thursday(?) sometimes claim that in the absence of drug laws all those convicted of such crimes would still be committing other crimes for which it would be harder to convict them. I’ve mentioned earlier that I think it is a good deal harder to go after consensual crimes because there is no naturally cooperative source of information and assistance (which was enough to pay for the provision of law before professional state justice systems, as detailed by Bruce Benson), but here I should admit that to a certain extent we can view these laws as compliments rather than substitutes for police & prosecutors that we presume to be actually focused on the most dangerous criminals but opportunistically using drug laws when available. In my own opinion I don’t think that’s a realistic portrayal of law enforcement behavior, and that measuring success in terms of drug supply disruption (which usually just destabilizing the market and induces another violent round of king-of-the-hill) indicates that they are trading off against other priorities.

I am willing to admit that there is a very high unemployment rate among people released from prison. They are even deemed “unemployable”. This could indicate problems with releasing large numbers of people, if not avoiding locking people up in the first place. Mark Kleiman notes that participants in the H.O.P.E program easily attain employment despite being ex-cons on parole, but this is because of a coercive monitoring authority ensuring they always behave according to plan or face swift & certain punishment. In a hypothetical were large numbers had not been jailed for drug crimes in the first place (or in our most likely future where whichever pet program that has our focus is not implemented) that effect would not exist. While I think that relatively speaking the sorts of people that wind up in prison will not become Horatio Algers if their lives had not been ruined by a cruel justice system, the combination of low rates of imprisonment with low rates of unemployment in the past indicate to me that we don’t necessarily have to choose between one and the other. Admittedly, some things have changed since then like the continuing shift from rural to urban living and from an agricultural to service-based economy. Nevertheless, the huge drop in crime (which had been unusually high at the time) with the repeal of prohibition indicates that repealing bad laws can have a large effect. Former bootleggers deprived of their previous source of income even in the midst of depression did not have to resort to other kinds of crime. It should be noted that slinging crack does not pay better to most involved than working at McDonalds, and the poor may be thought of as irrational actors committing many crimes that don’t pay. That may well describe their greater tendency to drive drunk, but the massive gang warfare currently going on in Mexico (similar in many respects to the prior American “crack wars” but on a much larger scale) requires a degree of motivation, coordination and funding that only large profits (even if not for the foot-soldiers) can accommodate. Gangs existed in America prior to crack, but they were more prone to making threat displays on their corner “turf” (which was not much of a source of funds), with the leaders dropping out as they grew up to make room for their juniors. Furthermore, they were typically not armed with guns (excepting the occasional zip gun). The drug trade provided both motivation and means for gang warfare.

UPDATE: This from the Boston Review is full of mockable left-ese but gets at the issue of changes in the economics of labor and imprisonment. Charles “Radgeek” Johnson writes in The Freeman about the fate of our urban underclass in a freed market.
UPDATE: Megan McArdle’s response to Quiggin is highly relevant to the issues discussed here.

*I emailed (I can’t comment because I am banned) the following to Caplan regarding that post: I’m naturally sympathetic to to Murphy & Higgs take on the New Deal & WW2. I don’t know if I can go all the way in discounting the people with “make-work” jobs. In a country like the Soviet Union where there is no private sector, everyone may be said to do “make work” but it doesn’t seem correct to say they have 100% unemployment rates. To the extent that the public sector is doing a job they private sector would have done anyway and is thus crowding it out, it doesn’t seem we should treat it differently than in the counterfactual where those were private sector jobs. The trouble is evaluating whether public work is “worth doing” (Marx’s phrase I believe was “socially necessary labor”), which for radical subjectivists may be impossible.