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Fees, Fines, and Debt: Governments and Companies are Jailing Poor People

The rising fee amounts and scale of collections are often driven by struggling states’ and cities’ efforts to close their budget gaps.

  • Inimai M. Chettiar
August 22, 2012

Crossposted at ThinkProgress

This week’s St. Louis Patch dispatch reported this story:

Wakita Shaw’s troubles started with a $425 payday loan, the kind of high-interest, short-term debt that seldom ends well for the borrower . . .  Shaw was surprised in May of last year to hear that the St. Louis County police were looking for her. She and her mother went to the police station. They arrested her on the spot. They told her the bail was $1,250… People do go to jail over private debt. It’s a regular occurrence in metro St. Louis, on both sides of the Mississippi River.”

Last week, a San Diego paper covered how motorists given speeding tickets for $35, actually end up owing the state $235 (including a criminal conviction fee, state court construction charge, and DNA identification fee).

Similarly, Ricardo Graham was incarcerated in Rhode Island for 40 days because he couldn’t pay court fees. He was jailed and held for a bail of $745 – while the state paid $4,000 to incarcerate him – and lost his job due to his imprisonment.

Across the country, states and local governments are raising and aggressively collecting criminal fees and fines (including court fees, jail stay fees, and even public defender fees). Often, failing to pay these fees lands people in jail. Courts are supposed to hold hearings to determine whether a person has the means to pay before punishing them for nonpayment. Instead, courts are bypassing this key constitutional safeguard and simply jailing those who can’t pay their fees.

At the same time, private companies and collection agencies are increasingly using state courts to collect civil debts (like loan payments and medical bills). They file lawsuits against debtors and often fail to serve them with notice of court dates or intentionally serve them at incorrect addresses. When debtors do not show up, agencies procure arrest warrants from courts, leading to incarceration of the debtors. Bail is usually set at an amount equal to or higher than the original fees and fines they defendants couldn’t pay in the first place. All this has amounted to a return of debtor’s prisons, which the Supreme Court has found unconstitutional.

But what is really going on here? The North County Times puts it best: “a quest for revenue.” The rising fee amounts and scale of collections are often driven by struggling states’ and cities’ efforts to close their budget gaps. Meanwhile private companies are attempting to procure their lost profits from the poor. These fines are an effort to raise revenue of a few hundred dollars in the hope of trying to close millions of dollars in budget gaps or lost profits. These types of fiscal policies are unsustainable, irrational, and just plain bad economics. Having taxpayers foot a bill of $4,000 to incarcerate a man who owes the state $745 or a woman who owes a predatory lender $425 and removing them from the job force makes sense in no reasonable world.

But legislators find it more politically acceptable to increase criminal fines than to raise taxes. Many also find it more politically acceptable to send more and more poor people to prison rather than to invest in impoverished communities to offer individuals a way out of poverty. With this type of policymaking prevailing to overcome the Great Recession, it’s no surprise that the number of Americans near or below the poverty level has reached an all time high. Americans can only climb out of economic turmoil with policies that make economic sense – for all of us. Charging poor people insane amounts of fees and then imprisoning them when they can’t pay is definitely not one of those policies.