
Silicon Valley’s ugly rich-poor gap: What’s the tech world gonna do about it? - jianshen
http://pandodaily.com/2013/07/08/silicon-valleys-ugly-rich-poor-gap-whats-the-tech-world-gonna-do-about-it/
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lsiebert
It's important to remember that this sort of gape has enormous costs, costs
that could be avoided if they were addressed from the get go. When there are
good jobs and affordable housing, crime rates are lower (see
[http://rri.wvu.edu/wp-
content/uploads/2012/12/REU2001-19.pdf](http://rri.wvu.edu/wp-
content/uploads/2012/12/REU2001-19.pdf) ), and there is less need for spending
on security, police, etc. The average prison inmate costs $47,102 a year,
while adding little to nothing to the economy (some prisoners work for less
then a dollar an hour, so they do have some minimal economic output).

That's paid for in taxes. That's a good middle class wage, and could support a
family in the city, or if spent by the government, could go towards useful
services like public transit, or education. Instead it supports one
individual, and doesn't include the value of their lost labor, the cost of the
trail, and other associated costs.

In fact, given that education reduces crime rate (see
[http://emlab.berkeley.edu/~moretti/lm46.pdf](http://emlab.berkeley.edu/~moretti/lm46.pdf)
), and also prepares individuals to work, and given that investing that money
in education, for example, provide a 7 to 10 percent annual return for the
public in terms of increased productivity, and decreased crime (see
[http://www.aft.org/pdfs/americaneducator/spring2011/Heckman....](http://www.aft.org/pdfs/americaneducator/spring2011/Heckman.pdf)
) income inequality ends up costing tax payers quite a bit more then you
actually think.

