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> There is an argument for indexing fines to income or net worth for people too (in addition to severity of the crime) -- if you want to stop a behavior, for example speeding, it doesn't make sense to set the fine equal for everybody unless wealth distribution in society is remarkably flat, so the marginal value of lost money is similar for everybody. If you don't index for ability to pay you just create a separate set of laws for different classes of people.

The issue is that stopping the behavior is committing to a bad abstraction.

Cars can kill people even below the speed limit. If you drive faster, the probability goes up. That is an externality, because you put others in danger in addition to yourself, regardless of which speed it is. In principle what you ought to do is price the externality. You create some amount of risk by driving a mile at 50MPH, so you're charged a proportional amount for that. The risk created by driving at 70MPH is more, so the charge should be higher, proportional to the higher risk.

But that would require monitoring the speed that every car drives every mile and billing for it. Until recently that wasn't even plausible and even now it would be a huge privacy invasion. So instead we settle on choosing some speed, ignoring the cost of anyone driving slower than that even if its true cost is non-zero, and whacking anyone who drives faster with a disproportionate fine to compensate for most instances going undetected.

Committing to deterring all speeding at any cost is completely ignoring why we're doing this to begin with. We don't need to eliminate all risk -- that would imply eliminating all cars and other vehicles and in practice isn't possible even then.

What we need is to throttle the risk so that it remains at a manageable level. Which is exactly what pricing it does. That's true whether you're doing meticulous risk accounting or using blunt stochastic methods like speeding fines.

And when you price something, rich people buy more of it because they have more money. If the price you've assigned to the risk is actually proportional to the cost being imposed by taking it, you really don't need to stop them. Just let them pay for the risk in money. Then use the money to pay for safety improvements or compensate victims or whatever you like -- if the amount they're paying is properly proportional to the risk then you come out better off this way than by actually deterring them.

> This is basically the same argument as for progressive taxation.

The argument for progressive taxation is that we're not trying to discourage behavior and the rich are better able to pay, so charging them more will have less detrimental effect because it will have a lower impact on their consumption. It's more about taxing the poor less than taxing the rich more.




"when you price something, rich people buy more of it because they have more money. If the price you've assigned to the risk is actually proportional to the cost being imposed by taking it, you really don't need to stop them. Just let them pay for the risk in money. Then use the money to pay for safety improvements or compensate victims or whatever you like..."

So don't try to stop rich people from driving drunk and killing people, for instance? Just let them do it and then pay off the victims and the victims' families?

Is that really what you're suggesting?

Somehow I suspect you'd reconsider if someone you cared about was killed in a DUI accident. No amount of money can bring them back.


You're just committing to the bad abstraction again. Driving drunk is worse than speeding by exactly the amount that it increases the probability that you hurt someone. Which in that case is a lot, and so the fine should be proportionally a lot higher.

"You can't bring them back" isn't any less true for someone who kills someone driving 65MPH in a 55MPH zone -- or 55MPH in a 55MPH zone. The only difference is the probability, which is a difference in quantity rather than kind.

> No amount of money can bring them back.

Neither can it bring back the person hit by a bus because the government didn't have that money to spend fixing a bad intersection. Should we really let two families lose loved ones to that intersection when they could be saved with the money that not deterring a risk taker generates, even if that risk ultimately kills one person? What about the family who lost someone but the compensation allowed the survivors to live somewhere safer or afford better medical treatment and that saved someone else?

What you really want to be arguing is that we should never be trading money for lives. Everyone viscerally feels kind of that way. But that doesn't work. There is always a marginal safety improvement that would save additional lives in exchange for additional money. Any time you choose a smaller number of lives over a larger amount of money, what you're really doing is choosing a smaller number of lives over a larger number of lives.




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