The New Debt Prisons
Entrapping debtors betrays the American idea. It must end.
Credit...The Heads of State
Opinion
By Gene B. Sperling
Mr. Sperling was the director of the National Economic Council under Presidents Barack Obama and Bill Clinton, and is the author of “Economic Dignity.”
Feb. 16, 2021
While controversial calls to “defund the police” have grabbed headlines, we urgently need to examine how we fund the police today. The increasing use of excessive fees, fines, and surcharges to fund parts of our criminal justice system is creating punitive debt traps for millions of low-income Americans leaving prison. Many find themselves in an economic prison: prevented from paying down their debts by the debts themselves. Others are so entrapped that they are actually reincarcerated for unpaid debt. Either way, they are denied the dignity of a real second chance — and a fresh start to pursue one’s purpose and to contribute to family, community and country.
Criminal justice debt has garnered growing attention — including today in Florida, where unpaid fees and fines are being used to deny those with a past felony the ability to vote. But what has gotten inadequate attention is the increasing role these fees play in funding our courts and police departments, and how they crush the chances of millions of Black and brown Americans to make a better life for themselves and their families, through what can be seen, figuratively and literally, as new debt prisons.
The fact that 21st-century America is recreating any form of debt prison is painfully ironic from a historical perspective. The United States was, after all, the first major nation to get rid of debt prisons in the 1820s and 1830s and embrace “fresh starts” for bankrupts at a time when “debtors were imprisoned in every country in Europe except Portugal,” according to historian Jill Lepore. Alexis de Tocqueville was to later note that this willingness to not see bankrupts as forever “disgrace[d] made Americans differ, not only from the nations of Europe, but from all the commercial nations of our time.”
This movement reflected a powerful American ideal: It was wrong to permanently shackle a person’s productive potential. As the economic historian Bradley Hansen writes, many came to believe “a fresh start was not only fair but in the best interest of society,” as it promoted both individual dignity and economic growth. “Burdened with debts that they had no hope of paying,” writes Hansen, insolvent debtors “had no incentive to be productive … Freed from these debts they could once again become productive members of society.”
This commitment to second chances has been a noble American ideal. It’s also, however, a part of what Martin Luther King Jr. would call an uncashed “promissory note” that the U.S. has brutally denied to African-Americans. Painfully, the re-emergence of the debt prison compounds these past wrongs. It disproportionately denies economic dignity to millions of Black Americans — many already unfairly entangled in the criminal justice system — and betrays the American ideal of second chances.
The Rise of Fines and User Fees:
How did these new debt prisons emerge gradually, in plain sight? Since the late 1980s, state and local governments have been increasing fines for minor infractions and what one could think of as ‘punitive user fees’ for court costs, incarceration, and probation as they faced the budgetary pressure of a growing criminal justice system. By 2012, these fees brought in over $15 billion a year. That year, revenue from fines and forfeitures combined were equivalent to 15 percent of law enforcement operating costs — and a third of expenses for one in 10 police departments, according to the Brookings Institution.
Since 2008, nearly every state has increased or added new criminal and civil court fees, as the Brennan Center reports. Additionally, the U.S. Commission on Civil Rights found a clear relationship between budgetary need and excessive fees: 92 of the 100 municipalities that collected the most in fees had local courts that partially or fully funded themselves.
In some places, fines and fees make up an even larger share of local government revenues. One percent of counties took in the equivalent of 90 percent of operating law enforcement budgets in fines and forfeitures in 2012. Georgetown, La., for example, collected 92 percent of its general revenues in fines in 2018.
Most people are probably unaware of the breadth of punitive user fees that Americans are saddled with when they go through our criminal justice system. In North Carolina, as of 2019, people were charged $10 per day in jail, and faced a $600 crime lab fee if their case had forensics, and an additional $600 fee if an expert witness testifies. That was on top of a $173 fee for appearing in criminal court. In 2014, NPR found that in over 40 states defendants can be billed for services that might include a public defender, room and board for time in jail and prison, their own probation and parole supervision, and even court-required electronic monitoring devices.
The fees do not stop even as people are trying to right their lives. Every probation system in the country has underlying costs that add to the financial strain on the 3.5 million Americans in the system. This makes it harder to stay out of jail or prison. For example, courts often require that probationers and parolees pay for frequent drug tests, costly electric monitoring, and expensive classes.
Cindy Rodriguez, for example, is a disabled, middle-aged woman in Tennessee who was arrested on a charge of shoplifting in 2014. She followed her public defender’s advice, pleaded guilty, and accepted probation. Her probation lasted nearly a year under the supervision of a private probation contractor. The company charged her $35-45 a month and $20 for each randomly administered drug test, on top of the $578 she owed the court. She had to sell her van to keep up with these payments and lost her apartment. Still, she was booked into jail for owing money.
Deepening Racial Bias in the Criminal Justice System:
This method of funding law enforcement only magnifies the systemic racial discrimination in our criminal justice system. This was seen starkly in Ferguson, Mo. The Department of Justice found that the city’s predatory practices against its Black residents were driven by a toxic combination of explicit racial prejudice and callous fiscal manipulation. In 2013, city officials expanded the use of fines to the equivalent of half of its police budget. Ninety-two percent of Ferguson’s court warrants, almost exclusively used to compel fee payments, were against Black residents.
Study after study confirms that Ferguson is far from the exception. The U.S. Commission on Civil Rights found in 2017 that “municipal fee targeting tends to aggregate in communities of color,” whose governments use “law enforcement as ticketing and collections agencies to increase municipal revenues as distinct from focusing on public safety and civil compliance.” A nationwide study of over 9,000 cities found that cities with the largest share of Black residents collect over five times as much in fines and fees per capita as the cities with the smallest share of Black residents. In places where police can keep seized property, the negative racial impact is even worse. A nationwide study revealed that where police departments are allowed to permanently seize property, budget shortfalls lead to major increases in Blacks and Latinos experiencing arrests and property seizures for D.U.I.’s and drugs offenses, while the treatment of whites remains largely unchanged.
Credit...The Heads of StateOpinion
By Gene B. Sperling
Mr. Sperling was the director of the National Economic Council under Presidents Barack Obama and Bill Clinton, and is the author of “Economic Dignity.”
Feb. 16, 2021
While controversial calls to “defund the police” have grabbed headlines, we urgently need to examine how we fund the police today. The increasing use of excessive fees, fines, and surcharges to fund parts of our criminal justice system is creating punitive debt traps for millions of low-income Americans leaving prison. Many find themselves in an economic prison: prevented from paying down their debts by the debts themselves. Others are so entrapped that they are actually reincarcerated for unpaid debt. Either way, they are denied the dignity of a real second chance — and a fresh start to pursue one’s purpose and to contribute to family, community and country.
Criminal justice debt has garnered growing attention — including today in Florida, where unpaid fees and fines are being used to deny those with a past felony the ability to vote. But what has gotten inadequate attention is the increasing role these fees play in funding our courts and police departments, and how they crush the chances of millions of Black and brown Americans to make a better life for themselves and their families, through what can be seen, figuratively and literally, as new debt prisons.
The fact that 21st-century America is recreating any form of debt prison is painfully ironic from a historical perspective. The United States was, after all, the first major nation to get rid of debt prisons in the 1820s and 1830s and embrace “fresh starts” for bankrupts at a time when “debtors were imprisoned in every country in Europe except Portugal,” according to historian Jill Lepore. Alexis de Tocqueville was to later note that this willingness to not see bankrupts as forever “disgrace[d] made Americans differ, not only from the nations of Europe, but from all the commercial nations of our time.”
This movement reflected a powerful American ideal: It was wrong to permanently shackle a person’s productive potential. As the economic historian Bradley Hansen writes, many came to believe “a fresh start was not only fair but in the best interest of society,” as it promoted both individual dignity and economic growth. “Burdened with debts that they had no hope of paying,” writes Hansen, insolvent debtors “had no incentive to be productive … Freed from these debts they could once again become productive members of society.”
This commitment to second chances has been a noble American ideal. It’s also, however, a part of what Martin Luther King Jr. would call an uncashed “promissory note” that the U.S. has brutally denied to African-Americans. Painfully, the re-emergence of the debt prison compounds these past wrongs. It disproportionately denies economic dignity to millions of Black Americans — many already unfairly entangled in the criminal justice system — and betrays the American ideal of second chances.
The Rise of Fines and User Fees:
How did these new debt prisons emerge gradually, in plain sight? Since the late 1980s, state and local governments have been increasing fines for minor infractions and what one could think of as ‘punitive user fees’ for court costs, incarceration, and probation as they faced the budgetary pressure of a growing criminal justice system. By 2012, these fees brought in over $15 billion a year. That year, revenue from fines and forfeitures combined were equivalent to 15 percent of law enforcement operating costs — and a third of expenses for one in 10 police departments, according to the Brookings Institution.
Since 2008, nearly every state has increased or added new criminal and civil court fees, as the Brennan Center reports. Additionally, the U.S. Commission on Civil Rights found a clear relationship between budgetary need and excessive fees: 92 of the 100 municipalities that collected the most in fees had local courts that partially or fully funded themselves.
In some places, fines and fees make up an even larger share of local government revenues. One percent of counties took in the equivalent of 90 percent of operating law enforcement budgets in fines and forfeitures in 2012. Georgetown, La., for example, collected 92 percent of its general revenues in fines in 2018.
Most people are probably unaware of the breadth of punitive user fees that Americans are saddled with when they go through our criminal justice system. In North Carolina, as of 2019, people were charged $10 per day in jail, and faced a $600 crime lab fee if their case had forensics, and an additional $600 fee if an expert witness testifies. That was on top of a $173 fee for appearing in criminal court. In 2014, NPR found that in over 40 states defendants can be billed for services that might include a public defender, room and board for time in jail and prison, their own probation and parole supervision, and even court-required electronic monitoring devices.
The fees do not stop even as people are trying to right their lives. Every probation system in the country has underlying costs that add to the financial strain on the 3.5 million Americans in the system. This makes it harder to stay out of jail or prison. For example, courts often require that probationers and parolees pay for frequent drug tests, costly electric monitoring, and expensive classes.
Cindy Rodriguez, for example, is a disabled, middle-aged woman in Tennessee who was arrested on a charge of shoplifting in 2014. She followed her public defender’s advice, pleaded guilty, and accepted probation. Her probation lasted nearly a year under the supervision of a private probation contractor. The company charged her $35-45 a month and $20 for each randomly administered drug test, on top of the $578 she owed the court. She had to sell her van to keep up with these payments and lost her apartment. Still, she was booked into jail for owing money.
Deepening Racial Bias in the Criminal Justice System:
This method of funding law enforcement only magnifies the systemic racial discrimination in our criminal justice system. This was seen starkly in Ferguson, Mo. The Department of Justice found that the city’s predatory practices against its Black residents were driven by a toxic combination of explicit racial prejudice and callous fiscal manipulation. In 2013, city officials expanded the use of fines to the equivalent of half of its police budget. Ninety-two percent of Ferguson’s court warrants, almost exclusively used to compel fee payments, were against Black residents.
Study after study confirms that Ferguson is far from the exception. The U.S. Commission on Civil Rights found in 2017 that “municipal fee targeting tends to aggregate in communities of color,” whose governments use “law enforcement as ticketing and collections agencies to increase municipal revenues as distinct from focusing on public safety and civil compliance.” A nationwide study of over 9,000 cities found that cities with the largest share of Black residents collect over five times as much in fines and fees per capita as the cities with the smallest share of Black residents. In places where police can keep seized property, the negative racial impact is even worse. A nationwide study revealed that where police departments are allowed to permanently seize property, budget shortfalls lead to major increases in Blacks and Latinos experiencing arrests and property seizures for D.U.I.’s and drugs offenses, while the treatment of whites remains largely unchanged.
Credit...The Heads of State
Economically Imprisoning People in Debt:
This increasing use of punitive user fees now traps millions in debt. Millions of Americans collectively owe tens of billions in unpaid court debt; Sociologist Alexes Harris found in 2014 that about 80 to 85 percent of inmates were leaving prison owing money, often a significant amount.
And like payday lending, this debt is designed to accumulate. States often impose “poverty penalties,” including late fees, interest charges as high as 12 percent, and collection fees. Florida and Tennessee assign unpaid criminal justice debt to private collection firms, and allow them to add a 40 percent collection fee. Most people getting out of prison cannot afford these costs. Nearly half of ex-prisoners have zero reported earnings in the year after their release. Those that do find a job take home a median of about $10,000, thousands less than the typical cost of a conviction.
All these steep costs compound and pile up, creating multiple barriers to a fresh start and a second chance.
First, when private debt collectors get criminal debts converted into civil judgments it can lead to lower credit scores. This makes it harder to find housing, buy a car, and get a job. Second, the vast majority of states suspend licenses for failure to pay court debt — even though being able to drive is often essential for getting a job, getting to work on time — and yes, paying back criminal justice debt. Forty-one states suspend or keep people from renewing their driver’s license for owing court debt, according to Free to Drive. There are from seven million to 11 million Americans with suspended licenses as a result of traffic and court debt. A Rutgers University study found that 42 percent of New Jersey residents who had their licenses suspended lost their job. Forty-five percent of those who became unemployed couldn’t find another job, and 88 percent of those who found another job reported earning less than in their previous job.
Third, criminal justice debt can deny those leaving prison from attaining the occupational licenses that one in four jobs require for a new occupation and career. Take Jackie, a mother of three, and a trained nursing assistant. Her $800 in debt stood in the way of clearing her criminal history and being able to get the certified nursing assistant license she needed to do the job that she trained for. But she had neither the income nor the savings to pay what she owed and struggled to make $5 monthly payments. Some states go even further, charging exorbitant rates for expungements. Louisiana charges $550. It’s a cruel Catch 22: where criminal justice debt prevents people from finding jobs, it both denies those Americans a second chance and a fresh start and blocks their capacity to pay back such debts.
Actual Prison for Debt:
The new debt prisons are not just metaphorical. Criminal justice debt also lands many in actual jail or prison. In 1983, the Supreme Court ruled that jailing indigent debtors violated the 14th Amendment. Yet judges rarely consider defendants’ ability to pay before imposing fines and fees, and studies across different regions found that one in five people in jail were there for unpaid court debt. Across the country, from Missouri to New York to Texas, people are serving jail time for missing fines and fees payments. Texas jailed over half a million people in 2017 for failing to pay fines and fees and over 450,000 in 2018. As of 2016, 44 states allowed courts to send people back to jail or prison for failing to pay court debt.
In a stark example that seems drawn from a century ago, in Mississippi, judges can give indefinite sentences for people to work off their restitution and court debt at one of the state’s four “restitution centers.” Debtors work for private employers with sentences that can last as long as it takes to pay off their debt. Three quarters of the money people “earn” in these centers goes to the courts and corrections department, and half of the people in the centers were working off less than $3,515 in debt.
This has to stop.
The evidence is now overwhelming that the explosion of criminal justice debt deepens the system’s racial inequities and blocks millions of Americans from the capacity to earn a living and care for their families. We need to call for state and local governments to fund the police and criminal justice system through general revenues or widespread forms of financing instead of such fines and fees. This would both increase second chances and administrative efficiency. The Brennan Center reports that it costs states and local government a whopping 121 times more to collect funds through fines and fees than it costs the IRS to collect the same amount of revenue. And while we undergo a national re-examination of cash bail and other forms of criminalization of poverty, we should make a flat determination to stop jailing anyone for failure to pay criminal justice fines and fees due to poverty or lack of income or savings.
We also must expand legislative efforts to curtail the suspension of driver’s licenses due to unpaid fines and fees as we’ve seen recently in states and cities, including New York, West Virginia, California Washington, D.C., and Chicago. The bipartisan Driving for Opportunity Act, co-sponsored by Senators Chris Coons, Democrat of Delaware, and Roger Wicker, Republican of Mississippi, and supported by Patrick Yoes, the national president of the Fraternal Order of Police, would incentivize more states to stop suspending licenses for unpaid debt. The recent legislation to repeal the ban on Pell grants for those in prison seeking a higher education is welcome news but only a first step. To increase job opportunities and economic independence for those leaving incarceration, far more funding is needed to expand innovative pre-apprenticeship programs for those incarcerated, to support “clean slate” efforts to expunge records for those with arrests or convictions and to provide comprehensive transitional housing and employment help to those leaving prison.
A belief in the economic logic and economic dignity of giving all Americans second and third chances led our nation to end debt prisons once before. It’s time to put an end to them one more time.
Gene Sperling was the director of the National Economic Council under President Barack Obama and President Bill Clinton, and is the author of “Economic Dignity.”
Follow The New York Times Opinion section on Facebook, Twitter (@NYTopinion) and Instagram.
Economically Imprisoning People in Debt:
This increasing use of punitive user fees now traps millions in debt. Millions of Americans collectively owe tens of billions in unpaid court debt; Sociologist Alexes Harris found in 2014 that about 80 to 85 percent of inmates were leaving prison owing money, often a significant amount.
And like payday lending, this debt is designed to accumulate. States often impose “poverty penalties,” including late fees, interest charges as high as 12 percent, and collection fees. Florida and Tennessee assign unpaid criminal justice debt to private collection firms, and allow them to add a 40 percent collection fee. Most people getting out of prison cannot afford these costs. Nearly half of ex-prisoners have zero reported earnings in the year after their release. Those that do find a job take home a median of about $10,000, thousands less than the typical cost of a conviction.
All these steep costs compound and pile up, creating multiple barriers to a fresh start and a second chance.
First, when private debt collectors get criminal debts converted into civil judgments it can lead to lower credit scores. This makes it harder to find housing, buy a car, and get a job. Second, the vast majority of states suspend licenses for failure to pay court debt — even though being able to drive is often essential for getting a job, getting to work on time — and yes, paying back criminal justice debt. Forty-one states suspend or keep people from renewing their driver’s license for owing court debt, according to Free to Drive. There are from seven million to 11 million Americans with suspended licenses as a result of traffic and court debt. A Rutgers University study found that 42 percent of New Jersey residents who had their licenses suspended lost their job. Forty-five percent of those who became unemployed couldn’t find another job, and 88 percent of those who found another job reported earning less than in their previous job.
Third, criminal justice debt can deny those leaving prison from attaining the occupational licenses that one in four jobs require for a new occupation and career. Take Jackie, a mother of three, and a trained nursing assistant. Her $800 in debt stood in the way of clearing her criminal history and being able to get the certified nursing assistant license she needed to do the job that she trained for. But she had neither the income nor the savings to pay what she owed and struggled to make $5 monthly payments. Some states go even further, charging exorbitant rates for expungements. Louisiana charges $550. It’s a cruel Catch 22: where criminal justice debt prevents people from finding jobs, it both denies those Americans a second chance and a fresh start and blocks their capacity to pay back such debts.
Actual Prison for Debt:
The new debt prisons are not just metaphorical. Criminal justice debt also lands many in actual jail or prison. In 1983, the Supreme Court ruled that jailing indigent debtors violated the 14th Amendment. Yet judges rarely consider defendants’ ability to pay before imposing fines and fees, and studies across different regions found that one in five people in jail were there for unpaid court debt. Across the country, from Missouri to New York to Texas, people are serving jail time for missing fines and fees payments. Texas jailed over half a million people in 2017 for failing to pay fines and fees and over 450,000 in 2018. As of 2016, 44 states allowed courts to send people back to jail or prison for failing to pay court debt.
In a stark example that seems drawn from a century ago, in Mississippi, judges can give indefinite sentences for people to work off their restitution and court debt at one of the state’s four “restitution centers.” Debtors work for private employers with sentences that can last as long as it takes to pay off their debt. Three quarters of the money people “earn” in these centers goes to the courts and corrections department, and half of the people in the centers were working off less than $3,515 in debt.
This has to stop.
The evidence is now overwhelming that the explosion of criminal justice debt deepens the system’s racial inequities and blocks millions of Americans from the capacity to earn a living and care for their families. We need to call for state and local governments to fund the police and criminal justice system through general revenues or widespread forms of financing instead of such fines and fees. This would both increase second chances and administrative efficiency. The Brennan Center reports that it costs states and local government a whopping 121 times more to collect funds through fines and fees than it costs the IRS to collect the same amount of revenue. And while we undergo a national re-examination of cash bail and other forms of criminalization of poverty, we should make a flat determination to stop jailing anyone for failure to pay criminal justice fines and fees due to poverty or lack of income or savings.
We also must expand legislative efforts to curtail the suspension of driver’s licenses due to unpaid fines and fees as we’ve seen recently in states and cities, including New York, West Virginia, California Washington, D.C., and Chicago. The bipartisan Driving for Opportunity Act, co-sponsored by Senators Chris Coons, Democrat of Delaware, and Roger Wicker, Republican of Mississippi, and supported by Patrick Yoes, the national president of the Fraternal Order of Police, would incentivize more states to stop suspending licenses for unpaid debt. The recent legislation to repeal the ban on Pell grants for those in prison seeking a higher education is welcome news but only a first step. To increase job opportunities and economic independence for those leaving incarceration, far more funding is needed to expand innovative pre-apprenticeship programs for those incarcerated, to support “clean slate” efforts to expunge records for those with arrests or convictions and to provide comprehensive transitional housing and employment help to those leaving prison.
A belief in the economic logic and economic dignity of giving all Americans second and third chances led our nation to end debt prisons once before. It’s time to put an end to them one more time.
Gene Sperling was the director of the National Economic Council under President Barack Obama and President Bill Clinton, and is the author of “Economic Dignity.”
Follow The New York Times Opinion section on Facebook, Twitter (@NYTopinion) and Instagram.
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