Managing the Costs of Corrections

• Published date: 01 April 1982
• Date: 01 April 1982
• DOI: http://doi.org/10.1177/003288558206200102
• Subject Matter: Articles

Managing the
Costs of Corrections
Todd R. Clear
Patricia M. Harris
Albert L. Record
Rutgers University
No single person or office is charged with the responsibility of
managing corrections costs. The chief executive of the corrections
agency administers its budget, but this is a very different function from
managing costs. In the case of corrections, as with many governmental
agencies, the itemized expenditure plan contained in the budget is
implemented by a responsible official, yet the source of the budget-
and the demands made upon it- fall within the authority of other
officials. That is to say, no single decision or easily identifiable set of
decisions determines the costs of corrections; instead these are the
result of a fragmented collection of unorganized, sometimes conflicting,
and certainly varied decisions of legislators, judges, probation officers,
jailers, parole officials, and media, among others.
This situation has two general consequences of interest. First,
because the fiscal status of corrections is a product of such complica-
tions, the &dquo;true&dquo; costs of incarceration are difficult to assess- the
precise number of dollars expended in correctional enterprise is ob-
scured by fragmentation. Second, and more important, it is extremely
difficult- if not virtually impossible under contemporary admini-
strative methods- to actually manage the costs of incarceration in a
proactive manner. The management of corrections’ costs would require
the centralized ability to manipulate both the demand for service and
the type of service provided so that there is a long-term and short-term
fit between resources available and policies for applying those re-
sources.
This paper is concerned with the costs of corrections, and it takes
a distinctly managerial view. We believe that it is not enough to simply
portray the costs of corrections in a descriptive fashion; but that these
costs can be understood only in the context of decisions made among
this paper is based on materials prepared for the Key Decision-Makers Seminars,
a project funded by the National Institute of Corrections and conducted by Rutgers
University and the National Council on Crime and Delinquency. The opinions expressed
here do not necessarily reflect the official positions of the National Institute of Correc-
tions. The authors would like to thank the following persons for their helpful suggestions
about various aspects of the positions expressed in thi, paper: James Austin, Stephanie
Barth, Alfred Blumncin, (;ail Fuiik(-, Dun V1. Gotlfred...on. Judith (;fn’I1(’,:B1. Kay Harris,
and Bradford Smith.
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competing priorities. Our point can be easily illustrated. In an era of
restricted government expenditures, the decision to renovate a facility,
increasing its capacity, can be made only in light of a competing need
for these funds to be applied, for instance, to public schools or public
transportation. Likewise, a decision to reduce costs by releasing pri-
soners to supervision must be weighed against the potential social costs
of their risk to the community and the true augmented costs of release
programs.
So far as we know, nowhere is this kind of reasoning being used
systematically to make overall fiscal decisions about corrections. Instead
of managing costs, programs are added or deleted in piecemeal fashion,
based largely on short-term political exigencies and questionable
assumptions. The disastrous results of this strategy are apparent:
demand for incarceration exceeds punishment capacity in most states;
I
facilities are below an acceptable level of quality in many states;2 and
the subject of incarceration has become a volatile political arena in
almost every region of the country.3 &dquo;Solutions&dquo; appear to be few and
far between, and so states turn to expensive programs of new construc-
tion,’ even though it remains doubtful whether this approach is truly
responsive to the problem at hand.5
Perhaps the dearth of solutions is in part due to the fact that we
continue to operate from the same fragmented mode: &dquo;emergency&dquo;
billS,6 temporary holding actions,’ and so forth abound, to the point
that the recent Attorney General’s report on violent crime8 based many
of its recommendations on precisely such immediate, crisis-oriented
steps as these.
L The Cost Management Perspective
We suggest that a new perspective is imperative, one which pre-
supposes the legitimacy of a need to take into account the variety of
long-term and short-term concerns that confront fiscal decision making
in corrections, and which is based on an accurate assessment of the full
costs and benefits of correctional practice. No readily available models
exist for constructing such a perspective on corrections. Instead, we
have developed our own perspective &dquo;from the ground up.&dquo; In doing so,
we have asked five general questions:
~
What factors seem to influence (cause changes in) the
demand for correctional services?
~
What is the real cost of providing those services?
~
How effective are those services at producing socially
valuable results?
~
What less expensive options exist for achieving similar
results?
~
How can the service demand-provision equation be man-
aged to exert long-term controls over costs, without increas-
ing short-term expenses beyond reasonable levels?
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Most readers will recognize that these questions are similar to the
kinds of issues that would be addressed in any planning effort regarding
a long-term decision to purchase a service. Indeed, this is a viewpoint
from which we assess fiscal problems in corrections: what are the costs
of buying certain services; what are the costs of not having them?
For the time being, let us argue that the general service provided by
corrections is the application of &dquo;punishment experiences&dquo; to offen-
ders. Prisons represent a subcategory of that service which might be
described as providing &dquo;incarcerative punishment experiences.&dquo; Of
course, some of the anticipated benefits (for general society) of pur-
chasing these experiences (for individual members of our society) might
be deterrence, rehabilitation, incapacitation -even what we might
wish to call &dquo;justice.&dquo; But we should not confuse the result desired (or
&dquo;benefit&dquo; of our fiscal expenditures) with the method chosen to achieve
the result, for we may find that no one-to-one correspondence neces-
sarily exists between purchasing an &dquo;experience&dquo; (service) for some
person and achieving the desired result of that experience.
From this perspective several implications arise for policy making.
For instance, &dquo;incarceration experiences&dquo; are a particularly expensive
version of available kinds of punishment. As we shall see, this is espe-
cially true when our demand for these experiences exceeds our capacity
to provide them without new capital expenditures. Likewise, it is also
true that we might wish to bear the expense of this type of experience
only if it provided benefits that are necessary to us and possible only
through this vehicle. Perhaps it is not too inappropriate to compare
this situation to one facing drug addicts and the seriously ill, for whom
&dquo;demand&dquo; is inelastic: for them, price of &dquo;services&dquo; is not an object,
in a sense, so long as it stays within certain bounds.
This is precisely the kind of reasoning we would refer to as cost-
management thinking. This kind of thinking treats as variables
&dquo;demand&dquo; for services, costs of services, &dquo;value&dquo; of services, alternative
sources for equivalent services, and projected patterns of service-
demand relationships. This is a long-term orientation toward correc-
tions management, and it is different from the kind of reasoning most
states pursue when allocating corrections resources. In contrast to a
cost-management approach, states have undertaken large-scale,
expensive construction policies as an almost knee-jerk response to the
fact that current demand for incarcerative punishment experiences
exceeds existing capacity. Too often, these policies have been promoted
without sufficiently critical analyses of the problem and absent consi-
deration of the range of less expensive policy options now available for
managing these problems. A cost-management approach involves a
more complex response to the current &dquo;crisis&dquo; in corrections.
An analogy drawn from another setting is helpful in illustrating
how the cost-management perspective might operate. Let us suppose
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that a large company owns an ocean liner which it uses only for the
purpose of providing &dquo;free&dquo; vacations to its employees (the vacations
are not &dquo;free&dquo; of course, since their cost comes out of the company’s
profits). Each employee has come to expect that- should he or she be
diligent and receive regular promotions- at predetermined points in
the career ladder, a &dquo;free&dquo; vacation will be provided to the employee
(executives receive first-class accommodations). Of course, the company
has researched the benefits of its use of the pleasure craft, and it has
found that the general morale of the company’s employees is improved
by this vacation plan as well as the job satisfaction of employees for a
period of time after they return from a cruise.
But now the company is faced with a problem. Recent company
growth has meant that for some time, the group of employees who
qualify for the vacation cruise substantially exceeds in size the availa-
bility of space on...