I’ve seen this idea crop up every now and again. And a lot of people are wanting this because 1. it sticks it to the rich and 2. it’s from Europe, so obviously it not only a. must be a good idea, but b. is going to be easy to implement in the 3rd largest country… Ugh. And there’s one thing in the US that makes this a no-go from the outset that I’ll get to at the end since… no on seems to bring it up.
So what’s the idea? Fines imposed by a Court should be based on your income:
fines (sic) should hurt people equally. $50 to a person living paycheck to paycheck is a huge setback; to someone earning six figures, it’s almost nothing. to people earning more than that, a drop in the ocean. a lot of rich people just park in disabled spots because the fine is nothing and it makes their life more convenient. Finland has done this with speeding tickets, and a Nokia executive paid around 100k for going 15 above the speed limit. i think this is the most fair and best way to enforce the law. if we decided fines on percentages, people would suffer proportionately equal to everyone else who broke said law. making fines dependent on income would make crime a financial risk for EVERYONE.
Now a lot of people brought up a lot of good points, so I’m only going to add a couple others to the discussion.
Income vs Cash Flow
Before getting into this, let’s address the idea that $50 “to someone making six figures, it’s almost nothing”. And I’ll use this specific point to clarify a couple terms many people either get confused in their mind, use interchangeably, or never knew were separate ideas to begin with.
And those terms are “income” and “cash flow”.
What’s the difference? As I’ve pointed out before: income doesn’t include only cash. That is what makes imposing fines based on income as opposed to cash flow extremely difficult.
Forgiven debts are income. Market value increases in a person’s retirement or investment accounts are, technically, income. (I have an account in my accounting system called “Change in Market Value” to account for this.) The same with the annual appraisals of my home’s value. Gifts, whether cash or otherwise, are income.
There is so much that is considered “income”, both in accounting and the tax code, that this idea becomes difficult from the outset. It’s one hell of a sliding scale. And if the person in question owns a small business, things become even more complicated. Since a lot of small business owners merely look rich on paper.
But again, there’s also the confusion between income and cash flow. A person’s income isn’t the whole story.
And if you impose fines based purely on income, you’ll essentially give a free pass to nearly half the country to just do what they want without any kind of penalty because they don’t have an income under IRS rules. Basing it on cash flow would, at least, capture those receiving government benefits such as welfare.
Policing for profit
One person in the Reddit thread I quoted above said this:
What stops high income people from being constantly pulled over and harassed by police to get the department gigantic paydays? I mean, I know people don’t exactly have a whole lot of pity for people who make a ton of money, but I don’t think it’s fair to let police go on fishing expeditions against them.
And it’s a valid point.
Now there are a lot of wealthy individuals who don’t drive fancy cars. They’ll drive a Toyota Corolla or another mid-range sedan or SUV – like my Honda CR-V – and hang onto it for years, getting as much utility out of it before getting something new.
A lot of people try to look wealthier than they actually are. Hands up if you know someone who is a middle-income earner (so NOT 6-figures) who drives a Camaro or other sports car.
And along with “policing for profit” comes civil asset forfeiture and the can of worms that creates that is only now starting to be rolled back by the Courts. Since fines are revenue to the government, and police do get rewarded based on tickets and arrests, this would end up shifting police attention away from the more serious crimes because they don’t pad the government’s bottom line and won’t be nearly as rewarding to the police departments.
One last point no one brings up in these discussions with regard to the United States: the Eighth Amendment’s protection against “excessive fines”.
Excessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted
And plenty of States have similar or the exact same language mirrored in their own constitutions. In the Kansas Constitution it is in our Bill of Rights at Section 9 (though it says “cruel and unusual punishment”, not the plural “punishments” in the Eighth Amendment.)
As much as you might like to see fines imposed based on income, wealth, cash flow, or what have you, the first attempt at such in the United States would be quashed as violating the Eighth Amendment or the State Constitution. Imposing a fine of tens of thousands of dollars for a speeding ticket would be excessive under most everyone’s definition – except perhaps the “stick it to the rich” types.
The rich may not only have the money to pay the fine, but they also have the money to fight it. And it wouldn’t take much to get not just the fine declared unconstitutional, but the law that imposed it.
And in my instance, if Kansas law declared that I should pay $1000 for going 10 over the limit merely because of my AGI last year, I’d plead not guilty on the ticket to file a motion to have the law quashed under the Kansas Bill of Rights.