Money sanctions
Chapter 1
Money sanctions
Money is probably the most frequently used means of punishing, deterring, compensating and regulating throughout the legal system. This should come as no surprise. Most of us pay fines several times a year, perhaps for a parking infraction or speeding on the highway, some of us for being drunk in public, others for running afoul of health and safety regulations, still others for assault and more serious offences. If corporations cannot be imprisoned, at least like the rest of us they can be fined and made to pay monetary damages to those they have harmed, even inadvertently. If we are defamed, the law may compensate us in money, even if we may have lost nothing but our pride. If we are maimed, hurt or even just traumatized, this may be made up to us in the form of money damages. With respect to automobile accidents, monetary compensation is paid by insurance companies on our behalf often in lieu of court awarded damages. With the purchase of very many commodities we contribute to the cost of damages paid to those who fall victim to exploding soft drink bottles, industrial accidents or drugs that have unexpected side effects. The cost of liability insurance against such losses to the manufacturers is built into the purchase price. Not only that, but of course these monies often include not only damages but also the associated legal costs. Restorative justice issues, small claims courts and neighbourhood justice disputes are often settled by relatively small payments in restitution. Restitution orders are also adjuncts or alternatives to fines in many jurisdictions, as are punitive damages, especially with respect to corporations and government offices. Monetary penalties and compensations are ubiquitous. They outnumber other sanctions delivered by criminal justice in many jurisdictions. Monetary damages long ago became the default remedy in civil law. Therefore, it is a surprise how little criminologists and sociolegal scholars talk about the nature of money and of its specific characteristics as a legal sanction. Indeed, with respect to criminology and criminal justice policy, it is amazing how little theoretically guided work has been devoted to monetary penalties at all.
At first, things do not look this way, for there is a vast literature on monetized sanctions. On the fine, for example, there has been endless research and discussion on such matters as: how best to enable or to make people pay their fines; what constitutes an appropriate level of fine for certain offences; whether the same level of fine should be levied against the rich as against the poor; whether it is fair to imprison the poor for nonpayment of fines – and if so, then what term of imprisonment equates with what amount of money fined. Numerous experiments have been tried in relation to these problems and numerous evaluations carried out, all in the name of making fines more ‘just’, more ‘affordable’ or more ‘effective’. These are important issues we will revisit, for they tell us much about what money can mean to those determining its role in justice. But theoretical and critical criminologists rarely talk about fines in terms of social theory – even though Georg Simmel, for example, provides a prominent and firm base from which they could have started. Overwhelmingly, criminologists much prefer to talk about prisons as if fines did not exist. For example, in the 1970s, a huge literature theorized about ‘decarceration’. Depending on your theory, this alleged emptying of incarcerating institutions occurred as a cost-cutting response to a fiscal crisis of the state, or as part of a strategy to widen the scope of discipline through much cheaper and less visible community based sanctions. For some analysts, it was both. Others took decarceration at face value as a sign that we were becoming more humane, and still others thought that it was simply more effective to treat offenders in the community than in carceral institutions. While you could take your pick of these theorizations, you would be lucky to find the fine even being mentioned in the analytical discussions. This is despite the fact that in official discourse throughout much of the twentieth century the fine is prominent as an alternative to imprisonment, and especially is viewed as a way of relieving pressure on institutions and reducing the costs of justice. Perhaps this peculiar criminological oversight tells us something important about monetized justice.
Ironically, the ‘decarceration’ literature was published just before almost unprecedented increases appeared in rates and volumes of imprisonment. This ‘punitive turn’ in penality has become the subject of endless theorizations in terms of ‘de-civilizing’ processes, a ‘culture of control’ and neoliberal politics. Yet, since the early 1980s, virtually nothing theoretically new has been written about the fine, and nothing at all written about how it relates to the processes of the so-called ‘punitive turn’. David Garland’s (2001) magisterial review of the emerging ‘culture of control’ associated with this question mentions the fine just once, and then only in passing. Indeed, we find only two generally recognized criminological attempts to think about fines in terms of social theory – that is if we discount the work of Jeremy Bentham and the specifically economic theorizations of the Chicago School spearheaded by Gary Becker. One of these theorizations, from the 1930s, was Rusche and Kirchheimer’s (1939) brief attempt to analyse the fine in terms of Marxist theory. They concluded that the fine’s form and function was an effect of relations of production. However, a harsh judge would say that they achieved little more than to say that fines would only develop into a major sanction when poor people could afford to pay them. Even this observation is dubious at best. Rusche and Kirchheimer paid no attention to the widespread use of fines in the seventeenth and eighteenth centuries. Moreover, they paid little attention to the reasons given in official discourse for preferring the fine to other sanctions, especially in preference to short periods of imprisonment. Perhaps this was because, in their view, these official discourses were to be regarded merely as an ideological window dressing to changes that had their true origins in the productive order. However, I will suggest that official discourse is rather revealing about the development of fines and about their place in a penal system that simultaneously decried them as nonreformative yet promoted them to a principal role.
Half a century after Rusche and Kirchheimer wrote their chapter in the 1930s, Anthony Bottoms (1983) wrote a brilliant but equally brief essay theorizing fines. He linked the growth of the fine to changes in forms of discipline in the factory, to the rise of automobiles, to electronic surveillance technologies and to the distinction between disciplinary and regulatory techniques for governing problems. He also suggested that the fine was linked to increasingly bureaucratic and administrative changes in the form of justice. We will visit these theorizations in depth in the next chapters, together with Richard Fox’s (1995, 1996) rich and sustained – but almost totally ignored – application of Bottoms’ insights in the Australian context.
This is a stunningly sparse theoretical literature for such an important sanction in criminal justice. Is there something about fines that makes them so obvious or uninteresting that people can’t even see the point of analysing the topic theoretically? Why is this the case even though most of us recognize that money means very different things in different places and times? We distinguish between ‘clean’ and ‘dirty’ money, between money for buying ‘necessities’ and money that we spend on ‘treats’. We give special meaning to people’s ‘lifetime savings’, to ‘hard earned’ and ‘easy’ money. We may get outraged if a corporation is fined only a small amount for causing the death of a child, even though at the same time we might cheerfully suggest that money has no meaning. In this light, money paid in fines seems to have a magical property of meaning nothing but at the same time being a measure of pain, cruelty, death, shame, nuisance, outrage, wrongfulness and so on. Yet we virtually ignore fines in criminology, even though far more people pay fines than go to prison and many of those in prison are there because they did not pay fines! And we ignore fines even though, for the most part, they have the amazing characteristic of being virtually the only criminal penalty that legally can be borne by someone other than the offender. Is not this a striking peculiarity that is worthy of attention?
If we turn to the other great modern legal sanction, monetary damages, the story appears to be different. There is a considerable literature analysing fields such as tort law and contract law in terms of various social theories. For example, the rise of contract law is frequently linked to the rise of entrepreneurial ideologies and class interests (Atiyah 1979; Horwitz 1977). However, for the most part this takes for granted the specificity of the money form that is its principal sanction, even though money was not always the principal civil law remedy. Before the modern era, this honour more often went to ‘specific performance’, which required that a broken contract should be carried out as originally agreed, not ‘compensated’ for in dollars and cents. Why did money become the default remedy in civil law in the nineteenth century, and why did ‘compensation’ nearly always come to be defined as an amount of money? Or again, if I publicly ridiculed my neighbour I may have been required to pay money, but I may alternatively have been required to deny the insult in public, or to repeat defamatory words under humiliating circumstances. At some point in time, money began to appear as a better sanction. But how did jurists and legislators come to the conclusion that money ‘compensates’ better for a ridicule, injury or a trauma that has done me no economic harm?
Again, as with the fine, we find a vast jurisprudential and administrative literature examining questions of how damages should be calculated; about the conditions under which money should be justly awarded rather than some form of specific remedy such as delivery of goods; about the justice and efficiency of compensatory payments in tort law as opposed to insurance schemes; about the strange and wonderful innovative practices that emerge whereby judges allocate damages in the name of ‘the most efficient tortfeasor’ or ‘deep pockets’. However, little of this refers to social theory. Again, there are a few exceptions, notably in Marxist or Marxian theory. Richard Abel (1982), for example, has briefly analysed money damages as commodifying worker injury, putting a price on harm in a way consistent with capitalism’s commodification of labour power. More centrally, there was a considerably flurry of interest about the same time – the late 1970s and early 1980s – over Horwitz’s (1977) pungent thesis that the rise of negligence, privity of contract and related doctrines at the time of industrialization reduced workers’ access to compensation and thereby reflected naked capitalist class interests. But, even in such work, where changes in access to remedies are at least subject to theoretical interpretation, there has been comparatively little interest with respect to the monetary form taken by compensation. If the fine seems to have been ignored, the monetary form of the major civil remedies has been taken for granted.
Nor is this a characteristic only of recent work. Consider Emile Durkheim, who raised the place of compensation in his evolutionary theory of legal sanctions. In his analysis, the increasing complexity of the division of labour was linked to changes in the forms of social cohesion. As the division of labour becomes more complex and diverse, shared experience of life diminishes. Correspondingly, fewer actions appear to be outrageous transgressions, simply because societies have become more diverse. Also, the violence of reactions to deviance dissipates for the same reason. While criminal law continues to be a domain that express moral condemnation, the social reactions and punishments become milder overall. More significantly, contract and restitutive sanctioning become the critical legal means that expresses the diverse yet interdependent nature of social relations. In place of outrage, individuals are seen to be unified into society through self-interest. Society, through the civil law (contract, tort, nuisance, etc.), will compensate any person harmed by another.
Of course, this theory has been extensively, if often mistakenly, criticized, significantly for its supposedly erroneous predictions of the course of criminal law.1 My point is not whether this thesis is defensible, but rather that the rise of specifically compensatory law occupied a prominent place in fin de siecle social theory. It could have been expected that theoretical analysis of compensation would become a major issue in the sociology of law. Instead, Durkheim’s work on physical and ‘repressive’ sanctions has been by far the main focus. Even so, it has to be recognized that Durkheim scarcely mentioned the money form of compensation as such, despite the fact that by the time he wrote, money damages had long become the default remedy in contract and tort law. Once again, money fell below the threshold of theoretical visibility, even though this form of sanction could be seen as best fitting a nonrepressive, complex and compensatory legal order. Indeed, as with the fine, and with almost as few exceptions, the invisibility of money itself to sociolegal theory’s analysis of civil law is remarkable.
Perhaps again, this is because money is obvious: it buys things and we use it all the time. However, if money is so obvious how could Georg Simmel (1990), for example, make us struggle through nearly five hundred pages of dense reasoning on its nature? And, why is it that the law itself gets in such a knot over money as a sanction and what it means? One of the standard texts, MacGregor on Damages, poses the rhetorical question of why money is provided for nonpecuniary harms. It answers rather lamely that ‘money is not awarded as a replacement for other money, but as a substitute for that which is generally more important than money: it is the best that the court can do’. (McGregor 1997:9). Just why this is ‘the best the court can do’ and why money is used even when clearly regarded as inadequate, are questions explored when we turn to money damages in Chapter Four. But, what are the ramifications of this for justice and social order? In some cases, the answer seems obvious, where money makes up for lost wages, profits or other lost opportunities for financial gain. However, we will see that even this is less obvious than we suppose. For example, how on earth could we work out the money value of a lost chance to race a horse, when we do not know if it would have won races it never ran, for bets of unknown value at odds never offered? Courts have decided that this can be resolved in terms of the value of the opportunity to win. But, what is this ‘value’ of money if it includes the intangible pleasure of winning? Moreover, what about situations where damages are awarded for pain and suffering, mental anguish, ridicule and contempt?
The answer that will emerge is that money is meant to buy pleasure that offsets pain and trauma. It is a source of solace. But how is this calculated? If this seems plausible in a consumer society, can we really imagine the court calculating how many BMWs buy off the trauma of seeing your child die? Indeed, one insight into the importance of the money form of sanction can be gained here. Imagine if, instead of awarding so many millions of dollars, the court awarded the successful plaintiff in an action for wrongful death a Florida mansion, two Jaguars, a luxury cruise and free first-class air travel. Probably the reaction would be outrage, but an award of money sufficient to buy these things passes without comment. Money appears to work its own meaningful effects, perhaps by distancing and abstracting sanctions from the grubby world of commodities – for the courts will not tell successful plaintiffs how to spend their damages. Alternatively, is the money meant to signify something else? Under some conditions, money expresses the amount of outrage, sympathy or even contempt felt by the court, so that arguably money means the whole gamut of emotional states as well as pleasure. So, after all, perhaps it is not that money means nothing, but that money may mean almost anything, especially in a commodity-focused society such as ours. And if money can mean something other than – or as well as – the power to purchase, what might this tell us about damages and fines? As a way of thinking through this, we can do worse than start with a social theorist who did spend a lot of time thinking about the meaning of money: Georg Simmel.
Simmel: money, meaning and freedom
For Simmel, money and money alone ‘is free from any quality and is exclusively determined by quantity’. It is characterized by ‘unconditional interchangeability’: money is ‘infinitely divisible and infinitely convertible’ (1990:292). It is thus abstract and expresses no value of its own, it is ‘nothing but the representation of other objects’, that is, the objects that it connects in a relationship. Probably the most familiar reading of this view is profoundly negative, for money depersonalizes, equates any person with any thing. Money makes us thing-like, turns the most precious things into commodities to be bought and sold and thus debases us. In this view, it is a vehicle for alienation. This certainly is one theoretical and political reading of money and, for Simmel, money can be seen this way, because it erodes the ‘unique personality’ that is so central at least to modern liberal visions of the self. For example,
Such a personality is almost completely destroyed under the conditions of a money economy. The delivery-man, the money-lender, the worker, upon whom we are dependent, do not operate as personalities because they enter into a relationship only by virtue of a single activity such as the delivery of goods, the lending of money, and because their other qualities, which alone would give them a personality, are missing.
(1990:292)
In this way, money can be seen as consistent with legal penalties that are levied anonymously, not necessarily against specific individuals per se so much as against them in their roles, positions of ownership or employment, such as ‘the licensee’, ‘the driver’ or ‘the proprietor’. Such ‘modern regulatory fines’ will be the subject of Chapter Three. However, note that Simmel is not suggesting that this transformation in relationships occurs just because money makes it happen. Rather, money makes it possible. Money is a condition of existence of a certain kind of anonymous or secondary sociality that may arise for other reasons. In this way, money, or more precisely the monetization of sanctions, is the foundation of a certain kind of governance or regulation. It is a form in which the target of governance may not be unique individuals at all but rather the distributions or collectivities, say drivers or owners, of which they are part. However, while this depersonalizing property of meaningless money may be alienating, Simmel was acutely aware of its other side. To the extent that money depersonalizes and facilitates anonymity, it also is a condition of existence of a certain kind of freedom. For Marx, the wage was a vehicle that disguises the extraction of surplus value – the workers cannot see that they are being paid less in value than the value they create. At the same time, because in this view money buys commodities, not the means to produce life’s necessities, the worker cannot achieve independence from wage slavery itself. For Marx the money economy is critical, because it is critical to the exploitation of workers. For Simmel, on the other hand, while it is true that the workers still remain tied to employers in general, they are no longer individually tied to a particular employer. The money wage makes possible exchangeability of employers as well as employees. In this way, regardless of changes in workers’ material conditions, which may or may not improve, they are ‘already on the way to personal freedom’. Independence from the will of a specific individual is a step toward the ‘independence from the will of others’ – something that Simmel regards as liberty. (1990:300–301).
Simmel then connects this specific point to his previous argument concerning the erosion of the unique personality. With monetization, the form of sociability changes. This is so particularly for the urban dweller who increasingly does not depend on other individuals qua individuals ‘but only upon their objective services which have a money value and therefore may be carried out by any interchangeable person’. In Simmel’s view, this does not simply liberate individuals through loosening personal dependencies, but creates a vision of mutual dependence at the level of the social that is quite redolent of Durkheim’s ‘organic solidarity’. However, unlike Durkheim, Simmel is centring the money form itself. For Simmel
Only through the growth of the (money) economy to its full capacity, complexity and internal interaction does the mutual dependence of people emerge The elimination of the personal element directs the individual toward his own resources and makes him more positively aware of his liberty than would be possible with the total lack of relationships. Money is the ideal representative of such a condition since it makes possible relationships between people but leaves them personally undisturbed; it is the exact measure of material achievements, but is very inadequate for the particular and the personal.
(1990:303)
Moving ahead of the argument in many ways, it could now be sensed that monetary sanctions may have a place as the form of sanction appropriate to a particular governmental vision of freedom. If the world is increasingly a society of strangers, then it is in that measure also a society in which relations of contract come to predominate. In such settings, the imagery of ‘normal’ relationships is of the ‘free and equal’ bargaining parties, and in contract law the default remedy for wrongs arising in the relationships between such parties comes to be that of money. We could say that money is the form of exchange befitting a society of abstract strangers, and the form of justice likewise reflects this imagery. This is deceptively simple. While we will examine the genealogy of contractual remedies in a later chapter, one of the characteristics of the rise of modern contract law is money’s displacement of specific remedies, remedies that required the specific performance of a bargain struck. If the original contract had called for the delivery of iron, and the price had been paid, then the legal remedy would be the delivery of the iron. By the nineteenth century, however, this had largely given way to remedy in an amount of money, one reason for which was precisely that to require specific performance was regarded as unduly coercive. It would compromise relationships between free people, because it would require the court to ‘stand over’ the defendant in order to ensure an action were properly performed, rather than simply requiring that compensation could be provided in the abstract and impersonal form of a money payment.