The Juvenile Justice Policymaking - Essay Example

Cost Benefits Analysis and the Juvenile Justice Policymaking The stage where a decision, initiative or an aspect of policy is examined for its advantages and disadvantages is inherent in policymaking. This is particularly true when policymakers seek the best decisions and policies. In some cases there are policies that are simple and do not require complicated methods of evaluation. There are also those with outcomes and costs that are difficult to determine. In both of these instances, the cost benefit analysis (CBA) model becomes extremely helpful. The methodology informs policymakers such as legislators and executives of governmental agencies and based from the cases of CBA adoption in any countries, the outcome is effective and successful. In the case of the United States, CBA is considered as one of the standards in some aspects of policymaking. For example, the agency mandated with regulatory oversight use cost benefit analysis to improve regulatory proposals and stimulate new measures where the benefits exceed the costs (Hahn, & Dudley 2006 p.1). The Cost Benefit Analysis Model The guideline provided by the National Conference of State Legislatures (NCSL) defines the cost benefit analysis as "systemic tool for evaluating public policy,” and that “it allows lawmakers to weigh multiple options and determine which will achieve the greatest results for the lowest cost" (p.3). The identified process in the same guide cites five fundamental stages of CBA. These are: 1. the determination of effects of the initiative; 2. the determination whose perspective matter; the measurement of costs in dollars and cents; 3. the measurement of benefits in dollars and cents; and, 4. the comparison of the costs and benefits (NCSL, p.2). The above stages show how CBA is, essentially, an economic analysis or a method that applies economic approaches to public policymaking. Many economists encourage this because the model can supposedly assess policy better than any other analytical tool (Lave 1982; and, Arrow et al., 1996). According to Pearce, "CBA is rooted in the concept of economic efficiency in the respects of requiring that any goal be met at least overall cost, that benefits must exceed costs for any course of action, and that, where possible, goals should themselves be determined by reference to a maximum excess of benefits over costs" (p.87). Based from the insights provided by the CBA conceptual framework, three core competencies that underpin the assessment models importance are highlighted. First is that it is comprehensive. It does not only measure the costs and benefits but it also establishes the stakeholders in the initiative and contextualizes the assessment according to whom the initiative matters. Furthermore, the model can also determine which of the stakeholders will emerge as losers and winners from the initiative. Secondly, it quantifies costs and benefits. By translating intangible variables into monetary values, the measurement, analysis and projection become easier and effective. Finally, by turning all variables into monetary value, it allows for easier comparison, not just between cost and benefits variables but also between policies. This is even true for policies that have different objectives. For example, if a city has to choose only one policy from two options: a program that protects public health and a program that seeks to improve security, it can use the cost benefits analysis. The city – through this model - can determine which of the two initiatives will produce the more social benefit. This area also highlights the manner by which CBA can identify key deficiencies in peoples and organizations understanding of a policy and highlight the differences in the results especially when the initiative or an aspect of it is modified (Viscusi and Hamilton 1999). The available literature on CBA, particularly in the area of empirical research, demonstrates a consistent and almost standardized usage of CBA in policymaking (Viscusi 1996). This is the case in the US where studies done on the administrations of President Reagan, Bush and Clinton reveal mandatory directives to use CBA in reviewing major regulations as well as in enforcing accountability reforms (see President Reagans Executive Order 12291 and President Clintons Executive Order 12866). In the US, hence, CBA is used in most areas of public policy and one can expect a developed and sophisticated framework based from years of experience with the model in the context of governmental policymaking. The use of the model in regulatory policymaking is approaching its fourth decade. Shapiro (2010) observed that it is now firmly entrenched in the regulatory process and few predict that this will change in the decades ahead (p.2). Perhaps this is because it is validated by the Interest Group Theory, which explains the importance of cost and benefits model best in countries with representative governments and typified by interest group politics and entrepreneurial politics. The model appeals to the collective sensibilities, interactions, attitudes and objectives. Policy Case Study: Juvenile Justice Program Application The juvenile justice policymaking in the United States is an excellent example of the application of cost benefit analysis to policymaking. This was cited in detail in the National Council of State Legislatures Cost-Benefit Analysis of Juvenile Justice Programs. This paper will use this reference to explain the application of CBA in the juvenile justice programs initiatives of several states in the US. The link between CBA and juvenile justice or, rather, the current interest in CBA for juvenile justice programs can be traced to the recent developments news about cost-efficiencies in several states. The state of Washington, like many states in the US has to deal with the increase in prison population. The state, based from a study, is projected to need 3 new prison facilities by 2030. To address the prison requirements, the state commissioned a study in preparation for such new constructions. The study, which was conducted by the Washington State Institute for Public Policy (WSIPP), used cost-benefits analysis. It was found that the state could actually save up to $2 billion in the long-term and reduce crime by using evidence-based alternatives to incarceration (NCSL, p.4). Two of the cited alternatives to imprisonment, which could radically save the state money, were functional family therapy and aggression replacement training. The former seeks to address the problem by improving protective factors and reducing risk factors for juvenile delinquents, whereas the aggression replacement training supposedly saves $11.66 dollars for every $1 spent, with a projection of 24 percent drop in recidivism within 18 months (p.4). Similar or related initiatives were undertaken by several states. For instance, the state of Florida, through CBA-based studies was able to develop alternative programs that would keep them from spending millions in maintaining facilities, treatments and interventions for juvenile prisoners. For example, cost benefits analysis revealed that the requirement for psychiatric treatment of 76% of juveniles in state detention could actually be addressed by the introduction of diversion programs (p.5). Based from the cases cited in this section in addition to the conceptual definition cited earlier, one could obtain some insights with how CBA is applied in juvenile justice programs and how it deals with the tangible and intangible aspects in policymaking. First, the CBA-based interventions/initiatives were results of reports that extensively evaluated: opportunity costs both to the private and public stakeholders; and, the benefits of alternative/proposed programs and solutions. Next, the policymakers should have determined the applicability of existing governmental rules and regulations that govern the initiative such as Executive Order 12291 or the Clinton EO 12866. The method, then, monetized all variables such as costs, benefits, future costs and benefits, discounts for risks and uncertainty in the outcomes as well as detailed comparisons between the current initiative and past programs as well as with other programs. Limitations Certainly, the cost benefits analysis model is not without flaws. There are some limitations to the model, particularly when applied to public policymaking. The most important of these would have to be the difficulty in translating intangible area of policy into monetary value such as public good, public benefits and variables like knowledge capital, quality and risks, among others. These include the costs entailed in the bureaucracy and the manner by which programs are implemented in the government. For instance, in evaluating the benefits in a public health program, it is difficult to specify and measure the cost for quality of care. A study in the aerospace industry also demonstrated this when it revealed how variables such as “shocks” as well as the uncertainties and risks entailed in the arrangements, and contracts between public and private organizations are difficult to quantify and measure (Masten 1984). There is also the case of monetizing the cost of information. The work of Crawford and Krahn 1998) highlighted this when they found that information asymmetry contributes to the difficulty in determining opportunity costs, particularly because specialized knowledge and other related intangible assets such as skills are hard to monetize. When one examines the framework, one will also find an uncertainty in the way policymaking determines the beneficiary/beneficiaries of a CBA-based policy. It has been cited earlier that the CBA process leads to the identification of the stakeholder(s) that will benefit the policy. It can determine who wins and who loses because the process identifies the target of the initiative. For example, the CBA model developed by the WSIPP was designed for the state of Washington. The evaluation primarily contained costs and benefits to the state and not to the welfare of the juvenile delinquents, who are also important stakeholders in the policy. These two factors are just some of challenges inherent in the CBA model. The government and its agencies must find a way to address these variables as they encounter them in policymaking. Conclusion All in all, cost benefits analysis is an effective method in reaching the best decision, in choosing the best initiative and in determining the best possible benefits to the public in the policymaking process. As an economic approach, it is effective as it monetizes all computed variables so that the data are easier to evaluate. This also means that the analytical process is systematic. Again, as has been cited previously, there are three core competencies in the CBA model: it is comprehensive; it is simple but effective; and, it allows for effective comparisons, which could reveal several policy insights particularly on what works and what does not within specific program and between programs. These are demonstrated in the case of the CBA-based juvenile justice programs in several states in the US. The cases from the state of Washington and Florida provide the evidences for this argument. Ultimately, CBA allows the government to save money and determine the efficacy of its policies. References Arrow, K., Cropper, M., Eads, G., Hahn, R., Lave, L., Noll, R., Portney, P., Russell, M., Schmalensee, R., Smith, K., and Stavins, R. (1996). Is There a Role for Benefit-Cost Analysis in Environmental, Health, and Safety Regulation? Science, 272(April), 221-222. Clinton, W. (1993). Executive Order 12,866: Regulatory Planning and Review. Washington DC: General Printing Office. Crawford, J. and Krahn, S. (1998). The Demanding Customer and the Hollow Organization. Public Productivity and Management Review, 22(1), 107-118. Hahn, R. and Dudley, R. (2006). How Well Does the Government Do Cost-Benefit Analysis?. Working Paper 14-10. AEI-Brookings Joint Center for Regulatory Studies. Lave, L. (1982). The Strategy of Social Regulation: Decision Frameworks for Policy. Washington DC: Brookings Institution. Masten, S. (1984). The Organization of Production: Evidence from the Aerospace Industry. Journal of Law and Economics, 27(2), 402-417. National Conference of State Legislatures. (2008). Cost-Benefit Analysis of Juvenile Justice Programs. NCSL. Pearce, D. (1998). Cost-Benefit Analysis and Environmental Policy. Oxford Review of Economic Policy, 14(4), 84-100. Reagan, R. (1981). Executive Order 12291: Federal Regulation. Washington DC: General Printing Office. Shapiro, S. (2010). The Evolution of Cost-Benefit Analysis in U.S. Regulatory Decision-making. Working paper No. 5. Jerusalem Forum on Regulation and Governance. Viscusi, K. (1996). Economic Foundations of the Current Regulatory Reform Efforts. Journal of Economic Perspectives, 10(3), 119-134. Viscusi, K. and Hamilton, J. (1999). Are Risk Regulators Rational? The American Economic Review, 89, 1010-1027. Read More

This is even true for policies that have different objectives. For example, if a city has to choose only one policy from two options: a program that protects public health and a program that seeks to improve security, it can use the cost benefits analysis. The city – through this model - can determine which of the two initiatives will produce the more social benefit. This area also highlights the manner by which CBA can identify key deficiencies in peoples and organizations understanding of a policy and highlight the differences in the results especially when the initiative or an aspect of it is modified (Viscusi and Hamilton 1999).

The available literature on CBA, particularly in the area of empirical research, demonstrates a consistent and almost standardized usage of CBA in policymaking (Viscusi 1996). This is the case in the US where studies done on the administrations of President Reagan, Bush and Clinton reveal mandatory directives to use CBA in reviewing major regulations as well as in enforcing accountability reforms (see President Reagans Executive Order 12291 and President Clintons Executive Order 12866). In the US, hence, CBA is used in most areas of public policy and one can expect a developed and sophisticated framework based from years of experience with the model in the context of governmental policymaking.

The use of the model in regulatory policymaking is approaching its fourth decade. Shapiro (2010) observed that it is now firmly entrenched in the regulatory process and few predict that this will change in the decades ahead (p.2). Perhaps this is because it is validated by the Interest Group Theory, which explains the importance of cost and benefits model best in countries with representative governments and typified by interest group politics and entrepreneurial politics. The model appeals to the collective sensibilities, interactions, attitudes and objectives.

Policy Case Study: Juvenile Justice Program Application The juvenile justice policymaking in the United States is an excellent example of the application of cost benefit analysis to policymaking. This was cited in detail in the National Council of State Legislatures Cost-Benefit Analysis of Juvenile Justice Programs. This paper will use this reference to explain the application of CBA in the juvenile justice programs initiatives of several states in the US. The link between CBA and juvenile justice or, rather, the current interest in CBA for juvenile justice programs can be traced to the recent developments news about cost-efficiencies in several states.

The state of Washington, like many states in the US has to deal with the increase in prison population. The state, based from a study, is projected to need 3 new prison facilities by 2030. To address the prison requirements, the state commissioned a study in preparation for such new constructions. The study, which was conducted by the Washington State Institute for Public Policy (WSIPP), used cost-benefits analysis. It was found that the state could actually save up to $2 billion in the long-term and reduce crime by using evidence-based alternatives to incarceration (NCSL, p.4). Two of the cited alternatives to imprisonment, which could radically save the state money, were functional family therapy and aggression replacement training.

The former seeks to address the problem by improving protective factors and reducing risk factors for juvenile delinquents, whereas the aggression replacement training supposedly saves $11.66 dollars for every $1 spent, with a projection of 24 percent drop in recidivism within 18 months (p.4). Similar or related initiatives were undertaken by several states. For instance, the state of Florida, through CBA-based studies was able to develop alternative programs that would keep them from spending millions in maintaining facilities, treatments and interventions for juvenile prisoners.

For example, cost benefits analysis revealed that the requirement for psychiatric treatment of 76% of juveniles in state detention could actually be addressed by the introduction of diversion programs (p.5).

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