If you can afford a ritzy car, should you pay more for breaking the law?
Earlier this year, a motorcyclist in Oregon made local headlines when the state slapped him with a $1,103 fine for his 130 mph joy ride. If Portland City Commissioner Steve Novick had his way, though, things could have been much worse for the Seattle-based Ducati owner.
Last month, in the middle of a city council work session on a proposed $35 tax to support the arts, Novick bemoaned the existence of flat-rate taxes and fees that disproportionately hurt the poor. His support for progressive taxation extended even to his work at the Portland Transportation Bureau. According to the The Oregonian's Erik Luken, Novick said:
I wish we had a system like Finland, where the Highway Patrol's computers are linked up to that of Finland's IRS, and if you're a chief executive at Nokia and you're caught speeding you pay over $100,000.
Naturally, even though Novick's statement came with plenty of caveats, his suggestions became the butt of jokes around town. The Oregon House Republicans posted the article on their Facebook page, drawing exactly the comments you'd expect ("Another stupid idiot in office" probably qualifies as one of the nicer responses).
But Finland's scheme isn't as far-fetched as it seems. Income-adjusted fines have been the norm for decades, and in recent years Switzerland, Germany, and a few other northern European countries have adopted similar policies. These "day fines" try to connect dollars and cents penalties to the way that incarceration would affect the person being punished. For example, if both a high-powered lawyer and a waiter spent the same day in jail, the first would lose significantly more in billable hours than the second would in tips and minimum wage. Conversely, a $300 fine could be a week's take-home pay for one speeder and no more than a slap on the wrist to another.
This probably still seems unpalatable to most Americans. Yet we already accept that those who buy expensive cars, from Audis and Bentleys to Mercedes, take a bigger hit on insurance premiums (fitting, it turns out, as they may also be worse drivers). And judges regularly consider income levels when setting bail levels. Still, Novick said this scheme probably wasn't as "administratively possible" as a progressive tax would be.
Politics aside, the biggest question about these proportional fines is whether they actually work. And the jury still seems to be out. In the 1980s, lower courts in Staten Island and Milwaukee experimented with the introduction of day-fines for low-level municipal offenses. Researchers from the National Institute of Justice found no significant difference in recidivism rates for those given these pay-as-you-can fines, compared to offenders sentenced using the standard punishment schemes.
And even in the most publicized cases, the system has some kinks. Anssi Vanjoki, that Nokia exec Portland commissioner Steve Novick alluded to, never paid all of his record-breaking, headline-making €116,000 fine for a 2002 incident. It turns out Vanjoki had cashed in a large number of Nokia stock options in 1999, artificially inflating his yearly income. The fine was readjusted for his 2000 income and dropped 95 percent.
Despite the hubbub surrounding these high profile cases, this system is accepted in a growing number of countries in Scandinavia and beyond. In 2007, University of Helsinki psychology professor Heikki Summala, who works in the traffic research unit, told U.S. News & World Report, "The system is very democratic ... Huge fines are not common, and the people who get them generally accept it, because they have the money to pay for it."