It’s Monday and although I haven’t been very productive this weekend I have managed to read through chapter 3 of Freakonomics. Entitled “Why Do Drug Dealers Still Live with Their Moms?” the chapter focuses heavily on conventional wisdom and the long-standing belief that drug dealers are big, fancy, rich guys driving beamers. In reality only a very small proportion of gang members live a wealthy life. Most are stuck in poverty, subject to all the woes of the drug trade without any real financial benefits.
Levitt and Dubner discuss how, once you look at the incentives, this begins to make a lot of sense. The rank and file members have an incentive to cause mayhem and pursue violence and fear to make a name for themselves, while the elite have an incentive to prevent this in order to keep business flowing. Gang leaders could divulge more cash, but this would only give the foot soldiers an incentive to gun for the top spot. While gangs might portray themselves as the alternative to corporate slavery, they in fact embrace much of the same rigid hierarchy and exploit frustrated workers in dead-end positions. Oh, and there are those small matters of possible arrest, abuse, addiction, death…I’ll get back to that.
So, this week my assignment is to identify a few key statistics are important in telling the chapter’s story. The first stats to intrigue me were the income numbers for gang members (pg 100). While J.T., the leader of the gang detailed in the chapter, averaged a monthly salary of $8,500, the rest of his gang was paid only a combined $9,500 (including 3 officers and 50 foot soldiers. That comes out to a measly $7/hr for officers $3.30/hr for foot soldiers.
After seeing these numbers I flipped back a pages97-98 to the stats on the companies revenues and costs. I skimmed over them the first time because I had no idea what a reasonable amount would be for a gang and the 2005-2006 dating of the book means a lot has probably changed, especially due to the recession. The monthly profit was only $18,000, inexplicably lower than I was expecting. Seriously, only as I write this do I realize that I was expecting AT LEAST a six-figure income, if not a six-figure profit. Hell, the way the movies portray it I was expecting seven or eight figures! So yeah, these profits and income stats really stress the story of the chapter.
Let’s return to the dangers of the industry, since that is something we can fundamentally understand. On page 101 stats are given about the expected fate of a gang member during a four-year period. Number of times arrested: 5.9; Number of nonfatal wounds or injuries: 2.4 (not including those given as punishment by the gang); chance of being killed: 25%. Wow, that’s depressing. Not only are these guys getting paid below minimum wage, they’re also probably going to be injured or killed. Really attractive, isn’t it? For me these were definitely the most powerful statistics of the chapter.
A final stat gave what was, in my opinion, a very insightful perspective on gangs. As if citing the likelihood of death wasn’t enough, the authors include other figures by which to compare. Sure, the statistic that the most dangerous job in the United States, as defined by the Bureau of Labor Statistics, is a timber cutter with only a 1-200 chance of being killed over 4 years (shit, that is still a lot!). No, this statistic only paved the way for this amazing revelation: A death-row inmate in Texas, the state with the highest execution rate, has only a 5% chance of death over the same period!
You know what this says to me? “Get Rich or Die Trying” is a lie. The real deal is “Get Rich, Go to Jail, and Live off Taxpayer’s Money.”
You’re safer that way.
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