The court system is absurdly underfunded, but no one is willing to pay more for it. And, unfortunately, too many people have the attitude that if you're arrested you must have done something so you're criminal scum and deserve whatever you get.
I guess your second point causes people to be biased against spending any more money, no matter how little.
Plus, the innocent who aren't jailed pay taxes and do productive things for society.
This is all ignoring the human cost of the equation.
I really look forward to when self driving cars eliminate ALL traffic cases.