Book Review: Immunity for the rich, a police state for the poor
“The problem is, if the law is applied unequally enough over a long enough period of time, at some point, law enforcement becomes politically illegitimate. Whole classes of arrests become (circle one) illegal, improper, morally unenforceable.” — The Divide: American Injustice in the Age of the Wealth Gap, by Matt Taibbi, p. 399
We’re almost there. Perhaps we are there. America is two countries, one for bankers who commit trillion-dollar frauds but are immune from prosecution, and another that harries minorities and the poor with arrests and jailings for petty or nonexistent offenses. After reading this book — and you should read it — you will despise Eric Holder, the New York City police, and state welfare bureaucrats who pay $100 bounties to tipsters so they can fill their quota of felony welfare prosecutions.
“Something else is at work, something that cuts deeper into the American psyche. We have a profound hatred of the weak and the poor, and a corresponding terror before the rich and the successful, and we’re building a bureaucracy to match those feelings.” – Id., p. xx
America in 2015 is a country that obsesses over petty infractions — sometimes created from whole cloth — of the powerless and penniless so it doesn’t have to deal with the real crimes committed by the rich and powerful. It spends more effort and money investigating whether a single mom received $50 more food stamps than she should have, than it does on financial crimes of enormous scale and scope.
“Take just one company, Bank of America, which paid out some $29 billion in settlements between 2009 and September 2012. There was the $150 million settlement it paid to the SEC for lying to shareholders about the Merrill Lynch acquisition. There was the $600 million settlement for concealing a lack of underwriting standards in the loans put in pools mostly sold, as usual, to the defenseless elderly. There was a $3 billion settlement for defrauding Fannie and Freddie. Then there was $410 million paid for charging phony overdraft fees, $20 million paid to the DOJ for illegally foreclosing on actively serving members of the military, $11.8 billion paid out in a foreclosure settlement, $1.6 billion paid to Assured Guaranty for coaxing the insurer to wrap toxic bonds … the list goes on and on. You could make up similarly long lists for Chase, Goldman, Wells Fargo, HSBC, UBS, Deutsche Bank, Barclays, and many others. And in all but a very few of these cases, the narrative is exactly the same. There is somehow just enough evidence to extract hundreds of millions or even billions of dollars in penalties, but somehow not quite enough evidence to force any individual to do so much as a day in jail. Every single time, the state lands itself right in that oddly enormous sweet spot between spectacular leverage (to extract fines) and no leverage at all (to hand down criminal penalties).” – Id., pp. 406-407
Generally speaking, the real victims of these financial crimes don’t see a penny of that money. It inures to the benefit of the government alone, and in the context of trillion-dollar-a-year deficits, the $29 billion of fines paid by Bank of America over a 3 1/2-year period doesn’t even register. Nor did it break the bank; it merely dented its profits for a couple years. But the main point is not a single crooked banker went to jail or paid a cent out of his own pocket.
That’s the policy of the Obama administration — exchanging “Get Out Of Jail” cards for cash — and Eric Holder is the flunky who authored it and carried it out. At least he’s leaving, but don’t expect any changes under the new attorney general, because this isn’t just Holder’s policy, it’s also Obama’s policy.
On the other side of the ledger, America in 2015 is a country where cops shoot kids and pet dogs, black men die at the hands of the police for jaywalking and selling cigarettes, and greedy municipal courts shake down poor people for “crimes” like not mowing their grass or not subscribing to the city’s overpriced trash collection service.
This book tells the story of Washington Mutual gave O. J. Simpson a mortgage after he had a $33.5 million judgment entered against him, the bank’s chief legal officer flipped out when she saw that loan, but the bank sold it anyway to a Dutch pension fund. “That same year,” Taibbi writes, “the fund was forced to cut pensions for some three million workers by 0.5 percent.”
“Selling that loan into a securitized pool that would be marketed everywhere wasn’t just fraud, it was as bad as grinding horsemeat into hot dogs and sending them by the truckload to supermarkets around the world.” — Id., p. 403
Our thoroughly corrupt political system looks the other way at that kind of crime, too.
This book also tells the story of Patrick Jewell, a guy who did nothing wrong, he simply walked his girlfriend to the subway station, where he was jumped and beaten up and arrested and jailed by three undercover cops who didn’t identify themselves as cops. If you read this book, you’ll learn that New York City cops have arrest quotas to fill, too. (I’ve also seen that in other sources.)
Under our thoroughly corrupt policing and legal system, those cops won’t be prosecuted or disciplined, and Jewell can’t sue for his injuries, humiliation, and post traumatic stress disorder.
Legitimacy. Our political and legal system is fast running out of it. You can only protect and coddle the 1%, and abuse the 99%, for so long before people get their fill of it. In the America of 2015, politicians are despited, police are feared and hated, prosecutors are distrusted, grand juries are a joke. This book doesn’t dwell on tipping points, it simply says we’re approaching one; and doesn’t say what will happen when our society becomes so corrupt its social fabric is torn asunder, but we sort of know.
You really should read it.
Photo: Linda Almonte, a Chase Bank whistleblower who was fired and blacklisted. This book tells her story.