By Kevin Kelly
It is no secret that America is experiencing a crisis in wealth inequality. From this massive wealth gap also comes a dysfunctional judicial system. Many of those who occupy America’s inner cities are incarcerated, while those in America’s ruling class who have broken the law will never see the inside of a prison cell. Investigative journalist Matt Taibbi, whose reporting for Rolling Stone exposed the fraud and criminal conduct on Wall Street after the 2008 financial crisis, tackles the origins and problems of America’s criminal justice system in his latest book The Divide: American Injustice in the Age of the Wealth Gap. Taibbi and I recently spoke about how we reached that divide, and about the characters and institutions responsible for it.
The disparity in the nation’s criminal justice system far predates the 2008 economic panic. “In the ‘90s we developed this statistic-based policing strategy in a lot of big cities,” said Taibbi. “This began with The Broken Windows Approach that you might have heard of in New York where they decided that going after small crimes was the window to correcting large scale and dangerous criminal behavior. This led to preemptive large scale arrests of people for all sorts of minor things like riding down the wrong side of the road on your bicycle or having an open container. So you had that going on, on the one side, and that led to an explosion in the prison population among poor and lower class people; then, on the other side, the white collar side, there were all sorts of developments that led to it being much harder to prosecute…I think the really significant episode was the collapse of Arthur Andersen who they charged criminally for that company’s criminal role in the Enron affair…the company went out of business and 27,000 jobs were lost, and politicians freaked out and basically since then, the attitude has been well, if we can avoid bringing criminal charges against employers, then let’s find other ways to handle it.”
The Department of Justice’s inability to prosecute any of the Wall Street bankers responsible for bringing the U.S. economy to its knees is the result of an obscure memo written in the Department during the Clinton administration by current Attorney General Eric Holder. Taibbi explained: “The Holder Memo, which was written in 1999 when Eric Holder was just a lawyer in the Clinton Justice Department- originally, it was actually sort of a get tough on corporate crime document that provided prosecutors with all sorts of interesting tools for prosecuting white collar criminals, like denying them counsel and all sorts of other interesting new legal techniques, but that’s almost a postscript to this memorandum that he wrote. He basically said that if you’re going after a big company that employs a lot of people, and if there would be a lot of damage done to innocent people if you criminally prosecuted the company, then you may consider the ‘collateral consequences’ of that prosecution and seek other remedies like non-prosecution agreements, like fines, like deferred prosecution agreements, and this was created before the ‘too big to fail’ phenomenon actually happened.”
After Holder left the Justice Department, he went into private practice, working for Covington & Burling, one of the largest corporate defense firms in the world. Holder then returned to government after being appointed Barack Obama’s Attorney General. When Holder became acting Attorney General, the memo that he wrote a decade earlier went into effect, as he was tasked with dispensing “justice” to the numerous Wall Street banks. Taibbi elaborated: “…The Holder Memo becomes the law of the land and his Justice Department is faced with this problem of ‘what do we do with all of these gigantic too big to fail companies that have committed enormous crimes’ and their strategy has followed his memo. It’s basically, let’s find some other way of dealing with this apart from criminal prosecution and so they have handed out a record number of fines, but nobody has gone to jail and nobody has been indicted.”
This inequitable application of justice permeates not only Wall Street, but Washington as well. Currently, as the Senate is preparing to release some of its report on the CIA’s role in torture, not a single person has been prosecuted for his/her role in torturing detainees. James Clapper, the Director of National Intelligence, committed perjury when a Senate committee asked him if the NSA was collecting the personal data of millions of Americans. He was never held responsible. According to Taibbi, “It is totally dependent upon who you are… It’s the same problem over and over again. The torture situation- If you look back at the entire history of that issue, even predating the NSA issue that we are dealing with now, go back to Abu Ghraib, who were the only people that got prosecuted? They were low level sort of lying soldiers who served at Abu Ghraib. People who made the actual decisions that enabled any of this, not only did they never see the inside of a court room, but it was never even really discussed…James Clapper lying to Congress, we overlook that the same way we overlook the legion of Goldman Sachs witnesses who came to Congress, and they also lied, but on the other hand Barry Bonds or Roger Clemens, those are appropriate targets to go after for lying to the authorities or lying to Congress because they are high profile easier cases to make.”
This unspoken understanding that certain individuals or institutions are immune to legal consequence, warns Taibbi, has created a crisis similar to the one he personally witnessed when he was an exchange student studying in the Soviet Union. “I remember being intrigued that there were laws that everybody knew. Like, you can’t exchange dollars for rubles; you can’t buy certain kinds of foreign products. Any kind of commerce was technically against the law, and yet it was engaged in all over the place by everybody, and it occurred to me that the real laws were actually unwritten and it was all just a matter of who you were. So, if you were the director of my college, you could walk around in a $500 foreign suit you somehow got from somebody in Europe, but if you were a street kid who was trying to sell blue jeans outside of a dorm or to buy them from the exchange students, then you could be thrown in jail for that. It’s the same law. The only difference was who the person was…and I think we are moving into the same territory here in the United States. We look at certain kinds of people as being appropriate for prison and other kinds of people as being inappropriate candidates to be in prison.”
Matt Taibbi’s transition from Rolling Stone to First Look Media has changed neither his mission nor his determination to challenge the accountability of those in Washington, Wall Street, and the media. In an age when most journalists are content to chase sensationalist headlines and to act as stenographers for the ruling class in anticipation of reward, Taibbi chooses a much less popular, less traveled road–that of an advocate of the people, in the company of such brilliant thinkers as novelist George Orwell who offered: “When I sit down to write a book, I do not say to myself, ‘I am going to produce a work of art.’ I write because there is some lie that I want to expose, some fact to which I want to draw attention, and my initial concern is to get a hearing.”
Kevin Patrick Kelly is a University student majoring in History and Political Science. Previously, he was a columnist for the Washington Times Communities. Follow him on Twitter @TheKevinPKelly.
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