Wednesday, December 14, 2011

We Have Nothing to Fear but the Status Quo Itself

Those who enjoyed (if that is the appropriate verb) Charles Ferguson’s analysis of the economic crisis through his documentary Inside Job (which, incidentally, IMDb lists under their “Crime” category, as well as under “Documentary”), should derive equal satisfaction (if not pleasure) from an article by James Kwak that just appeared on the Web site for The Atlantic.  Kwak is an Associate Professor at the University of Connecticut School of Law, which means that he is more interested in underlying legal foundations, rather than the machinations of finances explored by Ferguson.  The title of his article is “Too Big to Stop:  Why Big Banks Keep Getting Away With Breaking the Law.”

There is no spoiler in revealing that the answer to the question he poses is a simple one:  because it’s worth it.  The bottom line is that few cases of even the most egregious financial abuse are prosecuted;  and, when they are prosecuted, they are frequently settled with punishments that are barely significant.  (Ferguson discussed the almost entire lack of jail sentences.  Kwak runs the numbers on damages and reveals that those “punitive” measures barely make a dent in the balance sheets of the prosecuted institutions.)

In the immediate wake of the financial crisis, one of the popular jokes was that the best way to rob a bank was to own one.  Kwak has taken this proposition up a notch:  The best way to rob the government is to own a bank.  This is not particularly difficult, since the banks have a stranglehold on the electoral process (not to mention public opinion, which these days amounts to stifling the Occupy movements), making the chances for serious reform implemented by those who are supposed to represent us all but negligible.

Meanwhile, according to a story by Beth Duff-Brown of Associated Press, Google is going to fork out $11.5 million to fight “modern slavery;”  do they recognize the extent to which the financial sector is setting up “the 99%” for a new generation of slavery?

1 comment:

jones said...

It's not just banks. Are you familiar with the Microsoft/EU Anti-Trust case?

Microsoft was fined about $2 billion for operating in flagrant violation of EU trade laws for a decade. Because nobody goes to prison in such cases, there is little incentive to obey the law. The money spent in fines and legal fees is treated like any other business expense -- like advertising or marketing -- on the road to market domination. This is corporations assuming the privileges of personhood without the obligations.