Tuesday, July 19, 2016

The Divide: American Injustice in the Age of the Wealth Gap, by Matt Taibbi

This week I'm looking at something that's a little outside my usual bailiwick but is definitely in my recent vein of fairly recent (or in this case contemporary) events which often have to do with the world of high finance. The Divide is an expose by Matt Taibbi which shines a light on the increasing disparity between the treatment of the rich and (mostly) white versus the poor and (mostly) black, Latino, or other minorities. I will admit that there are some problems with Taibbi's book, such as a reliance on anecdotal evidence and a descent into polemics. However, Taibbi does claim and at least provide some supportive evidence of a larger, structural problems plaguing the American justice system and a worrying trend that we are moving towards greater inequality. Of course, Taibbi's dire predictions conclude we're moving towards a Soviet-style inequality and repression of basic freedoms, but it's enough to merit taking a very serious look at.

Taibbi divides his story into two parts, focusing on the extreme ends of life in America. On the one end, at the highest echelons, we have the investment bankers, lawyers, and hedge fund managers. Almost entirely white, and male, exclusively upper class and educated at the very best universities, these individuals enjoy almost unprecedented levels of wealth routinely measured in the billions. And, as Taibbi states, they routinely are involved in massive frauds, deceptions, and out and out robberies which led to the economic crisis of 2008. The exact damage done by the economic meltdown is hard to measure and it was truly global in impact, but it's measured on a magnitude of trillions of dollars. The most the government has done, however, is to levy massive fines for behaviors ranging from fraud to insider trading to money laundering for drug cartels and has followed with absolutely no criminal prosecutions of corporations or individuals. To be fair, even Taibbi admits that many of these crimes are difficult to understand, much less track and then prosecute, but the consequences for committing them are effectively non-existent.

On the other extreme you have the mostly non-white poor, recipients of welfare and increasingly treated like a criminal class in the United States. Taibbi provides examples of the African-American community in New York City, who are routinely charged with minor violations such as causing a public disturbance, a violation so broad it can include charges such as blocking pedestrian traffic, blocking vehicular traffic, and making an obscene gesture. Almost anyone can be charged with this offense, but the majority are poor and minorities who are thrown into the soul-crushing bureaucracy of the American justice system. Or there are the illegal immigrants, the majority of whom are simply trying to make a life in a better place but are unable to obtain licenses and in some cases end up being deported for being caught driving without a license. Or the thousands of cases of people on various forms of welfare whose basic protections against improper search and seizure are overturned for the ''public interest'' and in some cases are prosecuted for fraud for sums of barely over $400 and sometimes for mistakes made by the state rather than the individual. If there are no consequences for gross impropriety at the top of the scale, there are draconian consequences for doing practically nothing at the other end.

Taibbi exposes a very deep and very disturbing problem which strikes at the cherished principle of equality before the law in the United States. Certainly there hasn't been true equality before the law, that's almost certainly been a myth since the country was founded. But there was at least the strength of the myth and examples, even fairly recent ones, of corporate executives going to real, actual, factual prison for wrongdoing. However Taibbi argues that as the wealth gap has increased, the disparity between justice for rich and poor has become greater and is headed towards a dangerous pattern of corruption and repression.

Taibbi's evidence is largely anecdotal and for two reasons. One, it is far easier to inflame indignation at the injustice of systems by providing examples of people committing billion dollar frauds and getting off scot-free as well as state officials going through people's underwear drawers to see if they really deserve to be on welfare. Two, to provide an exhaustive list of the numerous examples of injustice, which definitely seem to be happening on an institutional scale, would take a lifetime of work and would probably be too late when it was completed. Yes, Taibbi's work is incomplete, but it certainly raises important questions and should prompt further research into the field.

Taibbi also takes both Clinton and Obama to task for executive policy decisions made under their administrations. Taibbi places the decisions to deregulate Wall Street and the campaign of ''welfare reform'' which stripped basic civil liberties away from people who are on welfare squarely at the feet of Clinton in an attempt to curry favor with fiscal conservatives. Taibbi also doesn't spare Obama for the extremely tepid response from the Department of Justice and the Securities and Exchange Commission in the wake of the 2008 crises. It certainly doesn't pull any punches and no one can blame him for being soft on Democratic leaders. But at the same time his vitriol spills over into the most silly of things, such as making fun of the name of the CEO of Lehman Brothers before its collapse, Dick Fuld. There are certainly plenty of things bad about Dick Fuld, but do we really need to make fun of his name?

Overall, I'm of mixed opinion on this book. On the one hand, it exposes both the corrupt excesses of Wall Street and its associates, with their massive frauds that carry absolutely no penalty. Even if they're caught. On the other, it exposes the soul-crushing reality of being poor in America and the treatment as if you're a member of a criminal class that needs to be kept in line. Something that I, as a member of upper-middle class, petite bourgeoisie America have no experience with at all. On the other hand, the book is highly polemical and shrilly warns that we're in danger of reaching Soviet Union levels of inequality in the near future. I hesitate to say that isn't possible because it almost certainly is, but I feel he may be exaggerating a tad for rhetorical effect. And while it highlights the problem there doesn't seem to be terribly many solutions. There's a lot of room for more research and definitely a lot of work to do.

- Kalpar

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