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The New Billionaire-Criminal Class

What do Brazil, Mexico, Russia and the USA have in common?

A rapidly expanding billionaire class.

Rampant poverty.

And a distressed middle class.

That’s the take of Pulitzer prize-winning New York Times reporter David Cay Johnston in a soon to be released book–Free Lunch: How the Wealthiest Americans Enrich Themselves at Government Expense (And Stick You with the Bill) (Portfolio, December 2007).

In it, Johnston seeks to afflict the comfortable top one tenth of one percent of Americans–the 300,000 men, women and children who last year made more money than the bottom 150 million Americans.

Yes, we all have the right to vote and change this unbalanced state of affairs.

But political power in the United States is exercised by this narrow, rich segment of the population.

Much of the wealth transfer upstairs has come at the hands of corporate welfare artists who have shifted billions from the middle class to the billionaire class.

Some politician could take the central political issue of Free Lunch–wealth inequality–and run on it to the White House in 2008.

But the current crop of corporate candidates will likely ignore it so as to not offend the funding class.

While Johnston focuses on the perfectly legal schemes that bloat the richest of the richest at the expense of the rest of us, much of the thievery he documents is the result of pure un-prosecuted or under-prosecuted corporate criminality.

“One of the new rules has been to make sure there are far too few cops on the beat on Wall Street to even write down all the legitimate complaints, much less pursue more than a handful of evildoers,” Johnston writes.

“More importantly, the actions of Ken Lay and Bernie Ebbers and the others were just part of a massive shift in practices and policies that continue. The Wall Street scandals are not over. The conduct they reveled is just becoming institutionalized.”

“Thousands of executives at hundreds of companies took money from shareholders through deliberate actions that distinguish them from bandits only because they wielded pens instead of pistols,” Johnston writes. “The techniques are subtler and less overtly violent, but the results are worse, for they undermine the legitimacy of society in ways that street bandits do not. The rules allow this.”

In the book, Johnston takes shots at the corporate criminal class that would never make it by his editors at the New York Times.

“Unlike the common thief or bandit, these executives have the best and the brightest lawyers to explain away misconduct or to obfuscate.,” he writes in the book. “In the rare instances when indictments are handed up, the cheated shareholders sometimes end up paying to defend the thieves who robbed them. Added to this are the legions of publicists who are paid to report what their bosses want us to hear–the antithesis of journalism’s call to pursue the facts without fear or favor. The ranks of these image shifters are growing, while across the country a quarter or more of journalists are being fired, reducing further the chances that inconvenient facts will become known.”

“The checks and balances provided by oversight, inspection, investigation and in extreme cases, prosecution have all been gutted in the name of deregulation and shrinking the size of government,” he writes. “When there is no policeman on the beat the greatest beneficiary is not the taxpayer who is relieved of the cost of maintaining the police officer, but the thief.”

Johnston points out that we used to prosecute loan sharks. But then we got rid of usury laws and passed new laws that allow “Goldman Sachs and Lehman Brothers, MBNA and Citibank to exploit the poor, the unsophisticated and the foolish.”

“These lenders, or their fronts, can now charge rates and impose penalties that were illegal, even criminal, a generation a go,” he says.

“The result? In the last 25 years or so, one American family in seven has sought refuge in federal bankruptcy court. ” We’ve turned vices into pastimes. Case in point– gambling subsidized by money that was promised to “help the poor, the elderly and the sick.”

“In this way does Donald Trump take from the least among us to burnish his image as a supposed billionaire,” Johnston says.

In a different time, this book would climb the New York Times Best Sellers list and stay at the top for a long time. The bottom 150 million would read it and get angry.

And politics would go populist in 2008. But as of now, Clarence Thomas, Alan Greenspan, and Ann Coulter are one, two and three atop the Times non-fiction list. Johnston’s book won’t be in bookstores until December.

Time for a change.

RUSSELL MOKHIBER is the editor of the Corporate Crime Reporter.

 

 

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Russell Mokhiber is the editor of the Corporate Crime Reporter..

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