Saturday, April 17, 2021
Philly News For Your Information


No one is shocked by Matt Gaetz’s ‘skin-crawling’ sleaze — and that’s an indictment of the GOP: columnist

By PhillyNews.FYI , in News , at April 5, 2021 Tags: ,


<p>The tax code is one such example of how the rich and powerful have created a system that rewards their class with subsidies, tax breaks, write-offs and other benefits to such a grotesque extreme that <a href=”https://www.nytimes.com/2021/04/02/business/economy/zero-corporate-tax.html” rel=”noopener noreferrer” target=”_blank”>some of the country’s richest individuals, families, and corporations pay no taxes at all</a> — and in many cases actually receive “refunds” from the American people. “Job creators” and “too big to fail” are convenient shorthand to describe rent-seeking behavior and the ways many of <a href=”https://www.salon.com/2021/03/15/bandaging-the-corpse-bidens-big-bailout-cant-pull-america-out-of-its-death-spiral/” rel=”noopener noreferrer” target=”_blank”>the country’s plutocrats and other members of the elite classes</a> are economic and social parasites.</p><p>Even allowing for the fact that the nation’s laws are written to serve the interests of the rich and powerful, new reporting has shown that <a href=”https://news.yahoo.com/richest-americans-dont-report-least-054441854.html” rel=”noopener noreferrer” target=”_blank”>the top 1 percent of income earners still hide or otherwise do not report at least 20 percent of their income.</a> That theft is on a massive scale: It is <a href=”https://thehill.com/changing-america/respect/poverty/544412-ny-times-estimates-wealthy-americans-are-refusing-to-pay-14″ rel=”noopener noreferrer” target=”_blank”>estimated to cost the American people $1.4 trillion over a 10-year period.</a> The FBI also reports that so-called white collar crime <a href=”https://www.law.cornell.edu/wex/white-collar_crime#:~:text=According%20to%20the%20Federal%20Bureau,more%20than%20%24300%20billion%20annually.” rel=”noopener noreferrer” target=”_blank”>costs the American economy hundreds of billions a year. </a></p><p>This should not be a surprise, but is still shocking: <a href=”https://www.propublica.org/article/irs-sorry-but-its-just-easier-and-cheaper-to-audit-the-poor” rel=”noopener noreferrer” target=”_blank”>The IRS is much more likely to audit or otherwise investigate poor and working-class people than the rich.</a></p><p>Of course, the rich and powerful have found a way to profit from the misery, <a href=”https://www.salon.com/2021/04/01/covid-19-was-the-third-most-common-cause-of-death-in-us-last-year/” rel=”noopener noreferrer” target=”_blank”>death and destruction caused by the COVID</a> pandemic. <a href=”https://www.commondreams.org/news/2021/04/01/we-need-tax-rich-global-billionaires-have-grown-4-trillion-wealthier-during-pandemic” rel=”noopener noreferrer” target=”_blank”>The Institute for Policy Studies estimates that the world’s richest people have increased their wealth</a> — measured in the trillions of dollars — by at least 50 percent during the coronavirus plague year. </p><p>In a pre-election article for the <a href=”https://newrepublic.com/article/158582/theres-never-better-time-white-collar-criminal” rel=”noopener noreferrer” target=”_blank”>New Republic, Ankush Khardori explained</a> how the Age of Trump and its many disasters created an ideal environment for white collar criminals:</p> <blockquote> The figures, disconcerting enough on their own, tell an incomplete story. Things are even worse than they look. Three and a half years after Trump took office, white-collar criminal enforcement is in its worst state in modern history — the result of top-down disinterest in, and occasional outright hostility toward, prosecuting financial crimes; the installation of inexperienced and occasionally inept political appointees and senior officials; and enforcement priorities that are alternately misguided, inexplicable, and politically motivated. Virtually every part of the white-collar enforcement apparatus at the Justice Department is broken.<br/>As we approach the end of Donald Trump’s first term, it’s clear that it’s never been a better time to be a white-collar criminal. Amid a pandemic that shows no sign of abating, as well as an economic recession that shows all signs of getting horribly worse, the question is whether anyone — including Trump’s possible successor, Joe Biden — is going to do anything about it.<br/> </blockquote> <p>Ultimately, the Trump regime and its allies provide an almost ideal example of how rich and powerful people can abuse and break the law, <a href=”https://www.salon.com/2021/04/04/trump-could-face-legal-consequences-for-bilking-supporters-of-campaign-fundraising–analyst_partner/” rel=”noopener noreferrer” target=”_blank”>enrich themselves by doing it</a>, and face few if any consequences for their anti-social behavior.</p><p>Jennifer Taub is a legal advocate, as well as professor of law at the Western New England University School of Law. Her most recent book is “<a href=”https://bookshop.org/a/2464/9781984879974″ rel=”noopener noreferrer” target=”_blank”>Big Dirty Money: The Shocking Injustice and Unseen Cost of White Collar Crime</a>.” Her previous book was “<a href=”https://bookshop.org/a/2464/9780300212709″ rel=”noopener noreferrer” target=”_blank”>Other People’s Houses: How Decades of Bailouts, Captive Regulators, and Toxic Bankers Made Home Mortgages a Thrilling Business</a>.”</p><p>In this conversation, Taub explains how America’s two-tiered legal system encourages financial and other crimes by the very rich. She also explores how members of that group learn that behavior throughout their lives and then normalize it. In addition, Taub profiles two cases, the opioid epidemic and the 2008 mortgage crisis and financial crash, that typify the widespread harm caused by white collar crime.</p><p>Taub also reflects on a basic but powerful counterfactual: if Donald Trump had been properly punished by the law and imprisoned for the many financial and other crimes he committed earlier in life, the horror and pain caused by his presidency would likely have been avoided.</p><p><strong>There are these hope-peddlers and others in the news media and elsewhere who keep suggesting that Donald Trump may go to jail or suffer some other severe punishments for his obvious crimes. When I hear such fables, I respond with a laugh. At worst, Trump will pay a fine. Members of his cabal who may face charges will likely do the same thing and plead out. There may be civil settlements. But none of the high-level Trumpists are going to prison. Rich people do not throw other rich people in jail. The powerful rarely if ever hold each other accountable.</strong></p><p>Will Donald Trump ever go to prison? Wearing my lawyer hat, I am supposed to speak in a slow, sober tone and say that before there is even a discussion about whether Donald Trump spends any time in prison there has to be a process and a trial, and then after that, if the prosecution proves the case, then, yes, that day will come. My more honest and yet cynical answer is that there will not be enough consequences for Trump, given what he has done over his lifetime to this country, his ongoing harmful and dangerous behavior. Even if they “lock him up.”</p><p>This is not the movie The Wizard of Oz where someone is going to pour water on Donald Trump and he is just going to melt. Ivanka and Jared and the other people in Trump’s orbit and inner circle are not going to melt into a big pool of water on the floor either — and suddenly there will no longer be an oligarchy in America, or suddenly the billionaires will disappear who own most of the wealth in this country. That is not going to happen. We need to move forward. Bringing Trump to justice is not enough.</p><p><strong>What is Donald Trump an example of?</strong></p><p>Donald Trump is a perfect example of what is extruded from this unfair and sometimes corrupt system in America. Trump is somebody who is white, wealthy and well-connected and who used questionable behavior and sometimes criminal tactics to gain and sustain wealth and power.</p><p>What makes Trump unusual, in my opinion, is how high in society he climbed. Trump has been involved in potentially illegal activity for decades and was able to get away with making civil settlements.</p><p>Had Trump been held accountable before he ran for office back in 2015, he would have spent time in a federal prison instead of in the Oval Office. Trump is an example of the danger that we face as a society when we let people get by, because it’s easier just to settle than to prosecute. For many of the civil settlements involving Trump and his businesses there could have been criminal punishments. It is just easier for the government to bring civil cases and settle with people sometimes than to charge them criminally. That is the same thing that happened after the financial meltdown of 2008, where we have examples of senior bank executives who settled their cases with regulators and then avoided criminal charges.</p><p><strong>As a class of people, how are the rich different from everyone else? How does their world work?</strong></p><p>Consider a rich white kid. It is a cradle-to-grave system. People from the white suburbs go to rehab, they don’t go to jail. The cops tell you, “Turn down the music and go home.” They don’t escort you to the police station. That system of protections for the wealthy continues throughout their lives.</p><p><strong>What does that cradle-to-grave system look like?</strong></p><p>Leona Helmsley once said that “taxes are for the little people.” Spin that out more to “Laws are for the little people.” The problem with Helmsley is she said the quiet part out loud and was too mean and too greedy and so she went to a Club Fed prison for 18 months. She was the exception, not the rule.</p><p>There’s a saying accountants tell their well-to-do clients: Pigs get fat; hogs get slaughtered. Yet for every example set, there is plenty of space for the rich and white, especially rich white men, to make mistakes and be forgiven time and again. That is also a space to be predatory and have one’s behavior covered up and otherwise ignored. And it’s not just about getting away with crime, it’s also about getting by without all that much effort or merit.</p><p>It’s the ability to be of average ambition or average motivation or average performance and still be assured a safe place to live. To still be assured a decent standard of living and the respect of society and the ability to go about your life even as an adult making mistakes. They know they won’t end up living on the street because of their mistakes. It is astonishing to see how different the world of the rich is from how everyone else lives.</p><p><strong>How does America’s two-tiered legal system work in practice?</strong></p><p>We have a double standard in the American criminal justice system that reflects and perpetuates inequality. Cutting legal corners is a tool for advancement only available to the already affluent.</p><p>The wealthy not only increase their power by evading punishment, but also benefit from a criminal justice system that incarcerates those with lower social status who also attempt to use crime to get ahead. Scale that up to a multinational corporate enterprise dodging the law, and the disparities are even more stark. Corporations guilty of felonies enter into deferred prosecution and non-prosecution agreements with the government and reoffend again and again. Yet high-level executives are rarely prosecuted.</p><p>Even when the exception proves the rule, and a high-status individual is prosecuted and convicted, the double standard carries into sentencing, where statutory guidelines require judges to give serious weight to a convicted felon’s past contributions to their community. Such leniency fails to acknowledge that preemptively spreading around ill-gotten funds to charities is a con artist’s trick to gain public trust, manipulate community do-gooders and inoculate themselves. Forgiveness is often reserved for the fortunate.</p><p>The federal prison system allows wealthy offenders better conditions than ordinary convicts, with low-security camp settings for the former and dangerous caged conditions for the latter. Often, when top-shelf felons — like 1980s junk bond king Michael Milken, 1990s lifestyle guru Martha Stewart and recently released Enron CEO Jeff Skilling — complete a prison sentence, they rejoin high society with sufficient funds to rehabilitate themselves and relaunch their careers with little lasting stigma.</p><p>In 2019, the actress Lori Loughlin, indicted in the college admissions scandal known as Operation Varsity Blues, reportedly sought to hire a crisis management firm that might fashion her redemption in Martha Stewart style. In contrast, the impact of incarceration on the poor and working class can be irreversible for both the defendant and their children for years, if not generations, to come.</p><p><strong>What does justice look like in America for the rich and the poor, the elites versus everyone else?</strong> </p><p>We are all entrenched in a legal system that helps the most powerful protect their private property and contract rights. And that same system subordinates those with less resources and power.</p><p>The same system and same courts set up to oversee those types of private disputes also handle criminal matters with a similar mindset. Criminal laws as written, interpreted and enforced tend to punish far more severely those who take property from the wealthy, and let off the hook the giant enterprises and wealthy individuals who take things of value, including lives, from the middle class and poor. </p><p>To me, equal justice would mean that prosecutors would have a “collateral consequences” standard applied to ordinary people, not just business organizations, before they prosecute. We would have treatment available and not prison for drug offenders. We would also eliminate cash bail and only impose pre-trial detention on those who are a flight risk or a danger to their community or themselves. </p><p><strong>In your book, you detail how the opioid crisis is an example of criminality and lack of accountability in America for the very rich. Can you share some of those details?</strong></p><p>Purdue Pharma shows the failures on the part of the Department of Justice in terms of enforcement and repeat offending. This is a company that was prosecuted previously. In 2007, the company did plead guilty to a felony for misbranding OxyContin under the Food, Drug and Cosmetics Act. Three senior executives — none of them Sackler family members —pleaded guilty to misdemeanors. But the company continued on.</p><p>A decade after the 2007 guilty plea, the civil lawsuits brought by the states and private individuals begin. At the end of the Trump regime in 2020, Purdue Pharma pleaded guilty again as part of a DOJ settlement with the company. This time, in addition to pleading guilty to conspiracy to violate the the Food, Drug and Cosmetics Act and to defraud the United States, Purdue also pled to violating federal anti-kickback laws.There were also civil charges against the Sackler family.</p><p>But where are the criminal charges against them or other real people? This is an example of how the failure to hold individuals accountable for the crimes of the organizations they are running or participating in does not create any kind of deterrence. It is not real accountability. It completely undermines the public trust. The Sackler family made billions of dollars. They are one of the wealthiest families in America. They amassed a reported $14 billion fortune and joined the ranks of America’s 20 wealthiest families. Meanwhile, more than 232,000 fellow Americans died from prescription opioid overdoses between 1999 and 2018. All these poor and working-class people died from overdoses. The message is that some lives and families matter, and others do not.</p><p><strong>The 2008 financial collapse is another example of how the rich are not held accountable for their crimes.</strong></p><p>The nonpartisan reports on the financial crisis show that at every link of the toxic mortgage supply chain there was actual criminality. There are many who say things like, “Well, it was perfectly legal!” That is not true. There were loan originators who were encouraging people to lie on their forms. They were using whiteout to change people’s income. There was fraud throughout the process from top to bottom. Decades of deregulation helped to fuel this.</p><p>As a society we do not have to live this way. We can create a kind of shared prosperity. We can create a system where we don’t have financial bubbles, or if we do have bubbles and market downturns, the people with the least do not have to suffer the most. Likewise, the people with the most do not have to gain more wealth. This is happening right now with the so-called K-shaped “recovery.” I am grateful that the Biden administration seems to understand this problem and has responded with the COVID relief stimulus and hopefully the infrastructure bill gets passed as well.</p><p><strong>There was a recent announcement that the very rich, the top 1 percent, hide 20 percent of their income or find ways not to report it. By some estimates that may be $1 trillion dollars or more over a 10-year period that is not collected in taxes. What are the practical implications of that thievery for the average American?</strong></p><p>For example, when people are not paying what is legally required of them it means that someone else is not getting help recovering from their drug addictions, so instead they turn to crime. It means that the roads and bridges are not safe. It means that kids do not have access to preschool. Because the rich are not paying the taxes they owe and otherwise hiding income, it means that they are a de facto criminal class. The 1 percent are literally becoming wealthier and more powerful from criminal behavior. They use their influence to change the laws so that they pay fewer taxes, and this includes underfunding the IRS.</p><p><strong>What are the tax investigators and others looking for with Trump and his inner circle? What does “criminality” in that context look like?</strong></p><p>In Trump’s case, apparently both the Manhattan DA and the New York state Attorney General are looking at tax fraud under state law. More generally, the reason why tax fraud can be so prevalent is that there is a voluntary system of compliance for the most wealthy.</p><p>Ordinary people who work for a living have taxes withheld by their employers, paycheck by paycheck. The very wealthy, however, earn money in all sorts of ways that they are supposed to self-report including investment income and consulting arrangements and sales of assets like artwork or jewelry for cash. While in some cases investment firms will report to the IRS on behalf of customers, banks do not need to report incoming and outgoing payments, so there is a great deal of unreported income. So, then it’s up to the wealthy to tell the IRS truthfully and to assess losses that they can subtract from their income truthfully.</p>

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