Politics

The Vast Divide Between Too-Big-to-Jail and Too-Poor-to-Fight-Back

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I had a review out in this weekend's Wall Street Journal about the new book from Matt Taibbi, The Divide: American Injustice in the Age of the Wealth Gap. Here's how the review begins:

When the polemicist who made Goldman Sachs synonymous with a "vampire squid" writes a book called "The Divide," with a subtitle that references "the wealth gap," one may reasonably anticipate some undergraduate-style fist-shaking about income quintiles and the predatory rich. But one would be wrong. Matt Taibbi's "The Divide" is primarily concerned with the grotesquely unequal application of American justice, between the too-big-to-jail Wall Street elite and the too-poor-to-fight minority underclass. "The cleaving of the country into two completely different states—one a small archipelago of hyperacquisitive untouchables, the other a vast ghetto of expendables with only theoretical rights," Mr. Taibbi maintains, "is a terrible story, and a crazy one." The characterization is typically overwrought, but the general indictment is broadly correct.

And here is how it ends:

But at heart "The Divide" is a face-slap, not a legal brief. Though Mr. Taibbi doesn't couch it in these terms, his warning is all about moral hazard, in two senses of the phrase. When swindlers know that their risks will be subsidized, and their potential crimes will be punishable only through negotiated corporate settlements, they will surely commit more crimes. And when most of the population either does not know or does not care that the lowest socioeconomic classes live in something akin to a police state, we should be greatly concerned for the moral health of our society.

Reason on Taibbi here, including this 2007 interview.