As a litigator who practiced for more than a decade in federal and state courts across the country, I’ve long been aware of the inequities that pervade the American justice system. The rich enjoy superior legal representation and therefore much better prospects for success in court than the poor. The powerful are treated with far more deference by judges than the powerless. The same cultural, socioeconomic, and demographic biases that plague society generally also infect the legal process. Few people who have had any interaction with the justice system would dispute this. ..... (Glen Greenwald "With Liberty And Justice For Some" p.1)
Still, only when I began regularly writing about politics did I realize that the problem extends well beyond such inequities. The issue isn't just that those with political influence and financial power have some advantages in our judicial system. It is much worse than that. Those with political and financial clout are routinely allowed to break the law with no legal repercussions whatsoever. Often they need not even exploit their access to superior lawyers because they don't see the inside of a courtroom in the first place—not even when they get caught in the most egregious criminality. The criminal justice system is now almost exclusively reserved for ordinary Americans, who are routinely subjected to harsh punishments even for the pettiest of offenses.
The wiretapping scandal of 2005 provides a perfect illustration. In December of that year, the New York Times revealed that officials in George W. Bush's administration were eavesdropping on Americans' telephone calls and e-mails without warrants or judicial oversight: a felony punishable by up to five years in prison and a ten-thousand-dollar fine for each offense. The lawbreaking could not have been clearer, yet virtually nobody in the political and media class was willing to call those acts "criminal," much less to demand legal investigations or prosecutions.
This was a depressingly familiar pattern for several decades and became particularly pronounced over the last one. America's political and business establishment presided over a series of extraordinary crimes that brought the United States political disgrace and financial ruin: the creation of a global torture regime; the systematic plundering by Wall Street, leading to the 2008 economic crisis; the serial obstruction of justice by high-ranking political officials; the fraudulent home foreclosures by the nation's largest banks. Yet in almost every instance, the perpetrators were shielded from any legal consequences. As these events clearly demonstrate, America's political culture not only provides strategic advantages in the legal system to political and financial elites, but now actually grants them immunity when they knowingly break the law. This license—awarded by the same political class that created the world's largest and most merciless prison state for its poorest and most powerless citizens—represents not just a departure from the rule of law but a fundamental repudiation of it.
The central principle of America's founding was that the rule of law would be the prime equalizing force, the ultimate guardian of justice. The founders considered vast inequality in every other realm to be inevitable and even desirable. Some would be rich, and many would be poor. Some would acquire great power, and many would live their entire lives virtually powerless. A small number of individuals would be naturally endowed with unique and extraordinary talents, while most people, by definition, would be ordinary. Due to those unavoidable circumstances, the American conception of liberty was not only consistent with, but premised on, the inevitability of outcome inequality—the success of some people, the failure of others.
The one exception was the rule of law. When it came to the law, no inequality was tolerable. Law was understood to be the sine qua non ensuring fairness, a level playing field, and a universal set of rules. It was the nonnegotiable prerequisite that made all other forms of inequality acceptable. Only if everyone was bound to the same rules would outcome inequality be justifiable.
So central is this founding principle that most Americans absorb it by osmosis via numerous clichés: All are equal before the law. Justice is blind. No man is above the law. We are, in the words of John Adams, "a nation of laws, not men." For Adams, either the law is supreme in all cases, or the arbitrary will of rulers is. Adams and the other founders viewed the preeminence of law over individuals—all individuals—as the only protection against the tyranny that American colonists had launched a revolution to abolish. For that reason, American political liberty was always inextricably bound to the notion that law reigns supreme.
It would be difficult to overstate the essential place of the rule of law in the American political tradition. A principal grievance against King George III was his unilateral power to vest in himself and those he favored the right to act outside of the law. The goal of the American Revolution was to replace this arbitrary will of the monarch with unbending equal application of law to everyone. "Where, say some, is the King of America?" Thomas Paine, the great American revolutionary, asked in his 1776 pamphlet Common Sense. His answer:
Let a crown be placed thereon, by which the world may know, that so far as we approve of monarchy, that in America the Law is King. For as in absolute governments the King is law, so in free countries the law ought to be King; and there ought to be no other.
Alexander Hamilton did not often see eye to eye with Paine, but on this he heartily agreed. "The instruments by which [government] must act are either the AUTHORITY of the laws or FORCE," he wrote in 1794. "If the first be destroyed, the last must be substituted; and where this becomes the ordinary instrument of government there is an end to liberty!" Like Paine and Hamilton, Adams, in his 1776 Thoughts on Government, put the rule of law at the top of his list of core principles for a free and legitimate government: "The very definition of a republic is ‘an empire of laws, and not of men.' . . . Good government is an empire of laws."
That last line may at first glance appear simple and even trite, but it contains a critical insight. The supremacy of law is not just one among many instruments of good government; it is good government itself. The converse is equally true: in the absence of the rule of law, good government cannot be said to exist.
To be sure, there may be exceptional situations where the rule of men might produce better outcomes than the rule of law. A truly magnanimous tyrant, a benevolent dictator, might conceivably lead to more positive results than a regime of unjust laws rigidly applied. Historians can point to emperors who exercised absolute power while advancing the interests of their subjects and the territories they ruled. Nevertheless, such societies should not be confused with "good government," dependent as they are on the fortuitous emergence of an unrestrained leader who is both well-intentioned and relatively immune from the corrupting effects of power (and, even less plausibly, immune from the absolutely corrupting effects of absolute power). A country that prospers by vesting absolute power in a leader who happens to be benevolent could just as easily come under the control of a malevolent leader the next time around. And when that happens, as at some point it surely will, a society without the rule of law will have no means of redress short of violent revolution.
What's more, even the most well-intentioned leader will eventually abuse his power if he is not constrained by law. Indeed, and somewhat paradoxically, a ruler's belief in his own virtue actually renders abuses of power more likely, since he can rationalize all manner of arbitrary and capricious measures: I am good and doing this for good ends, and it is therefore justifiable. Power exercised corruptly inevitably degrades and destroys even genuinely benevolent intent.
The founders understood that magnanimity is very rarely an enduring safeguard against the corrupting influences of power, and because they understood this, they insisted on the rule of law as the only effective weapon against such temptations. "Why has government been instituted at all?" Hamilton asked in Federalist 15. "Because the passions of men will not conform to the dictates of reason and justice without constraint." Thomas Jefferson wrote in 1798: "In questions of power, then, let no more be heard of confidence in man, but bind him down from mischief by the chains of the Constitution." Adams, in 1772, put it this way: "There is danger from all men. The only maxim of a free government ought to be to trust no man living with power to endanger the public liberty." Four years later, his wife, Abigail, memorably echoed the same sentiment in a letter to him: "Remember, all men would be tyrants if they could."
The rule of law does not guarantee good government: an empire of unjust laws can be as tyrannical as an empire of men, perhaps even more so. But though the rule of law is not sufficient by itself to ensure a just and free society, it's absolutely necessary for it. For that reason, a nation that renounces the rule of law has rendered tyranny not only likely but inevitable.
The fundamental requirement of the rule of law is equality: the uniform application of a set of preexisting rules to everyone, including the rulers. But like the term rule of law, equality under the law has become merely a platitude, a phrase recited without much appreciation of its significance. Everyone claims to believe in it, but hardly anyone remembers what it means. And yet the demand that all be treated equally under the law was no secondary concept to the founding of the United States, but its crux, and it is not difficult to understand why.
What the founders feared most was that a centralized federal government would unwittingly replicate the abuses they had suffered under the king. Unless aggressively constrained, a federal government could erode every precept of liberty that they were attempting to enshrine. It could forcibly override local rule, obliterate self-governance, and, through its sheer weight, transgress every limit. Preventing the government from succumbing to the temptations inherent in its power was the founders' central concern when they were creating the Constitution.
Of course, the law itself also wields tremendous power. The legal system's reach is unparalleled: it can deprive a person of property, liberty, even life. It may compel people to transfer their material goods to others, block them from engaging in planned actions, destroy their reputations, consign them to cages, or even inject lethal chemicals into their veins. Unequal application of the law is thus not merely unjust in theory but devastating in practice. When the law is wielded only against the powerless, it ceases to be a safeguard against injustice and becomes the primary tool of oppression. Unjust acts perpetrated in defiance of the law are relatively easy to fight against, but unjust acts perpetrated under cover of law are much harder to challenge. Thus, not only does unequal application of law result in the loss of something good and necessary; it becomes a potent means for entrenching and protecting exactly that which law is designed to prevent.
In his 1795 essay Dissertations on First Principles of Government, Paine thus insisted that "the true and only true basis of representative government" is equal application of law to all citizens: rich and poor, strong and weak, powerful and powerless, landowner and tenant. Without equal application of the laws, Benjamin Franklin warned in his 1774 Emblematical Representations, society would fracture into two tiers: the "favored" and the "oppressed." The result, he said, would be "great and violent jealousies and animosities" between these classes, and a "total separation of affections, interests, political obligations, and all manner of connections, by which the whole state is weakened."
Revealingly, the central function of the Constitution as law—the supreme law—was to impose limitations not on the behavior of ordinary citizens but on the federal government itself. The government, and those who ran it, were not placed outside the law, but expressly targeted by it. Indeed, the Bill of Rights is little more than a description of the lines that the most powerful political officials are barred from crossing, even if they have the power to do so and even when the majority of citizens might wish them to do so.
The vital aim of law, then, was to ensure that the powerful were subjected to its dictates on equal terms with the powerless. As Jefferson put it in an April 16, 1784, letter to George Washington, the foundation on which any constitution must rest is "the denial of every preeminence." In his 1786 Answers to Monsieur de Meusnier's Questions, Jefferson argued that the essence of America was that "the poorest laborer stood on equal ground with the wealthiest millionaire, and generally on a more favored one whenever their rights seem to jar." Even Hamilton, who made no attempt to conceal his belief in a strong executive, argued in Federalist 71 that the president had to be "subordinate to the laws." The notion of law simply makes no sense, and has no good purpose, unless all are bound by its dictates.
The dangers of abandoning this principle were well recognized. In Federalist 57, James Madison emphasized that equal application of the law to political elites was a prerequisite for a free and cohesive society ("one of the strongest bonds by which human policy can connect the rulers and the people together"), and warned that in its absence "every government degenerates into tyranny." Perhaps most tellingly of all, the founder who was the least philosophically inclined but the most practiced in the exigencies of governance—George Washington—vowed, in a letter written in December 1795, that there would never be immunity for wrongdoing by high government officials on his watch: "The executive branch of this government never has, nor will suffer, while I preside, any improper conduct of its officers to escape with impunity."
What the founders recognized was that unless the law were applied equally, subjecting all citizens to its mandates, the Constitution would simply consist of a set of guidelines or suggestions, compliance being optional. In view of that danger, equal enforcement was embedded in formal American jurisprudence from early on as the linchpin of the rule of law. The seminal 1803 Supreme Court case Marbury v. Madison is widely remembered for having established the foundation for how the U.S. government functions: Congress enacts laws, the president executes them, and the courts "say what the law is." But the Supreme Court's ruling was just as meaningful for what it signaled about how the principle of equality under the law would work in practice. The central dispute in Marbury was whether the courts had the authority to subject officials in the executive branch to their rulings—that is, whether officials who violated the law could be compelled to submit to judicial decrees. The court's unanimous decision announced that the judicial branch had not only the right but the duty to enforce the law on all citizens, including high-level officials in the executive branch. "The very essence of civil liberty certainly consists in the right of every individual to claim the protection of the laws," the chief justice wrote.
What makes the founders' insistence on equality under the law all the more striking is that none believed in equality as a general proposition. Indeed, the opposite is true: they considered inequality on every level, other than in law, to be the natural, inevitable, and just state of affairs. Even Jefferson, one of the most egalitarian of the founders, held that there was "a natural aristocracy" among men, based on "virtue and talents." And he saw its existence as not only inevitable but desirable: "The natural aristocracy I consider as the most precious gift of nature for the instruction, the trusts, and government of society." Similarly, for Adams, inequality was both inevitable and natural, even divinely ordained: "It already appears, that there must be in every society of men superiors and inferiors, because God has laid in the constitution and course of nature the foundations of the distinction." Yet the founders concurred that nothing constituted a greater threat to the Republic than to allow this inequality of wealth or political power to determine the treatment of citizens before the law. In particular, they disdained superior and inferior positions imposed by the state rather than determined by merit. Paine, for instance, loathed inherited titles on the ground that they doled out rewards based on assigned status rather unrelated to entitlement. He declared:
Nature is often giving to the world some extraordinary men who arrive at fame by merit and universal consent, such as Aristotle, Socrates, Plato, etc. They were truly great or noble. But when government sets up a manufactory of nobles, it is as absurd as if she undertook to manufacture wise men. Her nobles are all counterfeits.
To Paine, a system of legally enforced inequality would enable the elite to exploit the law to entrench unearned prerogatives or shield ill-gotten gains. And those counterfeit nobles would turn the law into a tool to promote and protect injustice rather than to correct it. Though Paine's liveliest polemics were devoted to scorning the accumulation of wealth, he had no quarrel with income inequality provided that there was no such inequality under law. The rich could buy what they desired, dress and eat as they wished, and wallow in the most effete comforts and luxuries. But the law was the one realm where their money and property would count for nothing.
One point is vital to acknowledge: like all of the other principles espoused by the founders, equality under the law was not always observed in practice. Indeed, it was often violently breached from the very beginning of the Republic. Slavery, the dispossession of Native Americans, the denial of voting rights to women, and the granting of superior legal rights to property owners are a few of the most glaring deviations.
But even when the principle of equal treatment was betrayed, American leaders in every era have emphatically affirmed it, not so much out of hypocrisy as out of aspiration. Indeed, for those who were devoted to justice, the persistence of inequality was precisely what made equality before the law so imperative. Over time, this principle would provide the road map for eradicating injustice. It was the impetus for the abolition of slavery; the enactment of the Fourteenth Amendment, with its overarching guarantee of "equal protection of the laws"; the enfranchisement and empowerment of women; the civil rights movement; enhanced protections for the poor in the criminal justice process; and numerous other legal and social reforms of the last two centuries.
Today, equal application of the law remains a sacrosanct principle among virtually all legal theorists. Contemporary scholars routinely emphasize that the rule of law cannot exist without legal equality. As the constitutional legal scholar Michel Rosenfeld argues, the rule of law is not merely weakened if the ruler and his or her associates consistently remain above the law"; it ceases to exist by definition. When the powerful can effectively exempt themselves from law's punishments, we live under "the rule of men," even if we maintain a facade of laws and other trappings of a legal system, such as courts, legislatures, and judges. Indeed, it's nearly impossible to find a definition of the rule of law that does not contain some requirement that the law be applied equally. As Judge Diane Wood, of the Seventh Circuit Court of Appeals, observes, the consensus view is that "there is no one in a society governed by law who is above the law or immune from some form of legal constraint."
This conception is practically universal, certainly in the West. In the early 1990s, the World Bank and International Monetary Fund announced that any states wishing to receive financial assistance were required to respect the rule of law, prompting debate over what exactly that entailed. In a 1998 essay in Foreign Affairs, Thomas Carothers of the Carnegie Endowment for International Peace articulated the standard used by the Western world to dictate to developing nations what the rule of law minimally demands. The rule of law, he wrote, is "a system in which the laws . . . apply equally to everyone." Unless the political and financial elites are subject to the same laws as everyone else, he argued, there could be no rule of law—only its trappings. He cited Latin America, Asia, the former Soviet Union, and parts of the former Eastern bloc as examples of "the ruling elite's tendency to act extralegally" wherever "legal systems remain captive of the powers that be." The most crucial challenge in developing countries, as Carothers put it, is that elites "must give up the habit of placing themselves above the law."
We face a similar challenge in the United States today. For all the homage we pay to equality under law, we have virtually abolished it in practice. Indeed, beyond isolated, politically motivated rhetoric, we hardly even pretend to believe in its validity any longer. Instead, the United States now has the exact opposite of a single set of laws before which everyone is equal. It has an entrenched two-tiered system of justice: the country's most powerful political and financial elites are virtually immunized from the rule of law, empowered to commit felonies with full-scale impunity and to act without any constraints, while the politically powerless are imprisoned with greater ease and in far greater numbers than in any other country on the planet.
Over the past several decades, we have witnessed numerous examples of serious lawbreaking on the part of our most powerful political and financial leaders with no consequences of any kind. It is no exaggeration to state that the current consensus among journalists and politicians is that except in the most blatant and sensationalistic cases (typically ones in which other powerful factions are aggrieved—a Bernie Madoff here, a Rod Blagojevich there), criminal prosecutions are simply not appropriate for the country's elites. Courtrooms, indictments, and prisons are there for ordinary Americans, not for the ruling classes, and virtually never for our highest political leaders.
The central promise of the American founding—that all would stand equal before the rule of law no matter what other political and economic inequality was allowed—has been abandoned. Two features of contemporary American political life are particularly significant in this regard. First, the elites' exemption from the rule of law has been strengthened at exactly the same time that the law has become an increasingly draconian instrument of punishment for the rest of Americans—particularly the poor and racial minorities. Not only does the law fail to equalize the playing field; it perpetuates and even generates tremendous social inequality.
Second, though unequal application of the law has always been pervasive in American society, until recently such inequality was regarded as a problem: something to be deplored and, if possible, corrected. Today, however, substantial factions in our political culture explicitly renounce the principle of legal equality itself. It is now quite common for American political discourse to include arguments expressly justifying the elites' legal impunity and openly calling for radically different treatment under the law for various classes of people based on their power, status, and wealth.
Historically, our collective insistence on the principle of equality under law has been principally responsible for our forward progress, our ability to identify and eliminate major and minor transgressions. Conversely, our abandonment of that principle precludes such progress and, worse, shields legal inequality from reform. A society that demands equality under the law will move inexorably toward it. A society that renounces this virtue will move in the opposite direction. We have, manifestly, become a society that no longer even rhetorically affirms the necessity for this equality, and the outcome is exactly as dangerous, oppressive, and antidemocratic as the American founders warned it would be. (Glen Greenwald "With Liberty And Justice For Some" p.1)
But the most glaring falsehood in Klein’s Libby defense is also the most significant for our purposes: namely, his claim that “perjury” is something for which people are not convicted and imprisoned unless they are “celebrities,” and that Libby was being persecuted because of his elevated position. In fact, the opposite is true: many far less famous or powerful Americans have been sent to prison or otherwise punished for the crimes of obstruction of justice and perjury. Here are just a few illustrative examples.
“The United States Attorney in Manhattan, Rudolph W. Giuliani, declared yesterday that the one-year prison sentence that a Queens judge received for perjury was ‘somewhat shocking.’ ‘A sentence of one year seemed to me to be very lenient,’ Mr. Giuliani said, when asked to comment on the sentence imposed Wednesday on Justice Francis X. Smith, the former Queens administrative judge” (New York Times, September 11, 1987).
“A Boston police officer was sentenced late yesterday to 2 years and 10 months in prison after being convicted in federal court for perjury and obstruction of justice during a grand jury investigation of the unlawful beating of a fellow plain clothes police officer” (Business Wire, September 30, 1998).
“Still insisting that he never took a payoff or tried to hide evidence, former East St. Louis Police Chief Ronald Matthews began serving 33 months in prison Monday after a judge sentenced him for obstruction of justice and perjury” (St. Louis Dispatch, March 21, 2006).
Clearly, Klein and other media defenders of Libby have it exactly backward: it is not uncommon for people to be punished for obstruction of justice and perjury. What is uncommon is for anyone to pay attention when it happens, let alone object on their behalf, because they typically are not people with powerful connections.
Klein’s indignation over Libby’s unfair treatment was echoed by many in the establishment media. The former Time editor in chief Norman Pearlstine wrote a book denouncing Fitzgerald’s investigation, while the New York Times columnist David Brooks condemned the prosecution in multiple venues as a “farce.”
But perhaps the most revealing pro-Libby defense came from the Washington Post’s Richard Cohen, who—as we just saw—had gleefully celebrated the pardon bequeathed to his “Safeway buddy” Caspar Weinberger. Cohen’s June 2007 defense of Libby was a true tour de force of apologia, highlighting the function of our Beltway media stars when it comes to elite immunity. Grieving over what he considered the grave and tragic injustice brought down upon the newly convicted felon, Cohen unleashed a paragraph that perfectly captures how many establishment journalists view their role vis-à-vis top political leaders.
With the sentencing of I. Lewis “Scooter” Libby, Fitzgerald has apparently finished his work, which was, not to put too fine a point on it, to make a mountain out of a molehill. At the urging of the liberal press (especially The New York Times), he was appointed to look into a run-of-the-mill leak and wound up prosecuting not the leaker—Richard Armitage of the State Department—but Libby, convicted in the end of lying. This is not an entirely trivial matter since government officials should not lie to grand juries, but neither should they be called to account for practicing the dark art of politics. As with sex or real estate, it is often best to keep the lights off.
Just as Klein did, Cohen managed to pack multiple falsehoods into his Libby defense. He told his readers, for instance, that a special prosecutor was appointed to investigate the Plame leak “at the urging of the liberal press,” and later on in the column he pinned the blame for Libby’s terrible plight on “antiwar sanctimony,” “an unpopular war,” “opponents of the Iraq war,” and “a vestigial Stalinist-era yearning for abasement.” Somehow, Cohen attributed Libby’s prosecution to left-wing culprits even though the investigation began when a complaint was filed by the CIA, proceeded when the Bush DOJ appointed a GOP prosecutor, and then ended when a Bush 43–appointed federal judge sentenced Libby to prison. (Glen Greenwald "With Liberty And Justice For Some" p.43-5)
A 2009 study conducted by Joris Lammers at Tilburg University in the Netherlands and by Adam Galinsky at Northwestern University in Illinois sought to determine how power and powerlessness affect a person’s moral pliability. The researchers found that those in positions of power not only violate rules much more readily but feel far less contrition about their violations because their power leads them to a consuming, blinding sense of entitlement. As the Economist summarized the study’s findings: “Powerful people who have been caught out often show little sign of contrition. It is not just that they abuse the system; they also seem to feel entitled to abuse it.” Further, “people with power that they think is justified break rules not only because they can get away with it, but also because they feel at some intuitive level that they are entitled to take what they want. This sense of entitlement is crucial to understanding why people misbehave in high office. In its absence, abuses will be less likely. The word ‘privilege’ translates as ‘private law.’”
During the Bush 43 years, the culture of elite lawlessness slouched toward its most extreme, though logical, conclusions. The Bush administration expressly adopted the theory that the president is greater than the law, that his obligation to protect the nation means that nothing can limit what he does—not even the laws enacted by the American people through their Congress.
Indeed, during the Bush presidency, the Harvard professor of government and well-known neoconservative Harvey Mansfield published an article in the Weekly Standard perfectly summarizing the dominant view of America’s political and media class. Mansfield wrote that our “enemies, being extra-legal, need to be faced with extra-legal force”; that the office of the president is “larger” than the law; that “the rule of law is not enough to run a government”; that “ordinary power needs to be supplemented or corrected by the extraordinary power of a prince, using wise discretion”; and, most shockingly, that the American legal system is so constraining that it suggests the need for “one-man rule.” Mansfield’s advocacy may have been starker than most, but it was far from unusual. Its fundamental premise—that elites are the owners of law and thus cannot really violate it—echoes Nixon himself, who infamously told David Frost in a 1977 interview, “When the president does it, that means it is not illegal.”
In response to Bush-era declarations of elite lawlessness and presidential omnipotence, our sober guardians of political wisdom shrugged. Those who objected too strenuously, who used terms such as criminal and illegality or who raised the specter of impeachment—one of the tools created by the founders to redress executive lawbreaking—were branded as radicals, as unserious, partisan hysterics. The only crime recognized by official Washington was using impetuous or excessively irreverent language to object to the lawbreaking and radicalism of the Leader, or acting too aggressively to investigate them.
Bush 43 and his followers knew that they could freely break the law because our Washington establishment, our “political press,” would never object too strenuously, if at all. During the Bush presidency, the American media directed its hostility almost exclusively toward those who investigated or attempted to hold accountable the most powerful members of our political system; hence their attacks on the GOP prosecutor investigating the Bush administration’s crimes, their anger at the very few investigative reporters trying to uncover Washington’s secrets, and their righteous condemnation of each of the handful of attempts by Congress to exercise investigative oversight of the administration. (Glen Greenwald "With Liberty And Justice For Some" p.48-9)
In deference to the telecoms’ primary concern that their duties be clearly spelled out, and that they not end up suffering liability for accidental violations, Congress included broad immunity provisions in these statutes. Specifically, with regard to any criminal or civil accusations against the telecoms, FISA and the other laws provided full-scale amnesty in the event that telecoms could show that they acted in good faith—that even if they violated the law, they did not do so knowingly. Section 2520 of Title 18 of the U.S. Code created as broad and absolute an immunity provision as could be imagined: it provided that a demonstration of good faith by the telecoms “is a complete defense against any civil or criminal action brought under this chapter or any other law.” In other words, under the laws in place at the time the illegal spying began, the only situation in which telecoms could be sued or prosecuted for working with the government was when they clearly and knowingly violated their legal duties to their customers and the country by enabling plainly illegal government spying.
When the Bush administration originally approached the telecoms about cooperating with its new warrantless eavesdropping program—and there are credible reports that some of these discussions took place prior to 9/11—a small handful of the companies emphatically refused. They did so based on their conviction that the proposed program was so obviously illegal that taking part in it would leave them outside the scope of the statutory immunity rights conferred by Congress.
One company that refused was Qwest. To see just how reckless most telecoms were in deliberately violating the law, consider what motivated Qwest’s refusal, as reported by USA Today.
Qwest’s CEO at the time, Joe Nacchio, was deeply troubled by the NSA’s assertion that Qwest didn’t need a court order—or approval under FISA—to proceed. Adding to the tension, Qwest was unclear about who, exactly, would have access to its customers’ information and how that information might be used….
Unable to get comfortable with what NSA was proposing, Qwest’s lawyers asked NSA to take its proposal to the FISA court. According to the sources, the agency refused.
The NSA’s explanation did little to satisfy Qwest’s lawyers. “They told (Qwest) they didn’t want to do that because FISA might not agree with them,” one person recalled. For similar reasons, this person said, NSA rejected Qwest’s suggestion of getting a letter of authorization from the U.S. attorney general’s office. A second person confirmed this version of events.
But the rest of the telecom industry had no such qualms about FISA. In fact, the government even attempted to pressure Qwest by telling the firm that “it was the lone holdout among the big telecommunications companies.” Most telecoms had readily agreed to cooperate fully with the government’s illegal program, lured by the mammoth profits to be earned from the growing surveillance state. To induce Qwest to capitulate, Bush officials threatened it with the possibility of losing government contracts. As USA Today explained: “In addition, the agency suggested that Qwest’s foot-dragging might affect its ability to get future classified work with the government. Like other big telecommunications companies, Qwest already had classified contracts and hoped to get more.”
As the Qwest case demonstrates, telecoms had the option to refuse to participate in the NSA program and thus abide by the law. Yet most of them chose not to. The evidence seems clear that virtually the entire American telecom industry—AT&T, Sprint, Verizon, BellSouth, and numerous others—broke the law by allowing the U.S. government to invade their customers’ private communications without the warrants required by the federal statutes that the telecoms themselves had actively participated in writing. And it is not insignificant that their actions generated hundreds of millions of dollars in government surveillance contracts. (Glen Greenwald "With Liberty And Justice For Some" p.60-1)
Back in 2003, Rockefeller had been one of the tiny handful of senators who were informed by the Bush administration about the warrantless spying on Americans. At the time, he did nothing other than send a short, meaningless handwritten letter to Dick Cheney expressing “concerns.” But his concerns—along with the anger he had publicly expressed regarding his inability to learn anything about the spying program—quickly evaporated. Indeed, by the fall of 2007 Rockefeller emerged as the most vocal congressional advocate for full telecom immunity; as the New York Times reported, he jointly created a proposal for such immunity directly with Dick Cheney. With the Bush White House and Director of National Intelligence McConnell already fully on board, the telecoms’ ability to secure the support of the key Democratic senator on intelligence issues was a major coup.
The reason for their success is not difficult to understand. In October 2007, Wired wrote an article about Rockefeller titled “Democratic Lawmaker Pushing Immunity Is Newly Flush With Telco Cash.” It documented that as Rockefeller was “steering the secretive Senate Intelligence Committee to give retroactive immunity to telecoms that helped the government secretly spy on Americans,” he was the recipient of a substantial increase in telecom money. If he wanted to stay in the Senate, Rockefeller was required to run for reelection in 2008, and the Wired article, using public finance records, detailed how much assistance the telecom industry was suddenly providing.
Top Verizon executives, including CEO Ivan Seidenberg and President Dennis Strigl, wrote personal checks to Rockefeller totaling $23,500 in March, 2007. Prior to that apparently coordinated flurry of 29 donations, only one of those executives had ever donated to Rockefeller (at least while working for Verizon).
In fact, prior to 2007, contributions to Rockefeller from company executives at AT&T and Verizon were mostly nonexistent.
But that changed around the same time that the companies began lobbying Congress to grant them retroactive immunity from lawsuits seeking billions for their alleged participation in secret, warrantless surveillance programs that targeted Americans.
The Spring ’07 checks represent 86 percent of money donated to Rockefeller by Verizon employees since at least 2001.
AT&T executives discovered a fondness for Rockefeller just a month after Verizon execs did and over a three-month span, collectively made donations totaling $19,350.
AT&T Vice President Fred McCallum began the giving spree in May with a $500 donation. 22 other AT&T high fliers soon followed with their own checks.
Wired included two charts to illustrate the telecom industry’s sudden fondness for Rockefeller.
The significance of these donations extends far beyond mere money. To be sure, the money matters. Although Jay Rockefeller lives off a vast family fortune, after he was first elected to the Senate—which he accomplished by flooding his small West Virginia state with $12 million of his own money—Rockefeller vowed that he would never again spend personal funds on a political race. Like most other politicians, then, Rockefeller relies upon donors to maintain his political power.
But beyond that, these endless interactions between senators and the executives, lawyers, and lobbyists for large corporations also create a culture, a community, that is closed to those who cannot afford the admission fee—namely, the vast majority of Americans. With donations comes access; after AT&T and Verizon delivered large checks to Senator Rockefeller, for example, they were able to hold a cocktail party attended by numerous key Democrats. Similarly, lobbyists are almost always former officials in Congress or the executive branch and thus friends of those who are still in political office. Soon enough, lawmakers find themselves spending most of their time with representatives of the corporations that fund their careers and that have the power to end them. Such communion only further accelerates the intermingling of government and private industry. The public/private merger exists not only on the tangible levels of policy and money but on intangible—though equally potent—social, cultural, and socioeconomic levels as well.
Providing crucial support to this army of corporations and lobbyists was, as usual, the establishment media. In 2008, the vast majority of establishment journalists emphatically advocated for telecom immunity. The self-proclaimed watchdogs over power thereby yet again devoted themselves to suppressing facts, quashing investigations, and demanding protection for elites from all accountability. They did so by invoking the same batch of clichés now hauled out every time elite immunity is to be sold to the public.
The Washington Post’s David Ignatius casually proclaimed, as though it were the most natural thing in the world: “A key administration demand is retroactive immunity for telecommunications companies that agreed to help the government in what they thought was a legal program. That seems fair enough.” Time’s Joe Klein cast the telecoms as the victims in need of protection: “I have no problem with telecommunications companies being protected from lawsuits brought by those who may or may not have been illegally targeted simply because the Bush Administration refused to update the law.” The Washington Post editorial page repeatedly urged the granting of immunity, claiming—in perfect lockstep with McConnell and other Bush officials—that telecoms could not afford the liability to which they would be subjected, that their cooperation was urgently needed to keep us safe from terrorists, and that it was terribly unfair to punish them for having unquestioningly complied with the president’s requests (“the telecommunications providers seem to us to have been acting as patriotic corporate citizens in a difficult and uncharted environment”).
Perhaps most tellingly, the Washington Post editorial page actually argued that it was unfair to subject telecoms to the “high costs” of defending against these lawsuits—meaning their attorneys’ fees. In October 2007, they demanded amnesty, arguing, “We do not believe that these companies should be held hostage to costly litigation in what is essentially a complaint about administration activities.” (Glen Greenwald "With Liberty And Justice For Some" p.88-91)
In late June, the Democratic-controlled House passed a new FISA bill that vastly expanded the warrantless eavesdropping powers of the government, in the process legalizing most of what had previously been illegal. On July 9, 2008, the U.S. Senate did the same. Titled the FISA Amendments Act of 2008, the bill also granted full retroactive immunity, both civil and criminal, to the entire telecom industry, thus guaranteeing an end to the multiple lawsuits that had been filed against them. All possibility for further investigation into the massive spying program, and for a judicial review of its legality, permanently ended on that day.
The bill passed with the support of virtually the entire Democratic congressional leadership. Barack Obama, by then the Democratic nominee for president, blatantly violated his vow to filibuster any bill containing telecom immunity. Instead, he voted against the Dodd-sponsored filibuster; with the filibuster defeated, Obama then voted in favor of the underlying bill itself. (Hillary Clinton, no longer a presidential candidate, fulfilled her campaign promise by voting against it.) The vote in the Democratic-controlled Senate was not even close: 69–28 in favor of the bill. The vote in the House was similarly lopsided (293–129), with Democrats evenly split but with the entire Democratic leadership—including Speaker Nancy Pelosi, Majority Leader Steny Hoyer, and Rahm Emanuel—supporting the bill.
The day after the Senate vote, President Bush celebrated the harmless end to a scandal that began almost three years earlier when the New York Times told the nation that he had been illegally spying on American citizens for years. He invited numerous leaders of both political parties to the White House for the ceremony at which the new FISA bill was signed into law. Those members of Congress mingled with Admiral McConnell and the other national security officials who had worked so tirelessly to ensure that telecoms (and therefore the president) would be shielded from all liability. In his remarks, the president heaped particular praise on Senator Rockefeller for leading the way in ensuring the bill’s passage.
Very soon after Bush’s signing ceremony, the telecoms filed papers in the federal court where the lawsuits against them were proceeding and—citing the immunity they had just received—demanded the summary dismissal of those suits. The judges, their hands bound by the new law, threw those cases out of court, and the telecoms were forever shielded from paying any compensation to the customers whose privacy they had sacrificed. They were also shielded from any criminal investigations or prosecutions for those crimes.
The Washington establishment and the telecom industry exulted over their great victory, and understandably so. It signaled that there is literally no limit on the ability of corporate elites, using their control of government, to be immunized from the rule of law, potently foreshadowing Wall Street’s full-scale protection after the 2008 financial crisis.
The telecom industry issued fulsome expressions of gratitude. As it happened, the new FISA bill was passed shortly before the Democratic National Convention was to meet in Denver and formally announce Barack Obama as the party’s presidential nominee. Within two weeks after the bill’s passage, the steering committee of the DNC unveiled AT&T’s generous sponsorship of various aspects of the convention, including products such as an AT&T-branded tote bag to be distributed to all convention delegates.
At the convention itself, AT&T’s signature globe was prominently placed at virtually every DNC event. While this sponsorship was relatively trivial from a financial perspective, few things were more appropriate than having a telecom logo hover over the Democratic Party’s principal gathering. After all, the party had just delivered an extraordinary gift to that industry. The omnipresence of AT&T was a refreshingly, if not intentionally, honest expression of the Democrats’ true allegiance.
The second day of the Democratic convention fell on August 25, 2008. That night, at the Mile High Station—next to Invesco Stadium, where Barack Obama was to accept the party’s nomination in front of a crowd of eighty thousand people two nights later—AT&T threw a lavish private party for Blue Dog House Democrats. This was one of the listings for the event:
8 P.M.
Just because the Blue Dogs are fiscally conservative doesn’t mean they can’t have a good time, especially when AT&T is picking up the bill. Mile High Station, 2027 W. Lower Colfax Ave. By invitation.
Armed with full-scale convention press credentials issued by the DNC (though lacking an invitation to the party), I went with several other people to report on the festivities. Deployed around the building was a wall of private security guards, who informed us that the press was barred from the gathering—even though what was taking place inside was a meeting between one of the nation’s largest corporations and the numerous members of one of the most influential elected factions in Congress.
Denied access to the building, we stood in front of the entrance and began videotaping and trying to interview the parade of Blue Dog representatives, AT&T executives, assorted lobbyists, and convention delegates pulling up in their rented limousines, chauffeured cars, and SUVs. We wanted to find out who was attending and why AT&T would be throwing such a lavish party for the Blue Dog members of Congress.
Amazingly, not a single one of the twenty-five to thirty people we tried to interview would speak to us about who they were, how they got invited, what the party’s purpose was, or why they were there. One attendee said that he was with an “energy company,” and another confessed that she was affiliated with a “trade association,” but this was the full extent of anyone’s willingness to describe themselves or this event. After just a few minutes, the private security teams demanded that we leave. When we refused and continued trying to interview the reticent attendees, the Denver police forced us to move farther and farther away from the entrance until finally we were unable to approach any more of the arriving guests.
It was really the perfect symbol for how the Beltway political system functions: those who dictate the nation’s laws (the largest corporations and their lobbyists) cavorting with those who are elected to write those laws (members of Congress) while completely prohibiting the public from having any access to and knowledge of—let alone involvement in—what they are doing. All of this was arranged by AT&T, the corporation that paid for part of the Democrats’ national convention after having just received an extraordinary gift of retroactive amnesty from the Congress controlled by that party. And all of it took place right next to the stadium where the Democratic presidential nominee—who had spent months righteously claiming that, if elected, he would cleanse the Beltway of corporate and lobbying influences—was to accept the presidential nomination.
The telecom immunity law was one of the most striking pieces of evidence demonstrating that the royal Beltway court and its corporate partners placed themselves above and beyond the reach of the law even for the most blatant transgressions. But more important, it also proved that they no longer cared who knew it. And the vital enabling role that the Democratic Party and Barack Obama played in those events was a powerful foreshadowing of how—once they consolidated their hold on political power—the Democrats would not just maintain, but entrench and expand, this culture of elite impunity.
3
Too Big to Jail
In July 2010, Martin Joel Erzinger, a hedge fund manager for extremely wealthy investors at Morgan Stanley Smith Barney, was driving his car near Vail, Colorado, when he hit a bicyclist from behind and then sped away. The Vail Daily reported that the victim, Steven Milo, suffered “spinal cord injuries, bleeding from his brain and damage to his knee and scapula,” which left him facing multiple surgeries. The newspaper’s account of the incident makes clear that Erzinger should have been prosecuted for this incident.
Milo was bicycling eastbound on Highway 6 just east of Miller Ranch Road, when Erzinger allegedly hit him with the black 2010 Mercedes Benz sedan he was driving. Erzinger fled the scene and was arrested later, police say.
Erzinger allegedly veered onto the side of the road and hit Milo from behind. Milo was thrown to the pavement, while Erzinger struck a culvert and kept driving, according to court documents.
Erzinger drove all the way through Avon, the town’s roundabouts, under I-70 and stopped in the Pizza Hut parking lot where he called the Mercedes auto assistance service to report damage to his vehicle, and asked that his car be towed, records show. He did not ask for law enforcement assistance, according to court records.
Committing a hit-and-run is a felony in Colorado, and leaving the scene of a crime constitutes a felony as well. Nevertheless, the district attorney, Mark Hurlbert, announced that Erzinger would be charged only with a misdemeanor, which carries no jail time. Hurlbert’s explanation for not charging Erzinger with any felonies was blunt: “Felony convictions have some pretty serious job implications for someone in Mr. Erzinger’s profession.”
In other words, Erzinger engages in such vital activity that charging him with a felony would be wrong because it might seriously disrupt his work: managing the money of multimillionaires and billionaires. According to Worth magazine, Erzinger “oversees over $1 billion in assets for ultra high net worth individuals, their families and foundations.” If he were charged with a felony, he would be required to report that fact to licensing agencies; a felony conviction could result in his fund manager license being rescinded. Apparently, as far as the district attorney was concerned, it would be terribly unfair to subject someone like Erzinger to the risk of damaging his career, though presumably someone with less to lose could—and would—be charged as a felon without any such worries.
Hurlbert added that Erzinger’s willingness to pay restitution to his victim also militated against prosecuting him: “The money has never been a priority for [the victim]. It is for us. Justice in this case includes restitution and the ability to pay it.” As Felix Salmon of Reuters put it, the Erzinger case was thus a classic demonstration of how to “buy your way out of a felony charge.” But it was also more than that. Hurlbert’s decision was grounded in what has become a well-entrenched principle: certain individuals are simply too important to be subjected to criminal prosecution.
Once the Erzinger case was publicized by the talk radio host David Sirota and by Colorado newspapers, there was a public uproar. More than ten thousand local residents signed petitions demanding the filing of felony charges, to no avail. And although the incident eventually attracted significant attention, Hurlbert’s logic is notable precisely because it is so common. Indeed, the same type of immunity from legal consequences is continuously granted to the financially powerful on a much larger and more consequential scale.
The shielding of the Colorado hedge fund manager illustrates how reflexively exemption from the rule of law is now bestowed on the nation’s wealthiest, and it highlights the means used to accomplish that. Even the massive recklessness and fraud that in 2008 spawned one of the worst financial crises in modern history has produced very little legal accountability—and almost no criminal liability—for the perpetrators so far, and is quite unlikely to do so in the future. Nor have the 2010 revelations of systematic industry-wide fraud by mortgage-holding banks prompted anything besides efforts by the political class to protect that plundering industry. And to justify this lack of accountability for the nation’s wealthiest lawbreakers, the all-too-familiar excuses long used to shield the politically powerful are trotted out on cue. Once again, we are told that prosecutions are too disruptive; that it’s more important to fix the system than to seek retribution for the past; that because the wrongdoers’ reputation is in tatters, they have already suffered enough; that we need the goodwill of financial titans to ensure our common prosperity; and so on. (Glen Greenwald "With Liberty And Justice For Some" p.96-103)
On the contrary, those who have brought the world economy to its knees are the ones who have prospered—the only ones who have prospered. “A lot of people who are responsible (for the crisis) seem to have gotten awfully rich,” Barbara Roper, the director of investor protection for the Consumer Federation of America, told a McClatchy reporter on the one-year anniversary of the crisis. It’s not hard to see why that happened. The political responses to this crisis have been shaped by the very financial elites whose recklessness caused the crisis in the first place, and thus it is those very elites who have been the prime beneficiaries.
In August 2009, Simon Johnson, the former chief economist at the International Monetary Fund and current economics professor at MIT, wrote a widely hailed article in the Atlantic titled “The Quiet Coup.” He documented the similarities between the U.S. response to the financial crisis and the response of “emerging markets” countries to similar upheavals of the past. Arguing that a “financial oligarchy” exerts nearly full control over America’s political institutions, Johnson pointed to parallels with the elites that caused previous financial meltdowns in places such as Ukraine, Russia, Thailand, Indonesia, and South Korea. In all those cases, the same financial elites whose recklessness and illegality brought on the economic crisis used their power over political institutions to ensure that they were the prime beneficiaries of the governments’ response. Johnson writes:
At the outset of the crisis, the oligarchs are usually among the first to get extra help from the government, such as preferential access to foreign currency, or maybe a nice tax break, or—here’s a classic Kremlin bailout technique—the assumption of private debt obligations by the government. Under duress, generosity toward old friends takes many innovative forms. Meanwhile, needing to squeeze someone, most emerging-market governments look first to ordinary working folk—at least until the riots grow too large….
In its depth and suddenness, the U.S. economic and financial crisis is shockingly reminiscent of moments we have recently seen in emerging markets (and only in emerging markets): South Korea (1997), Malaysia (1998), Russia and Argentina (time and again)….
But there’s a deeper and more disturbing similarity: elite business interests—financiers, in the case of the U.S.—played a central role in creating the crisis, making ever-larger gambles, with the implicit backing of the government, until the inevitable collapse. More alarming, they are now using their influence to prevent precisely the sorts of reforms that are needed, and fast, to pull the economy out of its nosedive. The government seems helpless, or unwilling, to act against them.
This unwillingness is easily explained. Our government institutions are so dominated by financial elites that the very idea that the former would hold the latter accountable under the law is ludicrous. Indeed, it is impossible—as impossible as, say, an employee firing his boss, a tenant evicting a building owner, or inmates punishing the warden. America’s financial elites have not only stockpiled vast amounts of material wealth but also acquired control over all the government and legal institutions that might stand in the way of their corruption and stealing.
To say such things about America, particularly in such stark terms, was once deemed radical and unserious; it was self-marginalizing. But no longer. The ability of financial elites to avoid any legal consequences even for the most egregious acts of wrongdoing is now so self-evident that it has been acknowledged even in the most establishment-sympathetic venues.
In April 2009, the second-highest-ranking Democrat in the United States Senate, Dick Durbin of Illinois, blurted out on a local Chicago radio station: “The banks—hard to believe in a time when we’re facing a banking crisis that many of the banks created—are still the most powerful lobby on Capitol Hill. And they frankly own the place.” Paul Blumenthal of the transparency group Sunlight Foundation emphasized the eye-popping dollar amounts behind Durbin’s comment. (Glen Greenwald "With Liberty And Justice For Some" p.1)
The same week, the New York Times described one of the crucial secret meetings that shaped the federal government’s response to the financial crisis. Presiding over that gathering at the Federal Reserve Bank of New York was Bush treasury secretary—and former Goldman CEO—Hank Paulson. The primary topic of discussion was the imminent collapse of American International Group, the giant insurance corporation. AIG’s principal government regulator was absent from the meeting, but in attendance were a small number of Wall Street executives, including Lloyd Blankfein, Paulson’s successor as the CEO of Goldman Sachs. The AIG matter was of urgent concern to Blankfein because, as the Times put it, “a collapse of [AIG] threatened to leave a hole of as much as $20 billion in Goldman’s side.” The outcome of the meeting, of course, could not have been better for Goldman: “Days later, federal officials, who…initially balked at tossing a lifeline to A.I.G., ended up bailing out the insurer for $85 billion.”
Ordinarily, when a severely distressed company such as AIG is being saved by an infusion of capital, the party providing that money has significant leverage to negotiate with the failing company’s creditors. The rescuing entity can easily force those creditors to accept deep discounts on the failing company’s debt as a condition of the rescue. The reason for this is obvious. The party saving the distressed company simply tells the creditors: if you refuse to settle for a partial repayment of the money you loaned, then we will not rescue the company, it will collapse, and you might collect nothing at all. The U.S. government, when bailing out AIG, was thus in the perfect position to force those companies to which AIG owed the most money—including Goldman—to agree to substantial discounts and thereby make the bailout significantly cheaper. That was particularly true since many of those same creditors (again including Goldman) were themselves vying to receive multibillion-dollar bailouts, providing added leverage for government negotiators.
But in the case of AIG and Goldman, none of that happened. Not only was the insurance firm bailed out by the federal government, but—with the U.S. government essentially in control—it ended up paying off its debts at a rate of 100 percent; not a single penny of discount was negotiated. That meant that Goldman received the full amount due from AIG, in addition to the sums received directly from the government as part of its own bailout. That decision stood in rather stark contrast to the U.S. government’s dealings with the United Auto Workers in February 2009. There, the government insisted that it would only bail out the auto industry if the union agreed to massive reductions in contractually stipulated benefits.
A month after the UAW negotiations, a major controversy erupted when it was revealed that AIG executives—including many who had presided over the very transactions that had led to that firm’s near demise, a demise averted only with a major infusion of taxpayer money—were to receive millions of dollars in bonuses. The Obama administration insisted that it was powerless to stop those bonuses. When asked by George Stephanopoulos of ABC News to defend that claim, Larry Summers, one of Obama’s top economic advisers, righteously invoked noble legal principles: “We are a country of law. There are contracts. The government cannot just abrogate contracts.”
Stephanopoulos notably failed to ask why that same government could force the working-class, nonculpable, politically powerless autoworkers to accept major reductions in their contractual benefits as a condition for a bailout but could not do the same for the highly culpable, extremely wealthy AIG executives. Apparently, the sanctity of contract rights shields the entitlements of financial elites but is no barrier to forcing ordinary Americans to give up vested rights upon pain of losing their jobs. (Glen Greenwald "With Liberty And Justice For Some" p.112-3)
This “no-accountability” approach is of course just a slightly altered variant of the mentality that led to the pardon of Nixon and the subsequent granting of immunity to powerful political criminals. Likewise familiar is the rationale now routinely invoked to justify the lack of prosecutions of financial elites: given their importance, it is vital that we not disrupt their efforts and actions by bothering them with investigations for their crimes. As Hirsh wrote about the prospects of prosecuting the credit agencies: “The government is simply too afraid to let that happen. Like many of the big banks, the ratings agencies have been deemed too big or important to the system to fail.”
In her book ECONned, Yves Smith—who spent much of her career on Wall Street, including a stint at Goldman—extensively details the fraudulent accounting practices that preceded the downfall of Lehman Brothers and other banks. As she notes, “What went on at Lehman and AIG, as well as the chicanery in the CDO [collateralized debt obligation] business, by any sensible standard is criminal.” Smith points out in particular the proliferation of the kind of pay-for-play that was exposed in the JPMorgan/Jefferson County case discussed earlier in this chapter.
Municipal finance has long been a cesspool, but blatantly corrupt behavior was, not that long ago, for the most part limited to backwaters and bucket-shop operators. Now, it isn’t just Jefferson County, but pretty much every big-name financial firm is involved in multiple cases of stuffing local governments and their pension funds, with derivatives that had all sorts of tricks and traps or toxic CDOs, sometimes with the liberal applications of bribes, sometimes merely with fast talk and omission of key details. Often, these government entities hired “experts” who simply sold them out for fat fees.
Perhaps the most notable argument for clear-cut lawbreaking as the cause of the financial crisis came from a very unlikely source: the longtime Federal Reserve chairman Alan Greenspan, who spent much of his career demanding fewer and fewer regulatory restraints on Wall Street. In the wake of the economic collapse, Greenspan admitted that he had been wrong to oppose increased regulations, telling a House committee, “Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief,” and acknowledging that the crisis had exposed a “flaw” in his free-market ideology. But, after spending decades insisting that fraud was not a real problem on Wall Street, Greenspan also argued that much of the problem was due not to lax regulations but to outright criminality.
Well, first of all, remember you have to distinguish between supervision and enforcement. A lot of the problems which we had in the independent issuers of subprime and other such mortgages, the basic problem there is that, if you don’t have enforcement, and a lot of that stuff was just plain fraud, you’re not coming to grips with the issue.
When even a longtime Wall Street servant such as Alan Greenspan admits that a substantial cause of the financial crisis was “just plain fraud,” the almost complete absence of criminal consequences is clearly an extraordinary injustice.
In December 2010, ProPublic reporter Jesse Eisinger—who covered the financial crisis from the start—protested the lack of prosecutions in the New York Times, noting that even on Wall Street, “everyone is wondering: Where are the investigations related to the financial crisis?” Eisinger’s article summarized the shocking state of affairs:
Nobody from Lehman, Merrill Lynch or Citigroup has been charged criminally with anything. No top executives at Bear Stearns have been indicted. All former American International Group executives are running free. No big mortgage company executive has had to face the law…. The world was almost brought low by the American banking system, and we are supposed to think that no one did anything wrong?…As a society, we have the bankers we deserve. Sadly, it’s looking as if we have the regulators and prosecutors we deserve, too.
A blue-ribbon report did get issued in January 2011 by the government’s Financial Crisis Inquiry Commission. It was a typical Beltway piece of obfuscation and whitewashing, a work with little real insight and even less consequence. Although the commission found that the crisis could have been averted with greater government regulation and was largely caused by industry-wide fraud, it identified no specific culprits and failed to call for any criminal investigations. Like most panels of its kind, the FCIC did not threaten the perpetrators with any real consequences, despite some harsh language blaming the financial industry as a whole. The report’s release was, in the words of Joe Nocera of the New York Times, “almost comical” and failed in its only real mission: to “propose a satisfying theory that explains why so many people did so many wrong, and wrong-headed, things in the years leading up to the financial crisis.” As a result, it did absolutely nothing to bring any real accountability to either the financial elites responsible for the crisis or the government regulators who had allowed it to happen.
What’s perhaps even more astounding than the lack of criminal prosecutions is that, years later, the original practices behind the crisis have hardly been constrained at all. In January 2010, the Treasury Department’s independent watchdog over the Wall Street bailout, Neil Barofsky, issued a scathing report documenting that many of the factors behind the financial crisis are still with us, and that in some respects the situation has actually worsened. “It is hard to see how any of the fundamental problems in the system have been addressed to date,” Barofsky wrote. Banks that were said to be “too big to fail” are now “even larger,” and Wall Street is “more convinced than ever” that it will be saved from failure by the government, thus increasing the motivation to take enormous risks. Wall Street bonuses in the year immediately after the crisis reveal “little fundamental change” in troublesome compensation schemes, while federal efforts to support the housing market “risk reinflating that bubble.” Moreover, the so-called financial regulation legislation enacted by Congress in the summer of 2010 was so diluted by lobbyists and donors from the very industry it purported to regulate that the primary causes of the crisis—including the “too-big-to-fail” quandary and unregulated derivatives markets—went almost entirely unaddressed.
Indeed, the government’s ties to Wall Street are stronger than ever. In September 2010, the Huffington Post reviewed Geithner’s calendars as treasury secretary—just as the New York Times had done for his calendars as New York Fed chair—and found the same pattern: Geithner still spends most of his time speaking with the very banking executives whom he’s supposedly regulating.
The findings included the fact that “Geithner has met more often with Goldman Sachs CEO Lloyd Blankfein than Congressional leaders.” Indeed, the Huffington Post noted, “Goldman CEO Lloyd Blankfein has shown up on Geithner’s calendar at least 38 times through March 2010 since the Treasury Secretary took office in January 2009, three more entries than Senate Majority Leader Harry Reid, 13 more than House Speaker Nancy Pelosi, and nearly four times as many as Senate Minority Leader Mitch McConnell and House Minority Leader John Boehner combined.” What’s more, during his first five months in office, “Geithner met with chief executives from firms like Citigroup, JPMorgan Chase, Morgan Stanley and BlackRock at least 76 times—more calendar entries than for the heads of the regional Federal Reserve banks, who are the top overseers of systemically-important banks like JPMorgan, Citi, Bank of America and Wells Fargo—or for top members of Congress like Reid, Pelosi, their Republican counterparts, and the heads of the Senate and House committees overseeing financial institutions and economic policy.”
The political class’s loyalty and subservience to Wall Street grows ever more brazen. In June 2010, Peter Orszag, one of Obama’s key financial officials as the director of Office of Management and Budget, announced he was leaving the administration. After his departure, Orszag spent a few months as a New York Times columnist (advocating for cuts in Social Security as a means of addressing America’s deficit problems), and then, in November 2010, announced he was joining Robert Rubin at Citigroup to become vice chairman of global banking. In other words, after almost two years in an administration that had propped up Wall Street and returned it to tremendous profitability while ordinary Americans continued to suffer extreme economic hardship, Orszag went to collect his rewards from one of the banks that had profited the most from that administration’s policies, and which had received a multibillion-dollar bailout. Orszag’s announcement was branded by the longtime Atlantic editor James Fallows as “damaging and shocking.”
His move illustrates something that is just wrong. The idea that someone would help plan, advocate, and carry out an economic policy that played such a crucial role in the survival of a financial institution—and then, less than two years after his Administration took office, would take a job that (a) exemplifies the growing disparities the Administration says it’s trying to correct and (b) unavoidably will call on knowledge and contacts Orszag developed while in recent public service—this says something bad about what is taken for granted in American public life.
When we notice similar patterns in other countries—for instance, how many offspring and in-laws of senior Chinese Communist officials have become very, very rich—we are quick to draw conclusions about structural injustices. Americans may not “notice” Orszag-like migrations, in the sense of devoting big news coverage to them. But these stories pile up in the background to create a broad American sense that politics is rigged, and opportunity too.
Not even a cataclysmic Wall Street–caused crisis that imposed great suffering on millions of Americans could slow down the wholesale capture of the government by the nation’s wealthiest corporations. The obliteration of the wall separating the private and public spheres continues unabated, and financial elites are now more confident than ever that things such as laws and oversight exist for them in name only.
Dusting off the Telecom Immunity Playbook
Few events better illustrate the ever-expanding lawbreaking license granted to elites than the mortgage fraud crisis of 2010. Beginning in the fall of that year, incontrovertible evidence emerged showing that the nation’s largest mortgage banks were operating a system built on deceit, illegality, and fictitious legal documents, all in the service of foreclosing on the homes of millions of Americans rapidly and without resistance. The fraud here was perpetrated on both the homeowners whose property was illegally seized, and on the courts to which forged documents were routinely submitted. Yet the first instinct of the political class in the face of this sweeping criminality was to find ways to protect the mortgage industry from accountability. (Glen Greenwald "With Liberty And Justice For Some" 2011 p.132-7)
Despite the magnitude of the fraud—or, more accurately, because of it—the political class quickly reacted not by attempting to impose accountability on these banks, but rather by rushing to protect them from accountability. Trumpeting the same excuse now used reflexively by the political class to justify elite immunity—it’s more important to fix the problems in the future than to seek retribution—the Obama administration immediately announced that it had no intention of punishing any past transgressions, even ones involving unambiguous lawbreaking. In a stunning display, administration officials affirmed the importance of legal accountability in one breath but then proclaimed in the next that their focus would nonetheless be elsewhere. On October 20, the Huffington Post reported:
U.S. Housing and Urban Development Secretary Shaun Donovan said Wednesday that the Obama administration…had yet to find anything fundamentally flawed in how large banks securitized home loans or how they foreclosed on them.
“Where any homeowner has been defrauded or denied the basic protections or rights they have under law, we will take actions to make sure the banks make them whole, and their rights will be protected and defended,” Donovan said at a Washington press briefing. “First and foremost, we are committed to accountability, so that everyone in the mortgage process—banks, mortgage servicers and other institutions—is following the law. If they have not followed the law, it’s our responsibility to make sure they’re held accountable.”
He added, however, that the administration is focused on ensuring future compliance, rather than on looking back to make sure homeowners and investors weren’t harmed during the reckless boom years. The administration is “committed to forcing institutions to change the way that they conduct business,” Obama’s top housing official said, “to make sure these problems don’t happen again.”
Even the administration’s claim that it had “yet to find anything fundamentally flawed” in the mortgage process was the by-product of a deliberate see-no-evil scheme of protection. Commentators, experts, and state officials had already assembled vast and growing amounts of evidence suggesting that the fraud was systematic and reckless, sometimes even deliberate. But by waiting for iron-clad proof before concluding that serious wrongdoing took place, the administration skewed the inquiry in advance to protect the banks from the rule of law.
The career Wall Street financial services expert Yves Smith, writing on her blog, gloomily reflected on the administration’s efforts.
The effect of the official “don’t rattle the markets” posture is a refusal to dig too deeply, and the end result is to sanction fraud. Rewarding criminal behavior has never been the foundation of a well functioning capitalist society; indeed, Singapore was able to become an economic success against considerable odds by having a clean government and tough enforcement. But the powers that be seem determined to try this experiment, since they’d rather not rattle the power structure, no matter how rotten it might turn out to be.
But even more remarkable than the Obama administration’s steadfast refusal to subject these banks to criminal proceedings is the fact that a mere month or so into the scandal, government officials began openly plotting how to vest the mortgage banks with retroactive immunity and thereby shield the industry from all liability, criminal and civil alike.
In November 2010, John Carney of CNBC reported that the lame-duck Congress “may consider measures intended to bolster the legal status of a controversial bank owned electronic mortgage registration system that contains three out of every five mortgages in the country.” That system, known as MERS (Mortgage Electronic Registration Systems), administers mortgages on behalf of the largest banks. It was through MERS that the fraudulent foreclosure network at the heart of the scandal had been created. In the wake of reports that liability for MERS-related reckless foreclosure actions could run into the billions of dollars, Congress began planning—just as it did with telecoms two years earlier—to retroactively legitimize the fraudulent mortgages and immunize the industry. As Carney wrote: (Glen Greenwald "With Liberty And Justice For Some" 2011 p.140-1)
One paper at the Capital received, through his efforts, a legislative appropriation of $207,900 for one year’s printing, whereas $10,000 would have overpaid it for the service rendered. The proprietor of an Albany journal which was for many years the Republican organ of the State, made it a practice to submit to Tweed’s personal censorship the most violently abusive articles. On the payment of large sums, sometimes as much as $5,000, Tweed was permitted to make such alterations as he chose.
Unfortunately for Tweed, however, some publications were unwilling to look the other way. Beginning in the late 1860s, the New York Times, then a Republican newspaper, began publishing a stream of exposés and editorials highlighting the corruption of Tammany Hall. They were joined by the political cartoonist Thomas Nast, whose popular caricatures in Harper’s Weekly lampooned Tweed as a bloated symbol of greed and corruption. Tweed was reportedly so frightened that Nast could turn public opinion against him that he offered the cartoonist a few hundred thousand dollars to cease his attacks, only to be rebuffed.
Responding to evidence of rampant corruption, the Democratic state assemblyman and committed reformer Samuel Tilden bucked the interests of his fellow party members and pursued the prosecution of Tweed, the impeachment of corrupt judges, and the eventual breakup of his own party’s machinery. Such bold action seems unthinkable today, yet Tilden’s attempts to enforce the rule of law did not render him a pariah doomed to spend the rest of his career advocating from the fringe. Indeed, the outcome was quite the opposite: he became a folk hero. Tilden prevailed in having Tweed and his cronies tried and convicted, rode a wave of popular support into the governorship in 1874, and eventually won the presidential election of 1876 (only to have the presidency stolen from him by Rutherford B. Hayes).
Tweed, on the other hand, was destroyed. As recounted in Albert Bigelow Paine’s 1904 biography Thomas Nast: His Period and His Pictures, at one point Tweed escaped custody and fled to Spain, only to be recognized due to his resemblance to the cartoon depictions of him in Harper’s Weekly and extradited back to America. Redefining poetic justice, Tweed was literally done in by a cartoon and eventually died in prison—powerless, broke, and disgraced.
Besides wielding tremendous political power, Boss Tweed was an immensely wealthy man: one of the largest landowners in New York City, with vast holdings in a wide variety of enterprises. But he was brought down thanks to the efforts of a Republican newspaper, a political cartoonist, and a determined reformer willing to confront the misdeeds of his own political party. One cannot even imagine a modern equivalent of this coalition.
A few decades later, an aggressive new reformer put on Tilden’s mantle: Theodore Roosevelt. After leaving his post as the secretary of the navy to command the “Rough Riders” cavalry regiment during the Spanish-American War, Roosevelt decided to try his hand at electoral politics. He won the governorship of New York in 1898 as a Republican and proceeded to root out corruption in his own party. Roosevelt hated injustice with a passion unrivaled by any of his contemporaries, and he was such a thorn in the side of the New York machine that in 1900, the Republican political boss Thomas Collier Platt maneuvered to place him on the incumbent president William McKinley’s ticket as vice president just to get him out of the way. (Glen Greenwald "With Liberty And Justice For Some" 2011 p.146-7)
Some have disputed the applicability of the Geneva Conventions to “war on terror” detainees, on the ground that they are not actually prisoners of war. But even if the Geneva Conventions do not apply, there is no such dispute about the Convention Against Torture, a treaty negotiated and signed by President Ronald Reagan, and ratified by the U.S. Senate in 1994. Article 4 of that treaty requires each country to “ensure that all acts of torture are offences under its criminal law,” and Article 5 dictates that “each State Party shall likewise take such measures as may be necessary to establish its jurisdiction over such offences in cases where the alleged offender is present in any territory under its jurisdiction.” Most significantly, Article 7 makes it mandatory for each signatory country to investigate allegations of torture and “submit the case to its competent authorities for the purpose of prosecution.”
The Convention Against Torture explicitly bars considerations of national security or fears of terrorism from being offered as an excuse for perpetrating torture or refusing to prosecute the torturers. Nor is taking orders from one’s commanders considered a valid defense. Article 2 of the treaty states unambiguously:
No exceptional circumstances whatsoever, whether a state of war or a threat of war, internal political instability or any other public emergency, may be invoked as a justification of torture.
An order from a superior officer or a public authority may not be invoked as a justification of torture.
The Convention permits the exercise of some prosecutorial discretion in deciding whether a case should proceed, but specifies that authorities must investigate each case with potential prosecution in mind. There is no doubt, then, that a policy of blanket immunity for torturers—a presidential decree that nobody shall be prosecuted—constitutes a blatant violation of America’s obligations under the Convention. On that critical point the law is clear, and clearly understood. When President Reagan transmitted the treaty to the Senate and urged its ratification, he underscored that its intent was to enforce an absolute legal bar on all acts of torture. The Convention, he said,
marks a significant step in the development during this century of international measures against torture and other inhuman treatment or punishment. Ratification of the Convention by the United States will clearly express United States opposition to torture, an abhorrent practice unfortunately still prevalent in the world today.
The requirements imposed by the treaty are so clear that even Bush himself felt obliged to pay lip service to the law. Speaking in 2004 on the UN Day to Support Torture Victims, he emphasized the country’s legal duty to hold torturers accountable.
The United States has joined 135 other nations in ratifying the Convention Against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment. America stands against and will not tolerate torture. We will investigate and prosecute all acts of torture and undertake to prevent other cruel and unusual punishment in all territory under our jurisdiction. American personnel are required to comply with all U.S. laws, including the United States Constitution, Federal statutes, including statutes prohibiting torture, and our treaty obligations with respect to the treatment of all detainees…. Torture is wrong no matter where it occurs, and the United States will continue to lead the fight to eliminate it everywhere. (Glen Greenwald "With Liberty And Justice For Some" 2011 p.164-5)
(Glen Greenwald "With Liberty And Justice For Some" 2011 additional excerpts
One forty-six-page memo from OLC chief Steven Bradbury, dated May 10, 2005, authorized the following acts to be performed on “high-value detainees”: forced nudity, “dietary manipulation” involving “minimum caloric intake,” “corrective techniques” such as facial and abdominal slapping, water dousing, stress positions designed to “induce muscle fatigue and the attendant discomfort,” and sleep deprivation. Bradbury also approved various degrading acts that might be used against the detainees. He was of the opinion, for example, that a detainee undergoing sleep deprivation could legally be made to wear diapers, “because releasing a detainee from the shackles would present a security problem and would interfere with the effectiveness of the technique.”
An August 1, 2002, memo by then OLC lawyer (and now federal judge) Jay Bybee, meanwhile, describes waterboarding in excruciating detail, matter-of-factly noting that “the subject’s body responds as if the subject were drowning.” Amazingly, while the OLC lawyers admitted that “the use of waterboarding constitutes a threat of imminent death,” they claimed that the procedure was permissible because it does not result in “prolonged mental harm”—an exception found nowhere in the Convention Against Torture. They did tell the White House to perform “no more than two sessions” of waterboarding in “any 24-hour period,” even though, as the legal analyst Marcy Wheeler of Firedoglake pointed out, the same document mentions that “Khalid Sheikh Mohammed was waterboarded 183 times in March 2003 and Abu Zubaydah was waterboarded 83 times in August 2002.”
Similar brutality permeates Bybee’s descriptions of various other techniques to be used against Zubaydah, who was shot three times during his capture and was still suffering from those wounds at the time of his interrogation. These techniques included “walling,” “cramped confinement,” and “insects placed in a confinement box.” “Walling” was slamming someone into a wall. “Cramped confinement” meant, as the memo put it, “placement of the individual in a confined space” that “is usually dark…the dimensions of which restrict the individual’s movements—in other words, a coffin-like space.” And here is how “insects placed in a confinement box” was supposed to play out.
You would like to place Zubaydah in a cramped confinement box with an insect. You have informed us that he appears to have a fear of insects. In particular, you would like to tell Zubaydah that you intend to place a stinging insect into the box with him. You would, however, place a harmless insect in the box.
Notably, these memos explicitly recognized that the United States had long considered the very techniques these lawyers were approving to be criminal and to constitute torture—when committed by other nations. As the Bradbury memo explained:
Each year, in the State Department’s Country Reports on Human Rights Practices, the United States condemns coercive interrogation techniques and other practices employed by other countries. Certain of the techniques the United States has condemned bear some resemblance to some of the CIA interrogation techniques. In their discussion of Indonesia, for example, the reports list as “[p]sychological torture” conduct that involves “food and sleep deprivation,” but give no specific information as to what these techniques involve. In their discussion of Egypt, the reports list as “methods of torture” “stripping and blindfolding victims; suspending victims from a ceiling or doorframe with feet just touching the floor; beating victims [with various objects];…and dousing victims with cold water.”
See also, e.g. Algeria (describing the “chiffon” method, which involves “placing a rag drenched in dirty water in someone’s mouth”); Iran (counting sleep deprivation as either torture or severe prisoner abuse); Syria (discussing sleep deprivation and “having cold water thrown on” detainees as either torture or “ill-treatment”). The State Department’s inclusion of nudity, water dousing, sleep deprivation, and food deprivation among the conduct it condemns is significant and provides some indication of an executive foreign relations tradition condemning the use of these techniques. (Glen Greenwald "With Liberty And Justice For Some" 2011 p.170-1)
To take just one example: On March 25, 2007, MSNBC’s Chris Matthews gathered together four journalists to discuss whether Democrats should attempt to compel the top Bush White House aide Karl Rove to respond to congressional subpoenas. Those subpoenas had been issued as part of an investigation into the firings of eight U.S. attorneys, after evidence had emerged that these prosecutors were terminated either because of their refusal to go after Democratic officials targeted by the White House or because they had dared to probe the potential lawbreaking of GOP officials. In other words, the core allegation of this scandal was that the Bush White House had converted the DOJ into its own political arm and was firing honest prosecutors who refused to advance that agenda. Rove had raised dubious arguments, grounded in sweeping claims of executive privilege, as to why he was not obligated to comply with the subpoenas.
Matthews and his guests—Time managing editor Rick Stengel, MSNBC’s Norah O’Donnell, Gloria Borger of U.S. News & World Report, and Patrick Healy of the New York Times—spent four straight minutes scoffing at the idea that Rove or other White House aides should be investigated to determine whether they had played any role in the firings. The well-documented allegations that powerful executive branch officials were subverting the core mission of the Justice Department could not have been less interesting to the journalists.
Instead, what angered them—the only thing that angered them—was the prospect that Democrats would pursue the investigation. As they so often do, these TV personalities insisted that they were merely speaking for the ordinary American people. Time’s Stengel said: “I am so uninterested in the Democrats wanting Karl Rove, because it is so bad for them. Because it shows business as usual, tit for tat, vengeance. That’s not what voters want to see.” Matthews warned that trying to figure out the truth behind the dismissals would be perceived as “politics” and would backfire on Democrats. O’Donnell agreed, adding, “The Democrats have to be very careful that they look like they’re not the party of investigation rather than legislation in trying to change things.”
In fact, exactly the opposite was true. Immediately before the 2006 midterm election that gave Democrats control of Congress, a CNN poll had asked voters this question: “Do you think it would be good for the country or bad for the country if the Democrats in Congress were able to conduct official investigations into what the Bush administration has done in the past six years?” Fifty-seven percent of the respondents—a distinct majority—believed it would be good if such investigations could be conducted, while only 41 percent believed it would be bad.
Even worse for the journalists’ anti-investigation claims was a substantial set of polling data from USA Today. Released literally days before Matthews and his guests made their confident assertions about the public’s desires, the poll touched on precisely the question they addressed. It revealed overwhelming majorities demanding that the U.S. attorneys investigation be pursued and that Rove be forced to testify.
14. Do you think Congress should—or should not—investigate the involvement of White House officials in this matter?
Yes, should—72%; No, should not—21%
15. If Congress investigates these dismissals, in your view, should President Bush and his aides invoke “executive privilege” to protect the White House decision making process or should they drop the claim of executive privilege and answer all questions being investigated?
Invoke executive privilege—26%; Answer all questions—68%
16. In this matter, do you think Congress should or should not issue subpoenas to force White House officials to testify under oath about this matter?
Yes, should—68%; No, should not—24% (Glen Greenwald "With Liberty And Justice For Some" 2011 p.196-7)
All of that polling data was released at the same time that the Washington Post’s David Ignatius was denouncing those who favored investigations as nothing more than “liberal score-settlers.” Senator Lindsey Graham was featured in Politico stating without contradiction that “only the hard left” favors investigations. Newsweek’s John Barry insisted that there should be no investigations because they were about nothing more than a desire for “vengeance, pure and simple.” On January 22, 2009, the Washington Post reporter Lois Romano was asked about investigations and prosecutions and likewise claimed that the public was against them.
I think right now, President Obama wants to follow the concerns of most Americans—which are the economy and health care. Starting a partisan fight—even if it is legal—would be a major distraction for him and likely not sit well with millions of Americans who are out of work and losing their homes.
It’s remarkable that large pro-investigation majorities were seen in the January and February 2009 polls even though few members of the media or leaders of either party were promoting that viewpoint. As it gradually became clear that not only Republicans but also President Obama and the Democratic leadership opposed any inquiries into Bush-era lawbreaking, the polls did begin shifting against the idea of investigations. That’s not surprising: once both political parties agree on a position, it becomes unchallenged consensus and is rarely even debated or contested again. But before Obama’s anti-investigation posture became clear, large portions of the public clearly had been eager for inquiries into Bush’s policies—exactly the opposite of what so many prominent journalists repeatedly claimed.
Whether majorities favor criminal investigations and prosecutions is, of course, irrelevant to the question whether they should occur. Decisions about equality under the law and accountability for crimes should be driven by legal principles, not majoritarian sentiment. But the polls do expose the fact that establishment journalists are not representing the public but rather competing to see who can most dutifully repeat the administration’s self-justification.
On April 19, 2009, in the wake of the release of the OLC torture memos, Meet the Press convened a panel to discuss what should be done about the crimes those documents reflected. The panel was moderated by David Gregory and included five exceedingly typical Beltway insiders: the Washington Post’s Steven Pearlstein, Fortune’s Nina Easton, Time’s Rick Stengel, former GOP House majority leader Dick Armey, and former conservative Democratic Representative Harold Ford Jr. Exactly as one would expect, they were all in full and complete agreement that there must be no investigations or prosecutions of any kind. Not a syllable was uttered to suggest that political officials should be treated the same as ordinary Americans when they got caught breaking the law. Instead, all the panel members recited the same Washington gospel that is always hauled out to justify elite immunity.
ARMEY: Forget about—why are you talking, smacking George Bush around now? Look for the future.
STENGEL: [Obama] is very Mandela-like in the sense that he’s saying let the past be the past and let us move into the future.
FORD: Look, I think the president said it best…. He said look, the past is the past, let’s move forward.
EASTON: I was just going to say that he clearly wanted to put this behind him, or behind the country, by releasing them.
What a characteristically vibrant, spirited, and diverse media debate that was. The way in which the entire gathering harmoniously repeated the same White House refrain was disturbing indeed. Needless to say, this profound sense of leniency and forgiveness is exclusively reserved for Washington and financial elites. Such sentiments are almost never heard from the media when it comes time to mete out some punishment to ordinary Americans. (The next time you’re pulled over by a police officer for speeding, try quoting Barack Obama and his media defenders: “This is a time for reflection, not retribution.” See if that works. If not, perhaps this will do: “It’s time to focus on the future, not look to the past.” Still no luck?) (Glen Greenwald "With Liberty And Justice For Some" 2011 p.200-1)
American Justice’s Second Tier
When ordinary Americans come in contact with the justice system, everything changes. The world we have been examining reverses. In the United States, the lack of accountability for elites goes hand-in-hand with a lack of mercy for everyone else. As our politicians increasingly claim the right to commit crimes with impunity, they simultaneously escalate the severity of punishments imposed on ordinary Americans who have broken even minor laws.
As a result, precisely what the founders most feared has come to exist: a two-tiered system of justice in which outcomes are determined not by the law itself but by the status, wealth, and power of the lawbreaker. And these days, the people advocating for elite immunity are often the same ones who emphatically insist upon rigid, unyielding enforcement of the rules for the rest of us. Indeed, when it comes to crime and punishment, the trends for powerful and ordinary Americans have been heading in completely divergent directions. During the same four-decade period in which the nation’s political class has expanded legal immunity for political and financial elites, it has imposed ever-harsher prison terms on more and more of the nation’s citizens.
Permissiveness for elites, by itself, is unjust enough. But at least if that leniency were available on an equal basis to everyone, it might arguably be fair, and certainly less injurious to basic precepts of justice. It is the elites’ insistence on treating all others in precisely the opposite fashion from the way they treat themselves that is so pernicious.
The United States now imprisons more of its citizens than any other nation in the world, both per capita and in absolute terms. The numbers are staggering. The United States has only 5 percent of the world’s population, yet nearly 25 percent of all prisoners in the world are on American soil. “Simply put, we have become a nation of jailers,” writes the Brown University professor Glenn Loury. “The American prison system has grown into a leviathan unmatched in human history.”
According to the King’s College International Centre for Prison Studies, at the end of 2008 the United States was incarcerating more than 2.2 million of its citizens in federal and state prisons and local jails around the nation. In July 2010, the Economist similarly put the number at “between 2.3 and 2.4 million.” The nation with the next-largest prison population, China, has 1.6 million people in prison—which means that the United States, a nation of 300 million, imprisons 700,000 more of its citizens than a country whose population is 1.3 billion. And that number is continuing to increase. As a 2007 report from the JFA Institute described it, “If you put them all together in one place, the incarcerated population [of the United States] in just five years will outnumber the residents of Atlanta, Baltimore and Denver combined.”
The United States also has the highest rate of imprisonment of any nation in the world, with 756 people in prison per 100,000 citizens. The next-highest rates belong to Russia (629) and Rwanda (604). The rates in most of the world are far lower. The median imprisonment rate for South American countries is 154; for western Europe, 95; and for western African countries, 35. On a per capita basis, the United States is practically in a league by itself. (Glen Greenwald "With Liberty And Justice For Some" 2011 p.222-3)
The Western World’s Rogue Justice State
There is little question that this decades-long law-and-order movement is a major cause of America’s ever-expanding prison population. Numerous new laws enacted at the federal, state, and local levels have been moving the United States in the direction of longer prison terms, less leniency, and less sentencing discretion available to judges. Nationwide, politicians in both parties have established their tough-on-crime bona fides by supporting—and demanding ever-greater application of—a slew of prison-populating policies, such as “three-strikes-and-you’re-out” laws and abolition of parole.
Beyond laws deliberately intended to incarcerate people for longer periods, prison has become the punishment for an ever-broader array of transgressions, including many that, according to the JFA Institute, “pose little if any danger or harm to our society.” In fact, the United States routinely imprisons its citizens even for nonviolent crimes for which no other Western nation imposes jail terms, from petty drug offenses to writing bad checks. In April 2008, the New York Times reporter Adam Liptak compared the contemporary American approach to criminal justice with that of the rest of the world and found an “enormous and growing” gap: “Americans are locked up for crimes…that would rarely produce prison sentences in other countries.” For Vivien Stern, a research fellow at the prison studies center in London quoted by Liptak, the United States has become “a rogue state, a country that has made a decision not to follow what is a normal Western approach.”
The scope of criminal law has expanded so rapidly, and now includes such minor offenses, that Alex Kozinski, who is the chief judge of the Ninth Circuit Court of Appeals, and the lawyer Misha Tseytlin titled a 2009 essay, with only a little irony, “You’re (Probably) a Federal Criminal.” As they put it, “Most Americans are criminals, and don’t know it, or suspect that they are but believe they’ll never get prosecuted…. Violations are so common that any attempt to go after all criminals would sweep up untold millions of people.”
As Kozinski and Tseytlin note, anyone who has ever misfiled their taxes (even inadvertently), or consumed any illegal drugs (including marijuana), or bet on a sporting event with a bookie, or lied to a government bureaucrat, or even just performed their job poorly (if it’s an occupation regulated by the federal government) has committed a federal offense for which they could be sent to prison—and for which many of their fellow citizens are now actually imprisoned. Similarly, the criminologists Beckett and Sasson report that “in 2000, police arrested more than 2 million individuals for such ‘consensual’ or ‘victimless’ crimes as curfew violations, prostitution, gambling, drug possession, vagrancy, and public drunkenness. Fewer than one in five of all arrests in that year involved people accused of the more serious ‘index’ crimes” such as assault, larceny, rape, or homicide. It should hardly be controversial that a system of criminal law that theoretically renders a substantial portion—if not an outright majority—of the citizenry subject to long prison terms is both excessive and unjust.
It is not merely the proliferation of criminal statutes that has turned America into the world’s largest prison state, but also the severity of punishment. The law professor Michael Tonry, a leading authority on crime policy, writes in his Handbook of Crime and Punishment that American prison sentences are “vastly harsher than in any other country to which the United States would ordinarily be compared.” According to the 2007 JFA report, “For the same crimes, American prisoners receive sentences twice as long as English prisoners, three times as long as Canadian prisoners, four times as long as Dutch prisoners, five to 10 times as long as French prisoners, and five times as long as Swedish prisoners.” Notably, these more severe punishments produce little benefit for the United States. The rates of violent crime in all those countries are lower than America’s, and their rates of property crime are comparable.
One of the most disturbing aspects of the American approach to crime is the embrace of mandatory minimum sentencing schemes, which eliminate mercy and flexibility by denying judges the ability to adjust sentences when circumstances merit. These laws force the courts to subject all convicted defendants to unyielding harshness, even when doing so produces gross injustice. The advocacy group Families Against Mandatory Minimums has documented numerous travesties resulting from these mandatory sentencing rules, such as cases where young adults convicted of petty drug offenses were sentenced to decades in prison. (Glen Greenwald "With Liberty And Justice For Some" 2011 p.234-5)
Moving a little farther south, we find the case of Roy Brown, a fifty-four-year-old African American homeless man who lived on the street in Shreveport, Louisiana. In December 2007, Brown walked into a Capital One bank branch, put his finger inside his jacket, pointed it at a teller, and told her that this was a robbery. She handed him three stacks of bills, but he took only a single one-hundred-dollar bill and gave the rest back to her.
The next day, feeling remorseful, Brown turned himself in to the local police. According to a local Shreveport newspaper, he “told the police he needed the money to stay at the detox center and had no other place to stay and was hungry.” He pled guilty in a Caddo County district court to a single count of first-degree robbery and was sentenced to fifteen years in prison—fifteen years, for the unarmed theft of a single one-hundred-dollar bill.
Some episodes make it particularly clear that such lack of mercy has little to do with notions of deterrence or justice but is simply driven by a desire to punish. In 2005, Genarlow Wilson, a seventeen-year-old African American boy in Atlanta—an honor student and homecoming king—was arrested for having engaged in consensual oral sex (but not intercourse) with a girl two years younger than he. Under Georgia law, a fifteen-year-old is underage, and neither her consent nor the minimal age difference between the perpetrator and victim could be taken into account. Wilson repeatedly refused to plead guilty and accept a five-year prison term. When the case went to trial, he was convicted of aggravated child molestation—“aggravated” because oral sex was involved, not because of any coercion—and sentenced to ten years in prison. As a convicted sex offender, he was ineligible for parole. Moreover, the sex offender status carried with it lifelong penalties, including registry requirements and a ban on contact with his younger sister.
Wilson insisted that he had done nothing wrong and vowed to appeal his conviction and sentence. Twice, the Georgia Supreme Court refused to hear his appeal, leaving him in prison. In 2007, after Wilson’s sentencing, the Georgia state legislature changed the state’s molestation law so that any minor convicted of molestation would be guilty only of a misdemeanor and subject to just a one-year sentence. But with Wilson in mind, the legislature explicitly included a provision stating that the change would not be retroactive. (Glen Greenwald "With Liberty And Justice For Some" 2011 p.238-40)
Prisons for Profit
When it comes to the way money shapes American justice, nothing competes with the impact of the privatized prison lobby. Imprisoning criminals, once exclusively a government responsibility, has—like most government functions—been increasingly privatized. All over the United States, more and more prisons are managed not by government agencies but by for-profit private corporations such as Geo Group and Corrections Corporation of America. (In 2008, private prisons housed 7.5 percent of all inmates nationwide.) Those same companies accrue substantial revenues by providing contracting services to government-run prisons. They quite naturally view prisoners as their basic stock in trade and earn a profit for each one they incarcerate.
Like all private companies, the prison industry has an insatiable appetite for more business, and thus it agitates in favor of greater demand for its services—demand created through longer prison sentences, fewer opportunities for parole, and constant increases in the number of transgressions deemed prison-worthy. In other words, the private prison industry profits from precisely the draconian approach to penal policies implemented over the past several decades. This perverse dynamic was perfectly captured by the headline for a November 2008 Wall Street Journal article: “Larger Inmate Population Is Boon to Private Prisons.” And the article itself made it clear that the prison companies don’t expect the tide to turn anytime soon.
Corrections Corp., the largest private-prison operator in the U.S., with 64 facilities, has built two prisons this year and expanded nine facilities, and it plans to finish two more in 2009. The Nashville, Tenn., company put 1,680 new prison beds into service in its third quarter, helping boost net income 14% to $37.9 million. “There is going to be a larger opportunity for us in the future,” said Damon Hininger, Corrections Corp.’s president and chief operations officer, in a recent interview…. Geo Group, of Boca Raton, Fla., the second-largest prison company, has built or expanded eight facilities this year in Georgia, Texas, Mississippi and other states, and it plans seven more expansions or new prisons by 2010.
Simply put, incarceration is now big business in the United States. According to the Pew, “Total national spending on corrections has jumped to more than $60 billion from just $9 billion in 1980, even as recidivism rates have barely changed.” Indeed, “prisons are the fourth-largest state budget item behind health, education and transportation.” Government at every level continues to spend more on incarceration and other phases of the correction process with every passing year. The DOJ’s own statistics are striking (see chart below).
Private prison corporations are receiving an increasing share of this spending, and the industry appears to be recession-proof. In early 2009, as most of the nation suffered from the financial crisis, CorpWatch noted that Geo Group “reported impressive quarterly earnings of $20 million…along with an annual income of $61 million for 2008—up from $38 million the year before.”
Like all profitable industries—especially those that rely on the government for business—private prison corporations dedicate substantial amounts of money to shaping laws that will maximize their revenue. Indeed, the increasing role played by these private corporations in performing what had traditionally been a government function is another manifestation of the public/private merger: the for-profit prison companies have, in essence, established themselves as part of the government, and laws are written by them and for their benefit. In the case of the prison industry, that’s particularly perverse, as their interest is best served by ever-harsher punishment schemes for ordinary Americans. A 2004 report from the National Institute on Money in State Politics revealed that for the 2002 and 2004 election cycles, these companies and their directors, executives, and lobbyists donated $3.3 million to candidates and state political parties across forty-four states.
In a comprehensive article in In These Times documenting the success of the private prison industry in shaping America’s penal laws, Silja J. A. Talvi noted that “private prison companies strongly favor giving to states with the toughest sentencing laws—in essence, the ones that are more likely to come up with the bodies to fill prison beds.” And, of course, one finds countless instances of “revolving door” transfers, in which public criminal justice officials move seamlessly to the private prison industry while that industry in turn sends hordes of its executives into the very government positions that dole out prison contracts and implement penal policies.
A particularly repellent consequence of the public/private prison industry merger was exposed in a December 2008 investigative report from the Boston Phoenix, which showed that the prison companies have been expending vast resources to combat drug policy reform. The corporations fear an end to their greatest source of income: the incarceration of hundreds of thousands of citizens for nonviolent drug offenses. Such reform strikes at the heart of the industry’s capacity for future growth, and private prison operators have thus made it a priority not only to preserve current punishment schemes but to advocate for even harsher ones. Accordingly, the Phoenix revealed, the industry “regularly lobb[ies] against criminal-punishment reforms, and for the creation of new criminal statutes and overly harsh prison sentences. While these efforts are cloaked as calls for public safety, they are essentially creating more business for themselves.”
The report noted that significant sums of money were at stake.
The country’s largest private prison provider, the Corrections Corporation of America (CCA), spent more than $2.7 million from 2006 through September 2008 on lobbying for stricter laws. Last year alone, the company, listed on the New York Stock Exchange, generated $133 million in net income.
Since there is no well-funded lobby advocating for penal reform or promoting the interests of prisoners, the prison lobby goes virtually unchallenged and can buy the ability to shape pertinent laws at bargain basement prices.
Even worse than the corruption is the perverse incentive that these for-profit corporations have to operate increasingly inhumane facilities. By forcing prisoners into severely overcrowded quarters and depriving them of the supervision necessary to prevent rape and other forms of abuse, corporations can reduce costs and thus increase their profits. As Senator Webb put it, the levels of violence and sexual victimization in this country’s prisons are completely “off the charts.”
The American justice system has become a weapon to control, exploit, and profit off vast numbers of American citizens. That the victims of this exploitation are disproportionately the poor and the powerless makes it all the more repugnant. (Glen Greenwald "With Liberty And Justice For Some" 2011 p.254-7)
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