In Book's Trial Of U.S. Justice System, Wealth Gap Is Exhibit A

In Book's Trial Of U.S. Justice System, Wealth Gap Is Exhibit A

6:56pm Apr 06, 2014
detail from cover of the divide
Courtesy of Random House
  • detail from cover of the divide

    Courtesy of Random House

  • Matt Taibbi is also the author of Griftopia, The Great Derangement, Smells Like Dead Elephants and Spanking the Donkey.

    Matt Taibbi is also the author of Griftopia, The Great Derangement, Smells Like Dead Elephants and Spanking the Donkey.

    Courtesy of Random House

Investigative journalist and author Matt Taibbi has long reported on American politics and business. With an old-school muckraker's nose for corruption, he examined the events leading up to the 2008 financial crisis in Griftopia. With Gonzo zeal, he described a two-party political system splintered into extreme factions in The Great Derangement.

And in his newest book, Taibbi sets out to explain what he thinks is a strange state of affairs:

"Poverty goes up. Crime goes down. The prison population doubles.
Fraud by the rich wipes out 40 percent of the world's wealth. The rich get massively richer. No one goes to jail."

The result of his investigation is The Divide: American Injustice in the Age of the Wealth Gap. The book explores the connections between growing income inequality and a justice system that Taibbi says disproportionately punishes the poor.

Although he found the subject matter disturbing, Taibbi tells NPR's Kelly McEvers that he took an odd sort of pleasure in writing the book.

"I thoroughly enjoy this topic in kind of a dark way," he says. "There's a kind of deviousness and brilliance that is on display in a lot of these things that is really fascinating to me."


Interview Highlights

On how he discovered 'the divide'

I was covering these gigantic Wall Street white-collar-criminal scandals, and I became interested in the concept of why nobody was going to jail, why we didn't have criminal prosecutions. And then it occurred to me that it's impossible to really talk about the gravity of that problem unless you know who is going to jail in the United States, and how those people go to jail and how that works.

What I ended up finding is that it's incredibly easy for people who don't have money to go to jail for just about anything. There's almost an inverse relationship between the ease with which you can put a poor person in jail for, say, welfare fraud, and the difficulty that prosecutors face when they try to put someone from a too-big-to-fail bank in jail for a more serious kind of fraud.

On media coverage of white-collar crime

Over time I think a kind of Stockholm Syndrome develops, it's kind of the same thing that happens with campaign reporters and candidates: You start to sort of sympathize with the people you cover in this weird subterranean, psychological way.

I think what ends up happening is these stories get written about, but they get written without outrage, or without the right tone, and they are also not written for the right audiences. They're written for Wall Street audiences who want to find out how this lawsuit turned out. They may not want to see those people thrown in jail, they just might be interested in seeing how far the government is willing to go this week in putting white-collar offenders in jail.

On comparing banks and people

The HSBC case was the biggest drug money laundering case in history. This is a bank that admitted to washing over $850 million for a pair of Central and South American drug cartels. They admit to this behavior, they pay a fine, no individual has to do a day in jail. All I really wanted to say was, here are our actors at the very top of our illegal narcotics business who are getting a walk from the government, a complete and total walk ...

I went to court that day, I asked around and said, "What's the dumbest drug case you saw today?" I found an attorney who was willing to put me in touch with a number of people who had been busted and thrown in jail for having a joint in their pocket.

It's not so much that it's so unfair that somebody who smokes a joint goes to jail. It's just that I think there's this weird psychological thing that we're developing where we just sort of look at one kind of offender and we think that person is appropriate for jail, and another kind of offender we just don't think that person is appropriate for jail increasingly, and that's what happened in this case.

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Transcript

KELLY MCEVERS, HOST:

It's ALL THINGS CONSIDERED from NPR West. I'm Kelly McEvers.

The dramatic and sordid tales of white-collar crime are familiar territory for writer Matt Taibbi. He wrote about them for years for Rolling Stone magazine. His pieces are an accessible way to a sometimes inaccessible subject, quick and dirty explanations of the kind of behind-the-scenes dealings that led to the financial meltdown in 2008.

Taibbi stopped by our studios in New York this week to talk about his new book called "The Divide." It's about an American judicial system that sees corporations as too big to fail, while seeing poor people as, quote, "small enough to jail." Taibbi told me he was a political reporter before he got the assignment to explain what went wrong with the economy. So I asked him, what made him stick with white-collar crime?

MATT TAIBBI: I probably shouldn't admit this, but I thoroughly enjoy this topic in a kind of a dark way. There's a way to look at a lot of these sort of white-collar capers in an almost admiring fashion look at the complexity of some of these schemes. And it's a real intellectual challenge to sort of unravel some of them.

And for me, it was very thrilling to go from being somebody who couldn't balance his checkbook to having to understand, you know, how collateralized debt obligations worked and, you know, how the international interest rate swap market worked. And then there's a kind of deviousness and brilliance that is on display in a lot of these things that is really fascinating to me.

MCEVERS: In addition to covering these stories on Wall Street, you then spent months on the other side of what you call the divide, in courtrooms, in jailhouses that are full of poor people who you say committed small - lots of small crimes but who are disproportionately prosecuted for them.

TAIBBI: Yeah. And so I was covering these sort of gigantic, Wall Street, white-collar-criminal scandals, and I became interested in the concept of why nobody was going to jail, why we didn't have criminal prosecutions. And then it occurred to me that it's impossible to really talk about the gravity of that problem unless you know who is going to jail and how those people go to jail and how that works.

And what I ended up finding was that it's incredibly easy for people who don't have money to go to jail for just about anything. There's almost an inverse relationship between the ease with which you can put a poor person in jail for, say, welfare fraud, and the difficulty that prosecutors face when they try to put someone from a too-big-to-fail bank in jail for a more serious kind of fraud.

MCEVERS: Yeah, it makes sense that, you know, to look at one side of the divide of how poor people are disproportionately prosecuted really throws into relief how these other people, the rich people on the top aren't.

TAIBBI: Right.

MCEVERS: But in some ways, is the comparison a little bit forced? I mean, at one point in the book, you're like, you know, just a few blocks away for where this guy's going to jail for having a joint in his pocket, this guy's walking free on Wall Street.

TAIBBI: No. I mean, I can see that point of view but, you know, the HSBC case was the biggest drug money laundering case in history. This is a bank that admitted to washing over $850 million for a pair of Central and South American drug cartels. They pay a fine, no individual has to do a day in jail. And all I really wanted to say was, here are actors at the very top of the illegal narcotics business who are getting a walk from the government. And right next door, you know, at that very moment, yes, I force the comparison.

I went to court that day, I asked around, I said, what's the dumbest drug case that you all saw today? And I found, you know, an attorney who was willing to sort of put me in touch with a number of people who'd been busted and thrown in jail for having a joint in their pocket, which is, incidentally, technically legal in New York City, or at least it's decriminalized. And so that - I did want to make that comparison.

And it's not so much that it's so unfair that somebody who smokes a joint goes to jail. It's just that there's this weird sort of psychological thing that we're developing where we just sort of look at one kind of offender and we think that person is appropriate for jail and another kind of offender we just don't think that person is appropriate for jail increasingly. And I think that's what happened in this case.

And I don't think it's a forced comparison because by itself, maybe letting off - you know, exercising some leniency with the individual actors at HSBC, you can make the argument that it makes sense. I don't agree with it, but you can make the argument. But it can't possibly make any sense if you're throwing people in jail for far less serious drug crimes. I mean, there's no justification for that in my mind.

MCEVERS: Fair enough. Do you think we should - I mean, there should be more resources dedicated to covering these kinds of stories? I mean, is one of the problems that there are just not enough journalists on the cause to expose this stuff?

TAIBBI: There are a number of problems with the way white-collar crime is covered in the press. Broad audiences tend not to be interested in the day-to-day goings on at Wall Street. And so your typical financial reporter is somebody who's from this world who maybe wants to work in an investment bank and he writes in the language and the jargon of people who work on Wall Street. And those stories tend to be completely inaccessible to ordinary audiences.

Over time, I think a kind of Stockholm Syndrome develops. It's kind of the same thing that happens with campaign reporters and candidates. You start to sort of sympathize with the people you cover in this weird, subterranean, psychological way. And I think what ends up happening is these stories get written about, but they get written without outrage or without the right tone. They're sort of written for Wall Street audiences who want to find out how this lawsuit turned out.

They may not want to see those people thrown in jail. They just might be interested in seeing, you know, how far the government is willing to go this week in putting white-collar offenders in jail.

MCEVERS: Matt Taibbi, thanks so much.

TAIBBI: Thank you, Kelly.

MCEVERS: Matt Taibbi's new book is called "The Divide." It's out this week.

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