“Occupy Wall Street”: The Rich
Plunder, the People Rise Up
By Chih-Chieh, Lin (associate professor at Institute of Technology Law at National Chiao Tung University)
Translated By Peixin Lin
4 October 2011
Edited by Gillian Palmer
Taiwan - UDN - Original Article (Chinese)
According to news reports, the “Occupy Wall Street” protest movement is intensifying. Various groups are taking to the streets, expressing their discontent with the political system and capitalist rule and demanding that Obama set up a committee to end the rich’s influence on Wall Street. They protest that the current financial system is the main cause of the economic crisis and social inequality, including an unfair taxation system and unfair distribution. The hatred for the rich continues to build up and could lead to an explosive situation.
The U.S.’ liberal financial policy was once hailed as a model for financial innovation. Former Federal Reserve Chairman Alan Greenspan also praised the U.S. financial market as the most effective market, thinking that only the stupid would carry out market regulation. He famously said, “Why do we wish to inhibit the pollinating bees of Wall Street?” Influenced by liberal economics, the U.S. adopts a “small government, big market” strategy in relation to businesses and the financial industry, with less and less intervention. To increase profits, financial institutions created many derivatives; corruption involving enterprises was common.
The 2001 Enron scandal exposed that major banking corporations, using investors’ and depositors’ money, had links with Enron, pocketed profits and even partook in illegalities such as fake transactions and doctoring financial reports. Following the subsequent scandals involving various corporations, many studies pointed out: After 1980, the rich and corporate lobbyists, through campaign contributions and influence over politicians, successfully got the government to liberalize. Washington thus continued to support privatization and the loosening of regulations; however, the lack of supervision and an attitude favoring corporations enabled unscrupulous profiteering, leading to a country in which the rich rule and the public becomes debt-ridden.
The U.S. is the ultimate capitalist nation — it has always been generous to businesses. In addition to the lack of administrative control and taking the soft approach of seeking cooperation and giving advisement, it also keeps businesses well-protected from legal responsibilities. If the average shareholder wants to sue an irresponsible director or manager, he not only faces multiple barriers, but in presenting the required proof, he faces a greater burden than in other civilian legal procedures.
With such legislative and executive protection, and the further judicial protection from civil liability businesses get, criminal liability has ironically become the primary means to deal with white-collar crimes. Prosecutors could use the concentrated hatred the public has toward the rich; in recent years on Wall Street, criminal litigation cases or cases involving comprehensive corporate reforms as settlement or as condition not to litigate have increased. With every case, every guilty verdict against the rich, the public proclaims that justice is served.
However, the strategy of using criminal law as a control against white-collar crimes brings about even greater problems. When a corporation, especially a large one or even a transnational corporation, is found guilty, the ensuing bankruptcy or reorganization leads to immeasurable losses to employees, investors and even the market. Moreover, when subjected to a criminal investigation, the company’s loss in business reputation, the use of enforced strategies that threaten the privacy and trade secrets of the company and the impact on share prices during the process could all lead to irreparable consequences.
Life naturally finds a way out. The current “Occupy Wall Street” movement, along with the strategy of mainly using criminal law to deal with illegal corporate activities, result from the U.S.’ own actions. When the legislature is controlled by a minority, when administrative controls fail and when the judiciary fails to enforce civil liability, the rich and corporations do not understand their social responsibilities, knowing only to have their fill in the midst of showcasing their wealth and plundering, extracting resources from society, the natural instinct for distributive justice kicks in, inevitably leading to the use of criminal law to exact justice and even to a people’s uprising.
The U.S. experience, which serves a warning, is not far off in history; for politicians starting to fight for the “first-time voters” government (referring to the 2012 Taiwan elections, as both major parties look to attract “first-time voters”), thinking about what social justice is should be a priority.
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