Over the last few months, there’s been a growing drumbeat for calls to defund the police, which, of course, has been met with much consternation from those on the right and political center (and even some on the left). But here’s the thing: America has been defunding the police for more than 40 years. We’ve just been defunding the police for rich people. You know, the “cops” at agencies like the IRS, SEC and DOJ — the ones who fight white-collar crime.
In fact, according to Syracuse University’s Transactional Records Access Clearinghouse, which documents trends in federal law enforcement, “The latest available case-by-case records from the Department of Justice show that the prosecution of white-collar offenders in January 2020 reached an all-time low since tracking began during the Reagan Administration.”
Along those lines, the Trump administration has gone out of its way to diminish the forces that police industrial regulations. In 2019, it even bragged that it had “cut eight and a half regulations for every new rule, far exceeding [its] promise to cut two regulations for every new one.” As Elizabeth Warren pointed out on the campaign trail, “Deregulation is code for ‘let the rich guys do whatever they want.’” And so far, Trump has done exactly that. To date, he’s repealed regulations for offshore oil drilling; he’s rolled back EPA regulations on vehicle emissions and coal and nuclear power plants; and most strangely, he’s fought to give restaurants the legal grounds to insist that the tips of waitstaff be pooled, allowing restaurant owners and managers to take a share of them.
Worst of all, though, the Treasury Department has curtailed Obama-era banking regulations created in the wake of the 2008 Financial Crisis. Under Trump’s lead, the Security and Exchanges Commission (SEC), which is responsible for Wall Street oversight and investigations, has become a moribund agency — defunded and de-emphasized. “The government agency responsible for policing Wall Street brought the fewest number of insider trading cases in decades, according to the most recent available data,” NPR reported in August. Meanwhile, PricewaterhouseCoopers believes that “fraud is at an all-time high.”
Not that Trump (or Republicans) are the only ones to blame for defunding the police for rich people. Dating back to the Reagan administration, there has been a bipartisan effort to advance deregulation, and Obama was unquestionably bad about pursuing financial law enforcement, with only one banker ever convicted of the devastating crimes they committed against the American people during the 2008 Financial Crisis.
It’s very on-brand for the “too big to fail” banks to act as though they’re above-the-law. But realistically, they are — and more so every year. “In the mid-1990s, white-collar prosecutions represented an average of 17.6 percent of all federal cases,” the New York Times reported back in 2014. “In the three years ending in 2012, the share was 9.4 percent.”
As Harvard Business Review has outlined, the U.S. is still home to a healthy amount of financial crimes enforcement; however, the ones who are typically punished most severely are women, people of color and young white men who have yet to become C-suite executives. To that end, the aforementioned banker who was found guilty for his role in the 2008 Financial Crisis was an Egyptian-American named Kareem Serageldin. Even the judge in his case noted that what Serageldin had done was “a small piece of an overall evil climate within [his] bank and with many other banks.”
HBR cited “cronyism and favoritism” as a significant factor here. For example: “Senior women, who are often seen as outsiders in informal male social networks and are less likely to have close personal relationships with the male decision makers who determine punishments, are disciplined more severely than senior men who’ve committed crimes of the same type and magnitude.” This is equally true for people of color, and doubly true for women of color.
It would seem then that the trends in the policing of white-collar crime look very similar to actual policing.
And again, the Democrats have been fully complicit. In 2011, President Obama wrote an op-ed for the Wall Street Journal, in which he promoted a very Bill Clinton-esque view of business, praising deregulation as the cornerstone of future economic growth: “Throughout our history, one of the reasons the free market has worked is that we have sought the proper balance. We have preserved freedom of commerce while applying those rules and regulations necessary to protect the public against threats to our health and safety and to safeguard people and businesses from abuse.”
This is almost note-for-note what Clinton said after he signed the Financial Services Modernization Act into law in 1999, which repealed Glass-Steagall financial protections dating back to the Great Depression, and set in motion the market dynamics that would result in the 2008 Financial Crisis. “Over the [past] seven years, we have tried to modernize the economy. And today what we are doing is modernizing the financial services industry, tearing down those antiquated laws and granting banks significant new authority,” Clinton decreed.
But as has been apparent since the dawn of time, crime isn’t something that only occurs in dark alleys and mean streets, it also occurs in boardrooms and the halls of power. As the villain on Mr. Robot reminded his fellow high-powered financial criminals: “Give a man a gun and he can rob a bank; give him a bank and he can rob the world.”
Calls to defund the police ask that we reconsider what our priorities are for law enforcement, and what the best ways are to reduce crime. Anyone who has ever called the police before a crime has taken place knows that the cops will tell you they can only respond once that crime has been committed. Thus, their only real preventative value is the fear that if you commit a crime, the police will find you and you will be punished. Rich people, however, don’t have that fear. Not for the crimes they commit.
That’s because for the last five decades, our elected officials have worked across the aisle with wide bipartisan support to systematically defund the police for the rich, while at the same time militarizing the police for the rest of us. So ask yourself this: When a banker turns criminal, they have the power to jeopardize the entire world with their crimes. George Floyd allegedly passed a counterfeit $20 bill and was killed for it.
Which one would you prefer we police?