'Total Moral Surrender': Matt Taibbi Unloads on Wall Street, Inequality and Our Broken Justice System
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His relentless coverage of Wall Street malfeasance turned him into one of the most influential journalists of his generation, but in his new book, “ The Divide: American Injustice in the Age of the Wealth Gap,” Matt Taibbi takes a close and dispiriting look at how inequality and government dysfunction have created a two-tiered justice system in which most Americans are guilty until proven innocent, while a select few operate with no accountability whatsoever.
Salon sat down last week with Taibbi for a wide-ranging chat that touched on his new book, the lingering effects of the financial crisis, how American elites operate with impunity and why, contrary to what many may think, he’s actually making a conservative argument for reform. The interview can be found below, and has been lightly edited for length and clarity.
So, what is “The Divide”?
The book is really just about why some people go to jail and why some people don’t go to jail, and “the divide” is the term I came up with to describe this phenomenon we have where there are essentially two different criminal justice systems, one that works one way for people who are either very rich or working within the confines of a giant systemically important institution, and then one that works in another way for people who are without means. And that’s what the book is about.
A point you make in the book, though, is that the justice system is starting to treat people who aren’t poor or part of a marginalized group with a level of brutality we tend to think is only reserved for the oppressed.
I made a conscious decision to start the book with the story of Abacus Federal Savings bank, which is this little bank in Chinatown. The people who run that bank were not poor. They weren’t even what you would typically classify as members of the victim class … But why was that bank prosecuted and why was Goldman Sachs or Chase not prosecuted? What I was trying to get at was, in this new reality, [legal authorities] consider it not feasible to go after companies of a certain size, and [Abacus] is how small you have to be now to be targeted …
There was an SEC commissioner who talked about “shot selection,” like in basketball, [and] how you should go for the baskets with the greatest chance of scoring. So while it may be more satisfying to go after the bigger companies, you’re more likely to get a successful action against a smaller company.
So it’s not just about poor people, it’s also just about the way the regulatory system works. Bureaucracies organically flow toward the easier result, and the easier result is always a smaller company, an undefended person, a low-level drug dealer. They hesitate before it decides to proceed against a well-heeled, well-defended company [against which] they’re going to have to fight for years and years and years just to get the case in court … It’s not just about the poor, it’s more about how there’s a class that enjoys impunity and then there’s everybody else.
Do you think this is a new development?
Well, certainly the rich have always had it easier than the poor. I think that’s a story as old as a story can be. But what we’re seeing recently — and I tried as much as I could to trace this — is that there have been a couple recent developments that have significantly worsened the situation, both going back to the Clinton years: Clinton signs on to welfare reform, Clinton and the Democrats begin to court the financial services sector and begin to adopt deregulatory policies.