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Getting Tough on Devastating Corporate Crime

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Politicians looking to bolster their appeal to voters like to talk about being "tough on crime." They think this creates a winning public image. And why wouldn't it? Anyone who has ever seen an old western knows that the bandits in the black hats are bad and the lawmen in the white hats are good. Consequently, many elected officials, desperate to be perceived as white-hatters, carry the "tough on crime" banner. A result is the United States now has more incarcerated people than any other country in the world, including China and Russia. Imagine -- over 2 million Americans are currently serving time in prison.

Yet despite all the tough talk from elected officials, a corporate crime wave has long swept our nation, draining people's hard-earned savings and severely harming the health and safety of millions more. The pin-stripe-suit wearing perpetrators of this spree are, far more often then not, getting away scot-free. Ironically, it's many of the same politicians who say they are "tough on crime" that are collecting millions of dollars in campaign money from the biggest crooks in America. A smart politician looking to win a campaign would never knowingly accept cash from street thugs, muggers and thieves. But corporate thugs, corporate muggers and corporate thieves? No problem! When it comes to corporate crime, where are the heroes in the white hats?

The corporate crime wave is a result of decades of concentrated effort by big business and its lobbyists to weaken and dismantle the policing agencies responsible for keeping watch over them -- a tactic that has been cleverly dubbed "deregulation," a term that effectively sidesteps any connotation of blatant wrongdoing. (See the new book Freedom to Harm by Thomas O. McGarity.)

It was the effects of wild "deregulation" that led to the global financial collapse in 2008 and its catastrophic effect on the world economy. In 2011, Charles Ferguson, director of the documentary film Inside Job, took the stage to accept his Academy Award and said: "Three years after a horrific financial crisis caused by massive fraud, not a single financial executive has gone to jail, and that's wrong." It's now two years later, and relatively nothing has changed. By comparison, in the savings and loan crisis 33 years ago, hundreds of S&L officials were convicted and sent to jail.

Grant, JPMorgan Chase and its CEO Jamie Dimon are currently in the media spotlight for their questionable dealings, resulting in billions of dollars in easily absorbed losses for the bank, yet none of its executives have been punished or charged with a crime and Dimon remains in his lofty, lucrative position. It's just another chapter in the sordid tale of big banks receiving a slap on the wrist for their excesses. The attorney General of the United States, Eric Holder, has publicly admitted that the enormous size of financial institutions has made them too difficult to prosecute. Even conservative columnist George Will wants the big banks broken up.

Once again, where are the heroes in the white hats? One of the primary issues in presenting the seriousness of the corporate crime wave is the perceived lack of physical danger from the public -- after all; corporate criminals do not rob you at knifepoint in a dark alley. But corporate crime does take a physical toll. Roughly 60,000 Americans die every year from workplace related diseases and injuries, hundreds of thousands more from medical malpractice or hospital-induced infections, tens of thousands more from air pollution and from dangerous pharmaceuticals -- much of which is a direct result of corporate wrongdoing and could be prevented.

About 400,000 Americans die each year as a result of smoking-related illness, thanks to the tobacco industry, which for years covered up the harmful effects of its product and hooked youngsters with deliberate marketing. In comparison to the nearly 15,000 yearly homicide deaths in the U.S., the corporate death toll is sky high.

One of the most important tools in battling corporate crime and informing the public about its long ranging and harmful effects would be the creation of comprehensive corporate crime database. Such a database, run by the Justice Department, would compile detailed statistics and data on corporate crime, searchable by name of corporation and crime committed, and produce an annual report. Such a database would make information on corporate crime easily available to both law enforcement and the media, and would place the issue of patterns and costs of corporate crime on the table for national discourse.

So far, all attempts to create such a public record of corporate crime have been met with little enthusiasm or action from the major political parties and successive Attorneys General, including the current AG Eric Holder. In late 2010, as Chair of the House Judiciary Committee, and again in 2011, Rep. John Conyers (D-Mich.) introduced The Corporate Crime Database Act which aimed to establish such a database. (Alongside it, Conyers also introduced the Dangerous Products Warning Act, which would make it a crime for a corporate official to knowingly place a dangerous product into the stream of commerce.) Neither bill gained any traction at all in Congress.

Further steps need to be taken as well. There should be more funding for the Justice Department's tiny corporate crime division, so that they have the prosecutorial tools and resources to adequately go after violators. Congress needs to take steps so that companies that commit corporate crime are not on the federal dole -- taxpayer money should never be used to buy goods and services from corporate criminals. It's time to crack down on corporate tax avoidance -- a worker on the minimum wage should not be paying more in sheer federal tax dollars than a large, very profitable corporation like General Electric. Going further, shareholders should have the final say in corporate governance, with the right to approve major business decisions and executive compensation -- similar to the referendum recently passed in Switzerland. After all, it's the shareholders -- not the executives -- who ultimately pay the fines when wrongdoing is discovered.

Most importantly, the obsolete and weak federal corporate crime laws need to be upgraded for the times, toughened and clearly defined. Congress and President Obama have to seek law and order for crime in the suites. For rampant corporate crime is going to continue unless we start punishing and deterring these violations that devastate so many innocent people.

To stay informed on the latest news in America's corporate crime wave, visit corporatecrimereporter.com. For more on this subject, see the chapter "Crack Down on Corporate Crime" of my new book, The Seventeen Solutions: Bold Ideas for Our American Future. Available and autographed from Politics and Prose, an independent book store in Washington D.C. .