Big Dirty Money: The Jennifer Taub Interview
In the first of this two-part interview with Jennifer Taub, author of Big Dirty Money, she breaks down definitions – “dirty money”, “dark money”, “white-collar crime” – and fields questions about why no one in power is doing much to remedy these crises. Taub explains the devastating impact of white-collar crime on ordinary Americans, and discusses the Sacklers and other corporate criminals who have caused mass death.
Andrea Chalupa:
Happy holidays. We're excited to announce that Gaslit Nation is co-hosting a phone bank for Georgia with our friends at Indivisible. You can join us on January 4th from 4:00 PM to 6:00 PM Eastern to hang out on Zoom and make calls to Georgia voters.
Andrea Chalupa:
Until then, do all that you can to make calls, send texts, and donate what you can to Jon Ossoff and Reverend Raphael Warnock. Sign up to volunteer on their official campaign websites or with Stacey Abrams’ groups, Fair Fight Action at fairfight.com or New Georgia Project at newgeorgiaproject.org. Our democracy doesn't work unless we do.
Andrea Chalupa:
Welcome to this very special episode of Gaslit Nation. We are speaking with the great Jennifer Taub, a legal scholar and advocate devoted to making complex business law topics engaging inside and out of the classroom. Her research and writing focuses on corporate governance, banking and financial market regulation, and white-collar crime. Similarly, her advocacy centers on follow-the-money matters, promoting transparency and opposing corruption. Her new book, Big Dirty Money: The Shocking Injustice and Unseen Cost of White-Collar Crime came out this fall.
Andrea Chalupa:
Taub was a co-founder and organizer of the April 15, 2017 Tax March, where more than 120,000 people gathered in cities nationwide to demand that President Donald Trump release his tax returns, which he still has not done. She is a professor of law at the Western New England University School of Law, where she teaches civil procedure, white-collar crime and other business and commercial law courses. And she was the Bruce W. Nichols Visiting Professor of Law at Harvard Law School. Taub has written for The Washington Post, CNN Opinion, Slate, The New York Times DealBook, Dame Magazine, among other outlets. Welcome to Gaslit Nation, Jennifer Taub.
Jennifer Taub:
Thank you for having me. I can't believe I finally get to talk to you, finally, in person, I guess you could call it.
Sarah Kendzior:
As in person as we can get these days. We're very excited to have you on. And so, we're just going to open with a general question. As we said, your new book is called Big Dirty Money. So, what is dirty money? How would you define that for our audience?
Jennifer Taub:
I think of dirty money—with an emphasis on the dirt—as being any kind of proceeds from criminal or corrupt activity. And I just want to be clear, I used the word “big” in the title to some degree as an homage to Trump because he always likes to talk about things being “big” or “bigly”. Also, it would be a nod to this way that we talk about industries like Big Pharma or Big Ag, right?
Jennifer Taub:
The way we talk about the way they’re nearly monopolization, but not always, at least these kinds of concentrated powers in certain industries. So, when we talk about Big Pharma or Big Ag, it's the opposite of things like your local pharmacist or your local organic farm that you might shop from.
Jennifer Taub:
And so, when I think about big money, big money could be Wall Street. So when I add the big dirty money, I'm trying to emphasize this idea of proceeds from criminal activity, money laundering, tax evasion, but not small time crooks. Not the person who takes money from the cash register. I'm talking about the big kinds of global kleptocrats that have now essentially taken over the presidency. And I consider Trump to be one of them. So Big Dirty Money is meant to talk about white-collar crime in its current manifestation right now in 2020.
Sarah Kendzior:
I was just thinking about how the phrase “dark money” has entered the vernacular, in part, because of Jane Mayer's book, in part because of things like Citizens United. How would you define dark money and where's the intersection between dirty money—where, as you said, it emphasized proceeds from criminal activity and not small time criminal activity either—and dark money?
Jennifer Taub:
Oh, I love this question. And no one has asked me before, but if I had a whiteboard in front of me, I would draw you a circle. Imagine a big circle, and at the top of it, I’d label that dark money. And then I’d draw a circle, not inside of it, but overlapping. And I’d call that dirty money.
Jennifer Taub:
So, some dark money—because we don't know where it's coming from or how it's been sourced—some dark money is dirty money, is the proceeds from criminal activity, right? And dark money, when we've heard of dark money, we mean mostly—and I think what Jane Mayer meant in her book is money that you don't know the source of that's getting into the political system, both in terms of electoral politics and lobbying, right?
Jennifer Taub:
So, there is a portion of dark money that may very well be from criminal activity, but there is a lot of dirty money that is involved in all sorts of things, not politically connected. So, there's dirty money involved in legitimate businesses and corrupting them. Dirty money can be involved in the nonprofit sector. So again, I would think of these things as overlapping circles.
Sarah Kendzior:
Out of curiosity, have you read Mueller's Iron Triangle speech from 2011, The Evolving Organized Crime Threat? Because what you're saying reminds me a lot of what was in that speech; the warning that it gave to the nation that they are overlapping circles, that overtime those lines between organized crime and white-collar crime have blurred, and they have also infiltrated our institutions. I was just curious if you had any thoughts on that speech and also on why nobody did anything with the results of that analysis.
Jennifer Taub:
Talk about taking notes. I mean, who's taking notes for me to tell me I need to read that now? So, thank you. I think that was Sarah?
Sarah Kendzior:
That was me, yeah.
Jennifer Taub:
What you just said to me about this overlap is something I've been thinking so much about ever since I read Tom Burgis's new book, Kleptopia. I don't know if you have read that. I did a review of it for The Washington Post. He's a reporter for the FT in England. It's really a tremendous book. But what he talks about in this book, he references a Jewish writer who escaped Austria, or Nazi Germany, and came to the U.S, who talked about this thing called the dual state. His last name was Fraenkel. And this idea of a dual state, I think, captures what you're talking about and what we've all been thinking about.
Jennifer Taub:
And this dual state is this idea that when you have a corrupt system or a corrupt leader—and this is, obviously Ernst Fraenkel was writing about Nazi state, right?—that you have the normative state, which is the part of the government and the rules that everyone has to follow so that the trains keep running on time, and contracts are enforced, and money currency still has value. So, that's the normative state.
Jennifer Taub:
And there's something else called the prerogative state, where people who have power don't have to follow the rules and can siphon, and cheat, and kill and all the things they do, and that this dual state that these two things, the normative state and the prerogative state, they're not parallel to each other, but the prerogative state controls the normative state.
Jennifer Taub:
And I've been thinking so much about that. And so, I want to actually read his work and also obviously now read this speech that you've talked about. And these parallel... I'm using the word parallel even though in the case of Fraenkel, one controls the other. These kinds of parallel systems exist in other areas even where it's not criminal.
Jennifer Taub:
So, my last work was on the financial crisis, a book called Other People's Houses. And with that and other work—more academic pieces I've talked about, and you've heard about shadow banking. And shadow banking is a space which is lightly, now, lightly regulated as compared to the depository and broker dealer investment banking system, which is more heavily regulated. And these two things interact. These two kinds of banking systems interact with each other. In fact, there's more money in the shadow banking system.
Jennifer Taub:
A mentor of mine once described this shadow banking system, Jane D’Arista described it as the parallel banking system. She learned that expression from Minsky, who was an economist who people really looked at during the meltdown. So, I guess all this is to say I think that there's always a challenge when you have folks who have a lot of power who find it that they can't profit or have as much power if they follow the rules. They not just break the rules, but they try to take control of the apparatus that enforces the rules so that they can kind of make everybody else obey while they benefit from stealing and cheating themselves. So, yes. I see these all as connected.
Sarah Kendzior:
Yeah. That's a really interesting phrasing. I mean, I think that's exactly what the Trump administration and also prior administrations have done. It's not just break the rules but take control of the apparatus that makes them. And we've certainly seen this with the actions of Bill Barr, with this kind of positioning of him not as the attorney general for the United States, but as Trump's personal lawyer.
Sarah Kendzior:
This is a process that's associated with the transition of countries from democracies to autocracies. How far along that process would you say we are now, and is it reversible assuming Biden does come into office in January?
Jennifer Taub:
Yes. Before I answer how far along I think we are and if it's reversible, let me say two things first. I'm not a political scientist, I'm a law professor and I'm observing this stuff in that way. But one other thing I want to say is, in both of your work, you've thought about these things. And I look at somebody like Putin, right? That it's not just a transformation.
Jennifer Taub:
These things don't just happen when there's a transformation from a democracy to a more authoritarian or autocratic system, but whenever there's an upheaval, right? So if you look at The Soviet Union trying to transition, maybe trying to transition or thinking it was going to transition to a market economy, right? And we saw what happened there in terms of this upheaval, who's going to have control? Who's going to have power? A really great way to maintain power is to have a group of oligarchs one level down who you task and you control.
Jennifer Taub:
And if they don't obey and let you do your own dirty work and collect your own dirty money and power, then you can prosecute them, right? Because actually, you let them break the law and now you don't let them do it anymore. My fear is that we could be in that kind of world. And as we see this discussion of Trump maybe issuing these kinds of blanket pardons for people, you sort of see that happening here.
Jennifer Taub:
How far along are we? I mean, I think we're all talking on the radio or podcasts. I do not see that... our toes are in the water. Maybe we're ankle deep or knee deep, but I think there's a way to back out of this. But even today, we're watching over the next week, and even until January, this so-called peaceful transition of power is anything but.
Jennifer Taub:
I mean, I think the Republican Party, for the most part, is utterly captured right now by a kleptocrat, a very dangerous authoritarian kleptocrat type person with deep ties, as we know, to Putin and great admiration for other strongmen leaders who steal and punish in the ways we've talked about. So, I don't know what things look like 5, 10 years from now, but the problem is, and so I'm running on here. I mean, the problem is Trump didn't come from nowhere, right? And someone like him was only able to rise to power because our system beforehand let people like him get a pass. And people who are wealthy, white and well-connected get second, third and infinite chances.
Jennifer Taub:
And something that I want to emphasize here is I firmly believe that if Donald Trump had been accountable or held accountable for the many offenses that he committed prior to running for office, I think he would have spent time in federal prison instead of The Oval Office.
Andrea Chalupa:
Wow. So, I want to read from the Mueller Iron Triangle speech because your book is essentially the cliff notes for so much of what Mueller is warning us about. It's weird. It's like this corporate mafia in the U.S where corporations can get away with poisoning their own workers, poisoning the public, and you can't sue them. You can't hold them accountable, or they get away with a slap on the wrist. And then you have the drug dealers of the opioid crisis—the Sackler family—getting off with a slap on the wrist and so forth.
Andrea Chalupa:
So, while there is this sort of 21st century Russian mafia that depends on fancy law firms and fancy accounting firms to launder their money and spread their wealth and influence, we in America have also this corporate mafia that acts above the law. But just to illustrate the core of this, what we're up against, I'm going to read from the Mueller Iron Triangle speech so our audience can get a taste of that and then go read your book for the big in-depth look at all of this and how it works.
Andrea Chalupa:
And you name names as well throughout your book, which is so gratifying, because at least that provides a feeling of accountability. Just an independent record, which is just so essential to preserve and stay vigilant of, and hopefully use that to create some sort of meaningful legislation soon, some reckoning.
Andrea Chalupa:
So I'm going to read from the speech nowL "We are investigating groups in Asia, Eastern Europe, West Africa, and the Middle East and we were seeing cross-pollination between groups that historically have not worked together. Criminals who may never meet, but who share one thing in common, greed. They may be former members of nation-state governments, security services, or the military. These individuals know who and what to target and how best to do it."
Andrea Chalupa:
"They are capitalists and entrepreneurs, but they're also master criminals who move easily between the licit and illicit worlds. And in some cases, these organizations are as forward-leaning as Fortune 500 companies." And it goes on to say, "This is not The Sopranos." This is Mueller talking by the way, "This is not The Sopranos with six guys sitting in a diner, shaking down a local business owner for $50 a week. These criminal enterprises are making billions of dollars from human trafficking, healthcare fraud, computer intrusions and copyright infringement. They are cornering the market on natural gas, oil, and precious metals and selling to the highest bidder."
Andrea Chalupa:
"These crimes are not easily categorized, nor can the damage, the dollar loss or the ripple effects be easily calculated. It is much like a Venn diagram where one crime intersects with another in different jurisdictions and with different groups."
Jennifer Taub:
Wow. I'm going to add that to the paper bag, thank you.
Andrea Chalupa:
It's your book! I mean, you go in and you name the names of who Mueller is talking about.
Jennifer Taub:
Yeah, I mean, it's great. It's interesting. I had never read that, but I suppose if you open your eyes and look around, you don't need to be the former director of the FBI, or later a special counse,l to see the world as it is. But as you said, Sarah, I think we know the answer, but let's pose the question. Why doesn't this get more attention?
Sarah Kendzior:
Well, it's a weird thing. I mean, I excerpted this speech in my book as well. Because my question was, this is from 2011, and now in 2020 and as well as in 2016 we were already living in the repercussions of what Mueller described. His predictions had all come true because they weren't really predictions, they were just descriptions of an ongoing crisis that was getting worse and worse and worse.
Sarah Kendzior:
But he, unlike us, was in a position to remedy it—first as the FBI director, then as the special counsel—and we've seen this throughout the justice system. It's not like Mueller was some obscure guy ranting on his blog. He gave this big speech that plenty of people heard, and there just seems to be this refusal to act on it, and even in many cases, to acknowledge that these conditions exist.
Sarah Kendzior:
I was just wondering if you had comments on that: both the lack of action and whether in your experience, as someone who documents this, whether you get people shrugging it off, like, "Oh, well, that's just capitalism," or, "That's just America," or "That's just the way things are. What are you going to do about it?" Our question on Gaslit Nation has always been, well yes, what are you going to do about it? Because you do need to do something.
Jennifer Taub:
I just love this. And talking with the two of you, I mean, I know that we're just hundreds of miles apart and we're talking for a podcast and we're not in person, but I just feel so comfortable because I'm coming up with new metaphors just thinking about this. So, Andrea, in response, the way I look at it as this. It's almost like removing a tumor. You know how you hear sometimes a poor pet has a tumor, but it's too close to their heart or too close to some sort of nerves, and you really can't do the surgery because it's too entangled? Are you with me?
Andrea Chalupa:
Yeah.
Sarah Kendzior:
Mm-hmm (affirmative).
Jennifer Taub:
That's my metaphor because...how do I put this the right way? I teach corporations, right? I like markets that are regulated. I do like the idea, some aspects of capitalism and business enterprises where they can organize labor—similar to the way that labor unions organize labor—organize labor, organize intellectual property and help create things that we love, things that we need, things that enrich our lives. There's no question.
Jennifer Taub:
And so, at the same time that I have a critique of pieces of Big Pharma, like the Sacklers and the others who participated in getting hundreds of thousands of people not just addicted, but dying of just prescription opioid overdoses alone, I still want and believe we need really strong Big Pharma. Think about today. We have Pfizer giving the very first vaccines for COVID-19 over in the UK and we're celebrating that and we're trusting that process.
Jennifer Taub:
So, all of us contain, I think, in our minds an understanding that we want functioning businesses. Separate from that, even as we are critiquing—and I do—the way corporations, because there isn't enforcement and accountability for the individuals who know about the harm they're causing and the cheating they're doing because they do bad things, it's like, I don't want them to do the bad things and I think incentives matter, including fines, punishments, being fired, being shamed and shunned, all that works.
Jennifer Taub:
At the same time, let's hold this alongside the fact that, who's doing the regulating and the punishment? When we look at our government right now... We always say, well, we don't want bad politicians in office, but we have a lot of corrupt and bad ones in there now. And not just ones that are corrupted, let's say, by business interests, but some that are absolutely bat-shit loony. I can't say that on the radio, right?
Sarah Kendzior:
Oh, you can say it here. [laughs]
Jennifer Taub:
And no offense to people with mental health issues, but we have completely just off the rails people who were just elected to Congress who believe in these crazy conspiracy theories. When I compare my experience in the private sector to some of these people I see who are elected to office, I think the business sector overall has held up pretty well. Right?
Jennifer Taub:
So, I think you're right. Some people say, "Well, we need business, and there are these collateral consequences that come from the prosecution guidelines, so let's just kind of look the other way." And that's not my attitude. My attitude is like the metaphor I more often use in this tumor that's entangled, my attitude is more like, if you live in a house or an apartment, you need to constantly make sure it's repaired and cleaned and you don't burn it down because there's a mess in the kitchen. Right? But you can't also not let it get overrun and the roof can't fall in.
Jennifer Taub:
And so, we need a system where we have honest, good people who aren't captured making sure those with the most power are held accountable when they cheat and harm customers, suppliers, their employees, and so on. And so, I guess what's hard is I think that sometimes we take an all-or-nothing approach, like the stance that all corporations are bad. That doesn't really help us say, "These businesses offer a lot of good, but right now they're getting away with murder. What do we do about that?"
Jennifer Taub:
And I just wish there were more interests in saying we need to excise cancers, we need to fire the bad leaders, we need to crack down and create a level playing field so the cheaters don't prosper, so that we can have successful businesses. That was a long roundabout thing, but I hope you heard what I meant.
Andrea Chalupa:
Yeah, no, absolutely. How does the justice system work for white-collar crime?
Jennifer Taub:
I believe currently the justice system caters to white-collar criminals. When I say white-collar criminals, I'm referring to white-collar criminals in the sense that Edwin Sutherland who coined the term meant it: those people who have high status and are people of respectability who commit crimes in the course of their occupation. So, right now, the people who tend to be the most privileged, powerful white-collar criminals can hire the best lawyers.
Jennifer Taub:
And everywhere along the way, from whether you are caught, to whether you'll be investigated by a regulator, to whether the regulatory agency will refer to the criminal enforcement apparatus whether it's at the state or at the federal level, whether that will result in the Department of Justice or a U.S Attorney's Office beginning to bring a case, how the plea bargain works or how the trial goes down in terms of how the jury treats such people, ultimately in the rare case that there is a conviction or a plea in a sentence where you end up in prison, when you end up at one of these prison camps versus a facility for people who are "dangerous".
Andrea Chalupa:
Like a Club Med, like a Club Fed, right?
Jennifer Taub:
Club Fed. When I teach my white-collar crime class, I show my students pictures and the slides of these facilities. And we take a look. It's really kind of fun. You can go onto the Bureau of Prisons website and they have an orientation packet. You can just download the PDF. It's kind of like “welcome to campus” and what you can do and what you can't do. And they all have bocci and they have other kinds of activities, basketball courts. They tell you when you have to be in, before dark. There's always a commissary list where you can get, like, Twizzlers, sun tan lotion, sunglasses, matzah ball soup. I don't think their matzah ball soup is probably as good as mine, but it's... Can I tell you guys something that's on my mind?
Andrea Chalupa:
Sure.
Jennifer Taub:
So this goes right to how the system caters to white-collar criminals. Yesterday, I attended a Zoom, which was for a New York Bar Association continuing... You can get credit for continuing legal education. I don't need those credits, but someone told me about it. It was about sentencing white-collar criminals. The people speaking on the panel were current, and some former, federal judges, as well as white-collar defense lawyers, because it was for the New York Bar Association for the criminal defense bar section. Right?
Jennifer Taub:
And I was utterly flabbergasted, because it was worse than I even thought. I mean, they were complaining about the sentencing guidelines that have been created by The U.S Sentencing Commission. And to make a long story short, there was a period of time when there was a concern that there was disparities in sentencing. So, there were these mandatory sentences to the sentencing commission, these guidelines that were mandatory. And those were found to be unconstitutional under this case called Booker because it was... It's one thing for Congress to enact a law that creates mandatory minimums. It's another thing to have this sentencing commission do it.
Jennifer Taub:
So now these sentencing guidelines are mere guidelines. They're advisory. But judges feel a lot of pressure to stay within these guidelines. And you might remember when there was the sentencing of Flynn, this whole debate about—and Manafort, right?—one of the judges wanted to ignore the guidelines. You might remember this thing.
Jennifer Taub:
So, these lawyers were complaining about the guidelines and how it was really hard. A young judge would be so conservative with the guidelines and how they wouldn't take into account all the charitable things that their clients had done. This is the problem. Baked into the guidelines as well as baked into the federal law, one of the things judges are supposed to consider is the person's character and whether they've been a credit to their community.
Jennifer Taub:
And this was like a how-to guide. It's what I've always been concerned about. And this is what Madoff did. If you are cheating and you know you are, it's really important to give some money to all the good causes, and the art museums, and the music centers, and some charity, and especially to do it as these judges note, give some money away and not tell anyone about it. So when it comes time when you get caught, people will write letters saying all the good things you did for the community. And that will really help in sentencing.
Jennifer Taub:
And it's not fair to those who don't have the ability, the kind of people who are sentenced who either where there are mandatory minimums built into the statute, even the white, wealthy people who got their money through cheating and fraud and crime are much better off than someone who is not in that category who maybe did a small time crime. They're going to spend a lot more time in prison—and a dangerous one—than the wealthy, because they can hire lawyers and they can give money away to charities to pave the way to a lighter sentence.
Sarah Kendzior:
I'm curious because you brought up Manafort, which is a case we were watching very closely. And his sentencing, which was much less than what was anticipated he was going to be given. He was given a relatively small sentence and then, notably, the judge referred to him as somebody who had led "an otherwise blameless life". And Manafort doesn't quite fit the description of the kind of characters you were just describing right now.
Sarah Kendzior:
People like the Sacklers who plaster their names on art galleries or universities, or try to put up this facade of charitability. I mean, he was a straight out mobster, a straight out gangster. I was just curious, what reason do you think he got off so light? And then I have other questions about him, but I'm just curious about that piece.
Andrea Chalupa:
We've got a slumber party of questions for you. So, I hope you're wearing your comfortable jammies for this conversation.
Jennifer Taub:
I thought we were going to be Zooming on camera, so I've got, like, the makeup, a nice top.
Sarah Kendzior:
Well, I'm in my bathroom, so that's not happening, but go on. [laughs]
Jennifer Taub:
So, can we promise this, after the pandemic when we're all vaccinated, can we find ourself in the same city and do a slumber party?
Andrea Chalupa:
Sure.
Sarah Kendzior:
Yes. Yes. Absolutely. White-collar crime slumber party it will be.
Jennifer Taub:
So, what's really interesting, yeah, I mean, one thing to remember (and I'm sure you and your listeners remember this), Manafort had two different criminal cases against him. And it was only one of the judges who went particularly lightweight. It was judge T. S. Ellis. It is astonishing, except it's something that was recognizable. So, when I heard T. S. Ellis say that Manafort had lived an otherwise blameless life and earned the admiration of a number of people, this is exactly how it always goes down.
Jennifer Taub:
What Ellis also said, though, is he pointed...he said that the guidelines range was "totally out of whack" and he was comparing that to the light sentences for other white-collar criminals. Right? So, instead of the rent's too high all over, or instead of all the sentences are too easy, the judges actually look at other sentences, and in fact, in the event I attended yesterday, they said, "One thing you should do when you're talking about sentencing with the judge is give them a spreadsheet of all the similar crimes that went either unpunished or with low prison sentences." Right?
Jennifer Taub:
So, if you have a system that is increasingly being very charitable to certain kinds of white-collar criminals, that helps a judge justify departing substantially from the guidelines. What's also interesting is what the judge ignored. He said he had lived an otherwise blameless life, but Virginia Heffernan, the columnist (and I'm quoting it from my book), she said, "Manafort has been known for more than 40 years as a member of the torturers lobby."
Jennifer Taub:
Heffernan also said, "Manafort amassed millions by essentially deflecting criticism of his brutal clients and opulently enabling them.” Right? On top of that, even though he was sentenced, they let him out. The Bureau of Prisons released him in May, letting him serve out the remainder of his seven and a half year sentence, for both cases combined, in home confinement. And this was because he was taking advantage of Attorney General Barr's attempt to ease overcrowding in the system, but he didn't actually meet any of the early release criteria.
Jennifer Taub:
It was only supposed to be for people who had served half of their sentence—and he hadn't—or had just 18 months left. And so, can I just rant a little more, which is, if the coronavirus is no big deal (as Trump said) and it's not a danger to anyone, then why is Manafort out? Someone can't give him a vaccine so he can go back in?
Andrea Chalupa:
Yeah, exactly.
Jennifer Taub:
Instead of ranting about that, back to my main point. When I heard that judge Ellis used those words, that he had led an otherwise blameless life, what it reminded me of, it's almost verbatim from a case in my white-collar crime case book. And back in 1976, there was a guy named Bernard Bergman who'd been caught in a $2.5 million Medicare and tax fraud scheme involving nursing homes.
Jennifer Taub:
He pleaded guilty to two related charges, but he never admitted any wrongdoing. And the laws he violated at the time (this was before the guidelines) allowed eight years in prison. That's what would have been permitted, but the judge gave him just a four month sentence. The prosecutor was quite upset and did a press conference and said, "This seems like special justice for the privileged."
Jennifer Taub:
But what's amazing is the judge said that he thought his four month sentence was “stern”. And after the sentence—remember this guy, Bergman, never said he was sorry, he never admitted to wrongdoing—he issued a statement to the press saying that he'd been cleared of the, "wild and vicious allegations that were made against me in the press."
Jennifer Taub:
It's amazing that the judge rationalized the sentence. And here's the quote. It sounds just like Ellis and Manafort. The quote is, that Bergman “appeared, until the last couple of years, to be a man of unimpeachably high character attainments and distinction." Yeah. I mean, he had just got caught. That's what happens. People think you're really a mensch until they find out you've been cheating.
Jennifer Taub:
It just seems like this should cut the other way. If you know better, if you're a person of high attainment and distinction, and if supposedly you only just started cheating in the last few years, why would you do that? Shouldn't that kind of person who has all the trappings of respectability be the kind of person who shouldn't cheat?
Andrea Chalupa:
Mm-hmm (affirmative).
Jennifer Taub:
What are their excuses? But that's not how judges looked at it. And I will let you know that all three judges on the panel I attended yesterday via Zoom were older white men.
Andrea Chalupa:
Of course.
Jennifer Taub:
And I think they identify with people who are like them. I mean, it works. That's why the three of us are like, we're like, let's have a pajama party. Guys, they might be saying let's have a pajama party. That would not be cool. Right? People tend to identify, bond with, want to give second chances, to people who seem like them. And that's how the system is working.
Andrea Chalupa:
Right. It's a system of white men in the service of other white men. So, we're here having this conversation, and obviously a lot of...how do I say this? So, Sarah and I were on a Zoom call recently. [laughs]. We were accused of being coastal elites.
Sarah Kendzior:
Coast of the Mississippi river. [laughs]
Andrea Chalupa:
Yes. So, we're just a bunch of coastal elites spouting off and being arrogant, just marinating in the jacuzzi tub of our arrogance, having this highfalutin conversation. But how does the impact of white-collar crime, what is it on the average American?
Jennifer Taub:
First of all, I was actually born in Arizona, for some reason, even though my parents were Detroiters. And by the time I was two years old had moved to Michigan. So I mean, Michigan is not on a coast. I mean, we have wonderful, great lakes. Yeah. So, I moved East to go to college and didn't end up going home.
Jennifer Taub:
Looking back on it, I should have moved home because I could have been part of a really great swing state instead of Massachusetts, which is useless when it comes to deciding elections. But yeah, how does this affect ordinary people? I think ordinary people, I guess, all of us, are impacted in ways that don't always seem visible.
Jennifer Taub:
So, one example is, when a family member is wrongly prescribed Oxycontin. It should have only been prescribed for end of life care or for things like if you have extremely painful cancer with a prognosis very short, so addiction is not as much of an issue. If you had a family member who was prescribed Oxycontin because they were having dental surgery, or had chronic back pain, and then became addicted, and then all the emotional weight and pain of that happens to you and your family and extended family, up to and including their deaths, all of that affects us. And that was white-collar crime.
Jennifer Taub:
To be clear, the Sacklers are repeat offenders and so is Purdue Pharma. They pleaded guilty back in 2007, and again now, and yet they kept going and their family benefitted literally on the deaths of—and not just their company—on the deaths of hundreds of thousands of people. Other ways we’re affected is there was a lot of fraud in every link of the toxic mortgage supply chain that brought down the economy of the world in 2008.
Jennifer Taub:
And in the U.S, millions of people lost their home to foreclosures in part because the entire housing market was inflated due to false appraisals driven by the demand to keep churning refinances and new mortgages through a pipeline that had dried up when interest rates were hyped and no one wanted to re-fi anymore.
Jennifer Taub:
There are ways in which these systems, the ways when people are trying to figure out how to profit when they do so by cutting corners or unlawfully, it really affects all of us. I mean, I could go on and on. It's not just the Ponzi schemes or cases where drugs are pushed and peddled and then there's no system to, or money in place to put people in rehab when they need to. There's so many ways.
Jennifer Taub:
And I think the biggest way that concerns me is the erosion of faith in the institutions we need. And I touched on this a bit before, but I do believe that the anti-vaxxer movement has gotten more followers and adherence because people lost trust in Big Pharma because of things like Oxycontin, because of other scandals with drugs that were either wrongly labeled or had side effects that were not disclosed.
Jennifer Taub:
And yet we need people to get childhood vaccines because the harms of things like measles and other diseases we thought we had eradicated is huge. And we can see this now with the mistrust, we're worried that people will not maybe get the COVID vaccine. And we need to get, I think what is the number? At least just 70% of the population is what I heard at one time. I might be wrong. We need to get a certain huge percentage of our population here and across the world to get vaccinated for this, and possibly not just this year but on a regular basis in order to keep us safe. And yet if you believe that all businesses are crooked because businesses are not held accountable, then we lose faith and it can cause more harm.
Sarah Kendzior:
Yeah. I agree with that. We actually, in the Gaslit Nation episode we just taped—and to clarify for our listeners, today is December 8th—we were talking about that, about the loss of faith in institutions leading to distrust in the vaccine. It's not all irrational. And what you brought up about the opioid crisis hits home particularly for me, because I live in Missouri which is one of the most hardest hit states by that crisis.
Sarah Kendzior:
And for 15 years, I've watched people go from being hooked on prescribed opioids that they had for surgeries to not being able to access them, to turning to heroin, to overdosing. And in a couple of cases, I've lost friends to this. And so, this is one of these things that really cuts across party lines. It affects absolutely everybody.
Sarah Kendzior:
And I'm in a state that, of course, is heavily GOP in terms of its legislature (not necessarily in terms of its constituency because of gerrymandering and voter suppression and so forth). Anyway, my question is why don't more politicians run on prosecuting families like the Sacklers, on enforcing accountability, changing laws to make sure that they don't get away with it when it is such a universally felt crisis and there's such a universal longing? Joe Biden talks about wanting to unify all of us. Why doesn't he unify us by getting rid of elite criminal impunity?
Jennifer Taub:
Such a good question and I'm going to dodge it for one moment to say, what about prevention? There was a moment when this could have been stopped. Why did we under-staff the FDA (the Food and Drug Administration)? Why is it that the drug enforcement agency, when they saw the problem with prescription opioid abuse, they didn't communicate with the FDA?
Jennifer Taub:
Why was this product allowed to launch—which in a few years had made billions of dollars—why was it allowed to launch without submitting marketing materials to the FDA? What's with that? So, let me answer this part before we talk about the enforcement part.
Jennifer Taub:
As Elizabeth Warren has said, personnel is policy. And as we saw with the Trump administration, when he appointed people to agencies who were there to dismantle the agency, to kill the regulatory state, to look out for the interests of the businesses they were supposed to regulate, that's how this thing gets out of control.
Jennifer Taub:
And once a product has been designed, and been marketed, and is making billions of dollars, there's a lot of money to throw around, which gets us to the real question you're asking. It was very difficult, state by state. I'm thinking of Florida as one example. One thing people wanted was databases to keep track of these pill mills. When you have a problem in a business sector with a dangerous product, it's all along the supply chain where someone's making a little bit of money.
Jennifer Taub:
And with the pill mills, it was these doctors over-prescribing something that they shouldn't have been doing. And there was resistance to getting any kind of database to try to track this stuff. And the arguments are always, you know, patient privacy. But the real thing is that everyone's spreading the money around, and that politicians are afraid that they won't get campaign contributions from individuals who either work for these kinds of businesses or own these kinds of businesses.
Jennifer Taub:
So, once something gets so out of control that it's hugely profitable, it's much harder to stop it. And then when it comes to the other side of it... I guess the Trump administration just did the criminal settlement with Purdue and it's going through this bankruptcy process (which will help it organize all these new civil cases against it), but not a single person has been charged, right? Not a single executive. They certainly haven't yet looked through to individual Sackler family member owners, even if they may have been directly involved and knowledgeable about the way their product was being pushed. Yet, we haven't heard anything about that. And they're also going to still have millions of dollars each. So, why is there no interest in doing that? I don't know. I have no idea why that's not more popular.
Jennifer Taub:
I think some people try to run on these issues, but then they're accused of being biased, right? Against people. We even hear this—and we were talking about this before the show. I know it might be a bit of a tangent—but you're even hearing people and you're seeing op-eds in newspapers by the so-called serious people saying, “we just need to move on” and that “no one in the justice department should hold anyone accountable who was part of the Trump administration, even if they committed crimes. And there shouldn't be hearings in Congress. That Joe Biden should move on and unify the country.” And that's completely the wrong thing to do.
Jennifer Taub:
Where populist anger comes from is this idea that some people can break the law and are above the law, and the rest of us are victims of that and no one cares about the rest of us. And I think it's a huge mistake to take that path. But as you see, if we're not even willing to prosecute people who weren't part of the Trump administration who may have been involved in criminal activity, then it's going to be even harder to go after former politicians when they have so many supporters.
Andrea Chalupa:
So, obviously a big, scary facet of all this is the normalization. And you see, as you mentioned, a whole political party behind a lot of this corruption, with Kelly Loeffler calling it the “American Dream” in the recent Georgia debate. And Kelly Loeffler, of course, is accused of insider trading, having dumped a bunch of stock after she received information on the COVID pandemic and how bad it was going to be. In terms of this normalization that we're up against, what are some ways that the American public is being gaslit when it comes to white-collar crime?
Jennifer Taub:
Wow. That's such a good question. When I think about gaslighting, I think about it as an information campaign to distort the way we think about things and to make people paranoid to think what you're seeing isn't happening right in front of you. And the way I see it is, I think we know enough. There was a time when I looked at Brandeis quite a bit more, in particular, his work and his comments about sunlight being the best disinfectant, electric light being a good policeman, that idea of transparency.
Jennifer Taub:
And I think transparency is necessary, but not sufficient. Most people know about white-collar crime. I don't think it's, at this point, a matter of gaslighting, I think, right now, it's purely about power. And so, I think more today about Frederick Douglas, about power never gives up anything...what is his expression? Without a demand?
Jennifer Taub:
And so, I think it's about making the demand and saying enough is enough. I think we need more people to speak up and say they want accountability. There just seems to be resistance among people in power to take on tough fights. And I think they need to. You cannot obviously prosecute every single white-collar criminal out there, but I think the idea that this pattern of entering into these deferred prosecution agreements or non-prosecution agreements with corporations and then not holding their executives accountable—not even getting them to step down from their roles often—it's ridiculous. And I think the public sees it but feels helpless. And I think my goal would be to get people riled up and angry enough to make those demands.
Andrea Chalupa:
Our discussion continues, and you can get access to that by signing up on our Patreon at the Truth Teller level or higher.
Sarah Kendzior:
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Andrea Chalupa:
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Sarah Kendzior:
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Andrea Chalupa:
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