They kick in before people are hurt. They’re usually aimed at corporations, not individuals. Everyone is punished by the paperwork. The penalties come in the form of fines.
Regulation is the best protection business can have.
When regulation isn’t imposed by government, it comes in other forms. It comes in insurance requirements. It comes from the plaintiff’s bar. Fines come in the form of differing rates to protect truck fleets, different prices for handling transactions, and in jury awards.
Because of regulation, business executives have long been immune from the reach of the criminal law. They tend to act right up to the border of regulation, sometimes a little beyond, because if they don’t their competitors will, and the business can be lost.
This is another important point about regulation. It protects ethical business practices from those who lack ethics. Without ethics imposed by professional or industry groups, everyone is forced to act without ethics, because the market’s judgement is cruel and final.
Capitalism is an economic model. It is not a political model. Capitalism says nothing about the kind of government order standing above it. China is nominally communist, but it’s also utterly capitalist.
Capitalism is the law of jungle applied to business. Anything more than that must be created above it, in the form of government imposing costs and distributing wealth, or of businesses and professional societies imposing ethical rules that exile violators, or insurers imposing enormous costs on those who take too many losses.
One of the greatest idiocies of our time is how capitalism has been redefined as something political and placed against something else called socialism as a political model. It’s not comparing apples to oranges. It’s comparing apples to railroads.
Capitalists can always agree to be socialists, even communists. The National Football League takes from each team according to its ability while distributing most of the wealth equally. The teams that perform the worst wind up getting the best young athletes. Every American sports league operates in this way. Even the NCAA is, at its heart, a revenue-sharing organization. The rules are imposed to “assure competition,” but they’re really there to assure profit against the athletes and agents who always, in their capitalistic way, seek “more” from teams than they feel willing to give.
There is nothing capitalist in the American sports system. Set it against how European soccer leagues operate and you’ll see what I mean. The same teams win in Europe, year after year, because wealth there is not distributed equally. The teams with the best records in the Premier League get the most TV revenue. Only recently have some limits been placed on spending, in the form of “financial fair play” rules, which are only there to protect owners from ruinous losses.
Yet the NFL is sold to the public, year after year, as some sort of paragon of the capitalist idea. Americans have no capitalist idea. Freedom is always limited. Your right to do what you will ends at my nose, and that’s the way things should be. The Constitution presumes a system of ordered liberty. Ordered liberty.
This brings me to 2020 and what should be its defining issue, which is crime.
Trump’s election, and his policies eliminating a century of business regulation, have thrown gasoline on the fire of a business crime wave unparalleled in our history. There are no longer any rules, or so it seems. You can fire people at will, your waste can destroy their land, air and water, and everything the government touches is for sale to the highest bidder.
That’s not capitalism. That’s not even socialism. It’s kleptocracy. It’s Russia.
The answer to kleptocracy is the criminal law. If a business kills someone, because there was no regulation to protect competition from that murder, then the top executive should pay at the criminal bar. All types of financial malfeasance need to be severely punished, personally punished, with jail time, until executives learn that their jobs are responsibilities, not licenses, and that this responsibility extends beyond themselves and shareholders, to their employees, customers, and they communities they serve.
There’s a joke that “I won’t believe corporations are people until Texas executes one.” We have executed a few. The criminal activity of top executives at Enron and Arthur Andersen resulted in their assets being sold for scrap. Some of their people even went to jail. This was done during the George W. Bush Administration. It wasn’t some sort of communist plot. It was old-fashioned law enforcement.
That’s what America needs now. We need old-fashioned law enforcement.
We need a new Administration that will take on the crimes now going on in plain sight, and those going on underneath the surface, punishing the criminals with hard time. We need the equivalent of Rudy Giuliani’s “broken windows theory,” in which corporate criminals are punished severely for even small infractions, so they won’t commit them again. We need corporations to start begging for new regulations, powerful regulations, with serious enforcement, for their own protection. We need to restore our professional and business societies to their prominent places and take their rules seriously as well.
This coming election is not about capitalism or socialism. They are not in conflict. It needs to be about criminal behavior vs. honest behavior, ethical behavior vs. unethical behavior.
I’m tentatively convinced that Kamala Harris is the best possible vehicle for delivering that message. She was a local prosecutor and state Attorney General before joining the Senate. That’s the kind of background we need at the top of our government, a complete clear-out of the Augean stables, of the money-changers in the national temple.
This is a conservative message, conservative in the best sense of the word. It’s a message I also think most people will respond to instinctively, one they won’t get lost in the weeds of.
There’s a boiling anger in this country, and everyone thinks someone else is to blame.
Let the courts sort it out, while we rebuild the guardrails.
The demand for 2020 should be simple. Law and order.