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Income Inequality Breaks Down Rule of Law

One of the central characteristics of highly unequal societies is that two sets of laws develop: One set for the rich and powerful and one set for everyone else. The more unequal societies become, the more easily they accept the unacceptable, and with each unrebuked violation, the powerful actors at the top of the society gain an ever greater sense of entitlement and an ever greater sense that the laws that govern everyone else don’t apply to them. As a result, their behavior becomes increasingly egregious.

I would suggest that the robo-mortgage scandal is a strong indicator that this type of unequal justice is now becoming ever more commonplace in America. Past bank abuses are typically discussed without a sense of outrage. They have, in effect, become a recognized practice of deception with no consequences. Here are three prominent examples from the past few years:

First, the robo-mortgage scandal was discovered. As powerful members of society, the banks effectively decided what laws they wanted to follow and disregarded others. The banks claimed that their violations were technical and harmed no one. Nonetheless, the activities of the banks constituted massive fraud, perjury, and conspiracy. Bank officials have testified in court that they filed as many as 10,000 false affidavits a month. These are effectively undeniable admissions of law-breaking on a massive scale.

It’s a federal crime, punishable by up of five years of imprisonment, to knowingly file a false affidavit with the court. From the perspective of the law, you are guilty of the same perjury when you falsely testify in court or when you submit a false affidavit. In most states, filing false affidavits with the court similarly constitutes a felony offense of perjury.

If an individual citizen perpetrated this kind of massive perjury, he or she would be prosecuted. For illegal activities to take place on this type of massive scale, other serious crimes, such as conspiracy, are undoubtedly committed as well.

The banks committed very clear, easily provable crimes by transferring property titles that they didn’t own- stealing from homeowners, and lying to the court about it.  The only consequence they face for these crimes is the “settlement” that affords for less than a $2,000 per loan file fine- not bad for a felony offense that can normally result in five years in prison.

That’s assuming that the banks even comply with that much. Gretchen Morgenson at the New York Times details how Banks often simply forgo their end of settlements:

[T]wo years of statistics, through last September, show 5,771 cases where mediators found that banks had failed to participate in good faith or were not complying with other aspects of the mediation law. That is equivalent to 42 percent of all the mediations completed in the [Foreclosure Mediation Program in Nevada].

This is in addition to other bank fraud settlements in Nevada that Bank of America violated with what appears to be complete impunity. We have two sets of rules now; one of the wealthy and one for the rest of us.

Filed under income inequality wealth inequality rule of law

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    Because here in America, it’s acceptable for the rich to steal people’s homes and “commit massive fraud, perjury, and...
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    thanks to jon’s blog post, which i found very interesting, and which is linked above. the original - as excerpted by jon...
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