Street Crimes and Suite Crimes

reviewed by Ben Pesta

The emergence of crime as a political issue has been a relatively recent development in American life. Slavery, free silver, single-payer health care, and almost all other political issues were genuine controversies, with proponents on both sides. But no party or constituency has ever proclaimed itself "pro-crime."

In Who Are the Criminals? John Hagan, a law professor at Northwestern University, describes two discrete historical "ages" and the political crime policies that prevailed. The "Roosevelt era" (1933-1973) was characterized by intensive regulation of business and (particularly) banking activities, a concentration on rehabilitation, and concern for the social causes of crime. It was the era of the rise of social theory, and the many competing theories of the origins of crime fell into three general categories: structural functionalism, symbolic interactionism, and conflict theory.

The "Reagan era" began in 1974, ironically well before Reagan's presidency, but the author argues that Reagan's anticrime rhetoric as California governor and presidential candidate influenced the national debate. The Reagan era, which extended to 2008 according to the author, featured harsher measures against street crime, particularly drugs, and the dramatic relaxation of regulations on business and banking. Sociologists and criminologists shifted their concerns toward the "career criminal." Harvard's James Q. Wilson described "the blank, unremorseful face of a feral, pre-social being." Reagan echoed Wilson's rhetoric and spoke of the "stark, staring face--a face that belongs to a frightening reality of our time: the face of the human predator. ..." Similarly, Princeton's John Dilulio Jr. warned of "the coming of the super-predators," and "super-predator" quickly entered the national dialogue.

Never mind that serious and violent crime actually declined between 1980 and 1985. The legacy of the Reagan administration included the Sentencing Reform Act (1984), with its mandatory minimum sentences, and the Federal Sentencing Guidelines (1987). Also, the Anti-Drug Abuse Act of 1986 established the 100:1 crack-to-powder cocaine rule: For sentencing purposes, 5 grams of crack--used primarily by African Americans--was equal to 500 grams of cocaine powder. As federal Sentencing Commission member Ilene Nagel observed, "the Sentencing Reform Act was passed, at least in part, to make patently clear the rejection of the rehabilitation model ... in favor of the new basis for sentencing--to punish, to promote respect for law, to deter, and to incapacitate."

Taking predators, super and otherwise, off the streets was one prong of Reaganism. Getting government "out of the way" was the other. "The dream of Reaganomics," the author writes, "was one in which government rules and regulations would be swept aside like unnecessary debris blocking the pathway to the nation's thwarted ambitions." So Reagan appointed deregulators and Milton Friedman disciples, most notably Alan Greenspan as chairman of the Federal Reserve, and set about dismantling legislation restricting banks and the sale of securities. Hagan makes an interesting case that the passage of the generally forgotten GarnSt. Germain Depository Institutions Act in 1982 (freeing savings and loans from the requirement that prospective home buyers present significant down payments) was the precipice of the slippery slope.

For Hagan, Reagan's "massive increase in punitive incarceration" of street criminals (facilitated by the 1984 federal Sentencing Guidelines and the 100:1 crack-to-powder ratio) eventually resulted in our overcrowded prisons, in which, by 2010, 2.4 million Americans were incarcerated. By contrast, Reagan's laissez-faire economic policies and lax regulatory oversight turned America into a virtual Spanish Main for corporate freebooters. The chapter entitled "Framing the Freeing of the Suites" is an elegant short history of the politics of deregulation and its consequences: the savings and loan failures, the Boesky-Milken scandal, the subsequent Drexel Burnham Lambert failure, the derivatives bubble, the Countrywide financial scandal and the subprime meltdown it presaged, the 2008 economic collapse, the TARP legislation, and the Goldman Sachs "backdoor bailout."

Clearly, the Reagan administration thought of "predators" as young minority males with guns, and not as directors misrepresenting the corporate balance sheet to get through the next quarter with their dividends intact. "The shining city on the hill that Reagan rhapsodized about," Hagan writes, "was a city where the streets were highly controlled and the business suites were much less constrained." It is the "shining city" in which we live today.

Ben Pesta is a white-collar and criminal defense attorney in Century City.

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