Criminality and Bad Economics

Our current government claims to be one that is tough on crime, yet in practice it seems to being doing the opposite. What I am going to suggest that the government through its policies is reverting back towards an earlier model of society, one similar to that of the 18th century. In that century policing was massively under resourced. Crime prevention and detection was in the hands of the Parish Constable. A man who had to rely on the support of his parishioners to arrest criminals. Policing was so ineffective that the government had to resort to the extreme measure of making most offences capital offences as a means of deterring crime. The Black Act of 1723 tried to compensate for the lack of an effective police force by making some 50 offences punishable by hanging, for example the punishment for breaking a farmer’s gate was hanging.The only way the to keep one’s household safe was to ensure that all the doors where secured by good locks and a variety of loaded guns where at hand to fend off any intruders. Ominously I was told by a member of the police force that his recommendation was to secure one’s house with good locks and stay in at night, he thought the policing levels were inadequate to guarantee the public’s safety. One senior police office ventured the opinion that he would not go into the centre of Manchester at night because it was not safe.

The combination of weak governments and under resourced policing is all to evident in Eire. Even before the financial crash and the austerity programme that forced large cuts on the Garda (Eire’s police force), this force was struggling to cope with the criminal activities of both terrorist groups and criminal gangs. These gangs were then so powerful that they could shoot a campaigning journalist at a busy cross roads and get away unhindered. Now an even more depleted police force is unable to prevent tit for tat killings that are occurring between these criminal gangs. Yet in spite of the evidence of the evident dangers of relying on an under resourced and undermanned police force to contain these dangerous criminal gangs the government is insistent on following the unwise path already trodden by Eire.

There is ominous evidence from my home city that this is already happening. Cuts to the number of the police have meant the ending of an effective pro active drugs strategy. The teams that were used to break up and disrupt the drug dealing gangs have been disbanded and the remaining police officers used to street patrols. The police will now only react to evidence of drug crime and only if it is thought that the individual in question has drugs in excess of a street value of £10,000. This means that the street dealers which are the bread and butter of the organised drugs trade are given a relatively free hand.

Why despite all the evidence of the dangers of allowing the drugs gangs to flourish has the government adopted policies that will encourage these gangs to flourish.

Why?

There are several possible answers but the most likely is the change in the philosophy of the government. The adoption of the brutalist philosophy of Neo-Liberalism, which emphasised the supremacy of free market, competition and the end of regulation. Regulation it was argued did not prevent wrong doing so much as impose additional and unnecessary burdens on business. However Hayek (The Road to Serfdom) who was the founding father of Neo-Liberalism did not argue for the extreme Neo-Liberal system of today. He believed in the good society, a society in which all paid tax for finance those items that made up the common good. He never once in his writings claimed that the ideal state is one in which the tax authorities collaborated with the rich in a programme of tax avoidance. He would have been horrified at the programme of tax cuts that reduced the effectiveness of the police and other public services.

Rather than looking to Hayek it is the writings of a novelist and minor philosopher called Ayn Rand that are the inspiration for the new Neo-Liberal State. In her influential novel “Atlas Shrugged” she wrote that the billionaires are the saviours of society. It is their energy and drive that moves society forward. Any restrictions on the activities of these people negatively impact on society as it prevents them fulfilling their primary purpose which is wealth creation. Therefore in her good society there are to be few regulations imposed on the billionaires or the businesses they run. Regulations that protect workers at their place of work are no more an unnecessary increase in costs as they disproportionately increase the costs of labour far beyond the contribution labour makes to wealth creation. All these high labour costs do is reduce the number of goods and service produced as what might have been produced if labour was fairly priced is now uneconomic. Similarly high rates of taxation on the rich do little more than reduce the amount of money that they have available for investing in the economy. In contrast the poor and the great majority contribute little to the economy, they are merely the simple tools that the billionaire uses to create wealth. Only if the billionaire class is freed from all restriction will they be able to use their energies creatively to add to the wealth of society. It is this author who is the inspiration behind the new Neo-Liberal State, that is the Britain of 2016.

Although her books are widely read amongst students at our elite universities, there has to be another reason as to why she has been adopted as the political philosopher of choice by our political classes. I think part of the answer is that they identify with her billionaire class. They see themselves as much victims of society as the billionaires of Ayn Rand. These leaders are continually frustrated in their great schemes for change and reform by the opposition of the little people. People of little worth, who lacking the skills or even intelligence for government think they have to right to a say in how policy is made. This contempt for the little people is demonstrated in the distain our leaders show for them. One former leader spoke of constantly being stabbed in back by public sector workers who failed to understand that the policies he was introducing were for their benefit and the good of society. Another continually referred to his opponents as the ‘blob’, abusive terms are the common currency of politicians who want to minimise the role of the people in a democracy.

It must also be mentioned that the political classes believed that the political and economic reforms espoused by Ayn Rand would if adopted would lead to a new political and economic dynamism in what they saw as a moribund society and economy , too rooted in the practices of the past.

Rather than continue with a psychological analysis of the political classes, what I want to demonstrate is the impact of what I shall call ‘Randism’ has on society and crime in particular. If the billionaires and their proxies the great business corporations are to be freed from almost controls and regulations, there are other greater predators that will benefit, which are the organised crime networks.

Changes in the legal system, in that is company law and tax law have created a situation in which the big corporations are largely outside the law (at least in the UK). What has been created is an opaque system of company organisation the will frustrate any attempt at regulation or control. However such a system is open to abuse and it offers possibilities for criminal organisations that had not previously existed. Formerly in the UK criminal groups used small businesses as a front for their illegal activities, such as scrap metal dealing, now they have the opportunity given the opaque nature of company organisations to move into large scale legitimate business. What is to be feared that the change or weakening of company regulation could result in a similar situation to that in southern Italy where the criminal gangs have penetrated legitimate businesses.This has already happened in the meat processing trade, there was a recent scandal in Britain where it was discovered that criminal gangs had infiltrated the food processing industry and were able to pass off horse meat as beef. While a few minor wrong doers were arrested the members of major criminal gangs were never arrested. The abolition of most regulation relating to food production has not freed the large supermarkets from unnecessary regulation but opened up a new field of opportunity for organised crime.
Perhaps the fate of the National Crime Agency illustrates best the dangers of an opaque legal system. The National Crime Agency was set up to tackle organised crime or more particularly the large drug gangs. It was to be a British FBI, with some of the best detectives seconded to it. However it has been largely ineffective in its main purpose which is to seize the assets of the big criminal gangs as a means of rendering them ineffective. Its ineffectiveness is a consequence of legal changes designed to minimise the impact of regulation on the big corporations and it is this lack of legal powers to intercept the flows of cash within big business that means this agency is unable to disrupt the large organised crime enterprises. It is not only in Britain that the law enforcement agencies are unable to confiscate the income of these criminal empires but also in Eire where the crime lords can amass their ill gotten gains without any apparent interference from the legal authorities.

Governments know that the lack of effective financial regulation means that the large income flows that enable the criminal gangs to prosper. What prevents them taking effective action is the corporate interest which is opposed to any stricter regulation of international finance. They see any change as a threat to them, what they want least of all is to be liable for their fair share of taxation. They will continue to work against any effective control of financial transactions, even if it means tolerating the growth of large scale criminal empires.

The political classes in Britain with the belief in Ayn Rand’s Neo-Liberal dream would never countenance any change in law which might disadvantage the billionaires or their proxies the large business corporation. Their rigid adherence this extreme ideology or dogma means that effective action will never be taken against these criminal empires as the consequence of any such actions may have what the big corporations see as negative consequences for them.

This belief is all to clearly illustrated in the actions of the British Treasury who believe that any government spending reduces national income and so the minimum should be spent on public services such as policing. Newspaper columnists can continue to write horror stories about the iniquities of the trades trade but the Treasury would never countenance any increase in spending on the police as they believe it would negatively impact on the nations wealth. They believe that if the price of greater wealth is increased criminality, that is a price worth paying as its better to live in a dynamic high crime society than in a moribund low crime society.

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