Multinational Monitor

MAY/JUN 2007
VOL 28 No. 3


The Billionaire Loophole: The Private Equity Tax Escape
by Samuel Bollier

Financial Entanglement and Developing Countries
by C.P. Chandrasekhar

Sin and Society: Part 1
by Edward Alsworth Ross


The Predators' Ball Resumes: Financial Mania and Systemic Risk
an interview with Damon Silvers

The Foreclosure Epidemic: The Cost to Families and Communities of the Predictable Mortgage Meldown
an interview with Alan Fishbein


Behind the Lines

Deregulation and the Financial Crisis

The Front
White Collar Drug Pushers - Snake Eyes for the U.S. at WTO - Taming the Giant Corporation

The Lawrence Summers Memorial Award

Greed At a Glance

Commercial Alert

Names In the News


Sin and Society

(Part I of a Three-Part Series)

by Edward Alsworth Ross

Editor's Note: 2007 marks the 100-year anniversary of the publication of a remarkable book-length essay, Sin and Society; An Analysis of Latter-Day Iniquity, by the sociologist Edward Alsworth Ross. Ross was the leading sociologist of the early 20th century United States, but Sin and Society was written for a lay audience.

The book is noteworthy for identifying the ways in which the industrial economy had transformed the capacity to do harm to others. The leaders of large corporations gained the power to injure and cheat people on a scale that the most heinous street criminal could not begin to match. But conventional morality had not adjusted to these changed circumstances - while the rightful disapprobation was directed at street criminals, the newly emerging class of corporate criminals and wrongdoers managed to brand themselves as respectable leaders of society.

This situation, of course, continues today - making Ross's insights all the more worth revisiting. Multinational Monitor is therefore commemorating the hundredth anniversary of Sin and Society by serializing major excerpts from the essay. Below follows the first of three parts.

Chapter 1: New Varieties of Sin

The sinful heart is ever the same, but sin changes its quality as society develops. Modern sin takes its character from the mutualism of our time. Under our present manner of living, how many of my vital interests I must intrust to others! Nowadays the water main is my well, the trolley car my carriage, the banker's safe my old stocking, the policeman's billy my fist. My own eyes and nose and judgment defer to the inspector of food, or drugs, or gas, or factories, or tenements, or insurance companies. I rely upon others to look after my drains, invest my savings, nurse my sick, and teach my children. I let the meat trust butcher my pig, the oil trust mould my candles, the sugar trust boil my sorghum, the coal trust chop my wood, the barb wire company split my rails.

But this spread-out manner of life lays snares for the weak and opens doors to the wicked. Interdependence puts us, as it were, at one another's mercy, and so ushers in a multitude of new forms of wrongdoing. The practice of mutualism has always worked this way. Most sin is preying, and every new social relation begets its cannibalism. No one will "make the ephah small" or "falsify the balances" until there is buying and selling, "withhold the pledge" until there is loaning, "keep back the hire of the laborers" until there is a wage system, "justify the wicked for a reward" until men submit their disputes to a judge. The rise of the state makes possible counterfeiting, smuggling, peculation and treason. Commerce tempts the pirate, the forger and the embezzler. Every new fiduciary relation is a fresh opportunity for breach of trust. Today the factory system makes it possible to work children to death on the double-quick, speculative building gives the ferry-builder his chance, long-range investment spawns the get-rich-quick concern, and the trust movement opens the door to the bubble promoter.

The springs of the older sin seem to be drying up. Our forced-draught pace relieves us of the superabundance of energy that demands an explosive outlet. Spasms of violent feeling go with a sluggish habit of life, and are as out of place today as are the hard-drinking habits of our Saxon ancestors. We are too busy to give rein to spite. The stresses and lures of civilized life leave slender margin for the gratification of animosities. In quiet, side-tracked communities there is still much old-fashioned hatred, leading to personal clash, but elsewhere the cherishing of malice is felt to be an expensive luxury. Moreover, brutality, lust and cruelty are on the wane. In this country, it is true, statistics show a widening torrent of bloody crime, but the cause is the weakening of law rather than an excess of bile. Other civilized peoples seem to be turning away from the sins of passion.

The darling sins that are blackening the face of our time are incidental to the ruthless pursuit of private ends, and hence quite "without prejudice." The victims are used or sacrificed not at all from personal ill-will, but because they can serve as pawns in somebody's little game. Like the wayfarers run down by the automobilist, they are offered up to the God of Speed. The essence of the wrongs that infest our articulated society is betrayal rather than aggression. Having perforce to build men of willow into a social fabric that calls for oak, we see on all hands monstrous treacheries - adulterators, peculators, boodlers, grafters, violating the trust others have placed in them. The little finger of Chicane has come to be thicker than the loins of Violence.

The sinister opportunities presented in this webbed social life have been seized unhesitatingly, because such treasons have not yet become infamous. The man who picks pockets with a railway rebate, murders with an adulterant instead of a bludgeon, burglarizes with a "rake-off" instead of a jimmy, cheats with a company prospectus instead of a deck of cards, or scuttles his town instead of his ship, does not feel on his brow the brand of a malefactor. The shedder of blood, the oppressor of the widow and the fatherless, long ago became odious, but latter-day treacheries fly no skull-and-crossbones flag at the masthead. The qualities which differentiate them from primitive sin and procure them such indulgence may be clearly defined. …

Modern Sin Lacks the Familiar Tokens of Guilt

The stealings and slayings that lurk in the complexities of our social relations are not deeds of the dive, the dark alley, the lonely road and the midnight hour. They require no nocturnal prowling with muffled step and bated breath, no weapon or offer of violence. Unlike the old-time villain, the latter-day malefactor does not wear a slouch hat and a comforter, breathe forth curses and an odor of gin, go about his nefarious work with clenched teeth and an evil scowl. In the supreme moment his lineaments are not distorted with rage, or lust, or malevolence. One misses the dramatic setting, the time-honored insignia of turpitude. Fagin and Bill Sykes and Simon Legree are vanishing types. Gamester, murderer, body-snatcher and kidnapper may appeal to a Hogarth, but what challenge finds his pencil in the countenance of the boodler, the savings-bank wrecker or the ballot-box stuffer? Among our criminals of greed, one begins to meet the "grand style" of the great criminals of ambition, Macbeth or Richard III. The modern high-power dealer of woe wears immaculate linen, carries a silk hat and a lighted cigar, sins with a calm countenance and a serene soul, leagues or months from the evil he causes. Upon his gentlemanly presence the eventual blood and tears do not obtrude themselves.

This is why good, kindly men let the wheels of commerce and of industry redden and redden, rather than pare or lose their dividend. This is why our railroads yearly injure one employee in twenty-six, and we look in vain for that promised "day of the Lord" that "will make a man more precious than fine gold."

Modern Sins Are Impersonal

The covenant breaker, the suborned witness, the corrupt judge, the oppressor of the fatherless - the old-fashioned sinner, in short - knows his victim, must hearken, perhaps, to bitter upbraidings. But the tropical belt of sin we are sweeping into is largely impersonal. Our iniquity is wireless, and we know not whose withers are wrung by it. The hurt passes into that vague mass, the "public," and is there lost to view. Hence it does not take a Borgia to knead "chalk and alum and plaster" into the loaf, seeing one cannot know just who will eat that loaf, or what gripe it will give him. The purveyor of spurious life-preservers need not be a Cain. The owner of rotten tenement houses, whose "pull" enables him to ignore the orders of the health department, foredooms babies, it is true, but for all that he is no Herod.

Often there are no victims. If the crazy hulk sent out for "just one more trip" meets with fair weather, all is well. If no fire breaks out in the theatre, the sham "emergency exits" are blameless. The corrupt inspector who O.K.'s low-grade kerosene is chancing it, that is all. Many sins, in fact, simply augment risk. Evil does not dog their footsteps with relentless and heart-shaking certainty. When the catastrophe does come, the sinner salves his conscience by blasphemously calling it an "accident" or an "act of God."

Still more impersonal is sin when the immediate harm touches beneficent institutions rather than individuals, when, following his vein of private profit, the sinner drives a gallery under some pillar upholding our civilization. The blackguarding editor is really undermining the freedom of the press. The policy kings and saloon keepers, who get out to the polls the last vote of the vicious and criminal classes, are sapping manhood suffrage. Striking engineers who spitefully desert passenger trains in mid-career are jeopardizing the right of a man to work only when he pleases. The real victim of a lynching mob is not the malefactor, but the lawabiding spirit. School-board grafters who blackmail applicants for a teacher's position are stabbing the free public school. The corrupt bosses and "combines" are murdering representative government. The perpetrators of election frauds unwittingly assail the institution of the ballot. Rarely, however, are such transgressions abominated as are offenses against persons.

Because of the special qualities of the Newer Unrighteousness, because these devastating latter-day wrongs, being comely of look, do not advertise their vileness, and are without the ulcerous hag-visage of the primitive sins, it is possible for iniquity to flourish greatly, even while men are getting better. Briber and boodler and grafter are often "good men," judged by the old tests, and would have passed for virtuous in the American community of 70 years ago. Among the chiefest sinners are now enrolled men who are pure and kindhearted, loving in their families, faithful to their friends and generous to the needy.

One might suppose that an exasperated public would sternly castigate these modern sins. But the fact is, the very qualities that lull the conscience of the sinner blind the eyes of the onlookers. People are sentimental, and bastinado wrong-doing not according to its harmfulness, but according to the infamy that has come to attach to it. Undiscerning, they chastise with scorpions the old authentic sins, but spare the new. They do not see that boodling is treason, that blackmail is piracy, that embezzlement is theft, that speculation is gambling, that tax-dodging is larceny, that railroad discrimination is treachery, that the factory labor of children is slavery, that deleterious adulteration is murder. It has not come home to them that the fraudulent promoter "devours widows' houses," that the monopolist "grinds the faces of the poor," that mercenary editors and spellbinders "put bitter for sweet and sweet for bitter." The cloven hoof hides in patent leather; and today, as in Hosea's time, the people "are destroyed for lack of knowledge." The mob lynches the red-handed slayer, when it ought to keep a gallows Haman-high for the venal mine inspector, the seller of infected milk, the maintainer of a fire-trap theatre. The child-beater is forever blasted in reputation, but the exploiter of infant toil, or the concocter of a soothing syrup for the drugging of babies, stands a pillar of society. The petty shoplifter is more abhorred than the stealer of a franchise, and the wife-whipper is outcast long before the man who sends his over-insured ship to founder with its crew.

There is a special cause for the condoning of sins committed in the way of business and without personal malice. Business men, as a rule, insist upon a free hand in their dealings, and, since they are conspicuous and influential in the community, they carry with them a considerable part of the non-business world. The leisured, the non-industrial employees, the bulk of professional men, and many public servants, hold to the unmitigated maxim of caveat emptor, and accept the chicane of trade as reasonable and legitimate. In England till 1487 any one who knew how to read might commit murder with impunity by claiming "benefit of clergy." There is something like this in the way we have granted quack and fakir and mine operator and railroad company indulgence to commit manslaughter in the name of business. …

Still, even if the mass turns vehement, it is not certain the lash of its censure can reach the cuticle of the sinner. A differentiated society abounds in closed doors and curtained recesses. The murmurs of the alley do not penetrate to the boulevard. The shrieks from the blazing excursion steamer do not invade the distant yacht of her owners. If the curses of tricked depositors never rise to the circles of "high finance" that keep the conscience of the savings-bank wrecker, why should the popular hiss stay the commercial buccaneer? All turns on the power of the greater public to astringe the flaccid conscience of business men until they become stern judges of one another. If we have really entered upon the era of jangling classes, it is, of course, idle to hope for a truly public sentiment upon such matters. Nevertheless, in the past, antiseptic currents of opinion have mounted from the healthy base to the yellowing top of the social tree, and they may do so again.

While idealists are dipping their brushes into the sunset for colors bright enough to paint the Utopias that might be if society were quite made over, one may be pardoned for dreaming of what would be possible, even on the plane of existing institutions, if only in this highly articulated society of ours every one were required to act in good faith, and to do what he had deliberately led others to expect of him. …

Chapter 3: The Criminaloid

The immunity enjoyed by the perpetrator of new sins has brought into being a class for which we may coin the term criminaloid. By this we designate such as prosper by flagitious practices which have not yet come under the effective ban of public opinion. Often, indeed, they are guilty in the eyes of the law; but since they are not culpable in the eyes of the public and in their own eyes, their spiritual attitude is not that of the criminal. The lawmaker may make their misdeeds crimes, but, so long as morality stands stock-still in the old tracks, they escape both punishment and ignominy. Unlike their lowbrowed cousins, they occupy the cabin rather than the steerage of society. Relentless pursuit hems in the criminals, narrows their range of success, denies them influence. The criminaloids, on the other hand, encounter but feeble opposition, and, since their practices are often more lucrative than the authentic crimes, they distance their more scrupulous rivals in business and politics and reap an uncommon worldly prosperity.

Of greater moment is the fact that the criminaloids lower the tone of the community. The criminal slinks in the shadow, menacing our purses but not our ideals; the criminaloid, however, does not belong to the half world. Fortified by his connections with "legitimate business," "the regular party organization," perhaps with orthodoxy and the bon ton, he may even bestride his community like a Colossus. In his sight and in their own right the old-style, square-dealing sort are as grasshoppers. Do we not hail him as "a man who does things," make him director of our banks and railroads, trustee of our hospitals and libraries? When Prince Henry visits us, do we not put him on the reception committee? He has far more initial weight in the community than has the clergyman, editor or prosecutor who arraigns him. From his example and his excuses spreads an influence that tarnishes the ideals of ingenuous youth on the threshold of active life. To put the soul of this pagan through a Bertillon system and set forth its marks of easy identification is, therefore, a sanitary measure demanded in the interest of public health.

The Key to the Criminaloid Is Not Evil Impulse But Moral Insensibility

The director who speculates in the securities of his corporation, the banker who lends his depositors' money to himself under diverse corporate aliases, the railroad official who grants a secret rebate for his private graft, the builder who hires walking delegates to harass his rivals with causeless strikes, the labor leader who instigates a strike in order to be paid for calling it off, the publisher who bribes his text-books into the schools, these reveal in their faces nothing of wolf or vulture. Nature has not foredoomed them to evil by a double dose of lust, cruelty, malice, greed or jealousy.

They are not degenerates tormented by monstrous cravings. They want nothing more than we all want - money, power, consideration - in a word, success; but they are in a hurry and they are not particular as to the means.

The criminaloid prefers to prey on the anonymous public. He is touchy about the individual victim, and, if faced down, will even make him reparation out of the plunder gathered at longer range. Too squeamish and too prudent to practice treachery, brutality and violence himself, he takes care to work through middlemen. Conscious of the antipodal difference between doing wrong and getting it done, he places out his dirty work. With a string of intermediaries between himself and the toughs who slug voters at the polls, or the gang of navvies who break other navvies' heads with shovels on behalf of his electric line, he is able to keep his hands sweet and his boots clean. Thus he becomes a consumer of custom-made crime, a client of criminals, oftener a maker of criminals by persuading or requiring his subordinates to break law. Of course he must have "responsible" agents as valves to check the return flow of guilt from such proceedings. He shows them the goal, provides the money, insists on "results," but vehemently declines to know the foul methods by which alone his understrappers can get these "results." Not to bribe, but to employ and finance the briber; not to lie, but to admit to your editorial columns "paying matter;" not to commit perjury, but to hire men to homestead and make over to you claims they have sworn were entered in good faith and without collusion; not to cheat, but to promise a "rake-off" to a mysterious go-between in case your just assessment is cut down; not to rob on the highway, but to make the carrier pay you a rebate on your rival's shipments; not to shed innocent blood, but to bribe inspectors to overlook your neglect to install safety appliances: such are the ways of the criminaloid. He is a buyer rather than a practitioner of sin, and his middlemen spare him unpleasant details.

Secure in his quilted armor of lawyerspun sophistries, the criminaloid promulgates an ethics which the public hails as a disinterested contribution to the philosophy of conduct. He invokes a pseudo-Darwinism to sanction the revival of outlawed and by-gone tactics of struggle. Ideals of fellowship and peace are "unscientific." To win the game with the aid of a sleeveful of aces proves one's fitness to survive. A sack of spoil is Nature's patent of nobility. A fortune is a personal attribute, as truly creditable as a straight back or a symmetrical face. Poverty, like the misshapen ear of the degenerate, proves inferiority. The wholesale fleecer of trusting, workaday people is a "Napoleon," a "superman." Labor defending its daily bread must, of course, obey the law; but "business," especially the "big proposition," may free itself of such trammels in the name of a "higher law." The censurers of the criminaloid are "pin-headed disturbers" who would imitate him if they had the chance or the brains.

The Criminaloid Is Not Anti-Social by Nature

Nation-wide is the zone of devastation of the adulterator, the rebater, the commercial free-booter, the fraud promoter, the humbug healer, the law-defying monopolist. State-wide is the burnt district of the corrupt legislator, the corporation-owned judge, the venal inspector, the bought bank examiner, the mercenary editor. But draw near the sinner and he whitens. If his fellow men are wronged clear to his doorstep he is criminal, not criminaloid. For the latter loses his sinister look, even takes on a benign aspect, as you come close. Within his home town, his ward, his circle, he is perhaps a good man, if judged by the simple old-time tests. Very likely he keeps his marriage vows, pays his debts, "mixes" well, stands by his friends and has a contracted kind of public spirit. He is ready enough to rescue imperiled babies, protect maidens or help poor widows. He is unevenly moral: oak in the family and clan virtues, but basswood in commercial and civic ethics. In some relations he is more sympathetic and generous than his critics; and he resents with genuine feeling the scorn of men who happen to have specialized in other virtues than those that appeal to him. Perhaps his point of honor is to give bribes but not to take them; perhaps it is to "stay bought" or not to sell out to both sides at once. …

Sometimes it is time instead of space that divides him from his victims. It is tomorrow's morrow that will suffer from the patent soothing-syrup, the factory toil of infants, the grabbing of public lands, the butchery of forests and the smuggling in of coolies. In such a case the short-sighted many exonerate him; only the far-sighted few mark him for what he is. Or it may be a social interval that leaves him his illusion of innocence. Like Robin Hood, the criminaloid spares his own sort and finds his quarry on another social plane. The labor grafter, the political "striker" and the blackmailing society editor prey upward; the franchise grabber, the fiduciary thief and the frenzied financier prey downward. In either case the sinner moves in an atmosphere of friendly approval and can still any smart of conscience with the balm of good fellowship and adulation.

To be continued in the next issue of Multinational Monitor.

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