Over the years, I've often heard the argument that all too many laws are biased against the poor or the disadvantaged. One particular example that was cited for years was that in many jurisdictions, the penalties for possessing "crack" cocaine were far stiffer than for possessing exactly the same amount of powdered cocaine, and because crack was more prevalent in poorer neighborhoods, the law was more lenient in dealing with wealthier addicts. Another example is that often criminals who commit what amount to small scale robberies with weapons face far, far greater sentences than do "white collar" criminals who embezzle or misdirect far, far greater sums. In fact, from what I've seen, this differential goes much farther than that and generally seems based on the idea that threatening someone with a weapon or violence outweighs all other factors.

I'm not suggesting greater leniency for criminals who try to get their way with weapons or force. Far from it. What I am going to suggest, however, is that, as a society, we've bought into the idea that a crime that does not involve violence is somehow less of a crime... or that an act that "legally" deprives others of their money, houses, or other goods, even when the victims are not culpable, is not a crime at all.

Currently, we're in a financial crisis that has effectively reduced the collective wealth of the United States by something like forty percent. Certainly, my retirement funds, parked in a solid and stable and conservative set of mutual funds, are down somewhere in that neighborhood, and I've heard of others losing even more. I didn't gamble with the money. I didn't follow hot-shot brokers and tips. But like hundreds of millions of Americans, I had that money taken, in effect, stolen because a group of hot-shot money managers came up with ways to leverage financial assets, in some cases as high as 130 to one, in order to boost their corporate profits and to "earn" extraordinary bonuses.

Now... if you asked any one of them what would happen if ten percent of these assets went bad, at least some of them could have predicted what would happen. That's knowledgeable neglect. Most didn't understand at all. They just went along. That's negligence.

The basis behind criminal law, in an overall sense, is to deter crime and harm to the individual and to punish those who create such harm. We tend to classify such crimes on the severity of the harm and on the intent of the perpetrator, with an offense such as premeditated murder being one of the more severe, because the perpetrator knew he or she was going to commit the offense of taking another life. Assault generally merits less punishment... and so on. But some acts, even when "accidental," also merit punishment, such as involuntary manslaughter or accidental vehicular manslaughter.

Now... let us say that an individual has diligently saved five percent of his or her earnings for thirty or forty years, a sum amounting to years of work... and through either premeditation or negligence someone takes it away. If that someone is a thief or an embezzler, the act comes under criminal law. If that someone is a corporate CEO who agrees to massive trades in credit-default swaps and derivatives, then he can just claim he made a mistake... and most won't even do that, even in front of a Congressional hearing.

Right now, a broker, a brokerage firm, an investment banker, and many other individuals can take actions that lead to financial devastation for millions of others -- and walk away, essentially unscathed, saying, "It was just the market." Or "we did the best we could." And all too many of them take enormous bonuses when they leave. We tend not to let careless drivers, doctors, or lawyers get away with such excuses when they've committed malpractice. Exactly how did we set up a structure where those individuals who manage our savings and our retirement have no liability and accountability for incredibly poor judgment or out-and-out negligence?

Perhaps to take care of the worst abuses, we ought to enact legislation that creates criminal punishments for "involuntary theft" or "fiduciary negligence," in cases where the actions of an individual, regardless of his corporate standing, lead directly to the loss of significant sums of money on the part of large numbers of individuals. Perhaps then, if they faced the possibility of long prison terms, some of these financial types wouldn't be quite so quick to adopt and endorse leverage schemes they don't understand.

I know... any such suggestion will have the financial gurus claiming that such laws and regulations will destroy the world financial structures. So... for all those of you who don't like my thoughts and suggestions, what exactly would you suggest to create greater accountability and responsibility? And... please, please... don't cite Adam Smith and the invisible hand or the pure and free market. History has proved, time and time again, that, while such a free market might work if men and women were angels, history has also demonstrated that people aren't anywhere close to that honest and altruistic where money is concerned, especially other people's money.

—L.E. Modesitt, Jr.:  10/28/2008 09:51:00 AM