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Capitalism is criminal.

Gangster Capitalism: The United States and the Global Rise of Organized Crime

By Michael Woodiwiss

Carroll and Graf, 2005

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The title of Michael Woodiwiss's book plays on the term "gangster capitalism." It asks the question: Are there gangsters who are capitalists? Yes, indeed, is Woodiwiss's answer. But it also raises the more important question: Are capitalists gangsters? His answer is a resounding affirmative.

He shows that the most spectacular forms of crime--street crime and organized crime--are only superficial aspects of the way market capitalism as a system has operated in the modern era. In this well researched work, Woodiwiss reviews the history of criminality in the United States in the twentieth century. Laissez-faire capitalism bred rampant criminality between 1900 and 1929. From top to bottom, American society was infected with criminals, ranging from bank robbers, kidnappers and murderers-for-hire to organized crime syndicates. But far worse, Woodiwiss demonstrates, were the criminal activities of big businesses and politicians under unregulated capitalism.

Murray Gurfein, a prominent lawyer of the period, wrote a definitive essay on racketeering, linking organized crime and the unsavoury characteristics of the American business system. He wrote of the "pegged market in stocks, the manipulation of subsidiary companies, the relentless puffing of securities, the taking by corporate management of inordinately large bonuses, the rather widespread evasion of taxes, the easy connivance of politicians in grabs." In view of the recent scandals around Enron, Arthur Andersen, WorldCom and others, Gurfein's remarks were prescient. He concluded: "The racketeer as a type ... is a natural evolutionary product of strict laissez faire."

A NEW DEAL FOR THE WORLD?

Under Roosevelt's New Deal, American capitalism came under some regulation. Woodiwiss shows that, likewise, business racketeering and other forms of criminality declined. Contrariwise, the recovery and then triumph of business in the second half of the twentieth century has led to a recrudescence of corporate and other forms of criminal behaviour, high and low. In the post-1945 period, politicians and media had attempted to portray the problem of crime not as the product of the market but of the Mafia, drug lords and the black under-classes, letting business off the hook.

The rest of the book focuses on criminality in the rest of the world. Less well researched and somewhat fragmented, this part of the work falters. It nonetheless does point out the power of the United States government to enforce its own view of criminality on the rest of the world. By virtue of American pressure, international criminality is seen by the United Nations and other international organizations essentially as a fight against organized crime and drug trafficking worldwide. With respect to the latter, Woodiwiss fails to note that the war against drugs, like the war on terror, is a key aspect of the U.S.'s imperialist foreign policy.

Woodiwiss believes that, in the age of globalization, international criminality can be controlled only by a global New Deal. Corporations need to be brought under democratic control as they were under Roosevelt, income needs to redistributed between rich states (and other actors) and poor ones, and a World Financial Authority should be created. Yet, it could be pointed out by neoliberals that the real remedy to criminality is greater transparency and rationality of markets, rather than their control.

The author unfortunately foregoes such theoretical considerations in favour of a strictly empirical approach. Indeed, it is a weakness of Woodiwiss's account that he takes for granted that gangster capitalism is the consequence simply of unregulated markets. In its essence, capitalism is a system that feeds on theft from and the dispossession of people, war and plunder, and the exploitation of labour to make profit. As such, it tends to degenerate into unrestrained larceny. At the same time, it will resist--and, if left intact, will defeat--efforts to merely reform it.

Review by HENRY HELLER
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Title Annotation:Gangster Capitalism: The United States and the Global Rise of Organized Crime
Author:Heller, Henry
Publication:Canadian Dimension
Article Type:Book review
Date:Jul 1, 2006
Words:639
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