Loadsa Serious Money
- Regulating the City: Competition, Scandal and Reform by Michael Clarke
Open University, 288 pp, £25.00, May 1986, ISBN 0 335 15381 X
- Regulating fraud: White-Collar Crime and the Criminal Process by Michael Levi
Tavistock, 416 pp, £35.00, August 1987, ISBN 0 422 61160 3
By no means the least significant consequence of the Conservatives’ adoption of an ‘authoritarian populist’ platform on law and order during the Election of 1979 was the pressure this put on the British Left to develop its own practical and ‘realistic’ policies with regard to the containment of crime. The only really interesting new development within British criminology during the Eighties (other than the resurrection of the idea of the ‘reasoning criminal’) has been the emergence of ‘left realist criminology’, with its insistence on the seriousness of street crime.
Closely paralleling this development has been a transformation of the public stance of the Labour Party on questions of crime and penal policy. This transformation is quite clearly revealed by comparing the essentially sceptical and libertarian concerns of the briefing pamphlet on ‘Law, Order and Human Rights’ which was circulated to all the Party’s candidates in 1979 with the heavy emphasis placed on crime prevention in the pamphlet on ‘Protecting our People’ released at the time of the 1987 Election, In this pamphlet, nearly all the concerns of realist criminology find a place: the focus of discussion is almost entirely on street crime. The substance of the policy proposals centres on the creation of crime prevention schemes at the neighbourhood level and on the re-constitution of the Police as a public service preoccupied with the prevention and prosecution of crimes committed against ‘ordinary people’.
In 1988, the continuing increase in the rates of crimes of violence and hooliganism, together with the Hungerford episode, makes the emptiness of the Thatcherites’ early insistence on the effectiveness of penal coercion (‘the Barrier of Steel’ of which Mrs. Thatcher spoke in an infamous speech of May 1979) look obvious enough. But the narrow – ‘realistic’ – focus on street crime adopted by ‘left realist’ criminologists – who are in other ways quite critical of Thatcherism – has now encountered some problems. One of these has been the publicity given to corruption in the City and in the international stockmarkets. Press reports of June 1986 about cases of insider-trading in the United States, and the extraordinary sums of money involved, were quickly followed by the prosecution in Britain of Michael Collier. Chairman of Morgan Grenfell, the largest securities firm in the City of London, for making an instantaneous profit of £15,000 on the purchase of shares in a company he knew was about to be taken over. A steady series of cases involving manipulation of the market followed throughout 1987 (including the prosecution of a Tory MP, Keith Best), and by the end of the year, there was a perceptible suspicion abroad (certainly in the mass media) that these cases represented merely the tip of a very large iceberg.
Once again, the attempt to construct a ‘popular capitalism’ in Britain was encountering the problem of moral default on the part of individual capitalists (the ‘unacceptable face’ of capitalism), and once again, criminologists were being asked questions about ‘the criminality of the powerful’. Left realists, however, concerned to develop a popular socialist programme of crime prevention and democratic policing, have found themselves with little to say about crime in the City. There is, indeed, a temptation to ignore these recent revelations on the grounds that they have no direct physical or psychological impact on working people, on the unemployed or on other disadvantaged populations. But there is clearly some anxiety amongst left realists about this position: isn’t the emergence of new evidence about fraud and corruption amongst the powerful an important measure of the moral problems inherent in free-market capitalism? Isn’t the treatment of fraud and corruption by the courts an important issue in and of itself, highlighting the broader and very powerful ideological question of substantive equality before the law?
There is a long tradition of interest on the part of socialist criminologists in the criminality of the powerful. ‘White-collar crime’ and ‘economic crime’ were central topics in the work of the great Marxist criminologist Willem Bonger, whose Criminality and Economic Conditions was published in 1916. ‘White-collar crime’ was also an interest of the American sociologist Edwin Sutherland, whose main work on this subject was published in 1949. In this country, however, dominated as its criminology has been by technical and administrative concerns, the interest of scholars has been periodic and largely indecisive. The only period in which any serious work on the criminality of the powerful (or on the regulation of financial markets in the public interest) has been published was the so-called period of Social Reconstruction in the aftermath of the Second World War. The whole of the second half of Hermann Mannheim’s underrated Criminal Justice and Social Reconstruction (1946) is taken up with an examination of the ways and means of shifting the main emphasis of English criminal law and of standard forms of policing, from ‘comparatively petty economic crime to the various, more complicated and more dangerous types of white-collar crime’. According to Mannheim, a typically social democratic radical of the period, the issues involved were the moral legitimacy and the efficacy of the legal and penal systems as such.
The long silence of socialist criminology since the late Forties on the criminality of the powerful has been broken only by a monograph by Frank Pearce on American corporations and anti-monopoly legislation, a rather inconclusive review of the literature on ‘white-collar crime’ by the late John Spencer, and an important critical essay by Paul Hirst on the inability of orthodox Marxism to theorise the joint-stock company. None of these interventions did much to ground their discussion in the developing realities of economic crime in Britain. This particular project was only taken up with any seriousness in the early Eighties, with three studies by two men, Michael Clarke and Michael Levi. Both Clarke and Levi have now re-entered the fray in order to examine the pressing question of fraud in the City and other financial markets.
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 The attention of the British and international press was first alerted to the question of insider trading in the new free-market conditions by the prosecution in the United States of Dennis Levine (June 1986), who was said to have amassed a profit of $12.6 million on an insider-trade. This was followed by the news that a dealer in Wall Street securities, Ivan Boesky, had just agreed to repay $50 million to the US Securities and Exchange Commission, to ensure that he would not be liable for damages in a suit the SRC was bringing against him.
 See Michael Clarke’s Fallen Idols: Elites and the Search for an Acceptable Face of Capitalism (Junction Books, 1981) and Corruption (Frances Pinter, 1983); and Michael Levi’ The Phantom Capitalists: The Organisation and Control of Long-Term Fraud (Aldershot: Gower Press, 1981).
 See Pete Davies’s The Last Election (1987) and Dick Morland’s Albion! Albion! (1974).