Green Crimes and Dirty Money

Toine Spapens, Rob White, Daan van Uhm, Wim Huisman, Toine Spapens, Rob White, Daan van Uhm, Wim Huisman

• Éditeur: Routledge
• Année: 2018
• ISBN:
  9781351245722
• Édition: 1
• Sujet: Business
• Sous-sujet: Etica aziendale

Environmental crimes are primarily driven by financial motives. The combined financial value of illicit trade in protected wildlife, illegal logging and waste trafficking is estimated to come directly after counterfeiting, the narcotic drugs trade and illegal gambling. Logically, the proceeds of these crimes must also be laundered. Goods, however, are not the only money maker for environmental criminals. Corporations may also try to 'save' costs by not complying with environmental regulations and thus commit crimes of omission rather than commission. From an enforcement and compliance perspective focusing on the proceeds of crime may therefore be an effective strategy.

This book brings together different perspectives on the financial aspects of environmental crime and harm from a green criminological viewpoint. It addresses the role of economic systems, the value of environmental performance for corporations, money laundering in the context of environmental crime, financial investigation and questions of regulation and penalties.

Discussing these topics from the view of green criminology, sociology and governance, this book will be of great interest to all those concerned about the financial dimensions of crime and the environment.

Part I
Systemic drivers of green crimes

1 Destruction and the philosophy of desires

Vincenzo Ruggiero

Looking at green criminology from the perspective of neoliberal economics can add some elements to this growing area of enquiry (for a definition of neoliberalism, see Harvey 2005). Complementing economic reasoning with references to what I describe as the philosophy of desire can compound arguments against environmental destruction. This chapter attempts both enterprises.

The abysmal science

We spend money we don’t have, on things we don’t need, to make impressions that don’t last, on people who don’t care. Because we do not pursue what is necessary, but what is superfluous, neoliberal economic thought needs to turn the superfluous into a natural product of human activity or even into an element of human organic reproduction. Hence its need to imitate the natural sciences. Biologists, physicists, mathematicians and other scientists have been called upon to make economic theories more ‘realistic and effective’, namely to inoculate doses of dogma into them. The major opus of economics produced in the twentieth century, the General Theory of Keynes (1973 [1936]), out of a total 400 pages included, mainly in the appendix, three or four simple equations. In 1950 only in 2–3 per cent of the articles published by the influential American Economic Review contained mathematic formulas, which normally were not at all sophisticated. In 1980 the papers with mathematical calculations were 44 per cent and formulas had become much more complex. Currently the percentage is close to 90 per cent. The only ‘real’ science within the human sciences, this increasingly esoteric discipline, in its neoliberal version, dominates in university courses, in the specialist literature, and in most schools of management and business. It is the core religion of business administrators, large enterprises, financial institutions, ministries of the economy, central banks, international organisations, the World Bank, the World Monetary Fund and the European Commission.

The economy is seen as a physical system, implying flows of goods, information and energy, so that it might be useful to model the economy as a system, like physics does. However, while economic theory uses the concept of equilibrium, the same concept used by physics cannot be applied to the economy, because this is an open system and equilibrium refers to closed systems.

(Gallino 2011, p. 92)

Neo-liberalism does not observe and describe the economic reality; it creates this reality (Ruggiero 2013). It also contradicts one of the very axioms of free markets, namely that the full costs of a transaction must be borne by the involved parties. Many economic activities and transactions, however, exact a significant price on humans and ecosystems, although economists label such price with the reassuring euphemism ‘externalities’. In brief, neo-liberalism regards environmental harm as an accidental, unintentional, externality.

Applying the meum-tuum distinction suggested by Hayek (1973), we can formulate the following question: Is the environment a public good? The answer is ‘Yes’, if we, in abstract terms, assimilate it to other non-rival, non-excludable goods, in the sense that one person’s enjoyment of the environment does not exclude its enjoyment by others, and in the sense that the good environment is provided to one and all at the same time. However, the answer is ‘No’ if we believe that goods and resources belong to those who turn them into wealth. Neoliberalism embraces the latter assumption, thus reiterating early liberalist notions according to which the earth has to be turned into property through manipulation, improvement and work. By leaving fruits to rot and venison to putrefy, and for that matter by leaving the earth untouched, we offend the common law of nature (Ruggiero 2013). With neoliberalism, the entire world is given to those who are more capable of exploiting it, and the environment, therefore, is both meum and tuum, provided we both know how to extract value out of it. The boundaries, in this case, are not determined by the identification of objects upon which the different individuals exercise control, but merely by their capacity and ingenuity, which constitute the only limit to initiative and development. The ultimate resource, in brief, is the human mind, and throughout history human genius always wins out against natural resource restraints.

The harm caused by economic initiative, therefore, amounts to ‘externality’. This includes climate change, disposal of toxic waste, de-forestation, pollution of sea, air and land, gigantic disparities in income, transference of toxicity to poor regions and countries, impoverishment of vulnerable populations and destruction of communities (White 2010; South and Brisman 2013). These ‘ecocidal’ tendencies (South 2010) implicit in unfettered development are masked in a process whereby the specific victims of development itself disappear. Ideological strategies preside over this disappearance, among which a hierarchical positioning of populations and individuals is of crucial importance. Ontological priorities are established so that some lives are deemed less valuable than others: in fact, some lives are never lived nor lost in the full sense. There are lives worth living and lives worth destroying, the former being valuable and grievable, the latter devalued and ungrievable (Butler 2009). Utilitarian reasoning does not object to such distinction, as the suffering of some does not diminish the total happiness generated by the economy. This distinction, in other words, implies the neglect of individual wellbeing and happiness, while the ranking of social goodness and the selection of what is to be chosen are done simply on the basis of the sum total of individual welfares (Sen 2009).

The utilitarian calculus based on happiness or desire-fulfillment can be deeply unfair to those who are persistently deprived since our mental make-up and desires tend to adjust to circumstances, particularly to make life bearable in adverse situations. It is through ‘coming to terms’ with one’s hopeless predicament that life is made somewhat bearable by the traditional underdogs, such as oppressed minorities in intolerant communities, sweated workers in exploitative industrial arrangements, precarious share-croppers living in a world of uncertainty, or subdued housewives in deeply sexist cultures.

(ibid., p. 282)

This ‘coming to terms’ includes the acceptance of differentiated distribution of vulnerability and precariousness that neoliberal economy promotes.

Habit and domination

Social scientists who intend to critique the economic logic do not have to go far, in that a return to classical texts may provide enough food for thought. Max Weber argues that markets are antithetic to all other communities, because the latter, not the former, presuppose ‘brotherhood’ among people. But let us expand on Weber’s thought.

In trade, the guarantee of legality on the part of two individuals involved is based on the presupposition, often shared by both, that each of them will have an interest in continuing the exchange in the future, and that therefore will respect the pacts and the promise given. But because trade is a form of socialisation with strangers, therefore with enemies, at the origin, the supervision of legality was entrusted to the religious authority, under the tutelage of the temple, which with time became the state. Supervising over legality, however, does not guarantee the rationality of economic initiative, which by pursuing maximum profitability is constantly urged to cross the boundaries of legality itself. There is, therefore, an element of substantive irrationality in the economic order, determined by attempts to make short-term speculative profit, described by Weber as ‘pure gambling interest’, which ‘is one of the sources of the phenomena known as the ‘crises’ of the modern market economy’ (Weber 1978, p. 40).

Weber adds that humans are creatures of habit, but they are also strongly motivated by their material and ideal interests to circumvent conventional and legal rules, and ‘in all societies the economically powerful tend to have a strong influence on the enactment and interpretation of the law’ (Roth 1978, p. lxix). For this reason, Weber’s work on economic issues is in a sense a sociology of domination, in which the gradual usurpation of collective power results in legitimate institutional force.

Following a Weberian classification, power implies the use or threat of coercive force on those who are given orders, whereas domination is to be understood as legitimised, internalised propensity to obey orders (Ruggiero 2015). This also applies to the economic sphere.

Legitimacy, however, though internalised, needs constant justification on the part of those who have authority, wealth and honour to give reason for their good fortune. Economic thought offers such constant justification.

Ultimately, what prevails in Weber’s examination of economic activity is a sense that such activity follows a goal-oriented rationality, which is mainly ‘traditional’ in its orientation. ‘Even in cases where there is a high degree of rationalization of action, the element of traditional orientation remains considerable’ (Weber 1978, p. 69). It is against this tradition that the next section of this chapter will now turn.

Poverty as the trigger of development

Practitioners of economics are not allowed friendliness, they are required to describe human motivations as pure and simple, and keep their economic models devoid of such things as goodwill and moral sentiments. It is extraordinary that economic thought has evolved in this way, describing human goals in such spectacularly narrow terms, also because ‘economics is largely an offshoot of ethics’ (Sen 1987, pp. 1–2). Individuals may well understand and wish to maximise their interest, but practical morality should perhaps lead them to the recognition that theirs and other people’s interests are interdependent.

The recognition of interdependence may suggest following certain rules of behaviour, which are not necessarily of intrinsic value, but which are of great instrumental importance in the enhancement of the respective goals of the members of a group.

(ibid., p. 85)

Many economic schools of thought fail to recognise this interdependence, although they attempt to persuade us (along with Adam Smith) that the interests of the butchers are linked with those of their customers. We have to infer that the values of economics are found in economics itself and accept, for example, a notion of justice as inequality, because inequality supposedly encourages the disadvantaged to follow in the footsteps of their role models, namely the privileged. The reality is that the example set by the privileged does not indicate how to create wealth, but how to take it from others. If not acquisitive crime, this gives rise to instability, and the latter to social harm, and the irony is ‘that while inequality gives rise to instability, the instability itself gives rise to more inequality’ (Stiglitz 2012, p. 91).

It is inequality itself, its explanation and rationalisation, which have mobilised the most ingenious talents in the economics profession.

In nearly all economic history most people have been poor and a comparative few have been very rich. Accordingly, there has been a compelling need to explain why this is so – and, alas, on frequent occasion, to tell why it should be so.

(Galbraith 1987, pp. 2–3)

Poverty as the result of divine displeasure was turned by economists into inequality as the trigger of development and happiness, and while political economy merged with theology, existing social relations were sanctified. As Thomas More (1997, p. 127) argued centuries ago, one can perceive a ‘conspiracy’ on the part of the wealthy, who through devices and ‘all means and crafts’, try to ‘keep safely without fear of losing what they have unjustly gathered together’. These devices are then turned into laws, whereby the only legitimate thing the non-wealthy can do is endeavour to imitate the wealthy.

That such an endeavour is implausible is proven by another core notion we find in economic thought, where freedom and equality are deemed irreconcilable. Economics posits that distribution of resources is spontaneous, neutral and market-driven. Following the examples of the privileged, therefore, will only generate acquiescence for a system allowing the privileges openly displayed to remain accessible to a few. If left alone, markets will produce, so we are told, the most efficient and just outcome. This self-serving notion, in fact, justifies a mere upward redistribution of income, and making rich people richer does not make everyone else richer. In brief, wealth trickles up. Moreover, the very ‘trickledown’ metaphor does not refer to a gushing waterfall or a po...