John Christensen ■ Neoliberalism and the Moral Economy of Fraud: book review by Atul Shah
In Neoliberalism and the Moral Economy of Fraud, (Routledge, 2016) David Whyte and Jörg Wiegratz offer an edited collection exploring how neoliberalism has enabled the proliferation of systemic fraud across different geographical and social settings. This book plays a vital role in increasing understanding of unethical behaviour, helping us to address the beliefs and rituals that otherwise perpetuate fraudulent culture, finds Atul K. Shah in this review posted on the London School of Economics Review of Books blog.
Fraud has become endemic and, as we discovered during the great financial crash in 2008, for many years the gatekeepers of capitalism failed comprehensively to protect stakeholders across the spectrum. It wasn’t just the bankers who failed to adequately assess risks in the sub-prime markets. Credit rating agencies were revealed to be worthless in their assessments. Regulators had fallen asleep on the job. Financial journalists were largely copying and pasting from corporate press releases. And auditors were looking the other way. In the absence of any meaningful form of vigilance, fraud spread like wildfire. As Shah notes:
Corporate fraud has become normalised in modern society – including allegations against Volkswagen, one of the top global brands in motoring, HSBC in global banking and Rolls Royce in aerospace: the list goes on. The rot at the top of the finance industry, a key sector in modern business enterprise, has ceased to abate, even after the 2008 crash.
Citing TJN’s John Christensen – who contributed a chapter titled Do they do evil? The moral economy of tax professionals – Shah comments on how professionals licensed to protect the interests of all stakeholders use their knowledge and experience to support tax evasion and avoidance by their fee-paying clients. Tax havens are deployed as platforms from which fraudulent activity can be conducted with relative impunity:
The entire offshore industry and the trillions of dollars which flow through it have made it a fraud beehive. The finance academy largely avoids looking at it microscopically.
Of course not all academics have averted their gaze from the ethical failings that neoliberalism has encouraged, and many of the contributors to this book have offered important insights into the culture and the myths that have propagated this moral economy. As Shah says in his concluding remarks:
The book introduces the reader to radical literatures questioning the depth of neo-liberal hubris in the agenda and actions of modern institutions, including regulators. Just as we fight our local causes, it reminds us to understand the larger forces which shape our language, systems, education and public services – fraud is an ideology that has become a cancer in modernity. To escape it, we must address its corrupt beliefs, stories, customs and rituals. Otherwise, we will stay on an island firefighting or perpetuating fraudulent culture.
Read the full review here.
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