In our past classes, we have mostly discussed income inequality relative to variables including race, age, immigration status, and even by New York City neighborhoods. We have not however, discussed income inequality in association to nationwide geographic locations nor have we seen how living in different United States state and cities could differ in social mobility. The first article from Mother Jones shares insight on how income equality is affected by the fracking boom. From the article, Sheppherd writes how income inequality and social mobility differs from United States city to city because there is a difference in resources available.

For instance, we can compare New York City’s most heavily funded high schools to North Dakota’s failing, under-sourced high schools. Other varying resources that could influence social mobility and income inequality could include racial segregation (of which I was surprised to read about considering you would not see racial segregation as a problem here in New York City as much, but there are instances of segregation further down South, I guess), quality of public education, and affordability of local colleges. From these variables, it is safe to assume that the income inequality and social mobility standard in the cities out Central West would fare worse than wealthy New York State, but that is not the case today. The funny thing about the oil boom and fracking that has been taken place in these states is that it has created more jobs and more income. While I have always regarded fracking as a negative force on society due to its health risks, fracking has closed the income gap in states like North Dakota and has allowed children to move upwards from their parents significantly.

In the American Enterprise Institute article, Mark J. Perry encourages and embraces shale fracking for it has stabled energy prices, increased wealth, and spread jobs. Interestingly, he quotes from author Gregory Zuckerman in his article. In the short excerpt, we see that Zuckerman strongly approves for fracking, which he defines to be nothing short of “American”. He carries on repeating how hydraulic fracturing is innovative and a product from the “American” entrepreneurial culture that has made all Americans wealthy. From reading his excerpt, I was turned off from his constant droning on about fracking being “American”. I don’t know who Zuckerman is, but I disagree with his big fat Republican ideals of how fracking captures the American spirit because not only do Americans “create computer apps, drones, and rap stars,” Americans are surging ahead in energy production. I guess I’m biased because I do not side with fracking, but I just wanted to drop in my comments on Zuckerman’s writing.

Mark J. Perry also supports fracking, but his writing was easier to accept and may I say more intellectual. Not only does Mark J. Perry support fracking, but he also says the income divide is desirable. The Shale revolution has created thousands of millionaires in this time and has therefore increased income inequality in America. However, he states that everyone is better off with lower and more stable energy prices thanks to fracking. He also says that while the Energy Boom made a small group of petropreneurs super rich, it has also made the rest of us wealthier. The problem I have with this statement is yet again, how Republican it sounds. This statement sounds a lot like Reagan’s Trickle Down Economy policy, which as we know did not work as expected. If making the rich richer does make everyone else richer, I would like to see some statistics following the Energy Boom.

From the readings, I think that most people will tend to agree that income inequality that occurred from the Energy Boom seemed to be welcome. Whether it was out in the west where it made moving up in the world easier and made it easier for people to achieve wealth, or it is creating more wealth so everyone becomes wealthier, income inequality in the poorer states where the Energy Boom is a positive affect. However, the Energy Boom will not last forever; it will pass. It will be interesting to see how the state out west fare after the Energy Boom dies down.

There are many issues to take care of, but there is only so much one can do. Environmental issues are far from many people’s minds as they go about their days. Yet we take advantage of the environment and are digging ourselves in a deeper and deeper hole. The transition to renewable energy seems obvious and can actually provide many benefits. Needless to say, the environment will benefit, but economies will also gain quite a bit. Labor demand and future innovation will bring about a growing industry and will spur economic growth.

Kate Sheppard’s article in Mother Jones describes how there are regions of high income mobility areas that fall almost right on top of oil reserves and heavy oil development. Other factors like the public school system and affordability of college were also taken in account, but the author was surprised to see states she normally would not consider, for instance North Dakota and Montana. She even mentions that two thirds of public schools failed to meet the federal standards. So fracking offers a very viable method to increase social mobility in cases where other methods fail to provide that. But of course fracking will eventually come to an end as reserves run dry.

The highest point in fracking development was 2011, and the investments in renewable energy are growing each year. In fact, Tom Randall writes in Bloomberg that “the world is adding more capacity for renewable energy (143 gigawatts) than coal, natural gas, and oil combined (141 gigawatts).” It’s forecasted that power generation capacity additions will continue to grow for renewable energy (with most coming from solar and wind energy) and will decline for fossil fuels. Also, as the price of renewable energy continues to decrease, it’s estimated that solar energy will be the biggest source of energy in 2050. The implementation of this feat will require more employment, so the potential that fracking provides can be met through developing renewable energy.

Mark Perry’s point is also applicable in the context of renewable energy development. Renewable energy can be a source of breakthrough technologies and greater income inequality. We may soon see a few renewable energy giants as we have Chevron and ExxonMobil. But the effects are very beneficial. In the long run, renewable energy will reduce our footprint in global warming and our daily expenses. Many more people will be able to enjoy energy while knowing that they are doing so with the environment in mind and while keeping costs down.

The article on Hurricane Sandy brought up quite an interesting topic. It argued that Sandy intensified a crisis stemming from social and economic inequality. It added that the recovery goal is not only rebuilding for the short term, but also changing for the long term. Matters like inadequate housing, unemployment, and inaccessible services were some of the more apparent problems that were highlighted by Sandy. It’s unbelievable how revealing the low-income residents were damaged prior to and after Sandy. All the while, environmental problems must also be mitigated.

The push towards renewable energy seems like a good start that can address a few of the aforementioned issues and provide a platform for future development. Its implementation is long overdue, but it’s never too late.

 

—

Jia Jun (Jay) Wu

Fracking is a very controversial topic with many pros and cons.  On one side, it’s said to create new job opportunities and on the other, it creates a hazard to the environment. Are these jobs really beneficial to these communities or are we just making excuses to earn short-term profit? Surrounding neighborhoods are most affected by this and we have seen the negative effects in the movie Gasland. However, as I have said before, does the benefits out weight the costs?

Fracking helps the local economy by creating jobs and employment opportunities for their workers. It also attracts many businesspeople into these communities to extract the riches. Fracking may have started as an “innovation” since we are taking risks with our environment in return for financial rewards. This “innovation” isn’t sustainable and it still only benefits the people at the top. In Mark J. Perry’s article, he states that an increase income inequality is a small price to pay for this Energy Boom. I don’t think this is a small price because it’s a big problem that the people at the bottom are still stuck there.

In Kate Sheppeard’s article she states that high social mobility places such as North Dakota and Eastern Montana don’t have the typical social mobility factors, but instead are undergoing heavy oil development. You would typically need quality schools and better education to achieve social mobility. However, it is said that most North Dakota public schools fail to meet federal standards for the year. States like ND benefit from their oil reserves and oil booms from the new advancements in fracking technology. This is just a boom which is only a short term benefit and oil is limited. We should instead focus on building a solid foundation such as in education for the long-term goals and benefits.

The Sandy article presented interesting concepts. Natural disasters such as Sandy has pointed out the weakness in our system and planning. It emphasized the need for more jobs, affordable housing, renewable resources, accessible health care, and etc.  The storm damaged and destroyed 305,000 housing units and the poor do not have the resources to repair their homes. Even New Yorkers living in NYCHA buildings lost utilities such as electricity during the storm. It’s shocking to see that it’s been two years and homeowners still have not repaired their homes. Natural disasters shouldn’t be a surprise, we need to be more prepared and address the weaknesses in our system.

Areas with fracking activities cause serious damage to the environment from what we read and from what we saw in the movie Gasland. It provides income for oil companies, jobs for local workers, and more energy resources. Would it be better if Fracking was more regulated with taxes and regulation?  If not, we need to find alternative solutions such as renewable energy sources. Renewable sources are more costly, but this is where we need to be more innovative to find new ways and cut down the costs (not innovating more fracking technologies).

-JanYing He

Fracking affects everyone and should be a concern to everyone whether you are a child, parent, poor or rich. Those who live in the area where the fracking is being done can feel the largest impact of the process. Despite the poor reputation of fracking, an analysis of it reveals that it can bring benefits to society, while also harming it. The question is, do the benefits outweigh the costs?

Fracking is an example of innovation and the freedom to innovate is important to inspire and move a country forward. Mark J. Perry argues that this is reason enough to except one of the most prominent tradeoffs – income inequality. In other words, we should accept the fact that some people are able to prosper at the cost of many people suffering. It’s true that without this ability and freedom to innovate, citizens will less likely invest in new technologies, and there will be less advancement in society. However, instead of encouraging any type of innovation, society should be motivated to innovate for the better instead of quick profits. The efforts put into fracking could be put into areas such as renewable energy. It seems that fracking is the attractive route because it’s easier, rather than innovative, and therefore whether or not fracking is innovative is questionable.

Areas that have fracking activity experience a surge in their economy. Fracking employs more employees, and therefore more money is circulated in the local economy. This in turns allows for more funding to go into schools and other resources, which in turn encourages upward mobility amongst those in the area. Those with fracking activity seem to the largest increases in upward mobility from the lower end to the higher end. However, as Kate Sheppard mentions in her article, this is only a short-term benefit. The economic boom from fracking is just a boom and the benefits can disappear at any minute whether it is from depletion or a disaster that prevents further fracking activity. Society at large should be more concerned about long-term economic stability and mobility. We can focus on the fact that less than one percent move up because of this or create plans to move a greater number and make society more equal.

Even more important, is the environmental strain fracking puts on the planet. This activity contaminates the water and harms the health of people nearby. It kills the quality of life and requires large amounts of land that can be used for other activities. Wildlife is interrupted and harmed. The planet that the future generations inherit may not be livable space and by then technology may not even be a solution to fix it. The chemicals being released have unknown consequences, and people who are not involved in the decision-making should not have to suffer for the choices of the rich.

Fracking activity is not an innovation as it is argued to be. Yes, it provides jobs and is a new way to gather energy, but it does not advance the society forward in the long run economically and technologically. It’s ability to spur economic mobility is only short lived and causes communities to be heavily reliant on one source of revenue. Once it leaves, communities will be left to scramble and find a new source of revenue. The largest cost is the irreversible harm to the environment that future generations will inherit and force to live on. They had no input on how the planet should be used and should not have to suffer for the mistakes of our generation.

Does fracking have benefits? Yes, it’s a better alternative than drilling for oil. There’s no doubt about that. But it’s only a temporary solution. There are still CO2 emissions and other negative externalities given off. Run-off water damages the environment, animals, and even humans. The video we saw in class showed us firsthand the effects on humans. Yet, it’s still being pushed in the U.S. and lobbied to Congress. I find it preposterous that Cheney was allowed to get away with so much when he was in power. The oil and natural gas industry (not to mention his own company) flourished under his rule. He made sure certain policies were passed, hidden inside laws, that gave the shale oil industry certain benefits.

Today, fracking is wrecking havoc here because the U.S. is one of the largest exporters of natural gas. In addition, fracking leads to less dependence on the Middle East for oil. Domestic production results in lower prices. The AEI article avidly pointed out that fracking boosted the economy and provided much-needed jobs. It has made many millionaires in the process. But it has also has widened the income inequality gap too. The author of this piece thinks that the small price of a little more income inequality is worth it. I’m sure he wasn’t taking into account how high it is already – the Gini coefficient (measures economic inequality) is one of the highest on the planet.

It’s very important to have incentives for entrepreneurs. If there are none, there will be a lack of motivation, and with that, a lack in innovation. I think this is what’s happening now with renewables. Policy isn’t being passed for renewable (such as tax breaks) and this industry is suffering. Entrepreneurs don’t have much motivation to innovate here. The fracking industry however, proved rewards and riches, which attracted many businesspeople.

It hurt me a little bit to read in the article “…future revolutionary, breakthrough technologies like hydraulic fracturing and horizontal drilling.” This technology is not revolutionary – that would be renewable energy. Renewable energy is much more cost effective, creates energy without giving off emissions, and even creates surplus energy. It is a long term solution to the issue at hand, while fracking is barely a “temporary adjustment.” Fracking is by no means sustainable.

Sandy was an atrocity – it seriously pointed out many of the faults in our infrastructure and urban planning. Houses should not be built that close to the water. Mechanisms need to be put in place to prevent flooding. Electrical lines need to be built underground to hinder wide-scale power outages. But the most important was it showed us that we need some fixing before the next storm (no pun intended) hits us. A great way to do this is through policy. Policy is the best way to enforce the law – it can put a focus on, say, renewable energy and updating our infrastructure for example. It can also help decrease the income inequality. But with many politicians getting funding from the rich guys, this will be a huge obstacle to overcome.

Just like how everything in the world has pros and cons, fracking may reduce unemployment rates in areas that have little economic development, but it entails quite a few environmental and health-related setbacks. It has been proposed that fracking companies spark engaging local economies because it offers jobs to the locals. However, could these jobs be considered decent jobs? In our class, we have discussed quite a lot about minimum wages and working conditions, and how all of that relates to income inequality. So is a job in the fracking industry good enough to promote social mobility? Will fracking reduce or actually facilitate income inequality?

As I was reading Kate Sheppard’s article on how research shows fracking can alleviate income inequality, I was not surprised that an argument for fracking is that it produces jobs for locals. A lot of things can produce jobs for locals, not only natural gas companies. We have seen from Gasland that fracking workers as well as locals living near sites are at risk of severe health problems. In the short term, it may seem that conditions for residents have improved because of how effective the fracking industry sparks a booming local economy. However, if we look at the end point on this “success story,” people who were supposed to benefit from this social and economic mobility will in fact fall back down because of major health costs.

Additionally, I agree with Sheppard’s ending remark that fracking is not the ideal way to boost economy and reduce income inequality because it will only be helpful for a definite period of time. Natural gas is a nonrenewable energy source. So just like oil that we have heavily exploited, if we continue to expand the natural gas industry, we will deplete almost all available resources. When natural gas companies fail, workers will go back to being unemployed, or return to lower-paying jobs, with an addition of cancer-like health problems.

Using natural gas to improve income inequality is a false perception because fracking actually proves that unfair income inequality exists and will continue to exist. Locals living in poor, isolated regions of the United States that happen to be near natural gas exploits are being exploited as well. The documentary mentioned that most fracking workers have no idea what deleterious substances they interact with on a day-to-day basis. Is it okay for these locals to pay a big price on their future health for this proposition to improve income inequality? Natural gas company representatives in the documentary were not even willing to take a sip of the contaminated water, which emphasizes the fact that no one should pay the price of their health for anything. But because the locals are low-income and have little say compared to the large fracking companies, they are taken advantage of.

In addition to the points made in the Cohen’s article about natural disasters and its relationship to revealing income inequality, I agree that renewable energy resources are much better than the predominant fossil fuel energy. Renewable energy is currently not a major player in the energy industry because it is relatively more expensive than nonrenewable energy. But actually, only the implementation process for renewable energies is more expensive. In the long run, renewable energy can help save people a lot of money from energy costs. If we could educate every one, especially those who are low income, that renewable energy as a whole is much more money-saving than fossil fuels, we may be able to transition to a green energy economy. But because large nonrenewable energy companies getting their way through lobbying and who knows what, the less privileged may never know the potential for green energy to save money, improve public health, and create a new form of economy.

The first article from Mother Jones presents an interesting new perspective on the notion of fracking. It attempts to point out the positive side affects of the process by displaying the apparent increases in economic activity and economic booms in areas where the practice has become prevalent. Specifically it measures the increase in economic and social mobility from the bottom fifth to the top fifth of the economic ladder in those regions. The chart itself shows the effective probability an individual does just that in those regions. It discovered how the probability is significantly greater in states like North Dakota, Montana, and much of the center portion of U.S. where fracking has become ever so prevalent.

While this is certainly very compelling, I do not believe the issue is really that simple. First of all, way on which this idea was presented was very interesting. It chose to display the probability an individual will rise from the bottom fifth to the top fifth in terms of income in these regions. This brings about the issue of relativity. In these less urban areas of the United States, what is the bottom fifth level of income and the top fifth level of income defined as? Does an individual actually have to increase their income as much as they do in other more urban and developed parts of the country? I do not now what the exact numbers are, but I have to say I believe the top fifth in New York make more than the top fifth in Montana. These individuals do not have to see a dramatic increase in their income to see these come to fruition.

Furthermore, just because everyone is now making a lot more money in these regions does not necessarily bring them to parity with other regions in the U.S. Those in the top fifth in those areas may still be making significantly less than the top fifth in other regions where income mobility is less probable. Additionally, what about the economic state of these places prior to the arrival of fracking and big business? If it was not that good to begin with then not much is needed to have a significant impact on the economy. I am not saying an economic boom is not welcome, but that the statistics may be significantly overestimating the actual impact these businesses have had on the local areas.

Additionally, while helping the economy of these areas is certainly a good thing and can not be argued against objectively, fracking is not a permanent process. There is a finite amount of natural gas and once all of it has been extracted form the area, these businesses will move on. They are not making a long-term investment in the communities they are moving into. So, what happens after they leave? Everything could very well go back to prior to these companies moving into these areas and the local economies could very well suffer. So what exactly are these businesses doing?

For me, this is providing short-term economic success for long-term environmental concerns. The chemicals used within the fracking process are clearly hazardous to the local environment, animals, and people. I do not think there is any mistaking that after watching Gasland in class. Worse yet, these affects are being felt not long after these companies are moving into the area. Within several years the environment is drastically changed. Water is contaminated and the people suffer as a result, whether it is with their own health or of their business. Many were farmers with livestock falling ill from drunk the water. We also saw the impact the environment with the family who experienced haze and difficult to breathe air that fell upon their property after a fracking company had moved onto their property. Hence, I do not believe the fracking is at all worth the short-term economic booms local areas are experiencing as a result of its introduction into the local economies. Its affects are extremely fatal and hazardous to these local areas and are rapidly destroying what had been living there for years. It is not a solution to income inequality whatsoever, rather it is a completely separate problem all together.

Before reading these two articles, I knew very little about insider trading, besides the fact that it was trading on inside details that were not released to the public, which is considered illegal. The article entitled “Former SEC Attorney, James Kidney, Speaks out on Court’s Insider Trading Bombshell” provided an overlook of one case United States of America v. Todd Newman and Anthony Chiasson and his general overview of his experience with these cases. I found the points that he mentioned to be very convincing and conclusive.

Former SEC attorney, James A. Kidney, talks about prosecuting smaller cases to prevent larger cases, or the broken window theory, which he finds to be insignificant and a waste of his time in terms of the damage it causes to the market. He mentions how the Commission “far too many resources on pursuing low level “insider traders” who are far removed from the corporate suite” (Wall Street on Parade). He believes that the focus needs to be on the major Wall Street people who greatly affect the market. In this age and technology, it would be difficult to track down the four to five levels away from the tipster. In the case of United States of America v. Todd Newman and Anthony Chiasson, they were three to four levels from the tipster, which makes it difficult to prove that they had insider trading information through a tipster who focused on personal benefit.

In the article entitled, “The Second Circuit Makes Sophisticated Insider Trading the Perfect Crime,” the broken window theory was compared to Eric Garner’s situation on the selling of cigarettes that could possibly top 70 dollars at maximum and the Wall Street workers who made 72 million dollars from insider trading. As Eric Garner was killed, the Wall Street workers were able to become free from hiring lawyers, which they had probably gained sums from insider trading. In this case, it seems as if Kidney proves right and the power of money goes a long way. Because of the position and the amount of money that Newman and Chiasson may have accumulated, their profits played a big role in the outcome. If a regular citizen were caught, the outcome would probably be different because these guys have the money to hire the best attorney and fight to the bitter end.

Kidney also mentions that there are some who say insider trading should be legal. Legalizing insider trading is a controversial topic itself. In one perspective, it can be seen as a crime with the victim being those who could have had the insider information, but lack it and thus, could have made a better decision. If there leaves no trust in the market, then other investors wouldn’t be trading, while the ones involved in insider trading will dominate and drive up stock prices.

If the focus is put on the middle levels, the Wall Street firms will continue to do insider trading; thus, the spotlight should be put on those who cause the most damage. At the same time, if the smaller cases are ignored, wouldn’t the low level inside traders join the issue as well knowing the focus is strayed away from them or would it bring a lesson? I think the focus should be on the larger cases of insider trading since they cause the biggest effect in the market.

Hydraulic fracturing or “fracking” has recently provided an economic stimulus to many states and local provinces due to the oil and gas-rich rock formations in certain areas. The Mother Jones article “Income Inequality and the Fracking Boom” presents an interesting argument that fracking may actually help alieve income inequality in these regions due to the fact that these activities have brought wealth, jobs, and possibly, income mobility. This argument has been proposed because of the massive expansion of fracking in certain geographical locations that have the formations needed for gas and oil extraction. To address this thesis, I definitely agree that social mobility depends heavily on your geographical location, but there are various underlying drivers that can lead to this mobility, not just one activity such as fracking. Factors such as school systems, social issues, affordability of education, employment levels among others all play a strong role in whether or not there can actually be movement up the income ladder. Fracking may actually be a strong catalyst in income mobility but the author doesn’t necessarily connect the dots as to how it actually is one, and so, I don’t really see the direct correlation in solving income inequality through fracking.

Additionally, my assumption is that this oil boom is benefiting the state and energy companies more, rather than distributing wealth to low-middle income families in these areas. In fact, as we have seen in the Gasland documentary, many families are being severely harmed by the oil and gas drilling, having to either move out or deal with detrimental health problems. Underground water is polluted with carcinogenic chemicals from fracking, which eventually end up in the blood, tissues, and blood of the innocent families that live near the wells. Many of them have absolutely no say when the oil and gas companies forcefully set up shop and dig wells around their homes. These energy companies are not sharing revenue with these landowners either, further hampering any economic incentive that the public in these areas may obtain from fracking.

After going through all of these issues, how then, is fracking reducing income inequality and helping the poor or middle class individuals climb out of their income level? If anything, fracking is pushing these individuals down the economic ladder even more, and forcing them to face a multitude of financial and health problems. Indeed the energy companies may give some sort of remuneration to these families for moving into their lands, but do are these compensations actually commensurate with the costs they are facing? The counter argument against this is that the energy companies may employ people from these towns, providing more income to the towns as a whole. There should definitely be more studies on these economic impacts along with the health effects as well.

After watching Gasland and reading these fracking articles, I was surprised to read Mark Perry’s article from the American Enterprise Institute. I was particularly surprised when he states “We should all welcome the increased income/wealth inequality that will result from future revolutionary, breakthrough technologies like hydraulic fracturing and horizontal drilling.” He argues that fracking has created “an inevitable and highly desirable income divide” because it has generated huge financial rewards for some while creating income inequality for many others. He further tries to justify this greater divide by arguing that innovation, entrepreneurship and greater technologies are all positive outcomes of fracking. Moreover, his statement that “An increase in income or wealth inequality is a small price to pay for The Great American Energy Boom that did bestow massive wealth on a small group of petropreneurs, but also delivered a little bit of greater wealth to all of us” is almost laughable. These points further strengthen my point that fracking doesn’t improve income inequality, but rather increases it.

The metro politics article “New York’s Two Sandys” provides a great example of how natural catastrophes can accelerate inequalities affecting low-middle income individuals. Hurricane Sandy hit New York on October 29, 2012 and flooded our streets, homes, businesses and more. There were of course immediate consequences from Hurricane Sandy, such as damages to physical infrastructures and the local economy. Beyond that however, there were also damages to low-income residents, many of whom were directly affected in regards to their housing. “The storm destroyed or damaged 305,000 housing units in New York City. Poor and working class New Yorkers, especially tenants, immigrants, and people of color, have struggled disproportionately to repair their homes, echoing trends documented in the aftermath of Hurricane Katrina in New Orleans.” Sadly, these lower-income homeowners didn’t get much government funding, even though there was $3 billion in federal aid to the city. This natural disaster shows another way how the environment can affect income inequality.

In this day and age, it’s not uncommon to hear individuals taking unethical means to get ahead in life, especially within business. Such is the case with insider trading, where someone in the firm releases private information that is not available yet to the public to someone(s), and proceeds to get a benefit from the resulting leak.

In the statement by James A. Kidney, a former SEC Attorney, he goes over the standard insider trading trial. Previously, I had no idea that insider trading could go up five levels removed (or more), between the defendant and the insider. However, when the introduction brings up the fact that when a corporate insider gives non-public information to a trader, with the trader having no knowledge of the insider receiving any kind of personal benefit, and this would not count as insider trading crime, it makes me think about how frequent this can occur on Wall Street. Not only is it harder to prove in my opinion, but I agree with Kidney’s opinion of wasted effort on the “broken windows on the street level”.

As a successful SEC Attorney, Kidney finds pleasure in working backwards to find the tipper. He does feel that the Commission wastes too many resources on the small fish, the lower-level insider traders who are too removed from the firm. He feels it would be more efficient focusing on the higher up on Wall Street. Although the Commission seems to be blatantly ignoring the top dogs of Wall Street, Kidney is not. He knows what is going on, and is not excited to discuss the decision of the U.S. Court of Appeals in U.S. v. Newman. The prosecutor has to prove that the distant traders knew that the insider was getting a personal benefit from the transaction.

Because the situation had been that the prosecutors only needed to convince the jury that the defendant knew the information was nonpublic, and that it was coming from an insider source, this ruling made it a lot harder to even crack down on the “broken windows”, not including making enforcement of trading harder in general. It’s only ethical for insiders to not release nonpublic information to anyone for personal gain. With the bonuses and highly compensated salary that comes with the job already, how much money does one really need? There comes to a certain point where more money will not increase overall happiness, no matter what the individual says.

In other news, Wall Street’s court of appeals, also known as the Second Circuit, makes it impossible to retry those who got wealthy via insider trading. This is essentially the Second Circuit protecting the illegal occurrences of insider trading happening on Wall Street. Not only are investors hurt, but so are the numerous honest traders on Wall Street. This can lead to the issues of the fallacies with “trickle-down economics”, how no matter what, the rich just keep getting richer. And now they’re being protected.

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