The collapse of the Soviet bloc in the late 1980s was said at the time to represent the ultimate triumph of market capitalism as a social and economic system. Misguided Marxists seriously underestimated capitalism’s capacity (when married to democratic political structures) to reform itself.

Subsequent events, however, have demonstrated that we overestimated capitalism’s ability to function properly without strong democratic checks on its conduct. The Occupy movement has thankfully brought this issue to the fore of public consciousness.

By now, we have all seen images of the U.C. Davis police officer casually pepper-spraying defenseless students for their “crime” of refusing to leave the quadrangle. Davis was one of many locations where authorities used violence against “Occupy” demonstrators. Elected officials and university administrators have felt no compunction about using force to prevent the political dissent of these citizens.

Contrast these actions with how our nation has dealt with the investment bankers, mortgage lenders, and hedge fund managers who wrecked the world economy. It is hard not to conclude that the fix is in. For example, Federal Judge Jed Rakoff recently rejected a proposed settlement between the Securities and Exchange Commission and Citigroup, finding a proposed penalty of $285 million—without an admission of guilt—indefensibly small. Citigroup allegedly misled customers into investing in mortgage-backed securities that Citigroup itself was betting against. The bank has been cited and fined for the same or similar behavior repeatedly in the past, including 2005 and 2006. This pattern of small settlements without admissions of guilt is the rule, rather than the exception, for SEC enforcement actions.

Within days of Rakoff’s decision, we learned that former Treasury Secretary Hank Paulson—appointed to that position from his role as CEO of Goldman Sachs—“briefed” Wall Street investment leaders and hedge fund managers in the summer of 2008 on the impending federal seizure of Fannie Mae and Freddy Mac, on the very same day he told reporters from the New York Times that he expected federal audits to find that both companies were secure. If true, this is the ultimate act of insider trading, since knowledge of the impending seizure of these two institutions lets those “in the know” escape the financial consequences and even profit from them.

The degree to which our political and legal systems favor the wealthy and powerful is breathtaking in scope and arrogance.

Do you think Secretary Paulson will be punished for this? Don’t bet on it. The Obama administration has done little to investigate and prosecute the conduct that led to our current economic circumstances. This is not surprising. The weakening of both banking and securities regulations was accomplished under the Clinton administration, and the architect of that policy—Larry Summers—was appointed by Obama to manage the nation’s economy at the very moment his earlier “reforms” were enabling the economy’s meltdown.

I highlight these contrasting snapshots from American law enforcement to illustrate how severely our legal and political systems are stacked against ordinary Americans. Despite levels of economic inequality not seen since the Gilded Age, there is little policy effort to reverse this trend. Rather, public policy today is formulated to advance corporate and financial interests that will worsen, not shrink, inequality.

The degree to which our political and legal systems favor the wealthy and powerful is breathtaking in scope and arrogance. Nowhere is this more nakedly obvious than in Republican tax policy. Claiming, falsely, that the current marginal tax rate is severely curtailing investment, the “fix” for this faux problem is yet more tax cuts for the highest income earners. If the economy is growing or shrinking, in good times or bad, the preferred policy is the same. In other words, Republican fiscal “policy” resembles an article of faith, since it is unresponsive to facts, in this case social and economic conditions.

Time and again, we see our representatives manufacturing fake crises and offering phony solutions whose principal purpose is to enhance the political and economic power of the wealthy. For example, the faux problem of vote fraud (there is none) gives rise to Voter ID laws whose intended effect is to drive down voter participation of the poor, working class, and minority voters. Falsely blaming deficits on “overcompensated” public employees is used to justify the phony solution of union-busting legislation, whose real purpose is to defund and weaken one of the few powerful interest groups favoring the working class and poor. The myth of Social Security insolvency demands that we privatize old-age pensions, which would funnel billions of dollars into the pockets of investment banks and brokerage houses.

The Occupy movement has provided a rare moment of clarity. It has drawn our attention to the very raw deal that our government is providing us, and given voice to the plight of working people. Wealthy interests, in turn, cry “class warfare” although they and their representatives have engaged in a 60-year assault, launched with the anti-union Taft-Hartley Act of 1947, on the very reforms that saved capitalism from its inegalitarian excesses. Our future depends on the willingness of ordinary American citizens to “re-start” history, to reject the current political reality where the only choices at the ballot box are between crony capitalism and craven capitulation. They can begin this process by repeatedly and vigorously laying bare the true agenda of proposed legislation, and holding politicians of all stripes accountable for failing, in every way, to assure the fairness of our political and legal systems.