Greg Palast is the author of the New York Times bestsellers Billionaires & Ballot Bandits, Armed Madhouse , The Best Democracy Money Can Buy and the highly acclaimed Vultures’ Picnic, named Book of the Year 2012 on BBC Newsnight Review. His books have been translated into two dozen languages. His brand new film of his documentary reports for BBC Newsnight and Democracy Now! is called Vultures and Vote Rustlers.
Palast is known for complex undercover investigations, spanning five continents, from the Arctic to the Amazon, from Caracas to California, using the skills he learned over two decades as a top investigator of corporate fraud. Palast, who has led investigations of multi-billion-dollar frauds in the oil, nuclear, power and finance industries for governments on three continents, has an academic side: he is the author of Democracy and Regulation, a seminal treatise on energy corporations and government control, commissioned by the United Nations and based on his lectures at Cambridge University and the University of São Paulo.
In the 1970s, after earning a finance degree from the University of Chicago while studying under Milton Friedman and other “free trade luminaries,” Palast went on to challenge their vision of a New Global Order. He did this while working for the United Steelworkers of America, the Enron workers’ coalition in Latin America and consumer and environmental groups worldwide.
Palast is Patron of the Trinity College Philosophical Society, an honor previously held by Jonathan Swift and Oscar Wilde. His writings have won him the Financial Times David Thomas Prize. Palast was called”An American hero,” said Martin Luther King III and the ultra famous political activist Noam Chomsky says Greg “Upsets all the right people.”
Palast won the George Orwell Courage in Journalism Award for his BBC documentary, Bush Family Fortunes, where he exposed George W. Bush dodging the Vietnam War draft.
His accomplishments go on and on, so we encourage you to learn more about Greg at http://gregpalast.com
ANNOUNCER: Welcome to Creating Wealth with Jason Hartman! During this program Jason is going to tell you some really exciting things that you probably haven’t thought of before, and a new slant on investing: fresh new approaches to America’s best investment that will enable you to create more wealth and happiness than you ever thought possible. Jason is a genuine, self-made multi-millionaire who not only talks the talk, but walks the walk. He’s been a successful investor for 20 years and currently owns properties in 11 states and 17 cities. This program will help you follow in Jason’s footsteps on the road to financial freedom. You really can do it! And now, here’s your host, Jason Hartman, with the complete solution for real estate investors.
JASON HARTMAN: It’s my pleasure to welcome Greg Palast to the show! He is a true investigative journalist, and I say that because there are so few of them left nowadays. He reports for the BBC and The Guardian, among others, and we’ll give out some websites and links where you can find his information. He’s the reporter for a documentary entitled Vultures and Vote Rustlers, and as the author of New York Times bestsellers The Best Democracy Money Can Buy, Armed Madhouse, Vultures’ Picnic, and Billionaires and Ballot Bandits. And it’s great to welcome him today. Greg, how you doing?
GREG PALAST: Great. Glad to be with you, Jason.
JASON HARTMAN: Well, we’re glad to have you. And where are you located, just to give our listeners a sense of geography?
GREG PALAST: Well, right now I’m located in New York. I report for BBC television out of London.
JASON HARTMAN: Fantastic. Well, tell us a little bit about some of your thoughts on the global financial meltdown, globalization, Goldman Sachs, those kind of things. I mean, you report on a wide variety of issues, but I wanted to maybe mainly touch on those.
GREG PALAST: Yeah, my specialty is following the money. My degree’s in finance, and one of the things I like to do in my work as an investigative reporter—it’s amazing how many documents kind of fall through my little chimney. And one document was a confidential document, a confidential memo, sent by Tim Geithner, who was our Secretary of Treasury recently, to Larry Summers, who was in New York. Both Larry Summers and Tim Geithner had traded terms as US Secretary of the Treasury under Bill Clinton and under Barack Obama. This goes way back to ’97. Now, why would we be interested in this memo? The answer is because the memo—in the memo, Geithner tells Summers that it’s—we’re about to enter the endgame. Now, what was the game that they were playing, and why was it ending?
In this memo, which you’ll see on Vultures and Vote Rustlers—in this memo, Geithner’s talking about a meeting between Larry Summers, Robert Ruben, and the top bankers in America. Secret meetings—which, by the way, were illegal, because you can’t have secret meetings. They can meet, but they can’t hide it from the public. And there was a good reason why they were hiding it; this was the head of Bank of America, of Citibank, of JPMorgan Chase, of Goldman Sachs.
These guys were secretly getting together—believe me, this is like a conspiracy nut’s wet dream. They were getting together to decide how they could rip apart the policing of the financial system worldwide. Now, why would they want to do something that berserk? The answer was, that Goldman and JPMorgan had just created a brand new so-called market. Not in goods, but in bads. In toxic derivatives, in financial derivatives. In fact, JPMorgan had $88 trillion—that’s trillion, with a ‘t’—trillion dollars of toxic assets on its balance sheet. Trillion dollars. They had to offload them. So, they had to—you can’t—this was the result of deregulating the US financial market, or decriminalizing, I should say. Deregulating is a very polite term for decriminalizing previously criminal activity—
JASON HARTMAN: That’s a better word. Decriminalizing, or just selectively, or really not at all, enforcing. I mean, I sort of wonder if we need any more laws. We just need enforcement of the laws we have on the books.
GREG PALAST: Well, in this case they were ripping off the laws, the regulation, the enforcement for sure. And, but you know, if the US goes berserk, and like for example, you take all the cops off the street, and all the security guards out of the banks, people are gonna move their money to other nations. How do you prevent that? The answer is you remove the financial police worldwide. How do they eliminate the financial police worldwide? They do that by deregulating banks worldwide—now, how can you possibly do that? The answer was quite brilliant, and that’s what was in the endgame memo. The game was to use the World Trade Organization—the World Trade Organization rules, to basically eliminate financial regulation worldwide. Now, how does that work? The answer was, every nation in the world wants to trade with the United States. We’re the biggest market. We’re the people with the credit cards, the PayPal, and we buy everyone’s goodies. If you want to sell to the US market, for most nation that’s life or death.
The deal was, you can’t sell us your bananas unless you agree to tear down your financial regulations and agree to accept, in return for your bananas and engine parts and raw material, that you accept in payment our derivatives, and toxic assets, and collateralized debt obligations, and mortgaged securities, the securitized mortgage bundles. So, the world, to trade with the US, basically faced—your economy collapses, or you accept JPMorgan’s toxic junk. And that’s what we found in the memo. In fact, when I say—to confirm this, you’ll see this in Vultures and Vote Rustlers—I actually fly to Geneva. Summers and Geithner wouldn’t speak to me. A member of Bill Clinton’s cabinet did speak to me to confirm that the documents were true. Joe Stiglitz who later won the Nobel Prize, he’s head of the Council of Economic Advisors, he said yes! This was going on! It was horrifying! It was horrifying! And he was scared to death. He told everyone listen, this is going to blow up in our face, and they fired him.
Then I flew off to Geneva, Switzerland, and met with the head of the WTO, of the World Trade Organization. I met with the generalissimo of globalization himself, and yes, he confirmed this memo and many others that I got from the inside. Then I flew off to Ecuador, in South America, and met with the president of Ecuador. Actually, I met with two presidents of Ecuador; the one going in, and one going out. Two presidents of Ecuador, and went over the documents of Ecuador as an example, where Ecuador is getting told, we’re not gonna buy your bananas, baby, unless you accept our toxic junk. Unless you deregulate your banks. This is not a small issue in Ecuador, because the nation exploded. They deregulated their banks, the money flew out of Ecuador banks to Florida, the toxic junk arrived, Ecuador’s banks collapsed, and there were riots in the capital when hungry Quechua Indians came down from the Andes and burnt down the capital.
So, the president of Ecuador who, by the way, was an economist at an America university, he was fascinated by this material and said, can I have a copy of these documents? And I said, well, it says Ecuador on it, I’m sure you can. But he said, yeah, there’s no question, this was—he suspected this was happening, and but he didn’t know about it. Even the president of Ecuador didn’t know about secret deals between Ecuador and his own nation’s finance minister, the World Trade Organization, and the US Treasury.
JASON HARTMAN: Unbelievable. Just unbelievable. But, let’s just back up for a moment, and just talk about a kind of a context of this. I mean, these are negotiations of deals between countries.
GREG PALAST: Yes.
JASON HARTMAN: So, one country has this to exchange for another country who has that to exchange. And they come together, and it’s a meeting of the minds. So, isn’t this just a meeting of the minds? Isn’t this just a business deal? I mean, is it right to blame the US for cutting a good deal for themselves?
GREG PALAST: Well, let’s break that into two parts. First of all, let’s not blame the US. Jason, you weren’t contacted to approve this. I wasn’t—
JASON HARTMAN: Fair enough.
GREG PALAST: Hey Jason, hey Greg Palast, what do you think of this idea? Will this benefit you as a citizen of America?
JASON HARTMAN: It’s more about the lobbyists for Goldman Sachs, of course.
GREG PALAST: It wasn’t even the lobbyists. It was the top guys. Here—you’ll enjoy this one, by the way. One of the ways I confirmed the authenticity of this memo, is that it had the private phone numbers of the top guys at Citibank and Bank of America and Goldman, so, I called! I called the phone numbers! And you didn’t get to a secretary, you didn’t get to some—
JASON HARTMAN: Did Lloyd Blankfein answer his cell phone?
GREG PALAST: I actually got—first I got to the former CEO of Citibank, Kaminsky. And I got him! Hi! [LAUGHTER]. He was surprised—it was kind of a special line to the US Secretary of Treasury. And of course I had to declare, I’m Greg Palast, BBC television, and so that was a quickly ended conversation. Suddenly all those numbers went dead. But it was funny, those numbers were quite authentic. In fact, you can get them and dial them yourself, you’ll see. But the—although they don’t go to those presidents anymore, and those CEOs. But, so, I had to go confirm this stuff. But no, it was not a fair deal between two nations. Like I said, we Americans didn’t get anything out of it. Now, when we have trade negotiations between nations, it’s trade in goods. In other words, we get Ecuador’s bananas, which, that is their main export, until recently oil. We get Ecuador’s bananas, and we sell them computers, or engine parts. Actually our computers come from China. We deal with China; in return we sell them Boeing airplanes. That’s called trade in goods. What this was, Jason, was a trade in bads. In other words, we get their bananas, and we give them our collateralized debt obligations! Which are like bags of poop! Of financial poop, you know!
JASON HARTMAN: This is one of the ways—you know, a lot of people, Greg, a lot of the guests on my shows, and you know, I’ve read extensively about it. For some reason I have this morbid fascination with doom, and the end of the world, and the dollar collapse. You know, and a lot of people talk about how the dollar is going to collapse, America’s going to collapse, there’s gonna be another economic meltdown, and so forth. But what you’re talking about right now is just one more of so many examples of the John Perkins-style economic hit men concept, you know, where the US is bullying the rest of the world into these bad deals. And it’s not fair. It’s not right. But the argument that I make is that it can continue for decades to come.
GREG PALAST: Well, I want to just, you know, just again emphasize, it’s not America that is forcing the rest of the world to eat financial poison. Collateralized debt obligations, etcetera. Just so you know, even I—
JASON HARTMAN: You want to make the distinction that it’s the Wall Street banksters.
GREG PALAST: It’s the banksters, talking in collaboration with the top Treasury Department officials. I’m talking about the head, the Treasury Secretaries. So it’s not, again, the American people. Citibank, for example. Robert Ruben at the time was Secretary of Treasury. He had been prior the CEO of Goldman Sachs, becomes Secretary of the Treasury. While he’s Secretary of the Treasury, there was an illegal, at that time, because bankingderegulation hadn’t been signed yet, there was an illegal combination of American Express with Citigroup. With Citibank, creating something called Citigroup. Now, that was combining investment banking with commercial banking, where you keep your savings in a nice little kind of piggy bank which is guaranteed by the US Treasury. So now we have investment banking, which is kind of a financial casino; you have suddenly the American public is on the hook, backing a casino, rather than a piggy bank. That was completely illegal, but Robert Ruben t urned a blind eye, didn’t object, then changed the law to again decriminalize it, and within six months, he left the Treasury within six months, he was made co-chairman of this new combined previously illegal entity. He was paid a compensation, Robert Ruben, of $110 million. He goes from the US Treasury, sits on top of an illegal combination, makes $110 million. It goes bankrupt, and the US Treasury puts in $50 billion in bailout money. That’s you and me. And $4 trillion, and that’s with a ‘t,’ $4 trillion in loan guarantees to Citibank. This is how it works. And again, it’s not the American people. It’s not the American government—or, it’s not America that did this—it is the guys at the top getting together, and cutting the deals for themselves at your expense and my expense and the expense of places like Ecuador, which burnt down, at the expense of places like Peru, which burnt down—
JASON HARTMAN: Iceland.
GREG PALAST: And Iceland, which melted. And, you know, in Iceland, they were fairly sensible. In Iceland, they arrested the prime minister and the finance minister for shenanigans, and they threw them in prison for melting the nation’s economy. In our—in the case of the United States, you don’t get hard time, you get bonuses. And that’s part of the problem. Is that, like I say, we’ve decriminalized this type of thing. It used to be called—when you sell derivatives of derivatives of derivatives, these eighth order derivatives—that used to be called selling watered stock, and that is, you’re selling an ass—a security, which actually has no asset, no thing under it that it represents. That used to be against the law. Then it became—then suddenly guys like Lloyd Blankfein, and Ruben, and Jamie Dimon—suddenly they’re geniuses, because look at them.
They’re selling all this brilliant stuff. And look how much money they’re making. Well, yeah! If you sold counterfeit lottery tickets, you could probably make a great deal of money. I don’t see how that makes you brilliant. And then in fact, in the case of Goldman Sachs, when they offloaded mortgage securities that they knew were going to go bust—they knew were going to go bust—and they offloaded them to Iceland and to European credit unions, and the Royal Bank of Scotland, and all these places went bankrupt. Royal Bank of Scotland, the biggest bank in Britain, went bankrupt. The CEO of Goldman Sachs was considered a genius because he offloaded this junk, well he knew it was junk! In fact, with a investment banker named Paulsen, Goldman Sachs bet that the mortgage securities that they sold would go bust, and Goldman and their client made $4 billion when those securities went bust. It’s like a car dealer selling you a car and betting immediately, putting a bet, that your car will blow up and explode, in 24 hours.
JASON HARTMAN: It’s just unbelievable. So, what’s essentially happened here, is that the US government has been hijacked by the banksters, and the high, high-level ultra-rich corporatocracy, through lobbyists? Is that how?
GREG PALAST: Yeah, well, I mean, in the case of Clinton and Bush and Obama—so, it’s a bipartisan deal—we stopped having lobbyists influence the government. They became the government. So like I said, Robert Ruben, the Secretary of Treasury, came from Goldman Sachs, and then went to this new kind of Citigroup monster that collapsed. Larry Summers became a big shot investment banker being paid millions of dollars by these same guys whose companies he created as Secretary of the Treasury. And so, they all became part of the—in other words, it was no longer, as I say, a case of lobbying or influencing the government. They became the government. And used it as their own little—it’s like they took a hammer, busted it open, and took the money out as their own little piggy bank. And that’s the problem, is that our government has become the banksters. For example, in the case of Barack Obama, and you asked me before the show whether I was on the left or the right and whatever, and I was laughing, because, you know, the right thinks I’m on the left, and the left thinks I’m on the right, and the thing is, I’m an investigative reporter. So I go after both. In the case of Barack Obama, who had ever heard of this guy? Right? The one we were waiting for—
JASON HARTMAN: Right, the one who came out of nowhere.
GREG PALAST: He came out of kind of nowhere. I was, by the way—I lived in his district as a state senator in Chicago, and he was a nobody, Obama. And up until a bankster—a billionairess named Penny Pritzker, was worth about $4 billion, picked this guy out, because she’d been running a bank in his state senate district called Superior Bank, which had fleeced all the poor people. This is a very poor community. Had fleeced all these poor people with crazy subprime loans. She was one of the inventors of subprime loans. It caused tremendous destruction. Because this junk was considered illegal at the time, Penny Pritzker personally, with her brother, was fined $400 million. I don’t think anyone in American history has been personally fined $400 million except Penny Pritzker. She was barred from ever having anything to do with banking. So she decided the only thing she could do was pick a president. So she found Obama, decided to make him president, set him up in a deal with Robert Ruben and Jamie Dimon who lived in Chicago. Pritzker, Dimon, and Ruben put the big money behind Obama, and when he became president, of course, he picked Ruben’s guys to run the Treasury Department, and today, Penny Pritzker, who had one of the biggest fine in American history for criminal operation, who is not allowed to get near a US bank by a consent decree, is the United States Secretary of Commerce. Is in Obama’s cabinet. She’s in Obama’s cabinet. So there it is!
JASON HARTMAN: You couldn’t write fiction like this. I mean, this is just unbelievable. We live in a—this is a crazy world.
GREG PALAST: Yeah. And so, and that’s why—
JASON HARTMAN: And Tim Geithner, the guy who doesn’t file his tax returns, becomes Treasury Secretary. You know, this is just insanity. It’s so obvious.
GREG PALAST: Yeah. And the thing is, is that, you know, the US papers would not touch this issue of Penny Pritzker becoming Secretary of Commerce. She was blocked, by the way, in his first term by labor unions, because she was known as a union buster, on top of everything else. But, even the unions have lost their clout, because after all, she raised three quarters of a billion dollars for him. And I know that there’s the myth—my democratic party friends don’t like this—there’s a myth that Obama was created by this kind of kiddy campaign, of people putting in nickels and dimes and all these small donors. That’s a bunch of crock. Because yeah, the suckers came in and put in their nickels and dimes. But after Robert Ruben and Jamie Dimon and Penny Pritzker, and a group she literally called the Ladies at Lunch, on the Gold Coast of Chicago, got together with Obama. After they created this guy, that’s what made him president. And he returned the favor—he didn’t put any nickel and dimer donor in the cabinet. He put Penny Pritzker in the cabinet. And I would like someone to tell me what qualifies her, other than raising three quarters of a billion dollars for Obama. And imagine what Rachel Maddow would say if George Bush took in someone who had one of the biggest criminal activity fines in finance—in American history—and put that person in the cabinet. I mean, this is someone that makes Dick Cheney look like a Muppet.
JASON HARTMAN: I know. It’s just crazy, it’s just crazy. The thing that I get to, Greg, is I—you mentioned right at the beginning of the show, you talked about lack of regulation, right? And decriminalization of these various unethical activities—I want to say illegal, but maybe they’re not actually illegal—in the financial world. However, I really wonder though, from a broader perspective, if we just back up and we look at this from the 60,000 foot level, and we look at the whole game, and the way it’s played. If it isn’t regulation, that backdrop that really brought us here in the first place. Because—these companies, they go on TV, and they talk about how they don’t like government regulation and so forth. But they really love it, because it helps them create and maintain monopolies. It makes it impossible for new players to enter their markets and get on their turf, because the compliance burden is so high. Now, of course, once you get to the stage when you’re too big to fail, then it becomes wonderful, because you basically are the government. It’s like, the people on the right say, oh, you know, Obama, socialism, this is terrible. And Bush was really pretty much the same deal. But really it’s fascism! That’s what we have. We have—the corporate players are just in bed with the government! It’s ridiculous!
GREG PALAST: Well, that’s what happens with—you know, I see the need for kind of cops on the financial street, just like you have, you know—you get a ticket if you go through a red light. I think there’s a value in having stoplights on the street, and cops to enforce it. The problem is if the cops are on the take. And some guys get to block off the streets and speed at will.
JASON HARTMAN: You know what, a very good example of that is Moscow, Russia. So, in Moscow, everybody has these blue sirens that they just pull out and they stick to the top of the car with a magnet. And you know, those are all the elite class, right? And there are many, many, many of them. They’re not government. They’re not emergency vehicles. They’re just people.
GREG PALAST: Well, you know, it’s very funny. Look, here’s one of the problems you run into. Because of the Great Depression, the federal government—it guarantees—guarantees your savings account. Guarantees the solvency of banks thereby. And therefore, in return for the American public providing this no-fail insurance to the banks, we expect them to do certain things. And not do certain things. Like, if we guarantee someone’s savings account, you’re not allowed to take that money out and go to Vegas for a weekend. I wish that they had, instead of creating collateralized debt obligations. You know, if they’d simply blown a few trillion in a bad weekend in Vegas, it wouldn’t have been so bad. That would not have been as destructive as what in fact happened. We’ve had, you know—that’s the problem, is that once we start down the path of saying, look, we really have to guarantee people’s money, and your savings, which makes sense. But now you’re saying to a private entity, whatever happens, it’s all guaranteed, so go crazy guys. And that’s the problem. When they say deregulated, the other side of the equation is wait a minute! That’s like saying, we’re gonna provide you fire insurance for your house, but we’re now gonna say it’s okay to just have a campfire in your living room. Well, the house could well burn down! You know?
That’s not a surprise! And these guys are like, if they made money they kept it, if they lost money, we paid! This was one of the deeply troubling things—and then, Obama—remember, as a result of some of this shenanigans, we’ve had millions lose their homes to foreclosure, and no one’s had their home guaranteed. Obama was so proud of the fact that there were a quarter million mortgages that were rewritten, so people would not lose their homes. A quarter million, out of four million. Okay, so, basically one out of twenty homes, approximately—let’s say, most people lost their homes, he didn’t do anything about it! So we as people didn’t get guarantees. And it’s very important when you—when there’s a mortgage and a foreclosure collapse, everyone in the neighborhood loses out! When you have that foreclosed home next to you with the weeds growing up—
JASON HARTMAN: Yeah, it’s a bad deal.
GREG PALAST: It’s a disaster. And so, there was no—there was no—there used to be something called a social contract. We give these banks some protection, but in the end, all we wanted was a safe piggy bank, reasonable loans, a mortgage, and you know, a loan for our kids to go to college. And instead, these became officially—you know, government-backed loan-sharking operations. And that’s what I talk about in Vultures and Vote Rustlers. In fact, I had one of the last pieces—it’s eight pieces from my investigative reports from BBC television. And in the last piece, called Goldman Sachs Attacks, you’ll love this, Jason. In Vultures and Vote Rustlers, in that story, I don’t know if people are aware of this. Some of your sophisticated listeners do know this. Goldman Sachs was turned into a commercial bank with government guarantees, a government-backed commercial bank. It has been an investment bank—
JASON HARTMAN: Well of course. They all converted when the financial crisis happened. They just all instantly became regular commercial banks, versus investment banks. Unbelievable.
GREG PALAST: The purpose was so they could then get government bailout money. Because an investment bank is just like—Lehman Brothers, they allowed that to go bust. So the others said, well, we’re not investment banks anymore, we’re commercial banks. Which is usually like a bank where you can put your savings, they have ATM machines, and branches you can put your money in. Well, in the story I did, I realized that Goldman Sachs, if it was a commercial bank, under the law, has to have branches and ATMs and provide mortgages, and student loans, and provide service to its community. That’s called the Community Reinvestment Act. That’s by law—in other words, we give a guarantee to commercial banks, but they gotta give us something back. So I started investigating it. And sure enough, Goldman—now, a lot of banks, like Citibank, they don’t want to bother helping the average—so what they do is they give like a half a billion dollars to a bunch of community banks, community credit unions, and say okay, you take care of our goods side for us. Here’s a check. And they loan you money. Goldman Sachs got $20 billion from the US Treasury, and to fulfill its obligation to help the public financially, it made a big shot $5,000 donation to a little community bank.
JASON HARTMAN: Aw, isn’t that nice? That would be like—let me see. That would be like me cutting up a penny and giving a little tiny portion of a penny….
GREG PALAST: And then what happened was, then they took back the $5,000! Do you know why? Because they gave it to a community credit union, the Lower East Side Credit Union in New York, which is near Wall Street. They said okay, that takes care of our obligation, that’s five grand to this little bank, community bank. It also happened to be the bank of an organization called Occupy Wall Street. So, when Goldman Sachs—
JASON HARTMAN: Yeah, they didn’t like that, right. I remember hearing that story, actually. Yeah.
GREG PALAST: —the banker of Occupy Wall Street, they withdrew their $5,000, and told all of the other banks, withdraw your money! This is the banker for Occupy Wall Street! Like when people put money in those buckets on Wall Street, they took it to this credit union. And so they removed the money. Now, that’s illegal! Another illegal activity. Because you can’t—they didn’t give that money out of generosity. It’s the law that they had to give this money out, even though it was like ridiculous, the amount. But even that they couldn’t stand. So it’s like, the problem here is that—but they understood, in a way, that a protest like Occupy Wall Street—and bankers who supported something like Occupy Wall Street—were ultimately a real threat to their bank, because it was an expression of public anger.
Whether you agreed with the Occupy Movement or not, it was an expression of people who were just fed up to here and saying we don’t want to be in these commercial banks anymore. Forget it. Or, like these investment bank casinos, wearing commercial bank clothing, which is what Goldman Sachs is in. So even today, I’m trying to figure out what it does—what Goldman Sachs does, in return for all the money we gave them. Because they are required, under law, to—if they’re gonna be a bank, to be a bank! Where’s my student loan for my son, guys? That’s the law. And once again, if I don’t follow the law—you know, the troops are at my door, right? The police are at my door, right? If I don’t have a license plate on my car, I drive down the street, I’ll be stopped in three minutes. Goldman Sachs, for all the billions we gave them, they’re supposed to give us something back. It’s called banking. And they haven’t don’t that. But no one’s saying a word, because hey! They’re Goldman Sachs. And Obama says, in the case of JPMorgan Chase, hey, that’s his favorite banker.
When JPMorgan Chase was caught again, and again, and again, in financial shenanigans, which we back, because we guarantee this bank—like the London Whale story? Which is about a bank gone wild, losing billions of dollars, trying to corner the market on treasury bonds, which is what it was all about? They knew that they were doing something illegal. The top guys knew they were doing something illegal. And they said, oh, some small guy went wild. $10 billion wild?! And again, the American public picks up the tab, because we are guaranteeing them. And Obama’s statement, after some people said, now it’s the fourth criminal or quasi-criminal activity that we’ve caught JPMorgan in—how come, how come you are not doing something to rein in this rogue bank? And Obama’s statement was, and I quote, this is your president, saying, “I wish other banks had managers like Jamie Dimon.”
JASON HARTMAN: [LAUGHTER]
GREG PALAST: We didn’t have anybody—we’d be eating out of garbage cans!
JASON HARTMAN: I know, unbelievable.
GREG PALAST: —was stunned and asked him, well, why are you allowing, you know, under government supervision, allowing Jamie Dimon to have these giant bonuses, given everything? And he literally said about Dimon, who is again, head of JPMorgan Chase, said, why should we punish Jamie Dimon? And you know what, Mr. President? If you don’t know why we should publish JPMorgan’s CEO, a bank gone completely wild with our money—if you don’t know why he should be punished, you really are not fit for that office. I’m sorry.
JASON HARTMAN: Unbelievable. And you know, every couple years it seems like there’s a big scandal with Merrill Lynch and some crooked dealings that they’re engaged in, and it just goes on and on and on. Yet, Obama thinks that anybody who makes over $249,000 a year is flying around in a private jet, and they should be demonized. It’s just like at every level, you can tell the corporatocracy has bought the government. They own the senate, they just own the government. Maybe not the Supreme Court. But they own the other two branches.
GREG PALAST: Well, it’s interesting. One of the things that we find is that, you know, you have—for example, Obama got up during the presidential debates, because Mitt Romney, whose worth is somewhere north of a quarter billion dollars, pays almost no tax. His biggest tax loophole is that he uses something called carried interest deduction, and it really only applies to a few billionaires. There’s very, very few people who get to use this loophole, and it’s mostly billionaires who are speculators. It’s not people—you know, job creators, it’s a real stretch. So even—in fact, Baron Rothschild wrote an editorial for the Wall Street Journal saying, we really gotta get rid of this tax break. It’s an embarrassment. I mean, there’s a lot of ways to save money, but this is like—giving a tax break for speculation to billionaires is a little bit embarrassing.
We should get rid of this. If we gotta get rid of something, this is it. So Obama said, that’s the one single loophole he said he was going to close. He didn’t. Because his own buddies, from Silicon Valley, who were raking in the billions, said wait a minute, that’s our tax credit! So, he didn’t realize that democrats got these tax credits which were draining the treasury of billions too. So he never brought it up again. Instead, he eliminated the reduction of two percentage points in Social Security taxes. So you now, instead of the billionaires having to pay taxes on their billions, Obama raised, by two percentage points, added two percent tax on wages. So if you work for a living, you got two percent tax. If you avoid working for a living, you got a tax break. And that’s—that’s the progressive president! I’m not saying the republicans would have done it different. This is a guy who was supposed to say that—made big speeches about inequality in America. You know what, save me the speeches. Don’t charge me for working for a living by raising Social Security taxes.
JASON HARTMAN: It’s crazy. It’s just unbelievable. It is unbelievable at every level. Greg, give out your website, tell people where they can find you, and find the documentary. By the way, I’ve watched about half the documentary. Really interesting stuff; I highly recommend it.
GREG PALAST: It gets better, and funnier. If you don’t laugh, I’ve missed it, because it’s so grim that you’ve gotta laugh.
JASON HARTMAN: It’s the only release we can have, is a little bit of laughter among the absurdity.
GREG PALAST: And in fact, it ends with an actual cartoon of the Koch Brothers saying their vulture friends, little birdies, feeding their little chickadee, Chris Christie. So, it’s investigative reporting with cartoons. Vultures and Vote Rustlers, and it’s a DVD, or you can get it as a download, at www.GregPalast.com. By the way, this is put out by my not-for-profit foundation. Unlike my other films, it’s purely to support not-for-profit, non-partisan investigative reporting. But you’ll have fund with it. It’s about an hour and ten minutes. It’s Vultures and Vote Rustlers. Just go to www.GregPalast.com. www.GregPalast.com. And, you know, you’ll get some laughs, and a lot of information, and I hope you’ll enjoy it, because you’re gonna see the stories. Almost all these stories were on BBC television in Britain. And you’re gonna see the stories that they don’t let you see on the American lamestream.
JASON HARTMAN: Yeah, well, the American lamestream media is owned by the corporatocracy, some, thank God for the Internet while we have it. Make use of it, folks. That’s the admonition of the day here, is to make use of the Internet. Highly make use of it. Well, Greg Palast, thank you so much for joining us today. Again, you gave out your website; I highly recommend the documentary, and keep up the good work, and keep exposing these people. True investigative journalism; thank you.
GREG PALAST: Jason, you do great work, and thank you for bringing me across the electronic Berlin Wall. Bye.
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Transcribed by David
The Jason Hartman Team
Episode: CW 378: When Deregulation Becomes Decriminalization with Greg Palast Author of ‘Vultures & Vote Rustlers’ & ‘Billionaires & Ballot Bandits’
Guest: Greg Palast
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