Photo of Bill Moyers Bill Moyers Journal
Bill Moyers Journal
Bill Moyers Journal
Watch & Listen The Blog Archive Transcripts Buy DVDs

December 12, 2008

BILL MOYERS: Welcome to the JOURNAL.

For a fellow who's still supposed to be in charge of a country in deep crisis, President Bush has been spending an extraordinary amount of his little remaining time mounting a last-ditch courtship of the media. He's eager to tell us how he would like to be remembered.

CHARLIE GIBSON: Much has been made of his historically low approval ratings, but Mr. Bush tells us he's leaving office with his head held high.

LESTER HOLT: They took some time out to talk to NBC's John Yang about what it's been like to go through the past eight years together.

JOHN YANG: I think a lot of people are curious, I'm curious, about what it's like to live in the residence, with the bright lights on the building.

BILL MOYERS: For all the questions put to him about his legacy, however, the press seems strangely uninterested in his controversial treatment of the Constitution and the Rule of Law: torture, surveillance without a warrant, or prisoners of war, the Geneva Convention and the claims the president has made for expanding the power of his office. That unlimited view of authority may well be the centerpiece of his legacy.

So there are plenty of tough questions to be asked about it, and Glenn Greenwald, a constitutional lawyer, has been asking them. Visitors to the blogosphere will recognize the name immediately. His blog on, "Unclaimed Territory," is one of the most widely read on the internet. His loyal readers describe him as "A blogosphere superstar," and "One of the smartest and most important new voices in politics." And, I would add, journalism.

The new media is his stage. But he's also written two best-sellers: HOW WOULD A PATRIOT ACT? about President Bush and executive power, and this one, A TRAGIC LEGACY, an analysis of the president's record. His most recent is GREAT AMERICAN HYPOCRITES.

Glenn Greenwald, welcome to the JOURNAL.

GLENN GREENWALD: Great to be here, Bill.

BILL MOYERS: Even before the president set out on this recent round of efforts to shape how we think about his legacy, you had already pronounced it a tragic legacy. What's tragic about it?

GLENN GREENWALD: There are conventional measurements that historians typically examine in order to assess presidential legacies. Obviously you can look at the two wars that this president started, one of which, in Iraq, is viewed by overwhelming majorities of Americans as being a grave mistake. It was launched based on false pretenses, an extraordinary way to start a war. It inflicted severe damage on our readiness and the credibility of the United States around the world.

The other war is now seven years old in Afghanistan and is worsening by the minute. It's very difficult to even envision a positive outcome sufficient to render the initial decision to invade a smart thing to do independent of whether it was justifiable. The economy is obviously in shambles. And obviously the legacy, when looked at by those standard measurements is an unparalleled disaster.

I call it tragic because after 9/11 the president really had an opportunity to rejuvenate the American sense of unity and common purpose. People, including vehement ideological opponents of his were lined up behind him, supporting him in the wake of 9/11. And not only was that opportunity squandered -the reverse happened. The country was as divided as it ever has been before in the way in which Americans regard their government is at an all-time low.

BILL MOYERS: But the paradox is that you were impressed with the president after 9/11. You talked about his eloquent and principled response to terrorism. And you yourself said Islamic extremism is a threat to this country. And then you lost your faith in him.

GLENN GREENWALD: Well, if you go back and read the speeches that were given in the immediate aftermath after 9/11, the president that appears in that time period is literally unrecognizable. The emphasis was not on any of what ended up taking place. There was no sense of we are going to go to war with the Islamic world or start invading countries indiscriminately or creating gulags and secret prisons and institute a torture regime.

Not only was none that mentioned, the opposite was emphasized, that our response was going to be extremely directed. He made a personal point of meeting openly with Muslim leaders in the United States and emphasized that our war was not with the Muslim world, that it was critical if we were to conduct our response intelligently and effectively that it be targeted and restrained and limited to the extremists who were waging war against the United States.

And had he adhered to those original commitments, I think the presidency would have been much different. At the time, I was living in Manhattan and was litigating constitutional cases. As you say, my interest was much more in vindicating constitutional values on a case-by-case basis, rather than being active politically. And it was only once I saw how radical of a war was being waged on the rule of law and our constitutional values by this administration, justified by the 9/11 attacks, that I think that political activism was necessary.

BILL MOYERS: You talked about Iraq, the present-going war. But then you come back and use the term "war" in response to a war on the Constitution?

GLENN GREENWALD: Well, if you look at things that people have said who are responsible for what I call the war on the Constitution, before 9/11, what you find is that these ideas, including removing Saddam Hussein, but beyond that, wildly expanding executive power, erecting a wall of secrecy around our government such that transparency is virtually non-existent. Empowering the president to ignore literally laws that are passed by Congress in the name of national security.

These ideas were implemented after 9/11 and using the 9/11 attacks as justification. But the ideologues who implemented them, Dick Cheney and David Addington and John Yoo and the whole cast of right-wing ideologues who fill the Justice Department, have been advocating these ideas, which for decades were fringe and discredited ideas long before 9/11 and just like the idea of remove Saddam Hussein, they were empowered to institute them as a result of these crises.

BILL MOYERS: Well, you were saying they were discredited. But all wartime presidents expand the powers of the office. Woodrow Wilson, Franklin Roosevelt, Lyndon Johnson, Richard Nixon. I mean, there's something inherent in war and the expansion of powers. Are you saying that Bush and Cheney took it further?

GLENN GREENWALD: I'm saying they took it to an entirely different level. What we have, in the last eight years, is not merely a case of individual and isolated law breaking. It's a declaration of war on the whole idea of a law itself, on the idea that our political leaders are constrained in any way by the limitations of the American people imposed through our Congress. The rule of law has essentially ceased to exist. And that I do think is quite new.

BILL MOYERS: Was there a moment when what you lay what you have called "creeping extremism" became apparent to you in a minute particular?

GLENN GREENWALD: Actually, there was. And I'll describe to you exactly what it was. It was in 2002 when Jose Padilla, an American citizen born in the United States on U.S. soil, was essentially abducted by the government - by the U.S. government. And it was - he was accused in a press conference held by John Ashcroft of being the dirty bomber.


GLENN GREENWALD: Of seeking to detonate a radiological weapon within an American city. Obviously something that is a crime and it should be prosecuted as a crime. But rather than announce that they intended to indict him and bring charges against him, as the Constitution requires, the Bush administration instead announced that it has the power to arrest and detain American citizens on U.S. soil indefinitely based solely on the say so of the president without having to charge that person with a crime and without even having them have access to a lawyer.

And that's exactly what was done the Jose Padilla, a U.S. citizen in this country, for years. And the lynchpin of American liberties since the founding, as the founders said, has been that the government does not have the power, not even the British king had the power since the Magna Carta, to order citizens imprisoned without charges based solely on the unchecked say so of the president. That is the power that this government assorted and seized and exercised. And that's when I realized that things had gone radically awry.

BILL MOYERS: What do you mean when you call President Bush a Manichean warrior? I mean, most people don't know what Manichean is and don't care. What do you mean by it?

GLENN GREENWALD: Well, the idea of being a Manichean comes from this third century BC philosophy that - or religion really that basically understood the world, a never-ending battle between the forces of pure good and the forces of pure evil. And all human events could be understood said adherence to this religion through that prism.

And it was a very simplistic idea that even early Christianity rejected as not appreciating the complexities of how the world actually is and the ambiguities, the moral ambiguities that characterize who most of us are in most situations. George Bush views the world and his followers viewed the world through this lens of pure good versus pure evil.

And it's not me saying that. He said that in virtually all of his speeches. And when you see the world that way what it means is that if you're on the side of pure good, as he asserted that he was and we are, it means that anything that you do, no matter how limitless, no matter how brutal and immoral, is inherently justifiable because it's being enlisted for service of the good.

And by contrast, anything that you do to those on the other side is inherently justified as well because they're pure evil. And from the war in Iraq to the torture camps and secret prisons that we set up all of the things that have done so much damage, I think that's the mentality that lies at the heart of it.

BILL MOYERS: But wasn't - isn't Islamic extremism, any religious extremism - isn't it pure evil?

GLENN GREENWALD: Well, I think clearly the people who perpetrated the 9/11 attacks or the people who just unleashed that terrorist attack in Mumbai and so many others over the past several years, if anything, embodies evil. I think it's fair to say that they do. To say that the world is not divisible into pure evil and pure good is not to deny the existence of pure evil.

Pure evil exists. It's just the exception and not the rule. And to view the world in these clean and clear and absolute moral categories will inevitably lead you astray. It'll do worse than lead you astray. It'll lead you to abandon the moral principles that you claim make you on the side of good in the first place.

BILL MOYERS: To be fair, you make a strong case in here that we have to stand up to extremism but that we have to protect our own constitutional principles while we do. And as I read both of these books, it is the sense that out of this Manichean view there came this whole notion that you say is alien to America, this unitary executive powers of the presidency. Have I stated that right?

GLENN GREENWALD: You have. Let's just quickly describe in the most dispassionate terms, as few of euphemisms, as possible, where we are and what has happened over the last eight years. We have a law in place that says it is a felony offense punishable by five years in prison or a $10,000 fine to eavesdrop on American citizens without warrants. We have laws in place that say that it is a felony punishable by decades in prison to subject detainees in our custody to treatment that violates the Geneva Conventions or that is inhumane or coercive.

We know that the president and his top aides have violated these laws. The facts are indisputable that they've done so. And yet as a country, as a political class, we're deciding basically in unison that the president and our highest political officials are free to break the most serious laws that we have, that our citizens have enacted, with complete impunity, without consequences, without being held accountable under the law.

And when you juxtapose that with the fact that we are a country that has probably the most merciless criminal justice system on the planet when it comes to ordinary Americans. We imprison more of our population than any country in the world. We have less than five percent of the world's population. And yet 25 percent almost of prisoners worldwide are inside the United States.

What you have is a two-tiered system of justice where ordinary Americans are subjected to the most merciless criminal justice system in the world. They break the law. The full weight of the criminal justice system comes crashing down upon them. But our political class, the same elites who have imposed that incredibly harsh framework on ordinary Americans, have essentially exempted themselves and the leaders of that political class from the law.

They have license to break the law. That's what we're deciding now as we say George Bush and his top advisors shouldn't be investigated let alone prosecuted for the laws that we know that they've broken. And I can't think of anything more damaging to our country because the rule of law is the lynchpin of everything we have.

BILL MOYERS: What do you think it would take to arrest what you call the erosion of law and hold officials accountable? What do you think should be done?

GLENN GREENWALD: Well, there's first of all, it's probably the case that if you have a president who repeatedly and deliberately broke some of the nation's most serious laws and the country decades that, just like ordinary Americans when they break the law, the president should be held accountable and subjected to investigation and prosecution, there probably is no way to do that without creating some divisiveness.

I mean, it's going to be a controversial thing to do. The problem is that if you decide that you're not going to do it in order to pursue political harmony or bipartisanship, what you're essentially announcing is what we've been announcing for decades. When we pardoned Richard Nixon for his crimes, when the Iran-Contra criminals were pardoned and now even continue to serve in government, which is that the rule of law is not for our highest political officials.

Barack Obama could do several things. He could form a commission of the type that investigated 9/11 attacks that is endowed with absolute subpoena power to disclose all of the facts which, to this day, are still suppressed regarding how this government spied on American citizens, what it is that we did to detainees, all of the other programs that we don't know about that are violative of the law so that all of those facts are disclosed and the American citizens can assess what ought to be done.

He could appoint a prosecutor, someone like Patrick Fitzgerald, who's renowned for independence and integrity, and tell him, "Investigate these accusations the way that all other criminal accusations are investigated. And wherever the chips may fall that's what should happen," because we don't have a country where our political class has a license to break the law.

BILL MOYERS: But Glenn, realistically, if Obama did that, wouldn't he be unleashing the partisan dogs? Wouldn't he be just dividing the country hopelessly?

GLENN GREENWALD: Well, I'm not sure that that's the case. I mean, certainly Richard Nixon watched as all of his top aides in the White House were hauled before tribunals of every kind. Many of them actually did go to prison, although Richard Nixon should have but didn't. And the American people understood that we cannot have a country where our political leaders are free to break the law.

Because what happens if you allow serious law breaking to go unpunished is you're telling political leaders, current and future, that there's no need for you to abide by the law. There's no reason for you to consider yourself constrained or limited in what you do. Because even if you commit crimes while in office, we're going to be too afraid of creating divisiveness, that's we're going to allow you to do that. And you incentivize the political class, as they've been doing, to break the law at will. And the damage that comes from that is infinitely worse than whatever this divisiveness is that so many people are afraid of when citing why we should let these criminals go free.

BILL MOYERS: But how do you investigate your own party? The fact of the matter is Democrats knew about this wire tapping without warrants that conducted by the telecoms. And then they voted to give the telecom communications companies immunity. Barack Obama opposed giving them immunity and then reversed himself on it. So how does an incumbent president or an incumbent party in Congress investigate itself?

GLENN GREENWALD: Well, I think what you're getting at is the reason why the political class on a bipartisan basis is coming together to say, "Oh, no, we don't want to investigate these crimes. We think it's best to let it go." It's not because they're being magnanimous. It's not because they think it's important that Barack Obama be able to fix the economy undistracted by the controversies that would be created.

It's because exactly as you said. Top Democrats were complicit in these crimes and assented to them. I mean, it wasn't just the warrantless eavesdropping.

In 2002, as the WASHINGTON POST documented, Nancy Pelosi was brought to the CIA and along with Jane Harman and Bob Graham and Jay Rockefeller, the key Intelligence Committee Senators, were told about the torture program that the CIA had implemented, that we were going to water board and had water boarded certain suspects, that we were going to do things like hypothermia and stress positions and forced nudity and sleep deprivation.

All of the tactics that we've always said characterized tyrannies that used torture. That we were going to start using them ourselves, even though they clearly violate both international and domestic law. And according to all public reports, and they're not denied by the participants, every single Democrat in that session either quietly assented to it or actively approved of it.

And so the question then becomes, well, as a matter of political reality, how is Barack Obama going to encourage investigations of crimes to be undertaken when the leading members of his own party were, if not-

BILL MOYERS: Good question.

GLENN GREENWALD: -participants were certainly complicit? And there are things that he could do. He could appoint, as I said, an independent prosecutor and say take this road to wherever it leads. And if it leads to leading Democrats who you think have criminal liability, so be it.

BILL MOYERS: So would you be prepared as a lawyer to narrow this down to just the perpetrators, if they can be identified, who authorized, knowingly authorized torture and a violation of the Geneva Accords? Would you begin there? And if so, whom would you indict?

GLENN GREENWALD: I would absolutely start at the top. We know from public reports that interrogation techniques, specify interrogation techniques, that every civilized country regards as torture were choreographed and approved of at the highest levels of the Bush administration inside the White House at the so-called principles meeting.

We know that the president himself ordered illegal surveillance on the American people even after his own Justice Department told him that doing that was illegal and even after they threatened to resign if it didn't stop. So this is the kind of criminal intent, deliberate law breaking that we punish on a daily basis in this country.

BILL MOYERS: What would you like to see Obama actually do about this the moment he becomes president?

GLENN GREENWALD: I think it's imperative that the inaugural address be an expression of the political values that he intends to have guide him during his presidency from the first day on. And so I think it's vital that he renounce the core theories that have made the Bush presidency so lawless.

And so, for instance, I think he needs to say that he doesn't intend to view himself as being above the rule of law, that he intends to be faithful to the vision and design of the founders that the president, like everybody else, is subjected to the rule of law and to the laws that the American people enact through their representatives in Congress. I think that's vital.

BILL MOYERS: I've never known a president - it's not in the nature of political men to give away the powers inherited in their office.

GLENN GREENWALD: Well, that's there are real difficulties for him to fulfill the agenda that he committed to as he spent the last two years running for president. He renounced the core theories of the Bush administration that vested the president with the powers that we've been describing and vowed that he would renounce them almost immediately upon taking office.

The idea that Article Two allows the president to disregard congressional statutes or to interrogate prisoners. There are certain things that he could do by executive order such as closing Guantanamo - ordering the enhanced interrogation technique, so-called, the torture program to cease immediately.

But what really is necessary beyond those specific measures that he can do unilaterally is to have a restoration of the separation of powers and the checks and balances in our government. I mean, Congress has become virtually invisible, impotent, powerless, by its own accord, almost voluntarily. And so until Congress reasserts itself and insists that the president's powers be constrained by what the Constitution prescribes Obama can take steps that are positive unilaterally.

But it won't really be a true restoration of our constitutional form of government. It'll almost be as though we have a benevolent dictator, somebody who exercises unilateral power in ways that are good or ways that are better. But we need Congress to reassert itself in terms of how the government functions.

BILL MOYERS: In a classic sense, I mean, your book is "A Tragic Legacy". But in a classic sense, tragedy refers to the downfall of a great man against superior forces, usually his own destiny. Shakespeare, in a sense, it's a sense of someone who comes to a disastrous conclusion that causes one to feel pity or terror. I don't have a sense that people feel pity or fear of Bush right now. So it - can you say it's a tragedy?

GLENN GREENWALD: I don't think George Bush is a tragic figure who inspires the kind of emotions that people who are the victims of tragedy typically inspire, which are pity and sympathy. Tragic is an adjective that modifies legacy. And the reason why I think his legacy is tragic is because there was an opportunity for the 9/11 attacks to generate very positive things for this country. And that opportunity was squandered by a whole variety of forces, not just George Bush, but the people around him who manipulated him quite successfully to fulfill this preexisting ideological agenda.

And so I think if you look at George Bush, I think he's not tragic. He's culpable. But I think if you look at the legacy that his presidency is leaving for the country that does fulfill the criteria of tragedy.

BILL MOYERS: Glenn Greenwald, thank you very much for being with us.

GLENN GREENWALD: My pleasure. Thank you.

BILL MOYERS: You have to feel, in more ways than one, for those workers who staged a sit-in at that factory in Chicago. Just as their heroic cry for justice was capturing the attention of the country, the press got swept up in a saga of corruption worthy of a banana republic. The feds' 76-page indictment of Illinois Governor Blagojevich would make Al Capone blush.

The late bard of Chicago, Studs Terkel, used to say, if Chicago isn't the most corrupt city in America, it's certainly the most theatrically corrupt. No wonder Obama wants to get out of town. But while corruption is a tale oft told, even in the land of Lincoln, what those workers did is an act of uncommon courage.

It was only a week ago that the company they work for, Republic Windows and Doors, told them their plant was being shut down for good. The employees were stunned. By law, they were entitled to 60 days notice and some parting benefits. Instead, they got just three days notice, and their health insurance was terminated.

The owners said the company's cash flow was suffering because of declining sales in home construction, and that Bank of America had canceled their line of credit, making it impossible to pay the bills. But at the same time, Bank of America was drawing down $25 billion in bailout money from taxpayers, including taxes paid by the workers being laid off. This is money, you'll remember, intended to open the spigots of credit so banks could do the very kind of lending so desperately needed by companies like the one in Chicago.

And that's not all. It turns out the company's owners are shutting down this union factory at the exact moment they're starting an operation in Iowa, where they can use non-union labor at lower wages.

More than 200 workers then launched what they called "a peaceful occupation" of the plant. We shall not be moved, they sang. President-elect Obama - once a community organizer in Chicago - joined the chorus and endorsed the rebels, saying they represent millions of workers who are losing their jobs, their health insurance, even their homes.

WORKERS: Yes we did! Yes we did! Yes we did!

BILL MOYERS: Wednesday night, the sit-in ended. Public pressure forced Bank of America to relent and come up with a cash loan to pay the fired workers what they're owed.

Which brings us to what was happening this week in Washington, where Congress was asking the Bush administration, 'What ever happened to the 700 billion dollars we gave to bailout the economy?' That's what those workers in Chicago wanted to know as well. So to connect the dots I'm joined by Emma Coleman Jordan. She's the editor of a book due to appear early next year, the title of which says it all: THE SHORT END OF THE STICK.

Professor Jordan teaches commercial law and economic justice at Georgetown University. She's a former White House Fellow and Assistant to the Attorney General. She's been tracking the hearings in Congress trying to nail down what has happened to the 700 billion dollars. Welcome back to the JOURNAL.

EMMA COLEMAN JORDAN: It's good to be here.

BILL MOYERS: Why did it take a workers' revolt and public outrage to get a huge financial institution like Bank of America to do the right thing?

EMMA COLEMAN JORDAN: Well, I think these large institutions think they're beyond accountability. It appears there were no management structures in place in the Treasury Department to keep track of exactly what these banks were doing with the money. The money was given. The top banks were given $25 billion each, including Bank of America, JP Morgan Chase, banks that protested they didn't need the money. They were asked to take this money anyway It was expected that they would convert these capital infusions into lending.

BILL MOYERS: But they didn't. They got-


BILL MOYERS: -the money but they didn't lend it. Bank of America was not lending the money-

EMMA COLEMAN JORDAN: They weren't lending the money. They were busily making tactical acquisitions.

BILL MOYERS: What do you mean?

EMMA COLEMAN JORDAN: Buying other companies, Merrill Lynch, a very formidable former investment bank, just on the eve on its failure, was acquired by Bank of America.

BILL MOYERS: I read that of the first big wad of cash, something like $160 million or so, that the government handed out for lending, the banks paid more than half of it to shareholders. Which means those workers losing their jobs in Chicago, while investors are getting taxpayer funds for dividends, right? Is that your understanding of what's been happening?

EMMA COLEMAN JORDAN: It's an economic cruelty, is one of the ways of thinking about it. Where taxpayers, or people who are at the bottom on an income spectrum are asked to pay taxes into a fund that is used to rescue failed financial management strategies and practices.

BILL MOYERS: So help me understand why it is that institutions that take so much of your, my, and everyone else's money is spending it - are spending it on dividends.

EMMA COLEMAN JORDAN: Well, because there's no accountability. We have a leadership at the Treasury Department that has decided we'll just trust them.

BILL MOYERS: Trust who?

EMMA COLEMAN JORDAN: The financial institutions that produced this global crisis.

BILL MOYERS: That's not trust. That's gamble. Right?

EMMA COLEMAN JORDAN: Well, you make a point that I think is a good point. But more importantly as the belief system that Secretary Paulson brought to the decision making. And what was that belief system?


EMMA COLEMAN JORDAN: The belief system was one in which he believed that by fixing the problem at the top, by giving the money with trust to his peer institutions on Wall Street, the money would trickle down in the form of lending to consumers and businesses. And the economy would be restored. And so that way of thinking dominated his decision making, slowed things down.

The facts that were clearly on display were simply ignored. And I'm giving Secretary Paulson credit for being a very smart man. I believe that the delays were caused by pre-commitments to an economic belief system that has been turned on its head by this crisis.

BILL MOYERS: The ideology is that trickle-down economics will work and that the market will eventually correct the excesses? Is that what you think that ideology is? That's the bubble they live in on Wall Street, right?

EMMA COLEMAN JORDAN: It's that confluence of belief, the Federal Reserve, the Department of the Treasury, and the White House, all believing that the markets would correct. So that in the year between August of 2007 and September of 2008, we had a natural experiment. And the natural experiment was the markets did not correct. They crashed and burned. And as a result, the government had to come in to rescue with the taxpayers' dollars.

BILL MOYERS: Just this week, the House Financial Services Committee berated the Assistant Secretary of Treasury, Neel Kashkari, who's supposed to be running the bailout, for not tracking the money. Look at this.

REP. BRAD MILLER: You going to tell us ever who got the money that we paid under AIG's derivative contracts? And if not, why not?

NEEL KASHKARI: This is a tough question, because it's hard to know, did this dollar that the taxpayers go in go to this use? Did it go to paying expenses? So I'm-

REP. BRAD MILLER: That's really not a credible response.

REP. STEPHEN LYNCH: What are we doing? What are we doing to address that piece of it, the lack of transparency? We've got to get this thing going again, and as long as people don't trust each other, folks are going to be afraid to lend.



REP. DONALD MANZULLO: An executive at AIG just got a bonus of $3 million. The three executives from the Big Three said they would work for $1 a year. I'm asking you, if that's the case, is TARP going to ask for the money back?

NEEL KASHKARI: There have been some press reports about AIG that are referred to bonus schemes. When I've looked into it and had our people look into it, there have been some cases where they had deferred compensation that was already earned by people, not the CEOs.

REP. DONALD MANZULLO: Well, deferred compensation of $3 million?

NEEL KASHKARI: Remember, Congressman, we got rid of the management team of AIG.

REP. DONALD MANZULLO: Well, who are these new clowns getting that money?

NEEL KASHKARI: Again, Congressman-

REP. DONALD MANZULLO: Why can't you just give a simple answer so the people I represent can have confidence in you? I don't think you understand. I don't think you understand at all the pain and the hurting that's going on in this country or that people were on the verge of losing their jobs and you can sit there and not come to a decision as to whether or not a $3 million bonus is too much? If you even have to ask that question whether it's too much, Mr. Kashkari, you're not the man for the job.

BILL MOYERS: Do you think this Congressional reaction is representing the frustration at the grass roots? Of people who are finally saying as Howard Beale said in that famous movie, "I'm mad as hell and I'm not gonna take it anymore"? You think that's happening? Is that what the Chicago sit-in represents? A Rosa Parks moment?

EMMA COLEMAN JORDAN: I do. I do. It is an opportunity that these workers took to stand up directly. And it's interesting because they targeted not just their employer, Republic Windows and Doors, but they targeted Bank of America. If you saw those signs, they explicitly understood the connection-


EMMA COLEMAN JORDAN: -between finance and the closing of the plant. And the workers simply said, "This is not fair. We're," like you said, "mad as hell and we're not going to take it anymore." And they took direct action. I think that's a healthy thing for our democracy.

BILL MOYERS: Let me take it one step deeper because workers and ordinary people were getting the shaft, as you say in your upcoming book, long before this meltdown. And here's the question that goes to whether or not we have a fair economic system. Some of the financial corporations and individuals at the center of this crisis over the years contributed big sums of money to both parties.

AIG alone gave $1.5 million to the politicians just before it got $85 billion in loans from the government. Freddie Mac was already receiving federal funds as it was giving out in political contributions half a million dollars. Citigroup, Goldman Sachs, Bank of America gave hundreds of thousands of dollars to both political parties for their conventions this summer. Banks, hedge funds, investment companies gave millions. I mean, look, you spent your life exploring economic justice in this country. Would you say that the system is rigged so that advantage is always taken by the people at the top of our financial system of those who are paying the bills?

EMMA COLEMAN JORDAN: I agree with you that our campaign financing and political financing system and the lobbying that takes place is a scandal, a shame. And it is a breach of the deepest trust of our democracy. Anyone who believes in the Jeffersonian ideal of a democracy in which we have transparency and we have accountability, the flood of money coming in has meant that we can't trust decisions. This has been an indictment of the way business and politics are done. And it is a cause for a serious consideration of deep finance reform for our political activities.

BILL MOYERS: "Time" magazine this week says that while no one is looking, Congress and the IRS have been quietly changing the tax code to lower corporate taxes for years to come. Are they receiving bailout money through the front door while they're getting tax breaks and other privileges through the backdoor?

EMMA COLEMAN JORDAN: That's a change which was done at the Department of Treasury without statutory authorization to do it.

BILL MOYERS: They did it arbitrarily?

EMMA COLEMAN JORDAN: They did it on their own, with no consultation with Congress to get permission for this change, since it was absolutely antithetical to the statutory requirement. And I've looked at the comments of tax specialists. I'm not a tax specialist. But the tax specialists say this is unheard of and clearly in violation of the statute which protects the Treasury by not allowing banks that acquire failing banks to get the benefit of the losses of the failed bank and carry those losses over for the benefit of the acquiring bank.

That's a big set of tax reductions. If you can acquire a Merrill Lynch and get their tax losses, that's going to mean that Bank of America pays less. If you can acquire Countrywide and get their tax losses, that is going to improve your position.

BILL MOYERS: Are we chumps?

EMMA COLEMAN JORDAN: Well, you know, that is a word I shrink from. But if I had to answer: in the colloquial, you betcha.

BILL MOYERS: Watch this.

REP. ELIJAH CUMMINGS: Mr. Kashkari, in the neighborhood I grew up in, in the inner city of Baltimore, one of the things that you tried to do was to make sure that you were not considered a chump. And what "chump" meant was that you didn't want people to see you as just somebody they could get over on.

And I'm just wondering how you feel about an AIG giving $503 million worth of bonuses out of one hand, and accepting $154 billion from hardworking taxpayers. You know, because I'm trying to make sure you get it, you know? I mean, and you know what really bothers me is because - all these other people who are lined up. They say, well, is Kashkari a chump?

EMMA COLEMAN JORDAN: Those are harsh words, but in this case I do believe advantage has been taken. And I'll leave it at that.

BILL MOYERS: Don't leave it at that because here's-

EMMA COLEMAN JORDAN: -no controls, no compliance requirements for the financial services industry for $350 billion. And so the fact, this chump term suggests that we are being taken advantage of. We're being taken advantage of because even as taxpayers are being asked to pay more and more, and more importantly, not this currently alive group of taxpayers but our children and our grandchildren are being asked to commit to repaying ever-larger amounts of money even as our foreign creditors are closing in on us and saying, "Hold up. You're gonna have to change your habits. We are not going to allow this to continue. We will not continue to subsidize this kind of profligate debt management."

BILL MOYERS: What about this cover story on this current issue of "The Atlantic"? "After the Crash: China to the U.S., 'Shape Up or Else.'" What's going on there?

EMMA COLEMAN JORDAN: What's going on is a change in the power relations, and we're seeing that the countries who have savings like China are now asserting themselves to tell us to reform our debt dependent ways, both in the public sector and the private sector. They have been financing this. China is the largest purchaser of U.S. Treasuries and other securities, government-related and securities.

BILL MOYERS: They're saying live within your means, right?

EMMA COLEMAN JORDAN: Live within your means. Your credit line has been reduced.

BILL MOYERS: You've been watching these hearings all fall about what's happening to that $700 billion in bailout. What's the picture that's emerging? What are you learning?

EMMA COLEMAN JORDAN: What I'm learning is that the highest officials in our land have proven to be less than capable in making decisions that affect the lives of so many Americans, that we've seen about faces, changes of strategy, no clear coherent strategy for fixing a world-shattering crisis.

BILL MOYERS: Are you saying they don't know what they're doing?

EMMA COLEMAN JORDAN: I'm saying if they know what they're doing, they're keeping it secret. In other words, for those of us looking from the outside, there is no coherent explanation. And the actions that have been taken are incoherent.

BILL MOYERS: One of the surprises I've learned in watching the hearings is that even the agencies that gauged the credit ratings of these loans were in on the fix, right? I mean, they were being paid by the companies whose risks they were supposed to evaluate. And it turns out they let us down, right?

EMMA COLEMAN JORDAN: Oh, my god. That is the most critical - they're just a series of disasters. Let me just say, Fitch, Moody's, and Standard & Poor, I saw that testimony. It made my heart ache to hear the head of these companies being confronted with internal memoranda and e-mails saying, "We'll rate a cow." And they have no explanation for it.

REP. JOHN YARMUTH: This is not an email this is an instant message, or a series of instant messages between two S&P officials who are chatting back and forth. As I show you these you'll see that what they're talking about - they're talking about rating a certain deal. Here's what they said: Official #1: "By the way that deal is ridiculous." Official #2: "I know, right. Model definitely does not capture have the risk." Official #1: "We should not be rating it." Official #2: "We rate every deal. It could be structured by cows and we would rate it."

Now the Committee went back to investigate whether S&P had in fact rated this particular deal, the one the instant message discusses, and yesterday the SEC informed the Committee, the Committee staff that it indeed had rated it.

EMMA COLEMAN JORDAN: And then it turns out that the ratings were based upon home price data that was taken from the middle of the bubble. So there was no data in these models from any period when housing prices fell. That goes into the category that most accountants call GIGO.


EMMA COLEMAN JORDAN: Do you know what GIGO is?

BILL MOYERS: No, I don't.

EMMA COLEMAN JORDAN: Garbage in, garbage out.

BILL MOYERS: Right. Well, you make me think of Enron. Remember all of those scandals at the turn of the century, when the accountants were in on the fraud?


BILL MOYERS: Who can we trust now?

EMMA COLEMAN JORDAN: The raters were rating things that clearly did not warrant A ratings. In one of the hearings, I think it was Congresswoman Watson from Los Angeles who said, on the same day as one of the ratings agency gave a triple A rating to the city of Los Angeles, they gave a triple A rating to Lehman Brothers four days before they failed.

REP. DIANE WATSON: How could any rational person believe that a long-term investment in Lehman Brothers was as safe as a long-term investment in California? That's kind of quirky because we're in a little trouble. But something is amiss if a credit rating agency can give the same assessment.

EMMA COLEMAN JORDAN: That is an indictment of the process. And, more importantly, those hearings revealed ratings shopping. That if I thought you were going to give me a bad rating, you're not hired. I'll go to somebody who'll give me a good rating. Well, that was characteristic of the Enron era as well, where accountants, they were shopping for accountants. And the business would be given to accountants who were more flexible.

So these gatekeepers, the lawyers, the accountants, the credit rating agencies are crucial to the fair operation of markets. And it was the failure of the credit rating agencies that Alan Greenspan found surprising and disappointing that they didn't use self-interest to monitor risk.

BILL MOYERS: It's as if the Good Housekeeping Seal of Approval, which was the standard when I was growing up, was applied to a brothel or a casino, right? Take a look at this.

REP. CAROLYN MALONEY: You were just gambling billions, possibly trillions of dollars.

MARTIN SULLIVAN: Well, I wouldn't refer to it as gambling.

REP. ELIJAH CUMMINGS: Well, clearly, do you believe there was greed?

REP. NYDIA VELAZQUEZ: The people that are watching this debate here or this discussion - they're still waiting to hear an answer as to how this is benefiting them.

REP. STEPHEN LYNCH: I have a lot of people in my district who feel that they've been defrauded and they're mad as hell.

REP. MARK SOUDER: It's clear that greed led to not only 'see no evil, hear no evil,' but 'report no evil.' It's clear that there was fraud here, but there's also, to me, incredible, gross incompetence.

REP. STEPHEN LYNCH: And they think that in light of what has happened to them that someone ought to go to jail. Someone ought to go to jail. And the more I hear in these hearings, the more I read, I am inclined to agree with them. I am inclined to agree.

BILL MOYERS: So does it come down to the basics of ethical behavior, fairness, and justice?

EMMA COLEMAN JORDAN: It does. But, you know, as I hear those Congress people expressing the outrage of their constituents, I have to ask a question of accountability for our elected officials. You've got to step up and do more to make sure that there is proper oversight before you let the money go out the door.

BILL MOYERS: You're saying there's a lot of grandstanding there?

EMMA COLEMAN JORDAN: The theatrical component is very high.

BILL MOYERS: The other big story this week is the bailout of the automobile industry in Detroit. Your whole focus is economic justice.


BILL MOYERS: Is it just to bail out these incompetent, poorly managed, irresponsible magnates who run the automobile industry into the ground?

EMMA COLEMAN JORDAN: One out of ten jobs in the U.S. Think about it that way. Don't think about the managers. Think about those jobs, the jobs of people who are working in dealerships. The jobs of people who are working in parts manufacturing. The jobs of people who are working for creditors of these auto companies. There is a web of connection to these three companies that extends deep into the American economy.

BILL MOYERS: So the answer is yes. You think we should do it?


BILL MOYERS: And should we fire these incompetent managers?

EMMA COLEMAN JORDAN: Well, I think clearly the managers who produced this disaster in the middle of this economic storm ought to be given the opportunity to retire.

BILL MOYERS: Well, now that's being just to a fault, it seems to me. No, I'm serious about this.

EMMA COLEMAN JORDAN: We're at a fragile moment in the global economy. And if this industry is allowed to fail, it would create a death spiral of consequences that are so interlinked that we can't properly calculate what the full impact would be.

BILL MOYERS: You have described a private sector in disarray and a public sector that's incompetent and out of touch. How do we not leave people feeling despair?

EMMA COLEMAN JORDAN: Well, the despair is going to be dissipated by action by citizens, like those people who went into the plant - Republic Windows and Doors in Chicago. People have got to stand up. They've got to demand accountability. And I believe frankly that this past election was the beginning of a process of standing up by citizens who were tired of being disappointed in what they were told about the reasons for going to war, who were tired of getting stagnant wages when the highest paid people in our economy were getting windfall compensation packages for failure. And they decided thatů enough. They wanted a different way of political leadership.

And I believe that this era of accountability is not over. And our new president-elect will see from this nearly energized democratic, small "d," Republicans and Democrats and Independents, all insisting on his accountability. So he's unleashed a set of energies in the country that will hold him accountable as well.

BILL MOYERS: Emma Coleman Jordan, thank you very much for being with me again on the JOURNAL.

EMMA COLEMAN JORDAN: Thank you so much, Bill, this has been wonderful as always.

REP. HENRY WAXMAN: Your company's now bankrupt, our economy is in a state of crisis, but you get to keep $480 million. I have a very basic question for you: Is this fair?

BILL MOYERS: Finally, the other big story out of Chicago this week was news that that city's Tribune Company, owner of the "Chicago Trib" and "Los Angeles Times", as well as other newspapers, 24 TV stations and the Chicago Cubs, had filed for Chapter 11 bankruptcy protection. Its owner, Sam Zell, blamed the economy and $13 billion worth of debt.

When Zell took the company private last year he received a waiver of the Federal Communications Commission rule barring ownership of both a newspaper and television station in the same local market, saying it was the only way he could make the deal work. He was supported in his effort by FCC Chairman Kevin Martin.

Regular viewers of the JOURNAL know that media consolidation has been always been an important issue for us. We've been critical of Chairman Martin and his predecessor Michael Powell's attempts to give the big media multinationals free rein to take control of more and more TV and radio stations, drastically hurting local news coverage, independence and diversity.

That's what the Commission heard last year in public hearings across the country.

CHICAGO PUBLIC HEARING PARTICIPANT: If the FCC is here wanting to know if Chicago's residents are being well served. The answer is no. If local talent is being covered? The answer is no. If community issues are being handled sensitively? The answer is no. If minority groups getting the coverage and input that they need? The answer is no, the answer is no.

SEATTLE PUBLIC HEARING PARTICIPANT: We told you a year ago when you came to Seattle that more media consolidation is a patently bad idea. No ifs ands or buts about it. So with all due respect, I ask you, what part about that did you not understand?

BILL MOYERS: This week, the House Energy and Commerce Committee issued a scathing report attacking Martin's tenure at the FCC. The title? "Deception and Distrust." It chronicles what the authors call "egregious abuses of power" by Kevin Martin, who "...manipulated, withheld, or suppressed [agency] data, reports and information" to support his agenda.

President-elect Obama will soon appoint a new FCC chairman and is solidly on the record against media consolidation. Kevin Martin has hinted to some a willingness to stay on a bit to ease the transition. Thanks, but no thanks.

You can check out our continuing coverage of the FCC and media consolidation by clicking on our Web site at

That's it for the JOURNAL. I'm Bill Moyers. We'll see you next week.

Moyers Podcasts -- Sign Up for podcasts and feeds.
Our posts and your comments
For Educators    About the Series    Bill Moyers on PBS   

© Public Affairs Television 2008    Privacy Policy    DVD/VHS    Terms of Use    FAQ