Tavis: Andrew Ross Sorkin is a widely read columnist for “The New York Times” whose most recent book is now out in paperback. The book is called “Too Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial System and Themselves.” He joins us tonight from New York. Andrew, good to have you back on the program, sir.
Andrew Ross Sorkin: Thank you. Thank you for having me, Tavis, great to see you.
Tavis: Likewise. I want to get to the book in just a second here. Of course, we all know that the president tomorrow, giving a big speech in Ohio about jobs. Of course Ohio, bellwether state. If you’re going to give the speech anywhere, I guess Ohio is as good a place as any to go.
But given what he had to say just days ago – yesterday, in fact, in Milwaukee, what do we expect the president to say tomorrow?
Sorkin: I think he’s going to lay out a plan around how to spur business investment, how to regain the economy’s story back again, and he’s going to be talking about infrastructure spending. So you’re going to hear a lot about how they’re going to be trying to build railroads, get shovel-ready jobs where people can actually get back to work in the middle of America. That’s what this is going to be about.
He’s also going to talk about something very important, which is R&D, so research and development of corporations. There’s going to be a tax credit that’s going to be made available, that’s going to be very, very important. People have been talking about that, and the importance of that, getting this country back to doing the research and development so that we can be leaders again.
You’re also going to be hearing about a number of other tax credits focused on business that may be popular with some and may not be popular with others, but this is all about trying to regain the story, regain the narrative around business and around the economy – something that I think over the past couple months everyone agrees he has lost.
Tavis: We all know the famous Shakespeare question – “What’s in a name?” I raise that to ask whether or not this is really another stimulus by another name.
Sorkin: That’s exactly what it is. It’s just not throwing money at the problem, it’s doing it through a much more concerted sort of straightforward approach, looking at specific issues, and that’s what this is. It is no doubt a stimulus package, if you will; just cloaked as something a little bit different.
Tavis: It might be cloaked as something different, but I don’t think Republicans are going to go for it that easily.
Sorkin: I don’t think they are either, and I think they’re going to say this is too little and too late, except from a political standpoint, tactically, it’s very hard for the Republicans to look at tax cuts, for example, or tax credits for research and development or infrastructure spending and say, “Is this really the wrong thing for America?”
I think you’re going to see that over and over again, but I also think in terms of the political calculus you’re going to see the Democrats then hit back come October and say, “Look, these Republicans are voting against tax cuts.” So I think it’s actually going to be a very interesting next couple of weeks.
Tavis: It might be, I think you’re right, an interesting few weeks, but I guess ultimately the question is whether or not, to your earlier formulation, given the midterm elections, is this too little, too late? What can really be done to cause any kind of uptick for the Democrats between now and weeks from now?
Sorkin: I have to agree with you. I think it probably is too little, too late to the extent that we’re talking about November. I think that all of these measures, by the way, over the long term, if you can see out across the horizon, are actually very important for this country, very important for our economy, very important for jobs.
Will it actually have a measurable impact by the time people get to the voting register? Absolutely not. But I think there’s a sense that he wants to give Americans a sense or a feeling that he’s got a plan, and I think unfortunately thus far that plan seems to have been lacking.
Tavis: But when you say “shovel-ready projects,” and when the administration says, “shovel-ready projects,” that’s the same language we heard around the first stimulus. So if I’m a Republican or an American who thinks the Obama plan ain’t working, I’ve heard this before.
Sorkin: And people are going to say that. They’re going to say this is the same song; this is what’s in a name. Everything you just said, you’re going to hear that over and over and over again.
I think the distinction this time is that they really are more surgical, meaning the steps that he’s taking are looking individually at different issues and really trying to address them, and over time you may not get the jobs immediately – and by the way, some of these infrastructure projects will take an enormous amount of time, not just to complete but in its planning stages – so you won’t get shovel-ready jobs immediately but over time they actually should stimulate the economy. But we may not feel the effects for another 12 months, 18 months out.
Tavis: The flip side of my last question – if I happen to be a Democrat, an Obama supporter, an Obama enthusiast, what I see is the president doing everything he can, but what the polls indicate to me, though, while he’s doing everything he can to turn the economy around the folk who got us in this mess are the same folk who have fought tooth and nail to help keep us in the mess.
They’ve been the party of no, and the polls indicate that they’re the ones who might take over the House and/or the Senate come November. What do you make of that?
Sorkin: Well, that’s going to be the political dynamic that we have coming up here, which is to say – Obama, by the way, was dealt a very bad hand. Let’s just stipulate that from the beginning. The question is, what did he do with the hand? I think it’s not unreasonable to say he didn’t play it as well as he could have. On the other side, we haven’t heard a meaningful plan from the Republicans.
They have been thus far the party of no in many respects, and so the question is can they win on that? At the moment, given the state of the economy, given that when Americans look in their wallet and say there’s less money there, the party of no, it doesn’t even matter of they’re the party of no or the party of yes. The point is that they’re a different party, they’re a different choice.
I think that what you keep hearing is that people want a different choice, and that’s really a result, I think, of the economic situation we’re in today.
Tavis: So you read these polls, it’s not just the American people who are questioning where the President Obama is leading us or not, as it were.
Sorkin: Oh, I say it’s all about the wallet. There have been – you could talk about this whole summer, mistake after mistake from Obama, whether it’s the mosque, whether it’s BP, all of these things – his image, what he says. I don’t think that’s the issue.
I fundamentally think it’s the economy, it’s jobs, it’s looking at your neighbor, saying, “He doesn’t have a job.” It’s looking at your own wallet and your bank account, saying, “I don’t have as much money as I had before.” That’s what people vote on.
Tavis: I saw your piece in the “Times” the other day where you’re suggesting that even Wall Street now is abandoning the president. When I saw that headline I started laughing. I said, “Wait, wait, hold up, wait a minute – these are the folks who he bailed out. He fought to bail them out.” How dare Wall Street turn on the president, Andrew?
Sorkin: Well, first of all, Wall Street historically has not been a fan of Democrats, but in this circumstance actually Wall Street has been a fan of Obama in particular. Many of them voted for him, many of them raised an enormous amount of money for him, and a lot of them feel burned now, less around the policy.
It’s actually less around the fact that they’re going after their tax money or that they’re going after their bonuses. I’m not sure that’s the issue. It’s the rhetoric around business; it’s the villainization of business that so many of these Wall Street folks feel like you know what? I bought into this guy and he’s doing a job on me.
When you really get down to it and you talk to them, when they voted initially it wasn’t on policy. They didn’t look at Obama’s policy. They looked at Obama and they said, “He’s like us. He went to Columbia; he’s an Ivy League grad who was on the Harvard – “
Tavis: But if they’re Ivy League educated and as smart as he is, they can’t at least read that as rhetoric, as populism, as spin, as he has no choice? The polls indicate he’s got to beat us up while he’s giving us money in the back door? They can’t see it that way?
Sorkin: I think they can see it, but I don’t think they appreciate it (laughter) to put a fine point on it.
Tavis: Oh, poor babies.
Sorkin: That’s what the issue is, so.
Tavis: All right. They can’t appreciate it. I’m not going to cry any tears for these guys. Back to your book.
Sorkin: I’m not asking you to.
Tavis: Back to your book, “Too Big to Fail,” now out in paperback. We are approaching the second anniversary of the weekend that changed Wall Street and the industry as we know it. What say you now on the release of this book almost two years later?
Sorkin: Well, it’s been a long two years, and I had always thought that Wall Street would be a very different place. Not just two years later, I thought it would be a different place a year later, and what saddens me more than anything else is that the ethos, the culture of Wall Street fundamentally hasn’t changed.
The sense that greed is good, to quote Gordon Gecko – I know the “Wall Street 2” movie is coming out in a couple weeks – but it really is still there. The bonus culture is still there. What worries me about that is I’m not sure we’re going to have another financial crisis in the next year or two or three years, but down the road I can see this happening all over again.
You’re starting to see Wall Street take more and more risk, put more and more debt atop the problem, and that’s really what frightens me most. And by the way, not just about Wall Street, but this idea of too big to fail used to be just about financial institutions.
Now we’re talking about whole countries. Now we’re talking about Greece and Spain and people are talking about states like California. This problem of too big to fail is much larger.
Tavis: How do the American read all the money that’s being made once again in the financial industry? How do they read that?
Sorkin: I think they read it as something gone completely awry and they say, “How is it possible that we bailed out these guys and now they’re stuffing their pockets and I got nothing in mine?” I think that’s the fundamental disconnect, and that is the problem.
Until we can actually fix that, and I’m not sure we’re going to be able to fix it any time soon, I think we’re going to continue – talk about the rhetoric and the not populism, but the feeling that so many people in this country have around Wall Street, around finance, finance oddly actually serves or should serve an important purpose in this country.
Yet finance and banking turned into a giant casino, and so many people now see it as the casino and not the back room engine of the economy that it’s supposed to be.
Tavis: I’ve got 45 seconds to go, but it’s worth noting before we end this conversation that Wall Street fought tooth and nail, the whole finance industry fought tooth and nail, spent millions of dollars, against this financial regulation that we are told is the way to fix this mess.
So I ask with 30 seconds to go, the debate that’s going on now about the consumer – there’s a consumer regulation department, this new department being created, the politics around that. Is Elizabeth Warren going to get the job? It was her idea, after all.
Sorkin: I will gamble actually that she will. I think that Obama’s going to be in a tough spot if he doesn’t give her the job, in part because Wall Street desperately doesn’t want her to have the job.
Tavis: (Laughs) Exactly.
Sorkin: I think the signal it would send to take anybody else might be the wrong one at this very time.
Tavis: All right, we’ll see whether or not Ms. Warren gets the job or not. The new book – not the new book, out in paperback now, the “New York Times” best-selling book from Andrew Ross Sorkin, you know it well, “Too Big to Fail.” Andrew, thanks for the text. Good to have you back on the show.
Sorkin: Thank you, Tavis, I appreciate it very much.
Tavis: My pleasure.
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