Matt Taibbi

  • Aired:  04/07/14
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"The Divide" author Matt Taibbi attempts to understand how the judicial system can take pride in letting admitted money launderers for narco-terrorists off scot-free. (6:46)

>> Jon: WELCOME BACK.

MY GUEST TONIGHT A BEST SELLINGAUTHOR.

HIS NEW BOOK IS CALLED THEDIVIDE: AMERICAN INJUSTICE

IN THE AGE OF THE WEALTH GAP.

PLEASE WELCOME BACK TO THEPROGRAM MATT TAIBBI.

YOUNG MAN, COME AND SIT, ENJOY.

THANKS FOR BEING HERE.

>> THANK YOU FOUR HAVING ME.

>> Jon: THIS BOOK ISEXCELLENT.

IT'S FASCINATING TO ME.

>> IF YOU SAY SO.

>> Jon: HAVE YOU READ IT?

YOU SHOULD READ IT.

IT'S QUITE GOOD.

IT'S GOT A BEAUTIFUL PICTURE ONIT.

YOU SHOULD READ IT.YOU KNOW,

WE TALK ABOUT THE WEALTH GAP ANDPEOPLE LOOK AT IF FROM A

TAXATION POINT OR AN INCOMEDISTRIBUTION POINT

YOU ARE LOOKING AT IT FROM ALEGAL SYSTEM ELEMENT WHICH IS

A SURPRISING DIRECTION TO TAKEON IT.

WHY THAT TAKE?

>> WELL, LOOK PEOPLE TALK ABOUTTHE INCOME INEQUALITY GAP ALL

THE TIME BUT FOR THE MOST PARTWHEN POLITICIANS TALK ABOUT IT'S

JUST A STATISTIC. BUT WHAT I'VEFOUND IS THAT THERE'S THIS

PROFOUND DIFFERENCE INTHE WAY WE PROSECUTE CRIME

FOR THE VERY WEALTHY, ANDPARTICULARLY THESE PEOPLE IN

THESE TOO BIG TOO FAIL EVILBANKS THAT WE ALWAYS TALK

ABOUT. AND THEN EVERYBODY ELSE.

THERE'S THIS ENORMOUS DELTA ANDWE NEVER TALK ABOUT IT.

THIS IS WHAT I WANTED TO DO INTHIS BOOK IS JUST TALK ABOUT

THIS.

THIS REALLY GREW OUT OF MYEXPERIENCE COVERING FINANCIAL

CRIME FOR YEARS AND YEARS ANDYEARS.

WHEN I STARTED I DIDN'T KNOWANYTHING.

I COULDN'T EVEN BALANCE MY OWNCHECKBOOK.

>> Jon: NOT A CRIME.

>> NOT A CRIME, NO.

>> Jon: FROM WHAT IUNDERSTAND.

>> IT TOOK ME A WHILE TOUNDERSTAND.

I TRIED TO READ ALL THESE BOOKS,THE WEALTH OF NATIONS, ECONOMIC

TEXT BOOKS.

IT WASN'T UNTIL I READ LIKE ALITTLE THING THAT WAS LIKE THE

GREAT CONMEN IN HISTORYTHAT I -- IT DAWNED ON

ME IT'S JUST STEALING. THAT'SALL THIS IS. IT'S JUSTSTEALING.

>> Jon: THERE'S A CERTAINAMOUNT OF STEALING THAT APPEARS

TO BE BUILT INTO THE SYSTEM ASAN ACCEPTABLE VIG FOR THE

GOOD THAT THEY DO, THE WEALTHTHAT THEY SPREAD.

>> BUT THERE IS NO -- AGAIN,THAT'S THE ILLUSION.

THERE'S NO GREATER GOOD.

THIS IS JUST TAKING STUFF FROMPEOPLE.

THE SUBPRIME MORTGAGE CRISIS ALLIT WAS WAS BANKS ROBBING OLD

LADIES.

IT WAS THE SAME THING.

YOU MIGHT HEAR ABOUT PEOPLE WHOCALL UP THE ELDERLY AND TRY TO

SELL THEM PHONY SUBSCRIPTIONSOVER THE TELEPHONE.

>> Jon: CORRECT.

>> THE SUBPRIME MORTGAGE THINGWAS THE SAME THING.

PHONY MORTGAGES. THEY WERESELLING IT TO PENSION FUNDS AND

THEY WERE RIPPING PEOPLE OFF.

>> Jon: THIS GETS US TO THEGREAT PREMISE IN THE

BOOK WHICH IS, IF THE OLD LADY.

IF YOUR GRANDMOTHER WENT INTO ABANK AND RIPPED THEM OFF.

SAID GIVE ME YOUR MONEY AND THEYGAVE IT TO HER AND SHE WALKED

OUT CHANCES ARE THAT WOULDCARRY A CRIMINAL PENALTY?

>> ABSOLUTELY, YES.

>> FOR SOME REASON THE WHITECOLLAR RIPOFF HAS BEEN

DECRIMINALIZED TO SOMEEXTENT EXCEPT FOR FINES.

>> EXACTLY.

>> Jon: AND NOT ON THEINDIVIDUAL BASIS BUT ON THE

LARGER CORPORATE LEVEL.

>> RIGHT, AND THIS IS WHAT I WASREALLY TRYING TO GET TO IN

THE BOOK. THERE'S THIS REALLYKIND OF SCARY PSYCHOLOGICAL

MOMENT THAT WE'VE CROSSED INAMERICA WHERE WE NO

LONGER THINK OF A CERTAIN KINDOF OFFENDER AS APPROPRIATE FOR

JAIL. I HAD THIS REALLYEYE-OPENING --

[ LAUGHTER ]>> Jon: THAT'S SUCH A GREAT

PHRASE THIS MAN IS NOTAPPROPRIATE FOR JAIL.

>> I'VE HEARD THAT SAID TO MEHONESTLY.

I WAS TALKING TO A FEDERALPROSECUTOR A FEW YEARS AGO AND I

SAID LOOK THESE PEOPLE STOLE ABILLION DOLLARS.

I WAS TALKING ABOUT THIS BANK.

HOW ARE THESE GUYS NOT JAIL? HOWDOES THAT MAKE ANY SENSE?

AND HE SAYS TO ME, HAVE YOU BEENTO A JAIL?

JAILS ARE DANGEROUS.

[ LAUGHTER ]PEOPLE GET STABBED IN JAIL.

>> Jon: YEAH.

>> I'M LIKE I'M NOT DISAGREEINGWITH YOU BUT THERE'S TWO

AND A HALF MILLION OTHERPEOPLE WHO ARE ALSO IN THAT

SAME PLACE AND THEY DID

A LOT LESS THAN STEAL A COUPLEOF BILLION DOLLARS, AND IT'S A

PSYCHOLOGICAL THING WHERE ITHINK MEMBERS OF A CERTAIN CLASS

JUST DO NOT SEE PEOPLEWHO RUN BANKS AND WHO

HAVE TIES AND DRIVE MASERATIS.

>> Jon: THESE ARE NOT BADPEOPLE.

THESE ARE GOOD PEOPLE WHO AREJUST TAKING ADVANTAGE OF

RULES THAT MAYBE THEY ALSOWROTE BUT STILL.

>> EXACTLY.

EXACTLY.

>> Jon: IT'S NOT SOMETHINGTHAT IS CRIMINAL.

BUT EVEN WHEN IT CLEARS INTO ANAREA THAT IS SO MORE CLEARLY

CRIMINAL.

I THINK THE HSBC CASE IS THEGREAT EXAMPLE OF THIS.

THEY ADMITTED TO LAUNDERINGMONEY FOR NARCO TERRORISTS.

>> RIGHT, RIGHT.

$850 MILLION.

>> Jon: AND THEY SAID, YES.

>> OH, YOU GOT US.

>> Jon: WE DID DO THAT.

>> WE DID DO THAT.

>> Jon: AND THEIR PENALTY WASWHAT?

>> THEY GOT A COMPLETE AND TOTALWALK. IT WAS A DEFERRED

PROSECUTION AGREEMENT. NOT ONEPERSON DID ONE DAY IN JAIL.

NO INDIVIDUAL TO HAD TO PAY ANYFINES.

THERE WAS A COMPANY FINE OF $1.9BILLION WHICH WAS AT THE TIME A

RECORD.

THAT VERY SAME DAY WHEN THEYMADE THAT ANNOUNCEMENT AND THE

JUSTICE DEPARTMENT WAS VERYPROUD AFTER THIS DEAL.

IT WASN'T LIKE WE DIDN'T GET ANYJAIL TIME FOR THESE GUYS THEY

WERE LIKE WE GOT $1.9 BILLION.

AREN'T WE AWESOME?

I WENT DOWN TO THE COURTS THATDAY AND ASKED AROUND ASKING WHAT

IS THE DUMBEST DRUG CASE YOU'VEHAD TODAY?

THEY FOUND A GUY FOR ME THAT HADBEEN CAUGHT WALKING DOWN

THE STREET WITH A JOINT IN HIS

POCKET WHO GOT 47 DAYS ATRIKERS.

THAT'S WORSE THAN ANYTHING THATHAPPENED TO ANYBODY AT HSBC AND

THEY ARE AT THE TOP OFTHE ILLEGAL DRUGS PYRAMID.

AND THIS GUY IS AT THE BOTTOMAND HE'S DOING A MUCH MORE

SEVERE SENTENCE. THAT JUSTCAN'T BE RIGHT.

THERE'S NO WAY TO LOOK AT THATAND HAVE THAT BE RIGHT.

>> Jon: NO AND WHAT I THOUGHT ISVERY INTERESTING ABOUT THE BOOK

IS YOU TIE -- THIS ISSYSTEMIC FROM THE TOP,

FROM THE HEAD LEGAL AUTHORITY INTHIS COUNTRY, ERIC

HOLDER AT THEDEPARTMENT OF JUSTICE.

THIS IS NOT A BUG IN THE SYSTEMTHIS IS A FEATURE OF THE SYSTEM.

>> RIGHT, THIS IS A -- THAT'SEXACTLY WHAT IT IS.

ERIC HOLDER WAY BACK IN THECLINTON YEARS WHEN HE WAS JUST

A REGULAR JUSTICE DEPARTMENTOFFICIAL, HE WROTE THIS MEMO

AND IT'S COME TO BE KNOWN AS THEHOLDER MEMO.

HE OUTLINED THIS POLICY CALLEDTHE COLLATERAL CONSEQUENCES

POLICY. AND WHAT THAT BASICALLY MEANS IS

IF DEALING WITH A BIG COMPANYTHAT EMPLOYS A LOT OF PEOPLE AND

IF YOU PROSECUTE IT, BAD THINGSMIGHT HAPPEN TO INNOCENT PEOPLE.

YOU CAN SEEK OTHER REMEDIES, YOUCAN DO FINES, DEFERRED

PROSECUTION AGREEMENTS.

YOU DON'T HAVE TO WRECK THEWHOLE THING IF GOING TO DO THAT.

>> Jon: SURE.

>> THAT'S SENSIBLE. YOUDON'T WANT TO DESTROY A COMPANY

JUST BECAUSE A FEW BAD APPLES OFTHE COMPANY MAY HAVE

>> Jon: MAY HAVE LAUNDEREDNARCO TERRORIST MONEY.

EXACTLY.

>> YEAH IN THE CASE OF ENRONTHEY MAY HAVE SHREDDED TWO TONS

OF DOCUMENTS.

>> BUT, IT HAPPENS.

>> Jon: BUT IT HAPPENS IT'S AMESSAGE ON THAT KID WITH THE

JOINT IN HIS POCKET IT SAYS TOHIM, GO BIG OR GO HOME.

>> RIGHT. RIGHT.

STICK AROUND FOR A LITTLE BIT.

THE DIVIDE IS ON THE BOOKSHELVESNOW.

WE'LL HAVE A LITTLE MORE WITHMATT TAIBBI RIGHT AFTER THIS ON

THE INTERNETS, I THINK.

YES.

WE'LL DO IT.

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