PERSPECTIVES ON THE PANDEMIC VIII:

A Conversation with Matt Stoller, Author of Goliath: The 100-Year War Between Monopoly Power and Democracy

Washington, D.C., May 7th, 2020



[00:00:33.03] JOHN KIRBY: So, Matt, if you could just tell us your name, and a little bit

about your background?

[00:00:36.17] MATT STOLLER: Yes, my name is Matt Stoller. And I am a writer. And

I am the director of research at a think tank called the American Economic Liberties Project. I just wrote a book Called, Goliath: The 100-Year War between Monopoly Power and Democracy, in which I go over the history of concentrated financial power and our political system from beginning of the 20th century to right up until the financial crisis and the rise of big tech. I have a background working in policy in Congress. I worked in the Senate, I also worked in the House of Representatives. And there we go.

[00:01:14.10] KIRBY: So, you wrote in your book, Goliath: The 100-Year War between

Monopoly Power and Democracy that the bailouts from 2008 to 2010 were not intended to stop a depression; they were intended to stop a New Deal. What did you mean by that? Are we seeing something similar with the pandemic bailouts?

[00:01:32.11] STOLLER: Yes. So, the New Deal was a number of different things rolled

into a set of policy programs. The most important part of the New Deal was restructuring the social hierarchy in power in America. So, FDR, in 1932, talked about how he was seeking the “moneychangers in the temple,” which had been running the country. This was the metaphor for JP Morgan and National City, which was Citibank, just the financiers that had been running America. They had fled, is what he had said, and that they had no vision, and where there is no vision, the people perish.


[00:02:11.03] What they did in the New Deal is they, at first, they passed a bunch of laws,

banking rules, laws, security laws, rules to eliminate the power of these financial, these private financiers over the American political economy, over American politics, over American industry. Then, they expanded government and engaged in a series of policy maneuvers to create competition in markets to undermine monopolies, to unionize industrial companies, to basically create a set of public institutions that could bring democracy into the industrial era. What Brandeis called industrial democracy. That is the opposite of what happened in 2008.

[00:02:57.24] So, in 2008, faced with money changers who had fled, the bankers who had

been in charge of the political economy had all frozen up. And what Bush, and then what Obama, what Bush did, and Obama continued, was just reinforcing the power of these money changers, bailing them out, but also demanding no structural reforms in how they ultimately operated. And so, you saw in the New Deal the economy came back and grew bigger than it was before, but it great along egalitarian lines. It was a unionized country; it was a country where there were small stores and farmers and, you know, I don't want to overly romanticize it, but it was a middle-class country.


[00:03:42.12] After the financial crisis of 2008, ‘09, and ‘10, it was not. It was a much

more unequal country, even though it was a progressive democrat who was the president. So, in this pandemic, what we're seeing is not quite the same thing. Because the pandemic is not a problem in Wall Street that spidered out into the rest of the economy, it's a disease that hit the rest of the economy and that problem is spidering into wall street. But largely the philosophy of neoliberalism, the philosophy which says that people with great financial power, private actors, that they rule, that they should run things, that they know what's best. That philosophy is still dominant.


[00:04:21.10] Our policymakers, really in the heart of the people as well, we still believe

that. We're afraid to actually govern ourselves. And so, what you're seeing is massive support for large corporations, massive support for private equity funds, for monopolies and modest support for small businesses, modest support for people who are unemployed, and so you're going to see incredible consolidation. More consolidation, a lot of small businesses going under and a much more concentrated economic and political structure.



[00:04:51.21] KIRBY: So, when you appeared on Democracy Now after the passage of

the first stimulus package, you called this “a total system failure.” Have your fears about the nature of the bill been born out? Let's start out with what the actual amount of the package is, and where that money is going.

[00:05:05.15] STOLLER: Yeah. So, the package was, essentially, a—there’s no way to

really know the amount, because it's essentially a guarantee of liability. It's a guarantee of loans, so the Fed just has the ability to lend out trillions of dollars. And they don't have to lend out trillions of dollars, but they could. They could lose some of that money, they may not lose that money. So the way you do government budgeting, you don't really know how much it's going to, sort of "cost" for a few years. And even in places where the Fed doesn't appear to act, like, for example, the bond market, the Fed could just announce, "we are going to buy some corporate-grade bonds," and the prices in those markets change dramatically, without the Fed having to do anything - they just announce they're going to do something.

[00:05:51.07] And so it's—that doesn't go on the government's balance sheet, the Fed

announcing that they're going to buy bonds and all those bond prices changing. Really that's an implicit subsidy to people that are borrowing in that market, it just doesn't go on the government balance sheet. So, looking at overall cost of the bill is not the right way to evaluate it. A better way to evaluate it is to look at what big corporations are doing with the money that they have gotten. So, Boeing, for example, was on the ropes, mostly because they were making planes that crashed, and so they couldn’t sell planes, and they were having really serious problems. Also, their spacecraft that they were selling to the government were not working—they were having huge problems. And then this pandemic made things much worse. So, what do they do?


[00:06:33.02] They needed a bailout, but they didn't officially take government money that

was in the CARES Act that congress appropriated, because that would have required them to maintain their payroll. Instead, they took an indirect implicit bailout from the Fed by borrowing a bunch of money in the capital markets and those capital markets had been stabilized by the Fed. The Fed said, “We're going to buy bonds. We may buy bonds that are from companies like Boeing”. So, investors knew, “Oh, well there's no real risk buying these Boeing bonds. We're going to lend Boeing money because the Fed has our back, if necessary.” So, Boeing got 25 billion dollars at a lower than market interest rate, and they engaged in massive layoffs, and their executives are still very highly paid.


[00:07:17.13] This is also true with General Electric, which is a big aerospace industry.

Massive layoffs and continuing to pay high salaries to their executives. But it's also across the board. You see this with Carnival Cruise Lines (which got a massive bailout from the Federal Reserve, you know), estimates roughly a three billion dollar subsidy, who knows, give or take, but Hertz rent a car—on and on and on. What you're seeing is a solidification of power in the hands of bond holders, stock holders, and the executive class, and then massive layoffs of people that work for a living and then the decline in power of small businesses, who have to rely on much more rickety structures like the, what's called the Paycheck Protection Act, which is a smaller program in the bill that doesn't work quite as well. And that's supposed to support small manufacturers, and restaurants, and retail outlets, and that’s not working that well. It's working, but it's not working that well. It's slow. The other stuff is instant, massive, frictionless, no strings.

[00:08:24.21] KIRBY: Now, can you make the distinction between the Federal Reserve,

which my understanding is neither Federal nor reserve, and what the, say, the Treasury Department or what Congress is doing. How are those two things related?

[00:08:39.08] STOLLER: So, it's a good, it's a really important question and super, super

weird, because when you get into the guts of how money works, it's interesting, but you can also sort of go crazy. The Federal Reserve, what they do is they print money, and they choose, they basically choose how much money exists in the economy, by either going into certain capital markets where banks and corporations lend and borrow or by regulating banks and telling them what they can and can't lend. So, the terms by which you take out credit cards or mortgages or that corporations borrow, those are set by the Federal Reserve. It's a sort of indirect way to control the economy. And the Fed likes to think of themselves as politically neutral, saying, "Oh, well, we're just kind of moving more or less money into the overall economy, but we're not picking winners and losers. We're more technicians, we're dentists, we're not political actors." That's, of course, not true. They are making distributional choices, but that's the way that they see it. They set the terms and conditions of credit allocations. That's called monetary policy.


[00:09:52.09] Congress does what's called fiscal policy, which is to say, they deliberately

and explicitly set winners and losers. They choose to spend money on things, government money on things, or not spend government money on things. They choose to put money into the Pentagon or into health services or into, you know, roads or whatever it is that they choose and there, they just buy things directly. They're not lending money, they're not borrowing money, they're just directly spending money or taxing. So, those are the two different - one is monetary policy, one is fiscal policy.


[00:10:27.15] And Congress is elected, and they have traditional oversight roles, they do,

every year, they do authorization and appropriation, and budget choices over all of these programs, whereas the Federal Reserve is not elected; it's sort of this strange—they call it "independent" but their governors are appointed for 14 year terms so they try to kind of—they are a lot less accountable to the public directly. They more kind of talk to Wall Street and figure out what's going on in the credit markets. And they like to keep themselves what they call "independent of politics". It's not really independent of politics. It's just independent of voters.

[00:11:10.16] KIRBY: So, when they talk about a two trillion-dollar stimulus package,

where is that money coming from, and who is it going to, and is it really two trillion? I know you're saying there's some unknowns, but we saw that Kudlow, early on, came out and said it's going to be more like six trillion, you were saying on Democracy Now it's going to be more like 10 trillion—and again, this is unknowable—but where is that money actually coming from? Is it just being printed? I mean, how is that—how is that working?

[00:11:37.06] STOLLER: Yeah, it's being created. Money is just an arbitrary political

commodity. It's kind of like, where do the strikes from a bowling alley come from? You just make 'em up, right? Money is just accounting, so you can make it up, and we have institutions to make it up. The Fed does that—it’s the accounting system for the economy. So, when Charlie Gasparino, I think he's on Fox Business News, or he was on CNBC, he said that the rumor on Wall Street, it was going to be 10 trillion dollars. Kudlow talked about how it was six trillion dollars. In Congress they were debating that it was, saying, it was two trillion dollars, but it just depends on how you calculate it, because Citibank has about a trillion or two trillion dollars of liabilities, or bank debt. So, they borrow a bunch of money and then they lend a bunch of money, and those two things basically match.


[00:12:31.23] With all the money they borrow, those are called liabilities. One of the things

in the bill is it said that the government is going to guarantee all of those liabilities, through the Federal Deposit Insurance Corporation. Is that a trillion dollars, if they're guaranteeing Citibank's trillion dollars of liabilities? Maybe. Maybe it's nothing, because maybe those liabilities are not going to cost anything, it's going to be fine. So, a lot of this is just kind of like, when you get into economy, when you get into trillions, you're not really talking about, sort of, traditional thoughts about spending or borrowing money, you're really just talking about broad accounting for broad reshaping of social power.

[00:13:10.09] KIRBY: Will any of this translate into federal debt? Will this translate into

debt that taxpayers in any way are responsible for?

[00:13:19.03] STOLLER: It will translate into Federal debt, but Federal debt is also, you

know, that's a way of printing money, right? So, if you own a treasury bond, you own a $50 bond or treasury bill, yeah, technically that's government debt, but for you it's an asset. When you have a dollar bill in your wallet, you think you have something that's valuable, that's an asset. It's also government debt. So, when we're talking about—people confuse this accounting system with wealth. Money isn't necessarily wealth, it can be a store of wealth. Government debt isn't necessarily something that you owe, it can also be a store of a monetary—it’s a store of monetary assets. Real wealth are actually things that people want and need, right? So, you can print money, but you can't print personal protective equipment, right? You can't print medicine. You can't print a vaccine. That's real wealth.

[00:14:20.13] We shouldn't—we can't confuse accounting systems with actual wealth. And

in America, one of the things that's happened since the 1970’s is we've gotten really financially oriented. Like, we think only in terms of consumerism and finance. We don't think about the essence of real wealth which is the ability to make the things that you need. So, the factories all went off to China and we were like, "It's fine. We're super wealthy because look at all of these! Look at our bank accounts. Look at these spreadsheets that have all these zeroes on them." But when push comes to shove, who has the ability to make the things that they need? In this case, it was China, it wasn't the United States. We didn't print our way to all of those tanks in World War II. That didn't come from the Federal Reserve. The Federal Reserve had its role in just printing as much money as we needed, but fundamentally, the tanks, the arsenal of democracy, all of that came from factories and from people, and from mines and forests and resources, and that's what actual wealth is.

[00:15:27.05] KIRBY: That brings to mind that distinction between the real economy and

this, kind of, this floating financial economy. We've heard a lot of people say that there was actually—I mean, maybe you could call it “a perpetual bubble”—but that there was another bubble that was happening that a lot of these companies, like Boeing, were in a lot of trouble already and that, you know, this came—it could have come later, it could have come earlier, but it came at a perfect time.

[00:15:55.27] STOLLER: I think you could argue that there were large swaths of the

economy that had too much debt. You know, private equity is a kind of financial model which involves buying a company and then having that company borrow a bunch of money and then take that money and give it to the private equity owners. It's kind of like the mafia, where you own a restaurant and you know, you burn it down for the insurance money. That's a little bit like what private equity is. As long as you can get someone to lend you money, or to ensure whatever asset you have, you can—you don't care what happens to the underlying asset, since you can collect the cash yourself. That's what a big swath of the economy is doing, about five to six trillion dollars in aggregate.


[00:16:40.18] The total stock market value is about 30 trillion dollars. That's bad. I mean,

you see a lot of the retail bankruptcies that are happening in the pandemic. Those were going to happen anyway. You saw it starting with Toys “R” Us, and that's isn't because of Amazon. A lot of these companies were doing just fine. It's just that then they were bought by private equity companies that just wanted them so that they could borrow a bunch of money, and then pay out huge dividends, and they didn't manage the stores. So, you'd go to JC Penny or you'd go to Toys “R” Us, and it was a crappy experience, because they weren’t being managed. They were just vessels for their financiers to loot them. And a lot of them are going bankrupt now during the pandemic and people are saying "Oh it's the pandemic." It's not really the pandemic. They were badly managed.


[00:17:26.01] But do I think there was a broad economy-wide bubble like 2008? I don't

think that was happening. But what I do think is happening in this pandemic is a complete and weird severing of the relationship between finance and underlying economic activity. So, even in 2008 and ‘09, when things were going really badly, and that was financial crisis spidering out into the real economy, take Carnival Cruise Lines. Even though Carnival Cruise Lines' stock price was being hit, and there were all sorts of problems in 2008 and ‘09, they were still a cruise line company; there were still people taking cruises, they were still generating income, so you could still sort of value what they were doing, even if you didn't quite know what the value was, because financial world was going crazy. They were still a cruise company. They could sell a product.


[00:18:20.26] Today, Carnival Cruise Line, how do you value that? There's no underlying

economic activity, so when they sell bonds, or they sell, you know, they have a stock that's trading, it's purely a guess that, maybe, at one point in the future, Carnival Cruise Lines might generate income at some point. And we have no idea whether it will. And that's true for airlines. It's true of like, a whole swatch of the economy. There's just no underlying economic activity. And what the Fed is doing, is they're kind of creating a puppet show. Like, people are issuing stocks and bonds, and they're trading them, as if they represent some sort of economic activity, but they don't. And it's incredibly weird. So, is that a bubble? It's something much weirder than a bubble but related in that a bubble is when financial values divorce from the real economic underlying value of the asset.


[00:19:20.21] In this case, you do see that skew, but it's impossible to know what that

underlying economic value is, because there's no underlying economic activity. So, a different way to think about it is that we're in a planned economy. This isn't a market economy anymore, or a capitalist economy. This is just a planned economy, where the Fed is just saying, "We're just going to choose to make sure that these people who own equity and debt, that that means something. That these executives, they have a certain amount of assets, we're just going to decree it, based on the Fed and treasury and our political choices, and it has nothing to do with whether there's any actual underlying customers or anything like that. We're just going to decree it." So, it's a planned economy, and that's really what the CARES Act represented, and what all of these subsequent bills represent. We're just in a planned economy where we're just making social choices purely through congress and the Fed, and our political system.

[00:20:21.05] KIRBY: You are a registered democrat, from what I understand. You were

extremely upset, in particular, with the progressive wing of the Democratic Party, after the passage of the first CARES Act. Why were you upset with them? Why were they to blame for anything that happened?

[00:20:36.22] STOLLER: Well, you know, my general observation -- so I've been in

progressive politics for about 15 years, and I've—there’s a number of different strategies that progressives have pursued to try to make a more equitable, just world, but what I realized after starting to learn about finance and corporate power, and monopolies, is that, fundamentally, progressives just don't seem interested in power. They just don't seem interested in finance. They don't seem to care about the details of corporate power.


[00:21:05.26] So, often progressives will say to me, I'll be like, "I think we should use

antitrust to break up big companies, because that's a problem. We have these big companies that are dominant." And progressives, or lefties, will come to me and say, "I don't agree with you. I want to support workers." And it's just weird, because it's like I'm saying, “Hey, those are the bad guys that are structuring an inequitable society. Like a billionaire is somebody that has too much power, and we should—they have power, but we don't have power. Because they have power, workers don't have power, because they have power, and I want to go after—I want to use our politics to restructure that power arrangement.” And progressives are like, “Those things aren't related." And it's really bizarre.


[00:21:49.08] So, when I saw what the CARES Act was, a lot of stuff that was

happening —they mimicked a lot of the policy choices of 2008. It was a different situation, but a lot of the technical specs were the same, in terms of the bill. And a number of us, my nonprofit, but in a number of other people who had experienced 2008 were saying loudly and telling allies who were progressives, "Don't let them move money through the Fed into the stock market, because it will bail out the wealthy and the rest of us will get screwed." And progressives were just not paying attention, and they were just like, "But we need to help people! We need to get unemployment out there!" And they just voted for it 96-0 in the Senate, they didn't even bother to do a roll call in the House. They had a week and a half, they didn't organize. They didn't give any speeches. They didn't come up with any credible alternates. They were just irrelevant, because they weren't paying attention.

[00:22:48.02] Three weeks later, three weeks after the CARES Act passed, there's a

congresswoman named Rashida Tlaib, who I originally liked, who's a progressive from, I think, the Detroit area, but there was this guy on CNBC, a billionaire named Chamath, who is this, I think he runs something called Social Capital Investments, and he gave this inspiring comment, or sort of a speech, but he argued with a CNBC anchor about whether to allow airlines to go bankrupt or not. And he said they should go bankrupt, because who cares if the stockholders and debt holders get wiped out. They should get wiped out. That's the essence of risk. He had said something similar before the CARES Act passed. But basically, what he was saying is, “Wipe out the wealthy. Why are we preserving their capital? They didn't - it's valueless unless we chose to give it value. Why are we doing this?”

[00:23:45.05] And I noticed it went sort of viral. And a number of progressives, including

congresswoman Tlaib said, "Absolutely. Why are we bailing out the powerful when the rest of us are suffering?" And it was—I was really horrified, because she didn't notice that she had voted for this massive corporate bailout until a billionaire on CNBC told her, three weeks after she had voted for it. And I think that, to me, says it all about progressives, and this progressive movement that I had thought I was a part of. They're just not serious. They don't actually want to govern. What they want to do is be told how to think by powerful people, and then, in the meantime, they want to have the right aesthetic choices about justice. So, I look at them and I think, at this point, I'm just like, "Oh you guys are not actually doing politics. You're just art critics, and you just, you know, and then you will say something when a billionaire on CNBC tells you to, but that's not a serious, that's not a serious political move. That's not politics. That's art criticism."

[00:24:58.28] KIRBY: Where was Bernie on all of this?

[00:25:01.13] STOLLER: Bernie was pretty dishonest. He was quiet for most of it –

didn't notice or didn't care. Or both. I think some of his, you know, I talked to a lot of people, insiders in politics, and in the progressive world, and a lot of them, at a staff level, a lot of them knew. I think at a member level, some of them knew, but they didn't say anything. I don't know if Bernie knew or not. At the very last minute—and I think Chuck Schumer and Bernie and Warren were all working together with progressives to move this bill through—there was an unemployment provision that made sure that people got an extra $600, or up to $600 more than they ordinarily would have on unemployment insurance. And it's something that the republicans and democrats both wanted because republicans are not stupid, and they want to get reelected. And Bernie pretended that he was responsible for this, which was nonsense. He was not involved in the negotiations, in any meaningful way.


[00:26:00.11] At the very last minute, three republicans—and remember, the

republicans, for about week and a half before the bill, had been attacking the Democrats for holding up the bill, saying, "This is essential to get this through." They were trying to jam this corporate bailout through, and saying, "If you don't want this bailout, then you are going to be murdering people. Because hospitals need the money, and you're going to let people die on the street, and you're going to let people starve without unemployment." And they'd been saying this for a week and a half, and the democrats weren't saying anything back. They were just saying, "Don't worry, we're negotiating. We'll get this through," right?


[00:26:29.01] And the very last minute, three republicans, Lindsay Graham, Rick Scott,

and someone else, say, "Actually, what we've decided is that this bill doesn't mean enough to poor people, and we want to do something and get rid of some of this unemployment." And, of course, this wasn't going to go anywhere. Everybody knew the bill was locked and ready to go. It had been negotiated and agreed upon. And there were only three republican Senators who were opposed to it. They could have delayed it, but they couldn't have stopped it. So, they cut a deal, and they said, "We just want to vote on a meaningless amendment that would remove some of this unemployment benefits, which we know isn't going to pass," because they would have needed 60 votes, and they didn't have 60 votes. So, they talked about how this bill doesn't mean enough to poor people.


[00:27:15.14] And Bernie gets up on the floor and says, "We absolutely have to save

unemployment insurance." And he gives this rousing speech against this amendment, and for the bill, as structured, right, which is this giant Wall Street bail out, and he says, "We need to save this giant Wall Street bail out because it has some unemployment insurance in there." And that speech was completely dishonest, because what he was trying to say is, he was helping to preserve unemployment insurance, which was not true. It was completely symbolic and meaningless and irrelevant. And a lot of his supporters were just enthused, because they didn't understand what was going on, and they just thought that Bernie was standing up for them, and unemployment insurance.


[00:27:58.18] And three weeks later, four weeks later, a month and a half later, people

are saying, "How come all of these powerful wealthy people are getting bailed out and have all of this—don’t have any problems and we're getting screwed?" And they're really upset and confused, and it's because there was no leadership at the time the decision was being made. And they were misled by Bernie, and they were misled by their leaders. And that, to me, was just appalling. Up until then, I had been trying to figure out [who I supported]; like, I liked, Warren, but then I moved to Bernie, because I thought he was running a better campaign; and I was kind of more on the, like, progressive side in the primary. But at that moment when Warren—because Warren was not a good actor here, either. When Warren and Bernie both finished their presidential campaigns by losing, and then by supporting this Wall Street bail out—and both of them started, basically, because of the original unfairness of those original bailouts—to me, it was very disillusioning. And it was very much like, "Oh, this is not a serious political movement. This is just-- seems to be that these are people that just kind of want to be friends with Chuck Schumer. Or they want to be friends with, like...." I don't know. That was disillusioning to me. And now I’m looking for another strategy for how to create a more resilient and fair society.

[00:29:17.20] KIRBY: The tendency towards monopoly and the chaining of America, if

you will, which you talk about in your book, was well under way before the pandemic. What has been happening as a result of the lockdowns, here and around the world? It seems to me to have only mightily accelerated that process.

[00:29:36.06] STOLLER: Well, yeah. So, we've been concentrating power in the hands

of monopolists and financiers since the late 1970's. So, the New Deal, we really did break up the financial holding companies that were controlling the country -- The Mellons, the Morgans, the DuPonts, the Rockefellers. And we had a middle-class country up until the late 1970's. Obviously, there were huge inequities, racial inequities, gender inequities - but economically, it was getting more equal over time. And it was laying the predicate for a lot of social movements to address some of those inequities. But starting in the late 70's and really early '80's, and when it started accelerating, the Reagan administration got rid of anti-trust enforcement, and you started to see this massive roll up of power. You saw a lot of chain stores explode, and then you roll that forward.


[00:30:23.29] Clinton doubled-down on it, globalized it. You roll it forward 30, 40 years,

and you have a world of Walmarts, and Amazons, and Googles, and JP Morgans that are just enormously powerful institutions. And in many ways, these are now public infrastructure. They're not governed like public infrastructure, but they are public infrastructure. People are dependent on Amazon in a way that makes it almost a government-like facility. They're—you know, Facebook just set up a supreme court for content, you know, for speech regulation. They have a global super court for censors. That's something that a political system does, not just a corporation. The reason these guys are political systems is because they're monopolies, and a monopoly has control over a market. It sets the terms and services under which people operate in that market. It's a mini government. So, we have all of these governments everywhere which provide vital public infrastructure that we depend on.


[00:31:18.19] In this pandemic, one of the things that's happening is some of the

alternatives, the mild smaller alternatives to some of this vital public infrastructure, the stores, the smaller businesses, about 40% of them are likely to go out of business, because they haven't gotten the support that they need. And so, you're seeing a lot more dependence on some of the bigger guys, like Amazon's sales spiked 24% in the first quarter, and you know, Neiman Marcus just declared bankruptcy and you know, a whole bunch of department stores are declaring bankruptcy, not to mention huge numbers of independent retail stores are closed. And so, a lot of people that made products, or that distributed products, who were trying to avoid Amazon or who could play Amazon off against their other distribution channels, now can't, and are entirely dependent on Amazon. And that's true, you know, across the economy in a lot of different areas.


[00:32:13.11] And so, it's really dangerous. You're also seeing a lot of people, a lot of

corporations, are now in destressed situations. So, they need cash because they're just not getting any income and they need to find a way to borrow. And so, you have these vast pools of cash which are private equity funds. They're essentially predatory lenders, but to corporations, and they're going and they're lending on really onerous terms to everyone from small businesses to businesses that are, like the Cheescake Factory just took out a 200 million dollar loan, and they probably had to give up a bunch of their company for that loan, and so this is a moment when the distressed assets have to—they have to give up power and control to people with access to capital, which are usually people who are politically connected, right? So, it's a consolidation of economic and political power.

[00:33:07.08] KIRBY: So, when Cramer said, weeks ago, now, that we could come out

at the end of this and there would just be Amazon Walmart, and Costco-

[00:33:17.14] STOLLER: Three retailers, right.

[00:33:18.18] KIRBY: Three retailers. Is that looking like it could happen? Something

like it?

[00:33:23.18] STOLLER: Something like it. I mean, unlikely that it will just be three,

but yeah, I mean, we could have just a very small number of retailers. A whole bunch of supply chains might collapse, you know. There's only one book distributor now, so if independent book stores go under, and there's no more distributor, then that's it, there's just Amazon, and that could be true in lots of different areas. You know all the movie theater chains, they could go under, maybe Amazon could buy one of them. Like, what you'll see is effectively, kind of the end of any sort of independence in Hollywood. So, you could see—and you know, there are other parts of our political economy where that might be true as well.


[00:34:05.03] So, you’ve got to look at this moment and say, “We could choose, since

we're in a planned economy, we can choose what kinds of planning we want to do.” And I think that there is starting to be a debate about that, right, and it's taking place now, where people are saying, "Hey, maybe we should have, say, a merger ban.” So, David Cicilline, who is a chair of the Antitrust Subcommittee in Congress, is pushing that. Elizabeth Warren and Josh Hawley are pushing for elevated antitrust scrutiny. And I think that Marco Rubio's Paycheck Protection Program really did help support some small businesses. What we might see—you know, you're also seeing republicans starting to talk about reshoring supply chains, pharmaceuticals, back from China. So, there is the opportunity to deploy public resources to build out new industries and to actually decentralize industries, it's just we have to do it through our political system. And that means we have to relearn the art of politics.

[00:35:04.08] KIRBY: You just mentioned decentralization. Let me just ask you, what

are your thoughts? Is that the ultimate answer, and how do we push for decentralization in our political economy?

[00:35:15.10] STOLLER: Yeah, I mean, the ultimate answer is a free self-governing

people, so it's liberty. And a political, a society, that can be resilient, that can make the things that we need, and that can take care of human needs. So, you know, one of the reason you want to decentralize power is because it is more resilient and it is freer, and it does allow us to govern ourselves, whereas if you're under the thumb of one guy, you know, then that guy's decisions hold, and you don't really have any choices, and that's not a free society. it's also a more brittle society, because that guy usually puts—that’s putting all your eggs in one basket, right? So, you know, as we're seeing where we can't get important supplies from China, it's because we put all our eggs in the China basket.


[00:36:05.08] So, how do you decentralize? I mean, you do what you did in during the

New Deal; we've done it at other periods in American history. We did it during the Civil War, and right after the Civil War, with the Homestead act; I mean, what you've got to do is—we did it the Revolutionary War, there were people who made that case, we did that in the early 19 teens what—a revolutionary era congressman named William Finley said it, it was an anticorruption measure, but it was also about property. He said, "Wealth in many hands is many checks." Right? It's the yeoman farmer idea, where what you're doing is, you're distributing a little bit of property to everybody, so everybody takes care of their little piece of property. They have control, but also responsibility. Instead of these systems which are massive, like Facebook, where Mark Zuckerberg has control, but nobody—he doesn't really have any responsibility for what happens on Facebook, and that's what you see—all of these big businesses and private equity funds—they’re control without responsibility.


[00:37:06.23] So, the way that you address that is, you make sure that you can't. You

create public policies that make it impossible to run a system without taking responsibility for that system, and if you have—if you make sure that, if you're a private equity fund and you buy a company, that you are responsible for what that company does, then people will not buy companies and loot them, because they'll be responsible for what happens. We've made it possible for them to do that. So, we just have to change those rules. That involves a bunch of banking, changes to banking law, and corporate law, but we can make those changes, we've done it before.


[00:37:42.26] In terms of some of our institutions that are really big, like Amazon, there's

a lot of different ways to reduce the power of Amazon. You can split it up. it's a really big institution. There are lots of different networks inside of Amazon that can be separated from one another so they're smaller, but also those networks themselves, you can say, "Hey, if you're a distributor, you're an Amazon, you're a marketplace, you can't also compete in that marketplace."

[00:38:14.04] KIRBY: Aren't they in violation of just existing anti-trust laws?

[00:38:18.22] STOLLER: Well that's not clear, because anti-trust law is pretty vague,

so, you know, I might say they are, but until you spend 10 million dollars in a court and a judge rules, you don't really know. Anti-trust law is messed up that way.

[00:38:32.28] KIRBY: Let me ask you, very quickly, just on the point of the New Deal.

You know, Steward Alsop in his book, The Center, makes the argument that power shifted from Wall Street to Washington during the New Deal and that, really, we saw a huge concentration of power. You just described it as a decentralization of power. Is there a disconnect there or are we talking about two different kinds of power?

[00:38:56.13] STOLLER: Well you can, I mean—yeah, I don't agree with that overall

view. What happened is the control over finance moved from Wall Street to Washington, D.C., but power in general, was decentralized from New York to the whole of the country. And you can just look at regional inequality, which was dramatically reduced in the 1930's, '40's, 50's, 60's and 70's. So, something like (I'm going to make up these numbers, but they're roughly accurate), in Mississippi there just weren't a lot of, I think it's something like, there weren't a lot of toilets in the 1930's; people didn't have toilets. And by the 1970's everybody had a toilet, and that was true throughout a lot of places in the South, there was—it was a poor region of the country and it grew much wealthier and much more powerful because of policies to move power to places that had been relatively much poorer.


[00:40:08.25] And that's because the centers of capital, New York, Pittsburgh, and the

North East, they were disempowered, relative to the South and the West. And you know, a lot of people argue that there is a racial element to that, but that is not actually what was going on. What was really going on was a view that you should decentralize power away from financiers, and those financiers lived in New York, and so power moved away from New York. There definitely were racial elements in how that played out, and I'm not trying to downplay race, but I’m saying the broad arc of the New Deal from the '30's to the 1970's – you can go back, there are other periods in American history that were similar—was actually about moving power away from these large financial holding companies and moving it into the hands of the people themselves.


[00:40:57.23] And the historiography, there's a narrative that because the government, the

federal government was much bigger after the New Deal that there was some sort of centralization of power in the administrative state. In fact, the administrative state was designed to undermine the power of monopolists and financiers and decentralize, and it just happened to be that there were larger public institutions, but that wasn't more centralization of power, it was less centralization of power.

[00:41:21.12] KIRBY: Fair enough. I mean, I guess some people would say, “Are we

talking about wealth? Are we talking about power, where do the two join?” But, let's pass on for the moment. You wrote about this, and I thought it was pretty striking, given that your book came out in 2019, you know, before all this, but how does monopolization effect the healthcare system? You wrote in Goliath, that 40% of hospital stays occur in markets where one entity controls all hospitals, and these hospitals, like all monopolies, no longer have a strong incentive to deliver quality care at a reasonable price. And instead, they sometimes overtreat and kill their patients. So, I just want to give you this thought: when I read that, I couldn't help but think of the intubation protocol for COVID-19, which is, because it's standard of care, hospital owners are indemnified; we're hearing that 80% of intubated COVID patients die, a number of doctors around the country have spoken out against the ventilator protocol, but do monopoly practices in the insurance system create a one size fits all approach to medicine that hobbles flexibility and the ideal of individualized medicine?

[00:42:28.16] STOLLER: I don't--I haven't--I'm not comfortable talking about whether

to intubate people, because I just don't know--

[00:42:39.00] KIRBY: No, I'm just talking about, in general, does it hobble flexibility?

[00:42:41.18] STOLLER: It does. I mean, one of the things that you'll notice about—so,

I'll give you two examples. One, there were a lot of arguments about whether New York had enough hospital capacity. And America doesn't actually have, despite paying, by far, the highest prices in the world for healthcare, we actually don't have that much spare capacity. And New York State, despite having higher prices than most of the country, has actually been cutting the number of hospital beds over the last 10 years, and that's because of monopolization. One of the things that happens when a company monopolizes a market is they reduce supply. They raise prices and they reduce supply, because they have control over the markets, so they don't have to provide as much, and they can make as much money by just raising prices. So that's what happened with healthcare. That's why healthcare prices have gone up, and hospital supply, which is to say beds, have gone down.


[00:43:31.02] The other example would be ventilators. Let's just say - I'm not sure

whether it is a good idea to ventilate people or not, but at the beginning of the pandemic, we were saying, "Oh my gosh, we don't have enough ventilators," and story came out in the New York Times about how the government had contracted with this company called Newport Medical to build a bunch of ventilators. They contracted with them about, I don't know, 12 to 13 years before the pandemic, and Newport was a small company. And they said, “We'll make ventilators cheap and we'll make them good. We're new and innovative and small,” and the government was like, "Great." The company came up with prototypes, they worked, the government was like "We want them. Sell them to us." Then, another company called Covidien, which was a much larger medical device company, which made competitive ventilators that were much more expensive, bought Newport Medical and shut down their line of cheap, good ventilators. And so, fast forward, the government, you know, Covidien, repudiated the contract. Never fulfilled it. So, then the pandemic happens, and the United States is trying to find a way to get some ventilators, and it doesn't have ventilators in its stockpile. So that's another example of bad merger policy that led to a lack of ventilators, and bad merger policy that led to overpriced hospitals with less capacity than we might have otherwise needed.

[00:44:48.25] KIRBY: What do you think of the massive wartime production, the act, I

suppose, was never invoked, but this call from, you know, to GM and other private business, to suddenly massively shift over production to, say, ventilators. Was that, this, a kind of, in the way that wars can be, a sort of interesting boon to big business as well?

[00:45:16.22] STOLLER: Sort of. I mean, it's hard to tell how much it actually happened, because Trump isn't always forthright about what's actually happening, put it that way. So, all of these people were like, "We need the arsenal of democracy again. We need GM to start churning out ventilators, like they did tanks in World War II." And it's kind of a bad joke, because when you actually look at the amount of bureaucratic competence that the government and the military and our corporations had in the 1930's versus today, you know, it's not the same thing. Like, we were making a lot of things in the 1930's, and today, we're ordering those things from China, so it's not—we’re just a—and the military had huge numbers of factories, and capacity to actually make their own material—

[00:46:11.04] KIRBY: In their own factories?

[00:46:13.05] STOLLER: Yeah, they owned their own factories. They also had enormous amounts of planning capacity and they spent the interwar period from world War I to World War II planning about how to fight another war and build up capacity. So, they knew a lot, and we had antitrust agencies that knew a lot about the economy; we had this huge knowledge base in our government, lots of different agencies that actually had the capacity to build their own things and also had knowledge of how the private sector, where that capacity was. None of that exists today. So, you know, a lot of this weird nonsense about "Oh, we need GM to start churning things out," as if it's 1939—I’m sorry but we shipped all that stuff to China. You can't ship 72,000 factories to China from 2000-2014 and then just one day try to turn on those factories. They're not here anymore. I mean, we even had a problem where, I think, Lockheed Martin was complaining the other day because they get, you know, they've been moving so much production of weapons systems to Mexico and, low and behold, it turns out Mexico is a different country, and they shut their border. So, we can't get defense supplies. You know, I mean, that's—this is not 1939 anymore. I mean, it's not even 1999. We really have to rebuild a lot before we can pretend to be able to churn things out.

[00:47:32.11] KIRBY: In Goliath, you describe the role of monopoly in the opioid

epidemic. Can you take us through that briefly?

[00:47:37.12] STOLLER: Yeah, so this is an example: In West Virginia, in the early 2000's—monopoly is not just about controlling a market or concentrating power in a market, it's also about self-dealing. So, you know, a business model, if you have control over distribution, and you have control over what those distributors, and you make something that then gets distributed, you have an incentive to distribute your own product. Even if you don't own that distribution channel, and you're allowed to give kickbacks to that distributor, or that distributor has market power, you can corrupt economic systems and markets. So that's what happened with opioids.


[00:48:15.19] In the early to mid 2000's, the West Virginia government noticed that there

were a lot of people dying because of this medicine called oxycontin, and they said to their public healthy system for government employees, so their insurance system, said to the company that managed their perscription drug plan, they said, "Hey, can you downgrade the amount of OxyContin that you're prescribing to government employees? it seems like this is a problem." And they are what's called the Pharmacy Benefits Manager, it’s the company that manages the list of pharmaceuticals, said "No, we're not going to do that." And the reason that they wouldn't do it is because they were getting paid off by Perdue Pharmaceutical, which makes OxyContin, so, they were getting kickbacks for recommending OxyContin.


[00:49:09.12] So, for a couple of years, the West Virginia government was trying to

prevent their own health system from overprescribing opioids, and they couldn't do it. Finally, eventually, they were able to get, you know, they took them court I think, and there was a big legal battle, and they eventually were able to get them to stop prescribing OxyContin, but by then, a heroin epidemic had taken hold in the state. So that's an example on how concentration and self-dealing in the healthcare system actually leads to the over prescription of addictive products.

[00:49:41.13] KIRBY: You mentioned that some of these companies—I don't know if

they actually also have the, like, the...what's it...Naxo—I can't pronounce it-

[00:49:49.22] STOLLER: Yeah, Naloxone, yeah.

[00:49:53.12] KIRBY: -yeah, Naloxone, but, so, I mean, really, what we saw were

monopoly practices moving in on state systems, just individual doctors, they were wining and dining them and they kind of pushed this notion that there should be zero pain. I mean, they did this throughout the country, right? I mean-

[00:50:10.23] STOLLER: Yeah, pain management, right.

[00:50:11.22] KIRBY: Pain management. I mean, how did they manage--

[00:50:15.07] STOLLER: In the 1990's, there was this—this is Perdue—they put

forward this idea called “pain management,” where they said “Oh, we've figured out that this medicine, which chemical structure is very similar to heroin, is not addictive. It's just good for dealing with pain.” And then, like, 20 years later, there are all these people being like, "Who could have known heroin was addictive? We had no idea and now we're learning so much more." And it's like, they were just bribing people—they were bribing doctors, they were bribing nurses, they were bribing medical schools, they were bribing scientific journals, that's what they were doing to, like, pretend that heroin was not addictive in this idea of pain management.


[00:50:52.12] But you mentioned there was this other medicine—I think it's called

Naloxone or something like that, which is the medicine to deal with overdoses. That is also, I think, a monopoly or it's a very concentrated market, and so that drug is really expensive. So, to save people who are overdosing on heroin, it's very expensive for local cities, because they have to buy this medicine to deal with people who are overdosing as well. So, it's like, get them on both sides.

[00:51:21.09] KIRBY: Last thing on that, it seems in particular, that monopoly practice

has to be gotten out of healthcare. What would you—I’m sure it's part of your general strategy, but where would you start in reforming the healthcare system that we—that has currently not done so well for us?

[00:51:44.14] STOLLER: I think the easiest place to start is just to impose price caps on

hospitals. So, you know, what you could say to hospitals is, a knee surgery—you could have two patients in a room, like in separate beds, each of whom is getting the same surgical procedure, and just because one of them has one kind of insurance and the other one has a different kind of insurance, they could pay vastly different amounts for that same procedure. And that's because the hospital is bargaining with the different insurers, and they're bargaining purely based on whether that insurer has market power or not, and whether the hospital has market power or not. That's fundamentally unproductive.


[00:52:27.14] If you want to have competition in healthcare, the hospitals should be

competing to actually deliver that service at a lower cost or better quality, not competing to see how much bargaining power it can use to extract. So, what you should do is just—Medicare has prices that they pay for all of these procedures. Basically, just say, “All hospitals will take those prices. [It] doesn't matter if it's from Medicare or from any private insurance company, it's just those two people in the hospital room, they get the same price for the same procedure,” and then those hospitals can compete over delivering that care, instead of screwing around with billing. This would probably reduce the average amount that a family of four pays for healthcare in America by $10,000 a year. So, it would be huge savings. It would also help save a bunch of rural hospitals and it would reduce the overfunding of gilded super-wealthy hospital systems, gilded really wealthy hospital systems in certain urban areas, in Pittsburgh, in various other places.


[00:53:40.14] So that’s the easiest place to start. You could also do a whole bunch on

pharmaceuticals. A lot of this is...so there's some patent things you could do, but you could also reduce consolidation in the pharmaceutical industry. You could deal with pharmaceutical benefits managers. Also, it's important to get private equity out of healthcare. Because private equity is a business model that is designed to find ways of raising prices. That's all that they really do. So, you put prohibitions against private equity being in the healthcare space. Right now, private equity is trying to buy up a lot of doctors’ practices so that they can find a way to ultimately raise prices. So, that's what I would do.

[00:54:17.29] KIRBY: Lovely. I have to ask you this because, you know, the ultimate

monopolist, maybe the ultimate monopolist in American history, though I'm not sure, has become somehow the go-to guy in the public health sphere, and I'm talking about Bill Gates. And I'm wondering, first of all, what are your thoughts when you see him say, with Sanjay Gupta, etc, you know, doling out his thoughts on all this? I mean, how did this happen? How did he go from being a guy with software that was virus-laden, to being a guy who was leading the charge towards healthcare solutions for the world?

[00:54:56.27] STOLLER: Yeah, I mean, it used to be that we would look up to people

who were public servants and had a good track record of...I guess in the late 19th century, heroes were municipal workers who had cleaned up cities, right? It was a different social conception. People, you know, in the '60s, every kid wanted to be an astronaut, right? That's what they wanted to do. And in the '70's, a lot of people looked, they said, "I want to be a Ralph Nader," and then in the '80's, they started to want to be investment bankers, and become really rich. And it's not that people got greedier. It's just that the society made the choice. In the '30's it was like, "I want to be a union leader," right? Like, it was just kind of, where do we put the legitimacy of power? Who gets to be a moral leader in our society?

[00:55:55.23] And we have decided, and I think this is the law in economics movement,

but it says that the culture of our political elites, our philosophy, is that those who have money, those who establish market power become middlemen. And you know, Bill Gates was just a middleman between users of computers and the computers themselves—that’s what an operating system is, it's an onramp to a computer—and he was that middleman. And he was able to extract, basically, a tax on any computer that was sold and build fortune worth a hundred billion dollars.


[00:56:30.28] And we've just decided we look up to people like that instead of

recognizing that that guy is a good businessman who, because of public policy choices, instead of being worth 50 million dollars, was worth 100 billion dollars. And we've just decided that that kind of person, they know what they're doing about everything, because they have a lot of money. Well, we shouldn’t think like that. Because, you know, Bill Gates may make good decisions or bad decisions, about public policy choices, but those public policy choices really should be made by public servants. Not just by people who just happen to be in the right place at the right time, and have a mother, as Bill Gates did, who was on charity boards with the head of IBM and then the head of IBM signs a deal for, you know, MSDOS—“Oh, that's Mary Gates's son, Bill”— and now 30 to 40 years later, that guy is in charge of our healthcare and our education and you know, African public health standards. I mean, it's just like, that's not a democratic system, right? So, we shouldn't have that kind of system. We should change our public policy framework so that that kind of person, good or bad, isn't making those decisions.

[00:57:39.28] KIRBY: I just want to know, have you looked at any, for instance, of, or

have done your own work, but have you seen, like, Tim Schwab's piece in The Nation? You know, this kind of, philanthro-capitalism thing? Have you-? This new model that Gates is doing, where they're literally donating to companies that are rolling out investments, say, like Mastercard in Kenya, but somehow or another, this is seen as public good?

[00:58:01.04] STOLLER: No, it’s Mark Zuckerberg's—the Chan Zuckerberg initiative

is not—I don't even know if it's a charity. I think they do investments as well. So, doing change through business is fine. But what I think is disturbing is the idea that we're going to do governance itself through basically people who have the money to pay for it.

[00:58:21.13] KIRBY: Can you describe how the food supply chain works? What are

just-in-time delivery systems? Are they vulnerable in crisis situations? And what are we seeing happen with them right now?

[00:58:30.26] STOLLER: So, just-in-time delivery is when you have, you don't keep

any inventory on hand, so you don't have lock up—you don't have to pay for warehouses to store it, you don't have to have some money to keep, to pay for, the inventory as you keep it on hand and it's a more profitable way to run a manufacturing company or a meat packing company or something. But it's also less-resilient. So, if you don't have any spare goods on hand, then, if you run out of—like if there's a supply disruption, then you have to shut down everything. And so, that's—we run a just-in-time inventory management system throughout American business, and so it's really risky.


[00:59:12.19] We overproduce a lot of different types of food, but because we have a

very brittle system, so we can't easily repurpose one kind of food for another kind of food, if there's a disruption. So, I think, there's one particular kind of farm that makes eggs that are only used for a certain kind of liquid mixes, because it's vertically integrated, this one company that makes a large portion of our liquid mixes; they have a whole lot of farms that just have eggs specialized for that. Hertz—not Hertz—Heinz ketchup, they have a lot of farmers that only grow Heinz-engineered seeds for Heinz ketchup. Well, what happens if, you know, you don't need as much liquid mixes in a pandemic, but you need to have eggs, because all of a sudden people want to buy a lot of eggs because they are cooking at home?


[01:00:05.20] What happens if there's a supply disruption, or if there's a, you know, all of

a sudden you need to stop making products for the commercial sector and you need to repurpose them for residential? Well, if you have a bunch of small farms that just make egg and they can sell to anyone, you can easily repurpose it. A lot of small farms manage in this pandemic because they can just sell their stuff to different groups. But if you specialize in this one particular egg type that only is used for liquid mixes, or if you only grow Heinz ketchup tomatoes, or if you only have chickens that have to be processed by Tyson’s, and all of a sudden, a Tyson's factory goes under because everybody's got COVID in the meatpacking plant, a lot of food goes to rot, even as you have hunger on the other side.


[01:00:50.04] So, we have a middleman problem, because these supply chains are so big,

and what's called vertically integrated, and so controlled. And you also have the just in time inventory management problem, as well. So, these are operating on very thin layers of inventory, so if there's any disruption at all, you're going to have a huge pile up, a lot of waste. And that's what you see now.

[01:01:13.15] KIRBY: So, it seems to me that, once again, decentralization is-

[01:01:16.19] STOLLER: Yeah, if you had regional slaughterhouses instead of, you

know, one of the things you're seeing now is a meat shortage. And that is because you have a small number of very large slaughterhouses that handle a lot of the meat in our country. If you had a lot of—and they're getting, they're being shut down because a lot of the workers there (it's cramped, confined spaces), they're getting COVID. So, you know, there's not enough meat being produced, but at the same time, you have too much cattle, because the cattle's not being slaughtered, too much chicken, it's not being slaughtered, so they have to just basically bury under a lot of this cattle, a lot of these chickens, and meanwhile, there's a meat shortage on the other side. If you had a lot smaller regional slaughterhouses, and farms that could sell to multiple different slaughterhouses, it would be a much more flexible, much more resilient system. You wouldn't have these shortages, and you wouldn't have the surpluses on the other side.

[01:02:08.26] KIRBY: I mean, it—in a perverse way, I mean, it's more perverse even,

somehow, I'm reminded of scenes in Steinbeck's The Grapes of Wrath, burning oranges on the side of the road-

[01:02:16.29] STOLLER: It's the same thing.

[01:02:19.22] KIRBY: -because they would reduce the price too much. But these are

kind of, some of these things are biologically patent-designated, vertically-integrated systems. In Goliath, which came out just before the pandemic, you describe a seemingly intractable system of monopoly power. That situation seems exponentially worse now, but you wrote that, “There is reason to hope. We have been under concentrated monopoly rule before, where a chosen reality is codified as natural law, and we've overcome it.” Do you still see that possibility, and how do you think we should resist what's happening?

[01:02:51.17] STOLLER: So, there are two parts to a crisis, and the first is the clarifying

moment, when the crisis reveals something about your society. And then there's the reaction to that, when we use our politics to decide how to respond. So, in the New Deal, you know, there was a clarifying moment from '29 to 1932, as the crisis showed how weak the banking system was, and how the old order had no answers for the political collapse. And there were different responses in different societies. Germany responded one way, Italy and the Soviet Union and Japan, and England, France, America, all responded differently. Those responses depended on the political context of each country. In America, the response was the New Deal, but first you had to see, you had to clarify what your society was organized around.


[01:03:42.16] In 2008, the clarifying moment was the collapse and the response was to

bail out the banks. We chose to reward the people that had gotten us into the problem, because we believed—we still trusted their power. 9/11 similar. It was a crisis. It clarified that we were not a hyperpower immune from any sort of blowback, and the response was to revisit American foreign policy and decide to take a much more aggressive, nationalistic, violent way of approaching the world, and we chose to invade Iraq. So, we're still in the clarifying stage in this pandemic, where it's really obvious that we are going to have a big state, we are going to be planning our economy, we do not have the public health systems or the public infrastructure to manage this pandemic as constituted, so we are going to build those, or we are just going to just accept a much higher death rate. There's a lot of clarifying that's happening right now, and people are absorbing what's going on.


[01:04:48.25] And I think we're starting to see some of the political discussion about

what that will mean. And, you know, there's an election coming, and there's a lot of things that are going to happen in the Republican party and the Democratic party, so I don't think that we necessarily know what the full reaction will be. I mean, I'm not happy with how we've responded so far, but we're in early stages in this crisis, so we could go in lots of different directions.

[01:05:16.22] KIRBY: But it seems like the Gates's of the world are setting the agenda.

[01:05:22.27] STOLLER: Well they are, but remember, 1930, 1928, Herbert Hoover

wins, I think, 44 or 45 states. He's endorsed by both the AFL and the chamber of commerce, the great engineer, chicken in every pot, end poverty forever. Everyone just assumes that the republicans are going to rule forever. And then they start losing because of this recession that turns into a depression. But even in 1932, like, when the democrats finally, ‘31, ‘32, when they first took power in the house, the main goal for John Nance Garner, who was the Speaker of the House, was a sales tax increase to balance the budget. And they didn't want to do anything about corporate power or banking power, they all wanted to cooperate with Hoover. It was really one of the most wretched democratic majorities that I've ever seen, in the face of a depression.


[01:06:15.05] They really did, you know, their whole goal was to get rid of prohibition,

which was sort of the social issue of its day, right? A lot of them were funded by the DuPonts...it was a disgusting...it was just part of the old order, right ? So, a lot of them were on JP Morgan's payroll. So, you know, that changed really quickly. So, it’s like, things can look really bad, but it doesn't necessarily mean that they will continue to be that bad. I think that we just don't know. And I’m not super happy about what's happened, and I don't necessarily believe that the democratic party as an institution right now is going to address, really, any of these problems. But I don't—I mean, I think, fundamentally, we are do live in a democracy. And what I think got me so despondent about the democratic party and watching this primary isn't that democratic leaders did what they did. It's that the voters really wanted what the democratic leaders did. And they really support the democratic leaders in concentrating wealth and power. So, it's the voters that are actually want what they're getting.

[01:07:27.24] KIRBY: Don't they know not what they do?

[01:07:29.24] STOLLER: No. I think they just don't—they loved Obama. They see

politics largely as ceremonial and having very little to do with underlying political and economic realities. So, they're not doing politics, because they don't really believe in politics. And that is an ideology. They do not—if a politician made their life better, it isn't necessarily the case that they would understand that that happened through politics. What they learned from Obama was politics is show business. It's not policy. It's not about arranging society. It's not about justice. So, and that's on the democratic side. The republican side is different. But that's not—that attitude has to change.


[01:08:16.16] People have to find a way of believing in politics again. And if they don't,

then they're just going to be ruled, because fundamentally, they don't want to be free. It's just too much of a hassle. I do think that, at some level, people do want to be free, and I think that we can convince them, and people can convince themselves, and then our politics can change, it can change in that way. I think that it's likely that that change comes with a sort of weird coalition from the right and certain parts of the left. I don't think it's going to come from the democratic side or maybe the progressive side anymore. I don't think that they want that. But you do see enough ferment on the right in a way that's scary, but also, in some ways, you could see it as healthy, where they're saying, "Hey, wait a second, we have these real problems with China, we have these real problems with monopolies. We have to rethink our libertarian assumptions." A lot of that's happening on the right. And I think that could really pull democrats as well. So, it would be—it’s not going to look like the New Deal, but I don't think this is, you know, this current very strange constipated system is inherent.