tv Headline News RT April 30, 2013 4:00pm-4:59pm EDT
coming up on r t f would punish high tech companies what does that mean for your civil liberties will lead back to. the last hour would you go to become a us some men and women joining the war had a chance to become an american archie shines a light on this trend. and the f.b.i. is looking with a corporate c.e.o. and more. it's tuesday april thirtieth four pm in washington d.c. i'm megan lopez and you are watching r.t. . well to spy or not to spy that question might not be up for debate for too much longer comes to cyber surveillance that task force is coming up with displacement to fund phonies to find a way to allow agencies like the f.b.i. to monitor online unifications in real time or face crippling penalties this by promising privacy to their customers so companies like facebook and google could
rewrite on force the rewrite ever companies are going to discuss this i'm joined now by by. moon so it seems like the government can't figure out how to crack these codes so once these technology companies to develop ways for the government to actually monitor an intercept these communications on its behalf even the governor even though the government find the code or thanks for having trying to have the companies to work the good part of that statement is quite the opposite fact that the government is actually the companies you go feared but you have to do it there's a scene in that because if you let the government come forward and say hey you know what you're going to do it this way i don't really understand how your code works i don't really care you're going to do it my way or get in trouble then you have the possibility of a network crashing systems going down all sorts of chaos can happen when the government does and that's true with anybody if you build technology to fit with another piece you don't understand you can easily crash it so the silver side of
this is that companies can figure it out themselves although it does raise all the things you were talking about which is the privacy issues so how would a law like this affect the way that we interact with our technology would it mean that anything we save in our cloud for instance or that we see through google glasses or even our keystrokes could be recorded and available for the government to pursue. well i think what if you are there's two ways to look at this one is if you're in the typical user who is using these services nothing's really going to change in your world historically the government has the right to come and ask for information if they're investigating and they have lawful a legal process a search warrant a subpoena things like that what they're doing now is they're saying we want to use that same legal system and get wiretap orders and people we are investigating in a criminal activity where the judge has authorized us to do so so if you're not doing anything wrong it really you will have no impact you won't see any impact if
you are on the other hand trying to hide what you're doing and having real time communications and you're talking about blowing up a building or doing some terrorist activity then obviously you may be subject to an investigation if there is this technology built and instituted after a wiretap order comes in then you could be monitored every keystroke every conversation you're having whatever the case may be it is possible that's the direction this is headed but what guarantees are there that this back door wouldn't be abused and what kind of judicial oversight when the f.b.i. need to in order to access this customer information. great question i think the reality is there's two sides to relieve very good balancing or protective measures that are in place one is that the government has to go through the judicial system they have to ask a judge to authorize a wiretap order which actually and most people don't realize this has a string of requirements on when you can actually get it versus
a search warner subpoena which are easier to get on the other side the protective measures are actually coming from your own service facebook google to perth examples of companies that do and amazing amount of work to protect your privacy so when the government comes say with a search warrant or subpoena they still put it through the rigamarole their systems in place that public many people don't realize this their systems place in. they have lawyers looking at and saying is this lawful is this make sense is it coming from the right agency do they have the authority to do this and then are we going to disclose only what we're supposed to are we going to go beyond and are there systems in place to limit so i know in a in a very good way the providers that these large tech companies are their reputation is built on privacy many of them and because of that they do a ton of stuff to try to protect the user privacy so from that perspective if i'm the user i feel sorry go ahead that might be the case but the problem is that
google for instance and facebook happens to start encrypting their e-mails when it was being sent from one to another they did that back in two thousand and ten only as a hack they did that to protect their customers now what they are asking what the government and this f.b.i. legislation is possibly asking customers these companies to do is to find ways for them to be able to to open up that door what that make those companies more vulnerable once again to those type of cyber hacks outside of the government so what you're actually raising million is a very good security question and that is if you're going to wiretap it encrypted communication at some point in order for the f.b.i. to understand what is being said it needs to get an encrypted or d. encrypted and is it possible for a hacker to go into that corruption point and figure out what's being said and therefore the whole idea of encryption goes out the window and i think likely is
this to pass. so well how likely is is it's going to be one of those that things get debated galore inside the beltway what will happen is the f.b.i. has thrown out a pretty it what appears to be an extreme idea from many people's points of view so what's going to happen is they'll be tons of debates for all interested stakeholders those representing the consumer people who are watching those tech companies the government's interest the investigative interest and at the end of all this it may or may not pass but what will happen and i can guarantee this is some kind of compromise will result where something gets done to help the f.b.i. investigate in platforms where right now they have blindfolds over their eyes and terrorists are getting away with things that they're really worried about when it comes to protecting our own citizens the people that we're talking to right now it is a very interesting legislation founder of s.s.p. blue thank you for weighing in. now to guantanamo bay cuba where a hunger strike among detainee's at the facility continues to spread u.s.
army officials report that now one hundred sixty six presenters on the island are on a hunger strike in protest of their indefinite detention lawyers of the detainees say the number is actually closer to one hundred thirty detainees the hunger strike has been growing on an almost daily basis and prison officials now say twenty one individuals are being force fed who knows too now during a press conference today u.s. president barack obama said that he doesn't want these individuals to die and that the civilian court system would be the best approach to trying the suspected terrorists president barack obama vowed to close guantanamo during his campaign in two thousand and nine but to no avail today president obama pledged again to push congress to close the detention center. i continue to believe that we've got to close guantanamo i think well you know. i think it is critical for us
to understand that wanted a mole is not necessary to keep america safe. it is expensive. it is inefficient. it hurts us in terms of our international standing it lessens cooperation with our allies on counterterrorism efforts it is a recruitment tool for extremists it needs to be close to. and president obama is getting some help a petition filed by colonel morris davis who is a frequent guest on this program says that the patriotic and american thing to do would be to close the detention facility it's one of the many online petitions calling for get most closure will keep you posted on whether the hunger strike petition or presidential action result in any changes at the facility. while the debate over immigration reform is still being hotly contested within the walls of capitol hill nearly everyone can agree that tough but fair laws are needed in order
to get the u.s. back on track the question now isn't who or what or when the question is how and as congress members spar and stall millions are being left in limbo now some of those illegal immigrants also happen to be u.s. military personnel people who have fought to protect the interests of a nation that they cannot yet call their own in some cases those veterans return home only to be deported once again it's not a new story but it's an interesting story to look at an issue that actually deals with the immigration debate as it forges on our correspondent margaret how reports that. the immigration debate reaches on capitol hill many million u.s. citizens have charted the different path becoming active service military members risking both life and limb for a shot at the dream of becoming a legal american citizen now this path to citizenship is a gamble and a game that doesn't always pay off so i'm standing here in front of one of washington d.c.'s military recruiting sites and this is where you would go to
actively a list in the u.s. army now of those that go through these doors most are u.s. citizens although there is the exception that foreigners will come hoping to get citizenship through now there is many a sixty five thousand people serving in the u.s. military that aren't actually citizens they're legally serving by holding a green card this process can fast track them from green card holder status to u.s. citizen right now. the policy is that if you know for all of our green card holders that serve which there is a good amount in the military as soon as you serve in a combat zone it doesn't in a combat zone like iraq or afghanistan but you don't wait five years that one of the things that happens in the war zone a citizenship ceremony where people automatically qualify for citizenship but it occurs all the time so it's long as you deploy. that to the war zone you automatically become a u.s. citizen but it's a complex process for those willing to get into it frankly this is one of the reasons why the military started basic training naturalization because people have
the right to get their citizenship through military service but oftentimes the system wasn't catching up with them in the majority of non u.s. citizen serving are classified as legal but it is possible for undocumented immigrants to serve to where president obama alluded as much during an announcement signaling a shift in his deportation strategy in june of last year the boston globe wrote at this time president obama's decision last week to immediately halt the deportation of certain young illegal immigrants generated widespread joy and relief among the undocumented and their advocates but the majority policy shift which obama said included those who have served in the military also stirred confusion the numbers are under fire bill in part because no one from the military is going to admit to breaking federal law and it's difficult to verify those who are legally serving as well with the heavy operational tempo of the u.s. military people are getting deployed all around the world and the department homeland security which is responsible for making them citizens was having
a hard time finding them and and turning them into citizens another issue those legal documented workers serving may not reap the same familial benefits injured or killed while serving as someone who is legally serving but not yet a citizen dies while active it's unclear if their loved ones to see any of their benefits because of legal status family members have died in iraq and afghanistan such as in two thousand and seven. one of the u.s. soldier was taken prisoner missing. he was killed and his i believe his wife or his family was illegal so there's a question of what about the family members of people who died fighting for the united states and what is there that they're living here and those are all things where i think if you talk to people who surveyed say gosh this family has given more to the united states than a lot of americans have. how do we find a path to citizenship for these people now of the several thousand serving with the hope of realizing a dream it's a process with risks as well as rewards in washington. while
president obama is holding heading south of the border later this week planning on stopping in coastal rica and mexico the president is slated to discuss u.s. latin american relations moving forward among those issues the economic ties binding to the different countries and the u.s. to that region now one of the most pressing issues on the table is the seemingly endless war on drugs voices within the obama administration have indicated that newly elected mexican president enrique pena nieto might take a different approach with the war on drugs than his predecessor felipe calderon did critics worry that pena nieto could be willing to scale back on the aggressive strategy against drug kingpins and exchange for comber streets to talk more about this possible shift joining joining me now is john ackerman he's a law professor at the national and not autonomy university in mexico hi there john
can you talk a little bit more about the differences between current mexican president pena nieto and former president calderon. hi how you doing the pleasure they would do well i would say the different more discursive and superficial and they are profound and yet there has a new discourse he's saying two things he's saying instead of this all out battle armed military battle against drug cartels he wants to prioritize the health and the well being of mexicans this is a good sign but in fact on the ground what we're seeing happening is more of the same opinion yet though has not pulled the military out of the street he has not set any kind of timeline to do so either he has continued with the same strategies as philip because they don't. like relationship with the united states looks like it might change it might be that from the reports we've been
seeing that the next moment is not going to collaborate as much with the u.s. authorities this could be good news but the fear is that he will be doing so just to cover up increase in corruption and cutting deals with an orchestra africa's well that's exactly what i was going to ask you about because obviously pena nieto made it is a big election goal to really curve this violence and to get the straits of mexico to be more calm the critics have said that he's willing to scale back that pursuit of cartel king penned in order to calm down those straits is there any validity to that and it also will to actually keep those dangerous criminals on the streets that that could make it safer. well i think we have to look at it from doing a bunch of you first of all i think it's not really correct to characterize the calderon strategy as an all out battle against the cartels calderon pick favorites as well he'd negotiate with cartel members and he did not go after the most important issues for instance like corruption in
a superficial way and money laundering it was more of a public relations display putting the military on the streets didn't actually get down and attack the cartels head on i think when you get those staying in the same idea and public relations display this time about supposedly reducing violence although he has not been too far while on the ground using the military and negotiating with cartels the danger here is that by putting the number of homicides as the number one objective which is what bennion has said reducing that that's great thing but if you do that instead of or if you do that by allowing the cartels to take over large parts of the country increasing extortion reducing the rule of law in the long run all of us in north america are going to pay for that so worrisome thing about spending it though is that effectively he comes from the old guard of the pre and the way in which the old guard of the pre the revolution institutional party which is in power for seventy years the way in which they're used to dealing with these issues is by sitting on the table the narcos and not
actually installing a rule of law so we're going to have to be very attentive and watch how things develop in mexico at the same time however you say that calderon the not installed like the screw really crazy very forceful kind of president but at the same time calderon requested in two thousand and six that president bush sent him armed drones for the use in the drug war because he was so impressed with the ways that the drug that the drones worked out in afghanistan against al qaeda obviously president bush declined but is it fair to compare al qaida with these mexican drug cartels in the first place no no no what i was talking about calderon it wasn't he didn't do this military display. a an attack on the drug cartels all those things that he wasn't actually doing a systematic effect effort to eliminate the drug cartels in the objective and effective way it was a lot of public to do show and that was part of it look he asked this is really quite remarkable come on the world washington post this weekend that calderon pleaded with push for armed drones to come and knock out the cartel leaders now
this would have been an incredible scandal in mexican public opinion to have drones coming in and shooting down on mexican territory this would be a vile extreme violation of the neck and constitution as it would be of the i think just as if mexico send armed drones to knock out u.s. citizens on their side of the border so yes it was a very irresponsible strategy that one of calderon and the worrisome thing is that the pain and destruction might be equally responsible down a different direction and john let me i think you're forgettable to say is the real solution yes yes i'm going to stop you there for just a second because president bush to decline to actually give him those trials but at the same time he did allow the mexican military the opportunity to determine where the drone pilots would fly is there a difference between the two should we be as concerned as we would be handing over those drone technology. ok well if you look at difference but that first of all there are drones what we're talking about here specifically are armed drones that
were those were not flown over over mexico at least according to the washington post but presently there are almost every day or at least every month on armed drones flying over mexican territory run either by the us or by the mexican mexico itself has purchased drones itself now this drone technology is worrisome in so far as it can be used for a political motives in so far as it can be used as create collateral damage on the ground in mexico so that's the worrisome thing i don't think that the mexicans can trust the americans the united states to direct and run the show that's been part of. the problem because united states' priority has always been to protect united states border and keep the violence to the south of the border and the blood for the drug for the drug war while the mexicans should be thinking more about their own well being and despite that still so many deaths and mexico remains the u.s.
markets largest supplier of heroin crystal meth and marijuana john ackerman a law professor at the national a thomas university in mexico thank you so much for your insight great to talk to you to virginia now where a seemingly simple case is getting more complicated by the day last month a former chef who worked at virginia's executive mansion was indicted with four felony counts of investment for allegedly using state funds to pay for food for his private events ok so the guy still food case closed right not even close instead of the chef todd snider actually told us already is that his former boss might not have such a stellar reputation either now that prompted an f.b.i. probe into the ties between virginia governor bob mcdonnell his wife were reading and the c.e.o. of a dietary supplement company but that's not all even the attorney state general is being dragged into the mix he's running for governor and also was going to be the one responsible for prosecuting the case that was until last week when he recused
himself because of a possible conflict of interest now to help me untangle the story michael brooks as a producer for the majority or for. michael can you help us break down the story i mean is it everyone is guilty in this case so or is it a disgruntled former employee trying to make trouble for his old boss. you know it's great to be talking with you it could be all of the above everybody here looks pretty questionable i would say that the stakes seem to be pretty significantly different. the embezzlement charges are worth maybe a couple hundred dollars or something like that the gifts. of the governor and the attorney general have received are in the thousands and clued in a fifteen thousand that the c.e.o. of this nutritional supplement company i think called star scientific which i would probably never do anything that a company with that name manufacturers are gay fifteen thousand dollars to the
governor for his daughter's wedding so even if nobody here looks good the questions that are raised about the governor and the attorney general are pretty significant so what exactly is this f.b.i. probe is difficult trying to investigate well i think what's really odd is that there's nothing intrinsically illegal about these gifts according to virginia state law they're actually allowed to take these kind of gifts which is pretty astonishing but the governor and the attorney general did not disclose these gifts and you look at a pattern of this contributor the c.e.o. of star scientific whose company is under investigation whose companies lost money for ten years in a row giving money. to the governor for things like his daughter's wedding taking him on vacations. driving him around in his ferrari so i think what the f.b.i. wants to see is if there was a direct quid pro quo between the governor and avery's and gifts and state favors
that's you know probably going to be a relatively hard case to prove potentially but that's what they're looking into and michael i do want to clarify for our viewers what you said they virginia has a very a lack flexible ethics laws when it comes to officials politicians being able. to disclose their gifts and and so this is how it works anything over fifty dollars those politicians have to disclose on their forms but if those things are given to a direct family member those people do not have to disclose it so in the mr mcdonald's case he says that that gift that fifteen thousand dollars for it was given to daughter therefore he didn't have to disclose this now micro that being said is this convoluted case a result of those lax ethics laws i mean i think it's a result of many things including what is probably some personal corruption by the governor and also the attorney general but i think there's no question that having
laws like this which actually just allow i mean when you look at washington and we look at all the problems in our campaign finance system in the kind of real question of all things that are illegal even around that and then you take it to virginia and you're actually just saying oh well these give serve fine as long as the politician is ethical and doesn't act on them it's pretty shocking totally leaves the scandals like this and is kind of mind blowing the out of the well is the fest is that virginia is just so close to washington d.c. so that leaves a lot of other questions now two things first of all i want to bring up what we had a statement that was just recently sent to us by the star scientific company that is a company that is the dietary company and they said that they did not receive or seek any special benefits from the public officials and they were glad to be a part of any effort to promote business but they did not receive any help from governor mcdonnell now let's turn the conversation and move to cuccinelli and he's
the only now he's actually only now recusing himself from this case of the allegedly embezzling chef who's the one that shed light on all of this so first of all what took so long and is it a breach of ethics in your mind that it took him so long to do this. well the we should say yes that also the attorney general cuccinelli who's a candidate for governor now also received favors from this company then as you say was head of the prosecution in the chef case and the chef the in does aling chef has said that the attorney general was targeting him for political reasons i think it's obviously again it's incredibly questionable that the attorney general's only now recusing himself it's also incredibly questionable that he as well is only now disclosing his connections with this company as well very i mean i think it's really michael price for do so for the majority report i appreciate your time but we're out of it thank you so much all right five out of five stars that's what a glowing review looks like on the popular consumer of you site yelp from rush to
clothing stores the site has helped millions get the most bang for their buck and now it seems it's helping another discerning group in a much different way prison inmates are now taking to the popular site and using it as a sounding board to vent their frustrations about their conditions so far the reviews aren't too positive with many describing poor food quality unfriendly staff and average poor overall conditions the customer is always right as the old saying goes and it seems some behind bars aren't really taking very lightly but that's going to do it for now for more on the stories we covered go to youtube dot com slash r t america check out our website artie dot com slash usa and don't forget to tune in coming up next our very new show prime interest with perry and boring. wealthy british style. is not on supply list for.
markets why not it's going to. find out what's really happening to the global economy with mike stronger for a no holds barred look at the global financial headlines tune into kinds a report on. the worst you're going to face. the white house to have a day on the radio guy for a lot of ailing minutes from a quick coffee i want you to watch a quarter of a good good you've never seen anything like this on cold.
good afternoon and welcome to the very first edition of prime interest i'm perry and boring here in washington d.c. and here's the stories that we're keeping track of today. i have a good news america the treasury is in the green but only temporary the government said on monday that it would pay down thirty five billion dollars of its trillions of debt this quarter or this we can think higher than expected tax receipts but don't hold your breath because the treasury expects to plunge back into the red next quarter to the tune of two hundred twenty three billion dollars and that's with the fed buying about sixty percent of that amount don't worry though because bernanke says it's not monetization we'll talk about deficits and the debt crisis with peter schiff in a bit and one hundred years ago woodrow wilson to sign the federal reserve act with four gold pens a clear being i'm drawing on the gold reserves but yesterday representative kevin
brady called for evaluation of the fed he said when the house isn't on fire we want to discuss you know what role the fire department said play with this review shut down the quantitative easing firehose that sprang eighty five billion dollars in cash per month we'll have to see if this proposal can pick up steam one burning replacement is announced a later this year. and to mark another milestone as been one hundred days since the president's second term in a press conference this morning he warned of serious probable use of chemical weapons while cautioning that more evidence must be gathered before taking action he did warn that the regime has crossed the red line we'll take a look into the fine print of military spending in a special segment today and here's what's in your interest. i
i. i i. i and then the four and a half years since the federal reserve launched the first quantitative easing program according to the c m b c survey q will continue well and its thousand and fourteen i spoke with peter schiff c.e.o. of euro pacific capital and about how long interest rates can remain low and facilitate current u.s. deficit spending given the president's announcement today about the possibility of chemical weapons in syria i first asked if spending either military or domestic must be severely severely curtailed. this is the guns and butter argument right now we think and how close and as long as we can borrow money at practically zero
percent interest we can pretend that we can have both but eventually interest rates are going to rise and the governor's going to be forced to make some difficult choices there's going to have to be a lot of cutting going on and i think we're going to have to cut in both military and domestic because we're not going to all of florida a lot of these expenditures what do you think it's possible to reduce the debt and the deficit while the fat enables lower interest rates piece of a quantitative easing. well no i don't think anything is going to be accomplished constructively as long as the fed is spiking the punch bowl i think a prerequisite to a legitimate recovery is going to be sound money and higher interest rates right we're going to have to sober up we're going to have to check into monetary riyad we can't keep drinking and expect solve these problems. well i have here a graph of the federal funds rate sense the one nine hundred fifty s. were clearly and a long period of extreme easing stretching back to two thousand and eight now the fed has hinted at it as an exit strategy of winding down large scale asset purchase
a it's but i've heard you say that when he doesn't actually have an exit strategy for an atheist famous or infamous for saying he can reverse monetary policy and stem price inflation in fifteen minutes or so do you not believe him will at best that's wishful thinking but it's not going to happen you cannot reverse this monetary policy without imploding the economy that is based on a continuation of the cheap money we have created an economy that is completely dependent addicted to zero percent interest rates and quantitative easing if the fed takes that away the economy will implode so but they can't admit that they can't acknowledge that so they have to talk tough right they have to bark a lot but they can't bite because they have no he's well what about bernanke he still has the term deposit facility pretty were verse repos and the fed could always sell assets if it was backed against the wall you really don't think any of
these are going to work and sell the assets through who is going to buy them and at what price you know when the fed tries to unload all these mortgages and u.s. treasuries there are no buyers the fed is the buyer and the only reason other people are buying is because they think the fed is going to keep doing it based on the last minutes of the federal open market committee and speeches by various fed officials i think it's possible we might see short term interest rates rise towards the end of this year what do you think are going to be the net effects of that was that the economy can't handle it for a number of reasons the banking system can't handle a big increase and rates the mortgage market the housing market can't handle an increase in mortgage rates the u.s. government can't handle the increase in interest rates because it doesn't have the my. any to make the payments i mean look at all the pain that we have because of the sequester which were tiny tiny reductions in the rate of increase in government spending can you imagine if short term interest rates rose just
a little bit and the government needed an extra one hundred billion or two or three hundred billion a year just to pay the the added interest on the national debt i mean i may not be a real disaster that's going to happen eventually but i don't think there's any way the fed is this going to allow that to happen if it thinks it can postpone the pain by printing more money which i think is what we're going to do so i think what we'll see first is weakness in the u.s. dollar against other currencies you'll see a breakdown in the dollar index and a bigger increase in the price of gold a big reversal of the recent weakness we've seen in gold i think you'll see the dollar break before we see the bond market break because the fed will print all the buy if they have to to prop up the dollar but i think the break in the bond market will eventually force the fed's hand and it will not enable them to kenya to prop up the bond market and then we're going to have to deal with this problem well one of the arguments for higher interest rates is that it will help save areas
especially retired easy who are earning very low returns on bonds and have been for instance you risk your assets just to receive a higher rate so you don't think this is a good policy no it is a good policy we need higher rates the problem is big the economy right now can't afford higher rates given the enormity of the debt so what's going to have to happen when interest rates go up because a lot of the debts are going to go into default we're going to restructure the economy but you're one hundred percent right before we can have a real recovery we're going to have to have real interest rates we're going to have to have an increase in interest rates that encourage savings reward savings that discourage praful good consumer borrowing government borrowing so that our credit can be available to businesses to make the capital investments that we need to expand our productive impact capacity. hire people in real jobs and to grow our standard of living well how do we wean our economy off of this federal support. i don't think we could we did offer we got to go cold turkey but unfortunately you
know there's nobody wants to do that everyone's everybody wants to pretend that we can just keep on doing exactly what we did to create the crisis and somehow that's going to magically solve the problem do you think the u.s. can continue to hold the world's reserve currency status no not if we continue on this course i think the dollar is going to lose that status what's going to replace it i don't know i don't think it's going to be another currency i think that gold will be a more important reserve asset in the future than currencies and i think just smart central bankers particularly some of the creditor nations in the emerging markets will be taking advantage of the opportunity to buy more gold now that the price of come down and if some of these european indebted nations like cyprus or span or portugal or italy are forced to sell some of their gold i think would be very wise for these other central banks to snap it up way when we see this transfer of gold where do you think it's going to go i think it's going from the west to east from
the debtors to the creditors you know and that's the shift of wealth and you know when you become rich you can afford to own more gold when you're broke because you borrowed too much money you end up giving up your gold and you think the u.s. is going to have to sell off their gold reserves as well. well i think we're going to need our goal reserves i hope we don't sell them off i hope we don't i'd rather see a restructuring i think we're going to need all the gold we have because when the dollar collapses i think the only way to really restore confidence in the greenback is going to be to back it by goal and so we're going to need those reserves in order to accomplish that right now crude oil production is up and with technology and fracking and natural gas is it possible that this could take us from a trade deficit to a trade surplus is the potential for energy independence independence and that it gating factor in what you consider the real crash. well mitigating factor maybe in that it's better that we develop these resources than now we not have them at all
or not develop them but it's not going to take us from a deficit to a surplus eventually we're going to go to a surplus but not because we export so much oil but because we import a lot less of everything else because the dollar collapses and america stop shopping so eventually we're going to balance the books we're going to have to have a surplus and we are going to use a lot less energy as a nation because americans are going to be poorer we were already losing using a lot less energy than we used ten or fifteen years ago because we're poor because fewer americans are in the workforce but that trend is going to continue as you know we're priced out of the market and as people in other countries other nations whose currencies are going to be gaining in value they're going to start consuming a lot more energy we're going to have to supply them with that energy and it's going to be a good thing that we have it because we're going to need to export it but it is not a panacea it's not like you know we're not going to have any disruptions in our standard of living that we're not going to have to dial it down because we've got
all this oil we don't have that much oil is better that we have what we can develop these reserves that we have but believe me it's not to get a free card not not even close ok i want to talk about a piece that you wrote and investment news that i read titled lessons learned from japan and one point that you brought up is that on one hand we criticize the policies of countries that artificially the deflate currencies to biggest export such as in china but then on the other hand christine legarde and ben bernanke he supported japan's policy policies of massive easing which has weakened the yen so what's ok and what's not ok as it pertains to currency devaluation. well i mean japan's policies have been a complete failure i mean a lot of people want to point to the mistakes of japan particularly here in the u.s. yet repeat those mistakes you know japan has had this monetary easing policy for what two decades now and it hasn't work so now they're just going to increase the
size of the quantitative easing they're printing more money there they're trying to create inflation as if that's how you create economic growth it's not i mean if inflation led to economic growth in zimbabwe would have been the growth growth capital of the world it's sound money it's deflation that is more conducive to economic growth it's when prices go down to zero that's what happens in a vibrant growing economy you produce more and prices go down and your standard of living rises they've got it backwards in japan they think if they can just make prices go up the country will be more prosperous well they're going to get higher prices you know sometimes just say be careful what you wish for because you might just get it you know they just had to first price increase and mcdonald and five years in japan they raised the price to hamburgers now twenty to twenty and i have not been announced and lou even time to know i am going to leave it at look now i suppose that's great news for the japanese maybe for years they were bored every time they went to mcdonald's
a burger was exactly the same price now because they're going to pay twenty five percent more for the exact same hamburger somehow this is going to be a boon for the japanese economy you know the crazy thing is they think they're going to create more consumption more demand by debasing their currency they're going to destroy demand because they're going to destroy the value the currency when prices go up you buy less you don't buy more when prices go up supply and demand means that as prices go down that's what stimulates consumption you demand more of things as the price goes down not as the price goes up so they're going to create inflation in japan but it's not going to lead to economic growth if anything it will lessen the. growth and so this is going to backfire and you know we should learn that because you know we're following in their footsteps only we're doing it from a much weaker position and i think japan despite all their mistakes is in better shape than we are or maybe we're in worse shape than they are maybe a better way to put it. the prime minister of japan is devaluing the yen by
doubling the monetary base within two years japan has the highest debt to g.d.p. ratio in the world and spends a fourth of all tax revenues on debt obligations that was peter schiff from euro pacific capital from lincoln to bush to obama funding wars has always been a challenge next we'll look into the fine print of creative wartime spending then our t.v. producer bob inglis and i will debate in s.c.c. will the bank of wal-mart and virgin in space all of this up next. hour of. sleep.
relevant stories unique perspective from tom my skin's dark. wartime financing is always a challenge but governments are never short of creative solutions will explore how the iraq and afghanistan wars have been financed off budget but first history offers an instructive insight so let's take a look at what president lincoln and his treasury secretary salmon pj's did during the civil war just a few months after iraq did the northern treasury faced record gold outflows to stop this link and chase simply halted gold convert ability which brings us to the age of greenbacks unbacked paper currency it would prove
a disaster as the money supply nearly doubled into eight hundred sixty three and along with it wholesale prices secretary chase outlawed speculation and gold markets to stop the greenback devaluation but he was humiliated time and again and eventually forced to stop printing greenbacks as price inflation soared chase and link and then decided to finance the war with good old fashioned debt and to guarantee there would always be a buyer of the new treasury securities they step and national banking system that used the debts as reserves this would lay the groundwork for the federal reserve fifty years later the south also experimented with money and the result was hyper inflation without the capital base and strong banking system of the north that are a sea of fine as nearly their entire war with money printing after the civil war the us continued to finance its wars by issuing debt here's what defense spending looks like. good for inflation since the one nine hundred forty those peaks and out
waves massive stress on the economy nearly all of the money spent on war to the korean war and vietnam was accounted for on budget but that changed with iraq and afghanistan and since two thousand and one the pentagon has taken advantage of an old trick to finance its dream budget from souped up tanks to bomb dropping drones and state of the art command centers their wish list has been filled year after year now in normal times the u.s. budget goes through a lengthy and heavily scrutinized congressional process but if there's an emergency that requires additional funds that can't wait for next year's budget congress can pass a supplemental appropriation now this is the tool that pres the president can get immediate emergency funding for war and natural disaster historically supplemental appropriations were calculated into the future cost of war and then put back on budget but as we can see from the green line from two thousand and one to two thousand and eight emergency funding grew each year from thirteen billion to one
hundred eighty seven billion dollars the pentagon is addicted to this stealth financing because it rarely gets checked and as much as two hundred billion dollars since two thousand and one is accounted for for instance in two thousand and nine congress one hundred six hundred million dollars for a fleet of twenty two raptor fighter planes but the request in the department of defense budget was denied in the end the congress simply simply stuffed the twenties who requested that your supplemental and it was automatically granted to this day thereafter has never been used in iraq or afghanistan. lincoln and chase thought they were smarter than the market when they waged war on gold in favor of greenbacks perhaps the pentagon will get a similar lesson when short term interest rates evidently rise and the market no longer accommodates one hundred billion dollars slush funds and this completes our book into the fine print of military spending.
now it's time for the daily do all joining me is bob english prime interest producer great to be here thank you for joining me so the jobs act which is the jumpstart jumpstart our business start up act is being rolled out and signed into law last year is supposed to make it easier for businesses to raise capital now as you see as opposed to let's lift the ban on general solicitation which limits how private companies can raise capital exactly they've kind of been dragging their feet on this but the f.c.c. and its defense it's all leadership change mary mary shapiro stepped down now that white has come in well mary shapiro's said that she did not want to be tagged with
an investor legacy and then so hurt her it from a position comes and her interim chairwoman comes and she's dragged in front of congress and congress says to her why are you dragging your feet and then we have this new chairman and she's this new chairwoman says that well we have to do this now so suddenly it's in the balls court of the f.c.c. to implement these new rules and this has to do with the creation of an opportunity for business to raise capital that in the private markets through general solicitation there's a lot of questions with this rule so we will say that mary jo white once opposed the rules through and then deal with them better protections later however. i don't know if the rule even protects investors or not well that's that's up for debate because the funny thing about this rule is that when it comes to raising capital in the private markets when you have a general solicitation you can advertise on the company's website you can advertise in print but this doesn't necessarily mean that the protections will be afforded for accredited investors i mean why does it really matter and encouraging and best
in this in this instance has to have an annual income of greater than two hundred thousand dollars or a net worth of greater than a million dollars exactly so basically you have to be an investor. no you don't have to be rich to be an investor to be an uncredited investor but the whole point here is that you know if you're going to be an income if you're going to be an accredited investor you don't necessarily have to be rich but. well i think the real question of the day is involved markets have a bank so the f.c.c. has a new are actually a dodge frank implemented a three year ban on commercial firms from owning and duster alone companies this expires in july we know that wal-mart has looked after a charter for a bank for several years they dropped that in two thousand and seven and some speculate they might still want to charter i don't know do you think wal-mart should be allowed to start
a bank well that's an interesting point because wal-mart is already in the banking industry and in mexico and canada in the u.k. and they're already in the bank and the banking industry to an extent in terms of cash trucking and bill payment in the u.s. and they would love to get into the business of providing loans because that gives them protection it does not give them access to the discount window but that's another story well some people believe that. commerce however this dodge for a moratorium only applies to firms that have less than fifteen percent of their assets tied to financial activities so you can have still eighty four percent of your business tied to commercial commercial activities and still enter the financial services world which we've seen with wal-mart they have bluebird which is the prepaid debit card that they work on american express and this is an interesting way for companies to get into the banking system and i think we're going to see a revolution in the payment system in the company in the coming years and there is
a backdoor way through the federal regulation federal reserve regulation double for debit card issuers of prepaid debit cards to get into the banking industry and they can only have four or five billion dollars of assets to do so but what we're going to see is servicers like wal-mart have cash servicing centers be able to cash your bills and provide a whole new range of services in the coming years and they're not necessarily going to have to be a bank holding company to do this so maybe the question is not should wal-mart be allowed to have a bank but how is wal-mart's going to find the. exactly eventually with and it's quite possible that we're going to be we're going to be seeing the repeal of the bank holding company in the next few years and that would open up a whole range of options for non-bank players to enter the financial realm and i think that to be an exciting time we're going to see tech come in and really revolutionize the way that retail banking is done today but i also feel that wal-mart has done a very good job of reaching middle income classes and i feel that if they were going to charter a bank that they would probably serve as low to middle income households who have
a hard time getting capital anyway i mean it's interesting that you say that because the whole the whole premise beatup behind this debit card prepaid debit card movement is serving the unbanked and the under bank and this was a this is something that's been founded by or are funded by the force problems ation and it's been worked on for a number of years about it we're just seeing it come to fruition now another development that happened just yesterday sir richard branson broke the sound barrier version the acting spaceship to completed its first its first supersonic flight test now the ship can hold six passengers two pilots it actually launches off an airplane and then the rocket the white knight launches off the airplane and they can get up to three hundred sixty one thousand feet and then you're in the air for five minutes of waiting that's the goal now the rocket only fired for sixteen seconds i'm just going to rattle off a few statistics here that is printing eighty five billion dollars dollars
a month ok that amounts to one hundred eighty million dollars an hour or five hundred twenty four thousand dollars over that sixteen seconds so we want to be a prime interest if we didn't tie everything and see exactly. and that's our end to all things are joining us. it's been a day of milestones day one of our prime interest one hundred days of obama's second term in one hundred years for the bad all worth the radio we popped the debt bubble with peter schiff and then enter view that was much more sustainable than our fiscal path then we delved into the fine print of creative wartime spending and
the same with the dual over new rules for capital markets and they calculated of the extent philosophy of q.e. good luck mr branson thanks for watching and make sure they come back tomorrow to be sure to follow us on facebook at facebook dot com slash prime interest and from all of us here at prime interest have a great night. welcome to. here you can feel it.
there are three choices you like first the work you know on the pillow go to live on a miserable way like a slave. for the second is to jump to the wall and catch the american dream. most of them are and lose their loss. illusional i wish mr become a number of an organisation and get inside the drug trade. it was something born never forgot. to pay the. bill to somebody who did it but i paid for what i've done that would never stop paying.
the libertarian party he'll talk to us about the recent militarization of police and foster bill so american foreign policy that and more coming your way. and an f.b.i. fact a bill being drafted by a u.s. task force would punish high tech companies if they refused to comply with wiretaps so what does this mean for your civil liberties we'll investigate. and the f.b.i. is looking into virginia governor bob mcdonnell relationship with a corporate c.e.o. the c.e.o. even cater the wedding of the governor's daughter is this another case of buying influence will question more.