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tv   The Big Picture With Thom Hartmann  RT  April 30, 2013 8:00pm-9:00pm EDT

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coming off our t.v. tonight we're joined by a special guest gary johnson the twenty twelve presidential candidate for the libertarian party hope on to us about the recent military as ation of the police force in boston and also american foreign policy that and more coming your way. and f.b.i. back bill being drafted by a u.s. task force would punish high tech companies if they refuse to comply with wire taps 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 the corporate c.e.o. the c.e.o. even catered the wedding of the governor's daughter is this another case of buying influence will question more.
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it's tuesday april thirtieth him in washington d.c. i'm going lopez and you're watching our t.v. . starting off this hour a look back at the events that laid siege to an entire city just over two weeks ago the city of boston experienced terror firsthand during one of its most celebrated sporting events as a manhunt ensued to find those responsible for the attack law enforcement put the city on lockdown going door to door using all means necessary to catch perpetrators now as we all know the exhaustive search actually turned out to be successful and after shutting down the city the f.b.i. along with local law enforcement agencies were actually able to apprehend suspected bomber dzhokhar sar naya alive but not all is this is seeming seems to be a triumph former texas congressman ron paul along with many civil libertarians fifty events in boston more as a worry than a win in
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a recent off at pace paul wrote he said quote the ostensible reason for the military style takeover of parts of boston was that the accused perpetrator of a horrific crime was on the loose the boston bombing provided the opportunity for the government to turn what should have been a police investigation into a military style occupation of an american city this unprecedented move should were should frighten us as much or more than the attack itself so are we indeed trading away our safety for our security i was joined earlier by former new gov new mexico governor gary johnson we started off by talking about the boston bombing. you know it just raised a lot of a lot of issues with me the fact that the boston police handled this the way that they handled it i think that was their prerogative but the questions that really arise are due process who was looking over the shoulder.
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of the police to determine if in fact what they were doing was constitutional and of course it's it is well we're doing was legal in this because of the patriot act you know for the men of the constitution due process who's looking over the shoulders of the police to determine if what has gone on is lawful meaning constitutional well the patriot act throws all that out so and then it raises questions about drones drone surveillance those those that said we'll gosh we could have unleashed drones in this situation well no you can't because who then looks over the shoulder of the operator of the drone that ultimately may pull the trigger and now and then when you start talking about militarization of drones meaning armed drones or surveillance drones and as long as there is due process that's that's the real key here and apparently that was thrown out the window and
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that's because of the patriot act this is these individuals who are not read their rights they were treated as guilty as opposed to innocent until proven guilty and that's one of the things i was to ask you about because you're talking about the constitution you have not due process there was a big question over the miranda rights and whether they should have been read to somebody that was a potential terrorist suspect and then you can't help but be kwaito or or when you start focusing on how we may have used drones in this situation and the outcry over well no you really can't use drones because there may have been innocent people killed don't why can't we make the connection with what we're. doing overseas with drones and the fact that we're killing innocent people overseas and that's one of the reasons why the united states is so vilified for its military interventions well let's talk about drones for a second and we have up until up and coming libertarian rand paul who on one hand
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is that holding the epic filibuster to actually get more information about drone surveillance and on the other hand you have him going on fox business news and saying that it doesn't matter to him if a person shoots somebody in a convenience store and we use a drone personnel so talk about this juxtaposition between his libertarian views and yours well having a drone for surveillance when it is look when there is due process when there is a judge that says yes very quickly yes we need to we need to send a drone into a situation like this for surveillance but if you're going to arm a drone in a situation like that megan i think you're going to have unintended consequence and that unintended consequences is it's not a it's not a trained military sniper of a helicopter it's somebody operating this remote control and they're going to they're going to pull a trigger a remote control somebody that's innocent is going to end up hurt or killed in this
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situation and now i'm back to this why can't we make that connection we're outraged over what i just said why can't we make that connection with what's happening overseas when it isn't a bullet that's being fired it's a bomb that's being dropped and no we don't kill the we don't just kill the intended target we kill dozens if not hundreds of other innocent people in a given situation and carry what you're saying it is echoed so many times in other libertarian points of views when they're talking about foreign policy so let's talk about foreign policy right now today president obama spoke with white house reporters and he said that the crisis in syria is growing hig knowledge the fact that chemical weapons might be being used in syria but he doesn't know by whom so let's take a listen to what president obama said and then we'll talk about it. what we now have is evidence that chemical weapons have been used inside of syria but we don't know. how they were used when they were used to use them we don't have
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a chain of. custody that establishes what exactly happened. and when i am making decisions about america's national security and the potential for taking additional action. in response to chemical weapon use i've got to make sure i've got the facts. he wants to make sure he has the facts now this is something that a lot of people who are there president bush didn't do before entering iraq with the weapons of mass destruction is it fair to compare syria with iraq the weapons of mass destruction with the alleged chemical use i think i think it is it's get all the information and after we've gotten all the information let's look at our military interventions in the past i suggest to you that there is not a military intervention in my life that has been warranted and hasn't resulted in consequences that. are unpredictable from the start these
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milla to our military interventions have resulted in hundreds of millions of enemies to this country but for our military interventions i don't think would otherwise exist so you're talking on interventionism does it ever come to a point because right now what we know in syria is that at least a seventy thousand people have died in the civil conflict that there ever come a point in your mind where we need to say ok it's time for the u.s. or another air national body to step in and help those people it's you know when you talk about it just like you've talked about it who cannot say gosh this is something we need to consider but the reality is is that when you when you look at our past actions when you look at our past interventions you said seventy thousand people have been killed when you look at our past military interventions our military interventions result. another hundred thousand losing their lives but somehow that's justified because it's on the side of good it's on the side of the united states and i'm being facetious being facetious our military interventions
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don't end up improving these situations and obviously that was the case because we did that back in the rebels that became al qaeda back in the one nine hundred eighty didn't we learn anything when it when it came to afghanistan so let's talk about the history that the u.s. has so let's talk about saddam hussein let's talk about iraq ok now when it comes to iraq we have prosecuted well the interim national body actually prosecuted saddam hussein he was killed for killing one hundred forty eight people using chemical weapons right but in two thousand and five in fallujah didn't we do the same thing with white phosphorous well i'm not familiar with that particular situation that you're talking to talking about but it is hypocrisy it's absolute a parker see the fact that our military interventions are ok that that the foreign despot we're now promoting taking over from the forum does but that we didn't like
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ends up being somebody we don't like in the future and i'm talking about mubarak you know mubarak we backed mubarak but but we now openly admit that yes he was very corrupt and this was a horrible horrible situation but that he was better than what would have been we're making these determinations we should that be making these determinations and it's because of the fact that the reason i was bringing up the foolisher incident is because some of the upper officials of the bush administration are now saying yes war crimes were committed do you think that they should be punished or do you think they will be punished even well they should be punished work crimes should be punished no one is immune from liability of breaking the law what about the bush administration well in this case if the law. was broken there should not be immunity from that kind of prosecution ever so let's talk about want to obey obviously are against. we know now that there's a hunger strike going on well what i'm on i'm against megan is arrest and
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detainment without being charged all i also recognize that one ton i'm obey as a facility may be a facility that we need meaning housing enemy combatants that there is no place for arrest and detainment without charge that practice has to stop guantanamo bay as a facility maybe a facility that we need i wish. president obama were a lot more transparent on why he didn't shut down guantanamo while i have a sense that gosh this is a facility that if we shut it down we're just going to have to duplicate it somewhere else arrest in detainment torture stop stop so what would a president johnson have done when it comes to guantanamo bay i would have shut down the practice for which we think one ton of obey should be shut down for which is arrest and detainment without being charged and torture that is not something that we should be. any part of that's what we fought wars over gary johnson thank
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you so much for joining us two thousand and twelve presidential candidate for the libertarian party gary johnny thank you you thank. and now it's a bog airfield one of the biggest air b. bases in america's ongoing conflict in afghanistan this is the civilian cargo plane which crashed on monday outside of kabul resulting in the death of all seven crew members on board all of them were american the plane belonged to a military contractor national air cargo it was supposed to be headed towards a dubai in the arab emirates filled with vehicles and routine general cargo according to a national air cargo statement now the plane crashed shortly after takeoff there was no enemy fire reported when the plane confines and the video does not show any missiles or other live ammunition approaching the plane however despite this lack of visible weaponry the taliban has already claimed responsibility
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a spokesperson for the international security assistance force said this morning that the crash was the cause the cause of the crash is still under investigation. well it's a spy or not to spy that question might not be up for debate for too much longer when it comes to cyber surveillance and that's because a government task force is coming up with legislation to actually force companies to find a way to allow agencies like the f.b.i. to monitor online communications in real time or face crippling penalties now despite promises of saying privacy to their customers soon companies like facebook and google could be required to rewrite their programs and create a backdoor monitoring tool to actually help the government intercept communications as they occur but cyber command companies are not going down without a fight to discuss this i was joined by he munch to a nigam he's the founder of s.s.p. blue and i began by asking him if the government is actually forcing these
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companies to do their dirty work. the actual positive side of this is not so much that the government's trying to have the companies do the dirty work the good part of that statement is quite the opposite the fact that the government is actually saying to companies you go figure it out but you have to do it there's a silver lining 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 what it mean that anything we save in our cloud for instance or that we see through google
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glasses or even our keystrokes and 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
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a wiretap order comes in then you could be monitored every stroke every conversation you having whatever the case may be it is possible that's the direction this is headed by him what guarantees are there that this back door wouldn't be abused or what have judicial oversight when the f.b.i. need to in order to access this customer information great 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 perfect examples of companies that do and amazing amount of work to protect your privacy so when a government comes say with a search warrant or subpoena they still put it through the rigamarole their systems
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in place that publicly many people don't realize this their systems and. 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 you 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 happened 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 the rights of a hack they did that to protect their customers now what they are asking what the government and this f.b.i. possibly half of these companies to do is to find ways for them to be able to to
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your 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 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 the corruption point and figure out what's being said and therefore the whole idea of encryption goes out the window and that was him much unicom he's the founder of s.s.p. blue. well to virginia now where a seemingly simple case is getting more complicated by the day last month the former chef who worked at virginia's executive mansion was indicted with four felony counts of embezzlement for allegedly using state funds to pay for food for private events ok so the guy still food case closed right well not even close
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instead the shaft todd schneider actually told authorities that his boss might not have been such a hiatus to such a stellar reputation either that prompted an f.b.i. probe into the ties between for general governor bob mcdonnell his wife maureen 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 is running for governor and also was going to be the person responsible for prosecuting the chef until he recused himself because of a possible conflict of interest well to help untangle the story i was joined by craig coleman has a government affairs lobbyist at public citizen and i began by asking him to break this whole story down including the key players. well first of all this story is beginning to read like it with all the intrigue of a fascinating mystery novel including you know embezzlement saft betrayal
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this is all starting to come out what's happening is in the state of virginia they literally have almost no campaign finance laws and no ethics laws other than disclosure so anybody any company for ensign's can make unlimited campaign contributions to a lawmaker can also provide unlimited gifts as long as those gifts and campaign contributions tend to be disclosed well this story started breaking a little while ago when it turned out that one company named star scientific paid fifteen thousand dollars as a gift to help finance the wedding of the governor's of the governor's daughter you know it turns out since that was a gift to the governor's daughter rather than to the governor it was not subject to disclosure the story broke by back channels and it right away the governor said well didn't have to disclose because it wasn't a gift to him well it turns out with some investigation into this wedding the
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governor was signing most of the contracts for the wedding there was leftover deposit on that fifteen thousand dollars gift from star scientific and that went to marine the governor's wife so it wasn't even returned to star scientific that immediately started raising red flags as what's going on and so other people started taking a look at what is star scientific doing in the state of virginia turns out they've given about one hundred twenty thousand dollars in campaign contributions to governor mcdonnell as well as guess they've been flying around the country on the corporate jet they have been paying for vacations for governor mcdonnell as a luxurious lake house resorts and providing other types of gifts. as a result you know one has to start taking a look at what is star scientific getting back in return and that has now become
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the focus of a department of this investigation now star scientific says that it does not appear to have a first aid any grants or financial assistance from nick macdonald's term that it never sought or received any special benefits but let's talk about some of the other city dailies einar south are under investigation right now it will first of all let's talk about what star scientific may have gotten directly from mcdonnell there have been at least two events that we know of in which the governor and his wife hosted essentially a sales product party for star scientific to pitch their product. to buyers and consumers one of those events was even held within the governor's mansion where the governor showed up along with maureen mcdonnell touting the virtues of our scientific and what an excellent product they have at another time marine mcdonnell actually traveled to florida to once again pitch star scientific
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and their products down at another event so there is a direct link going on between you know the gifts that the mcdonnell family's getting and what they are giving back whether this is quid pro quo corruption is the subject of the department of justice investigation that's by the way very difficult to prove i mean they've in the f.b.i. the department of justice actually has come up with evidence that the mcdonnell family did these official favors for star scientific specifically in exchange for the gifts that they received a very difficult standard to prove but that's what the department of justice is undertaking specially considering the fact that they're saying that they're friends with the pharaoh williams you know that's something else that really needs to be taken a look at it turns out that they haven't been friends for that long they've been. friends for roughly the time that mcdonnell has been become governor as we have got a company that you know appears to be wanting to get someone to kind of favors from
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the state government providing lots of gifts to the governor this is not a long term friendship they were friends like back in high school or college before mcdonnell became governor they became friends when there was a business relationship going on and by the way i do want to emphasize it stars scientific i mean this appears to be a pattern. of abuse by a star scientific you mention can and cuccinelli who's the attorney general who's doing the investigation of the chef well he was also the next presumed the governor of virginia and we now know that he has been very actively trading buying and selling stocks in star scientific so once again we're seeing a return back to a company who clearly sees something at stake if they can just get their foot in governor's mansion let's talk about that investigation that they're also facing right now star star scientific star scientific is also under investigation for
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stock frauds now what this involves nobody really knows at this point all we know is that it's part of the official investigation we've just heard about it you know in news reports and i do have to emphasize though that this does raise red flags i mean when you've got the next pending governor of virginia buying and selling stocks in star scientific and at the same time star scientific is under investigation for securities fraud. you know this just raises red flags one has to wonder what's going on here we have a very short not time left but what does this say about the bigger narrative of virginia and its lax ethics laws that says virginia needs to toughen their ethics laws a of. nothing else i mean even if you don't want campaign contribution limits it's a gift and on the books companies that want to get some sort of favors out of the governor's mansion should not be giving free gifts to the governors should not be
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flying the governor around on their corporate jets and should not be wanting into any big open or at least going to give them that was quite a home in a government affairs lobbyist at public citizen. while for years now politicians and the public have relied on opinion polls to take the pulse of the nation but what happens when these polls reveal that politicians in the us simply ignore the will of the majority of the population the residents laurie harvest has more. than are told because who are these random people that actually participate in them
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i don't participate in them so how should i believe that they're accurate and also polls can be skewed to back whatever opinion you want them to back but today i'm talking about a lot of polls because sometimes you don't even need to take a poll to prove whether or not something is true this is true in the case of one recent gallup poll in particular it's found that in the us the public approval rating of congress has plummeted to fifteen percent as an only fifteen percent of americans approve of the way that members of congress are representing them why should anyone approve of the job congress is doing when they still clearly ignore the desires of the people they are supposed to represent. for instance another recent poll indicated that more than ninety percent of americans support making background checks for gun purchases mandatory not sweeping gun control just
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a simple background check but congress refuses to do that clearly congress isn't representing the american people on this issue clearly they are representing the desires of the and are a who spent eight hundred thousand dollars lobbying in washington in the first three months of this year alone another poll indicated that seventy three percent of americans want to work toward a reduced reliance on fossil fuels but you still see the government pushing forward with building pipelines and fracking and other fossil fuel based endeavors clearly congress is more interested in representing oil companies who spend millions lobbying in washington than they are representing american citizens. another recent poll indicated that forty five percent of americans say they would not willing to give up personal freedoms in order to reduce the threat of terrorism but the american government constantly chips away at the freedoms of the citizens in the
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name of national security they do it through increased a video surveillance legislation that allows the government to spy on citizen bottom line you name it it's corporate tax breaks bank bailouts and less wars congress repeatedly votes in ways that go against the will of the people so whether or not you agree with the findings of the polls i've just mentioned i think most americans will agree that our government is more interested in representing corporate interests than those of the people they are sworn to represent and no one needs a poll to prove that tonight let's talk about that by following me on twitter at the residence. all right that does it for now i'm going lopez have a wonderful night. good
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afternoon welcome to the very first edition of prime interest i'm perry and boring see 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 for 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
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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 let's 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 of clothing 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 spraying eighty five billion dollars in cash per month we'll have to see if this proposal can pick up steam when bernie 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
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weapons while cautioning that more evidence must be gathered before taking action he did warn that the regime has crossed of the graduate i will take a look into the fine print of military spending in a special segment today and here's what's in your interest. i. am paying the four and a half years since the federal reserve launched the first quantitative easing program according to the c m b c fed survey q.e. will continue well into two 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
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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 we can have both 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 government'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 real afford 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. a prerequisite to
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a legitimate recovery is going to be sound money and higher interest rates we're going to have to sober up we're going to have to check into monetary rehab we can't keep drinking and expect to solve these problems. 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 so do you not believe him now will it 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 cheap money we have created a con of me that is completely dependent addicted to zero percent interest rates
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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 teeth well what about bernanke he's told he has the term deposit facility pretty were verse repos and that's 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 handle it for a number of reasons. as the banking system can't handle
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a big increase and raids the mortgage market the housing market can't handle an increase in mortgage rates the us government can't handle the increase in interest rates because it doesn't have the money to make the payments i mean look at all the pain that we have because of this of questar 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 would 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
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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 bio they have to do 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 is a lot of the debts are going to go into default we're going to have to restructure the economy but you're one hundred percent right before we could 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 incur. savings reward savings that
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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 to hire people in real jobs and to grow our standard of living well how do we wean our economy off all of this federal support . i don't think we can weed it off it we've 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 reserve currency status you know 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 critter nations in the emerging markets
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will be taking advantage of the opportunity to buy more gold in price and 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 the 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. while i think we're going to need our gold 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
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order to accomplish that and we're now crude oil production is up and with technology and fracking and natural gas is it possible that this could take us from the trade deficit to a trade surplus is the potential for energy independence independence and mitigating factor in what you consider the real crash well mitigating factor maybe in that it's better that we develop these resources that 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 then surely 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 americans 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 we're 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
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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 i'm hand christine legarde and ben bernanke he supported japan's policy policies of massive easing which has weakened the yen so what's ok
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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 and 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 if you place it that is more conducive to economic growth it's when prices go down well 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
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prices you know sometimes just say be careful what you wish for because you might just get it you know they just had the first price increase in mcdonald's i thought at 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
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it will lessen economic 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 now 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 because better way to put it. the prime minister of japan is devaluing the yen by doubling the monetary base with until years japan has the highest debt to g.d.p. ratio n. 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 and as you see rule the bank of wal-mart and virgin and space all of this.
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old. technology innovation all the developments around russia we've got this huge area covered. a little worse for the little things only i don't. want. to give you never seen anything like.
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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 inside so i 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 lincoln and chase simply hold the 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 wife 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 lend and
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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 set up a national banking system that uses the debts as reserves this would lay the groundwork for the federal reserve fifty years later the south also experimented with the money and the result was hyper inflation. the capital base and strong banking system of the north the confederacy of finance 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 adjusted for inflation since one nine hundred forty those peaks and out waves put 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
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wish list has been filled year after year now in normal times the us 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 costs 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 financing because it rarely gets tagged 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
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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 and 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 and 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
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producer great to be here thank you for joining me so the jobs act which is the jump start jump start 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 at the s.c.c. as opposed to let's lift the ban on general solicitation which limits how private companies can raise capital exactly the kind of been jogging their feet on this by the i.c.c. and its defense it's all leadership change mary mary shapiro step down now there you know why it's come in well mary shapiro's said that she did not want to be tagged with an investor legacy and then saw her in her interim 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
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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 and 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
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here is that you know if you're going to be if you're going to be an uncredited investor you don't necessarily have to be rich but. well i think the real question of the day is. have a bank ok 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 so people still 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 in 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 the loans because it gives them protection it doesn't give them access to the discount window but that's
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another story well some people believe that. commerce however this died 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's a backdoor way through the federal delay should 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
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to have to be a bank holding company to do this so maybe the question should wal-mart be allowed to have a bank but how is wal-mart's going to have. find themselves what exactly it is a rep of 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 it's going 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 service 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 people 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
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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't get up to three hundred sixty one thousand feet and then you're in the air for five minutes of waiting that's a cool 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.
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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 a calculation of the extent philosophy of q.e. good luck mr branson thanks for watching and make sure to come back tomorrow and be sure to follow us on facebook at facebook dot com slash prime interest and from all
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of us here at prime interest have a great night. welcome to teal one day here you can feel. the earth three choices you like first used to work on the pillow go to live on a miserable way like
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a slave. the second is to jump the wall and catch the american dream. most of them. carson and lose their love. is to become a member of an organization and get inside the growing trade. to buy something for never forget. a. good sign believe didn't find the need for what i've done or will never stop paying. that.
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much. you live on one hundred thirty three bucks a month for food i should try it because you know how fabulous bad luck i got so many i mean. i know that i'm sitting in the same city really messed up. and we're all very so personally apologize and. worse you're going to
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fly down superman the radio guy in fort lauderdale minutes from a cricket. club or a politician because you've never seen anything like that and i'm telling. you. lots of guys i mean martin this is great on the sets when you hear about big banks running away with millions of dollars in taxpayer funds for their bonuses.


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