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  • So let's just start with the back story, the Steve Bannon kid, the brawler, your brother said. In what way?

  • Well, I mean, it's a—our neighborhood became, it was kind of, you know, white, working class, lower middle class,

  • old, internal suburb of an old city, Richmond [Virginia].

  • So I was inside the city limits, very close to downtown, and it became predominantly black in the '60s.

  • And my parents, you know, wouldn't leave; that was our neighborhood.

  • So it was a prettyyou know, it was a fairly toughthe north side of Richmond is a fairly tough section of town,

  • and you just kind of, you know, you just—I was raised in a working-class, Irish Catholic family,

  • went to a military prep school, and I was just kind of a, you know, justjust raised to not back down.

  • If you believe in something, you believe in something.

  • And you can't—if you show any weakness in a neighborhoodit's quite Darwinian as a young person, right?

  • If you show weakness, you're going to just get picked on and bullied and all that.

  • So you've got toyou've just got toyou just learn from the playgrounds, and you learn from the schools and the sports.

  • You know, there's no big, organized Little League or anything like that;

  • everything was kind of inner-city baseball leagues or basketball leagues, etc.

  • You just learn you've got to stand up for yourself, and you've got to fight.

  • And if you fight, people give you some space.

  • And if you don't fight, it's justyou know, it's not a great life.

  • So it was justand it wasand it wasn't any big deal.

  • It was kind of like breathing air.

  • So I remember the story about your dad that you told that almost felt like one switch gets turned on,

  • and young Steve Bannonyou're a grownup by then, but it goes to this idea of trust,

  • trust in the government, trust in your company, trust that your dad had in his retirement accounts.

  • Well, look, we're Irish Catholic.

  • The Catholic Church, the Bell

  • my grandfather and father I think are the only two guys in the history of the Bell System to be both 50-year employees.

  • My grandfather worked there 50 years as a lineman and a PBX [Private Branch Exchange] guy,

  • and my dad was 50 years, started in the sewer pulling cable and worked for 50 years.

  • So as a father and son worked 50 years for the phone company.

  • You had these big institutions.

  • I was fortunate enough to be raised in a great time in America, right, the '50s and '60s.

  • But you believed in these big institutions: the Catholic Church, the phone company.

  • And these were, you know, permanent fixtures in your life, and it was kind of that stability.

  • I came from a neighborhood that was a little bit tough, but it was not likeit was a very solid, great background.

  • As I go throughout the world and meet these very wealthy people I deal with all the time and see their kids,

  • the greatest thing you can give a kid is that kind of basic, core, loving family that's there and rock-solid.

  • So the family, the church, the community, the phone company, these are institutions.

  • And so institutions are everything.

  • It's a very institutional life when you think about it, and quite hierarchical.

  • But it gives you a set framework that you can grow and be

  • you know, get to be an adult, and there's a real sense of, you know, something that's solid there, something that's real.

  • I think that's what broke down the financial crisis.

  • I mean, my father would rather

  • he would tell me stories back in the Depression about one of the things

  • about his father working at the phone company is that they never laid anybody off during the Great Depression.

  • My dad was born in 1921, and as a very young person, he remembers all the neighborhood fathers got let go.

  • His dad still had a job; the phone company didn't let anybody go.

  • He also told stories about the, you know, borrowing againstthey had like one or two shares of stock,

  • which was everything, and they would borrow against the stock to like buy the house and buy

  • I think the house cost like 2,500 bucks or something in the '30s to build.

  • They borrowed against their AT&T stock.

  • AT&T, the Bell System, incentivized working-class people

  • to put X amount of their income away and actually become a shareholder.

  • And being a shareholder in the phone company, that's where my dad's entire net worth was.

  • And so, when, after the collapse, a couple days after the collapse, when Cramer went on TV,

  • Jim Cramer went on TV on CNBC and that morning just goes,

  • Hey, if you need cash in like, the next five years of your life”—I mean, he's in a full panic.

  • If you watch the video it's quite shocking. It's shocking CNBC actually let him on.

  • But he's sitting there going, “If you need cash in the next five years, you've just to sell everything and go to cash,

  • because we don't know where the bottom of this is.”

  • And two days later—I remember, I'd been at Goldman Sachs, and my dad asked me my opinion.

  • A couple days later he sold all of his AT&T.

  • He would have sold his stock in the Catholic Church before he sold his stock in AT&T.

  • And he sold his stock.

  • And thatthat struck me as that this is a crisis of the institutions of our country, right?

  • This is a—this is a massivewe now have an institutional crisis.

  • When guys like Marty Bannon, who the country's—kind of this Steady Eddie guy who the whole thing is to raise a family,

  • to be there for the family, to be there for his community,

  • he's the kind ofthese are the kind of building blocks that society, civic society's built upon.

  • When guys like that are questioning the system and dumping their ownership in the system, the system can't go on like that.

  • You're now in a real crisis.

  • It felt to me when we were watchingwe made a number of films about it, and one of the

  • one of the things that happened in the cascade, because we make political films, we were thinking about

  • let's talk about Sarah Palin, for example, somebody who could identify in some way what that was,

  • what that fear and that anger was, probably in your dad and lots of dads and moms all over the country. …

  • That's one of the reasons I came back.

  • You know, I was actually living in Shanghai at the time.

  • I was living in the French Concession, spending most of my time there.

  • I had a—I had a massive multiplayer video game company that had a big Asian presence in Hong Kong,

  • Kowloon, South Korea and in China…. So I was living there.

  • Came back because I thought there were some financial problems.

  • I was going to sell real estate.

  • But then my sister pointed me to this woman, Sarah Palin, who'd just been namedwas going to be the vice president.

  • I actually went to the Republican convention as

  • just with a filmmaking guy, the guy who produced The Passion of the Christ, Steve McEveety,

  • and went to theand saw something unique in Palin and saw her go round.

  • People forget.

  • When the financial crisis, when Lehman was put into bankruptcy, which was put into bankruptcy, I think,

  • on the morning of Sept. 15 in London, right, and then it cascaded down,

  • the smartest guys in the room didn't realize that the commercial paper market, the global commercial paper market,

  • which is the way that every company in the world gets its working capital to kind of, you know,

  • make payroll and to pay for the lights going on and for the janitors and for everything that's pay

  • you know, GE, the biggest companies of the world, the commercial paper market,

  • every day you're selling commercial paper to provide working capital.

  • When that froze up on the morning of the 15th, the whole system froze up.

  • On that date, Sarah Palin and John McCain, I think, were up one point in the Gallup Poll on Barack Obama;

  • that people forget, Palin came with such force out of that thing

  • for the first two weeks before she started to be kind of destroyed, they were on fire.

  • It was, in that sequence of events that week, I think talks about the corruption of our institutions,

  • and I think it talks about how the elites are comfortable with decline.

  • Remember, on that Thursday morningMonday, it goes into bankruptcy.

  • By Thursday, there's a crisis that nobody knows what's going on in this commercial paper market.

  • The whole way that the whole entire global system is financed is now frozen up.

  • And that's when you have [Chair of the Federal Reserve Ben] Bernanke and [Treasury Secretary] Hank Paulson,

  • who are not alarmists, particularly not Bernanke, and he's an expert

  • remember, he's an expert in the Great Depression.

  • That's his claim to fame; that's what his Ph.D. is in.

  • They go to the Oval Office to go see Bush, and they have a meeting, and they tell him, hey

  • and we know all of this by congressional testimony later.

  • So these are the facts.

  • They go to him and say: “Hey, by 5:00 today, we need a trillion dollars of cash infusion into the system,

  • or the American financial system will collapse in 72 hours.

  • The world financial system will collapse 48 hours after that, and we will have global anarchy and chaos.”

  • And Bush goes: “That's interesting, but we've kind of

  • the White House counsel said we've kind of checked the Constitution.

  • I don't really have authority to do that.

  • You've got to go over to Capitol Hill. It's kind of their problem.”

  • And so they go up to Capitol Hill.

  • They go to Nancy Pelosi's office in the afternoon, and they had the same meeting.

  • In fact, they've got to keep theirthey've got to keep their Blackberries outside it's so confidential.

  • And they talk in there about they need this cash infusion.

  • That's when, you know, Hank Paulson gets on his knees to Nancy Pelosi and makes some sort of pitch to her.

  • The country's in literallywhat the Germans and the Japanese military and the Soviets,

  • what nobody could ever do to us, Osama bin Laden, nobody, we've now done to ourselves.

  • We have literally caused a financial crisis that will bring down the entire system in 72 hours.

  • The biggest revolutionaries that have gone after the United States could never dream of what we had done to ourselves.

  • And so that began a cascade ofand here's the thing.

  • Nobody, nobody's ever been held accountable for it. Nobody's ever taken responsibility for it.

  • And it just kind ofthat's why, you know, we have never recovered. We've never recovered from that catastrophe.

  • Somebody's been held accountable, which is probably why we have Donald Trump sitting in the White House now.

  • It's conceivable to meand you and I can talk about it

  • what happens politically among the group that become thedeplorablesto Hillary Clinton,

  • theforgottento Donald Trump— …

  • The bang that went off on Nov. 9 of 2016 at 2:30 in the morning was lit in the Oval Office on Sept. 18 of 2008.

  • It was lit right in that room.

  • Why?

  • It was lit, that fuse, that long fuse that has this populist explosion exploded.

  • But every financial crisis, I think, in at least modern history is always followed by some sort of populistright?

  • Now sometimes that devolves into fascism and other things.

  • But every time there's a financial collapseand remember, this is the biggest financial collapse in the country's history.

  • This is bigger thanthis is bigger than the Great Depression.

  • This is bigger than the one in the 1870s that caused such a big problem.

  • This is bigger than the one that caused the Federal Reserve [sic] in the early 20th century.

  • This is the biggest financial collapse in American history.

  • And this was one that was not done just by simple Ponzi schemes.

  • This was done by an organized, thought-through effort of the financial and corporate elites that

  • remember, the scams pulled off here are absolutely outrageous. …

  • And so that's why you had this immense collapse.

  • You had so many of the elites making so much money.

  • Then when it collapsed, they wanted the taxpayersthe whole thing of the trillion dollars.

  • The Federal Reserve didn't call all the financial institutions together and corporations and say:

  • Hey, boys, we've got a problem, right?

  • This is a problem, and we need to pass the hat.

  • You've got to cough up some cash.”

  • That trillion dollars was from Marty Bannon.

  • They hitprint,” right?

  • They hitprint,” hitprint,” but the guy's who's going to pay for it is the little guy.

  • We live in neofeudalism. This is not capitalism.

  • This is where you have an underclass, right, a Lumpenproletariat almost that's taken care of by the state;

  • you have the very wealthy; and you have this kind of neofeudalist working class and middle class in the middle

  • that pays for everything, and the guys at the top who we've socialized the risk, that trillion dollars of infusion, right?

  • Remember, the balance sheet of the Federal Reserve on the morning of Sept. 18, 2008,

  • when they're in the Oval Office talking, is $880 billion.

  • The balance sheet of the Federal Reserve on Jan. 17, or Jan. 20 of 2017,

  • when Donald Trump raises his hand, is $4.5 trillion.

  • The most progressive president in the history of our country, President Obama, saved the wealthy,

  • and here's how they did it.

  • [Treasury Secretary Timothy] Geithner, they just turned on the taps of liquidity.

  • We call itthe technical term isquantitative easing.”

  • The not-technical term is called bailing out the people who are guilty, OK?

  • Essentially, if you owned anything, you had the greatest 10-year run in history.

  • Wait, wait, wait. … Let's move to the TARP [Troubled Asset Relief Program] vote and whether you think

  • so now all of that is happening.

  • You have to do TARP, the first one you have to do. You know why?

  • Your fiduciarywhen a guy like Bernanke walks in and says,

  • “I need a trillion dollars,” right, you don't have time to debate.

  • History's going to look at you.

  • When he says, “The American financial system's going to collapse in 72 hours

  • and the world financial system two days after that, and you're going to have global anarchy,”

  • there's not a person on earth—I don't want to hear these libertarians and all these,

  • you know, free mar—“Oh, let capitalism take place.”

  • No.

  • When they come in and ask for the first trillion in an emergency, I believe you have to say: “OK, we've got to do it.

  • I don't know what went on here, but if you tell me this is going to save me and at least get down the road, I'll do it.”

  • But remember, that's the first trillion.

  • We kept on for another $3.5 trillion. $3.5 trillion.

  • This is just bailing out the people that caused the problems.

  • Got to think about it for a second.

  • You know, Goldman Sachs didn't lose any equity.

  • None of the partners really missed any bonus payments.

  • GE's still in business, AIG.

  • It all still exists, all the donors, OK?

  • The reverse side of this, remember, there is a corollary to this that's quite powerful.

  • And we know from the notes of the Federal Reserve, a guy named Richard Fisher, the governor

  • the president of the Federal Reserve of Dallas, argued this in the room constantly.

  • He said by doing this quantitative easing, which you're just flooding the zone with liquidity,

  • we will save the institutions, and we will save anybody that's a big real estate holder or hedge fund or bank.

  • But he said, there's a huge reverse here.

  • Number one, savings accounts are going to go to zero-interest rates.

  • Savings accounts are going to go to zero.

  • So 5,000 years of the Western traditionback to the Marty Bannons

  • which is be a good householder, get a wife, get a mortgage, get some kids, and you save your money.

  • Well, now, if you save money, you're a sucker, because it's broken the trust.

  • That's the trust that's broken.

  • If you save money, you're a jerk because you're not going to get any interest paid. In fact, the bank's going to charge you.

  • So there's been noyou can't—you can't put money away to save into the system.

  • Number two, the pension funds.

  • The pensions funds are going to be destroyed.

  • Today we have a $9.5 trillion gap between the obligations of the pension funds and what we've earned off the pension funds.

  • Why? Because it went to zero-interest rates, and the bonds they can buy have no juice in them. right?

  • The other thing is public schools and all this.

  • Even communities that are not leveraged can't issue bonds because there's no juice in the bonds,

  • because of negative interest rates, 1.5%.

  • We've essentially put the burden of the bailout on the working class and middle class.

  • That's why nobody owns anything.

  • But the millennials today are nothing but 19th-century Russian serfs.