Transcribed by Jay Farrington, Paula Sayles and Jim Magee
Klein: Naomi Here.
Kall: Oh, Great. And I just used the word "shock," too. Great to have you here, so much. I was just talking about how Hank Paulson pulled together the leaders of the top banks in the country on Monday and they simply sat them down, told them how bad things were, handed them a document, then said, "This is what you're going to agree to. Did you see that article in the Wall Street Journal?
Klein: I saw the article, but I think the way this is being spun is a little absurd.
Kall: Well, tell me about it.
Klein: Well, the spin is that Paulson was really tough with the banks and forced them to sign against their will; I mean the terms of the deal are incredibly favorable to the banks; they didn't have to negotiate, because they couldn't have negotiated a better deal for themselves. They get the money but the government is taking no power, there's no voting right, so they've just been handed free money in the midst of an economic crisis; a lot of these banks, if they are not bailed out, they're going down. So this spin that Henry Paulson is so tough with the banks is absurd; he's the best thing that's ever happened to them, and he's one of them.
Kall: Now Ben Bernake studied the Depression and during the Depression, they did something like this but the government did have control, isn't that right?
Klein: Exactly; and even if we just compare what Paulson did to what Paul Brown did, just on the straight level of what taxpayers are going to get paid back Gordon Brown and British taxpayers are getting 12% and American taxpayers are getting 5%.
Klein: They could have gotten a much better deal, so no wonder the banks agreed to it so quickly.
Kall: I'd love to hear more about what you've been observing and what's been going on the last couple of weeks. The bailout, the consolidation of all these banks-- fewer and fewer.
Klein: Well, it's been an interesting couple of weeks; I think that people need to take all this media reporting with a great deal of skepticism; one of the real lessons, I think of this period, and you know this is a period of shock. As you know, one of those moments where things start moving into "fast forward"; there's so much that happens in a week, you can't even keep track—
Kall: Let's just take one moment; I introduced you before you got on, 'cause I didn't want to waste any time, but you've written a book, The Shock Doctrine: Disaster Capitalism; can you give just a few minutes to get us a quick overview of what it is and how that fits into what we'll be talking about?
Klein: Yes, well, the thesis of the book is that if we want to understand how this radical "market fundamentalism" has swept the globe, the system that has imploded before our eyes, the de-regulated system that has been so profitable for the people at the top but something of a disaster for everyone else.
If we want to understand how this system has swept the globe from Latin America to Russia to this country, we need to understand the incredible "utility of crisis" to this project, because the great leaps forward for this project have taken place in the midst, during the immediate aftermath of some kind of a shock.