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Oct. 22, 2010 - InfoWars Special Reports
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Here's our interview with Catherine Austin Fitz, the former Assistant Secretary of Housing under George Herbert Walker Bush.
Say the information that she covers in this interview is vital, is putting it lightly.
My name is Catherine Austin Fitz.
I am originally from Philadelphia.
I went to university and business school and then to Wall Street in 1978 and eventually became a partner and member of the board of an investment bank called Dillon Reed & Company.
And left in 1989 to join the Bush administration as Assistant Secretary of Housing, Federal Housing Commissioner, and then left after 18 months to start my own company, Hamilton Securities, which was both an investment bank and software developer in Washington.
And the company was very successful and became unfortunately embroiled in very serious litigation with the federal government.
And it was through that process that I was forced to research and try and understand the corruption that was really taking over on Wall Street in Washington.
And I then settled the litigation and in the process many people come to me saying how do I protect my own assets from the corruption and so I started an investment advisory company and moved to a small farming community Hickory Valley Tennessee where I live now.
I really felt Washington was centralizing political and economic power.
And I thought, entrepreneurs have to take this wonderful new technology of the Internet and use it to decentralize.
You know, and America breaks down to 3,100 counties, and so my feeling was 3,100 counties have to decentralize and bring the economic power back to the economies.
And another way to think about it is, if you study how the human body works, In a crisis, we will preserve the blood for the heart and the lungs and the brains and draw it from the toes.
And if you look at our current economy, we're sending the blood to the toes and the fingers and pulling it from the heart, the lungs, and the brain.
The real economy.
And I really thought technology could help you reverse it.
And in fact, it appeared to be working.
It was very successful, which is, I think, why we ended up being the target.
You see that happen a lot to the companies that were using software to decentralize.
They would get targeted and the governments steal the software and all that kind of stuff.
You know, this tension of are we going to decentralize in a way that creates wealth or are we going to centralize in a way that destroys wealth is really the battle that's going on globally and as part of what's been happening in America.
One of the things to understand is that if you look at a household budget, or a family's financial cash flow.
So if you look at our 401Ks, if you look at our IRAs, our bank deposits, our other savings and investments,
the taxes we pay, the money we waste on lottery, we're all shipping our money into Washington and Wall
Street, and then it's trickling back.
It's almost like, you know, if you think of an irrigation system, we're sending our water down the river, it's hitting a dam, and it's not really coming back.
But we have the power to shift the flows.
And I was sitting, one of the ways I realized it, I was sitting with three women here in Tennessee.
And one of them, I, you know, I always get people to talk about their money.
So one of them said that she had her retirement savings in the local bank, and their correspondent bank is a large New York bank, over, you know, approximately 1,000 miles away.
And so she's earning about 3%.
Let's say the bank's paying 4% to get that money.
And then the second woman has an IRA, and she had stock in the same New York bank.
And this was before 2008, because in 2008 she would have lost most of her money.
But she figured she's getting about 5% for that equity investment.
So figured that bank's paying 4 to 5% to get the capital of these two women.
So they're sending their money to New York, And getting back about four to five percent.
The third woman had started a business with a credit card from that same New York bank, and after she had borrowed the money, they had jacked up the interest rate to 23 percent.
So these women are sending their capital and getting about four percent, and one of their best friends is borrowing it back at 23 percent.
Now, that is, you call that on Wall Street, a 2,000 basis point arbitrage.
That's a huge spread!
And when you look at the cash flows, there's no reason why those women, you know, alone or those women with a local bank or local financial institution can't circulate that money in a way that's going to make them all much more money.
So, no one needs a bank over a thousand miles away in between three friends with those cash flows.
But that's what's happening and it's happening all across the economy.
They can lend to each other or if they don't want to lend to each other, there's services now where literally you can go to a company that will just service the loan and write up the documents and service things among people who are family or friends.
So that's one way you can do it.
But you can also go to a local community bank and say, you know, we're not in the lending business and we don't want to become financially knowledgeable about all this.
Will you make a loan One of us has CDs.
We'll post our CDs as collateral.
This third person will write a contract to the first saying, I'll guarantee it because you don't want to take the risk.
And then the third person will borrow.
You do it all with a community bank.
The community bank takes a spread that is a lot less than 2,000 basis points and say, you know, the first, the borrower could pay 12%.
Okay, so these two, instead of making 4%, let's say they make 8%, the bank makes 4%, and everybody's happy except the big New York bank.
But then you keep the money locally.
And you can go through our economy and you'll see the same thing happen.
I just described a loan, but I can show you the same thing with equity investments.
I mean, how many people said that Enron was a better investment than Hickory Valley Meat Market?
I beg to differ.
I still have the Hickory Valley Meat Market.
You know, they don't have their money from Enron.
So, if you go through the household budgets and cash flows in every community and you start looking to see, how can I take the blood out of the toes and engineer it back into the heart and lungs in a way that makes me money?
Those opportunities are abundant, particularly if enough of us start to see them and do them.
I was lying on the table at a natural practitioner's office, and she was explaining to me how a tapeworm works in your body.
What a tapeworm does, it injects into you a chemical that makes you crave what's good for the tapeworm.
So, you know, you are the one who feeds yourself whatever it is the tapeworm wants.
And so you go through this process where you feed the tapeworm and the tapeworm grows stronger and stronger and stronger, and you grow weaker and weaker and weaker.
And that's a very beautiful description of sort of our relationship with, you know, what Eisenhower called the military-industrial complex and the financial sector, which has grown like a big fat tapeworm over the last Particularly the last 15 years.
But anyway, so I was listening to her and I said, you know, I need to use that phrase.
So I started to talk about the tape room economy.
Because if you look at the tape room economy, the media feeds us information about what's good for the tape room and bad for us.
So, you know, we watch TV or we listen to the TV news and we're encouraged to do things that make money for big corporations.
But in ways that reduce either our physical equity or our financial equity.
So they get richer and we get poorer.
And so we have this dynamic where we're the host and we're feeding the tapeworm.
And the more we feed the tapeworm, the more powerful it gets.
And the more we lose.
So if you go back to the three women in Tennessee, They're getting poorer and poorer because they're making less on their investments, or they're paying more for what they're borrowing.
And meantime, the tapeworm in the middle is getting richer and richer and richer.
So, a tapeworm economy is an economy where a few insiders can constantly drain subsidy from the outsiders in a way that preserves their wealth, but it shrinks total wealth because the host is getting weaker and weaker and weaker.
Since the beginning of the Republic, so from the Revolutionary War till about 18 months to two years ago, if you look at all the debt we'd issued to finance everything, so finance the Civil War, World War I, World War II, the Korean War, the Vietnam War, all the infrastructures, the building of the highways, all the bridges, the space program, all that, All the government programs, the GI Bill, so you look at all the debt we've issued to finance everything since the beginning of the Republic, that amount of money was $12 trillion.
And then in 18 months, we gave or lent from the Treasury and the Central Bank an equivalent amount, another $12 trillion to the banks.
Now what was that about?
That $12 trillion refinanced out So, think of it this way.
I want to take you over.
I issue everybody else $12 trillion of funny money.
and derivatives that the financial sector issued during the 1990s, the last 15 years,
literally to finance a leverage buyout of the country and the planet.
So think of it this way. I want to take you over. I issue everybody else $12 trillion of funny money.
I take you over and then I use your $12 trillion to pay them back.
Okay.
So literally, we're watching a leverage buyout of a country, and that's why I call it a financial coup d'etat.
And that's what the bailouts were.
One of the things that caused this tremendous ballooning of the power and economic resources of the financial sector was in the early 90s, we passed the Uruguay Round for GATT, for the General Agreement on Trade and Tariffs.
As a result, we changed the rules of how capital can flow around the world.
And so suddenly, it's sort of Ross Perot's giant sucking sound, you pull tremendous amounts of capital out of this country and you shift them abroad into other areas around the world.
And one of the things, in fact, that happened, we do a lot to pull liquidity on those other areas so that you can buy in cheap.
So you pump up the United States economy at the same time you flatten the economy in Asia or in Latin America so you can buy in, you know, so you take this money at a high price and buy in cheap at a low price.
Okay?
So they're shifting massive, massive amounts of capital and as they shift that capital, they totally change who's the owner.
Okay, so when it leaves this country, five trillion of that money is in the United States government, so it's shared, you know, it's in the commons, if you will.
By the time it gets to Asia, you know, the ownership is in the hands of small numbers of people.
So you see this enormous capital shift.
And one of the other things that happens as that capital shift occurs is we're watching the end of sovereign governments and the rise of corporations.
We're literally changing the governance structure on planet Earth so that we're no longer governed by countries that coordinate with each other.
We're literally governed by private corporations.
In this process, you know, and part of it is privatization, you're watching liabilities being shifted into sovereign governments and assets being shifted to corporations.
Okay?
So the corporations are getting the assets and the governments are getting the liabilities.
So let's go back to the bailout.
One of the ways to look at this is when we did that capital shift, we said in the beginning of the 90s, We can't afford the retirement of the boomers.
We've promised them in Social Security, Medicare, and Medicaid more than we can afford to pay.
So what we're going to do is we're going to pull all their retirement savings out.
We're going to basically shift out all the money that's in the pension funds, the equivalent, okay?
And what we're going to put back in their pension funds is phony baloney paper.
And we're going to shift out the money that's in the Social Security Fund and shift in phony baloney paper.
So that once we've gotten all the money out, they're going to be sitting with a bunch of phony baloney paper and promises to each other.
Okay, so it's really a way of leaving the American middle class high and dry and getting out while the getting is good.
In the 90s, there were a group of people in Washington who, clearly seeing what was going to happen with globalization, said, look, we're going to transfer all the jobs abroad, and we're going to transfer huge amounts of capital abroad.
And what that means is we need Americans to change.
We need to help the broad middle class and the citizenry adapt to these changes.
And that means we need to pay down our debt, and we need to flow equity capital back into small business, because small business is what is creating the jobs.
And we need to integrate new technology into small business and into communities.
So I had started the software developer Hamilton Securities Group.
What we were doing was we were making a software tool called Community Wizard that would let people see where all the government money was within their county or their community.
And part of that was to do these things you needed to re-engineer and make government investment much, much more productive.
There's tremendous waste still is.
And you really needed small business to be an engine with government of job creation in a way that would produce a lot of financial wealth.
Because that's what the boomers needed for retirement.
They needed the pension funds to really be sufficiently funded.
Okay, so there's a whole group of people interested in making this all possible.
And so while the money would flow out and manufacturing and jobs would flow to Asia, there would be something new lifting up.
Okay?
So all of this was known.
I don't know if you remember Newt Gingrich running around and saying every kid needed a laptop.
Well, that's what he was talking about.
He was talking about integrating new technology and helping revive new skills.
Okay, so we knew all this was going to happen and we knew that we needed a plan to deal with it.
Okay, so I was part of a group of people saying pay down your debt, flow equity, small business, create new skills, new jobs, because otherwise the American middle class is toast.
Well, you know, sort of the litigation that we dealt with was the response.
The federal government said, no, we want you guys to leave town and we're going to force you out with dirty tricks.
And instead, what we're going to do is we're going to have a bubble.
We're going to have a housing bubble and get everybody, instead of building new skills, to run around and just build bigger houses.
So we're going to build much bigger houses.
And while everybody's building bigger houses and watching TV, we're going to quietly move all the money out of the country.
And then when it's all said and done, you know, it'll be too late.
Because they'll have, instead of less debt, more debt.
They'll have fewer small businesses, because we're going to have our big franchises and corporations come in and take over the local market.
And, you know, so we'll have a party and no one will notice.
And then by the time they notice, it'll be too late.
And so what happened was the average American family was encouraged to take on mortgage debt, auto debt, credit card debt that in many respects they did not know that they couldn't afford.
Now, what was amazing was the government and the financial institutions knew they couldn't afford it.
In other words, they encouraged them to take on this debt knowing that the policies were being engineered that would cause their incomes to fall later on.
So, for example, let's just say you're a man with a family and two kids and you have a job as a software developer and you feel like you're doing very well.
You don't know that a whole series of things are going on behind the scenes that mean you're going to lose your job in three to five years.
I mean, it's statistically very probable, okay?
So you don't know that, but the financial institution that's making you the loan does know that, okay?
So they come to you and you say, well, you know what, the housing prices in Austin, Texas are rising, and I'm doing well, and my family's growing, and I need a bigger house.
It's a perfectly reasonable thing.
And that's a strategy that's always worked for Americans, with very rare exception.
So that's the responsible thing for you to do.
And I say, oh yeah, no, I'm encouraging you to do that.
In fact, you don't need to make a down payment.
So I encourage you to do the mortgage, and you take out the mortgage.
You buy the house.
Now, under the law, I'm not an attorney, but my understanding of the law is if I know something about your financial situation that you don't, and I don't disclose that, that's a material omission.
So if I don't say to you, Mr. Smith, you know, you keep your savings in this bank, and we're using your savings to loan money to JPMorgan Chase to move all these jobs abroad.
In fact, all the jobs for your food stamp government contract We're moving to India.
So you as a taxpayer are going to fund these jobs.
Your deposits, our financing, are moving these jobs.
And when we get these jobs all moved in another three to five years, you'll probably lose your job.
Okay?
We don't tell you any of that.
We just say, here's more debt.
Now, under the law, I believe that there's a case to be made that that's fraudulent inducement.
Fraudulent inducement is if I encourage you to take on debt and fail to disclose something that I know that you don't.
That's a material omission under the law.
It's illegal.
Okay.
Now, if that's the case, just speaking as the former Assistant Secretary of Housing, the vast majority of mortgages originated in the United States after 1996 were fraudulently induced.
Now, we can all say that even, let's say the Supreme Court decides tomorrow, they're all fraudulently induced.
The reality is our pension funds own them.
So we just sold our fraudulently induced mortgages into the pension funds, and if we can't pay off those mortgages, then guess what happens to our retirement savings?
In the summer of 2000, I was giving a speech to a group of people called Spiritual Frontiers Foundation International, and they have a conference once a year to discuss how they as a group can help our society evolve spiritually.
They're very well educated, very wonderful, very committed people.
So, I'm in the middle of the speech, and a friend of mine had asked me to give a speech on... it's called, How the Money Works on Organized Crime.
And it later became an article called, Narco Dollars for Dummies.
And so, I'm in the middle of the speech, and I'm describing the fact that the Department of Justice, a year before, had told a reporter that I work with, that the U.S.
economy wanders $500 billion to a trillion dollars of all dirty money.
So that's narcotics trafficking, that's tax evasion, that's financial fraud.
With financial fraud, it's much bigger now.
So I said to this wonderful audience of spiritually involved people, what would happen if we stopped?
And there was a little sort of conversation and they said, well, you know, Our mutual funds would go down because that 500 billion to a trillion wouldn't come into the stock market.
It would go to London or Zurich or Hong Kong.
And we'd have trouble financing the government deficit because we need to borrow all this money to finance.
So our taxes might go up or our government checks might stop.
And I said, OK, well, let's pretend there's a big red button up here on the lectern.
And if you push that button, you can stop all hard narcotics trafficking in your city, your county, Your state, your country, tomorrow thus offending the people who control 500 billion to a trillion dollars a year of money laundering through the U.S.
financial system and the accumulated reinvested capital they're on over the last umpteen years.
Who here will push the button?
And out of a hundred people dedicated to evolving our society spiritually, guess how many would push the button?
What?
So I said to the other 99, why would you not push the button?
And they said, we don't want our government checks to stop, we don't want our taxes to go up, and we don't want our mutual funds to go down.
So that's the conundrum.
Because if you look at the American financial system, we've created through force, you know, it's called the Central Banking Warfare Model, the Central Bank prints paper, and then the military makes sure that everybody takes it.
While they're extracting the natural resources for cheap, right?
Okay?
So the tapeworm economy is not just in America.
The tapeworm is extracting a subsidy all around the world.
And until 2008, most Americans were the beneficiary of that.
Now, you can say most Americans were naive.
If you look at every county in America, one of the biggest businesses in every county is narcotics trafficking.
Illegal drugs targeted at the children, that makes everyone money.
Okay?
And then the government has huge war on drugs, and that makes a lot of other people money.
So one of the biggest industries in America is the genocide of the children of our neighbors.
That puts us, as a people, across the line.
Because we've been complicit.
I spent a decade trying to warn my family, my friends.
You know, I ended up on Alex Jones and all sorts of radio shows explaining.
I was the former Assistant Secretary of Housing.
I was a former partner of the Wall Street firm.
And yet, the majority of people who heard me wouldn't believe me and wouldn't listen.
So we've all gone along, we've all been complicit, we've all, one way or another, been the beneficiary.
And, you know, it's hard to face what has to be faced.
I used to have a pastor in Washington who would say, if we can face it, God can fix it.
And what came out that day that I told the story about the Red, you know, the story of the group I was speaking to was, What they didn't understand is if they would just look at it, if they would just look at the red button problem and talk about it, that there was a way to turn the red button green.
In other words, the question we need to ask is, not should we push the red button, but how do we make money pushing it?
So, I call it turning it green.
Because there are, the tape room economy is draining us.
And so the issue is how do we reverse that drain?
How do we start to get energy for us instead of giving energy to the tapeworm?
And so part of it is delinking it from this global taxation system that's going on that we all think we've been the beneficiaries of.
Because the day of the insider sharing the subsidy with us is diminishing.
We've been gutting our whole economy for decades.
I mean, we've been moving manufacturing capacity abroad.
You know, significantly since the early, I mean, since the 80s.
So this has been going on for 25 years, and it's continuing.
And, you know, there's a myth that we're moving it abroad because it's more efficient, and that's not always true.
A lot of times we're moving it abroad because we can change who owns it and who controls it by moving it.
So, you know, it's churning and it's pumping and dumping in a way that doesn't make the economy wealthier.
But there's no doubt that the whole GATT process is one that is, to me, terrifying.
And I'll tell you where the greatest danger lies.
The greatest danger lies not in the wiping out of the American middle class or the re-engineering of jobs and how they work, or even The transference of power from sovereign governments to corporations.
The most dangerous part of GATT is the creation of a corporate right to create patents on life.
So to create Terminator seed and control the seed and food supply.
What GATT is doing, particularly if this new round, the Doha round, goes into implementation, is basically shifting two to three billion people off the land as small farmers and either killing them or into the cities in a process that will ultimately control the seed and food supply as that seed and food supply is being genetically manipulated.
And when you take 50% of a planetary population and move it from something where it's eating healthy food on a self-sufficient basis into a dependent role where it's dependent on corporations for food that is not healthy, then you're talking about a kind of planetary slavery which is more horrible than anything we've ever envisioned.
Now, one of my questions is to control, to build a global financial system around a dollar in which the dollar is hugely subsidized by this sort of global taxation system.
I mean, to give you an example, You're the Chinese, I'm the Americans.
I sell you dollars way above market level and you take them and hold them while they go down 5% every year.
That's a taxation system through the balance sheet.
So one of the ways I do this is not only by having a military but by controlling oil.
So controlling a very important physical asset is almost essential to having Currency control.
And one of my questions is, is control of the food supply part of implementing a global digital currency?
There's nothing more important to building either a healthy civilization or a healthy economy than transparency.
Okay.
So one of my favorite economics books is a book called The Evolution of Cooperation by a brilliant economist, Robert Axelrod.
And in it, he describes the conditions.
What are the conditions that would bring about an economy where people make money by building peace and cooperation instead of war and destruction?
And what he finds out is the most important condition precedent is transparency.
And transparency means that if I want to consider engaging in a transaction with you, I know if you're a good guy or a bad guy.
Do you wear a white hat or a black hat?
You know, if you can go to the other side of the planet and rape and kill and maim and then come back and be socially prestigious here and me not know, Then crime pays.
In that economy, if you can do dirty and secret and still be socially acceptable, then crime will always pay in that kind of economy.
So the condition precedent to a healthy economy is how can we make it expensive to be a criminal, okay?
Because if I know you're wearing a black hat, then it's like, ooh, I don't want to do business with you,
okay?
So what we have in this economy is one in which literally people are doing all sorts of nefarious things
and then they're held up as being admirable and respectful, okay?
Okay?
And they continue to be, in other words, they can engage in $500 billion to a trillion dollars a year of money laundering and the profits from that, but still be considered socially respectable.
Let me just use another example.
There's a wonderful lawsuit.
The European Union, on behalf of 11 sovereign nations of Europe, sued RJR Nabisco for money laundering with Saddam Hussein's family, the Russian mafia, Latin American drug cartels, on and on and on.
It's the most, you know, it's better than a Tom Clancy novel.
And it describes in the lawsuit how this money laundering was done at the highest levels of the corporation.
Well, who owned RJ Arnabisco at the time of the lawsuit, you know, that the lawsuit describes?
Well, it was KKR.
Okay, one of the most prestigious private equity and leverage buyout firms in the world.
Okay, so at the beginning of this year, we see, you know, Henry Kravis on the cover of, it was either Time or Newsweek, being held out as the next Warren Buffett.
Well, no, he's not.
He's the next mafioso.
Do you know what I mean?
But these people are honored because we don't have that kind of transparency in the economy.
So there's an official story, which has nothing to do with the real story, because we know the real story is being driven by the covert cash flows and the dirty tricks.
So we've got the official story, we've got the covert or, you know, sort of what I call the real deal.
And let's say a little piece of information about the real deal starts to sneak into the public mind.
So because You know, because of the Internet, because of all these different ways we have of communicating with each other, people start to realize, well, wait a minute, you know, what is all this stuff about MENA Arkansas and the Bushes and the Clinton families being partners on this drug operation and all this hard, you know, and Goldman Sachs and AIG doing these dirty deals with the housing authority?
What is all this stuff about MENA Arkansas?
As soon as that happens, what you'll get is you'll get what I call attack poodles.
They are the official enforcers Who are trying to kill anything outside of the official story that pops up.
So, a massive effort is made to come up with official explanations that incorporate all this, while anybody who's promoting anything outside of the official reality gets hit by the attack poodles.
So, for example, we see Gary Webb, who wrote the Dark Alliance story, one of the most incredible pieces of investigative journalism.
Um, I've ever, I've ever read.
And so, um, I'll never forget when, uh, when I picked up The Dark Alliance, but I'd heard about The Dark Alliance story, but never saw it.
It was published in the 1996, in August of 1996 by the San Jose Mercury News.
I never saw it when it up.
When the attack poodles got going, the San Jose Mercury News took it down.
But Gary Webb published a book.
Now, I've worked as an administrator in the federal government, and if you understand the machinery of federal government operations and enforcement and regulation, it's highly complex.
Now, a lot of times I'll read a book by somebody and there's all sorts of little mistakes about operations because they've never worked in government and they're not telling the truth.
And I'll never forget when I read Gary Webb's book, it was absolutely impeccable.
Everything rang true to me in terms of all the details of operations, regulations, etc., and the fundamental economics.
And that's when I know, you know, this guy has the story.
Well, if you look at what happened, when Gary Webb published on the San Jose Mercury News, he put up all the legal documents.
Thousands and thousands of pages of legal documents.
And I have friends who are in the minority, they have news businesses in the minority community, the African American community.
They downloaded all the documents.
And so suddenly, you couldn't kill the story.
Gary Webb's story was credible with the people because he gave them the hard evidence.
He gave them the documents.
He wrote a story that absolutely rung true, whether it was in the African American community or to me as a former government regulator.
So 360 degrees, it rang true.
So what did they do?
They turned the attack poodles loose on him.
And if you read the story of how Gary Webb was targeted and just literally run out of the news business, it's incredible.
So the attack poodles are very, very dangerous.
And I know because I've been the target of them.
I was during the litigation.
We dealt with a smear campaign that was invasive, unbelievable.
There was one group that is sort of the leader of the effort with 17 full-time people.
Just mailing packages of information to media and trying to get them to write stories.
And we constantly had one reporter who literally would write something that was factually not true.
Our attorneys would call.
We had to threaten a suit, but they didn't really care.
They had no interest in what the truth was.
We had an amazing thing where we spent a couple hundred hours with the Washington Post, gave them all the legal documents, everything.
They were going to write a story.
In 24 hours, the story disappeared, the reporter wouldn't answer my phone calls, went away.
And that left the field open for the attack poodles.
And so, so whether it's, you know, whether it's stopping a whole bunch of stories or the attack poodles attacking, anybody who tries to build a story outside the official story is attacked.
Now, the interesting thing is it doesn't work anymore.
Okay, and the reason it doesn't work anymore is where you have somebody outside the official story who's prepared to say, you know, I don't want to rise at CNN.
I don't want a job from the current administration.
I don't want any part of you.
You know, I'm just gonna sit over here and tell the truth.
Alex Jones is a perfect example.
You know, I'm gonna build my own thing and I'm gonna tell the truth and I don't care what you, you know, all you attack poodles can say and do whatever you want.
But I'm going to stand firm on the evidence.
The beauty of the Internet is we can put all the legal documents up.
We can put massive amounts of documents and evidence.
And for an audience that's willing to listen to some, you know, people who are going to take the time to read that stuff, It kills the attack poodle.
And that's why you're seeing more and more shift.
If you look at the media numbers, whether it's, you know, are they reading the Wall Street Journal or the New York Times?
Are they watching CNBC?
The numbers are swinging and moving towards the people who are telling the story.
You know, but there's no doubt about it.
Everybody in our world telling the true story has got to deal with attack poodles.
In the spring of 1997, the president of CalPERS, the largest pension fund in the country, was on one of my boards and we gave a presentation to them about my vision of how you could re-engineer the flow of money in communities to rebuild the American economy.
And do it in a way that would make a lot of money for pension funds.
So I had this whole thing on, you know, how we could reinvent America and make sure the boomers had enough for retirement and everything.
So the president of CalPERS is in the presentation.
He looks at me and says, you don't understand.
It's too late.
They've given up on the country.
They're moving all the money starting out of the country, moving, you know, in the fall.
So, that fall is the beginning of fiscal 1998.
October 1, 1997 is the beginning of fiscal 1998.
$4 trillion proceeds to go missing.
So, I start writing and publishing all of these stories about, you know, there's $2.3 trillion missing from the Pentagon this year, there's $1.1 trillion, there's $59 billion missing from HUD this year.
And, you know, story after story, using government documents, documenting, massive amounts of money are going missing.
Okay, so what happens next?
John Stossel does this huge story about how people at the Pentagon are using credit cards and not paying the money back.
Okay.
This ricochets everywhere.
It's like the big thing.
All my neighbors are saying, did you hear about this horrible, you know, Pentagon?
Now the money is less than 1% of 1% of the $4 trillion that's going missing.
So, so basically while the big boys are walking away with $4 trillion over here, everybody's over here saying, they're using credit cards to, you know, buy purses.
And this is terrible.
You know?
So we have the attack poodles coming at me because I'm telling the real story.
Meantime, we have the John Stossels of this world keeping everybody interested on irrelevant things.
When the litigation occurred with me, they tried to set me up on an obstruction of justice charge.
What happened was they seized our offices on a false pretext.
And while they were in the office, we had shredding bins that were empty.
They took trash that we had in a bag that we were saving, because we couldn't throw anything out because of the subpoenas.
So we had the trash all saved.
They opened up a trash bag, emptied the trash into the shredding bin, took corporate accounting records, put it in the bin, and then took pictures of it.
And the property manager in the property saw them doing all of that.
And he looked at them and he said, you can't do that.
That's, you know, that's falsification.
And they said, it was the Hunt Inspector General's counsel said, shut up, it's none of your business.
And after they left, we cleaned up the whole building and the property manager was so touched.
He called me and he said, I want you to bring your lawyer over.
I want to give you an affidavit because they're trying to falsify a charge against you.
Well, as this was happening, they wrote us a letter accusing us of throwing away documents, you know, that were, you know, under the subpoena.
And so they were clearly trying to set us up on an obstruction of justice charge.
Now, he gave us an affidavit and we turned it in the court and the court just said, That's S.O.P.
I didn't know what that meant.
So I called a guy who used to work in the HUD IG's office and I said, what's S.O.P.?
He said, oh, that's Standard Operating Procedure.
If they have no evidence of any wrongdoing, they'll just frame you on obstruction of justice.
Part, you know, this goes back again to the fact that, you know, you want to attack them and make them look ridiculous, or if you can't do that, you want to set them up and falsify evidence to get them.
But it's one of many different tactics you do to try and keep the population in the official story.
And part of doing that is giving them these sort of fake stories like the John Stossel, the modified Hangout.
If I put money in an investment as an investor and I get a return, I get a dividend or I get an interest, you know, that's my return to the investor.
But an investment also has a return to the ecosystem that the investment is in.
So let's say we get together and we build a convention center and we buy bonds to finance the convention center and we get a coupon on our bonds.
We get interest.
But that also has an impact on the city in which the Convention Center is built.
And that impact can be positive or negative.
And I call that the return to the network.
Okay?
So an investment has a return to the investor, but it also has a return to the network.
And the whole return is the total economic return.
So we have return to investor, return to network, 1 plus 2 equals return, total economic return.
Okay.
The way we've run our economy is we've used We've rigged return to the investors through the government to be positive at the expense of the whole.
So we have a positive return to Goldman Sachs, a negative return to the network, and the total is negative.
We're shrinking the pie.
Goldman and their investors are getting richer, but the pie is shrinking.
Okay?
Now, it's hopeless if you don't change.
In other words, if the tapeworm keeps draining the body, the body will die.
However, it's really simple.
To me, the host dying is not a good plan.
Why don't we simply eject the parasite?
Why don't we say, okay, Wall Street, we invite you to grow up and manage your business so it improves the total economic return.
The old saying, what's good for General Motors is good for America was, you know, you build up your manufacturing, you build up your technology, you make better and better products, you sell them successfully around the world, that creates jobs, that creates a, you know, and so what was good for investors was good for the total economy.
Now, the minute we say, as a financial system, we're all going to make money on things that have a positive total return, the whole thing spins and turns around.
And the funny thing is, particularly if you unsuppress technology which is available or known or sitting in the labs, There's enough wealth to create wealth that's mind boggling.
But that wealth creation requires aligning the interests of the financial system with the interests of people.
I mean, the message from the financial system is, we're going to make money by controlling life, okay?
So we're going to give you ID cards, and we're going to have a war on terror, and we're going to patent seeds, and farmers are not allowed to make their own seed or save their own seed.
They have to have Terminator seed.
And so the financial system is saying, we're going to create a few big corporations and they're going to control everything and you know, you're going to do what we tell you.
And so it's a force, it's an economy of force.
The minute you say no, you know something?
We're going to try democracy, we're going to try capitalism, because organized crime is not capitalism.
But markets, we're going to try democracy and free markets and all this stuff.
And we're going to let this technology out of the lab and into the real world.
So we don't need electricity bills of $300 to $500 a month.
Basically, what would it be?
I don't know, $10, $20 a month.
So we're going to integrate all this stuff.
And we're going to create alignments so that people can trust each other again.
We're making up with force.
What we don't need force to do what what trust can do if people can trust each other But that requires that the insiders have to respect the same laws that they require of everybody else That's a big big change.
So so the reality is if if we're going to keep running things where there's a positive return to investors and a negative return to the whole Then there are no solutions.
The minute we say, OK, you know something?
We're going to run our capital and we're going to make our decisions based on what has the highest total economic return.
Then suddenly you're talking about wealth creation that literally most people in my generation can't even fathom.
When I was at Hamilton Securities and we We had built databases that would allow us, through this community wizard tool, to see how all the money flowed by county.
And we said, OK, what if we were free to re-engineer government money so that it would produce the highest total economic return, irregardless of what corporation then got the defense contractor and what not-for-profit got the phony baloney rigged HUD deal?
You know, let's say we could just allocate all the money according to what would create The most economic health and the most jobs.
Let's just pretend that I had a really brilliant PhD guy from MIT who I gave this assignment.
I said, I want you to go engineer, if we could finance communities with equity, how much equity could be created?
And he came back and the number was so big, I thought he made a mistake.
I said, that can't possibly be.
You know, he had the float on the New York Stock Exchange increase like six, a multiple of six times.
You know, in five years, I said, that can't possibly be true.
Go back.
He kept doing the numbers over and over again, and finally I realized, you know, it is true.
Because the shrinkage is so great.
I mean, if everybody's walking around scared and feeling like a slave, you don't have a happiest society, but you don't have a productive economy.
And literally, if you could re-engineer government investment in this country tomorrow, and finance communities with equity, and let businesses compete not on, you know, who has Goldman Sachs behind them as opposed to, you know, who's productive.
The wealth that could be created is phenomenal, and there is a way out.
Now, that's a very deep cultural change.
I mean, the guys at Goldman Sachs, you know, and I'm picking on them, they haven't competed based on merit their entire life.
They don't know what that is, and they don't know that they don't know.
Okay?
And that's, you know, that's a real big problem.
What the population believes is that crime pays.
Because, in fact, it has.
Historically, crime has paid.
And we're coming into an endgame, and the question in that endgame is, a lot of the people who've been following the criminals, because they thought it paid, are now discovering maybe it's not going to pay.
But, to date, it always has.
The health care bill is an effort to satisfy You have a whole group of people who are out of alignment politically.
So you have pharmaceutical companies and insurance companies that want to make more money.
Even though their businesses have what I call a negative total economic return.
In other words, the health of Americans continues to deteriorate.
And the more money they make, the more our health deteriorates.
And so we really have a non-alignment between the people, the customer, And the corporations were supposed to be serving the customer.
And the way the corporations have resolved that is to go to Washington and get Washington to pass rules that force the customer to pay the corporations whether they need them or not or whether they can afford them or not.
Okay?
And it's really a way of liquidating the wealth of the people to prop up these corporations.
So, for example, you know, people in New Zealand or Mexico will describe the fact that they can buy lots of drugs, pharmaceutical drugs, for 10 cents on the dollar of what we pay here.
Okay, so clearly government is using their governmental authority to force profits into the You know the pharmaceutical cartel within the paper.
So you have a whole bunch of corporations who as Americans income fall are looking to use government to engineer Uh, more profits into them, okay?
At the same time, you have a large number of people in the, in the population who don't have health care are, are very concerned about that.
We know that, that one of, you know, the number one or one of the greatest reasons for bankruptcy and real trouble with credit card debt in this country is people with health care problems.
So, so you have, and, and then of course you have an aging population.
So we have a population that is very concerned about their ability to get health care or access to it, that are hoping to get some kind of Healthcare.
So you watch the people come into this process, and you watch the corporations come into this process, and of course there's a huge non-alignment.
Now, in the backdrop there's a third agenda, which to me is the most important agenda in the mix on healthcare reform.
And that agenda is the desire to have much greater control.
Okay?
Now, you can say it's the government, but in fact, if you look at who really controls and operates and runs the government, it's not the government.
It's very powerful private interests behind the government.
Some people call it the shadow government, but there are groups behind that.
And if you look at the provisions that have been discussed for controlling doctors, dictating to doctors what their policies will be, Requiring disclosure to the government of all sorts of confidential private information about people and their health.
You're looking at one of the most effective tools to implement fascism that I've ever seen.
Now, let's go back.
If you and I were to walk into Washington and say, oh, we have these 21 agencies.
We have the Department of Housing and Urban Development.
We have the Department of HHS, Health and Human Services.
We have the military.
You know, we have all these different agencies.
You would see lots of different agencies.
That's not what I see.
What I see is three defense contractors who control and operate the databases and the IT systems for all 21.
So I don't see 21 agencies.
I see Lockheed Martin.
Okay?
I see DynCorp.
I see... and they have the data.
They have this data, and this data, and this data, and this data, and this data.
Okay, now, let me step back in time.
Edwin Black wrote a magnificent book on the Holocaust, about IBM helping the Nazis build the database operation they needed to implement the Holocaust.
Okay?
Now, who's just been chosen as one of the lead contractors on our census?
IBM.
Okay?
And Lockheed Martin, I believe.
So, if you look at all the databases they have from around the country already, and you combine those databases with the data that could come from the health care bill on everybody's personal health information and their accurate address, what have you got?
You've got the basis, you know, you have the equivalent in 2010 of what the Nazis had to do the Holocaust.
You and, you know, God forbid you should combine that with a national ID card, okay?
But you're basically giving, you're turning over to a small handful Of private powerful interests, you know, a complete database on this country that combine what they have through the banking and other systems is unbelievably phenomenal and you layer on top of that artificial intelligence.
Now, at the heart of any health situation, You have a patient and a doctor.
And the thing that most protects that patient is the oath that that doctor takes.
That doctor's ethical commitment is to do whatever is in your interest.
So, if I'm in an emergency room and I'm trying to save your life, I don't think, well, you know, giving you this shot of adrenaline is more expensive than you can afford.
My obligation is to save your life.
When you fundamentally re-engineer the government rules and regulations so that they supersede that oath, then you're talking about creating a world in which your power as a citizen is radically diminished.
Because I'm cutting off from you the information and resources you need to make wise decisions about your health.
Now, we're talking about health care.
That change is happening across the board.
The IRS is requiring tax preparers to enroll with the IRS and become not your tax preparer with ethical obligations to you, but their enforcement arm.
You know, so it's your doctor, it's your tax preparer, it's your accountant.
All across the board, the professionals that you use in every aspect of your life are suddenly having their regulatory structure re-engineered so that person's ethical obligation is to the government and not you.
And what that means is you can then be literally at the most intimate levels of your life and your finances.
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