Arianna Discusses Public's Bailout Anger On BBC's Newsnight

Arianna recently appeared on BBC's Newsnight to discuss the economic crisis, the lack of reform, and the effects of the bailout on American society and politics.

Other Newsnight guests included economist Liaquat Ahmed, author Andrew Ross Sorkin, and historian Simon Schama. BBC's Kristy Wark hosted.

To explain the public's anger at bailed out banks, Arianna pointed to the lack of lending from institutions that were rescued with taxpayer money. "The bailout originally was defended by Henry Paulson on the grounds that it would allow the banks to lend, to jumpstart the real economy and the huge problem now is this disconnect between Wall Street and the real economy and there is nothing being done right now to change that, and that and that's where the anger is being unleashed... It's really about the bailout and the unfairness and the loss of faith. It's not really capitalism."

Click here to watch the clip.

Comments

[surferjay]

Wall Street and the bankers have caused more damage to this country and the world than all the terrorists acts combined, just so they can gamble our money! We should have put them all in jail for life and keep all companies under $1 billion in size.

[sonofsamphm1c]

Sorry, but AH is so off it's ridiculous. We all live in the economy. Like it or not, it is our lives. When it gets in trouble, we are what matters, and like it or not, the only way to fix it is to fix the banking system. In the modern world, which has gotten very very small because of computers and communication links, everybody is interconnected. This was not the case in the 1970s, and much of 1980s. But it is our new reality.

Too big to fail is nonsense. It is not their size. It is the interconnectedness. Slicing the big institutions into a million pieces would do nothing; the level of interconnectedness would remain exactly the same. If a systemic crisis threatens the system, the only rational choice, the smartest thing to do, the cheapest thing to do, is to bail out the system.

The actual cost of this bailout is going to be quite reasonable. The cost of what the outraged want, would have been the complete devastation of our economic system. The people who wanted that then, the Neocons in congress and the progressives who hate Wall Street, were morons then and are morons now.

[GrizzlyBowman]

So you believe that organizational leadership has nothing to do with the success or failure of an enterprise?

If we have 99 out of 100 businesses run by executives who steal from the coffers and spend most of their time golfing when they should be working and they fail, how does the 1 business generate sufficient tax dollars to hold up the rest of the doomed businesses without nearly a nearly 100% tax rate?

Where does the money come from? If it's printed money used to bail out, it's a credit card account opened with China.

I don't see what telecommunications development has to do with bailouts. Both me and Charles Manson have access to a telephone, but that doesn't mean our success, failure, or ideologies are in any way related.

[sabredance]

So if interconnectedness is the problem, do you support re-institution of Glass-Steagall?

[sonofsamphm1c]

GS, as written, was making us less competitive with foreign banks. That was the impetus for getting of of it. I would not support merely writing GS back on the books. I do fully support Obama's reforms. This failure was caused by subprime mortgages, and that happened because of a severely weakened regulatory system because of incompetence on the part of GreenRANDspam and Bush appointees.

The reality of interconnectedness cannot be changed, and to think a 1930s regulation could deal with it is naive.

While counterintuitive to victims of the credit crisis, I personally think systemic risk would be best regulated and detected with far fewer banks of far greater size. Put all your eggs in a fewer baskets and watch them very carefully, instead of thousands and thousands of baskets that effectively are not being watched by anybody.

[surferjay]

Wall Street and the bankers have caused more damage to this country and the world than all the terrorists acts combined, just so they can gamble our money! We should have put them all in jail for life and keep all companies under $1 billion in size.

[surferjay]

Why should any company be allowed to be big enough to bring down America and or the world?! Why are companies allowed to become more powerful than entire nations? Who is running our government or other companies governments?

[goodpyr]

What bothers me is there no effort to get some failsafes in place,whether the Banks like it or not.
Monitor every da## thing.Head in with subpeonas,catalog everything so you have a comprehensive place to start.Make the rules tough,and no more of this too big to fail crud.
I know, that's a little over the top,but the financial industry really makes my blood boil.

[AmericanMarineVeteran]

We let a few hundred people separate us from the ultimate goal. That is, the American dream. We have to come to a general agreement. No matter your color, gender, religion, sexual orientation we all want to live in peace, be able to raise a family, have a certain amount of freedom from government intervention in our lives and be able to make a decent living. When do we all agree on certain things without the outside lobby of Keith Olbermann and Rush Limbaugh. When can we stand up and make demands that 30 million voices are stronger than 900 politicians. I'm not sure about you, but I don't think most of the politicians are more intelligent than you or I. So when do we start. Who will be the one to stand up and voice our concerns with power. How do we stop the fleecing of large corporations or Robber Barons as they were called in the past. If we all join together on some of these issues, start write in campaigns or some serious political reform(Politicians make too much money, in and out of politics)then maybe we can make some changes. Of course these changes have to begin in the middle and not the fringe of left and right wing zealots who rejoice in just making loud noises to be heard but do not have finding solutions to everyday problems important. They make a living with the chaos. So

[IntellectuallyHonest]

I think protesting and demonstrations are extremely patriotic not to mention effective. They are what gave us civil rights in the 1960s. There are protests everywhere, but often they are not reported in the media. It's a great idea to protest injustice and stand up to the people that are ruining our lives.

[sabredance]

Not reported. That's the problem. The protest at the ABA in Chicago. Not reported. Not in Google News. Not anywhere on CNN (web). We really need to make a lot more noise, get creative, and be much bigger if we're going to grab attention, because its an uphill battle against the corporatists that control the media.

[Ohsherrie]

Does anybody really think that our government can't see something that's so obvious to everybody in the world who isn't either in our government or on Wall Street? It looks to me like they're counting on our just going along with whatever they do just like we have been for over 25 years now.

[IntellectuallyHonest]

Except the level of the wrongdoing has increased so dramatically that people are beginning to rise up and fight back with protests, debtors' revolts, etc. There is a large class of people that basically has nothing to lose. They will probably get some concessions for the things they need and deserve.

[anticapitalist1983]

put these posters up where you live, work, etc.... to show your disgust with this situation!

"wall street is at war with america"
http://www.scribd.com/doc/21140663/wallst

"corporate lobbyists are at war with america"
http://www.scribd.com/doc/21261649/Corporate-Lobbyists-Are-At-War-With-America

PEOPLE OVER PROFIT!
STOP GREED!
-we need publicly financed election campaigns. get money out of politics, it corrupts democracy. it turns one man= one vote into one dollar = one unit of influence.

[Michael V Marsh]

I concure. I couldn't swear to it , but I have the feeling that nearly every senior politician in the free world has bee placed in their respective possition by big business. The only way to effect change would therefore be to control election funding.

[PigLipstick]

Term limits have been suggested over the years without receiving any attention. it's difficult to reform the asylum when access is under full control of the inmates !

[sabocat]

I agree with the tone and tenor of this article, save one small item. This IS capitalism. People have an idea in their minds about how capitalism is supposed to work in the ideal world, a self-regulating system with competition, free markets, meritocracy, etc. The fact of the matter is that we've been living under a phase of monopoly corporate capitalism for some time now. This particular system is really not meant to work for the vast majority of people. It is rigged to benefit only a tiny minority, with a corrupt plutocracy in place to bolster the crony effect. We really are beyond the stage where a few reforms here and there can balance things out. Michael Moore is right: It's time to come up with a more democratic system which also democratizes the economy. but the only way that is going to happen is to empower a grassroots movement to take to the streets. If you want to see a good model for how to do that, look at Honduras.

[Nicholas Roy]

That is part of Marx's critique of capitalism and the failure of liberal democracy. While citizens enjoy democratic rights with the government they don't have those rights at work and thusly don't live in a true democracy, half their day (and by extension half their lives) they a being dictated to with no say in what they do. It makes me wonder if socialism could succeed where capitalism and liberal democracy failed.

[IntellectuallyHonest]

Socialism seems kind of tempting to me, too. Russia has socialism during Soviet days. Imagine how well off the people would have been if the Soviets hadn't spent 45% of their GDP on the military. Perhaps the real aim of the travel ban to Cuba is to hide just how well people live in the sunshine with free health care!

[Mij13]

The end of the American Century is very sad, but hopfully we can create something that is just as good and can be as good for working class families as Wall Street.

[cinoti]

Arianna, is fast becoming a true national treasure, and has hit the nail exactly.
It is like the crew of the titanic, stealing all the life boats, and letting every one else
drown. The emergency is just as great for the real economy as it was for wall street.
Wall street has been saved and they simply don't care any more about the rest.
Its business as usual, I am getting ten calls a day from JP Morgan, every day,
8:01AM to 8:59PM, they want their money NOW! and I have nothing to tell them.
Cause I am going down! But that's OK I am just some old white guy, that lost
his investments when Wall street tanked. Just one guy, when a son, trying to
scrounge up money to go to graduate school, and a wife that works 60 hours a week
teaching and plus. But we are still going down, House of 23 years and all.
I am the middle of middle class, and because I am old and can not get a job
for me it is the "Grapes of Wrath" How many of me are out there out there
I wonder! For me the system has broken and the guys that bitch about getting
ten or twenty million less a year, should perhaps ask themselves, "How much do
I really need to live a good life?"

[Tim303]

Newsnight is a kick axe show.

[Dukedraven]

If I had money, I would start putting it under the mattress--into a Sealy Posturepedic Account--and start buying gold. Good googly moogly.

[bradkoerner]

I meant to say, " healthcare with no public option".

[mjeffn]

Our economic system is about as capitalistic as our government is democratic. Neither is very either.

[iridium53]

Excellent Reading: HBR - Restoring American Competitiveness
by Gary P. Pisano and Willy C. Shih

They assert that:

Decades of outsourcing manufacturing has left U.S. industry without the means to invent the next generation of high-tech products that are key to rebuilding its economy.

• Thanks to destructive outsourcing and faltering investment in research, the U.S. has lost or is on the verge of losing its ability to develop and manufacture a slew of high-tech products.

• To address this crisis, government and business must work together to rebuild the country’s industrial commons —the collective R&D, engineering, and manufacturing capabilities that sustain innovation. Both must step up their funding of research and encourage collaborative R&D initiatives to tackle society’s big problems. And companies must overhaul the management practices and governance structures that have caused them to make destructive outsourcing decisions.

• Only by rejuvenating its high-tech sector can the U.S. hope to return to the path of sustained growth needed to pay down its huge deficits and raise its citizens’ standard of living.

[iridium53]

Twelve minutes well spent.