- Matt Taibbi
award-winning journalist with Rolling Stone magazine. He’s been closely following the Trump campaign. One of his recent pieces is headlined “A Republican Workers’ Party?” Taibbi is the author of several best-selling books, most recently, The Divide: American Injustice in the Age of the Wealth Gap.
In financial news, British banking giant Barclays Bank has agreed to pay $100 million in a settlement with 44 U.S. states for rigging Libor, the interest rate which underpins trillions in global transactions. British and U.S. authorities have taken action against a number of banks over alleged rate manipulation since 2012. This was the first settlement between a bank and U.S. states. For more, we speak with Rolling Stone journalist Matt Taibbi, who has closely covered the Libor scandal.
AMY GOODMAN: Finally, Matt, can you talk about Barclays’ $100 million settlement with U.S. states over Libor manipulation—
MATT TAIBBI: Yeah, it’s funny—
AMY GOODMAN: —and what that means?
MATT TAIBBI: Yeah, the Libor scandal was—you know, it should have been one of the biggest financial scandals of all time. They caught a number of the world’s biggest banks manipulating world interest rates through this London Interbank Offered Rate, which had impacted, according to some studies, more than $300 trillion worth of financial products. This was sort of a cartel-style corruption scheme. A number of banks got caught. Barclays has already paid a $453 million settlement in England. For them to come away with just a $100 million fine in the United States is really just a drop in the bucket for them. And it’s a signal to other banks that, you know, you really, if you—it’s the price of doing business. They’re not going to really worry about doing this again. It’s not going to be a deterrent.
AMY GOODMAN: And what does this say about the Obama administration?
MATT TAIBBI: Well, it’s, again, another in a long line of financial scandals that they have not aggressively prosecuted. Nobody went to jail for this. Nobody is going to have to pull money out of his or her own pocket to pay for this. This is all going to be paid for by shareholders. And it’s not a significant amount of money that’s going to even dent this year’s bottom line for that bank.
AMY GOODMAN: And why this matters in everyday people’s lives? Why Libor manipulation has—makes a difference?
MATT TAIBBI: World interest rates affect basically everything. I mean, if you have a credit card, if you have a mortgage, if your town has investments that are affected by world interest rates, all of these things are impacted by where Libor is on a given day. So your municipalities and states lost enormous sums of money because of the—where their investments were vis-à-vis Libor during this time period. That’s why they were—this settlement is really—was brought by a number of states that were negatively impacted by these changes in the world interest rates. So the damage that was done to these municipalities, to individuals, it’s incalculable. For them to walk away with just a $100 million fine says, A, we couldn’t really do an accurate damage calculation, and, B, it’s just a slap on the wrist, really, for these companies. It’s like the—you know, the HSBC deal, where they walked away with a relatively small fine for laundering hundreds of millions of dollars for foreign drug cartels. For them, it just says, “Well, even if we get caught, we’re going to pay a fine. It’s not going to really even dent a couple of months’ profit. So why not?” You know, it’s—I think it’s shameful.
AMY GOODMAN: This is what infuriates so many and why so many have come out against the establishment, whether it’s Donald Trump or it was Bernie Sanders.
MATT TAIBBI: Right.
AMY GOODMAN: So, how do you see this playing out, as you’ve watched Trump surge and now being roundly condemned? I mean, today, the latest, 50 national security experts, officials coming out against him—they are Republican. And then, what Hillary Clinton represents?
MATT TAIBBI: Well, I think—I remember talking just after the crash—I guess it was eight years now, almost eight years ago now—a lot of people on Wall Street and in Washington felt that if there were not adequate measures to clean up the financial services sector after what happened, that there was going to be some kind of a social movement, whether it was on the left or the right. People were going to be so upset that, somewhere, this is going to impact—you know, it’s going to create some kind of unrest somewhere. As it happened, I think, you know, that movement really coalesced on the right, on the Republican side, and they overthrew the Republican Party, essentially, with this ridiculous candidate, Donald Trump. But I think you can’t leave these problems unaddressed. You can’t just continually kick the can down the road and not punish these offenders, because sooner or later people are going to get upset. Even if they don’t totally understand these issues, they do understand that people are getting away with it. And it makes people angry, and anger eventually surfaces somewhere.
AMY GOODMAN: We’re going to break and then move on with our show. Matt Taibbi, award-winning journalist with Rolling Stone, we’ll link to your piece at Rolling Stone, the headline, “A Republican Workers’ Party?” Matt is the author of several best-selling books, his most recent, The Divide: American Injustice in the Age of the Wealth Gap. And thank you to Jacqui Maxwell in Detroit.
This is Democracy Now! When we come back, we’re going to Chicago and then back to Pakistan, where a suicide bomb has killed more than 70 people, many attorneys who were mourning the assassination of another attorney. Stay with us.