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(cinematic music)
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(soft music)
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- It's a free market economy
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but it's also a
national security issue.
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- Okay well I tend to think--
- You're going to be an independant
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country, you need to be
independant of food.
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- I tend to think of
climate change
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as a national security issue.
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- I do too.
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- They're not gonna
be able to do it
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in time the way
they're doing it.
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And every time, well.
- Recognize and adapt
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and change policies--
- Okay, let's...
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Let's look at ourselves
right now, okay?
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Let's say this road we're on
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is the American
political system.
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And you see past
that bridge up there,
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we have to get past that
bridge in the next minute,
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except this is
what we're stuck on
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because we can't get there.
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And you know this
as well as I do.
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(rain pouring)
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I know people in
their 20s and 30s
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that will not have kids,
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because they're like,
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"I'm not gonna subject a
human being to what's coming."
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Do you think my children
who are 15 years younger
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than that are somehow gonna go,
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"God I always wanted
my kids to grow up
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in Mad Max eating
lizards off the road
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and murdering their neighbors
to get a glass of water."
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I mean, things are
gonna break down.
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- [Wesley] Wesley
the passion that you
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and so many others
have on us this
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is what gives me
hope in democracy
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and hope in the
future of the country.
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That's what it's gonna
take to make change happen.
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(soft music)
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- [Wesley Jr.] I think we're
living in a rigged system.
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And I think it's very hard
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to break out of that rigged
system because money talks.
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(soft music)
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- I drove down from
San Francisco yesterday
on Highway Five
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and it's bumper to bumper
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for 300 miles on
(laughs) Highway Five.
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And you can think, God, that's
just a small part of it.
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So we know in these
big urban areas
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like the Los Angeles Basin,
metropolitan New York,
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we know that, we live
here for convenience.
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We live here because
civilization works,
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but we also know it
is relatively fragile.
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It depends on power,
it depends on water.
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It depends on food, it
depends on warehousing.
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It depends on security and
people following the rules
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and obeying the laws.
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And it only takes small
disruptions to that.
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Whether through natural
disaster, through climate change
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00:02:42,129 --> 00:02:45,433
through organized
crime or through war,
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through exogenous forces.
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And you'd see catastrophe.
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- [Narrator] It's easy to
see how things can fall apart,
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Long tunnels are now pitch dark.
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(cars passing)
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Communications and telephone
systems have collapsed.
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00:03:06,454 --> 00:03:08,188
On motorways cars
simply pull over,
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if they find a
place with a signal.
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(man speaking foreign language)
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People now stand in line
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outside supermarkets,
not to go in,
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they're just hoping that
it will eventually open.
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(people chattering)
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(wind blows vehemently)
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(speaking in a foreign language)
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- Combination of the weight
of scientific evidence.
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And the dynamics of the
financial system suggest
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00:03:42,723 --> 00:03:44,658
that in the fullness of time,
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00:03:44,658 --> 00:03:48,396
climate change will threaten
financial resilience
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and longer term prosperity.
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- All the money in the
world will not save us
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once it starts to fail.
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And then people will discover
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that you can't eat
a flat screen TV
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and you can't eat a
German luxury car.
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(pressing salt shaker)
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(tries to open door)
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- What are we gonna do?
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(engine revving silently)
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- It's war.
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00:04:13,086 --> 00:04:16,356
And it's a much more serious
war than World War II
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because if we lose,
we're all dead.
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I mean, you'll already be dead.
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So maybe it doesn't
concern you as much
95
00:04:22,762 --> 00:04:25,499
but I don't want my
children to starve to death
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- You're writing me
off really early.
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Please don't write me off
so early.
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- All right, 20 more years
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(children screaming)
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- Looks good doesn't it?
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- It does.
102
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- It's a great part of America.
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It's like an American icon.
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My generation was
the Beach Boys.
105
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- Yeah.
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- Surfing USA.
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- Yeah.
(water splashes)
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- So, you know, tourist heaven.
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- Yeah.
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- But if I were a tourist
from another planet
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and I was like, "Hey,
let's go visit earth."
112
00:05:01,935 --> 00:05:03,604
And then my travel guy was like,
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00:05:03,604 --> 00:05:06,874
"well it's populated
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00:05:06,874 --> 00:05:11,879
by about 10 billion carnivorous
apes and they're armed."
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- My goal is to see...
- Let's give you 20 more year
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Is to see your children
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grown, educated, married
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and I wanna have
great-grandchildren,
that's my goal.
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- Okay, if you wanna
have great grandchildren,
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what you have to do is
you have to help build
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that environment that
they're gonna survive in.
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- I want you to see the
facts as they appear to me.
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I'm a national security guy.
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That's what I've spent
my life working on
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trying to protect
America, the constitution,
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the way we live and our futures
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for our children
and grandchildren.
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00:05:49,282 --> 00:05:52,420
- I love my dad we're both
concerned about security.
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We're both concerned
about the future
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00:05:54,522 --> 00:05:56,256
but there's definitely
a difference
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in the generational
perspective of this.
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Now I understand his generation
because they grew up,
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00:06:02,863 --> 00:06:05,198
right after World War
II, the baby boomers.
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They grew up in a world that
was constantly improving.
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(car hooting)
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More rights, more money.
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The economy constantly expanded.
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They saw us go from fairly
primitive industrial society
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to what we have today.
140
00:06:29,890 --> 00:06:32,726
- There've been empires
that formed and collapsed.
141
00:06:33,894 --> 00:06:39,500
And about 200 years ago,
mankind suddenly discovered
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00:06:39,900 --> 00:06:43,170
how to take energy more
effectively from the earth.
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00:06:43,971 --> 00:06:46,740
In the start of
the industrial age.
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And it was coal
and it was England.
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And it was a steam engine
that could use that coal
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and it spread throughout
the whole world.
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We have taken that energy
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and built this
civilization from it
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00:07:03,323 --> 00:07:06,093
and the price that's being paid
150
00:07:06,093 --> 00:07:08,996
is the carbonization
of the atmosphere
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00:07:08,996 --> 00:07:10,397
and climate change.
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00:07:15,202 --> 00:07:18,271
(car engine roaring)
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- Yeah, that's the finale.
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(upbeat music)
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00:07:32,553 --> 00:07:34,622
- You know, when you
say in World War II,
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everybody chipped in
and did their part.
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And that was
seventy-five years ago.
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00:07:38,626 --> 00:07:44,297
Now we've been involved
in so far, a 19 year war.
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00:07:45,533 --> 00:07:47,134
And in that 19 year war,
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we were told to go shopping
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and to buy more stuff.
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00:07:51,238 --> 00:07:53,040
We were never told
to save anything.
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00:07:53,040 --> 00:07:55,408
We were never told to
contribute to a war effort.
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They even cut taxes
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when we went to war
- That's right, twice.
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- Twice.
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00:08:02,783 --> 00:08:05,318
(upbeat music)
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With gambling, the house always
wins and it's a rigged game.
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It just is.
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00:08:12,325 --> 00:08:13,994
Not unlike the banking system
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00:08:13,994 --> 00:08:16,263
in our political
system nowadays.
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00:08:16,263 --> 00:08:17,565
It's all rigged. People don't
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have an actual
choice in a lot of stuff.
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00:08:19,499 --> 00:08:21,635
Yeah, people have a
choice to go to Vegas.
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00:08:23,270 --> 00:08:25,005
- When you ran for president,
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I drove all over New
Mexico and other places.
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00:08:28,508 --> 00:08:31,078
All I could think
in 2003 was that,
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00:08:31,078 --> 00:08:34,815
we can't actually
build an economy
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00:08:34,815 --> 00:08:38,150
off stripping, gambling
and crystal meth.
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00:08:38,150 --> 00:08:40,520
And we've made a concerted
effort to do that
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00:08:40,520 --> 00:08:43,123
in this country for
the last 20 years.
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00:08:43,123 --> 00:08:45,859
- You know, our business
caters to what people want.
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00:08:48,596 --> 00:08:52,633
American societies produced
enormous amounts of leisure.
184
00:08:55,703 --> 00:08:59,039
- They've tried to recreate
the feel of the Roman Empire
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00:08:59,039 --> 00:09:00,708
in the heart of Vegas.
186
00:09:01,474 --> 00:09:04,878
And interestingly it's
like late Roman Empire.
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00:09:04,878 --> 00:09:07,280
So it's right, as
everything collapsed.
188
00:09:12,452 --> 00:09:14,855
- We have the smarts
and the know-how
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00:09:14,855 --> 00:09:16,624
and the conscience to know
190
00:09:16,624 --> 00:09:19,392
we have to sustain
and protect this earth
191
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because this is where we live.
192
00:09:21,561 --> 00:09:23,731
So we love civilization,
193
00:09:23,731 --> 00:09:26,033
but we've got to change
194
00:09:26,033 --> 00:09:29,703
the way we're approaching
our economic endeavors.
195
00:09:30,403 --> 00:09:32,005
- The world is suffering
196
00:09:32,005 --> 00:09:34,241
through the worst financial
crisis since 1930s.
197
00:09:34,241 --> 00:09:36,309
- There's been a
lot of damage done.
198
00:09:36,309 --> 00:09:39,479
- They hear $700
billion package,
199
00:09:39,479 --> 00:09:41,248
and they immediately
think the next day
200
00:09:41,248 --> 00:09:42,650
everything is gonna be better.
201
00:09:42,650 --> 00:09:46,086
- You're witnessing
so much wealth loss.
202
00:09:46,086 --> 00:09:47,855
- If you connect
the financial system
203
00:09:47,855 --> 00:09:50,758
to the other possible
shocks that are out there,
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00:09:50,758 --> 00:09:55,763
you realize it's,
we're walking on ice.
205
00:09:55,996 --> 00:09:57,698
- Panic coming
through the phones,
206
00:09:57,698 --> 00:10:00,000
on the floor, traders
just trying to rush
207
00:10:00,000 --> 00:10:01,935
to get to the point of sale,
208
00:10:01,935 --> 00:10:03,270
to get rid of their stock.
209
00:10:04,104 --> 00:10:05,706
- [Man] You know,
what people built up
210
00:10:05,706 --> 00:10:08,742
over years and years and
years, has been erased.
211
00:10:09,943 --> 00:10:11,378
(bell ringing)
(people applauding)
212
00:10:11,378 --> 00:10:16,516
- At some point, you run a
risk that something goes afoul.
213
00:10:17,217 --> 00:10:18,786
We're worried about Greek debt.
214
00:10:18,786 --> 00:10:20,420
We're worried
about Italian debt.
215
00:10:20,420 --> 00:10:21,922
- Spanish debt.
216
00:10:21,922 --> 00:10:24,925
- I mean and so far, you
know, it's been finessed,
217
00:10:24,925 --> 00:10:27,761
but, and you know,
218
00:10:27,761 --> 00:10:30,230
you can't see what the U.S
Treasury is doing behind.
219
00:10:30,230 --> 00:10:32,465
We're doing a lot with
the U.S Government
220
00:10:32,465 --> 00:10:34,634
to keep the system working.
221
00:10:34,634 --> 00:10:38,471
And you just don't know
what the limits are.
222
00:10:38,471 --> 00:10:39,973
- So if you think,
223
00:10:39,973 --> 00:10:43,276
how can we lead the world
in fixing the economy
224
00:10:43,276 --> 00:10:44,644
and fixing the climate?
225
00:10:44,644 --> 00:10:47,280
You have to make
the investments now.
226
00:10:47,280 --> 00:10:49,883
Because you can't wait
till you're like Somalia.
227
00:10:49,883 --> 00:10:51,451
I mean, you may notice
228
00:10:51,451 --> 00:10:53,821
Somalia doesn't have a lot
of infrastructure programs
229
00:10:53,821 --> 00:10:55,388
that they fund.
230
00:10:55,388 --> 00:10:58,325
They're not pushing the
boundaries in technology,
231
00:10:58,325 --> 00:11:00,794
and that's not because
people in Somalia are stupid,
232
00:11:00,794 --> 00:11:03,430
it's not just because they've
lived under civil war,
233
00:11:03,430 --> 00:11:06,466
it's because they
don't have capital.
234
00:11:06,466 --> 00:11:08,501
They don't have resources.
235
00:11:12,773 --> 00:11:16,509
- Capitalism is an
economic organization.
236
00:11:16,509 --> 00:11:18,979
It's a way of
organizing the economy
237
00:11:18,979 --> 00:11:23,984
that is focused on trying
to create future returns
238
00:11:23,984 --> 00:11:26,586
over and above of the
investments I make today.
239
00:11:27,020 --> 00:11:29,189
So it's all about expansion.
240
00:11:29,189 --> 00:11:30,690
It's all about making
more in the future
241
00:11:30,690 --> 00:11:32,159
than we currently have.
242
00:11:34,027 --> 00:11:35,695
- When you borrow money,
243
00:11:35,695 --> 00:11:37,364
well, what happens is,
244
00:11:37,364 --> 00:11:39,699
the banks would like
to charge you interest
245
00:11:39,699 --> 00:11:41,368
not only for the risk,
246
00:11:41,368 --> 00:11:44,938
but because they want
the capital to come
back with babies,
247
00:11:44,938 --> 00:11:47,975
not just to go and that's it.
248
00:11:47,975 --> 00:11:51,278
Because they want to make sure
that capital is increasing
249
00:11:51,278 --> 00:11:53,380
and that's how you build wealth
250
00:11:53,380 --> 00:11:55,615
and that's how you
increase your assets.
251
00:11:56,549 --> 00:12:00,788
- And it's that debt
that has enabled
252
00:12:00,788 --> 00:12:03,190
all of this to be here.
253
00:12:03,190 --> 00:12:05,859
It's the accelerant
to economic growth.
254
00:12:11,064 --> 00:12:12,332
- Now, as long as the company
255
00:12:12,332 --> 00:12:14,301
can service that
debt, it's okay.
256
00:12:14,301 --> 00:12:15,402
But consumer debt,
257
00:12:15,402 --> 00:12:16,636
if it can't be
serviced, is a problem.
258
00:12:16,636 --> 00:12:17,871
Mortgage debt if it
can't be serviced,
259
00:12:17,871 --> 00:12:19,372
as we've seen is a problem,
260
00:12:19,372 --> 00:12:20,707
and national debt, if
it can't be serviced,
261
00:12:20,707 --> 00:12:22,542
can be a national
security threat.
262
00:12:22,542 --> 00:12:26,313
- Alexa, how do we avert
a financial crisis?
263
00:12:27,915 --> 00:12:30,750
- [Alexa] Here's something
I found on Wikipedia.
264
00:12:30,750 --> 00:12:34,054
A financial crisis is any of
a broad variety of situations
265
00:12:34,054 --> 00:12:35,555
in which some financial assets
266
00:12:35,555 --> 00:12:37,991
suddenly lose a large part
of their nominal value.
267
00:12:40,193 --> 00:12:45,098
- Preparing for the future,
when the future is unknown,
268
00:12:45,098 --> 00:12:47,868
is obviously difficult,
269
00:12:48,701 --> 00:12:53,006
but we are today taking steps
270
00:12:53,006 --> 00:12:56,944
that are clearly going
to make things worse.
271
00:12:56,944 --> 00:12:58,778
- Finance is really
making big bets
272
00:12:58,778 --> 00:13:00,780
on an uncertain future.
273
00:13:00,780 --> 00:13:04,051
And you wanna be careful
about making too many bets,
274
00:13:04,051 --> 00:13:05,886
especially when there
is some indication
275
00:13:05,886 --> 00:13:08,421
that the future might be very
different from the present.
276
00:13:10,123 --> 00:13:12,893
(insects flying)
277
00:13:14,727 --> 00:13:17,297
(upbeat music)
278
00:13:18,365 --> 00:13:20,733
- [Wesley Jr.] So much
of our energy's caught up
279
00:13:20,733 --> 00:13:22,235
in the financial system
280
00:13:22,235 --> 00:13:26,039
that we've neglected the
investment in real things
281
00:13:26,039 --> 00:13:28,408
that are required to
take the country forward.
282
00:13:28,408 --> 00:13:32,112
- We do, we haven't really
come to grip with this yet,
283
00:13:32,112 --> 00:13:33,580
because the economic system,
284
00:13:33,580 --> 00:13:35,782
the political system just
doesn't wanna face it.
285
00:13:39,552 --> 00:13:42,155
(upbeat music)
286
00:13:50,931 --> 00:13:52,432
- The economy has grown,
287
00:13:52,432 --> 00:13:54,667
but debts, indebtedness
of households,
288
00:13:54,667 --> 00:13:56,336
firms, banks, governments,
289
00:13:56,336 --> 00:13:59,006
the debts of all these
actors in economic system
290
00:13:59,006 --> 00:14:01,608
have increased
much more than GDP.
291
00:14:01,608 --> 00:14:02,442
- Really?
292
00:14:02,442 --> 00:14:05,078
- Yeah. So let's say,
293
00:14:05,078 --> 00:14:07,680
I think maybe in
the 1970s or so the,
294
00:14:08,515 --> 00:14:12,419
total debt of all these actors,
households, firms, banks,
295
00:14:12,419 --> 00:14:17,257
government, the total debt
to GDP ratio was maybe of,
296
00:14:17,257 --> 00:14:19,859
of the order 120%.
297
00:14:19,859 --> 00:14:22,095
And now that has
increased very steadily
298
00:14:22,095 --> 00:14:25,498
over time to about 290%. So--
299
00:14:25,498 --> 00:14:29,369
- So if no one got
paid for three years
300
00:14:29,369 --> 00:14:30,337
and continued working
the whole time.
301
00:14:30,337 --> 00:14:31,771
- Exactly. Yup, yup.
302
00:14:31,771 --> 00:14:34,040
- And didn't eat or
drive cars or anything,
303
00:14:34,040 --> 00:14:35,175
we could pay that debt?
304
00:14:35,175 --> 00:14:36,176
- Yeah. Yeah.
305
00:14:36,176 --> 00:14:37,544
- But does the debt matter?
306
00:14:38,278 --> 00:14:40,380
- Well, I mean, the
debt matters to some,
307
00:14:40,380 --> 00:14:43,816
to the extent that
we have a system,
308
00:14:43,816 --> 00:14:45,618
it is called capitalism.
309
00:14:45,618 --> 00:14:47,387
And in that system,
310
00:14:47,387 --> 00:14:49,722
laws are telling us that
debts have to be repaid.
311
00:14:49,722 --> 00:14:52,192
(soft music)
312
00:14:52,892 --> 00:14:58,065
How much debt do we need
to generate $1 of GDP?
313
00:14:58,131 --> 00:15:02,702
For the economy to create
one extra dollar of income,
314
00:15:03,736 --> 00:15:09,176
we need, we are relying
on $3.30 of extra debt.
315
00:15:10,577 --> 00:15:12,545
(soft music)
316
00:15:12,545 --> 00:15:14,747
An income is basically
wages plus profits.
317
00:15:14,747 --> 00:15:18,085
That is what GDP is, you can
also call it differently.
318
00:15:18,085 --> 00:15:23,090
You can say it is value added,
created by producing stuff.
319
00:15:23,323 --> 00:15:27,194
- And as a result of
emphasizing on the GDP,
320
00:15:27,194 --> 00:15:31,598
we've ended up in a situation
where the market is going on.
321
00:15:31,598 --> 00:15:34,367
There is some selling,
there is some buying,
322
00:15:34,367 --> 00:15:38,038
but we really don't know
how well people are doing.
323
00:15:38,038 --> 00:15:40,773
(soft music)
324
00:15:40,773 --> 00:15:44,077
- [Wesley Jr.] You know, when
we were kids, $1 of debt,
325
00:15:44,077 --> 00:15:46,846
pretty much created $1 of GDP.
326
00:15:46,846 --> 00:15:48,281
- Oh wow.
327
00:15:48,281 --> 00:15:49,616
- So, you know, it's
like Keynesian economics,
328
00:15:49,616 --> 00:15:51,618
you put the money
into social projects
329
00:15:51,618 --> 00:15:53,853
and it recycles back
into the economy.
330
00:15:54,887 --> 00:15:58,458
But today it takes
more than $3 of debt
331
00:15:58,458 --> 00:16:00,227
to produce $1 of GDP.
332
00:16:01,561 --> 00:16:03,863
And that's all occurred
in the last like 30 years.
333
00:16:03,863 --> 00:16:05,065
- Wow.
334
00:16:05,065 --> 00:16:07,934
So in order to
create more money,
335
00:16:07,934 --> 00:16:11,138
you've gotta create more debt.
336
00:16:11,138 --> 00:16:12,639
- Three times as much debt.
337
00:16:12,639 --> 00:16:13,640
- That's insane.
338
00:16:13,640 --> 00:16:15,042
- More than three
times as much debt.
339
00:16:15,042 --> 00:16:17,144
- It's that access to
credit and the kind of ability
340
00:16:17,144 --> 00:16:20,547
to take on lots and lots of
debt that hasn't been able
341
00:16:20,547 --> 00:16:25,485
to sustain this kind of
trend in consumption.
342
00:16:25,485 --> 00:16:28,955
- So there is a very,
very strong relationship
343
00:16:28,955 --> 00:16:31,891
between increases in income
344
00:16:31,891 --> 00:16:34,327
and increases in
carbon emissions.
345
00:16:34,327 --> 00:16:36,963
(soft music)
346
00:16:36,963 --> 00:16:39,766
- In the U.S, which is
already kind of the most
347
00:16:39,766 --> 00:16:42,435
disproportionately
high energy producing,
348
00:16:42,435 --> 00:16:46,939
high consuming country per
capita spending grew 42%
349
00:16:46,939 --> 00:16:50,077
overall from 1990 to 2008.
350
00:16:50,077 --> 00:16:53,080
With a 300% increase in
spending on furniture,
351
00:16:53,080 --> 00:16:56,683
an 80% increase on clothing
and a 15 to 20% increase
352
00:16:56,683 --> 00:16:58,185
on vehicles, housing and food.
353
00:16:58,185 --> 00:17:00,120
Despite the fact that
wages were pretty stagnant
354
00:17:00,120 --> 00:17:01,354
over that time period.
355
00:17:01,354 --> 00:17:03,756
(soft music)
356
00:17:08,828 --> 00:17:10,963
- So this is the
Wall Street Bull,
357
00:17:10,963 --> 00:17:13,333
which is a symbol of
a positive market,
358
00:17:13,333 --> 00:17:16,136
which means more people
are spending money,
359
00:17:16,136 --> 00:17:17,936
than spent it the day before.
360
00:17:17,936 --> 00:17:20,373
- Our democracies basically
have become dependent
361
00:17:20,373 --> 00:17:24,277
on the idea that there will
always be more to go around
362
00:17:24,277 --> 00:17:26,146
that we can expand,
expand, expand.
363
00:17:27,780 --> 00:17:29,715
We know that there's
fundamental uncertainty.
364
00:17:29,715 --> 00:17:32,118
We just don't know what
the future will hold.
365
00:17:32,118 --> 00:17:34,554
(soft music)
366
00:17:41,394 --> 00:17:43,061
- Over the course of my career,
367
00:17:43,061 --> 00:17:45,198
I've worked in
mathematical modeling.
368
00:17:45,198 --> 00:17:48,067
I was a space physicist for NASA
369
00:17:48,067 --> 00:17:50,670
and I was on pretty
big projects.
370
00:17:50,670 --> 00:17:54,507
I was on the Hubble Space
Telescope team as a scientist.
371
00:17:54,507 --> 00:17:57,377
(soft music)
372
00:17:57,377 --> 00:18:01,414
I was on mission to Mars
as a space physicist.
373
00:18:01,414 --> 00:18:04,217
And so I'd worked on in
some pretty big areas.
374
00:18:05,752 --> 00:18:07,554
When people say, well,
375
00:18:07,554 --> 00:18:09,922
how do you know that the
climate models that we have now
376
00:18:09,922 --> 00:18:12,725
will be accurate
in 30 years time?
377
00:18:12,725 --> 00:18:15,562
What I can tell you is that
the models that we were working
378
00:18:15,562 --> 00:18:19,666
on 30 years ago are actually
unbelievably accurate.
379
00:18:19,666 --> 00:18:22,101
(soft music)
380
00:18:23,102 --> 00:18:24,737
What's happened
with the atmosphere,
381
00:18:24,737 --> 00:18:28,375
is we're seeing this type of
instability, kind of like,
382
00:18:28,375 --> 00:18:33,246
you know, if you had a
top just standing there,
383
00:18:33,246 --> 00:18:34,747
it'll just fall over.
384
00:18:34,747 --> 00:18:36,449
And so you're
seeing that type of,
385
00:18:36,449 --> 00:18:39,219
that type of wobbling
and instability.
386
00:18:39,219 --> 00:18:43,456
I don't exactly know how
unstable things are going to be,
387
00:18:43,456 --> 00:18:46,226
but to me, it's the
volatility and the instability
388
00:18:46,226 --> 00:18:48,295
that's even more
concerning than just
389
00:18:48,295 --> 00:18:52,632
the pure temperature
rise over time.
390
00:18:52,965 --> 00:18:56,869
Let's say that inflation
were to go over the top,
391
00:18:56,869 --> 00:18:58,638
stock market crashes.
392
00:18:58,638 --> 00:19:01,107
Let's say there are all kinds
of sanctions on exports.
393
00:19:01,107 --> 00:19:02,809
You can't even export your tech.
394
00:19:02,809 --> 00:19:04,143
You know, all you're left with,
395
00:19:04,143 --> 00:19:07,314
to survive is you
and your environment.
396
00:19:07,314 --> 00:19:10,417
(grasshopper buzzing)
397
00:19:10,417 --> 00:19:12,151
- You know, one of my goals
this year was actually
398
00:19:12,151 --> 00:19:15,154
to get more educated
on climate change.
399
00:19:16,155 --> 00:19:19,426
And I took the path
400
00:19:19,426 --> 00:19:22,829
that I was gonna see both
sides of the argument.
401
00:19:22,829 --> 00:19:25,164
And what was interesting
to me was I could find
402
00:19:25,164 --> 00:19:29,436
very little in the
climate denial space.
403
00:19:29,436 --> 00:19:32,772
The more I read, the
more I see around me,
404
00:19:32,772 --> 00:19:34,674
the more I get concerned.
405
00:19:36,509 --> 00:19:38,945
- [Katie] The officials
came out and said,
406
00:19:38,945 --> 00:19:41,180
we're gonna have to
release the dams.
407
00:19:41,180 --> 00:19:43,283
And I remember
looking at my husband
408
00:19:43,283 --> 00:19:48,187
and looking at my daughter
and the dog and the house
409
00:19:48,187 --> 00:19:52,359
and thinking, am I in
the middle of some movie?
410
00:19:54,160 --> 00:19:55,762
- So I'm 5.8.
411
00:19:55,762 --> 00:19:58,998
And the water reached
to about right there.
412
00:20:00,533 --> 00:20:03,035
Until it happens
to you, you don't,
413
00:20:03,035 --> 00:20:04,871
you don't believe
that this can happen
414
00:20:04,871 --> 00:20:06,706
in the United States of America.
415
00:20:07,774 --> 00:20:10,777
And all of your financial
stability is gone.
416
00:20:10,777 --> 00:20:13,045
So if we have, God forbid,
417
00:20:13,045 --> 00:20:15,047
any other emergency that
comes up and believe me,
418
00:20:15,047 --> 00:20:18,551
that is a source of a
traumatic kind of panic
419
00:20:18,551 --> 00:20:20,520
that sets in when we go, Oh,
420
00:20:20,520 --> 00:20:21,654
you know, what if
something happens,
421
00:20:21,654 --> 00:20:22,889
what if there's
another emergency that,
422
00:20:22,889 --> 00:20:25,224
that arises, then
we have no funds.
423
00:20:28,561 --> 00:20:31,331
- Never did I ever
imagine that everything
424
00:20:31,331 --> 00:20:35,868
that I would work so
hard for would be taken
425
00:20:35,868 --> 00:20:38,705
from me in a matter of hours.
426
00:20:39,672 --> 00:20:42,509
And so I do believe
that climate change
427
00:20:42,509 --> 00:20:45,011
is going to have a
huge economic impact.
428
00:20:47,347 --> 00:20:51,518
And what wealth you
have can be eradicated
429
00:20:51,518 --> 00:20:53,986
in a matter of hours.
430
00:20:53,986 --> 00:20:56,356
(soft music)
431
00:20:58,925 --> 00:21:02,595
(helicopter blades slapping)
432
00:21:02,595 --> 00:21:03,830
(helicopter engine revving)
433
00:21:03,830 --> 00:21:06,065
- We had a house
up here on the hill
434
00:21:06,065 --> 00:21:07,534
that my wife wanted
to get out of
435
00:21:07,534 --> 00:21:10,102
because it was dangerous
for the fires, you know.
436
00:21:10,102 --> 00:21:11,604
- Yeah.
437
00:21:11,604 --> 00:21:12,772
And the climate change,
everything's getting crispy,
438
00:21:12,772 --> 00:21:14,073
so we'd better get,
439
00:21:14,073 --> 00:21:16,676
to somewhere where we're
not gonna get burned up.
440
00:21:16,676 --> 00:21:17,877
- Yeah.
441
00:21:17,877 --> 00:21:20,212
- So we moved to
this beautiful place
442
00:21:20,212 --> 00:21:22,682
and the fire didn't get us.
443
00:21:22,682 --> 00:21:24,183
(laughs)
444
00:21:24,183 --> 00:21:26,686
But the debris flow after
the fire wiped us out, man.
445
00:21:26,686 --> 00:21:31,123
We had like mud four
feet here, huge rocks.
446
00:21:31,123 --> 00:21:32,258
- You were here, right?
447
00:21:32,258 --> 00:21:33,693
- Oh we were.
- How did you get out?
448
00:21:33,693 --> 00:21:35,395
- Rescued by helicopter man.
449
00:21:35,395 --> 00:21:36,896
- Jesus.
450
00:21:36,896 --> 00:21:39,732
- I said, you know, I said,
my wife, we, you got a sheet?
451
00:21:39,732 --> 00:21:41,200
And she said, yeah.
452
00:21:41,200 --> 00:21:43,302
I said, what are you
gonna do with the sheets?
453
00:21:43,302 --> 00:21:45,271
I said, I'm gonna write,
help out there, you know.
454
00:21:45,304 --> 00:21:47,807
She said maybe make it SOS,
I say that's a good idea.
455
00:21:47,807 --> 00:21:49,075
(laughs)
456
00:21:49,075 --> 00:21:52,144
Went out there and
drew SOS, in the mud.
457
00:21:52,144 --> 00:21:53,913
And pretty soon, (smacks)
458
00:21:53,913 --> 00:21:56,483
they come, they let a
guy down, and they said,
459
00:21:56,483 --> 00:22:00,086
we weren't sure if it was
a SOS or an area code,
460
00:22:00,086 --> 00:22:01,654
it looked like it
could have been 805.
461
00:22:01,654 --> 00:22:03,556
And I said, well I gotta
work on my esses man.
462
00:22:03,556 --> 00:22:04,991
(laughs)
463
00:22:04,991 --> 00:22:07,760
But we were lucky, you
know, we could afford to...
464
00:22:07,760 --> 00:22:09,996
- Well people died, people
died in this, right?
465
00:22:09,996 --> 00:22:14,501
- Oh! Terrible, people were
washed right through our place.
466
00:22:14,501 --> 00:22:18,170
And we were the lucky ones.
You know, we had the money,
467
00:22:18,170 --> 00:22:19,439
to refurbish this place.
468
00:22:19,439 --> 00:22:20,272
- I know, yeah.
469
00:22:20,272 --> 00:22:21,808
- But you know, imagine,
470
00:22:21,808 --> 00:22:23,843
people, you know, struggling
all over the world
471
00:22:23,843 --> 00:22:25,144
with this climate change.
472
00:22:25,144 --> 00:22:27,980
- That's the way It starts
it's, you read about it
473
00:22:27,980 --> 00:22:29,916
and It seems far away.
474
00:22:29,916 --> 00:22:32,919
But then something happens
and bang it's right on you
475
00:22:32,919 --> 00:22:34,286
and it gets very personal.
- That's right.
476
00:22:41,994 --> 00:22:45,865
- Hey, I hope you went
quick, that's all I can say.
477
00:22:46,633 --> 00:22:48,200
I hope you went quick.
478
00:22:49,536 --> 00:22:50,970
Oh my gosh.
479
00:22:57,376 --> 00:22:58,878
Words can't describe it.
480
00:23:02,048 --> 00:23:03,550
Words can't describe it.
481
00:23:05,718 --> 00:23:08,788
- Global systems of finance
are deeply connected
482
00:23:08,788 --> 00:23:10,723
and based on housing finance
483
00:23:10,723 --> 00:23:12,559
in places like
the United States.
484
00:23:12,559 --> 00:23:16,162
So if you get in a
situation where a homeowner,
485
00:23:16,162 --> 00:23:18,731
can't, can't pay an
insurance premium,
486
00:23:18,731 --> 00:23:21,968
can't hold on to their
mortgage, for that reason.
487
00:23:21,968 --> 00:23:23,903
Defaults on a mortgage,
goes into foreclosure.
488
00:23:23,903 --> 00:23:26,072
You have kind of, your
setting in motion,
489
00:23:26,072 --> 00:23:27,507
the sort of early
parts of the story
490
00:23:27,507 --> 00:23:30,910
that we know is a very familiar
one from 2007 and 2008.
491
00:23:30,910 --> 00:23:33,245
- And we're not
particularly good,
492
00:23:33,245 --> 00:23:37,316
at preparing for difficult
times way in the future,
493
00:23:37,316 --> 00:23:40,086
when in fact we've got
difficult choices right now.
494
00:23:40,086 --> 00:23:42,254
- When you survey
people in the U.S
495
00:23:42,254 --> 00:23:46,258
and in the UK about sources of
stress, it's work and money.
496
00:23:46,258 --> 00:23:49,095
(slow jazz music)
497
00:23:50,262 --> 00:23:54,266
- Alexa, how do I solve
our economic problems?
498
00:23:56,435 --> 00:23:58,404
- [Alexa] Sorry,
I don't know that.
499
00:23:59,606 --> 00:24:03,743
- We're heading off the cliff,
in terms of climate change.
500
00:24:03,743 --> 00:24:07,614
There's a real urgency on this
now that cannot be denied.
501
00:24:07,614 --> 00:24:11,350
- I grew up in the heart of the
military industrial complex.
502
00:24:11,350 --> 00:24:14,954
My father became a general,
after I went off to college.
503
00:24:14,954 --> 00:24:16,923
I went to the foreign
service school at Georgetown.
504
00:24:16,923 --> 00:24:20,860
Madeleine Albright was one
of my advisors in college
505
00:24:20,860 --> 00:24:22,762
and I thought, I know
how the world works.
506
00:24:22,762 --> 00:24:24,864
There are people in charge.
There's some with a plan.
507
00:24:24,864 --> 00:24:26,365
There's someone running stuff.
508
00:24:26,365 --> 00:24:28,968
When my father was head of
NATO and I got to go over there
509
00:24:28,968 --> 00:24:31,203
and visit and hear the kind
of questions that senators
510
00:24:31,203 --> 00:24:33,439
and congressmen
were coming up with.
511
00:24:33,439 --> 00:24:36,876
I realized, whoa, no
one's running anything.
512
00:24:37,877 --> 00:24:41,914
And the mistake that the
great majority of us make,
513
00:24:41,914 --> 00:24:46,152
is that, there are groups
of people running things.
514
00:24:46,152 --> 00:24:49,121
Someone has a master
plan, there's a cabal
515
00:24:49,121 --> 00:24:53,459
or a conspiracy behind
it all that's running it.
516
00:24:53,459 --> 00:24:54,627
And it's just not the case.
517
00:24:54,627 --> 00:24:57,163
(fire roaring)
518
00:25:04,336 --> 00:25:07,006
(water burbles)
519
00:25:09,341 --> 00:25:10,610
- Hey Wes.
520
00:25:10,610 --> 00:25:11,844
- How was the conference?
521
00:25:11,844 --> 00:25:12,679
- Good.
522
00:25:12,679 --> 00:25:13,846
- Good.
523
00:25:13,846 --> 00:25:16,182
- No, I think,
well I think they,
524
00:25:16,182 --> 00:25:18,618
I think they really wanted
to hear what's going on
525
00:25:18,618 --> 00:25:20,486
and what the challenges are.
526
00:25:20,486 --> 00:25:21,420
- Yeah.
527
00:25:21,420 --> 00:25:23,355
- And that's what I gave them.
528
00:25:23,355 --> 00:25:25,658
- Kind of reading this thing
about Venezuela you see.
529
00:25:25,658 --> 00:25:28,260
What happens when an
economy collapses.
530
00:25:28,260 --> 00:25:29,762
- Total collapse.
531
00:25:29,762 --> 00:25:33,265
- I mean, is it, was it just
initially the oil prices or...
532
00:25:33,265 --> 00:25:36,603
- They've tried to make
it a populist democracy.
533
00:25:36,603 --> 00:25:39,505
You know, where now
Maduro is, is a dictator,
534
00:25:39,505 --> 00:25:41,373
but you know, supposedly
people like him,
535
00:25:41,373 --> 00:25:44,376
but in an actual
fact Cuba's in there.
536
00:25:44,376 --> 00:25:49,381
And I was down about six
months ago in Colombia.
537
00:25:50,650 --> 00:25:53,352
And they were telling
me that actually,
538
00:25:53,352 --> 00:25:56,723
the Cubans are going up
to the Venezuelan army
539
00:25:56,723 --> 00:25:58,725
and they're disarming them,
540
00:25:58,725 --> 00:25:59,992
because they don't
trust the Venezuelan.
541
00:25:59,992 --> 00:26:01,728
This is the way you
take over a country.
542
00:26:01,728 --> 00:26:02,995
You're getting rid of,
543
00:26:02,995 --> 00:26:04,697
you know, you put your
security forces in,
544
00:26:04,697 --> 00:26:08,134
and then you build up
your extra military force.
545
00:26:08,134 --> 00:26:09,301
And then you go to the military
546
00:26:09,301 --> 00:26:11,337
that might be loyal
to the country
547
00:26:11,337 --> 00:26:13,973
and say, give us your weapons.
548
00:26:13,973 --> 00:26:17,376
So a lot of Venezuelan
militaries become refugees.
549
00:26:17,376 --> 00:26:18,310
- Oh wow.
550
00:26:18,577 --> 00:26:20,412
- They were disarmed and sent
out of the country, yeah.
551
00:26:20,412 --> 00:26:23,082
And there's millions of
people that are just there.
552
00:26:23,082 --> 00:26:24,416
They lived there,
they were born there
553
00:26:24,416 --> 00:26:26,218
and they're
struggling to survive.
554
00:26:27,419 --> 00:26:30,522
- It's a, I mean, we're heading
in that direction already,
555
00:26:30,522 --> 00:26:33,092
before we've even had
the economic breakdown.
556
00:26:33,826 --> 00:26:35,762
With armed groups
in the streets.
557
00:26:35,762 --> 00:26:38,931
You had 20,000 armed people
in the streets yesterday.
558
00:26:38,931 --> 00:26:40,900
- Well that was just
a demonstration.
559
00:26:41,868 --> 00:26:45,437
- Brought guns, you don't
bring guns to a demonstration,
560
00:26:46,706 --> 00:26:48,607
unless you're demonstrating
you'd like to kill people
561
00:26:48,607 --> 00:26:50,209
that don't agree with you.
562
00:26:50,209 --> 00:26:52,745
- Venezuela can be an
example of what happens
563
00:26:52,745 --> 00:26:54,080
when civil society breaks down
564
00:26:54,080 --> 00:26:55,782
because you don't have stable,
565
00:26:55,782 --> 00:26:57,616
transparent rule
of law government,
566
00:26:57,616 --> 00:27:00,019
and you don't invest in your
infrastructure the right way.
567
00:27:00,019 --> 00:27:01,754
In many ways, Venezuela
is a leading indicator
568
00:27:01,754 --> 00:27:04,223
of the challenges that
will face the whole world.
569
00:27:04,223 --> 00:27:08,227
- [Narrator] Many like Erin
Burgos feel they have no choice.
570
00:27:08,227 --> 00:27:12,431
(speaks in foreign language)
571
00:27:12,431 --> 00:27:15,968
What was once one of Latin
America's wealthiest countries,
572
00:27:15,968 --> 00:27:19,271
is now its most
chaotic and dangerous.
573
00:27:20,206 --> 00:27:20,973
(car honking)
574
00:27:21,240 --> 00:27:22,875
- But that's what happens
in these countries.
575
00:27:22,875 --> 00:27:25,211
- But by these countries,
you mean countries
576
00:27:25,211 --> 00:27:27,313
that have incompetent
leadership.
577
00:27:28,580 --> 00:27:32,785
- Countries that are failing
578
00:27:32,785 --> 00:27:34,386
to take care of their people.
579
00:27:34,386 --> 00:27:37,824
But they compensate for that by,
580
00:27:37,824 --> 00:27:40,159
setting up repressive
mechanisms,
581
00:27:40,159 --> 00:27:42,261
to ensure that they
stay in power. (laughs)
582
00:27:42,261 --> 00:27:45,064
- I just worry about it
happening in the United States.
583
00:27:45,064 --> 00:27:47,333
We have a country like
Venezuela where the first thing
584
00:27:47,333 --> 00:27:50,102
that collapsed is their
energy infrastructure.
585
00:27:50,102 --> 00:27:52,071
- Yeah.
- And then now we're finding out
586
00:27:52,071 --> 00:27:54,440
that it's not just electrical
587
00:27:54,440 --> 00:27:58,010
and oil pumping now their water
infrastructure is collapsing
588
00:27:58,010 --> 00:27:59,779
and this is a country
that's tropical,
589
00:27:59,779 --> 00:28:01,447
that's filled with water.
590
00:28:01,447 --> 00:28:03,515
- The energy sector has
not received the training
591
00:28:03,515 --> 00:28:05,251
or investment it needs, and
the experts were kicked out.
592
00:28:05,251 --> 00:28:06,753
They said the energy sector
593
00:28:06,753 --> 00:28:08,587
in particular the oil
sector is collapsing.
594
00:28:08,587 --> 00:28:11,523
And that was a major source
of revenue for the country.
595
00:28:11,523 --> 00:28:14,360
At the same time, you have
significant drought in a country
596
00:28:14,360 --> 00:28:15,527
that has a lot of water,
597
00:28:15,527 --> 00:28:16,763
which means the
dams cannot produce
598
00:28:16,763 --> 00:28:17,997
the same electricity
as they used to.
599
00:28:17,997 --> 00:28:19,698
So you have collapse of
the electrical sector,
600
00:28:19,698 --> 00:28:21,968
along with the oil sector,
along with civil society.
601
00:28:21,968 --> 00:28:23,202
And this means you also have
602
00:28:23,202 --> 00:28:24,370
collapsing water infrastructure,
603
00:28:24,370 --> 00:28:26,005
because even if
you have the pipes,
604
00:28:26,005 --> 00:28:28,540
if you don't have electricity,
you can't operate everything.
605
00:28:28,540 --> 00:28:30,943
So severe strain, which
means food shortages,
606
00:28:30,943 --> 00:28:34,146
riots, lack of money,
this is a major problem.
607
00:28:35,214 --> 00:28:37,049
United States and
Europe is rich,
608
00:28:37,049 --> 00:28:39,852
but if we choose to under
invest in our infrastructure
609
00:28:39,852 --> 00:28:42,688
and if we choose to not
prepare for the future,
610
00:28:42,688 --> 00:28:44,957
we could suffer these
kinda consequences as well.
611
00:28:44,957 --> 00:28:47,493
- The impact of climate change
612
00:28:47,493 --> 00:28:49,896
is not a straight line function.
613
00:28:49,896 --> 00:28:51,730
It's clearly
614
00:28:52,064 --> 00:28:56,235
a progression that
is accelerating
615
00:28:56,235 --> 00:28:59,405
in magnitude very dramatically.
616
00:28:59,405 --> 00:29:04,043
And so any lapse at
this point in responding
617
00:29:04,043 --> 00:29:08,214
is going to have, I
think, a critical impact
618
00:29:08,214 --> 00:29:10,917
down the road, much sooner
than we would anticipate.
619
00:29:10,917 --> 00:29:12,418
- This is a crisis
waiting to happen.
620
00:29:12,418 --> 00:29:14,753
It's a slow moving crisis
in front of our eyes.
621
00:29:16,555 --> 00:29:18,324
- So when you see in a movie,
622
00:29:18,324 --> 00:29:20,259
an asteroid's gonna
hit us in six months,
623
00:29:20,259 --> 00:29:22,594
but Mr. President
we've been working
624
00:29:22,594 --> 00:29:25,031
on this potential
problem for six years.
625
00:29:26,765 --> 00:29:30,169
In real life the asteroid
takes everybody out.
626
00:29:30,169 --> 00:29:31,904
The same goes for
climate change.
627
00:29:31,904 --> 00:29:34,540
The same goes for a whole
host of issues we have
628
00:29:34,540 --> 00:29:37,844
because when people
see something on TV
629
00:29:37,844 --> 00:29:41,547
and look, politics
is a confidence game.
630
00:29:41,547 --> 00:29:42,949
When people look at the
politician and they go,
631
00:29:42,949 --> 00:29:44,583
he must know what
he's talking about
632
00:29:44,583 --> 00:29:46,452
or she must know what
she's talking about.
633
00:29:46,452 --> 00:29:49,688
That doesn't mean there's
an actual plan with any kind
634
00:29:49,688 --> 00:29:54,026
of systemic machinery behind
it to produce results.
635
00:29:54,026 --> 00:29:55,727
(upbeat music)
636
00:29:55,727 --> 00:29:57,463
- As the water start to recede
637
00:29:57,463 --> 00:30:00,099
the financial costs will add up.
638
00:30:00,099 --> 00:30:02,401
- Are you tired of living
in a home like this
639
00:30:02,401 --> 00:30:05,071
when you really wanna be
living in a home like this?
640
00:30:06,305 --> 00:30:07,473
Let's check it out.
641
00:30:09,575 --> 00:30:12,278
We've got tons of
waterfront property,
642
00:30:12,278 --> 00:30:14,313
and more coming every day.
643
00:30:14,313 --> 00:30:17,249
Century 22 now serving
parts of California.
644
00:30:18,317 --> 00:30:21,320
* Best sparkling
drinks are just dandy *
645
00:30:21,320 --> 00:30:22,922
* The cho--
646
00:30:23,555 --> 00:30:25,324
- For those of you that
went to the mountain
647
00:30:25,324 --> 00:30:29,095
and enjoyed that 16 feet
of brand new, fresh powder,
648
00:30:29,095 --> 00:30:30,396
nice job.
649
00:30:30,396 --> 00:30:32,999
But as you can see, we've
got a hot front coming in,
650
00:30:32,999 --> 00:30:37,003
so tomorrow there's gonna
be 155 degrees Fahrenheit.
651
00:30:37,003 --> 00:30:39,906
So you might wanna
break out those Speedos.
652
00:30:39,906 --> 00:30:43,075
- You read the big
article about Peter Teal,
653
00:30:43,075 --> 00:30:46,345
who's the guy who's made
the big fortune off tech,
654
00:30:46,345 --> 00:30:49,848
has bought and built bunkers
in New Zealand, right?
655
00:30:50,749 --> 00:30:53,685
Because their plan is
we're all gonna die,
656
00:30:53,685 --> 00:30:56,355
and then they're gonna
ride it out somehow
657
00:30:56,355 --> 00:30:57,924
even though they won't.
658
00:30:57,924 --> 00:31:00,759
But there's the belief that
their money will insulate
659
00:31:00,759 --> 00:31:02,361
and shelter them
from what's coming
660
00:31:02,361 --> 00:31:03,996
and for all these people--
- For climate change
661
00:31:03,996 --> 00:31:07,533
- Who predicted doomsday.
662
00:31:08,600 --> 00:31:10,536
- Yeah I mean, I've
heard, you know,
663
00:31:10,536 --> 00:31:13,472
I've heard climate change
likened to a world war.
664
00:31:15,474 --> 00:31:19,378
You know, the difference
is that we know a lot more
665
00:31:19,378 --> 00:31:20,779
about what's coming.
666
00:31:20,779 --> 00:31:23,649
- Come on down to our
luxury survival condo
667
00:31:23,649 --> 00:31:26,018
and don't let the
Armageddon get you down.
668
00:31:28,820 --> 00:31:31,457
- So unless you can
produce thousands of years
669
00:31:31,457 --> 00:31:36,328
worth of water and air and food
in your underground bunker,
670
00:31:36,328 --> 00:31:37,696
you're not gonna make it.
671
00:31:37,696 --> 00:31:39,665
And the most likely
outcome will be that
672
00:31:39,665 --> 00:31:42,868
the construction workers
probably non-union
673
00:31:42,868 --> 00:31:44,870
that you paid to build
this bunker for you
674
00:31:44,870 --> 00:31:46,638
know exactly where it is.
675
00:31:46,638 --> 00:31:49,641
And they have access to all
the tools to dig you out of it
676
00:31:49,641 --> 00:31:50,977
like a truffle.
677
00:31:52,144 --> 00:31:56,582
The sooner people start
using their money as a tool,
678
00:31:56,582 --> 00:31:58,250
instead of a goal in life,
679
00:31:58,250 --> 00:32:00,352
the faster we're gonna
be able to dig ourselves
680
00:32:00,352 --> 00:32:01,153
out of this hole.
681
00:32:01,153 --> 00:32:02,921
- Okay, so dad, we've,
682
00:32:02,921 --> 00:32:04,256
I know you don't
wanna pay attention
683
00:32:04,256 --> 00:32:05,757
and you don't wanna be...
- I do.
684
00:32:05,757 --> 00:32:10,362
- Filmed with miniatures,
because it could, you know,
685
00:32:10,362 --> 00:32:12,531
you don't wanna look like
the guy in Dr. Strange Love
686
00:32:12,531 --> 00:32:13,732
or any other--
- Exactly.
687
00:32:13,732 --> 00:32:14,933
- Retired General
playing with things--
688
00:32:14,933 --> 00:32:16,202
- That's exactly
what it looks like.
689
00:32:16,202 --> 00:32:18,704
- But, look, we need
to set up something
690
00:32:18,704 --> 00:32:20,672
that people can
understand how it works.
691
00:32:20,672 --> 00:32:25,377
We have like a grocery
farmer, another store here
692
00:32:25,377 --> 00:32:29,115
a bank, a homeowner, and
then emergency services
693
00:32:29,115 --> 00:32:31,117
and over here's like nature,
694
00:32:31,117 --> 00:32:33,719
or we'll even say
foreign country
695
00:32:33,719 --> 00:32:35,087
or Africa, or somewhere else.
696
00:32:35,087 --> 00:32:39,058
So, but the first thing
I gotta do is change
697
00:32:39,058 --> 00:32:40,126
how everything's set up,
698
00:32:40,126 --> 00:32:42,894
because we need the bank
699
00:32:43,795 --> 00:32:45,131
in between
700
00:32:46,398 --> 00:32:49,635
the country club
and everybody else.
701
00:32:49,635 --> 00:32:53,972
- We have a huge financial
system compared to what the,
702
00:32:53,972 --> 00:32:55,474
what I can call the real economy
703
00:32:55,474 --> 00:32:59,445
that is where people work
and produce, and live.
704
00:32:59,445 --> 00:33:04,316
(upbeat music)
(people chattering)
705
00:33:23,335 --> 00:33:26,472
- What we were talking
about was trying to explain
706
00:33:26,472 --> 00:33:29,308
capital, structures
and insurance
707
00:33:29,308 --> 00:33:32,944
and financing and mortgages
using children's toys.
708
00:33:32,944 --> 00:33:34,780
So we have money--
- Is it gonna work?
709
00:33:34,780 --> 00:33:37,183
- I don't know if it's
gonna work. (laughs)
710
00:33:38,684 --> 00:33:43,255
- First thing is, the
grocery store is a business
711
00:33:43,255 --> 00:33:44,690
and it makes money,
712
00:33:44,690 --> 00:33:47,693
and they deposit the
money in the bank.
713
00:33:47,693 --> 00:33:49,095
- Okay. Boom.
714
00:33:49,095 --> 00:33:50,096
- Okay?
715
00:33:50,096 --> 00:33:52,331
John works at the grocery store
716
00:33:52,331 --> 00:33:56,468
and he gets paid by
the grocery store
717
00:33:56,468 --> 00:33:59,838
and he decides he
wants to buy a house.
718
00:33:59,838 --> 00:34:01,107
- Okay.
719
00:34:01,107 --> 00:34:03,275
- He doesn't have enough
money from his earnings
720
00:34:03,275 --> 00:34:06,112
to buy a house, but he goes
to the bank and the bank said,
721
00:34:06,112 --> 00:34:09,348
"Oh we'll give you the
money, to buy the house,
722
00:34:10,382 --> 00:34:14,985
and in return, you'll
give us an IOU."
723
00:34:14,985 --> 00:34:17,556
(upbeat music)
724
00:34:19,056 --> 00:34:20,458
- We have to look at the house
725
00:34:20,458 --> 00:34:22,860
is it, does it pass inspection?
726
00:34:22,860 --> 00:34:24,295
- Yeah, pass inspection.
727
00:34:24,295 --> 00:34:27,166
- And can you afford it
based on your monthly income?
728
00:34:27,166 --> 00:34:27,998
- Well,
729
00:34:28,967 --> 00:34:30,402
- The answer, say yes.
730
00:34:30,402 --> 00:34:31,503
- Yes.
- Okay, good.
731
00:34:31,503 --> 00:34:33,038
So here's a mortgage.
732
00:34:33,038 --> 00:34:35,907
Okay, so here's the money and--
- And by the way, this is just
733
00:34:35,907 --> 00:34:37,509
like a real bank,
because in the real bank,
734
00:34:37,509 --> 00:34:39,145
they're not sure can
this guy pay for it?
735
00:34:39,145 --> 00:34:40,911
Just tell him yes, tell
him yes, come on,
736
00:34:40,911 --> 00:34:42,681
lets get the money.
- So it depends on paying.
737
00:34:42,681 --> 00:34:45,417
- We typically think that
bank takes deposits from us
738
00:34:45,417 --> 00:34:46,918
and then lends it out.
739
00:34:46,918 --> 00:34:49,755
The balance sheet equates
one entry on this side,
740
00:34:49,755 --> 00:34:52,257
another entry on that side, has
sort of claims to come back,
741
00:34:52,257 --> 00:34:55,060
and if it's really
comes back as expected,
742
00:34:55,060 --> 00:34:56,527
they make a return on that.
743
00:34:56,527 --> 00:34:58,697
And it's basically making
money out of thin air.
744
00:34:59,331 --> 00:35:00,931
- In the old days,
745
00:35:00,931 --> 00:35:02,833
I would put this
mortgage, and I would say,
746
00:35:02,833 --> 00:35:04,034
"This is an asset for me,
747
00:35:04,034 --> 00:35:05,603
"because you're gonna
pay me every month
748
00:35:05,603 --> 00:35:07,239
"to pay this
mortgage off," right?
749
00:35:07,239 --> 00:35:08,873
- So you're telling all
your buddies you had that.
750
00:35:08,873 --> 00:35:10,442
- Well, I found a better
way to make money, okay?
751
00:35:10,442 --> 00:35:15,214
So the bank takes the IOU,
and the bank sells the IOU
752
00:35:16,114 --> 00:35:18,884
into the what's called
the secondary market.
753
00:35:19,185 --> 00:35:22,020
- Okay.
And it gets a fee for that.
754
00:35:22,020 --> 00:35:24,290
- Then once I have this
mortgage and maybe the mortgage
755
00:35:24,290 --> 00:35:26,292
for many other houses
in the neighborhood,
756
00:35:26,292 --> 00:35:28,627
and ideally from other
neighborhoods as well,
757
00:35:28,627 --> 00:35:31,697
I throw this into what we call
a special purpose vehicle,
758
00:35:31,697 --> 00:35:34,132
which really, in legal
terms, is typically a trust
759
00:35:34,132 --> 00:35:37,303
or a corporation, these
assets-shielding devices,
760
00:35:37,303 --> 00:35:39,205
and then you issue claims
761
00:35:39,205 --> 00:35:42,474
against these new legal
shells to investors.
762
00:35:42,474 --> 00:35:45,210
(retro jazz music)
763
00:35:45,210 --> 00:35:50,216
- They package these IOUs
up so there's many of them,
764
00:35:50,816 --> 00:35:54,653
and they sell them to people
like insurance companies
765
00:35:55,554 --> 00:36:00,592
or foreign banks, and
they can be leveraged.
766
00:36:00,592 --> 00:36:03,629
- Which means I can make
loans off these things,
767
00:36:03,629 --> 00:36:04,830
which are loans.
768
00:36:04,830 --> 00:36:06,898
- Yes, because you
have leverage here.
769
00:36:06,898 --> 00:36:08,967
So you can make more loans.
770
00:36:08,967 --> 00:36:11,737
So the system always
generates cash.
771
00:36:11,737 --> 00:36:14,573
(water splashing)
772
00:36:15,674 --> 00:36:17,276
They can reduce their risk
773
00:36:17,276 --> 00:36:19,611
because they're not
just buying a mortgage,
774
00:36:19,611 --> 00:36:21,179
they're buying a
package of mortgages.
775
00:36:21,179 --> 00:36:23,449
In some cases, they're
just buying a slice
776
00:36:23,449 --> 00:36:27,152
of the interest rate off
a package of mortgages.
777
00:36:27,152 --> 00:36:30,522
And so, all of these
are called derivatives.
778
00:36:30,522 --> 00:36:34,493
And everything works, as long
as there's an expectation
779
00:36:34,493 --> 00:36:36,362
that the loan will be repaid,
780
00:36:36,362 --> 00:36:40,799
that John will, at the
right time each month,
781
00:36:40,799 --> 00:36:45,371
give the bank money to pay
down his share of the IOU.
782
00:36:45,371 --> 00:36:48,206
(old timey piano music)
783
00:36:48,206 --> 00:36:50,276
So the old way the
banking system worked,
784
00:36:50,276 --> 00:36:53,044
it used to work that the banker
would look you in the eye
785
00:36:53,044 --> 00:36:54,646
and say, "Are you credit worthy?
786
00:36:54,646 --> 00:36:55,881
"Can I trust you?"
787
00:36:59,217 --> 00:37:01,387
- The banks really
aren't keeping
788
00:37:01,387 --> 00:37:03,054
the mortgages on
their books anymore.
789
00:37:03,054 --> 00:37:05,123
They're selling those mortgages
790
00:37:05,123 --> 00:37:06,358
so that they can be repackaged
791
00:37:06,358 --> 00:37:08,827
as other kinds of
financial instruments.
792
00:37:08,827 --> 00:37:11,530
So, they're able to
sort of pass the buck,
793
00:37:11,530 --> 00:37:13,565
pass the risk off
to the next person.
794
00:37:14,500 --> 00:37:18,036
- Depending on how they're
rated by the rating agencies,
795
00:37:18,036 --> 00:37:21,407
these are reputable
investment opportunities
796
00:37:21,407 --> 00:37:22,841
for retirement funds, sure.
797
00:37:22,841 --> 00:37:25,076
Yeah, pension funds,
sure, put 'em in here.
798
00:37:25,076 --> 00:37:26,912
- So the investors
are buying an interest
799
00:37:26,912 --> 00:37:29,247
in the cashflow that
comes from the homeowners
800
00:37:29,247 --> 00:37:31,550
into the pool that
we've created,
801
00:37:31,550 --> 00:37:33,652
but have sort of a claim
against this house as well
802
00:37:33,652 --> 00:37:35,421
because this cashflow is backed
803
00:37:35,421 --> 00:37:37,356
by the mortgage
against the home.
804
00:37:37,356 --> 00:37:40,191
So something as
illiquid, as formidable
805
00:37:40,191 --> 00:37:41,760
as this building and
the land it stands on
806
00:37:41,760 --> 00:37:44,930
can become a globally
tradable financial asset
807
00:37:44,930 --> 00:37:46,598
through appropriate
legal coding.
808
00:37:49,568 --> 00:37:50,869
- This is your loan.
809
00:37:50,869 --> 00:37:53,271
It travels through this system.
810
00:37:54,239 --> 00:37:55,173
The bank has the loan,
811
00:37:55,173 --> 00:37:56,107
(stamp smashing)
812
00:37:56,107 --> 00:37:58,176
sells it, it becomes a security.
813
00:37:58,176 --> 00:38:00,078
It becomes part of
the balance sheet
814
00:38:00,078 --> 00:38:01,547
of money market mutual funds.
815
00:38:01,547 --> 00:38:05,083
These money market mutual
funds then basically exchange
816
00:38:05,083 --> 00:38:07,786
your loan, your
collateral, your house
817
00:38:07,786 --> 00:38:11,056
in a collateralized cash
deal, and the whole purpose
818
00:38:11,056 --> 00:38:13,525
of both the cash and the
collateralized cash deal
819
00:38:13,525 --> 00:38:16,462
is that it allows
the various actors
820
00:38:16,462 --> 00:38:18,730
to operate in derivative markets
821
00:38:18,730 --> 00:38:21,567
and make very high rates
of short-term return.
822
00:38:22,801 --> 00:38:26,271
(wheels creaking)
(bell dining)
823
00:38:26,271 --> 00:38:28,139
- Today, debt is
treated like an asset.
824
00:38:28,139 --> 00:38:30,442
It can be traded
globally, right?
825
00:38:30,442 --> 00:38:34,045
So we made a huge jump from
let's say the 12th century
826
00:38:34,045 --> 00:38:37,148
when the first assignable
notes came about,
827
00:38:37,148 --> 00:38:39,585
to treating debt as an asset
828
00:38:39,585 --> 00:38:42,888
that we can just trade
on a global market.
829
00:38:47,225 --> 00:38:48,159
(slurping beverage)
830
00:38:48,159 --> 00:38:50,095
(jazzy piano music)
831
00:38:50,095 --> 00:38:53,131
- At the bottom,
there's tangible value.
832
00:38:53,131 --> 00:38:57,603
The same value is used, not
just one time, but two or three
833
00:38:57,603 --> 00:39:01,507
or four times in the
financial sector trading.
834
00:39:02,674 --> 00:39:06,478
It is not going for productive
investment in firms.
835
00:39:06,478 --> 00:39:09,615
It is also not going
to finance and fund
836
00:39:09,615 --> 00:39:12,684
climate change mitigation
and de-carbonization.
837
00:39:12,684 --> 00:39:15,020
Money creates more money.
838
00:39:15,020 --> 00:39:16,788
Wealth creates more wealth.
839
00:39:16,788 --> 00:39:18,990
And this is a circle,
and it just rolls on.
840
00:39:19,758 --> 00:39:22,127
At the end of the
day, it's our houses,
841
00:39:22,127 --> 00:39:25,330
the value of our houses,
which are backing this up.
842
00:39:25,330 --> 00:39:27,866
The IMF has called it "the
shadow banking system."
843
00:39:29,034 --> 00:39:31,369
"Shadow" here doesn't
mean that it is illegal.
844
00:39:31,369 --> 00:39:34,506
It also doesn't mean that it
is necessarily shady and so on.
845
00:39:34,506 --> 00:39:38,677
It is just that it is shadow
because there are no rules.
846
00:39:38,677 --> 00:39:40,479
It's hardly any rules.
847
00:39:40,479 --> 00:39:44,716
It's sort of almost the Wild
West of the financial sector
848
00:39:44,716 --> 00:39:48,186
(dramatic Western music)
849
00:39:49,721 --> 00:39:51,723
- And a problem with
the derivative market
850
00:39:51,723 --> 00:39:52,991
is there is no market.
851
00:39:52,991 --> 00:39:55,326
So it's like one-on-one
swaps between bankers.
852
00:39:55,326 --> 00:39:56,728
It's like you and I say,
853
00:39:56,728 --> 00:39:58,163
"Hey, I know what bank
you're working for,
854
00:39:58,163 --> 00:40:00,398
"and so I've got some bonds,
855
00:40:00,398 --> 00:40:02,834
"and I want you to
insure 'em for me
856
00:40:02,834 --> 00:40:04,503
"in case the interest
rate changes.
857
00:40:04,503 --> 00:40:06,572
"Would you insure
these bonds for me?
858
00:40:06,572 --> 00:40:07,673
"How much would you charge?"
859
00:40:07,673 --> 00:40:08,574
You tell me a price.
860
00:40:08,574 --> 00:40:10,676
I say, "That's a good deal.
861
00:40:10,676 --> 00:40:14,412
"I'll get a bonus for
setting up the insurance.
862
00:40:14,412 --> 00:40:15,814
"You'll get a bonus
863
00:40:15,814 --> 00:40:18,149
"for taking in the money
to do the insurance."
864
00:40:18,149 --> 00:40:19,685
- But I work at
a different bank.
865
00:40:19,685 --> 00:40:20,919
- It's a good deal.
866
00:40:20,919 --> 00:40:22,153
- And I heard you
just bought those.
867
00:40:22,153 --> 00:40:23,989
And I figure I could
also get those,
868
00:40:23,989 --> 00:40:25,924
'cause I know a guy in
Saudi Arabia or China
869
00:40:25,924 --> 00:40:28,259
that would pay two cents more,
870
00:40:28,259 --> 00:40:29,761
and I could make
50 grand off it.
871
00:40:29,761 --> 00:40:32,230
- You wind up so far
from the underlying.
872
00:40:32,230 --> 00:40:34,600
- The thing is, it's like the
old insurance principle, it's
873
00:40:34,600 --> 00:40:37,569
"How many people can insure
one person's house"?
874
00:40:37,569 --> 00:40:41,507
Can each person in
the neighborhood put
a $100,000 policy
875
00:40:41,507 --> 00:40:43,709
on that house and each
person collect $100,000
876
00:40:43,709 --> 00:40:46,277
when the $100,000
house burns down?
877
00:40:46,277 --> 00:40:47,879
(explosion roars)
878
00:40:47,879 --> 00:40:49,681
(fire crackling)
879
00:40:49,681 --> 00:40:52,283
(explosion booming)
880
00:40:52,283 --> 00:40:53,785
- As Americans,
we're shortsighted,
881
00:40:53,785 --> 00:40:55,386
and we don't think long-term
882
00:40:55,386 --> 00:40:57,388
and financial literacy
was not this complicated
883
00:40:57,388 --> 00:40:59,357
100 years ago. You had
a little bit of money,
884
00:40:59,357 --> 00:41:00,792
and probably didn't even
have a bank account.
885
00:41:00,792 --> 00:41:02,393
You paid your bills, and
you passed bills around.
886
00:41:02,393 --> 00:41:03,729
- And you kept it
under the mattress.
887
00:41:03,729 --> 00:41:05,030
- Right, or you kept
it under the mattress.
888
00:41:05,030 --> 00:41:06,064
Shh, that's not where mine's at.
889
00:41:06,264 --> 00:41:09,635
- The critical derivatives for
our financial markets today
890
00:41:09,635 --> 00:41:12,971
are actually the ones
that brought down
the financial system
891
00:41:12,971 --> 00:41:16,274
in 2008 were the
credit default swaps
892
00:41:16,274 --> 00:41:18,644
and the collateralized
debt obligations.
893
00:41:18,644 --> 00:41:20,979
And the credit default
swap is basically
894
00:41:20,979 --> 00:41:23,915
a kind of an insurance contract,
895
00:41:23,915 --> 00:41:27,085
which basically says, "If
some assets in the markets
896
00:41:27,085 --> 00:41:31,389
"decline in value, the
insurer has to pay me a fee."
897
00:41:31,389 --> 00:41:34,492
And the beauty of the CDS,
the credit default swap,
898
00:41:34,492 --> 00:41:38,463
was that you didn't have
to hold the asset yourself.
899
00:41:38,463 --> 00:41:40,932
(fire crackling)
900
00:41:40,932 --> 00:41:42,167
It's like me taking out
901
00:41:42,167 --> 00:41:44,936
a fire insurance on
my neighbor's house,
902
00:41:44,936 --> 00:41:47,739
and if that house burns
down, I get the premium.
903
00:41:47,739 --> 00:41:50,676
- The value of these
financial transactions
904
00:41:50,676 --> 00:41:55,246
is much, much larger than
the tangible, real capital,
905
00:41:55,246 --> 00:41:57,683
which is basically the
houses of the families,
906
00:41:57,683 --> 00:41:59,685
the households,
the notional value
907
00:41:59,685 --> 00:42:02,588
of the derivative
market is $600 trillion.
908
00:42:03,354 --> 00:42:05,957
And that is about let's say,
909
00:42:05,957 --> 00:42:08,627
eight to 10 times as
large as global GDP.
910
00:42:16,434 --> 00:42:18,203
- So an American city with
911
00:42:18,203 --> 00:42:19,771
how many trillions of dollars
912
00:42:19,771 --> 00:42:21,840
of real estate
value right there,
913
00:42:21,840 --> 00:42:23,609
or at least hundreds
of billions,
914
00:42:23,609 --> 00:42:25,310
will no longer be there.
915
00:42:25,310 --> 00:42:26,544
Like, how does that work?
916
00:42:26,544 --> 00:42:27,979
How does that work in
the banking sector?
917
00:42:27,979 --> 00:42:29,380
How does that work in
the insurance market,
918
00:42:29,380 --> 00:42:30,782
the re-insurance market,
919
00:42:33,118 --> 00:42:35,621
what's been collateralized
off that real estate?
920
00:42:35,621 --> 00:42:38,389
- This is not just
different actors,
921
00:42:38,389 --> 00:42:40,391
exchanging in different markets
922
00:42:40,391 --> 00:42:43,795
or in different
legal transactions,
923
00:42:43,795 --> 00:42:48,734
our financial system is such
that we have huge banks,
924
00:42:48,734 --> 00:42:51,903
mega banks, too
big to fail banks,
925
00:42:51,903 --> 00:42:56,808
very often operating both
sides of the same market.
926
00:42:56,808 --> 00:43:00,812
- The big banks, they don't
necessarily know how much risk
927
00:43:00,812 --> 00:43:03,982
their counterparty bank
in some other country
928
00:43:03,982 --> 00:43:05,516
is willing to undertake.
- No one really
929
00:43:05,516 --> 00:43:08,053
understands the legal
interdependencies
930
00:43:08,053 --> 00:43:10,088
that are built into
these contracts,
931
00:43:10,088 --> 00:43:11,857
and that can
ultimately bring down
932
00:43:11,857 --> 00:43:13,424
the entire financial system.
933
00:43:13,424 --> 00:43:17,095
- The system is so complicated
934
00:43:17,095 --> 00:43:19,731
that the accountability is lost.
935
00:43:19,731 --> 00:43:21,933
- So the real value
is actually here.
936
00:43:22,000 --> 00:43:23,434
These are all the transactions
937
00:43:23,434 --> 00:43:26,237
which are built on top
of the real economy.
938
00:43:28,774 --> 00:43:31,242
(soft music)
939
00:43:58,636 --> 00:44:00,806
- Then there's Dougherty.
940
00:44:00,806 --> 00:44:03,274
The small town of
Dougherty is not,
941
00:44:03,274 --> 00:44:04,976
not a whole lot there today.
942
00:44:09,547 --> 00:44:13,819
Just it was a town that
once had a general store
943
00:44:13,819 --> 00:44:16,221
when I was growing
up, had the church,
944
00:44:18,489 --> 00:44:21,459
had a post office, but
you know, not anymore.
945
00:44:26,497 --> 00:44:29,600
- Agriculture and rural
America has gotten a preview
946
00:44:29,600 --> 00:44:30,969
of the automation
that's about to hit
947
00:44:30,969 --> 00:44:34,105
the rest of the country
in the next 10 years.
948
00:44:34,105 --> 00:44:37,675
- We're here at the town
square in Dewitt, Arkansas.
949
00:44:37,675 --> 00:44:39,811
And if you look around, I mean
950
00:44:39,811 --> 00:44:42,848
there's not a ton of
bustling businesses here,
951
00:44:42,848 --> 00:44:44,515
but one of the
busiest businesses
952
00:44:44,515 --> 00:44:46,251
is Department of Human Services.
953
00:44:46,617 --> 00:44:48,019
(soft music)
954
00:44:48,253 --> 00:44:52,858
So when we define the real
economy, let's not forget farms.
955
00:44:52,858 --> 00:44:56,461
88% are still
small family farms.
956
00:44:56,461 --> 00:44:59,630
- So this is a grain storage bin
957
00:44:59,630 --> 00:45:02,934
on my parents' family farm.
958
00:45:02,934 --> 00:45:05,370
(soft music)
959
00:45:12,377 --> 00:45:14,712
- This is my dad's place.
960
00:45:15,546 --> 00:45:18,884
He's gonna be 87, mom's 85.
961
00:45:18,884 --> 00:45:21,386
They've lived here since 1956.
962
00:45:24,222 --> 00:45:29,727
So, a lot of years.
963
00:45:31,729 --> 00:45:33,331
- And we are a team.
964
00:45:37,302 --> 00:45:40,705
- How many times you have
to have intense rains,
965
00:45:40,705 --> 00:45:44,475
heat spells, freezings at the
wrong point to get the crops
966
00:45:44,475 --> 00:45:46,744
to not come in once?
967
00:45:46,744 --> 00:45:49,881
- We do protect our farmers,
we give them crop insurance
968
00:45:49,881 --> 00:45:52,183
and the crop insurance
is subsidized.
969
00:45:52,183 --> 00:45:54,752
We have agricultural
extension services,
970
00:45:54,752 --> 00:45:56,587
and they pay for that, but
they probably don't pay
971
00:45:56,587 --> 00:45:57,722
the full cost of that.
972
00:45:58,656 --> 00:46:00,658
It's a free market economy but,
973
00:46:00,658 --> 00:46:02,427
it's also a national
security issue.
974
00:46:08,934 --> 00:46:12,237
(birds chirping)
975
00:46:12,237 --> 00:46:13,604
- Federal crop insurance program
976
00:46:13,604 --> 00:46:16,274
was started as a
response to the effects
977
00:46:16,274 --> 00:46:18,743
of the dust bowl and
the Great Depression.
978
00:46:18,743 --> 00:46:21,412
Many, many areas throughout
the United States were,
979
00:46:21,412 --> 00:46:24,615
were severely affected
by the Dust Bowl,
980
00:46:24,615 --> 00:46:26,952
many farmers lost everything.
981
00:46:26,952 --> 00:46:28,954
In addition to most of America
982
00:46:28,954 --> 00:46:30,555
being devastated
by the depression,
983
00:46:30,555 --> 00:46:34,893
farmers acutely suffered
during that time.
984
00:46:36,761 --> 00:46:39,364
(somber music)
985
00:46:45,570 --> 00:46:47,272
Many parts of the plains
986
00:46:47,272 --> 00:46:50,575
were just completely
filled with dust.
987
00:46:50,575 --> 00:46:53,979
Many crops were lost
due to the weather,
988
00:46:53,979 --> 00:46:56,481
the extreme weather,
due to insects.
989
00:46:59,650 --> 00:47:02,153
(somber music)
990
00:47:12,163 --> 00:47:14,332
- But it's the large
scale like my dad said,
991
00:47:14,332 --> 00:47:17,435
the large scale events that
everybody kinda worries about,
992
00:47:17,435 --> 00:47:19,004
like a big drought.
993
00:47:24,509 --> 00:47:28,179
- I think that our
aquifer in some places
994
00:47:28,179 --> 00:47:32,951
is down to like 20% and
then a lot of places at 50%,
995
00:47:32,951 --> 00:47:35,420
and we're actually
using more water than
996
00:47:36,521 --> 00:47:38,289
we have at any other time.
997
00:47:40,191 --> 00:47:42,627
We have our pumping plants in
998
00:47:42,627 --> 00:47:44,862
and we're building on canals
999
00:47:44,862 --> 00:47:46,998
and this is actually
the first phase.
1000
00:47:46,998 --> 00:47:50,668
We're trying to get water
to this, this Indian bio
1001
00:47:50,668 --> 00:47:55,673
and then we're gonna use that
for the main water supply.
1002
00:47:56,607 --> 00:47:59,544
In Arkansas, we're gonna
have a drought event,
1003
00:47:59,544 --> 00:48:01,046
every growing season.
1004
00:48:02,647 --> 00:48:04,715
It doesn't matter,
if we just came
1005
00:48:04,715 --> 00:48:06,851
like this last flood
that we had here,
1006
00:48:06,851 --> 00:48:09,054
as soon as we came out
of that flood event,
1007
00:48:09,054 --> 00:48:15,660
we were irrigating because our
soil is, it's not real deep.
1008
00:48:15,793 --> 00:48:18,196
We have what they call a
hard pan underneath it,
1009
00:48:18,196 --> 00:48:19,897
pretty close to the surface
1010
00:48:19,897 --> 00:48:21,399
- Which helps with
the rice growing.
1011
00:48:21,399 --> 00:48:22,733
- Yes, very helpful.
1012
00:48:24,569 --> 00:48:26,972
It just gets more
expensive every day.
1013
00:48:26,972 --> 00:48:28,473
We thought we were gonna have
1014
00:48:28,473 --> 00:48:31,342
a lot of infrastructure
money maybe to come about,
1015
00:48:31,342 --> 00:48:33,644
but it hasn't come about.
1016
00:48:33,644 --> 00:48:35,746
- And its federal infrastructure
money that coming?
1017
00:48:35,746 --> 00:48:38,249
- Well, the way that was
originally set up was that,
1018
00:48:38,249 --> 00:48:44,489
the federal government was
gonna be responsible for 65%
1019
00:48:44,489 --> 00:48:48,759
the state 10, and our
local district, 25.
1020
00:48:48,759 --> 00:48:50,761
And there's a lot of
people benefit from this
1021
00:48:50,761 --> 00:48:52,430
other than just the farmers,
1022
00:48:52,430 --> 00:48:55,333
but that's, who's
got to pay for it
1023
00:48:55,333 --> 00:48:56,734
'cause those are only the ones
1024
00:48:56,734 --> 00:48:58,336
that's actually using the water.
1025
00:49:00,205 --> 00:49:01,606
- And I'm assuming
we'll have to do
1026
00:49:01,606 --> 00:49:03,341
a whole bunch of
stuff like that.
1027
00:49:03,341 --> 00:49:07,778
As temperature rises and
rain patterns change.
1028
00:49:07,778 --> 00:49:10,348
When every person we've
talked to about farming
1029
00:49:10,348 --> 00:49:12,117
and different methods of farming
1030
00:49:12,117 --> 00:49:17,122
whether it's till or no
till or organic or not.
1031
00:49:17,122 --> 00:49:18,123
(tractor engine purring)
1032
00:49:18,123 --> 00:49:19,757
Each piece of land is different.
1033
00:49:20,558 --> 00:49:23,128
And each little
community is different.
1034
00:49:23,128 --> 00:49:25,096
And the ecosystem
there is different.
1035
00:49:25,096 --> 00:49:28,633
So how can a giant JP Morgan,
1036
00:49:28,633 --> 00:49:32,137
how can they service
a community like this?
1037
00:49:32,137 --> 00:49:35,140
- Well, and why
would they want to?
- Yeah.
1038
00:49:35,140 --> 00:49:36,974
- That's the rest of the story.
1039
00:49:36,974 --> 00:49:38,309
I mean, that's not
gonna be a profit center
1040
00:49:38,309 --> 00:49:40,278
for them to come out
here and look at a man
1041
00:49:40,278 --> 00:49:43,281
that's farming
2,000, 3,000 acres.
1042
00:49:43,281 --> 00:49:47,985
They're looking for
20, 50,000 acre farms
1043
00:49:47,985 --> 00:49:51,822
to where they can justify
spending some time on them.
1044
00:49:52,657 --> 00:49:55,726
- The relationships with the
banks they've gotten big too.
1045
00:49:55,726 --> 00:49:57,328
But it used to be
these smaller banks
1046
00:49:57,328 --> 00:50:02,267
and they knew your
dad and his dad.
1047
00:50:02,267 --> 00:50:04,835
If you went to a farm sale and
"Hey I liked this tractor."
1048
00:50:04,835 --> 00:50:07,838
and it was $27,000.
1049
00:50:07,838 --> 00:50:10,075
You just call the bank
and say, "Hey, I need it."
1050
00:50:10,075 --> 00:50:11,509
"Okay, it's in your account."
1051
00:50:11,509 --> 00:50:14,011
(gentle foreboding music)
1052
00:50:14,011 --> 00:50:18,516
- 60 years ago if you made a
crop, you made money period.
1053
00:50:18,516 --> 00:50:21,819
If you made a crop,
you paid all your bills
1054
00:50:21,819 --> 00:50:23,521
and you could send
your kids to school
1055
00:50:23,521 --> 00:50:25,190
and you buy your groceries.
1056
00:50:25,190 --> 00:50:26,491
You were okay.
1057
00:50:27,125 --> 00:50:31,196
Today, you can make a
crop and lose your assets.
1058
00:50:31,196 --> 00:50:34,499
(gentle ominous music)
1059
00:50:36,101 --> 00:50:38,035
(tractor engine revving)
1060
00:50:38,035 --> 00:50:41,672
- Everybody out here,
it's all family and,
1061
00:50:44,375 --> 00:50:49,046
I mean, if you were 30
years ago when we did this
1062
00:50:49,046 --> 00:50:54,285
we get all, a
combine was $35,000.
1063
00:50:54,819 --> 00:51:00,291
And now a combine is $400,000.
1064
00:51:00,491 --> 00:51:03,961
(light airy music)
1065
00:51:03,961 --> 00:51:06,464
- When you're looking
at machines that,
1066
00:51:06,464 --> 00:51:08,199
so by the time you
have your headers
1067
00:51:08,199 --> 00:51:10,168
and your everything
to go with it
1068
00:51:10,168 --> 00:51:13,070
being upward close to
half a million dollars.
1069
00:51:15,072 --> 00:51:16,741
Where else is
someone else buying
1070
00:51:16,741 --> 00:51:18,543
half a million dollar equipment
1071
00:51:18,543 --> 00:51:21,379
and I'm barely making ends meet.
1072
00:51:21,379 --> 00:51:24,749
(tractor engine revving)
1073
00:51:25,750 --> 00:51:28,219
It gets more
challenging every year.
1074
00:51:28,219 --> 00:51:34,525
- The cost of production
and agricultural costs
1075
00:51:34,659 --> 00:51:38,363
or just to be a farmer
and even a small farmer
1076
00:51:38,363 --> 00:51:39,997
are almost cost prohibitive
1077
00:51:39,997 --> 00:51:43,868
unless your family has been
in farming for generations.
1078
00:51:43,868 --> 00:51:47,205
- Thank God almighty for
such a good looking crop
1079
00:51:47,938 --> 00:51:51,008
while others have
had to struggle.
1080
00:51:51,008 --> 00:51:52,243
(light airy music)
1081
00:51:52,243 --> 00:51:53,544
- Oh, here's some fellows.
1082
00:51:53,544 --> 00:51:55,680
- Yeah, that's who
we're riding with.
1083
00:51:55,680 --> 00:51:56,947
Y'all be riding with him.
1084
00:51:56,947 --> 00:51:59,684
(phone ringing)
1085
00:51:59,684 --> 00:52:01,686
(indistinct)
1086
00:52:01,686 --> 00:52:03,020
Alright, thanks Zach.
1087
00:52:03,020 --> 00:52:04,289
See you there.
1088
00:52:04,289 --> 00:52:07,358
(tractor engine revving)
1089
00:52:07,358 --> 00:52:09,227
- Farms are similar
to owning a house.
1090
00:52:09,227 --> 00:52:10,961
You've gotta clean the gutters.
1091
00:52:10,961 --> 00:52:13,364
You've gotta sweep the sidewalk.
1092
00:52:13,364 --> 00:52:14,765
And the same thing with a farm
1093
00:52:14,765 --> 00:52:17,968
you've got certain maintenance
that have to be done
1094
00:52:17,968 --> 00:52:20,471
on annual basis to keep
it in a working order.
1095
00:52:22,407 --> 00:52:26,377
- Before automation, everything
in here is handwritten.
1096
00:52:27,278 --> 00:52:29,780
- 24th, 1955.
1097
00:52:29,780 --> 00:52:31,449
- Yep. And everyday...
1098
00:52:31,449 --> 00:52:33,451
- And that's everything that
happened during that day
1099
00:52:33,451 --> 00:52:34,885
all the money that came in.
1100
00:52:34,885 --> 00:52:36,654
- They made four loans.
1101
00:52:36,654 --> 00:52:39,324
Like this is, these are the
loans that we made that day.
1102
00:52:39,324 --> 00:52:44,262
And you see the size of
the loans; $150, $500.
1103
00:52:44,262 --> 00:52:45,896
- The countryside across America
1104
00:52:45,896 --> 00:52:48,299
not just in our rural community
but other rural communities
1105
00:52:48,299 --> 00:52:51,168
used to have a lot of
small community banks
1106
00:52:51,168 --> 00:52:55,005
that were very plugged
into their communities
1107
00:52:55,005 --> 00:52:56,474
and to the people
that live there.
1108
00:52:56,474 --> 00:52:57,675
And trying to help them
1109
00:52:57,675 --> 00:52:59,810
grow their businesses
and their lives.
1110
00:52:59,810 --> 00:53:03,514
So just afraid of what the
landscape holds going forward.
1111
00:53:03,514 --> 00:53:05,015
You're just a number,
1112
00:53:05,015 --> 00:53:07,117
you're CUSIP number
on a bond security
1113
00:53:07,117 --> 00:53:09,119
and here's where you
mail your check now.
1114
00:53:09,119 --> 00:53:12,357
- It's getting harder and
harder for those farmers
1115
00:53:12,357 --> 00:53:15,826
to stay in business because
they cannot get the funding.
1116
00:53:15,826 --> 00:53:19,997
Because with each year
of them incurring loss
1117
00:53:19,997 --> 00:53:22,032
and then no hope of...
1118
00:53:22,967 --> 00:53:25,503
The prices don't get
better the next year
1119
00:53:25,503 --> 00:53:28,939
regardless of the type
of natural disasters
1120
00:53:28,939 --> 00:53:30,375
and things that happen.
1121
00:53:30,375 --> 00:53:32,277
And so the farmer gets
further and further behind
1122
00:53:32,277 --> 00:53:34,779
and we've had several
farmers that are actually
1123
00:53:34,779 --> 00:53:36,013
going out of business.
1124
00:53:36,013 --> 00:53:37,214
They're having to
sell their equipment
1125
00:53:37,214 --> 00:53:40,885
and turn the farm over
to someone else to farm.
1126
00:53:40,885 --> 00:53:44,221
(gentle ominous music)
1127
00:53:44,221 --> 00:53:47,057
- It's actually something
that I have no control over.
1128
00:53:47,057 --> 00:53:48,559
And none of us around
in England, Arkansas
1129
00:53:48,559 --> 00:53:50,227
have any control over.
1130
00:53:53,398 --> 00:53:56,401
And at the last
one, like in 2008
1131
00:53:56,401 --> 00:53:57,902
when they were saying that,
1132
00:53:57,902 --> 00:54:00,405
"The banks wouldn't have money
to loan to your farmers."
1133
00:54:01,539 --> 00:54:03,908
And I had several
farmers that were just
1134
00:54:03,908 --> 00:54:05,175
pulling their hair out.
1135
00:54:05,175 --> 00:54:07,211
They were just, "Are you
gonna be able to loan me
1136
00:54:07,211 --> 00:54:08,913
enough money to
finish this crop?"
1137
00:54:08,913 --> 00:54:10,180
And I finally told him,
1138
00:54:10,180 --> 00:54:11,682
"Just go home and
watch Andy Griffith
1139
00:54:12,750 --> 00:54:15,886
and quit watching CNN and Fox."
1140
00:54:15,886 --> 00:54:19,089
And said, "You know,
as far as I know
1141
00:54:19,089 --> 00:54:21,992
we're gonna have the money and
we're gonna take care of you
1142
00:54:22,760 --> 00:54:27,932
and you need to quit
watching all of those..."
1143
00:54:28,499 --> 00:54:29,867
- Stuff to scare you.
1144
00:54:29,867 --> 00:54:31,936
- Yeah. That you
have no control over.
1145
00:54:31,936 --> 00:54:35,373
So a couple of weeks later,
he came back and said,
1146
00:54:35,373 --> 00:54:36,707
"You know that was
the best advice
1147
00:54:36,707 --> 00:54:39,076
I've gotten so far this year."
1148
00:54:39,076 --> 00:54:42,079
- The rainfall amounts, we
don't get an inch anymore.
1149
00:54:42,079 --> 00:54:45,015
It's either three
inches or nothing.
1150
00:54:45,015 --> 00:54:46,451
Everything is extremes.
1151
00:54:46,451 --> 00:54:49,720
(gentle ominous music)
1152
00:54:53,791 --> 00:54:57,795
(gentle foreboding music)
1153
00:54:57,795 --> 00:55:02,299
- Many of those restrictions
on banks are being peeled back.
1154
00:55:02,299 --> 00:55:04,469
So we still have
trading in derivatives.
1155
00:55:04,469 --> 00:55:07,405
It's not, we don't
know what it is.
1156
00:55:07,405 --> 00:55:10,541
There's hundreds of
trillions of dollars
1157
00:55:10,541 --> 00:55:15,546
maybe 600, maybe 800 trillions
of dollars of derivatives
1158
00:55:15,713 --> 00:55:20,317
on currency exchanges
that can't be covered.
1159
00:55:20,317 --> 00:55:22,920
(gentle ominous music)
1160
00:55:22,920 --> 00:55:24,321
- It's like after 1980s it was,
1161
00:55:24,321 --> 00:55:26,223
"Oh, Gordon Gekko
is a great guy.
1162
00:55:26,223 --> 00:55:27,825
He taught us greed is good."
1163
00:55:27,825 --> 00:55:28,793
Look what it's gotten us.
1164
00:55:28,793 --> 00:55:30,395
- It's a cycle in America.
1165
00:55:30,395 --> 00:55:31,762
You have to create wealth.
1166
00:55:31,762 --> 00:55:33,163
You can't create wealth
1167
00:55:33,163 --> 00:55:35,966
by just taking it from
other people through taxes.
1168
00:55:35,966 --> 00:55:37,968
People have to be
incentivized to create wealth.
1169
00:55:38,002 --> 00:55:39,504
And this has been the great-
- Okay, but wait a minute-
1170
00:55:39,504 --> 00:55:41,972
- This has been
the great virtues
1171
00:55:41,972 --> 00:55:44,308
of Western democracy
for 300 years...
1172
00:55:44,308 --> 00:55:46,944
- But it's also been the
massively misunderstood.
1173
00:55:46,944 --> 00:55:50,748
So go back to the
post-civil war United States
1174
00:55:50,748 --> 00:55:51,916
and the growth.
1175
00:55:51,916 --> 00:55:54,919
The growth was made off land
1176
00:55:54,919 --> 00:55:57,788
that people were literally
killed and chased off of
1177
00:55:57,788 --> 00:56:01,492
and they're like, "Hey man,
look at all this free land."
1178
00:56:01,692 --> 00:56:03,861
And that's how money was made.
1179
00:56:07,197 --> 00:56:10,267
- You have to resolve that we
can do better going forward.
1180
00:56:12,036 --> 00:56:16,106
American capitalism can
be pretty heartless.
1181
00:56:17,307 --> 00:56:18,976
If you look back at
the American Civil War
1182
00:56:18,976 --> 00:56:21,045
and what happened
right afterwards,
1183
00:56:21,045 --> 00:56:23,648
we industrialized America,
we went into the Gilded Age.
1184
00:56:23,648 --> 00:56:26,451
People look at these
"robber barons" and said,
1185
00:56:26,451 --> 00:56:27,852
"This can't last."
1186
00:56:27,852 --> 00:56:30,387
(somber music)
1187
00:56:31,722 --> 00:56:34,124
And we ended up in the
progressive movement.
1188
00:56:36,326 --> 00:56:38,228
This is the age of Reagan.
1189
00:56:38,228 --> 00:56:40,297
The Reagan era
was the relaxation
1190
00:56:40,297 --> 00:56:41,999
of the administrative state.
1191
00:56:41,999 --> 00:56:46,804
It was the sort of, let
big firms get bigger.
1192
00:56:46,804 --> 00:56:48,405
It's let's make money.
1193
00:56:48,405 --> 00:56:49,707
Let's do it all with money.
1194
00:56:49,707 --> 00:56:51,909
Let's let charities
take care of people.
1195
00:56:51,909 --> 00:56:53,911
Forget about
government programs.
1196
00:56:53,911 --> 00:56:56,346
And that's run since
Reagan was elected.
1197
00:56:57,815 --> 00:57:00,017
- Thank you very much.
1198
00:57:00,017 --> 00:57:01,519
- I was raised red.
1199
00:57:01,519 --> 00:57:03,688
I was raised in a red family.
1200
00:57:05,089 --> 00:57:07,191
I grew up in the '80s.
1201
00:57:07,191 --> 00:57:10,194
(upbeat '80s music)
1202
00:57:19,737 --> 00:57:22,439
Fell in love with Ronald Reagan.
1203
00:57:22,439 --> 00:57:23,841
I idolized Reagan.
1204
00:57:23,841 --> 00:57:27,077
I saw Reagan and I
said, "I want his job."
1205
00:57:27,077 --> 00:57:31,115
In fact, my parents told me
I mailed him a dollar bill.
1206
00:57:31,115 --> 00:57:35,252
I defaced the dollar bill
with my picture on it.
1207
00:57:35,252 --> 00:57:38,789
- The maxim is,
Doveryai, no proveryai
1208
00:57:38,789 --> 00:57:41,125
trust but verify.
1209
00:57:41,125 --> 00:57:43,561
(audience laughing)
1210
00:57:43,628 --> 00:57:45,630
- [Translator] (speaking
foreign language)
1211
00:57:45,630 --> 00:57:47,798
- (speaking foreign language)
1212
00:57:47,798 --> 00:57:49,967
- [Translator] You repeat
that at every meeting.
1213
00:57:49,967 --> 00:57:51,602
(audience laughing)
1214
00:57:51,602 --> 00:57:54,138
- But I wanted to
be in politics.
1215
00:57:54,138 --> 00:57:57,542
I wanted to be the first woman,
president of United States.
1216
00:57:57,542 --> 00:57:59,209
I thought it was fascinating.
1217
00:57:59,209 --> 00:58:00,878
- We can leave our children
1218
00:58:00,878 --> 00:58:05,082
with an unrepayable, massive
debt and shattered economy
1219
00:58:05,082 --> 00:58:07,484
or we can leave them liberty
1220
00:58:07,484 --> 00:58:09,486
in a land where every individual
1221
00:58:09,486 --> 00:58:12,823
has the opportunity to be
whatever God intended us to be.
1222
00:58:14,892 --> 00:58:17,061
- People like to say
economics is a science
1223
00:58:17,061 --> 00:58:19,564
but it really follows politics.
1224
00:58:19,564 --> 00:58:23,668
Keynes came out and looked at
it, he saw the political need.
1225
00:58:23,668 --> 00:58:26,003
That's how we understood
macroeconomics.
1226
00:58:26,003 --> 00:58:27,237
Friedman came out
and looked at it
1227
00:58:27,237 --> 00:58:29,674
and he saw deficit spending
1228
00:58:29,674 --> 00:58:33,243
and he saw government control
and he saw high taxes,
1229
00:58:33,243 --> 00:58:34,745
and he said, there has
to be a better way.
1230
00:58:34,745 --> 00:58:37,848
He reinvented
classical economics.
1231
00:58:37,848 --> 00:58:40,017
They called it
Neoliberal Economics.
1232
00:58:40,017 --> 00:58:43,153
- Quoted Milton
Friedman and said that,
1233
00:58:43,153 --> 00:58:46,657
that how the economy
of the United States
1234
00:58:46,657 --> 00:58:51,195
oughta be judged by the
number of imports that we have
1235
00:58:51,195 --> 00:58:52,462
and not exports.
1236
00:58:52,462 --> 00:58:55,199
And I thought maybe this
was a typo or something.
1237
00:58:55,933 --> 00:59:00,037
And so I asked him, I said,
"I mean, are you for real?"
1238
00:59:00,037 --> 00:59:03,307
- Trickle-down economics
starts in 1980.
1239
00:59:03,307 --> 00:59:04,208
It's right around in there.
1240
00:59:04,208 --> 00:59:05,976
Late '70s, we get into it.
1241
00:59:05,976 --> 00:59:07,945
But the bottom line is,
has two parts to it.
1242
00:59:07,945 --> 00:59:09,714
First fire the cops.
1243
00:59:09,714 --> 00:59:12,049
Not the cops on Main Street,
the cops on Wall Street.
1244
00:59:12,049 --> 00:59:13,217
Turn them loose.
1245
00:59:13,217 --> 00:59:15,385
Let those banks do
whatever they wanna do.
1246
00:59:15,385 --> 00:59:19,690
- And so here we are now, 40
years into the age of Reagan
1247
00:59:19,690 --> 00:59:21,892
and people are looking
at what it's done, okay.
1248
00:59:21,892 --> 00:59:23,894
It's made a lot of
people really wealthy.
1249
00:59:24,328 --> 00:59:28,032
We won the Cold War
during that period.
1250
00:59:28,032 --> 00:59:31,802
Not necessarily because of
that, but we won the Cold War.
1251
00:59:31,802 --> 00:59:36,340
And America became
this supreme power.
1252
00:59:36,340 --> 00:59:39,576
But for the people of America,
it hasn't been so good.
1253
00:59:39,576 --> 00:59:41,545
- I know, their real
wages went down.
1254
00:59:41,545 --> 00:59:44,414
- Real wages went down and
people in this country look back
1255
00:59:44,414 --> 00:59:45,716
and they wanna make America
1256
00:59:45,716 --> 00:59:47,584
as great as it was in the 1950s.
1257
00:59:47,584 --> 00:59:50,254
That's when the marginal
tax rate was 91%.
1258
00:59:50,254 --> 00:59:51,088
- [Man] I know.
1259
00:59:53,590 --> 00:59:55,660
- Ronald Reagan, my
mother loved him.
1260
00:59:55,660 --> 00:59:58,663
She watched him every
Sunday night on GE Theater.
1261
00:59:58,663 --> 01:00:02,032
At the end, he would say,
"At General Electric,
1262
01:00:02,032 --> 01:00:04,835
progress is our most
important product."
1263
01:00:06,671 --> 01:00:08,605
- [Wesley] What would
wrong Reagan say,
1264
01:00:08,605 --> 01:00:13,177
if you told him that GE spends
more money on stock buybacks
1265
01:00:13,177 --> 01:00:15,112
than it does on R&D?
1266
01:00:15,112 --> 01:00:18,448
In 1950, stock
buybacks were illegal.
1267
01:00:18,448 --> 01:00:21,351
They were considered
market manipulation.
1268
01:00:22,286 --> 01:00:25,355
Now, investment analysts
look at that company and say
1269
01:00:25,355 --> 01:00:27,091
"A lot of companies
are really smart.
1270
01:00:27,091 --> 01:00:28,859
I think their stocks
gonna continue to grow up
1271
01:00:28,859 --> 01:00:32,963
because they've got a really
great stock buyback program."
1272
01:00:32,963 --> 01:00:34,965
It does nothing for the economy.
1273
01:00:39,303 --> 01:00:41,471
- The average American is...
1274
01:00:41,471 --> 01:00:43,808
they're living in
the GDP of 1980.
1275
01:00:43,808 --> 01:00:45,109
- Yeah.
1276
01:00:45,109 --> 01:00:46,777
I mean, yeah, clearly
the world has changed,
1277
01:00:46,777 --> 01:00:48,813
and the commodities you can buy
1278
01:00:48,813 --> 01:00:50,080
are not the same commodities,
1279
01:00:50,080 --> 01:00:51,648
but in terms of your
let's say average
1280
01:00:51,648 --> 01:00:53,818
to the extent that we can
measure living standards,
1281
01:00:53,818 --> 01:00:55,585
living standards
have not improved.
1282
01:00:56,320 --> 01:00:59,489
Firms finance their investment
out of their profits,
1283
01:00:59,489 --> 01:01:00,991
that's what people think.
1284
01:01:00,991 --> 01:01:03,828
Now, if you look at the 500
biggest U.S corporations,
1285
01:01:03,828 --> 01:01:07,264
50% of the profits
are paid as dividends,
1286
01:01:07,264 --> 01:01:10,667
50% of the profits are
useful buying back stocks.
1287
01:01:10,667 --> 01:01:12,803
All the profits
dissipate, are gone.
1288
01:01:12,803 --> 01:01:15,005
So how do they finance
their investment?
1289
01:01:15,005 --> 01:01:16,406
If they--
- Debt!
1290
01:01:16,406 --> 01:01:17,341
- Debt.
1291
01:01:18,776 --> 01:01:20,677
- [Newsman] The president
expressed surprise
1292
01:01:20,677 --> 01:01:22,847
about the collapse on
the markets yesterday.
1293
01:01:22,847 --> 01:01:26,483
He's still enduring popularity
as much to the economic boom
1294
01:01:26,483 --> 01:01:29,519
that America has enjoyed
under his leadership.
1295
01:01:29,519 --> 01:01:32,857
- More people are working
than ever before in history
1296
01:01:32,857 --> 01:01:35,692
where our productivity is up
1297
01:01:35,692 --> 01:01:38,695
so is our manufacturing
product up.
1298
01:01:39,930 --> 01:01:43,868
There is no runaway inflation
as there has been in the past.
1299
01:01:43,868 --> 01:01:47,772
So as I say, I don't
think anyone should panic
1300
01:01:47,772 --> 01:01:51,041
because all the economic
indicators are solid.
1301
01:01:53,210 --> 01:01:55,712
- [Newsman] But the warning
signs have long been there
1302
01:01:55,712 --> 01:01:58,348
in the closed factories in
many American small towns.
1303
01:01:59,049 --> 01:02:00,450
- I mean, there is this notion
1304
01:02:00,450 --> 01:02:02,452
of billionaires
creating employment,
1305
01:02:02,452 --> 01:02:05,655
and that is
trickle-down economics.
1306
01:02:05,655 --> 01:02:07,724
The problem about that
is that in history,
1307
01:02:07,724 --> 01:02:09,226
it has never happened.
1308
01:02:09,226 --> 01:02:11,661
There is no such thing as
trickle-down economics.
1309
01:02:11,661 --> 01:02:13,463
It simply doesn't exist.
1310
01:02:13,463 --> 01:02:15,399
- [Man] It really
is voodoo economics.
1311
01:02:18,735 --> 01:02:20,805
(bird cawing)
1312
01:02:20,805 --> 01:02:23,140
- When you put the smartest
people in the world in finance
1313
01:02:23,140 --> 01:02:24,308
which is what we've done
1314
01:02:24,308 --> 01:02:26,743
for the last 25 years
in this country,
1315
01:02:26,743 --> 01:02:30,848
you can't hold back
their imagination
and their creativity.
1316
01:02:32,649 --> 01:02:34,751
- The speed and scale of
global economic change
1317
01:02:34,751 --> 01:02:36,753
has overwhelmed the
national systems
1318
01:02:36,753 --> 01:02:38,655
of rules and regulations.
1319
01:02:38,655 --> 01:02:40,557
So our first test
is to agree tougher
1320
01:02:40,557 --> 01:02:44,094
and more transparent supervision
of banks, hedge funds
1321
01:02:44,094 --> 01:02:46,831
and what is known as the
global shadow banking system.
1322
01:02:50,100 --> 01:02:52,402
- And so when you
get right down to it,
1323
01:02:52,402 --> 01:02:53,770
I'm a licensed banker.
1324
01:02:53,770 --> 01:02:56,440
And so when the regulators
come to my bank,
1325
01:02:56,440 --> 01:02:58,042
we're very simple little bank.
1326
01:02:58,042 --> 01:03:00,344
They look for the SOP,
they look for due diligence
1327
01:03:00,344 --> 01:03:02,079
on projects we've done.
1328
01:03:02,079 --> 01:03:03,613
It's pretty easy.
1329
01:03:03,613 --> 01:03:08,352
You go to a big bank, Wells
or JP Morgan or Goldman,
1330
01:03:08,352 --> 01:03:09,887
and you're a regular like,
1331
01:03:09,887 --> 01:03:12,522
"What is this? I see these
emails and... " I mean,
1332
01:03:13,290 --> 01:03:15,359
they don't understand it because
they're not working in it.
1333
01:03:15,359 --> 01:03:16,260
They didn't invent it.
1334
01:03:16,393 --> 01:03:17,862
- Sure.
- It's like trying
to teach people
1335
01:03:17,862 --> 01:03:19,964
a theory of quantum gravity
1336
01:03:19,964 --> 01:03:22,032
when they've had a high
school physics course
1337
01:03:22,032 --> 01:03:24,734
and they're inspecting
Stephen Hawking or something.
1338
01:03:24,734 --> 01:03:27,905
(gentle music)
1339
01:03:27,905 --> 01:03:29,706
- [Katharina] The earth is
like a bounded natural system
1340
01:03:29,706 --> 01:03:32,042
that can't expand forever.
1341
01:03:32,042 --> 01:03:33,477
The beauty of the legal code
1342
01:03:33,477 --> 01:03:35,880
and derivatives are a
product of the legal code
1343
01:03:35,880 --> 01:03:39,416
is that we can expand it
how far we want, right?
1344
01:03:39,416 --> 01:03:41,085
So we always create
new types of assets,
1345
01:03:41,085 --> 01:03:44,721
we create new types of
legal tricks in the end,
1346
01:03:44,721 --> 01:03:47,157
and the two systems are
not easily compatible.
1347
01:03:47,157 --> 01:03:49,826
(gentle music)
1348
01:03:51,295 --> 01:03:53,163
- If you're very rich and
you gamble with your money
1349
01:03:53,163 --> 01:03:54,999
and you lose it in Las Vegas,
1350
01:03:54,999 --> 01:03:58,135
that is what you want
and it's your problem.
1351
01:03:58,135 --> 01:04:02,572
But here, if they lose their
money here, it is our problem.
1352
01:04:03,240 --> 01:04:04,841
- The market can't punish
1353
01:04:04,841 --> 01:04:06,843
for things it doesn't
know anything about.
1354
01:04:06,843 --> 01:04:09,079
- And they haven't
factored any of the risks
1355
01:04:09,079 --> 01:04:11,781
that all this could change.
1356
01:04:11,781 --> 01:04:14,151
- Natural disaster could
have major repercussions
1357
01:04:14,151 --> 01:04:15,652
for our financial system,
1358
01:04:15,652 --> 01:04:19,023
just because they will have
an effect on the asset values.
1359
01:04:19,023 --> 01:04:20,190
- [Roosevelt] The new law
1360
01:04:20,190 --> 01:04:23,360
allows the 12
federal reserve banks
1361
01:04:23,360 --> 01:04:26,863
to issue additional
currency on good assets
1362
01:04:26,863 --> 01:04:30,367
and thus the banks that
reopen will be able to meet
1363
01:04:30,367 --> 01:04:32,502
every legitimate call.
1364
01:04:32,502 --> 01:04:34,438
It is sound currency
1365
01:04:34,438 --> 01:04:39,209
because it is backed
by actual good assets.
1366
01:04:39,209 --> 01:04:41,811
(water gurgles)
1367
01:04:41,811 --> 01:04:44,048
(sizzling)
1368
01:04:45,149 --> 01:04:49,486
(helicopter engine revving)
1369
01:04:49,486 --> 01:04:52,389
(gentle music)
1370
01:04:52,389 --> 01:04:55,459
- And so what happens is
that there's an event.
1371
01:04:55,459 --> 01:04:59,329
And then when the event
happens, then everybody wakes up
1372
01:04:59,329 --> 01:05:02,799
and sadly there's what we
call in a financial system,
1373
01:05:02,799 --> 01:05:06,971
contagion, and people
unload, they unload stocks,
1374
01:05:06,971 --> 01:05:09,473
they try to get their
derivatives repaid.
1375
01:05:09,473 --> 01:05:11,875
They want their insurance
policies cashed.
1376
01:05:11,875 --> 01:05:13,810
And the market
starts to unravel.
1377
01:05:14,478 --> 01:05:16,413
When the market
starts to go down,
1378
01:05:16,413 --> 01:05:19,516
the plugs get pulled everywhere.
1379
01:05:19,516 --> 01:05:21,918
And so what you're dealing
with in climate change,
1380
01:05:21,918 --> 01:05:24,254
it's not only the direct impact,
1381
01:05:24,254 --> 01:05:26,656
but also the possibility
of contagion.
1382
01:05:26,656 --> 01:05:27,757
- Economic contagion.
1383
01:05:27,757 --> 01:05:28,592
- Economic contagion.
- Financial.
1384
01:05:28,592 --> 01:05:29,526
- Yep.
1385
01:05:29,526 --> 01:05:30,760
(air blowing)
1386
01:05:30,760 --> 01:05:32,329
- Those views are
merely forecasts,
1387
01:05:32,329 --> 01:05:35,332
and as always will
evolve with the arrival
1388
01:05:35,332 --> 01:05:36,533
of new information.
1389
01:05:36,533 --> 01:05:37,767
(sirens blaring)
1390
01:05:37,767 --> 01:05:39,236
- Mike, they're on the
bell, hold the bell.
1391
01:05:39,236 --> 01:05:41,738
(indistinct) the bells.
1392
01:05:41,738 --> 01:05:43,440
- We actually have made it clear
1393
01:05:43,440 --> 01:05:46,376
that we will bail out
these financial actors.
1394
01:05:46,376 --> 01:05:47,577
We will bail them.
1395
01:05:47,577 --> 01:05:49,446
This cannot be sustained.
1396
01:05:49,446 --> 01:05:51,581
- If it runs only because
the central banks go in
1397
01:05:51,581 --> 01:05:53,283
and buy assets, right?
1398
01:05:53,283 --> 01:05:54,884
Recently it was
proposed that the
1399
01:05:54,884 --> 01:05:56,253
European Central Bank
1400
01:05:56,253 --> 01:05:58,855
should also start buying
shares of companies.
1401
01:05:58,855 --> 01:06:01,525
So not only debt, but shares.
1402
01:06:01,525 --> 01:06:04,961
So we're effectively
socializing the obligation
1403
01:06:04,961 --> 01:06:07,531
to create financial returns
1404
01:06:07,531 --> 01:06:10,867
for the holders
of capital assets.
1405
01:06:10,867 --> 01:06:13,603
And that can't go on forever.
1406
01:06:13,603 --> 01:06:16,373
(cheerful music)
1407
01:06:22,246 --> 01:06:24,314
- Even though every
politician says,
1408
01:06:24,314 --> 01:06:27,084
"This is the most important
election in your lifetime."
1409
01:06:27,984 --> 01:06:33,090
These forces aren't tamed or
unleashed by a single election.
1410
01:06:33,823 --> 01:06:36,393
(audience cheering)
1411
01:06:37,494 --> 01:06:39,396
- In the news in the
last couple of weeks,
1412
01:06:39,396 --> 01:06:41,765
we've read about
the coronavirus.
1413
01:06:41,765 --> 01:06:43,267
And dude, China's acting like
1414
01:06:43,267 --> 01:06:45,169
this is (scoffs) like
zombie apocalypse.
1415
01:06:45,169 --> 01:06:46,570
- I'm actually kind
of afraid of that
1416
01:06:46,570 --> 01:06:48,138
corona virus, man.
- Yeah. No, I don't wanna get
1417
01:06:48,138 --> 01:06:49,406
on a plane.
1418
01:06:49,406 --> 01:06:51,007
Do we have a government
that's competent enough
1419
01:06:51,007 --> 01:06:54,111
and organized enough to
handle that kind of response?
1420
01:06:54,111 --> 01:06:56,080
- No, man. I mean,
we can't even handle
1421
01:06:56,080 --> 01:06:58,415
like homelessness
in the city of LA.
1422
01:06:58,415 --> 01:06:59,949
You know what I mean?
1423
01:06:59,949 --> 01:07:02,452
Like we can't even figure out
how to properly fund anything,
1424
01:07:02,452 --> 01:07:04,321
let alone a pandemic.
1425
01:07:04,321 --> 01:07:06,990
(gentle music)
1426
01:07:08,692 --> 01:07:10,527
- Americans live
under the illusion
1427
01:07:10,527 --> 01:07:12,696
that they're incredibly
different from other people.
1428
01:07:12,696 --> 01:07:15,665
When I was in college
just everything started
1429
01:07:15,665 --> 01:07:17,667
to melt down in the Balkans,
1430
01:07:17,667 --> 01:07:20,437
everyone's like, "These
people are savages.
1431
01:07:20,437 --> 01:07:23,140
"They've been fighting each
other for hundreds-of-years."
1432
01:07:23,140 --> 01:07:26,710
It's like they just came down
out of the trees or something.
1433
01:07:26,710 --> 01:07:29,546
Then you're there
and you realize
1434
01:07:29,546 --> 01:07:32,549
these people live in houses
that have electricity
1435
01:07:32,549 --> 01:07:34,651
and two-car garages
and refrigerators
1436
01:07:34,651 --> 01:07:36,653
and not only
children in college,
1437
01:07:36,653 --> 01:07:39,323
but several generations that
have gone through college
1438
01:07:39,323 --> 01:07:42,659
and they all spoke
the same language.
1439
01:07:42,659 --> 01:07:45,329
(gentle music)
1440
01:07:46,496 --> 01:07:47,864
And these people
(jet engine roaring)
1441
01:07:47,864 --> 01:07:49,333
killed each other.
1442
01:07:49,333 --> 01:07:54,238
They committed genocide,
250,000 killed, rape camps,
1443
01:07:54,338 --> 01:07:57,541
concentration camps,
ethnic cleansing.
1444
01:07:58,642 --> 01:08:02,579
- This was a plan to
ethnically cleanse Kosovo
1445
01:08:02,579 --> 01:08:04,748
and get rid of the
Albanian population.
1446
01:08:04,748 --> 01:08:06,350
Are we going to stand for that?
1447
01:08:06,350 --> 01:08:09,753
Is France going to stand
for that? I don't think so.
1448
01:08:09,753 --> 01:08:11,020
- [Interviewer]
Like many countries
1449
01:08:11,020 --> 01:08:13,690
as a system starts
to break down the,
1450
01:08:13,690 --> 01:08:16,260
in their case, it was
the communist system,
1451
01:08:16,260 --> 01:08:18,495
and in our case, our
capitalist system
1452
01:08:18,495 --> 01:08:20,197
is starting to break down
1453
01:08:20,197 --> 01:08:24,934
and people turn on each other
because some leaders think
1454
01:08:24,934 --> 01:08:28,837
"Everybody's upset right now
and I can motivate my group
1455
01:08:28,837 --> 01:08:30,540
"to take stuff from
another group."
1456
01:08:30,540 --> 01:08:32,276
- [Narrator] Europe has
not seen displaced people
1457
01:08:32,276 --> 01:08:35,612
in these numbers since
the Second World War.
1458
01:08:35,612 --> 01:08:38,047
- And those are the kinds of
things we have to worry about
1459
01:08:38,047 --> 01:08:40,950
with climate change,
because it happens when,
1460
01:08:40,950 --> 01:08:42,952
resources start to get tight,
1461
01:08:42,952 --> 01:08:46,423
and everybody's a
human, everybody's
prone to these things.
1462
01:08:46,423 --> 01:08:49,226
- We've pre-cut boards that
we can put over the windows
1463
01:08:49,226 --> 01:08:51,395
in the event that there are
looters and things like that
1464
01:08:51,395 --> 01:08:52,595
to protect the house.
1465
01:08:54,264 --> 01:08:55,565
Yeah. You saw what
you want right?
1466
01:08:55,565 --> 01:08:57,267
- We knew they wanted.
1467
01:08:57,267 --> 01:09:02,806
- The UN said just two weeks
ago, a billion within 30 years.
1468
01:09:02,806 --> 01:09:05,541
- Okay. A billion displaced
people, a billion refugees
1469
01:09:05,541 --> 01:09:06,943
because they can't grow their
food the way they used to
1470
01:09:06,943 --> 01:09:09,313
because of the drought
or because of floods
1471
01:09:09,313 --> 01:09:11,815
or because of
collapse of systems.
1472
01:09:11,815 --> 01:09:13,217
- [Reporter] How much
worse is this gonna get
1473
01:09:13,217 --> 01:09:14,318
before it gets better?
1474
01:09:15,885 --> 01:09:17,220
- I think the general view
1475
01:09:17,220 --> 01:09:19,789
is this is going to
continue deteriorating
1476
01:09:19,789 --> 01:09:21,825
for the time being,
1477
01:09:21,825 --> 01:09:24,093
the next rains are
a long while off.
1478
01:09:24,093 --> 01:09:26,330
- For the world, this
is a very bad thing
1479
01:09:26,330 --> 01:09:29,833
because it's billions
of people dislocated,
1480
01:09:29,833 --> 01:09:32,469
massive economic consequences.
1481
01:09:32,469 --> 01:09:34,638
(fireworks cracking)
1482
01:09:34,638 --> 01:09:37,474
- Can you have a
society that's been
1483
01:09:37,474 --> 01:09:40,644
as successful as this one
has in a material sense?
1484
01:09:40,644 --> 01:09:42,345
And can it transform itself?
1485
01:09:42,345 --> 01:09:45,315
You know, in the past empires
haven't been able to do that.
1486
01:09:45,915 --> 01:09:47,851
What would these Romans say?
1487
01:09:49,253 --> 01:09:50,586
Could they help us?
1488
01:09:51,521 --> 01:09:52,656
- [Wes Jr.] Unlikely.
1489
01:09:52,656 --> 01:09:53,690
- [Wesley] Unlikely.
1490
01:09:53,690 --> 01:09:55,124
(gentle music)
1491
01:09:55,191 --> 01:09:58,127
The heritage of
America is Roman.
1492
01:09:58,127 --> 01:10:00,764
All the men who wrote their
constitution had studied
1493
01:10:00,764 --> 01:10:02,866
the history of Rome,
1494
01:10:02,866 --> 01:10:05,635
I mean, the Senate it's Roman.
1495
01:10:05,635 --> 01:10:08,371
- And it's failing us just
like the Roman Senate failed.
1496
01:10:08,371 --> 01:10:11,207
- You know, there was a
Greek philosopher who said
1497
01:10:11,808 --> 01:10:14,644
that governments
go through cycles.
1498
01:10:14,644 --> 01:10:18,482
They go from a
democracy to oligopoly
1499
01:10:18,548 --> 01:10:23,719
to dictatorships
and they collapse.
1500
01:10:23,719 --> 01:10:26,856
- I know we're talking
about Aristotle but..
1501
01:10:26,856 --> 01:10:29,157
- Actually it wasn't Aristotle,
it was a different guy.
1502
01:10:29,157 --> 01:10:30,559
- No, it was Aristotle.
1503
01:10:30,559 --> 01:10:32,896
- No, it was maybe
it was Polybius,
1504
01:10:32,896 --> 01:10:34,063
I forget who it was.
1505
01:10:34,063 --> 01:10:37,233
- I'll bet you cash,
it's Aristotle.
1506
01:10:37,233 --> 01:10:39,869
'cause we're in Vegas, I will
bet you cash it's Aristotle,
1507
01:10:39,869 --> 01:10:42,906
because Aristotle came
up with the definitions
1508
01:10:42,906 --> 01:10:44,841
of the three kinds
of governments
1509
01:10:44,841 --> 01:10:46,743
and their alter egos.
1510
01:10:46,743 --> 01:10:49,813
So you have a democracy
which when it goes bad,
1511
01:10:49,813 --> 01:10:51,315
becomes a mobocracy.
1512
01:10:52,416 --> 01:10:54,651
You have a monarchy,
1513
01:10:54,651 --> 01:10:57,687
which when it goes
bad becomes a tyranny
1514
01:10:57,687 --> 01:10:59,988
and you have an aristocracy,
1515
01:10:59,988 --> 01:11:02,658
which when it goes bad
becomes an oligopoly.
1516
01:11:06,530 --> 01:11:10,500
- He's building on the
work of a predecessor.
1517
01:11:10,500 --> 01:11:12,035
What's the name of
the predecessor?
1518
01:11:12,035 --> 01:11:13,937
We have to find that out.
1519
01:11:13,937 --> 01:11:15,171
- [Wes Jr.] I don't
know, you tell me.
1520
01:11:15,171 --> 01:11:16,340
- [Wesley] We'll find it.
1521
01:11:16,340 --> 01:11:17,841
I don't know, I
have to look it up.
1522
01:11:17,841 --> 01:11:20,610
- [Narrator] Wealth was
obtained largely through trade,
1523
01:11:21,878 --> 01:11:23,680
into the warehouses
full of goods
1524
01:11:23,680 --> 01:11:26,115
from all over the
empire and beyond.
1525
01:11:26,850 --> 01:11:29,419
It was the wealthy few
rather than the many,
1526
01:11:29,419 --> 01:11:31,120
who benefited from the riches
1527
01:11:31,120 --> 01:11:33,221
and vast resources
of the empire.
1528
01:11:34,458 --> 01:11:37,361
This imbalance and the
irresponsible behavior
1529
01:11:37,361 --> 01:11:38,962
of public officials,
1530
01:11:38,962 --> 01:11:42,398
would become major reasons
for Rome's eventual decline.
1531
01:11:45,402 --> 01:11:47,537
- Okay, so dad
and I had this bet
1532
01:11:47,537 --> 01:11:49,473
and I need you to
see if I'm right
1533
01:11:49,473 --> 01:11:50,974
or he's right.
- Okay.
1534
01:11:51,875 --> 01:11:53,276
- It's about Aristotle.
1535
01:11:53,276 --> 01:11:54,811
- Oh boy.
1536
01:11:54,811 --> 01:11:55,745
- I know, I know.
1537
01:11:55,745 --> 01:11:57,046
(laughing)
1538
01:11:57,046 --> 01:12:00,484
So I was like well,
Aristotle described,
1539
01:12:00,484 --> 01:12:02,486
the death of democracy
and what happens
1540
01:12:02,486 --> 01:12:05,121
to different forms of
government as they decay.
1541
01:12:06,322 --> 01:12:08,958
(gentle music)
1542
01:12:12,429 --> 01:12:16,833
(speaking in a foreign language)
1543
01:13:06,049 --> 01:13:10,219
- Well you see Alessia, I know
from also from your studies,
1544
01:13:10,219 --> 01:13:12,989
that the collapse
of the Roman Empire
1545
01:13:12,989 --> 01:13:17,293
was mainly a huge, gigantic,
1546
01:13:17,293 --> 01:13:21,498
enormous, humongous,
financial collapse.
1547
01:13:21,498 --> 01:13:25,902
At some point, the emperors
had just run out of money.
1548
01:13:27,671 --> 01:13:30,005
- There are lots of
different theories
1549
01:13:30,005 --> 01:13:32,208
why the Roman
Empire did collapse.
1550
01:13:32,208 --> 01:13:33,510
I think what we know now,
1551
01:13:33,510 --> 01:13:36,513
is that there has been
a long economic decline
1552
01:13:36,513 --> 01:13:37,981
before the Roman
Empire collapsed,
1553
01:13:37,981 --> 01:13:40,650
before the German
hoards came down
1554
01:13:40,650 --> 01:13:42,752
and conquered Italy,
1555
01:13:42,752 --> 01:13:44,353
and conquered Rome,
ultimately, right?
1556
01:13:44,353 --> 01:13:48,758
So the question is
what triggered the
long economic decline?
1557
01:13:48,758 --> 01:13:52,261
- Disparity between
the rich and the poor.
1558
01:13:52,261 --> 01:13:54,931
- Onistorus and Miliorus they...
1559
01:13:54,931 --> 01:13:56,264
- Yes, you're
speaking Latin now.
1560
01:13:56,264 --> 01:13:57,567
- Yeah, yeah Latin.
1561
01:13:58,602 --> 01:14:00,603
- Massive amounts of inequality
1562
01:14:00,603 --> 01:14:02,939
may not be politically
sustainable.
1563
01:14:04,207 --> 01:14:07,443
Governments fund themselves
through either debt,
1564
01:14:07,443 --> 01:14:08,678
or through taxation.
1565
01:14:08,678 --> 01:14:10,179
In Rome you would basically go
1566
01:14:10,179 --> 01:14:13,683
and try to squeeze
more returns out of
1567
01:14:13,683 --> 01:14:15,118
provinces that you occupied,
1568
01:14:15,118 --> 01:14:18,054
or you might launch another
war to get the returns,
1569
01:14:18,054 --> 01:14:20,456
to feed Rome and
feed those who were
1570
01:14:20,456 --> 01:14:22,125
running the system overall.
1571
01:14:23,527 --> 01:14:25,529
And I think that's
the common denominator
1572
01:14:25,529 --> 01:14:27,897
because we live in a quite
different system today, right?
1573
01:14:27,897 --> 01:14:29,566
So today it's our central banks
1574
01:14:29,566 --> 01:14:31,901
who are doing the
rescue operation.
1575
01:14:31,901 --> 01:14:33,469
- One thing about the
financial markets,
1576
01:14:33,469 --> 01:14:35,972
one of their real power is,
1577
01:14:35,972 --> 01:14:39,407
if they can pull forward
action from the future
1578
01:14:39,407 --> 01:14:41,911
to the present, if
there's credible policy,
1579
01:14:41,911 --> 01:14:44,380
after all, most of
what central banks do
1580
01:14:44,380 --> 01:14:45,949
is effectively that.
1581
01:14:46,916 --> 01:14:48,885
- So big trees fall hard.
1582
01:14:48,885 --> 01:14:51,154
The market can
adapt to anything,
1583
01:14:51,154 --> 01:14:52,656
as long as there's clarity,
1584
01:14:52,656 --> 01:14:55,124
transparency and honesty
1585
01:14:55,124 --> 01:14:58,562
and I don't think
we're getting that.
1586
01:14:58,827 --> 01:15:01,164
- There were a lot of things
that caused the problem,
1587
01:15:01,164 --> 01:15:04,968
but, I mean, essentially,
1588
01:15:04,968 --> 01:15:06,434
the structure of Rome
1589
01:15:06,434 --> 01:15:08,838
held together for
a good long time,
1590
01:15:08,838 --> 01:15:11,007
until finally it just ran out
1591
01:15:11,007 --> 01:15:15,745
of economic wherewithal
and leadership.
1592
01:15:15,745 --> 01:15:17,581
- Politicians were bought,
1593
01:15:17,581 --> 01:15:20,617
what the founders of
our republic warned us
1594
01:15:20,617 --> 01:15:23,286
about over and over that
if you get really wealthy
1595
01:15:23,286 --> 01:15:26,022
and you lose your moral
character, it's over.
1596
01:15:26,022 --> 01:15:27,757
- Well, that's where we are.
1597
01:15:27,757 --> 01:15:30,526
- Because we are very
close to a moment
1598
01:15:30,526 --> 01:15:35,531
in which we could
start slowly going down
1599
01:15:35,531 --> 01:15:37,867
and if we are not very careful,
1600
01:15:37,867 --> 01:15:40,804
we will go down faster and
faster and faster and faster.
1601
01:15:40,804 --> 01:15:42,105
(exclaiming)
1602
01:15:42,105 --> 01:15:43,306
Roller coaster.
1603
01:15:43,306 --> 01:15:45,508
It will be a lot of fun, maybe.
1604
01:15:46,142 --> 01:15:48,544
You know the
ancient malediction,
1605
01:15:48,544 --> 01:15:52,380
may you live in
interesting times.
1606
01:15:52,380 --> 01:15:54,718
(loud bang)
1607
01:15:55,719 --> 01:15:59,723
- So, that's how
it ended last time.
1608
01:16:02,726 --> 01:16:04,728
Except this time, it
won't just be barbarians,
1609
01:16:04,728 --> 01:16:06,963
it'll be the planet
itself that's on fire.
1610
01:16:06,963 --> 01:16:09,565
(fire roaring)
1611
01:16:11,668 --> 01:16:13,568
- [Man] There's still
active fire in that area.
1612
01:16:13,568 --> 01:16:16,472
Monitor the conditions
and know what you'll do
1613
01:16:16,472 --> 01:16:18,907
if the fire threatens
(indistinct)
1614
01:16:18,907 --> 01:16:21,377
- [Woman] In the smoky
aftermath of the worst start
1615
01:16:21,377 --> 01:16:23,746
to fire season
anyone can remember,
1616
01:16:23,746 --> 01:16:25,648
while some search for solutions,
1617
01:16:25,648 --> 01:16:27,583
others want someone to blame.
1618
01:16:27,583 --> 01:16:29,753
(gentle somber music)
1619
01:16:29,753 --> 01:16:31,587
- Probably should take a
break and let it settle in,
1620
01:16:31,587 --> 01:16:32,656
take an intermission.
1621
01:16:35,725 --> 01:16:39,028
- Financial ingenuity has
been part of this system
1622
01:16:39,028 --> 01:16:41,097
since the Dutch invented the...
1623
01:16:41,097 --> 01:16:42,365
- Okay,
1624
01:16:42,365 --> 01:16:43,599
- But a lot of it
- liability company
1625
01:16:43,599 --> 01:16:45,534
- isn't financial
- and Lloyds of London.
1626
01:16:45,534 --> 01:16:46,568
But dad, listen.
1627
01:16:46,568 --> 01:16:48,004
- People get pretty...
1628
01:16:48,004 --> 01:16:49,505
- Everybody thought Bernie
Madoff was a genius.
1629
01:16:49,505 --> 01:16:50,707
- Yeah.
1630
01:16:50,707 --> 01:16:52,942
Foreign investors looked
at the United States
1631
01:16:52,942 --> 01:16:57,013
and said, "the United
States they're the best.
1632
01:16:57,013 --> 01:16:59,916
"That's the safest place in
the world I can put my money".
1633
01:17:01,017 --> 01:17:02,218
- [Woman] I mean, we've
had, I don't know,
1634
01:17:02,218 --> 01:17:04,452
five, six biblical-like events.
1635
01:17:04,452 --> 01:17:05,789
We're continuing to have them,
1636
01:17:05,789 --> 01:17:10,794
so I need to
question the validity
1637
01:17:11,460 --> 01:17:15,464
of the value of, and viability
1638
01:17:15,464 --> 01:17:17,266
of my land long-term.
1639
01:17:17,266 --> 01:17:19,803
(upbeat music)
1640
01:17:23,807 --> 01:17:25,742
- A little over seven years ago,
1641
01:17:25,742 --> 01:17:28,044
Hurricane Sandy
blew through here,
1642
01:17:28,044 --> 01:17:31,815
causing tens of billions of
dollars in property damage,
1643
01:17:31,815 --> 01:17:36,820
and since then, New
York has built more,
1644
01:17:36,820 --> 01:17:42,925
bigger, taller and
more expensive,
because we, the people,
1645
01:17:42,992 --> 01:17:47,496
are on the hook for the
cost of the insurance
1646
01:17:47,496 --> 01:17:50,566
if another hurricane comes
and hits New York City.
1647
01:17:50,566 --> 01:17:53,136
(rain pouring)
1648
01:17:54,503 --> 01:17:57,173
(metal banging)
1649
01:17:58,441 --> 01:18:00,409
The National Flood
Insurance Program
1650
01:18:00,409 --> 01:18:04,580
is a federally-run public
program of insurance.
1651
01:18:04,580 --> 01:18:07,984
It's run by the Federal
Emergency Management Agency.
1652
01:18:10,987 --> 01:18:13,456
It provides flood insurance
for virtually all homeowners
1653
01:18:13,456 --> 01:18:15,523
and small businesses
in the country.
1654
01:18:15,523 --> 01:18:17,193
So this is pretty
unusual, actually.
1655
01:18:17,193 --> 01:18:19,128
Most other countries
have private markets
1656
01:18:19,128 --> 01:18:21,697
for flood insurance,
but the U.S does not.
1657
01:18:21,697 --> 01:18:24,100
(sirens blaring)
1658
01:18:24,100 --> 01:18:27,436
- It's a supplementary
policy that is subsidized
1659
01:18:27,436 --> 01:18:32,441
by the government, and so all
citizens are, to some extent,
1660
01:18:32,441 --> 01:18:36,045
footing the bill for
coastal property owners.
1661
01:18:38,647 --> 01:18:41,851
- In order to build a huge
condominium development
1662
01:18:41,851 --> 01:18:43,787
in a flood plain in New
York City, you, of course,
1663
01:18:43,787 --> 01:18:44,954
need a lot of capital.
1664
01:18:45,889 --> 01:18:48,724
Municipal actors in New York
City are very interested
1665
01:18:48,724 --> 01:18:53,029
in continuing to promote a
version of New York City,
1666
01:18:53,029 --> 01:18:57,633
in which as much of the
available land remains viable
1667
01:18:57,633 --> 01:18:59,168
for continued
economic development,
1668
01:18:59,168 --> 01:19:03,005
because property taxes are so
important there, as elsewhere.
1669
01:19:06,409 --> 01:19:08,311
- Well, the original program
1670
01:19:08,311 --> 01:19:09,913
of the National Flood
Insurance Program
1671
01:19:09,913 --> 01:19:13,549
was supposed to stop
construction in very
high risk areas.
1672
01:19:13,582 --> 01:19:15,718
Areas where water
moves with velocity,
1673
01:19:15,718 --> 01:19:17,987
particularly flood
ways along the river,
1674
01:19:17,987 --> 01:19:21,023
where water moves the
same rate as the river,
1675
01:19:21,023 --> 01:19:24,593
hurricane-zoned areas, where
the storm surge comes in.
1676
01:19:24,593 --> 01:19:26,594
The building is,
1677
01:19:26,594 --> 01:19:29,532
it's almost impossible to
build a really safe building
1678
01:19:29,532 --> 01:19:32,735
against a 14-foot wall
of water coming in at you
1679
01:19:32,735 --> 01:19:34,403
in a storm surge.
1680
01:19:35,939 --> 01:19:38,441
There's a lot of vested
interests that don't care,
1681
01:19:38,441 --> 01:19:41,244
construction
industry, for example.
1682
01:19:41,244 --> 01:19:45,748
They'd like to build
a house on a beach
1683
01:19:45,748 --> 01:19:47,851
while the tide is out, as
long as they can sell it
1684
01:19:47,851 --> 01:19:49,853
before the tide comes back in.
1685
01:19:49,853 --> 01:19:52,588
(water flapping)
1686
01:19:54,190 --> 01:19:55,791
And once they've
sold it, of course,
1687
01:19:55,791 --> 01:19:57,693
the risk is now somebody else's.
1688
01:19:58,561 --> 01:20:02,465
- The ways in which financial
actors securitized mortgages
1689
01:20:02,465 --> 01:20:06,702
in the run-up to the
last financial crisis
1690
01:20:06,702 --> 01:20:07,937
is still going on.
1691
01:20:07,937 --> 01:20:09,772
- So the building
contractors all want
1692
01:20:09,772 --> 01:20:12,441
to minimize the flood program.
1693
01:20:12,441 --> 01:20:14,443
The town wants to minimize it,
1694
01:20:14,443 --> 01:20:16,980
wanna hold down the
elevations on the maps
1695
01:20:16,980 --> 01:20:19,148
and fight that every
map that comes out
1696
01:20:19,148 --> 01:20:20,782
by the National Flood
Insurance Program,
1697
01:20:20,782 --> 01:20:24,553
that causes problems,
delay in implementation,
1698
01:20:24,553 --> 01:20:26,255
maybe never implementation.
1699
01:20:27,456 --> 01:20:28,958
- The coastal communities
1700
01:20:28,958 --> 01:20:31,995
are on some of the most
valuable land in the country,
1701
01:20:31,995 --> 01:20:34,964
And as a consequence,
people are gonna fight
1702
01:20:34,964 --> 01:20:38,501
to protect their
investment position.
1703
01:20:39,434 --> 01:20:41,971
- I thought, okay, the
city's not requiring me
1704
01:20:41,971 --> 01:20:44,139
to have flood insurance.
1705
01:20:44,139 --> 01:20:47,343
My realtor didn't tell me I
had to have flood insurance.
1706
01:20:47,343 --> 01:20:49,645
- Honestly, you don't
look at the flood maps
1707
01:20:49,645 --> 01:20:51,580
when you move into
a neighborhood.
1708
01:20:51,580 --> 01:20:55,351
You fall in love with the
house, and 85% of the people
1709
01:20:55,351 --> 01:20:57,186
in my neighborhood
were not insured.
1710
01:20:57,186 --> 01:20:58,922
- [Narrator] Shelter.
1711
01:20:58,922 --> 01:21:01,958
- The United States
is uniquely vulnerable
1712
01:21:01,958 --> 01:21:06,462
to building into
disaster-likely,
1713
01:21:06,462 --> 01:21:10,666
physically vulnerable areas,
because of our reliance
1714
01:21:10,666 --> 01:21:15,138
on local rule, particularly
for zoning decisions.
1715
01:21:15,138 --> 01:21:18,707
That's part of our bedrock
of the United States,
1716
01:21:18,707 --> 01:21:20,809
state rights and local rights,
1717
01:21:20,809 --> 01:21:23,812
and it's actually has
a lot of advantages,
1718
01:21:23,812 --> 01:21:25,982
but it has a major disadvantage,
1719
01:21:25,982 --> 01:21:30,886
which is that local
governments depend on revenues
1720
01:21:30,886 --> 01:21:34,157
that are coming from their
buildings, from their residents
1721
01:21:34,157 --> 01:21:37,994
who are building and
living in their localities,
1722
01:21:37,994 --> 01:21:42,966
and that means that
all residents benefit
from development.
1723
01:21:46,802 --> 01:21:51,040
- The politics of provision
are so tied up with land values
1724
01:21:51,040 --> 01:21:54,243
in the United States, that
if property values go down,
1725
01:21:54,243 --> 01:21:57,913
then the tax assessments
adjust to reflect that,
1726
01:21:57,913 --> 01:22:00,183
and you're bringing in less
revenue for the tax base,
1727
01:22:00,183 --> 01:22:03,052
which means less investment
in local amenities
1728
01:22:03,052 --> 01:22:06,189
and schools and local
public transportation.
1729
01:22:08,857 --> 01:22:13,329
- In Texas, we don't
have state income tax.
1730
01:22:14,362 --> 01:22:15,931
That's another reason
why you wanna live here,
1731
01:22:15,931 --> 01:22:18,867
because it's cheap, but people
are taxed on their land.
1732
01:22:21,170 --> 01:22:24,707
- The maps that are in
existence for where a 100
1733
01:22:24,707 --> 01:22:27,943
or 500-year flood will
happen are so outdated
1734
01:22:27,943 --> 01:22:32,248
and no longer accurate, the
risk and the cost of that risk,
1735
01:22:32,248 --> 01:22:36,952
even within the insurance
industry, is not as accurate
1736
01:22:36,952 --> 01:22:39,555
as it needs to be, in
order for us to appreciate
1737
01:22:39,555 --> 01:22:40,956
what the cost of climate is.
1738
01:22:42,391 --> 01:22:45,394
- Insurance actors
have found ways
1739
01:22:45,394 --> 01:22:48,964
to take an insurance
policy and securitize that,
1740
01:22:48,964 --> 01:22:50,966
and transfer it to kind
of capital risk markets,
1741
01:22:50,966 --> 01:22:53,102
so they're not really
holding the bag,
1742
01:22:53,102 --> 01:22:55,804
which means that they're
willing to underwrite more
1743
01:22:55,804 --> 01:22:57,306
and more property,
1744
01:22:57,306 --> 01:22:59,308
which means that people
can kinda continue to build
1745
01:22:59,308 --> 01:23:00,576
in risky areas.
1746
01:23:01,544 --> 01:23:04,147
- I don't think anyone
would wanna come in
1747
01:23:04,147 --> 01:23:07,483
and look at the house and
come through salt water
1748
01:23:07,483 --> 01:23:09,818
and wanna buy it.
1749
01:23:09,818 --> 01:23:12,921
(water splashing)
1750
01:23:12,921 --> 01:23:14,723
- This is my nest egg.
- Yeah, this is your nest egg.
1751
01:23:14,723 --> 01:23:16,791
- This is how I'm gonna help
my kids and my retirement.
1752
01:23:16,791 --> 01:23:19,327
- But now, because you
bought it in an area
1753
01:23:19,327 --> 01:23:21,496
where there's rising sea level,
1754
01:23:21,496 --> 01:23:23,732
maybe that nest
egg's not so secure.
1755
01:23:23,732 --> 01:23:28,003
In order to convert
his nest egg to cash,
1756
01:23:28,003 --> 01:23:31,074
he's gotta be able
to sell the house,
1757
01:23:31,074 --> 01:23:35,344
but now nobody will insure
the next 30 year mortgage.
1758
01:23:35,344 --> 01:23:37,346
What happens to John?
1759
01:23:37,346 --> 01:23:39,282
- [Wesley] John's lost
his retirement nest egg.
1760
01:23:39,282 --> 01:23:44,019
- Okay, so John is now
literally John on the street.
1761
01:23:44,853 --> 01:23:48,991
- [Wesley] The nice house
that we're gonna buy
1762
01:23:48,991 --> 01:23:50,659
in Florida to retire...
1763
01:23:51,427 --> 01:23:53,129
- This was their
house in Florida.
1764
01:23:53,129 --> 01:23:54,530
They were gonna move to Alabama.
1765
01:23:54,530 --> 01:23:56,799
- [Wesley] Okay, well,
they're not moving.
1766
01:23:56,799 --> 01:23:58,666
They may still move to Alabama.
1767
01:23:58,666 --> 01:24:00,469
They may be living
in a trailer park.
1768
01:24:02,371 --> 01:24:03,871
- Flood involves
the U.S government
1769
01:24:03,871 --> 01:24:05,474
in this really peculiar way,
1770
01:24:05,474 --> 01:24:09,212
fire is privately underwritten,
1771
01:24:09,212 --> 01:24:10,978
so it's private insurers
1772
01:24:10,978 --> 01:24:15,550
and what's happening
with fire risk,
1773
01:24:15,550 --> 01:24:17,820
is that some of the
primary insurers
1774
01:24:17,820 --> 01:24:19,054
are going out of business,
1775
01:24:19,054 --> 01:24:20,723
in events like the
California wildfires,
1776
01:24:20,723 --> 01:24:22,125
that can put an insurer
out of business,
1777
01:24:22,125 --> 01:24:24,727
if they have
outstanding liabilities
1778
01:24:24,727 --> 01:24:26,662
that exceed what
they can pay off.
1779
01:24:29,465 --> 01:24:30,866
- [Wes Jr.] Then
we started talking
1780
01:24:30,866 --> 01:24:33,469
and you told me
about buying a house
1781
01:24:33,469 --> 01:24:34,837
in Sausalito.
1782
01:24:34,837 --> 01:24:36,139
So what happened?
1783
01:24:36,139 --> 01:24:37,873
- So we call the insurance
company two days before,
1784
01:24:37,873 --> 01:24:39,375
two or three days before
1785
01:24:39,375 --> 01:24:40,743
and let them know we're
gonna close in a few days.
1786
01:24:40,743 --> 01:24:42,010
And they call us back and say,
1787
01:24:42,010 --> 01:24:43,212
" Hey, we can't
insure that house"
1788
01:24:43,212 --> 01:24:44,680
And I'm like, "what?"
1789
01:24:44,680 --> 01:24:47,316
And they're like " yeah, it's
on a list of neighborhoods
1790
01:24:47,316 --> 01:24:48,717
"that we don't insure anymore"
1791
01:24:48,717 --> 01:24:51,987
So these entire neighborhoods
are gonna be uninsured
1792
01:24:51,987 --> 01:24:53,189
and they also told us,
1793
01:24:53,189 --> 01:24:55,090
they don't know if
they're gonna reinsure
1794
01:24:55,090 --> 01:24:57,059
the current owner
of the house either.
1795
01:24:57,059 --> 01:24:58,894
That's an entire,
1796
01:24:58,894 --> 01:25:02,264
billions of dollars of
houses across the state,
1797
01:25:02,264 --> 01:25:04,400
that it's gonna have
an insurance problem.
1798
01:25:05,568 --> 01:25:09,205
(jet engine roaring)
1799
01:25:09,205 --> 01:25:12,441
- The insurance companies
are insuring for one year.
1800
01:25:12,441 --> 01:25:14,743
So as things get worse,
the insurance companies
1801
01:25:14,743 --> 01:25:17,112
are definitely not
going to be able
1802
01:25:17,112 --> 01:25:19,448
to come to the rescue
of these homeowners.
1803
01:25:20,616 --> 01:25:23,386
- These latent,
hidden climate risks
1804
01:25:23,386 --> 01:25:26,621
that might exist in
different places,
1805
01:25:26,621 --> 01:25:28,191
in different housing markets,
1806
01:25:28,191 --> 01:25:30,459
should they burst,
could take down
1807
01:25:30,459 --> 01:25:32,127
the entire financial system.
1808
01:25:33,962 --> 01:25:38,901
- And right now this house
is listed for $49,000.
1809
01:25:38,901 --> 01:25:42,737
At the peak of the market,
it went to about $250,000.
1810
01:25:43,871 --> 01:25:46,242
- It's not only the owners
that lose their assets,
1811
01:25:46,242 --> 01:25:48,076
it's the financial
intermediaries that lose
1812
01:25:48,076 --> 01:25:49,645
their claims against them.
1813
01:25:49,645 --> 01:25:52,047
It's those that bought
the secularized mortgages
1814
01:25:52,047 --> 01:25:54,583
and other assets that
are linked to them,
1815
01:25:54,583 --> 01:25:57,820
just as we've seen
in the 2008 crisis.
1816
01:25:57,820 --> 01:26:00,323
- And unless we're prepared
to continue to write
1817
01:26:00,323 --> 01:26:02,391
the same check over
and over again,
1818
01:26:02,391 --> 01:26:04,393
we need to start to scrutinize,
1819
01:26:05,160 --> 01:26:10,833
are we hardening the utilities
and the infrastructure
1820
01:26:10,833 --> 01:26:13,168
around these homes sufficiently,
1821
01:26:13,168 --> 01:26:16,103
so they can weather these
storms going forward?
1822
01:26:16,103 --> 01:26:18,841
Or should we in fact not permit
1823
01:26:18,841 --> 01:26:23,346
the investment of capital,
that is going to be subject to,
1824
01:26:24,680 --> 01:26:28,251
climate change conditions
in a negative way
1825
01:26:28,251 --> 01:26:29,752
and we need to think about that.
1826
01:26:29,752 --> 01:26:32,521
- No, that's the
really scary thing
1827
01:26:32,521 --> 01:26:35,458
because we're not, you
know we're not hardening
1828
01:26:35,458 --> 01:26:37,125
any of our infrastructure.
1829
01:26:37,125 --> 01:26:37,960
(laughing)
1830
01:26:37,960 --> 01:26:39,027
I mean, not yet.
1831
01:26:39,027 --> 01:26:39,962
It's very expensive.
1832
01:26:39,962 --> 01:26:40,862
There's guys thinking about it,
1833
01:26:40,862 --> 01:26:42,630
but nobody's done it yet.
1834
01:26:42,630 --> 01:26:45,032
(train approaching)
1835
01:26:45,032 --> 01:26:47,335
- Well, from an oil
company standpoint,
1836
01:26:48,202 --> 01:26:51,507
most of the major assets
in the United States
1837
01:26:51,507 --> 01:26:54,610
and actually globally,
are on the coastline.
1838
01:26:57,212 --> 01:27:01,116
From that standpoint, the
facilities are as vulnerable
1839
01:27:01,116 --> 01:27:03,018
as people's homes.
1840
01:27:03,018 --> 01:27:05,288
So there's a lot of
offshore infrastructure
1841
01:27:05,288 --> 01:27:06,989
in the Gulf of Mexico,
1842
01:27:06,989 --> 01:27:10,293
but that comes on shore
to a lot of pipelines
1843
01:27:10,293 --> 01:27:12,695
that are right at the coastline.
1844
01:27:12,695 --> 01:27:15,230
And so as the coastline erodes,
1845
01:27:15,230 --> 01:27:18,567
those pipelines become
noticeable and vulnerable
1846
01:27:18,567 --> 01:27:22,871
and have to be buried deeper,
1847
01:27:22,871 --> 01:27:26,074
or infrastructure put
around it to protect it.
1848
01:27:26,809 --> 01:27:30,178
So indeed, yeah, hardening
of infrastructure,
1849
01:27:30,178 --> 01:27:34,416
utilities and fires have
been associated with that,
1850
01:27:34,416 --> 01:27:36,419
or the pipelines.
1851
01:27:36,419 --> 01:27:40,055
People are worried about how
to protect those going forward.
1852
01:27:40,923 --> 01:27:44,827
- Nature's gonna be
eroding the foundations
1853
01:27:44,827 --> 01:27:46,094
of our economy.
1854
01:27:46,094 --> 01:27:48,764
(waves roaring)
1855
01:27:53,436 --> 01:27:57,072
- So, sometimes I'm out
in a place like this,
1856
01:27:58,040 --> 01:28:00,609
and I imagine what it
would be like to come here
1857
01:28:00,609 --> 01:28:03,077
with no money in my pocket,
1858
01:28:04,347 --> 01:28:07,782
fleeing an economic meltdown,
1859
01:28:07,782 --> 01:28:10,218
'cause you know look, we
do have plenty of land,
1860
01:28:11,920 --> 01:28:14,357
but if I had to survive out here
1861
01:28:14,357 --> 01:28:15,591
and didn't have the money
1862
01:28:16,859 --> 01:28:19,362
to buy something to
provide me power,
1863
01:28:20,429 --> 01:28:22,431
some way to get water,
1864
01:28:22,431 --> 01:28:23,932
out of a fairly dry land,
1865
01:28:25,133 --> 01:28:27,570
while we love pristine nature
1866
01:28:27,570 --> 01:28:29,237
and we like to hike in it,
1867
01:28:29,237 --> 01:28:32,139
hunt in it, camp in it,
1868
01:28:32,139 --> 01:28:34,410
all those things we do
1869
01:28:34,410 --> 01:28:39,081
thanks to the technology
that you bought at the store.
1870
01:28:39,081 --> 01:28:43,652
The tent, the gun,
the flashlight,
1871
01:28:43,652 --> 01:28:47,723
the lighter, these things are
made in human communities,
1872
01:28:47,723 --> 01:28:51,093
in factories, not by
people on the run,
1873
01:28:51,093 --> 01:28:52,795
not by people out of capital.
1874
01:28:54,996 --> 01:28:57,633
(gentle music)
1875
01:28:59,402 --> 01:29:00,835
It's all about capital.
1876
01:29:04,272 --> 01:29:05,841
So here's what happens,
1877
01:29:05,841 --> 01:29:08,943
capital is gonna flow to where
it can make the most money
1878
01:29:08,943 --> 01:29:10,112
for the capital owner.
1879
01:29:11,013 --> 01:29:12,246
A town like this,
1880
01:29:12,246 --> 01:29:14,650
which was a silver mining town,
1881
01:29:14,650 --> 01:29:17,952
is a good example
of foraging theory,
1882
01:29:17,952 --> 01:29:20,155
where if you're an animal or,
1883
01:29:20,689 --> 01:29:24,359
and these things translate
into the human world as well,
1884
01:29:24,359 --> 01:29:26,193
and you've got a choice
between two things,
1885
01:29:26,193 --> 01:29:27,763
one that's easy to get
1886
01:29:27,763 --> 01:29:29,197
and one that's hard to get.
1887
01:29:29,197 --> 01:29:31,834
If the easy thing to
get is worth more,
1888
01:29:31,834 --> 01:29:33,469
that's what you're gonna go for.
1889
01:29:33,469 --> 01:29:35,704
So that's what
produces boom towns,
1890
01:29:35,704 --> 01:29:39,207
because at one point the silver
was really easy to get to
1891
01:29:39,207 --> 01:29:40,375
and worth something
1892
01:29:40,375 --> 01:29:42,645
and then when the
silver market crashed,
1893
01:29:42,645 --> 01:29:44,480
well, it wasn't worth anything.
1894
01:29:44,480 --> 01:29:49,184
So they moved on, to find the
next easiest thing to mine.
1895
01:29:49,885 --> 01:29:55,123
These patterns of capital
do not change over time.
1896
01:29:55,290 --> 01:29:59,027
Capital is always gonna
seek the greatest return
1897
01:29:59,027 --> 01:30:02,197
and as soon as that
return isn't paying off,
1898
01:30:02,197 --> 01:30:05,166
it's gonna pull up stakes
and go somewhere else.
1899
01:30:05,568 --> 01:30:09,905
- The way to define
capital is the money
1900
01:30:09,905 --> 01:30:14,175
that is going to be used
to create something.
1901
01:30:14,175 --> 01:30:17,680
- People are very myopic.
1902
01:30:17,680 --> 01:30:20,883
They are just looking at
what's in front of their face
1903
01:30:20,883 --> 01:30:23,251
and the portfolio
that's right there,
1904
01:30:23,251 --> 01:30:25,688
how they're gonna make
money in the short term.
1905
01:30:32,094 --> 01:30:33,728
- How you doing Frank?
1906
01:30:33,728 --> 01:30:34,897
(laughing)
1907
01:30:34,897 --> 01:30:37,933
So look, we look
around and it's like,
1908
01:30:37,933 --> 01:30:39,201
this is all the capital,
1909
01:30:39,201 --> 01:30:40,702
this is all the
capital in the world,
1910
01:30:40,702 --> 01:30:42,103
headquartered right here.
1911
01:30:42,103 --> 01:30:43,438
- Right.
1912
01:30:43,438 --> 01:30:47,442
- And I'm assuming they
all wanna live past 2050
1913
01:30:47,442 --> 01:30:49,277
and so we gotta change over.
1914
01:30:49,277 --> 01:30:54,449
Are they beating down a
trail to your door to invest?
1915
01:30:54,449 --> 01:30:55,951
- No, they're not.
1916
01:30:55,951 --> 01:30:59,353
We have to search for the
right type of investors
1917
01:30:59,353 --> 01:31:01,223
for our projects.
1918
01:31:01,223 --> 01:31:06,028
And when we do find the
investors for our projects,
1919
01:31:06,028 --> 01:31:10,432
it's extremely difficult
to create the value
1920
01:31:10,432 --> 01:31:14,302
or pull out the value for our
projects that the investors
1921
01:31:14,302 --> 01:31:17,439
recognize immediately.
1922
01:31:17,439 --> 01:31:22,377
- If somebody can get 15% on
their money doing derivatives,
1923
01:31:22,377 --> 01:31:24,947
why would they wanna
get 5% on their money
1924
01:31:24,947 --> 01:31:27,382
doing renewable?
1925
01:31:27,382 --> 01:31:29,552
- Because they would be able
1926
01:31:29,552 --> 01:31:32,555
to use the investment
tax credit.
1927
01:31:32,555 --> 01:31:33,922
Everybody wants a return
1928
01:31:33,922 --> 01:31:36,892
and everybody wants to
maximize their return.
1929
01:31:36,892 --> 01:31:40,829
And the only groups that I
know can maximize their return
1930
01:31:40,829 --> 01:31:43,498
for renewable energy
projects today,
1931
01:31:43,498 --> 01:31:48,236
are the wealthy individuals
that have passive income.
1932
01:31:48,236 --> 01:31:50,606
- And, what do we think of
as like wealthy individuals?
1933
01:31:50,606 --> 01:31:53,842
So I think a lot of Americans
think if someone has $500,000,
1934
01:31:53,842 --> 01:31:55,077
they are a wealthy individual.
1935
01:31:55,077 --> 01:31:56,679
- I'm talking about
people who have
1936
01:31:56,679 --> 01:31:59,181
hundreds and hundreds
of millions of
dollars of net worth.
1937
01:31:59,181 --> 01:32:02,585
- So minimum, a hundred
million dollars of net worth.
1938
01:32:02,585 --> 01:32:04,952
- I would say so, but
there's not many people
1939
01:32:04,952 --> 01:32:07,755
maybe less than 1%
of the population
1940
01:32:07,755 --> 01:32:10,358
that has that type of
investment portfolio,
1941
01:32:10,358 --> 01:32:14,162
or investments generating
passive income.
1942
01:32:14,763 --> 01:32:16,298
- Any more comments?
1943
01:32:16,298 --> 01:32:18,266
- That's pretty close
all right, pretty close.
1944
01:32:18,266 --> 01:32:19,101
- Perfect.
1945
01:32:19,101 --> 01:32:20,035
- All right.
1946
01:32:20,035 --> 01:32:21,837
- So when there's not investment
1947
01:32:21,837 --> 01:32:24,873
in the market towards
the technology
1948
01:32:24,873 --> 01:32:27,943
that would help for
climate solutions,
1949
01:32:27,943 --> 01:32:30,312
and renewables and clean energy,
1950
01:32:30,312 --> 01:32:33,315
then that trickles
down into the entire,
1951
01:32:34,717 --> 01:32:38,286
the entire life
stream or life cycle,
1952
01:32:38,286 --> 01:32:41,724
you know, the whole
flow of business.
1953
01:32:41,724 --> 01:32:44,492
- Lord Keynes, who was the
founder of macro economics
1954
01:32:44,492 --> 01:32:47,162
asked the question,
why do people invest?
1955
01:32:47,162 --> 01:32:49,698
And honestly, there's no answer.
1956
01:32:49,698 --> 01:32:52,367
He called it animal spirits.
1957
01:32:54,302 --> 01:32:56,871
I can tell you people
are risk averse.
1958
01:32:56,871 --> 01:33:00,242
And after 2008, they're
even more risk averse.
1959
01:33:01,644 --> 01:33:03,545
When I go to these
business conferences
1960
01:33:03,545 --> 01:33:05,347
and I see my friends,
1961
01:33:05,347 --> 01:33:07,750
I asked the guy who's worth
a hundred million dollars,
1962
01:33:07,750 --> 01:33:09,317
I said, what are
you working on now?
1963
01:33:09,317 --> 01:33:11,253
He says, you know,
he said, I'm just,
1964
01:33:11,253 --> 01:33:13,355
I'm pretty happy where I am
1965
01:33:13,989 --> 01:33:17,525
and you know, I've got
the house in Mexico
1966
01:33:17,525 --> 01:33:19,361
and we're looking
after the grandkids,
1967
01:33:19,361 --> 01:33:22,430
and I mean, he's not
investing in taking risks.
1968
01:33:22,430 --> 01:33:24,700
He's not creating jobs
for the rest of us,
1969
01:33:24,700 --> 01:33:26,368
at least not directly.
1970
01:33:26,368 --> 01:33:28,871
That's the animal spirits
that are out there
1971
01:33:28,871 --> 01:33:31,606
in too much of the business
community right now.
1972
01:33:31,606 --> 01:33:34,442
So the only way you
can replace that
1973
01:33:34,442 --> 01:33:37,045
is with government leadership.
1974
01:33:37,045 --> 01:33:40,282
The Erie Canal, the
Transcontinental Railroad,
1975
01:33:40,282 --> 01:33:43,719
the Panama Canal,
the space program,
1976
01:33:43,719 --> 01:33:46,855
the interstate highway system,
1977
01:33:46,855 --> 01:33:50,458
in no case did a group of
entrepreneurs get together
1978
01:33:50,458 --> 01:33:53,428
and say, hey let's build the
interstate highway system.
1979
01:33:53,428 --> 01:33:57,866
No, it was a dream
that Ike pushed in 1955
1980
01:33:57,866 --> 01:33:59,702
that came from a study done
1981
01:33:59,702 --> 01:34:02,103
during World War
II that showed that
1982
01:34:02,103 --> 01:34:04,606
you needed these highways for
national security purposes.
1983
01:34:04,606 --> 01:34:06,942
- This is no partisan policy.
1984
01:34:06,942 --> 01:34:11,914
No one has a monopoly on truth,
1985
01:34:11,914 --> 01:34:14,416
and on the facts that
affect this country,
1986
01:34:14,416 --> 01:34:15,617
we must work together.
1987
01:34:17,152 --> 01:34:19,321
- The United States is
highly dis-aggregated.
1988
01:34:19,321 --> 01:34:21,889
We have 50 states, one nation,
1989
01:34:21,889 --> 01:34:23,225
many counties, many regions,
1990
01:34:23,225 --> 01:34:24,459
tens of thousands of cities
1991
01:34:24,459 --> 01:34:26,428
they all have a voice
in how things are done.
1992
01:34:26,428 --> 01:34:30,132
And it's hard to get us to
collaborate on certain projects,
1993
01:34:30,132 --> 01:34:33,068
unless we all align and
agree it's necessary
1994
01:34:33,068 --> 01:34:35,337
and we feel some
urgency to get it done.
1995
01:34:37,272 --> 01:34:39,241
- If the Australian
military study,
1996
01:34:39,241 --> 01:34:40,475
the U.S military study,
1997
01:34:40,475 --> 01:34:42,677
and the British military
study are all correct
1998
01:34:42,677 --> 01:34:44,980
we've got about 30 years
1999
01:34:44,980 --> 01:34:48,183
if we don't do anything
until civilization collapses.
2000
01:34:48,183 --> 01:34:51,286
Which I'm guessing doesn't
have a good rate of return.
2001
01:34:51,286 --> 01:34:52,187
- Correct?
2002
01:34:52,187 --> 01:34:54,089
So Wes there are actually those
2003
01:34:55,190 --> 01:34:56,591
who would tell
you that we may be
2004
01:34:56,591 --> 01:34:58,693
beyond the tipping
point already,
2005
01:34:58,693 --> 01:35:01,196
I don't subscribe
to that, by the way.
2006
01:35:01,964 --> 01:35:05,000
If you do subscribe to that then
2007
01:35:05,000 --> 01:35:07,302
it almost makes
the investment in,
2008
01:35:07,302 --> 01:35:10,806
you know wind and
solar, not pertinent.
2009
01:35:18,046 --> 01:35:20,715
- [Wesley] What's the most
valuable thing in the world?
2010
01:35:20,715 --> 01:35:22,717
The most valuable thing,
2011
01:35:22,717 --> 01:35:25,954
it's oil reserves in the ground.
2012
01:35:25,954 --> 01:35:29,023
It's worth more than the
GDP of the United States,
2013
01:35:29,023 --> 01:35:31,226
more than the stock market,
2014
01:35:31,226 --> 01:35:34,529
more than the stock markets
of all the Western countries,
2015
01:35:34,529 --> 01:35:36,398
it's oil in the ground,
2016
01:35:36,398 --> 01:35:41,403
and the people that have that
oil, they want it to be used.
2017
01:35:41,804 --> 01:35:43,839
Whatever you hear
about Saudi Arabia
2018
01:35:43,839 --> 01:35:45,240
saying they're
going to, you know
2019
01:35:45,240 --> 01:35:48,675
move beyond a petrol
based economy, yell, yell,
2020
01:35:48,675 --> 01:35:50,678
but they're going to
move at their pace
2021
01:35:50,678 --> 01:35:53,514
and they need those petro
dollars to get there.
2022
01:35:53,514 --> 01:35:57,552
The societal costs right
now are much greater
2023
01:35:57,552 --> 01:36:01,056
than the economic costs of
taking it out of the ground.
2024
01:36:01,056 --> 01:36:03,725
So you have to recognize
the societal impact
2025
01:36:03,725 --> 01:36:05,160
and you have to make the people
2026
01:36:05,160 --> 01:36:07,495
who are producing
it and selling it,
2027
01:36:07,495 --> 01:36:09,898
and the people who are buying it
2028
01:36:09,898 --> 01:36:13,668
pay the full cost of using it.
2029
01:36:13,668 --> 01:36:15,603
And that, that means a tax.
2030
01:36:15,603 --> 01:36:18,773
- But we didn't even do
that with security though,
2031
01:36:18,773 --> 01:36:20,608
because I mean, realistically
2032
01:36:20,608 --> 01:36:23,245
we've subsidized the oil
industry for 50 years
2033
01:36:23,245 --> 01:36:25,380
by knocking over governments,
2034
01:36:25,380 --> 01:36:28,550
by protecting shipping
lanes for it, oil lanes,
2035
01:36:28,550 --> 01:36:31,219
so we couldn't even do
it when it came to like
2036
01:36:32,620 --> 01:36:37,359
having them pay for their
own extraction and security.
2037
01:36:37,359 --> 01:36:38,894
- It's true.
2038
01:36:38,894 --> 01:36:41,129
But one of the reasons we
couldn't do it is because,
2039
01:36:41,129 --> 01:36:43,630
we didn't really
have the alternative.
2040
01:36:43,630 --> 01:36:45,300
- What's the sound?
2041
01:36:45,300 --> 01:36:48,136
- We didn't really have the
alternative technically.
2042
01:36:54,409 --> 01:36:57,579
(jet engine whirring)
2043
01:37:00,815 --> 01:37:03,418
(fire blazing)
2044
01:37:07,255 --> 01:37:09,124
- [Narrator 1] Engineers
worked under fire
2045
01:37:09,124 --> 01:37:11,826
to douse oil
pipelines set ablaze
2046
01:37:11,826 --> 01:37:13,428
by retreating Iraqi troops.
2047
01:37:18,733 --> 01:37:21,436
Animal fats, and tallow
could no longer supply
2048
01:37:21,436 --> 01:37:23,972
the ever growing need for
candles and lubricants.
2049
01:37:24,672 --> 01:37:27,842
Whale oil, which had long
been the chief illuminant,
2050
01:37:27,842 --> 01:37:29,511
was becoming scarce.
2051
01:37:29,511 --> 01:37:31,980
Yet the demand for artificial
light was increasing.
2052
01:37:31,980 --> 01:37:35,984
In 1850, a lamp capable
of efficiently burning
2053
01:37:35,984 --> 01:37:38,753
a refined product of
petroleum was invented.
2054
01:37:38,753 --> 01:37:39,521
- Oil!
2055
01:37:39,521 --> 01:37:43,691
- Oil!
2056
01:37:43,691 --> 01:37:45,660
- Early oil production,
they used steam power
2057
01:37:45,660 --> 01:37:47,029
for the drilling,
for the riggings
2058
01:37:47,029 --> 01:37:48,530
of different pieces
of equipment,
2059
01:37:48,530 --> 01:37:50,298
and that steam power
probably was produced
2060
01:37:50,298 --> 01:37:51,532
by burning wood or coal.
2061
01:37:51,532 --> 01:37:53,535
So you'd use wood
or coal to get oil.
2062
01:37:53,535 --> 01:37:55,202
Today, we use
electricity to get oil.
2063
01:37:55,202 --> 01:37:56,504
We use gas to get oil.
2064
01:37:56,504 --> 01:37:58,040
So we use one form of
energy to get another.
2065
01:37:58,040 --> 01:38:00,375
And that's one of the
interconnected aspects
2066
01:38:00,375 --> 01:38:02,210
of energy that's kinda
surprising for people
2067
01:38:02,210 --> 01:38:03,710
is how interdependent is.
2068
01:38:03,710 --> 01:38:06,214
We don't have an economy that
runs on one form of energy,
2069
01:38:06,214 --> 01:38:08,951
we have an economy that
runs on many forms.
2070
01:38:08,951 --> 01:38:12,387
(water splashing)
2071
01:38:12,387 --> 01:38:14,822
(soft music)
2072
01:38:22,630 --> 01:38:24,732
- Part of this equation,
2073
01:38:24,732 --> 01:38:26,001
certainly in the short term
2074
01:38:26,001 --> 01:38:28,170
to this time period
you're worried about,
2075
01:38:28,170 --> 01:38:31,339
is modulating consumption and
adjusting cultural behavior.
2076
01:38:31,339 --> 01:38:32,574
But people aren't
talking about that,
2077
01:38:32,574 --> 01:38:34,076
no one wants to blame anybody.
2078
01:38:34,076 --> 01:38:35,510
If you wanna blame industry,
2079
01:38:35,510 --> 01:38:37,245
well, industry exists because
people buy their things
2080
01:38:37,245 --> 01:38:38,413
or use their things.
2081
01:38:38,413 --> 01:38:39,914
So they're the
ultimate consumers.
2082
01:38:39,914 --> 01:38:42,050
Are we gonna carbon tax them?
Are we gonna punish them?
2083
01:38:42,050 --> 01:38:43,550
Or maybe part of
the equation is,
2084
01:38:43,550 --> 01:38:45,087
we all accept responsibility
2085
01:38:45,087 --> 01:38:46,921
and we get a cultural
change to take place here
2086
01:38:46,921 --> 01:38:49,191
to go back to where we were
20, 30 or 40 years ago.
2087
01:38:49,191 --> 01:38:50,657
- We might, but that's hard.
2088
01:38:50,657 --> 01:38:54,196
- The vast majority of our
individual impact comes from,
2089
01:38:54,196 --> 01:38:57,099
housing, transport and food.
2090
01:38:57,099 --> 01:38:59,166
These are kinda big
structural issues
2091
01:38:59,166 --> 01:39:00,934
that can't really be
addressed adequately
2092
01:39:00,934 --> 01:39:04,272
by changing the brand
of paper towels you buy.
2093
01:39:04,272 --> 01:39:08,010
- We live in an energy
consumption society.
2094
01:39:08,776 --> 01:39:12,580
And the way to look at things,
2095
01:39:12,580 --> 01:39:17,419
we have to be aware that
nothing comes for free.
2096
01:39:19,221 --> 01:39:21,689
We have to be aware that
everything costs energy,
2097
01:39:21,689 --> 01:39:22,857
whatever you do.
2098
01:39:24,026 --> 01:39:26,460
(soft music)
2099
01:39:37,305 --> 01:39:40,308
- This is not what public
space looks like in the U.S,
2100
01:39:40,308 --> 01:39:43,145
but I noticed here
in the Netherlands,
2101
01:39:43,145 --> 01:39:45,413
everybody's riding
bikes everywhere.
2102
01:39:45,413 --> 01:39:46,781
- Yeah. Yeah.
2103
01:39:46,781 --> 01:39:51,386
- And that doesn't
strangely require gasoline.
2104
01:39:52,487 --> 01:39:53,755
- Nope.
2105
01:39:56,491 --> 01:39:59,127
(upbeat music)
2106
01:40:02,330 --> 01:40:06,234
- The question
is, can we replace
2107
01:40:06,234 --> 01:40:09,071
fossil fuels with
renewable energy?
2108
01:40:09,071 --> 01:40:11,005
And this is a very
tricky question.
2109
01:40:11,906 --> 01:40:16,644
It raises enormous debates
2110
01:40:16,644 --> 01:40:21,483
and people get angry when
you asked them this question,
2111
01:40:21,483 --> 01:40:24,752
because it is not
clear what you mean.
2112
01:40:24,752 --> 01:40:29,523
If you mean that you can
satisfy people's greed
2113
01:40:29,523 --> 01:40:31,659
with renewable energy,
2114
01:40:31,659 --> 01:40:33,027
then the answer is no.
2115
01:40:33,960 --> 01:40:37,465
If you mean renewable
energy could produce
2116
01:40:38,300 --> 01:40:42,770
a sufficient amount of
energy in order to survive,
2117
01:40:42,770 --> 01:40:44,672
then the answer is yes.
2118
01:40:44,672 --> 01:40:48,876
- We are in an energy efficient
home now, that we've rebuilt
2119
01:40:48,876 --> 01:40:55,383
that our household use
alone is twice the size
2120
01:40:55,383 --> 01:40:57,719
of the average American,
2121
01:40:57,719 --> 01:40:59,121
that woke me up,
2122
01:40:59,121 --> 01:41:00,688
I can't count the
number of trips
2123
01:41:00,688 --> 01:41:03,325
that I've taken around
the world for business,
2124
01:41:03,325 --> 01:41:05,827
but that two
international trips,
2125
01:41:07,228 --> 01:41:12,467
was equal to one year of
utility energy in my home.
2126
01:41:12,467 --> 01:41:17,405
And that really had me
thinking about travel.
2127
01:41:17,405 --> 01:41:20,742
It had me thinking
about what I eat.
2128
01:41:23,245 --> 01:41:24,978
- [Michael] Another
surprise for many people
2129
01:41:24,978 --> 01:41:27,182
is how much energy we
use in the food system.
2130
01:41:27,182 --> 01:41:28,916
- [Narrator] And
complete dinners.
2131
01:41:28,916 --> 01:41:30,352
- [Michael] In
the United States,
2132
01:41:30,352 --> 01:41:32,219
we use 100 quadrillion
BTU of energy a year.
2133
01:41:32,219 --> 01:41:34,255
A BTU is our British
thermal unit.
2134
01:41:34,255 --> 01:41:36,824
One BTU is about the energy
content of a kitchen match.
2135
01:41:36,824 --> 01:41:38,526
So in the United States, we use
2136
01:41:38,526 --> 01:41:40,928
100 billion million kitchen
matches of energy per year.
2137
01:41:45,767 --> 01:41:49,771
10 quads, 10 quadrillion
BTU is for the food system.
2138
01:41:49,771 --> 01:41:51,339
One of those quads is
in the food itself.
2139
01:41:51,339 --> 01:41:52,874
Food is a form of energy.
2140
01:41:52,874 --> 01:41:55,343
We're ingesting at one quad
of food energy into our bodies
2141
01:41:55,343 --> 01:41:57,579
for 330 million
Americans every year.
2142
01:41:57,579 --> 01:42:00,248
The other nine quads is for
the rest of the food system.
2143
01:42:00,248 --> 01:42:03,050
This is in the agrochemicals,
the fertilizers and pesticides
2144
01:42:03,050 --> 01:42:06,120
diesel for tractors, the
energy for refrigeration,
2145
01:42:06,120 --> 01:42:08,456
the energy for drying
crops at silos,
2146
01:42:08,456 --> 01:42:09,757
warehouses, transportation,
2147
01:42:09,757 --> 01:42:11,393
plus the energy to
cook at our homes.
2148
01:42:11,393 --> 01:42:12,627
- [Narrator] Pies are done.
2149
01:42:12,627 --> 01:42:13,861
- [Michael] Three or
four quads of that
2150
01:42:13,861 --> 01:42:15,463
is just for the cold chain.
2151
01:42:15,463 --> 01:42:16,798
That's the refrigeration system:
2152
01:42:16,798 --> 01:42:19,267
refrigerated trucks,
refrigerated warehouses,
2153
01:42:19,267 --> 01:42:22,304
and refrigerators and freezers
at our homes and businesses.
2154
01:42:22,304 --> 01:42:24,406
The energy embedded
in the cold chain
2155
01:42:24,406 --> 01:42:26,040
of the food system
in the United States
2156
01:42:26,040 --> 01:42:27,642
is more energy than
entire countries
2157
01:42:27,642 --> 01:42:30,545
like Switzerland and Sweden
consume in a year combined.
2158
01:42:35,250 --> 01:42:38,119
The energy embedded in the
edible food we throw away
2159
01:42:38,119 --> 01:42:41,623
is also enough to power
entire countries elsewhere.
2160
01:42:41,623 --> 01:42:42,990
Sadly, we throw away like
2161
01:42:42,990 --> 01:42:44,892
a fourth to a half
of our edible food.
2162
01:42:46,093 --> 01:42:48,663
(upbeat music)
2163
01:42:52,767 --> 01:42:54,636
- [Wesley] Okay so
Michael, here we are.
2164
01:42:54,636 --> 01:42:55,603
We're surrounded by water.
2165
01:42:55,603 --> 01:42:56,804
- [Michael] Yeah.
2166
01:42:56,804 --> 01:42:57,772
- [Wesley] And what's
the relationship
2167
01:42:57,772 --> 01:42:59,273
between water and energy?
2168
01:42:59,273 --> 01:43:01,075
- [Michael] The water energy
relationship is twofold.
2169
01:43:01,075 --> 01:43:03,278
One is we use a lot
of water for energy.
2170
01:43:03,278 --> 01:43:04,946
We use water to
cool power plants,
2171
01:43:04,946 --> 01:43:07,315
we use water to
irrigate biofuels,
2172
01:43:07,315 --> 01:43:08,782
we use water for oil
and gas production,
2173
01:43:08,782 --> 01:43:10,518
we use water to make
steam at refineries.
2174
01:43:10,518 --> 01:43:12,454
In fact, if you look all up and
down the energy supply chain
2175
01:43:12,454 --> 01:43:14,155
water's at every step.
2176
01:43:14,155 --> 01:43:15,990
- Our well went dry.
2177
01:43:15,990 --> 01:43:16,824
- Dead.
2178
01:43:16,824 --> 01:43:18,326
- Yeah, that's dead.
2179
01:43:18,326 --> 01:43:21,162
- This is where the water,
that would be the full mark.
2180
01:43:21,162 --> 01:43:24,866
It's not a fantasy
apocalypse movie landscape.
2181
01:43:24,866 --> 01:43:27,369
It's now and it's real.
2182
01:43:27,369 --> 01:43:28,702
- So the grid might be strained
2183
01:43:28,702 --> 01:43:30,538
if you don't have water
available for cooling,
2184
01:43:30,538 --> 01:43:32,507
at least the way we have
most power plants today,
2185
01:43:32,507 --> 01:43:33,708
where they use heat,
2186
01:43:33,708 --> 01:43:35,777
they then need a
water for cooling.
2187
01:43:35,777 --> 01:43:38,045
Modern forms of like solar
panels or wind turbines
2188
01:43:38,045 --> 01:43:39,814
don't need water coolings.
2189
01:43:39,814 --> 01:43:43,050
- The average life for PV
panels is what, 20 years?
2190
01:43:43,050 --> 01:43:43,951
- 20, 25 years.
2191
01:43:43,951 --> 01:43:45,219
- 20, 25 years.
2192
01:43:45,219 --> 01:43:47,522
- Maybe 30 years, yeah.
- So the people who say,
2193
01:43:47,522 --> 01:43:49,391
well, it takes seven
years of energy
2194
01:43:49,391 --> 01:43:52,193
to produce this PV panel,
but then you're getting,
2195
01:43:52,193 --> 01:43:54,896
that means you're getting 18
years of energy free.
2196
01:43:54,896 --> 01:43:56,398
So you've cut down.
2197
01:43:56,398 --> 01:43:59,133
- Even then you're getting 18
years of energy for free.
2198
01:44:00,234 --> 01:44:01,503
- So me John Q Public,
2199
01:44:01,503 --> 01:44:02,737
I'm like, hey man,
2200
01:44:02,737 --> 01:44:04,572
I wanna put some money
into your solar farm.
2201
01:44:04,572 --> 01:44:08,809
- No, not until the government
gets involved with things,
2202
01:44:08,809 --> 01:44:12,746
puts us into a pari passu
position with fossil fuels.
2203
01:44:12,746 --> 01:44:14,081
- I've got a lot of friends
2204
01:44:14,081 --> 01:44:15,517
who are in the
renewable business,
2205
01:44:15,517 --> 01:44:18,052
and there's a really
big problem in terms of,
2206
01:44:18,052 --> 01:44:19,821
you know, you've got the
power purchase agreement,
2207
01:44:19,821 --> 01:44:21,656
you've got all the
permitting done,
2208
01:44:21,656 --> 01:44:23,758
You've even got
interconnect agreements,
2209
01:44:23,758 --> 01:44:25,360
except what's happening is,
2210
01:44:25,360 --> 01:44:27,362
grid companies are delaying
2211
01:44:27,362 --> 01:44:28,563
and not letting
them on the grid.
2212
01:44:28,563 --> 01:44:29,764
What's going on with that?
2213
01:44:29,764 --> 01:44:31,999
- I think one of the
challenges we have is,
2214
01:44:31,999 --> 01:44:33,668
who has access to
the infrastructure
2215
01:44:33,668 --> 01:44:35,670
and democratizing
the infrastructure
2216
01:44:35,670 --> 01:44:37,271
is a way to open it up so that
2217
01:44:37,271 --> 01:44:39,841
more solutions can
be brought forward.
2218
01:44:39,841 --> 01:44:41,075
This is something that we did
2219
01:44:41,075 --> 01:44:43,344
with telecommunications
in the 80s with AT&T,
2220
01:44:43,344 --> 01:44:45,179
AT&T had built out all
the wires and poles,
2221
01:44:45,179 --> 01:44:46,681
and they were
required to open up
2222
01:44:46,681 --> 01:44:48,182
their infrastructure
for other companies.
2223
01:44:48,182 --> 01:44:50,284
And that's why we have
so many phone companies,
2224
01:44:50,284 --> 01:44:53,054
and long distance companies
now that we didn't have before.
2225
01:44:53,054 --> 01:44:54,522
The same thing could happen
2226
01:44:54,522 --> 01:44:56,624
with democratizing the
electrical infrastructure.
2227
01:44:56,624 --> 01:44:58,693
More solutions would be
plugged in more wind and solar,
2228
01:44:58,693 --> 01:45:00,027
and we have more
technologies along the way.
2229
01:45:00,027 --> 01:45:02,096
And this is where
long range planning,
2230
01:45:02,096 --> 01:45:04,065
stable governance really matter.
2231
01:45:04,065 --> 01:45:05,532
- Kind of what I'm hearing is,
2232
01:45:05,532 --> 01:45:07,902
it's not a technology problem.
2233
01:45:07,902 --> 01:45:09,136
- No, not a technology problem.
2234
01:45:09,136 --> 01:45:10,271
- It's not an
engineering problem.
2235
01:45:10,271 --> 01:45:12,639
- No.
- It's a financial
engineering problem.
2236
01:45:16,143 --> 01:45:21,115
- [Luka] Energy poverty, lack
of food, income inequality.
2237
01:45:21,115 --> 01:45:24,118
So it's up to us now
to form the policy
2238
01:45:24,118 --> 01:45:28,121
that is going to
help bridge this gap.
2239
01:45:28,121 --> 01:45:31,593
- In 1941, when the
United States went to war,
2240
01:45:31,593 --> 01:45:34,295
and people saved tin
cans and aluminum
2241
01:45:34,295 --> 01:45:38,833
and gave up, women gave
up buying nylon stockings,
2242
01:45:38,833 --> 01:45:41,669
and everything was done
for the war effort.
2243
01:45:41,669 --> 01:45:44,338
But the war was there,
was right in front of us.
2244
01:45:44,338 --> 01:45:47,273
And young men were being
drafted and sent overseas,
2245
01:45:47,273 --> 01:45:48,910
and casualties were coming home.
2246
01:45:48,910 --> 01:45:51,077
And this is different.
2247
01:45:51,077 --> 01:45:56,083
It requires the same type of
reorganization or commitment.
2248
01:45:57,018 --> 01:45:57,952
- But why didn't
they call on me?
2249
01:45:57,952 --> 01:45:58,853
I could have done something.
2250
01:45:58,853 --> 01:46:01,188
(jazz music)
2251
01:46:10,164 --> 01:46:12,099
- That was then,
and this is now.
2252
01:46:12,099 --> 01:46:13,601
Check out our new lot
2253
01:46:13,601 --> 01:46:17,138
the okay solutions lot with
millions of new solutions
2254
01:46:17,138 --> 01:46:19,340
and more coming
every single day.
2255
01:46:19,340 --> 01:46:22,043
Looking for something that's
easy and in your price range,
2256
01:46:22,043 --> 01:46:23,844
check out our
pre-owned solutions.
2257
01:46:23,844 --> 01:46:26,448
Like changing a light
bulb or walking to work,
2258
01:46:26,448 --> 01:46:29,651
or our mid-sized selections
like regenerative agriculture,
2259
01:46:29,651 --> 01:46:32,318
or a price on carbon,
or you'll love a variety
2260
01:46:32,318 --> 01:46:35,957
of brand new solutions with
that brand new solution smell.
2261
01:46:35,957 --> 01:46:38,660
Like de-leveraging climate risk
from the derivatives market,
2262
01:46:38,660 --> 01:46:41,896
or the million mile battery,
which is coming soon.
2263
01:46:41,896 --> 01:46:44,999
Just listen to one of
our satisfied customers.
2264
01:46:44,999 --> 01:46:47,068
- Michael, you are now in
charge of the United States
2265
01:46:47,068 --> 01:46:50,472
Energy policy and
you have free reign.
2266
01:46:50,472 --> 01:46:52,206
How would we make
the transition?
2267
01:46:52,206 --> 01:46:54,407
- For national security reasons
and for economic reasons
2268
01:46:54,407 --> 01:46:55,577
and for environmental reasons
2269
01:46:55,577 --> 01:46:57,011
there are many
reasons to do this.
2270
01:46:57,011 --> 01:47:00,748
We need to harden, improve
and expand our grid.
2271
01:47:00,748 --> 01:47:02,684
Maybe even using the
interstate highways.
2272
01:47:02,684 --> 01:47:04,351
We already have the rights
of way and put lines
2273
01:47:04,351 --> 01:47:07,088
above ground or below ground,
create a national network.
2274
01:47:07,088 --> 01:47:10,257
And then it will span and
reach to the sunny windy areas,
2275
01:47:10,257 --> 01:47:12,259
and already connects
to the urban areas.
2276
01:47:14,327 --> 01:47:15,530
And once we have the network,
2277
01:47:15,530 --> 01:47:17,098
we can plug in whatever we want,
2278
01:47:17,098 --> 01:47:19,701
build the infrastructure first,
then the energy will follow.
2279
01:47:19,701 --> 01:47:21,168
But we have to put a
price on pollution.
2280
01:47:21,168 --> 01:47:23,337
We'll take the money from
the price on pollution
2281
01:47:23,337 --> 01:47:25,005
to clean up the trash.
2282
01:47:25,005 --> 01:47:25,940
So let's take the United States
2283
01:47:25,940 --> 01:47:27,675
6 billion tons of CO2 a year,
2284
01:47:27,675 --> 01:47:28,910
put in the atmosphere.
2285
01:47:28,910 --> 01:47:31,178
And let's say we're
willing to pay
2286
01:47:31,178 --> 01:47:34,281
I don't know, $30
a ton to remove it.
2287
01:47:34,281 --> 01:47:36,050
That works out to if I
do my math correctly,
2288
01:47:36,050 --> 01:47:37,684
$180 billion a year.
2289
01:47:37,684 --> 01:47:39,053
Sounds like a lot of money.
2290
01:47:39,053 --> 01:47:40,287
That's less than what we spend
2291
01:47:40,287 --> 01:47:42,056
on just dealing with
trash from cities.
2292
01:47:43,290 --> 01:47:45,392
Why not spend another couple
hundred billion cleaning
2293
01:47:45,392 --> 01:47:46,960
up the waste in the atmosphere.
2294
01:47:47,795 --> 01:47:49,731
Let's take the CO2
and put it into the soil.
2295
01:47:49,731 --> 01:47:51,465
Like, let's pay farmers
to take the Co2
2296
01:47:51,465 --> 01:47:53,367
out of the atmosphere
into the soil.
2297
01:47:53,367 --> 01:47:56,070
(soft gentle music)
2298
01:48:01,909 --> 01:48:04,746
We need to get more of that
national security mindset.
2299
01:48:08,550 --> 01:48:10,084
- If you have a built
to last strategy,
2300
01:48:10,084 --> 01:48:12,219
then you do want to look at
2301
01:48:12,219 --> 01:48:14,321
what's happening in
these longer horizons
2302
01:48:14,321 --> 01:48:16,423
and it's absolutely critical.
2303
01:48:16,423 --> 01:48:19,326
- It's gonna take
all forms of energy
2304
01:48:19,326 --> 01:48:22,897
and all people to move us
through this transition.
2305
01:48:22,897 --> 01:48:26,166
- Otherwise, I don't think
we actually stand a chance.
2306
01:48:26,166 --> 01:48:28,603
(jazz music)
2307
01:48:29,503 --> 01:48:31,939
- I'm trying to get
rid of this car,
2308
01:48:31,939 --> 01:48:35,677
but it's like quitting
smoking, it's not easy.
2309
01:48:35,677 --> 01:48:38,445
You are so used
to certain things
2310
01:48:38,445 --> 01:48:40,782
that it is very difficult.
2311
01:48:43,017 --> 01:48:46,320
- The Romans had done
a lot of bad things
2312
01:48:46,320 --> 01:48:47,521
to the ecosystem.
2313
01:48:47,521 --> 01:48:48,956
- Yeah.
2314
01:48:48,956 --> 01:48:53,193
- But, they had not
destroyed it as we could do.
2315
01:48:53,193 --> 01:48:58,199
- FEMA estimates for
every dollar spent
on hazard mitigation
2316
01:48:58,199 --> 01:49:01,702
you save $4 in disaster
recovery costs.
2317
01:49:03,170 --> 01:49:04,871
So we're already
spending the money.
2318
01:49:04,871 --> 01:49:07,174
There's the sense that
it's perhaps too expensive
2319
01:49:07,174 --> 01:49:08,843
to prepare for climate change,
2320
01:49:08,843 --> 01:49:10,645
but we are already
spending the money.
2321
01:49:10,645 --> 01:49:13,480
We're spending it after
every disaster hits.
2322
01:49:13,480 --> 01:49:15,549
(airplane humming)
2323
01:49:15,549 --> 01:49:17,952
(jazz music)
2324
01:49:20,822 --> 01:49:23,791
- When I was growing
up, there was the draft.
2325
01:49:23,791 --> 01:49:26,227
So everybody thought they had
an obligation to the country.
2326
01:49:26,227 --> 01:49:30,031
If you went to a land-grant
college you were drafted.
2327
01:49:30,031 --> 01:49:32,466
Now it's different.
2328
01:49:32,466 --> 01:49:34,902
The trust in government's gone,
2329
01:49:34,902 --> 01:49:37,304
the obligation to
government is gone.
2330
01:49:37,304 --> 01:49:40,742
If we could take some of
that spirit of patriotism
2331
01:49:40,742 --> 01:49:45,579
and service and rebuild
it into doing something
2332
01:49:45,579 --> 01:49:46,914
for the environment.
2333
01:49:48,182 --> 01:49:50,584
- This entire thing
is built out of carbon
2334
01:49:50,584 --> 01:49:52,253
that comes out of
the atmosphere.
2335
01:49:55,356 --> 01:49:57,224
- We need a hundred
thousand young people
2336
01:49:57,224 --> 01:49:59,526
to give up part of their summer
2337
01:49:59,526 --> 01:50:02,228
and form up and
really work this.
2338
01:50:02,228 --> 01:50:04,264
We could control
these pine beetles
2339
01:50:04,264 --> 01:50:05,767
that are destroying the forest.
2340
01:50:05,767 --> 01:50:08,770
We could plant new trees, but
it should be done not only
2341
01:50:08,770 --> 01:50:13,675
for pay as a guaranteed job,
but it should also be done
2342
01:50:13,675 --> 01:50:17,879
for every citizen's obligation
to take care of the land.
2343
01:50:17,879 --> 01:50:19,380
That's what I'd like to see.
2344
01:50:19,380 --> 01:50:20,514
- It sounds like you're trying
to inspire a whole generation
2345
01:50:20,514 --> 01:50:21,716
of people to pay for it.
2346
01:50:21,716 --> 01:50:23,684
- Well, it sounds like something
that old guys would say.
2347
01:50:23,684 --> 01:50:25,019
(laughs)
2348
01:50:25,019 --> 01:50:25,952
- Whoa.
2349
01:50:25,952 --> 01:50:27,855
- Baby baby.
2350
01:50:27,855 --> 01:50:29,290
Can you smile for us?
2351
01:50:30,892 --> 01:50:32,193
That's a good noise.
2352
01:50:33,059 --> 01:50:35,697
It's made me want to be more
of a fighter for her sake.
2353
01:50:36,197 --> 01:50:39,532
The transformation is
potentially exciting,
2354
01:50:39,532 --> 01:50:41,235
because we can think not only
2355
01:50:41,235 --> 01:50:43,938
about losing things that
we have always wanted
2356
01:50:43,938 --> 01:50:45,272
but also letting go of things
2357
01:50:45,272 --> 01:50:47,709
that we perhaps
don't benefit from.
2358
01:50:48,475 --> 01:50:51,913
We can lose in order to
transform into something else.
2359
01:50:51,913 --> 01:50:55,549
It's not as kind of confident
that things will be okay,
2360
01:50:55,549 --> 01:50:57,919
but it finds possibility
in a ways that
2361
01:50:57,919 --> 01:50:58,986
things will have to change
2362
01:50:58,986 --> 01:51:01,723
in kind of really dramatic ways.
2363
01:51:02,156 --> 01:51:06,127
(speaking in foreign language)
2364
01:51:25,512 --> 01:51:28,349
- And so we are looking
at diversifying the types
2365
01:51:28,349 --> 01:51:31,252
of crops that we are
wanting to plant,
2366
01:51:31,252 --> 01:51:35,121
and also work with
conservation type programs
2367
01:51:35,121 --> 01:51:37,859
to help preserve
species and habitat.
2368
01:51:37,859 --> 01:51:40,427
And let nature take it's course
2369
01:51:40,427 --> 01:51:43,965
and bring back
species that we need
2370
01:51:43,965 --> 01:51:47,601
and that the crops actually
need to be productive.
2371
01:51:47,601 --> 01:51:50,004
(jazz music)
2372
01:51:53,440 --> 01:51:56,210
- [Warren] We don't want a
hurricane or a tropical storm,
2373
01:51:56,210 --> 01:51:58,813
they're already geared up
the crops are turned in.
2374
01:51:58,813 --> 01:52:00,614
They wanna go ahead
and get finished.
2375
01:52:00,614 --> 01:52:02,282
People wanna know where
their food came from.
2376
01:52:02,282 --> 01:52:04,518
Well, at some point maybe
people will wanna know
2377
01:52:04,518 --> 01:52:06,053
where their banker
lives and who he is.
2378
01:52:06,053 --> 01:52:07,822
And do I have a
relationship with him
2379
01:52:07,822 --> 01:52:10,858
that when I need some
money to fix something
2380
01:52:10,858 --> 01:52:12,894
I can maybe find
somebody to help me?
2381
01:52:14,460 --> 01:52:16,063
- Yeah, I mean,
it's not a matter of
2382
01:52:16,063 --> 01:52:17,898
the government
telling banks what to do,
2383
01:52:17,898 --> 01:52:19,800
or telling us what we can do.
2384
01:52:19,800 --> 01:52:22,736
No, I mean, there's still
lots of possibilities.
2385
01:52:22,736 --> 01:52:26,639
We should have smaller banks
basically split them up,
2386
01:52:26,639 --> 01:52:29,309
and not make them
too big to fail.
2387
01:52:29,309 --> 01:52:32,847
If they make mistakes, they
should fail without causing
2388
01:52:32,847 --> 01:52:34,681
a total systems crisis.
2389
01:52:36,217 --> 01:52:39,585
And probably what also needs
to be done is introduce rules
2390
01:52:39,585 --> 01:52:42,489
which make it impossible
for the financial sector
2391
01:52:42,489 --> 01:52:45,759
to create within the
financial sector itself
2392
01:52:45,759 --> 01:52:47,594
so much additional debt.
2393
01:52:50,197 --> 01:52:54,768
- We have to somehow correct
this market imperfection.
2394
01:52:54,768 --> 01:52:57,004
- If you want to
have a derivative,
2395
01:52:57,004 --> 01:52:59,073
if you want to hedge
your risk fine,
2396
01:52:59,073 --> 01:53:01,541
but you must have exposure
to the underlying asset.
2397
01:53:03,710 --> 01:53:05,913
- [Robert] I remember
I was watching on TV
2398
01:53:05,913 --> 01:53:08,282
after a major flood
down in Florida,
2399
01:53:08,282 --> 01:53:10,517
and they were interviewing
this guy and he said,
2400
01:53:10,517 --> 01:53:14,455
"My father rebuilt twice, my
grandfather rebuilt twice."
2401
01:53:14,455 --> 01:53:16,723
And he says, "And I'm
gonna rebuild again".
2402
01:53:16,723 --> 01:53:18,425
And the reporter turned
into the camera and said,
2403
01:53:18,425 --> 01:53:20,094
"That's the American way".
2404
01:53:20,094 --> 01:53:24,231
Well, I thought the reporter
should say, that's stupid.
2405
01:53:26,400 --> 01:53:29,270
You can't keep doing
it over and over again
2406
01:53:29,270 --> 01:53:31,272
that's the definition
of insanity.
2407
01:53:33,707 --> 01:53:38,079
- So it's basically trust
in the monetary management
2408
01:53:38,079 --> 01:53:41,148
and trust in the future
productivity of a country
2409
01:53:41,148 --> 01:53:43,650
that gives us trust
in the currency.
2410
01:53:43,650 --> 01:53:46,387
Not the idea that there
are some gold barons hidden
2411
01:53:46,387 --> 01:53:47,487
in the federal reserve.
2412
01:53:47,487 --> 01:53:49,891
(jazz music)
2413
01:53:51,157 --> 01:53:54,594
- And so there is a
point of resistance
2414
01:53:54,594 --> 01:53:57,664
at which governments
aren't going to be,
2415
01:53:58,332 --> 01:54:01,936
have access to capital
to address the problem.
2416
01:54:03,337 --> 01:54:05,072
- We're rich.
2417
01:54:05,072 --> 01:54:06,840
(thunderstorm rumbling)
2418
01:54:06,840 --> 01:54:08,175
- You know, the fear is,
2419
01:54:08,175 --> 01:54:09,943
if we cannot bail out
the system anymore
2420
01:54:09,943 --> 01:54:12,746
it will come crushing down
with huge side effects.
2421
01:54:13,680 --> 01:54:15,648
The hope and that
sounds a little cynical
2422
01:54:15,648 --> 01:54:19,020
but I think the hope is
we probably can reorder
2423
01:54:19,020 --> 01:54:21,522
our system only after a crash.
2424
01:54:21,522 --> 01:54:23,690
And I think that human
history is such that
2425
01:54:23,690 --> 01:54:26,660
we are unable to make
really fundamental change
2426
01:54:26,660 --> 01:54:29,530
in the way we live and the
way we organize ourselves
2427
01:54:29,530 --> 01:54:31,132
without such a crash.
2428
01:54:31,132 --> 01:54:34,201
Nobody wants it, and I'm the
last person who wants it.
2429
01:54:34,201 --> 01:54:37,603
And if I think back to the
1930s, and I'm German, right?
2430
01:54:37,603 --> 01:54:39,473
And you think about
what the repercussions
2431
01:54:39,473 --> 01:54:42,009
of a major crisis can be.
2432
01:54:42,009 --> 01:54:43,877
We just don't know how
we would get out on
2433
01:54:43,877 --> 01:54:45,546
the other end of the tunnel.
2434
01:54:45,546 --> 01:54:48,049
I think without this
crisis, I just don't see
2435
01:54:48,049 --> 01:54:50,817
enough political leverage
to fundamentally alter
2436
01:54:50,817 --> 01:54:53,387
the way we organize
our financial system.
2437
01:54:54,621 --> 01:54:56,357
- When climate change happens,
2438
01:54:57,291 --> 01:55:00,061
there will be real problems
and it will be real,
2439
01:55:00,061 --> 01:55:02,029
as you said, there will
be real scarcities,
2440
01:55:02,029 --> 01:55:04,630
and it will be real migrants
coming, and there will be an...
2441
01:55:04,630 --> 01:55:06,200
- And that's what I,
2442
01:55:06,200 --> 01:55:08,169
and then will really be
broke because it'll be
2443
01:55:08,169 --> 01:55:11,405
after you've had that collapse
of the inverted pyramid.
2444
01:55:11,405 --> 01:55:12,706
And then it's like, then it's
2445
01:55:12,706 --> 01:55:15,376
like asking Somalia to
fight climate change.
2446
01:55:15,376 --> 01:55:16,309
- Yeah, yeah.
2447
01:55:18,812 --> 01:55:21,348
- [Wesley] So your
criticism would be
2448
01:55:21,348 --> 01:55:23,017
that we're not facing reality
2449
01:55:23,017 --> 01:55:24,818
and not adapting to it?
2450
01:55:24,818 --> 01:55:26,253
- That's correct.
2451
01:55:26,253 --> 01:55:28,655
- My answer to that is, I
still have faith in democracy.
2452
01:55:28,655 --> 01:55:30,691
I believe we can
do it as a people.
2453
01:55:30,691 --> 01:55:32,994
I believe we can
do it as a society.
2454
01:55:32,994 --> 01:55:34,761
And I believe we can
take the institutions
2455
01:55:34,761 --> 01:55:37,898
of the United States that have
served this country very well
2456
01:55:37,898 --> 01:55:41,035
for over 200 years, and
move into the 21st century
2457
01:55:41,035 --> 01:55:43,437
and still help lead
mankind forward.
2458
01:55:44,205 --> 01:55:47,108
It's an article of
faith, but it's the faith
2459
01:55:47,108 --> 01:55:48,442
that motivates action.
2460
01:55:49,276 --> 01:55:51,278
We have almost all the tools
2461
01:55:51,278 --> 01:55:53,447
and all the financial resources,
2462
01:55:53,447 --> 01:55:57,384
and all the institutions that
could solve this problem.
2463
01:55:57,384 --> 01:56:01,288
It's the kind of challenge that
could bring mankind together
2464
01:56:01,288 --> 01:56:03,790
in a way we've never been
brought together before.
2465
01:56:04,958 --> 01:56:07,193
- I wish there was
more conversation,
2466
01:56:07,193 --> 01:56:10,864
more guys on the opposite
side talking together.
2467
01:56:10,864 --> 01:56:12,766
Because everybody as we feel,
2468
01:56:12,766 --> 01:56:14,701
there are people feeling
opposite from us
2469
01:56:14,701 --> 01:56:17,271
that are just as righteous
and all of that stuff.
2470
01:56:17,271 --> 01:56:19,706
But we ought to get
together to see...
2471
01:56:19,706 --> 01:56:22,043
- The thing if you get
together with people like this,
2472
01:56:22,043 --> 01:56:24,245
what you find is
the disagreements
2473
01:56:24,245 --> 01:56:27,081
are pretty narrow actually.
- Yes, that's what I mean.
2474
01:56:27,081 --> 01:56:30,384
- The people are mostly
agreed on like 95%.
2475
01:56:30,384 --> 01:56:31,618
- Yeah.
2476
01:56:31,618 --> 01:56:33,820
- But, but there are
forces in the culture
2477
01:56:33,820 --> 01:56:37,924
that want to sharpen and
popularize those disagreement.
2478
01:56:37,924 --> 01:56:38,825
- Yeah.
2479
01:56:38,825 --> 01:56:40,161
- It's a human nature issue.
2480
01:56:40,161 --> 01:56:40,994
- Okay?
2481
01:56:40,994 --> 01:56:41,962
- So what sells?
2482
01:56:43,330 --> 01:56:44,264
Tell me, what sells?
2483
01:56:44,264 --> 01:56:45,398
What do you pay attention to
2484
01:56:45,398 --> 01:56:46,400
when it's happening around you?
2485
01:56:46,400 --> 01:56:47,334
- You gotta find people--
2486
01:56:47,334 --> 01:56:48,835
- Conflict, conflict, conflict.
2487
01:56:48,835 --> 01:56:50,071
- It's true. It's true.
- That's it.
2488
01:56:50,071 --> 01:56:53,273
- To create that
kind of a dialogue
2489
01:56:53,273 --> 01:56:54,741
between a father and a son,
2490
01:56:54,741 --> 01:56:57,478
that love thing, I
mean, this is my kid.
2491
01:56:57,478 --> 01:57:00,013
You guys must have some
wild conversation man.
2492
01:57:00,013 --> 01:57:01,582
- It's what gets me.
2493
01:57:01,582 --> 01:57:03,784
I totally...
- This is the basis
2494
01:57:03,784 --> 01:57:05,519
- disagree with that.
- of democracy and capitalism.
2495
01:57:05,519 --> 01:57:07,621
- No, I disagree with that.
2496
01:57:07,621 --> 01:57:10,191
(wind blowing)
2497
01:57:19,800 --> 01:57:22,803
(gentle jazz music)
184032
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