David Sirota is an award-winning journalist and best-selling author living in Denver, Colorado. He was nominated for an Academy Award most recently for his work helping Adam McKay create the story for the blockbuster film, Don t Look Up, which became one of the most widely viewed movies in Netflix history. He also created Audible s Financial Crisis Podcast, Meltdown, which was named One of the Best Podcasts of the Year by The Atlantic and by Uproxx. David has a seven-page curriculum vitae with a long list of awards and articles in his books, but the area that he s concentrated on is exposing corruption, shining a light on Wall Street and the domination of our political system by business interests. He served as Bernie Sanders' presidential campaign speechwriter in 2020. David is the founder and editor of The Lever, and how can we reach The Lever? You can read it at TheLever.net. You can also reach David at DavidSirota@thelever.net, and you can read his book, which is out now: on Amazon, which is available in Kindle, iBook, Paperback, and Hardcover. You can get a copy of his latest book: Don't Look Up for only $19.99. If you don t have a Kindle device, you can get it here: Kindle: Kindle $9.99, or you can buy it for 99.99 at amazon for $99.99 (including Audible $99, Audible 4999, and Audible for 4999). or Audible 9999, which gets you an Audible membership starting at $99 a year.99 a month, plus shipping starts at $49.99 for a maximum of 4999.00 a month. Kindle Free Trial. Kindle Freebie: 4999 Freebie, or buy it on Audible Freebie for 99 euro, and get a 2-piece copy of the Kindle Fire HD Pro edition starting at 4999 for 99 euros, or 4999 euro, or get a 7-piece CD Projekt Provenance Projo Provenza Pro, a 4GBR Projojojoistrix Projoistrically, a 5-piece deck set of 5-in-a-piece of hardcover edition of $99 or 4-in CD Projoio Projoire Projectrix Projex Projoirta, a 32-piece softcover copy of The Leanback edition of the book
00:00:00.000We have an amazing guest today, and I'm really honored to have you, David.
00:00:05.000Our guest is David Sirota, an award-winning journalist and best-selling author living in Denver, Colorado.
00:00:10.000He was nominated for an Academy Award most recently for his work helping Adam McKay create the story for the blockbuster film Don't Look Up, which became...
00:00:22.000One of the most widely viewed movies in Netflix history.
00:00:26.000McKay and Soroto also won the Writers Guild America's 2022 Award, the best original screenplay.
00:00:35.000David is the founder and editor of The Lever.
00:00:44.000And he is an editor-at-large at Jacobin Magazine and a columnist for The Guardian.
00:00:50.000He served as Bernie Sanders' presidential campaign speechwriter in 2020.
00:00:55.000He also created Audible's financial crisis podcast, Meltdown, which was named one of the best podcasts of the year by The Atlantic and by Uproxx.
00:01:06.000David has a, I'm looking at about a seven-page curriculum vitae with Long list of awards and articles in his books.
00:01:17.000But the area that he's concentrated on, I think, really distinguished himself in is exposing corruption, shining a light on Wall Street, and the domination of our political system by business interests.
00:01:32.000And one of the, David, one of the overarching themes of this podcast and of my life has been the theme of agency capture.
00:01:40.000and the subversion of our democracy by large corporate interests, that with a spear tip of their attack on democracy is often in gaining a beachhead and gaining control over the regulatory agencies that are supposed to protect Americans from their bad behavior and transforming those that with a spear tip of their attack on democracy is often in gaining a beachhead and gaining control over the regulatory agencies that are supposed to protect Americans
00:02:06.000It's what people talk about today as a public-private partnership, which is another name for fascism, for corporate fascism.
00:02:14.000It's the owner-merger of state and corporate interests, which is not a healthy thing for democracy.
00:02:20.000I spent 20 or 30 years of my life fighting the agency capture at the USDA, suing the companies that basically run USDA, Smithfield Foods, Cargill, Monsanto, Heysen's Foods and ultimately Cargill, Monsanto, Heysen's Foods and ultimately processed food companies too, like Kraft and McDonald's and Coca-Cola.
00:02:44.000Suing the EPA and the industries that have captured that, the pesticide industry, the oil industry, and the coal industry.
00:02:52.000Suing CDC, FDA, and NIH, which are captured by Big Pharma.
00:03:00.000Trainwreck is really ultimately a product of a failure of government.
00:03:06.000It's a product ultimately of agency capture.
00:03:09.000You've done a really good job in recent days of shining a light on the capture of corruption at DOT. So can you talk to us, start by talking to us a little bit about that?
00:03:22.000And I think agency capture is the right term.
00:03:25.000Agency capture meaning agencies basically doing the bidding of the industries they're supposed to be regulating.
00:03:32.000In this case, I think there's a direct through line.
00:03:34.000Our reporting at the Lever has shown that in the lead up to the Ohio train derailment, there were a series of decisions, deliberate decisions made, not to regulate the railways with safety rules that were being recommended by experts.
00:03:50.000This is a story that goes back about a decade or so.
00:03:54.000And about a decade or so ago, there was a spate of train derailments that ultimately prompted the Obama administration to finally start considering new rules for trains carrying hazardous materials.
00:04:05.000And that's a good thing that those rules were proposed.
00:04:09.000But in the process of proposing those rules and considering those rules, there was a key decision made.
00:04:15.000One of those trains was the bomb train that went off.
00:04:19.000In Canada, right on the U.S. border, and I think it killed 49 people, it was very similar to this.
00:04:26.000It was a derailment from oil field fuel that was being shipped to the United States and pipelines that came to the United States, and that really enervated this move to try to regulate railroads and make them safer.
00:04:43.000And there was another train disaster leak of the same chemical, vinyl chloride, at issue in Ohio.
00:04:50.000So the Obama administration starts considering these new rules.
00:04:53.000And if you follow the rulemaking process, it's always the devil is always in the details.
00:04:58.000And one of the key details was, first and foremost, how do we define what a high hazard flammable train is?
00:05:07.000because then from there, that means who the rules are applied to.
00:05:12.000The NTSB, the National Transportation Safety Board, came to the Obama regulators who were considering this and said, the rules should be broad.
00:05:20.000It should cover all sorts of hazardous materials from crude oil and ethanol all the way to what's known as class two chemicals, like, for instance, vinyl chloride.
00:05:30.000The chemical industry then came to the Obama administration and said, no, no, no, no, no.
00:05:37.000They should only really cover so-called oil trains, crude oil trains.
00:05:41.000And the Obama administration, while acknowledging that a lot of public comments from cities and towns across the country and the like, and environmental groups had argued for a broader definition, the Obama administration sided with the chemical lobby and decided to narrow the definition of the safety the Obama administration sided with the chemical lobby and decided to And I should mention, the rules would do things like mandates, speed restrictions for trains that are called that are classified as high hazard flammable trains.
00:06:07.000It would require better braking systems.
00:06:11.000It would require more disclosure to communities that these trains run through, and it would require stronger mandates for the kinds of tanks that are used to carry this material.
00:06:21.000So the Obama administration made a very fateful decision to ignore the NTSB, side with the chemical lobby, and narrow the definition of rules, which is why, by the way, the Ohio train, I think People may have heard this.
00:06:33.000The Ohio train, which blew up into a giant fireball, 100-foot flames, was not actually classified as a high-hazard flammable train.
00:06:42.000It was a Class 2 train rather than a Class 3 train.
00:06:45.000Even though it was carrying, as we said, vinyl chloride and the like.
00:06:53.000Actually, and what was kind of disturbing, by the way, I should mention, I haven't mentioned it elsewhere, but in looking through these rules, at certain points, the agency is trying to decide between what is a combustible material and what is a flammable material, right?
00:07:07.000I mean, this is the kind of parsing that goes on, which is kind of nonsensical.
00:07:11.000So the Obama administration makes this decision, a very fateful decision.
00:07:14.000But there is one thing that's left in the rules that's important, a mandate that at least the trains that are covered by the rule...
00:07:23.000We'll have to be upgraded to what's known as electronic pneumatic braking systems, upgraded from the Civil War era air brake system that is used on most of the nation's railways right now.
00:07:35.000The idea was that at least it would begin the process of making electronic brakes a more advanced braking technology to prevent derailments.
00:07:42.000It would make those more of an industry standard.
00:07:45.000It would make them more widely used on the nation's rails.
00:07:51.000And it's worth mentioning that before that mandate, the rail industry itself had been touting this, had been saying these brakes work really well to prevent derailments and to mitigate the impact when derailments happen.
00:08:06.000But the moment there was floated a mandate for that, that the government was going to say, OK, well, they're so good, we're going to require them.
00:08:13.000The industry flip sides and started lobbying against it.
00:08:17.000First, they got Senate Republicans to start championing a repeal of the brake rule.
00:08:22.000And then ultimately, after about six million dollars of campaign contributions flowed to Republican campaign coffers in 2016, Donald Trump got into office and promptly repealed, even though it was limited in scope, repealed the brake rule.
00:08:36.000So that effectively, there wasn't a mandate anymore for the rail industry to begin using these brakes writ large in the lead up to the Ohio disaster.
00:08:46.000So those are regulatory decisions that were made, that were debated, made, they were not accidental, and they created the regulatory environment in which this derailment happened.
00:08:57.000And worth adding, in which now roughly about a thousand derailments happen every year in America.
00:09:03.000And let me just, all right, let me sort of go into a few details.
00:09:07.000One is Norfolk Southern was one of the companies that was touting the ECT brake system, and then as soon as they said, okay, this is a good idea, they said, well, wait a minute, not so fast.
00:09:34.000But it's emblematic of the regulatory climate that these companies are operating in.
00:09:38.000And it's worth adding, well, okay, if they're saying that the brakes, for instance, would cost too much, what are we talking about?
00:09:43.000How much money are we talking about here?
00:09:44.000And the industry's estimate was $3 billion, which on its face, you might say, wow, that's a lot of money.
00:09:50.000But in reality, and it is a lot of money, but in reality, that's about two weeks of operating revenues in a single year for the rail industry.
00:09:58.000So to the rail industry, that is a rounding error.
00:10:03.000But that's important to get to the larger point about how the rail industry operates, which is like a lot of industries.
00:10:11.000It is focused solely on profits and buybacks, by the way, spending billions and billions and billions of dollars on stock buybacks, which effectively enrich executives and shareholders.
00:10:20.000So the business model of the rail industry is a business model that presumes that they will not be regulated stringently, that cost-cutting is the thing that they should focus on, buybacks and the like.
00:10:34.000That's where they want to use their money.
00:10:36.000And they presume that they will not be punished, not face real consequences if and when things go bad.
00:10:43.000And it's worth adding when we talk about this, that that's in particular a kind of business model that a monopoly or an oligopoly can embrace for this reason.
00:10:54.000There are certain businesses where if you mess up, if you screw up, if you damage, if you hurt people, even if the government isn't stringently regulating you, you face a problem where there can be consumer pushback, where consumers can say, you know what, I'm going with another choice.
00:11:13.000It doesn't care about, it's irresponsible.
00:11:15.000But when it's a monopoly, The customers don't have a choice, right?
00:11:18.000If you want to ship things from the East Coast and buy rail moving West, you're probably going to have to use Norfolk Southern or one of the other rail giants in the country, meaning that Norfolk Southern and these rail giants get to rely on a lack of regulation at the governmental level, but also knowing that there's no recourse for their customers.
00:11:40.000The people who need to ship goods, there's no ability for the customers to To even hold the company accountable.
00:11:48.000So it's a really perfect storm, which then means it's even more incumbent on the government, the cop on the beat, if you will, to actually enforce the rules and to strengthen the rules because the customers don't really have a choice.
00:12:02.000It's worth, when we talk about buybacks, it's worth considering that about 1.2% of Norfolk Southern stock is owned by management.
00:12:15.000So the management team that decides that they're going to spend their money, instead of spending $3 billion on a break system, they're going to spend $200 million, which is what they spend buying back their own stock.
00:12:28.000That then raises the value of their own personal stake in the company.
00:12:33.000And they get richer no matter how many people they kill.
00:12:37.000And the people who own this company and who are benefiting are the management team that owns this huge amount of the stock.
00:12:46.000I mean, 1.2%, a company that's making a billion and a half a week, 1.2% of the total value of that company is many, many billions of dollars.
00:12:58.000The amount of money that they're talking about is huge.
00:13:02.000The other owners of this company are Vanguard, which owns 8.14%, BlackRock, 6.91%.
00:13:12.000And keep in mind that BlackRock and Vanguard also own each other.
00:13:16.000So it's basically a single entity that owns 16%.
00:13:21.000And then J.P. Morgan and, you know, owns 4% at Wells Fargo.
00:13:26.000So you have these major Wall Street players who do not care what happens in East Palestine, Ohio.
00:13:33.000What they want, and they don't care about safety.
00:13:41.000And I think, look, I think the rail industry in particular is a kind of cartoonish caricature of the sort of business model in corporate America writ large.
00:13:52.000But it really does stand out for how egregious their business model is.
00:13:57.000I mean, this is an industry that has cut thousands and thousands of workers.
00:14:02.000When we talked about cost cutting, thousands and thousands of workers To effectively finance these stock buybacks.
00:14:10.000I mean, we're in a situation now where the Department of Transportation's much touted rule That it's big act, that it's been...
00:14:19.000And it's not a bad thing that it's doing this, but this is where we are.
00:14:23.000This is considered kind of a big step towards regulation, is to mandate at least two people on these trains.
00:14:33.000These trains are a mile plus long, and the industry has so successfully deregulated itself, convinced the government to capture the agencies, if you will, that it...
00:14:46.000It's now considered a tough regulation to require two people on mile-plus-long trains.
00:15:19.000And this is, again, a business model that is all about cost-cutting.
00:15:25.000These are wildly profitable companies spending billions and billions of dollars on stock buybacks to inflate the price of the stock, to enrich executives and shareholders.
00:15:35.000All while they are cutting thousands of workers.
00:15:37.000By the way, workers who have been saying amid these cuts, if you cut at this level, you will reduce safety standards.
00:15:44.000It will be harder to maintain the trains.
00:15:45.000It will be harder to detect emergencies on moving trains and the like.
00:15:52.000Meanwhile, they're spending millions of dollars to lobby the regulators to reduce and weaken regulations.
00:15:59.000So in a sense, it's a perfect kind of emblematic example of the entire model here.
00:16:06.000And my hope is, is that the reporting that we've done, which has asked questions about the governmental decisions, that that prompts better governmental decisions.
00:16:15.000Because here's my take, and I don't know, I presume you probably agree, but my take is that these companies, I don't care if it's Norfolk Southern or another rail company, They're going to make these decisions to try to maximize profit at the expense of everything.
00:16:30.000They play inside of the game and that ultimately they're playing inside of the rules that are set up for them.
00:17:30.000You've mentioned some of the kind of obvious common sense safety regulations, like having two men on a train because, you know, by the way, people fall asleep.
00:17:41.000Not one of those CEOs would get on an airplane with only one pilot on it.
00:17:47.000Because, you know, anything can happen.
00:17:49.000The guy could have a heart attack, he could fall asleep.
00:17:55.000And by the way, airplanes don't crash.
00:17:59.000Statistically, airplanes are zero crashes.
00:18:03.000And the Railroads don't crash all the time, and their crash rates actually are dropping because of electronics, etc.
00:18:13.000But when they do crash, the consequences are so high that, you know, it's insane not to do just the common sense thing, like have two people on a train.
00:18:27.000BlackRock is pushing this company and squeezing so hard...
00:18:32.000They say, we don't want to have to pay for that second guy on the train.
00:18:36.000And one of the reasons they're able to do that is because they've also used political clout to, again, all that political clout, they're escaping the discipline of the free market.
00:18:46.000As you pointed out, there is no free market here.
00:18:50.000I would say you've got to operate safely because the consumer doesn't have any choice but to ride that, to use that service because it's a monopoly.
00:18:59.000But one of the things they've used political clout for is to reduce the top level of a fine for an atrocity like this, for a violation, to $220,000.
00:19:54.000It knows in the Southwest case that it needs to make because it presumes that regulators won't crack down, that the fines are a rounding error.
00:20:04.000So I had a kind of a back and forth with one legislator and they were saying, you know, we need to hold Norfolk Southern accountable.
00:20:13.000But I also said, again, I go back to this point, which is I don't expect Norfolk Southern or Southwest Airlines or Or any of these other companies to do anything better than what they are allowed to do.
00:20:25.000They are going to mistreat communities, individuals, customers and the like as much as they are allowed to if the customers have no recourse because they're monopolies and knowing that the regulators aren't going to crack down on them or even that the rules allow them to misbehave.
00:20:44.000So the focus has to be on Well, what kind of rules need to be in place to deter this behavior?
00:20:52.000There's got to be a real financial threat that if you cut costs so much that you damage communities, you're not just going to pay for the cleanup.
00:21:02.000You're not just going to pay to make people whole.
00:21:03.000There's going to be punitive penalties that actually create a financial cost to your bottom line.
00:21:09.000When it comes to railroads, there's other things that can be done.
00:21:15.000I mean, there has been reporting about how there were sites, there was images of flames on one of the wheels, on the trains, miles before where the derailment happened.
00:21:24.000But as the Wall Street Journal reported, there are no regulations about how many or if there need to be, how frequently, heat sensors occur.
00:21:33.000On the rails that would give the two or three people on the train a warning that there's something wrong before it's too late, right?
00:21:41.000There's plenty of things that can be done.
00:21:44.000And in Europe and other places, they have those sensors so that the pilots, the engineer is looking at a monitor and he can tell whether a mile back that one of the wheels is getting overheated.
00:22:00.000So there's plenty of things that can be done.
00:22:02.000And I want to say one other thing about the Republicans.
00:22:06.000I do think that clearly the Obama administration made a fatefully bad decision to narrow the definition of high hazard flammable trains.
00:22:14.000But it's not like the Republicans, who are now making hay out of the situation, have been proponents of tougher safety regulations.
00:22:22.000It was the Republicans in Congress who touted repealing the even limited break rule while they were raking in campaign cash.
00:22:31.000I mean, one senator, John Thune from South Dakota, became the number three recipient in the Senate of railroad money while making this his cause.
00:22:44.000Was given an award by the rail industry's lobby group while he was leading this campaign.
00:22:51.000This is flagrant in your face corruption.
00:22:55.000There's no pretending it is anything other than what it is.
00:23:00.000And I think a lot of folks have become used to this.
00:23:03.000This has become normalized and it can't become normalized.
00:23:05.000We can't allow that kind of behavior to become normalized.
00:23:09.000And I would add that President Trump is going to be out there this week.
00:23:14.000And it is, you know, there's hypocrisy there because President Trump repealed the ECT break rule.
00:23:21.000He repealed the Biden era rule that there should be two people on the train.
00:23:25.000There's other, you know, things that, and we're going to come to the Democrats later because their hands aren't clean either.
00:23:32.000You know, I think Pete Buttigieg, we need to talk about.
00:23:35.000I've called for his, in a tweet when this first happened, I called for his firing.
00:23:40.000And because I think that that is something, you know, the regulator has a responsibility, and we have to tell America about that.
00:23:48.000I want to talk to you about that in a minute.
00:23:49.000But also, I want to point out another rule that is obvious, which is the DOT 117 car rule, which is a kind of car which can contain These kind of toxic loads without leaking them.
00:24:05.000And there is a rule that at some point the railroads have to replace their cars with a DOT-117 car, but it's not till 2029, which is, again, another piece of insanity.
00:24:19.000It's a rule that is putting profit-tearing by these companies ahead of public health and public welfare.
00:24:26.000And then the contempt that these companies have for public health and for public welfare and for the communities through which they are hauling this highly toxic material.
00:24:39.000And, you know, polyvinyl chloride is one I've dealt with it for many, many years.
00:24:52.000It has all kinds of horrendous effects.
00:24:55.000EPA is down there now telling people they can drink the water, which is insane.
00:25:00.000But the contempt for these communities is evinced by the fact that Norfolk Southern offered the town of East Palestine $25,000 as a settlement for this.
00:25:15.000I mean, it's an embarrassingly low amount of money.
00:25:18.000And then they offered people, I guess, what was $1,000, quote unquote, convenience checks.
00:25:22.000Look, these companies are not used to ever being held accountable.
00:25:25.000My guess, I'm just guessing here, is that they expect this all to just blow over and attention will turn and they will not be held accountable.
00:25:34.000My hope is, is that in this case, that's not the case.
00:25:37.000I also think there's an interesting, if you read closely some of the reporting on this, I think the Biden administration got caught flat footed in this way.
00:25:46.000I think the Biden administration presumed that this would just blow over.
00:25:50.000It would be one of a thousand train derailments.
00:25:52.000You've seen some quotes from some folks in, you know, Buttigieg's team or allies of his sort of saying, listen, we have a thousand train derailments every year.
00:26:01.000We didn't expect this one to get so much attention.
00:26:03.000And what I think is interesting about that is if you read between the lines, the insinuation is, well, look, America's gotten used to this.
00:26:11.000And nobody ever gets held accountable.
00:26:14.000So it's actually weird that people are being called on the carpet and held accountable.
00:26:19.000And this is getting so much attention.
00:26:20.000And I think what's interesting is it's kind of inflected in some of the coverage from Washington as if this is not just weird, it's kind of bad, it's kind of odd and strange.
00:26:28.000But actually what's odd and strange is that when things like this happen, oftentimes they are normalized.
00:26:35.000It's like a one-day story and it goes away.
00:26:43.000I think some of the conspiracy theories on the right about what's going on in Ohio and the like, I don't agree with those.
00:26:51.000But my point is, if there's attention from the right, from the left, from the center, from corporate media, from independent media, the more attention on this, the better.
00:27:01.000Because what it says is we should not accept this.
00:27:06.000This is not something you just, it's just a one day story and goes away.
00:27:10.000Because here's the thing, even if it's happening, you know, this particular situation is a toxic cloud over a relatively small town in Ohio.
00:27:19.000These trains are going through all sorts of communities all over the country.
00:27:30.000I mean, I was critical of President Biden going to the Ukraine with $500,000, but now, you know, the $60 billion total check that week.
00:27:40.000Instead of going out to Ohio and dealing with, you know, a crisis in this country and the, you know, I think the Trump administration is most at fault here, but the Biden administration is at fault too.
00:27:52.000And there were a lot of safety demands when the railroad workers were going to strike last year in December.
00:27:59.000And Biden pushed through legislation to kill that strike and to force them to go back to work.
00:28:48.000And by the way, My son spent a year working in Iowa and around the country for his presidential campaign, and I know Pete, and, you know, I've said that he needs to resign over this.
00:29:00.000This is, you know, we need to hold regulators accountable, or this is never going to get fixed.
00:29:05.000Look, I hearken back to the halcyon days of the Bush administration, and I'm half kidding.
00:29:13.000But there is a story that now seems quaint, but is important.
00:29:21.000After Hurricane Katrina, America became aware that there was a very unqualified or underqualified person running the Federal Emergency Management Agency.
00:29:30.000The response to Hurricane Katrina was bungled.
00:29:33.000The president came out and sort of said, you're doing a heck of a job to the person who was in that job.
00:29:45.000Public pressure was so intense that Michael Brown had to resign.
00:29:48.000And I don't say this with any enmity towards Michael Brown or any of the individuals involved, but the point is that's how the system's supposed to work, right?
00:30:13.000So wherever you come down on the question, wherever listeners come down on the question of whether Pete Buttigieg should resign or not, the idea of him resigning should be on the table in the sense of that's how it's supposed to work.
00:30:28.000When something like this happens, The first thing the public should ask is, who is in charge?
00:30:35.000Who was asleep at the switch, if you will?
00:30:39.000And does there need to be a personnel change?
00:30:42.000Now, folks may wonder, what does Pete Buttigieg really have to do with this?
00:30:46.000You've told me that the Obama administration made one decision, Trump made another decision.
00:30:50.000Well, the answer to that question is the Biden administration under Pete Buttigieg's Department of Transportation has not to date tried to reinstate these safety rules that we're talking about, reinstate and expand them.
00:31:04.000On top of that, there was silence for two weeks or a week and a half from the Biden administration effectively.
00:31:10.000And then there was this sort of insinuation by Buttigieg which was actually maddening, where he first came out and sort of tried to insinuate that he doesn't really have the power to do much, which is a lot of nonsense.
00:31:20.000Let me tell you, under current law, the Department of Transportation has a whole heck of a lot of power.
00:31:26.000To regulate, to put in place without Congress, to put in place safety rules as it sees fit.
00:31:32.000Now, certainly Congress can do more, but the notion that the Department of Transportation, the head of the Department of Transportation, that his was silent first and then his first reaction was sort of like, I don't really have much power.
00:31:53.000President Biden's right, finally said it.
00:31:55.000You know, the rail industry spends a lot of money lobbying.
00:31:57.000But the other part of this is, well, where did the regulator come from?
00:32:00.000The regulator comes out of a pedigree from, you know, the business world, McKinsey and the like, which is not a world where you advance by pushing powerful people around.
00:32:13.000Pete Buttigieg came out originally of McKinsey.
00:32:17.000McKinsey is the big consulting firm that advises Fortune 500 companies how to cut costs by firing workers.
00:32:25.000And they're pretty bloodless, shark-like company that is not about improving a lot of humanity.
00:32:36.000It's about how to perform better on Wall Street.
00:32:40.000And it's certainly not about pushing powerful corporations around.
00:32:46.000And I think America is learning a lesson here, which is important, that we need people in regulatory positions who are not afraid to push powerful corporations they regulate, push them around.
00:32:59.000That it's not a great thing to have, to go back to what we started talking about, Agency capture at the top of an agency.
00:33:07.000To use the metaphor, there needs to be, in these regulatory positions, cops on the beat.
00:33:14.000And you have to look no further, as an example, to the FTC, where Lina Khan has been, what's actually very interesting, has almost the same regulatory authority over what she regulates that Pete Buttigieg has over what he regulates.
00:33:29.000And you see her aggressively Using that regulatory authority to, for instance, most recently ban non-competes among businesses.
00:33:38.000So she's in that job understanding my job is not to appease the people I regulate.
00:33:43.000My job is to protect the public and push powerful people around if that's what it takes to protect people.
00:33:48.000And I think that's what we need at the Department of Transportation.
00:33:51.000Now, I will say, I think the pressure on Pete Buttigieg is forcing him into that role right now, or at least forcing him into promising to better do that job.
00:34:01.000Now, we will see if there's follow-through, but my view is that if he remains at the Department of Transportation, the only way we're going to get follow-through is if there is constant focus on him and the agency itself to deliver on those promises.
00:34:14.000And just to remind our listeners of an interesting fact, Pete Buttigieg's predecessor at DOT was Elaine Chao.
00:34:23.000Elaine Chao has a long history, of which the major theme is dismantling the regulatory state, getting rid of regulations.
00:34:33.000The businesses that we're supposed to be regulating are actually our clients, the public-private partnership.
00:34:40.000Elaine Chao's husband is Mitch McConnell.
00:34:43.000Who gets money from the railroads, and he's one of the senators that helped kill this regulation and these regulations in the Senate while she was killing it at DOT as President Trump's DOT director.
00:34:59.000Let me ask you this, because there's this extraordinary waltz that's going on, and I know enough about regulations and about the regulatory system.
00:35:14.000It is an extraordinary coincidence that you have almost this collusive effort by CDC and by EPA at the same time where a week before this crash takes place, CDC downgrades the lethal risk of vital chloride by a thousand times.
00:35:36.000In other words, it used to be that the lethal that CDC was telling people and posting on its website for 17 years That the lethal exposure to polyvinyl chloride was 100 parts per million.
00:35:50.000The week, I think six days before this crash, It raises that to 100,000 parts per million.
00:35:57.000And what that means is that EPA then goes in there and measures the water and tells everybody it's safe to drink, even though it stinks of chemicals and even though the fish and animals are dead in the water.
00:36:10.000But because the CDC raised these action levels, it now becomes safe by fiat and declaration, if not by biology and reality.
00:36:23.000I mean, what a crazy coincidence, right?
00:36:25.000And to be clear, I do think it is an unfortunate coincidence, but it does say, what is the attitude of the people running these agencies?
00:36:38.000And that ultimately, I mean, we're really getting to the core of You could take a million different issues, you know, the FAA and Boeing and the crashes, you could do the railroads, you could do Southwest Airlines and the airline industry as a whole.
00:36:50.000We clearly have a problem where the government, the people running regulatory agencies, many, not all, but many, are not really serious about the idea of regulating.
00:37:03.000They think they are there to enable and not regulate.
00:37:20.000I think Gary Gensler at the SEC has been a much more aggressive regulator than past SEC chairs, by the way, of both parties in a lot of ways.
00:37:30.000So I think we're in the throes here, and maybe I'm just being an eternal optimist, but in the throes here of raised awareness, And a kind of public mass education about what happens when you don't have cops on the beat regulating the industries that can run roughshod over everything else.
00:37:47.000And my hope is that the lesson that comes out of this is we need more of this.
00:37:53.000Republicans are being honest when they're, you know, criticizing the Biden administration or Pete Buttigieg.
00:37:59.000I don't think it's good faith criticism, but the silver lining is that they have rhetorically kind of opened the door to the idea that even they would support, for instance, on this rail situation, better safety rules.
00:38:14.000It's incumbent, to my mind, on the Democrats to call their bluff, right, to say, hey, Ted Cruz, You just said you generally agree that rail safety rules haven't been good enough.
00:38:27.000As an example, I went on social media and I said this.
00:38:31.000There could be a one-page bill today, a one-paragraph bill, that would say The definition of a high hazard, flammable train, that definition is made by the National Transportation Safety Board.
00:38:44.000The people that we have in government whose only job is to protect safety, they get to make the decision, not the folks in the bureaucracy of the Department of Transportation.
00:38:52.000And I say that because, of course, just to remind everyone, the NTSB said...
00:38:57.000Class II chemicals like vinyl chloride should be included as what constitutes a, if they're on board a train, that's a high hazard flammable train.
00:39:03.000So let's make the safety regulators the ones who get to decide what is a high hazard flammable train.
00:39:10.000If there was actually a vote on that bill, I mean, I don't want to make predictions in a Congress that's as corrupt as it is, but you put everybody on the spot to say, hey, you've You're pretending to care about rail safety?
00:39:20.000Here's the easiest thing in the world.
00:40:28.000Found on levernews.com, L-E-V-E-R. It's one of the last remaining readouts of investigative journalism in this country.
00:40:39.000It's one of the sites that is looking out for the rest of us when it comes to the incursions of business and corporate power against our democracy.