WEBVTT FILE

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(cinematic music)

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Downloaded from
YTS.MX

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Official YIFY movies site:
YTS.MX

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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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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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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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that in the fullness of time,

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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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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

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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.

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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.

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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."

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And then my travel guy was like,

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"well it's populated

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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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- 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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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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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.

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- There've been empires
that formed and collapsed.

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And about 200 years ago,
mankind suddenly discovered

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how to take energy more
effectively from the earth.

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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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and the price that's being paid

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is the carbonization
of the atmosphere

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and climate change.

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(car engine roaring)

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- Yeah, that's the finale.

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(upbeat music)

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- 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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Now we've been involved
in so far, a 19 year war.

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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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We were never told
to save anything.

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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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(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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Not unlike the banking system

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in our political
system nowadays.

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It's all rigged. People don't

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have an actual
choice in a lot of stuff.

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Yeah, people have a
choice to go to Vegas.

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- When you ran for president,

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I drove all over New
Mexico and other places.

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All I could think
in 2003 was that,

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we can't actually
build an economy

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off stripping, gambling
and crystal meth.

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And we've made a concerted
effort to do that

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in this country for
the last 20 years.

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- You know, our business
caters to what people want.

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American societies produced
enormous amounts of leisure.

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- They've tried to recreate
the feel of the Roman Empire

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in the heart of Vegas.

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And interestingly it's
like late Roman Empire.

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So it's right, as
everything collapsed.

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- We have the smarts
and the know-how

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and the conscience to know

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we have to sustain
and protect this earth

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because this is where we live.

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So we love civilization,

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but we've got to change

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the way we're approaching
our economic endeavors.

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- The world is suffering

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through the worst financial
crisis since 1930s.

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- There's been a
lot of damage done.

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- They hear $700
billion package,

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and they immediately
think the next day

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everything is gonna be better.

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- You're witnessing
so much wealth loss.

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- If you connect
the financial system

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to the other possible
shocks that are out there,

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you realize it's,
we're walking on ice.

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- Panic coming
through the phones,

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on the floor, traders
just trying to rush

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to get to the point of sale,

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to get rid of their stock.

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- [Man] You know,
what people built up

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over years and years and
years, has been erased.

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(bell ringing)
(people applauding)

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- At some point, you run a
risk that something goes afoul.

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We're worried about Greek debt.

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We're worried
about Italian debt.

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- Spanish debt.

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- I mean and so far, you
know, it's been finessed,

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but, and you know,

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you can't see what the U.S
Treasury is doing behind.

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We're doing a lot with
the U.S Government

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to keep the system working.

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And you just don't know
what the limits are.

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- So if you think,

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how can we lead the world
in fixing the economy

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and fixing the climate?

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You have to make
the investments now.

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Because you can't wait
till you're like Somalia.

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I mean, you may notice

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Somalia doesn't have a lot
of infrastructure programs

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that they fund.

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They're not pushing the
boundaries in technology,

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and that's not because
people in Somalia are stupid,

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it's not just because they've
lived under civil war,

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it's because they
don't have capital.

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They don't have resources.

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- Capitalism is an
economic organization.

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It's a way of
organizing the economy

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that is focused on trying
to create future returns

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over and above of the
investments I make today.

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So it's all about expansion.

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It's all about making
more in the future

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than we currently have.

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- When you borrow money,

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well, what happens is,

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the banks would like
to charge you interest

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not only for the risk,

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but because they want
the capital to come
back with babies,

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not just to go and that's it.

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Because they want to make sure
that capital is increasing

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and that's how you build wealth

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and that's how you
increase your assets.

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- And it's that debt
that has enabled

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all of this to be here.

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It's the accelerant
to economic growth.

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- Now, as long as the company

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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)