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David Sirota 0:08
Hey there and welcome to leisure time the flagship podcast from the weather, an independent investigative news outlet. I'm your host, David Sirota on today's show a packed show. We're going to be talking about soup gate, aka su pocalypse aka the soup heard round the world. Everyone is now apparently a soup Nazi. Nothing for you. Come back. I'm of course referring to the pair of climate activists who stun the world last week by proving that people care more about soup on an old painting, rather than making sure the planet doesn't boil us all alive. Also, remember how the lever was reporting on that bill that gave 10s of billions of dollars to a handful of microchip companies, the bill that was supposed to create lots of jobs, guess what? It's not working out as planned. Then the levers big investigation into one of the Senate races deadlocked in the polls, a Senate race that could decide who controls Congress, and yet one that hasn't really been reported on very much. If you've never heard of the candidate, Ted Budd, than boiboi Are you going to hate this guy when we're done. For our final segment today, we're going to be talking about bankruptcy, and how recent laws have allowed bankruptcy to be used and abused by powerful corporations. While still punishing regular people. You may have heard of the opioid case, you may have heard of the Johnson and Johnson case. And you may have most recently heard of the Alex Jones case, I'm going to be talking with one of the foremost experts on bankruptcy law, who's going to help us break down how and why the bankruptcy system is being used and abused to protect some of the most powerful people in the world. This week, our paid subscribers will also get a bonus segment, the levers interview with the authors of our veterans, a new book, which explores the impact that military service has on our country's veterans, as well as the problems that they face after their service. If you want access to lever time premium, you can head over to lever news.com To become a supporting subscriber that gives you access to all of our premium content. And you'll be directly supporting the investigative journalism that we do here at the lever. Speaking of which, if you're looking for other ways to support our work, share our reporting with your friends and family leave this podcast a rating and a review on whatever podcast player you're listening to it on. The only way that independent media grows is by word of mouth, and we need all the help we can get to combat the inane bullshit. That is corporate media. As always, I'm here with producer Frank, what's up, Frank?

Producer Frank 2:46
Not much, David feeling a little under the weather this week. I think we're both feeling under the weather this week. I don't know if something's in the air maybe? Well, COVID is in the air. That's true. The the famous pandemic that researches every time, fall rolls around.

David Sirota 3:01
Do you know you know I got COVID right after Joe Biden told me that the pandemic was over. I don't know. I thought I was I was outraged because I was told the pandemic was over. I guess it's not

Producer Frank 3:12
you must be wrong. You must have gotten faulty tests because the pandemic is in fact over. Biden was correct in that so I think that that sounds like a huge problem.

David Sirota 3:21
I gotta tell you, man COVID flattened me out like, and I don't know if it's like I'm a weakling or I got a big viral load but like people with all COVID It's like a it's like a mild cold or I didn't even notice I got I was like out on like, in bed couldn't move for almost a week. I mean, it really flattened me and I will cop to being the kind of guy who gets like a man cold and complains about a little much. I'm sure my wife would say that. But like it really nailed me. And it kind of reminded me like, if you got this thing, unvaccinated, and you had any kind of weakness in your system, man, no wonder this thing really knocks people down. And this it's not something to mess around with. I mean, I guess that's my PSA to say, Listen, go get faxed, and try to not put yourself in the position of deliberately getting breathed on a lot in a small confined space because this is the kind of thing you don't want this. If you didn't have it. You had it right, Frank?

Producer Frank 4:21
I had it back in in spring of 2001. Yeah, it was not like same as you just absolutely knocked on my ass for like a week and a half straight. Turns out, not a good disease. Turns out very, very bad to have. Okay,

David Sirota 4:35
now let's get to our news roundtable for today. For the first half of today's show. I'll be joined by the levers Julia rock. Hey, Julia. Hey, David. How's

Julia Rock 4:42
it going? Okay.

David Sirota 4:44
And I'm also going to be joined by the livers newest reporter, Rebecca burns. Hey, Rebecca. Hey, David. Okay, before we get into the stories that the two of you reported on this week, I wanted to quickly touch on what was easily the biggest story in The World last week last Friday to young climate activists made international headlines when they threw a can of Heinz tomato soup. At Vincent Van Gogh's sunflowers at London's National Gallery and then glued themselves to a wall. The tour from the group just stopped oil whose goal is to make the British government tried to end all of its licenses development and production of fossil fuels. As they were glued to the wall, one of the activists asked onlookers if they were, quote, more concerned about the protection of a painting, or the protection of our planet, and people. Okay, so let's just get your quick take on that. What do we make of the soup? Broers? Julia,

Julia Rock 5:43
I'd like to start by saying it's brave, you know, they're young, they have a really good pause. I totally respect that. I think if we're going to look at it from the standpoint of effective protest tactics, I'm pretty critical of it just in the sense that, you know, the question they pose to onlookers is sort of an unfair one, because they're implying that, you know, just caring about the future of the planet would would really, you know, make a difference in in what the British government decided to do and sort of proclaiming that their protest might have the impact of, you know, changing the course of the British government's stance on climate change. And it just didn't seem like a protest with a specific demand that had any chance of, of being successful, but it did sort of successfully piss people off. So I tend to be pretty skeptical of that type of protest, if I'm being completely honest.

David Sirota 6:37
Rebecca, do you agree or not agree with Julia?

Rebecca Burns 6:40
Yeah, well, you know, this was one of those moments on the internet, where the full range of sort of takes in reaction to this event actually crossed my feed before I got to read about what it actually happened. So, you know, I agree, I'm a little bit skeptical about the tactic itself, the target they picked, but it was also pretty dismaying to just see sort of the widespread dismissal of, you know, young people being angry and taking risks as a result of that. Yeah, I mean, one of my reactions was just I hope that these young people sort of haven't been talked by some NGO person and into really screwing up their lives. So yeah, could have been a more effective protest. But yeah, I agree with Julie, I want to say that it was, you know, a brave action. Also,

David Sirota 7:29
I think it should be mentioned that the painting was not damaged. And my presumption is that they knew that the painting wouldn't be damaged. Because it's behind a piece of glass. It's pretty well, four to five. So the painting was apparently back in the museum all cleaned up, the glass was cleaned up, so the painting wasn't even touched at all. I have like a meta view of this. I feel like if the soup throwers actual goal was to prove that nobody cares about anything anymore at all, then the reaction that they prompted a vigorous discussion about fucking soup throwing, rather than about the climate apocalypse actually kind of proved their point. Like, I mean, if that was their point, I tend to agree with you. I mean, I don't spend a lot of time thinking about or criticizing protesters for whether their tactics are appropriate or not. But I do think that in an era where the world is being incinerated, and people feel like they're not being listened to, that prompts kind of desperate acts kind of public tantrums, public spectacles, and in this case, the reaction to it. Let's talk only about soup throwing it all. I'm having a fainting spell about soup thrown against the glass that's cleaned up in two hours and no big deal. That the reaction itself was like, I feel like we should have written it as a subplot in don't look up. I mean, I really do like I'm kind of annoyed that we didn't write this into our movie. Okay, moving on to a story that we reported this week. Julia, you report it this week. A story that is important to follow up on. We were one of the only news organizations in the entire world to be reporting diligently on the concerns being raised about that high profile bill to hand 10s of billions of dollars of government money to a handful of microchip companies this happened to over the summer. There were very, very few critics who warned that this bill passed by Congress worth adding passed by Congress after you'd had cut off things like the extended Child Tax Credit, jobless benefits in the like, in the name of budget austerity. Congress goes ahead and passes a massive bill to give these tech companies lots of money in the name of creating jobs. And we were one of the organizations reporting on the very few critics who said hey, listen, if you don't attach string So this money, these companies could use the money, not in the way that they are promising. Now, we have reported that some of those warnings seem to be proven true. Julia, tell us tell us what happened.

Julia Rock 10:14
Just a piece of context for this is that these are chip companies that are notorious for having spent the past 20 years, offshoring jobs and spending way more money on buybacks and dividends than investing in capital expenditures. And so the day that the chip bill passes Congress, the main company lobbying for it Intel announces that it's slashing capital expenditures. Now, just a few months later, Bloomberg is reporting that Intel is planning to lay off 1000s of workers. And meanwhile, as has been the story with this industry, and with Intel, in particular, for the past couple of decades, Intel is continuing to issue a dividend to its shareholders. So by the end of this year, Intel will have spent $6 billion on dividends to shareholders will slashing capital expenditures by at least $4 billion dollars and presumably laying off 1000s of workers.

David Sirota 11:13
I mean, my question on these kinds of stories is, as always, what stage of capitalism, quote, unquote, capitalism is this, I mean, really, you've got a situation where the entire effectively corporate media, almost the entire political class, brushed off any concerns about hey, maybe cutting a check, a giant check to Intel, without any strings attached, will not guarantee that a company like Intel actually uses the money to create the jobs that the politicians are promising will come out of this money. And voila, just a few months later, outcomes entails big dividends to shareholders and reportedly plans to layoff 1000s of people. I mean, it's just it's not it's not a surprise. But I guess I would ask the question, maybe Rebecca, you want to take this? Why do you think this wasn't in the conversation really, at all? Why do you think these questions aren't in the conversation at all? When bills like this move through Congress?

Rebecca Burns 12:24
Yeah, it's always sort of shocking how much the discussion of these types of things relies on sort of an assumption of good faith of corporation involves, no matter how many times we're, you know, given ample evidence to assume the opposite. Yeah. And it's obviously also, you know, the failure of, of media often to raise these questions and sort of the critical moments where the discussion of this stuff is live and, you know, you're able to actually get put some real teeth.

David Sirota 12:55
Now, let's get into one of the lesser reported on Senate races, the big stories at the lever this week. There's a guy named Ted Budd, the Republican Senate nominee, running for an open seat in North Carolina, North Carolina, the polls in this Senate race, race are deadlocked. It's been a race that's been kind of off the radar, but literally a race deadlocked in the polls that could decide control of the Congress. And it's been billed if at all in the national media as a kind of boring race. Because, of course, the national press the corporate press, doesn't want to really do any reporting on anybody in the race. We took a look at TED but the Republican nominee, who has surprise surprise, been up to some wildly corrupt looking bullshit. As Julia reported for the lever this week, uh, but currently a congressman representing North Carolina's 13th district. He used his congressional office to pressure federal regulators into letting financial institutions try to evade North Carolina's own predatory lending rules. He also tried to go to law preventing those same big financial companies from hammering small businesses and consumers in North Carolina with debit card fees. And of course, these moves coincided here's the kicker with influxes of campaign donations from Wall Street donors, Juliette, let's talk about this first fight that bud picked once he arrived in Congress, this debit card fee situation because I don't think anybody listening enjoys paying high debit card fees. And Ted Budd portrayed himself positioned himself as a small business guy. So he gets into Congress as a small business guy and the very first thing Ted bud does is pick a fight over debit card fees. Tell us that story.

Julia Rock 14:59
Okay, so this is A story about how the Dodd Frank Act, which passed after the financial crisis as an attempt to rein in the banks and prevent another crisis included a provision that had cost banks $9 billion. So when bud arrives in Congress, the banks are pissed about losing this revenue. And he decides to go to bat for them to try to help them get it back. At Issue were debit card fees, which banks charge retailers when transactions are made. So, you know, you swipe your debit card, and the retailer has to pay a fee to complete the transaction. The Dodd Frank Act had put a cap on the fees that banks could charge. And that was what had led to the $9 billion in lost revenue. But it tries to include a provision in the GOP s big bill to rollback Dodd Frank that is going to roll back this specific cap on debit card fees. The banks are lobbying really hard for it. The small businesses are lobbying really hard against it. And bud takes the side of the bank something that other Republicans were unwilling to do sort of given how much it was pissing off business, but in the banks ultimately lost that fight. But he really rose to sort of national fame for how controversial it was that he took the side of banks in, you know, a fight that many Republicans even Republicans weren't willing to weigh on on because how it pitted banks against retailers.

David Sirota 16:34
So this is like cartoonish level of corruption guy gets elected being Mr. Small Business, he's a gun store owner, I'm Mr. Small Business I care about the retailing community, gets in the Congress immediately. Lots of money comes to him from the banks. And he's like, I want to help the banks, hammer retailers and small businesses with higher debit card fees, I want to let them I want to unleash them, to hammer people in my small businesses in my own district, people consumers in my own district with higher and higher debit card fees. Then he goes on, while he's on the House Financial Services Committee to pressure regulators to effectively help many of those same bank donors get around North Carolina's interest rate cap, its landmark predatory lending laws. Now, this is a very complicated story. So try to summarize it for us in what he did and how what he was trying to do. visa vie regulators happened in conjunction with campaign cash from interested at Wall Street parties.

Julia Rock 17:44
So a bunch of states including North Carolina limit basically how evil predatory loans can be, they limit the interest rate that these lenders can charge for, you know different consumer things like cars or payday loans. And oftentimes the limits in North Carolina the limit is 36%, which it is, in many other states in states without limits, you'll see these lenders charging like 300% interest rates. So the lenders want to be able to charge the higher interest rates, bypassing strict state laws like those in North Carolina. So Ted Budd goes and pressures regulators to allow this maneuver called rent a bank, where these predatory lenders use banks basically to bypass the state interest rate laws.

David Sirota 18:30
So totally aboveboard rent to bank that sounds completely, totally innocent, totally aboveboard. Totally normal.

Julia Rock 18:37
And the remarkable thing about this is that bud is pissing off regulators in North Carolina as well. So the state attorney general, the bank Commissioner are saying, you know, if you pass these rules, we're going to be unable to enforce our own state laws against predatory lenders.

David Sirota 18:57
So, again, somebody gets to Congress. As Mr. Small Business Mister, I'm from the bootstraps, I care about regular people, money starts pouring in from huge banks, and in conjunction well timed, by the way with his letters, pressuring regulators to let those banks get around his own state laws, despite regulators in his state, saying, Yo, dude, this is going to cost North Carolina small businesses and consumers up to half a billion dollars in new fees. I mean, this is an incredible story. And this is a guy again, who is the Republican nominee for Senate. And let's mention one other point here. The American Bankers Association is now airing a last minute package of ads to try to boost him into the Senate. But that's not where the story stops, because we also reported a separate story Rebecca did for the lever, about Ted Budd and his courageous This defense of huge banks, in specific, a huge bank merger that is not necessarily so great for North Carolina. As Rebecca reported in 2019, two regional banks in the southeast, proposed a merger, which would have effectively become the country's sixth largest bank, running the risk of creating another too big to fail monster, which tends to lead to layoffs, worse consumer customer service, higher customer fees, etc, etc. That summer when the proposed merger came before congressional oversight committee, allegedly everyman hero, Ted Budd, now the Senate nominee in North Carolina, then in the middle of his second term in Congress, he comes to the heroic aid of the poor little giant banks. Rebecca, what was the result of Bud's intervention? What specifically did he do with that hearing? And what happened with the merger? After afterwards?

Rebecca Burns 21:02
Yeah, so you know, in 2019, this was a merger that created what's now truest bank. And it was really the first merger of its size since the financial crisis. So there was a real push among consumer advocates among Democrats like Maxine Waters, to give this issue the scrutiny it required. So we have a hearing before the House Financial Services Committee, which Budds serves on with the CEOs of these two banks that are applying to merge. Both of them have track records of, you know, being penalised by federal agencies. So you have people like AOC, you know, asking about their records of systemic mortgage servicing abuses, things like that. Then we get to Ted Budd. So he starts by saying this is a political hearing. It's unnecessary, both of your banks are strong. And then he addresses the CEO of the regional bank, BB and t. And now this is actually already his campaign donor. The CEO has personally donated 1000s of dollars to his campaign, in addition to money from the banks PACs. She's

David Sirota 22:08
totally aboveboard, completely, just totally normal. Right. We

Rebecca Burns 22:12
love to see it and oversight hearings. And then but thanks him thanks him for all the bank's contributions to North Carolina's economy, but uses them the rest of his time just sort of set up the CEOs to talk about how great the merger will be for customers for communities. You know, he says there won't be any layoffs or any of these other concerns that people are raising. The merger then goes through later that year in 2019. And we get through a spank the new sixth largest bank in the country.

David Sirota 22:45
And I'm sure everything's completely fine, right. Everything truest is I mean, nobody has any complaints at all. Everything's everyone lives happily ever after or No,

Rebecca Burns 22:54
that's right, right. Yeah, we all know, the bigger the bank is, the better the customer service they provide. No. So we have pretty immediately a pretty widespread backlash from customers who are reporting that actually, as you know, the technological integration of these two already huge banks goes through, they're locked out of their accounts, they can't use their debit cards. Now remember back in the hearing, but had also sort of asked the CEOs, isn't it true, there won't be any layoffs at all. And they had said yes, no layoffs just relocations, so just a year into the merger truest simultaneously reports it's made 1.2 billion in profits, and it's laid off more than 1300 people. This has continued where they say now they've actually surpassed their goal of closing 800 branches, many of them in North Carolina, and cut their workforce, I think by about 8000 people and they're still going with this.

David Sirota 23:53
So a little bit more context here during his 2020 house reelection campaign, but gets more than $20,000 in direct contributions from truest executives and the company's PAC, more than $23,000. Now for from from the same sources from for his Senate bid, making him the bank's top recipient in the 2022 election cycle. As I mentioned, the American Bankers Association, the North Carolina Bankers Association of which truest is part of they are now airing ads to try to vault Ted Budd into the Senate in this deadlocked North Carolina race. And one other piece of context. Tell me if I'm wrong here, Rebecca Ted Budd was also while doing this specifically at this hearing. He was also a big backer of legislation to make these kinds of bank mergers easier. Is that right?

Rebecca Burns 24:44
Exactly right. So yeah, in addition to sort of going to bat for the banks at this hearing, we've seen Ted Budd sort of as one of this contingent of sort of frothing deregulatory fans who are really just clearing The way for this type of merger to accelerate again, including championing legislation, initially, he wanted something that would have just exempted banks all together, and then backing the legislation that made this type of merger, you know, possible and profitable for banks.

David Sirota 25:19
One last point on this, which kind of blows my mind and both of you great reporting on this. Again, this is the kind of reporting that should be basic happening all over the country. Follow the money reporting about Senate races about Senate candidates. And this is one of again, one of the most important Senate races in the country. And there isn't a lot of misreporting. So kudos to you for doing this reporting. One other point that kind of boggles my mind I just want to make which is that this is a Senate race to succeed. A scandal plagued Republican Senator Richard Burr made huge headlines only a little while ago for that trading scandal where he made a personal stock trades. During an in advance of the COVID 19 pandemic. There was an SEC investigation, FBI documents have come out. So here you have a situation where you've got the incumbent, the retiring incumbent effectively forced out of office because of the scandal, retiring Republican incumbent in a financial scandal. And the Republican Party of North Carolina is like instead of being like, hey, we need a really anti corruption candidate to clean house, everything smells here. They're like, yo, let's get the dirtiest, most corrupt bank lobbyist in Congressman's clothing that we can find. And let's find Ted Budd, and just coalesce around him. And I think it says something about the Republican Party and how little they care about corruption, even though they run out and claim to be against crony corruption. And I also think it kind of speaks to how little the entire political environment seems to care about follow the money kind of corruption, these kinds of of of blatant, blatantly scandalous behavior that has now been so normalized. It's just It hasn't even been a topic in the conversation in one of the most important Senate races in the country. Maybe it will, because of the leverage reporting. Julia, Rebecca, thank you both for your fantastic reporting. And thanks for taking the time with us today. Yeah, thanks so much, David. We're gonna take a quick break, but we'll be right back with our deep dive into how the biggest companies in the world are abusing bankruptcy laws that are supposed to protect regular people. Welcome back to lever time. For our final segment. Today, we're going to be talking about bankruptcy, but in a different way than you might expect. For most of us, we think of bankruptcy as that unfortunate thing that happens to someone when they can't pay their debts, a person goes to bankruptcy court and sells off all of their remaining assets, then gets to have the remainder of their debt either restructured or discharged completely. Now, thanks to Joe Biden, back in the 2000s, this became much harder for regular people that it became harder for them to get bankruptcy protections. However, it's become even easier for fake people, aka corporations, to now use those same bankruptcy courts to protect themselves from punishment when they do horrible things, like for instance, poisoned 1000s of people. For the last several years, bankruptcy laws have been completely abused by corporate giants looking to shield themselves from legal liability, while also protecting the majority of their wealth and protecting their executives and protecting their shareholders. You may have heard of some of these big cases that are happening right now. We're talking about profitable pharmaceutical giants like Johnson and Johnson trying to now use bankruptcy court to get out of lawsuits alleging the company's baby powder poisoned 1000s of women. We're talking about the billionaire Sackler family, otherwise known as the opioid drug lords, who are now trying to use Purdue pharma as bankruptcy to stop lawsuits aimed at them. And most recently, we're talking about right wing extremist and conspiracy theorist Alex Jones, potentially trying to us bankruptcy court to shield himself from having to pay damages in the successful defamation suit against him by the families of Sandy Hook shooting victims. To help us break down all of these abuses and the manipulation of bankruptcy court. We're now going to be going to my interview with Melissa Jacoby. Melissa is a professor of law at the University of North Carolina Chapel Hill, where she teaches bankruptcy law contract law and commercial law She is an expert, specifically at the bankruptcy courts. And she's got a new draft paper called fake and real people in bankruptcy that's available at the link in our show description. Melissa, thanks for joining us really appreciate you taking the time.

Melissa Jacoby 30:16
Thanks for having me, David.

David Sirota 30:18
So bankruptcy is something that you are an expert at and that I am fascinated with. And also, in a lot of ways grossed out by and you have a recent paper that kind of, I think summarizes why I am kind of grossed out by how the bankruptcy system is being used. Your paper talks about how the bankruptcy code in a lot of ways, is punishing regular human beings and protecting what you call fake people, which I think is kind of a stand in that term for corporations. Give us a broad overview of what you mean by that. Why are real people and fake people treated differently in our bankruptcy system?

Melissa Jacoby 31:12
Well, I'm glad you're getting fascinated with this topic because it affects so much more than just a narrow subject of a couple debts being restructured from time to time. And our legal system has so many kinds of bias in it. This is really just one. When I'm talking about fake people, I do mean big corporations. But I also mean nonprofits. I mean, sometimes cities and other kinds of municipalities, anything that gets created by the Fiat of law rather than being a human. And here's the situation that we have financially distressed families when they encounter bankruptcy, they face many restrictions on the depths that they can cancel or restructure their cases are nitpicked for mundane spending choices. The design of the system really is about deterring people who need it most. And it's hard to understand why that would be a good thing given the role. Bankruptcy fails. Now, there is nothing cheap or easy about chapter 11 for big corporations. And yet, they have really well advised folks that help fake people, big fake people cancel and restructure nearly all debts. That could be not only loans to banks, but harm from hazardous products, sex abuse of children, employment discrimination, and even police brutality and city cases. So there are a lot of other distinctions that we won't go into right now. But a lot of it is justified. To the extent it's talked about at all as well, in these business cases, these big cases, we need to maximize economic value, just get a deal done. And so moral hazard nevermind.

David Sirota 32:52
I want to ask about this example that you use in your paper, because I think it's really illustrative of what we're talking about here. That there's this example of a guy named Ronald two Mechi, who lost his home. And in the same court, there's the example of Johnson and Johnson, give us a rough sketch of the differences between how this court as an example, treated somebody like Ronald to Mackey, and how they are treating a giant corporation, like Johnson and Johnson, which has been accused of essentially poisoning 10s of 1000s of women with baby powder, talcum powder included carcinogenic ingredients.

Melissa Jacoby 33:41
Yeah, so the first thing we should remember about Johnson and Johnson is that the story is still to be written. So that court just heard the case a couple of weeks ago, but one thing we can be sure of is that they are talking about it in a very different way. And I don't think it's going to look much like the individual that you mentioned, Ronald to Mechi. So Ronald Tamaki only had one asset in his bankruptcy, it was a home he built with his own two hands. And his case got challenged and ultimately thrown out of bankruptcy. Because a trustee a watchdog over the system, which most big business cases do not have thought that he was delaying a divorce so that he didn't have to share some of the value of his home with his creditors. His creditors didn't even complain in the case, just the trustee, but out he weren't it was considered not to be a good faith filing,

David Sirota 34:34
so he doesn't get bankruptcy protection on a $35,000 credit card debt on a home that he built with his own hands, because the bankruptcy trustee the overseer says I think you're not getting divorced in order to try to protect your assets. Okay, so that's how the court treats this guy, Ronald to Mechi. Now the same court, how is it potentially going to treat you Johnson and Johnson a multibillion dollar corporate behemoth being accused of poisoning 10s of 1000s of women.

Melissa Jacoby 35:10
Well, Johnson and Johnson is a really wild example. But it's not alone. And it will definitely not be alone, depending on what happens here. Yes, it had 38,000 claims of allegations that that its products created ovarian cancer or added to ovarian cancer caused ovarian cancer and there was an absolute failure to warn. They're also visit Fili OMA claims. And Johnson and Johnson didn't like the way the jury system was going in state courts and other courts around the country. It said those were lottery like results that real people were ruling on these cases. And so it came up with an idea to put all of its talc liabilities in a separate Corporation, a separate entity, and toss that entity into bankruptcy. But there's a catch Johnson and Johnson wants to protect the entire corporate family, it wants to continue to pay dividends to its own shareholders and use all the profits for other things, and devote some money maybe to these claims, which Johnson and Johnson says there is no validity to, but that put a little bit of money in there. But otherwise, say we can just hedge off or hive off these liabilities. They put the liabilities in bankruptcy, but they've paid everybody else. They're paying their commercial creditors, their shareholders are fine. And so that case has been challenged. And then we'll see.

David Sirota 36:43
So what's amazing here is that I think a lot of folks will hear this and be like, Wait, man, I didn't know Johnson Johnson was was was bankrupt? Well, what are you talking about Johnson and Johnson's a highly profitable company, but they are going into bankruptcy court, or at least they've tried, they've severed off a piece of their company, and had that piece of their company, try to get bankruptcy protections, because the company doesn't want to trust the judicial system juries, the most basic part of our court system to judge whether it did in fact, poison 10s of 1000s of women, and whether it should be liable for that, because I want to talk about this maneuver. How does a company sever itself, there's this thing that's now called the Texas Two Step, tell us about what the Texas Two Step is how it relates to the bankruptcy system?

Melissa Jacoby 37:43
Well, every day new business entities can be born, they also can be terminated. So it takes very little to create new enterprises. And in some states, like Delaware, you have several 100 of new limited liability corporations every day, to do what Johnson and Johnson did require a couple of extra steps. So they had to go back and forth between a couple of states, including Texas, that has some special rules about dividing up companies. And so they have very sophisticated legal advice lawyers who have shopped this idea around to others, and then come up with a company that only has basically the liabilities, some royalty rights, and then a funding agreement where they're supposed to get some money from the bigger company to actually compensate some of these survivors, according to whatever is negotiated behind the scenes. Now, that backdrop of coming up with that company is supposed to make it more likely that it can survive a bankruptcy and that, again, this remains to be seen. I do think it's important that people know that the those who are more accepting of this strategy. Here's the only argument that they sometimes give, that they're trying to do the least worst thing that all the money will otherwise go to paying lawyers and appeals, and it's going to take years and they just want to bring finality to the whole thing. So maybe bankruptcy is a good place for that. Now, I don't personally agree with that. But it becomes it goes back to this economic efficiency argument. And I think that's, that can be very persuasive in courts to say, well, maybe the survivors are better off maybe the victims are better off if we can just cut a deal through mediation in this bankruptcy. So that's sort of some of the dynamics.

David Sirota 39:35
But to go back to the point about regular normal people, and the way they're treated in bankruptcy court versus a fake person, a giant corporation, a regular person cannot cut off their arm and have their arm only go into bankruptcy court. It seems to me that the Texas Two Step where there's this state law that was changed in 1989 to allow companies to divide into two or more entities to basically isolate the profit part of the company from the liable part of the company. That's a good example of a kind of privilege that a fake person has in these courts that a regular person doesn't worth adding. This was pioneered this. This technique was pioneered by Koch Industries, when it used it to shield a subsidiary Georgia Pacific from asbestos claims related to its paper, and its building products. So just to underscore that this maneuver, and Johnson and Johnson being the fourth major company to try it now, this maneuver is another example of a thing that a regular person in bankruptcy court can't utilize. Now, I want to turn to the to the Sacklers for a second here, because it seems to me they're using a different technique. And we're going to run through some of these techniques because they're kind of mind blowing. Seems to me that the Sacklers are of the opioid empire, Purdue pharma, the Purdue Pharma has declared bankruptcy. The Sackler family worth more noting has not declared bankruptcy. But there's this issue in that case, a different issue with what's being called a third party release. This kind of blows my mind as well. Can you tell us about what these third party releases are and how they can potentially shield a billionaire family, from the bankruptcy of its own company, a company accused of poisoning effectively, hundreds of 1000s of people.

Melissa Jacoby 41:40
So in bankruptcy in general, one expects to match obligations with rights and benefits. So typically, the party to get protected to get debt cancellation to get relief is supposed to be the party that's in bankruptcy itself, and certainly for individuals, that's of modest means. So that's the way it works. So both in in Johnson and Johnson wants the same thing that the Sacklers do. They want the benefits of bankruptcy without all of the obligations, they want to cut a deal that says, Okay, we'll put in some money will disclose some information, but we're not subjecting ourselves to be debtors and everything that that goes along with. Now, this is a doctrine that the third party release concept is something that says you can piggyback off of someone else's bankruptcy in rare circumstances. Now, you know, every time you say rare circumstances, you say, Ooh, it's not going to end up being that rare. And that's part of what we're seeing here. We're seeing a creeping growth of the circumstances. Because once upon a time, you'd put the major tortfeasor in the bankruptcy and say, well, there are a couple of people that are sort of associated with this, maybe they should get relief, too. But some of these cases are turning that concept around where the ones that are putting in the most money or who might be most responsible for the harm are staying out of bankruptcy. And this is something we're going to hear any day now. What an appellate court thinks of Purdue Pharma has plan. Now, again, I have to say here, behind the scenes, there was pressure to come up with a deal to have many people who were invited into the negotiating table to say, Okay, we will accept this if a certain amount of money is is is put in. As always, the question is who gets invited to the table? Who speaks for whom? So that's some of the dynamic.

David Sirota 43:43
But just to be clear about what's going on here, the third party releases if I am tell me if I'm wrong here, that the third party releases basically say that if this bankruptcy deal goes through that attorneys general government, law enforcement agencies cannot subsequently prosecute or go after the Sackler family, or cannot in the Johnson and Johnson case cannot go after Johnson and Johnson, because if the bankruptcy deal is essentially blessed by the court, these releases provide a permanent legal shield for any of the potential accusations, potential crimes that we're committed in the past. Is that right?

Melissa Jacoby 44:32
Well, here we do have to distinguish between civil and criminal and the scope of the protection so bankruptcy really, I'm sure people would like to try but if these releases are upheld, it will not prevent criminal liability. The problem is, how difficult it is to pursue that line. And I think there's an expectation that that's not going to happen. That doesn't mean it can't but the bankruptcy would not stop that. However, it is a very significant shield against liability for opioid related accusations. And here, the states were very well represented here. They advocated very strongly for themselves. Not all of them originally came on board. But eventually, many came around most came around. I do one thing that bugs me about the deal here in terms of speaking of real people, again, this opioid family survivors who have so little money to even for burials for medical care for rehab, they're not getting very much money out of this settlement. And yet, there's still a fear that if the deal falls through, they would get even less. And that's always the threat. That's what's going on and making these cases go forward. The idea of, well, if you don't approve this, if we don't do this zeal, the Sacklers are going to hide this money from you for ever. So it's beyond the bankruptcy system, what we have going on here, but it's the bankruptcy system shows this bias and how much protection for the wealthy that our legal systems offer.

David Sirota 46:16
Let's talk now to another abuse of the bankruptcy system or alleged abuse forum shopping. The idea that the corporation declaring bankruptcy can effectively shop for the most friendly court. In the Purdue pharma case, you have a situation where Purdue chose to file its bankruptcy petition in White Plains, New York, where it knew it would receive one of the friendliest receptions available to its argument that Purdue Pharma has bankruptcy should forever shield the Sackler family. You've got a situation in Johnson, the Johnson and Johnson case where it goes to Texas, it splits itself into two, then it goes to North Carolina, then it's in a New Jersey court. Now it's in a Philadelphia court. Why are these entities allowed to just run around the country choosing where they get to have their bankruptcy proceedings heard, rather than having to to file it in the place that they do business?

Melissa Jacoby 47:22
It's a great question. And one that has defied an easy answer. It is an example of when you can continue to create new entities and new fake people, you can manufacture a situation where you could file for bankruptcy almost anywhere in with the Boy Scouts of America, a tiny subsidiary in Delaware was the hook to file that entire case there. So this, this is the fault. This starts with Congress, Congress wrote a very flexible statute many decades ago, I think they expected more cases to be moved around once they were filed. And there are very good reasons that that does not happen. And that's not a reasonable solution. I will say that what people are looking for and what these companies are looking for, of course, they want the best result for their, their their client when the lawyers are plotting out what the options are. But there's also an advantage, not only it's not always that they know how a court will come out. But they're limiting the range of options. So even courts that have a very strong reputation, the Manhattan court has a lot of judges. Now. They're not all of one mind on many things. They could not predict which judge they would get in Manhattan, but they could in White Plains. Now, New York has shifted their local rules so that this situation can't happen again. But I think it's going to take a bigger congressional change, because lawyers are going to do the kind of planning that they think they're entitled to do, then they're getting paid very large sums to do that to do that planning. But don't try that if you're an individual. It doesn't work.

David Sirota 49:13
Right another another example of of what fake people are allowed to do in bankruptcy court that real people aren't. Okay, one last question about the abuses before we get to potential solutions. In the Alex Jones case Alex Jones faces a potential up to a billion dollar in damage in damages in in a judgement about the defamation case about the Sandy Hook shooting. His company is filing for bankruptcy. Bloomberg reports a looming question over that company's bankruptcy is whether damages in a case like that can be discharged, I guess in other words, Whether somebody can be found guilty of defamation in a, in this case in an absolutely horrific way, and then use bankruptcy court to protect them from having to pay out those damages, are those kinds of damages dischargeable in bankruptcy, can you can you get out of having to pay damages from a court ruling like this? Through just saying, Hey, listen, my company is bankrupt. And to be clear, Alex Jones is saying he himself personally, is not declaring bankruptcy,

Melissa Jacoby 50:38
I first need to distinguish the Alex Jones, terrible situation, from some of these other cases in this respect. And tissues, the children's educational shows one of these things is not likely other. So Alex Jones doesn't have access to the elite lawyers that some of the other companies we've talked about, has, that's changed the way these cases have already gone. And it has made it very difficult for those cases to proceed in the way he and his companies have wanted. So I do want to be cautious of how we talk about this. It's very early in those cases. But I'm not persuaded he's going to be able to do the kinds of things that the Sacklers may be able to do. So and I think that's important context, there's been a lot of the case has to have due process. But there have been a lot of rulings already that have suggested that this is not an easy Hill for him to climb for sure. Now, as to what debts can be canceled, now, in general, fake people can, if they can get through a plan they or get through a case, they could cancel pretty much anything even for her rendus torts that they've committed, willful and malicious injury, and that sort of thing. There are a couple wrinkles for Alex Jones and his company that are going to come up here and I think there are going to be other wrinkles they're going to have but here's here's the issue. First of all, I believe that the original judgment in the Connecticut case was a default judgment that it wasn't actually litigated. He didn't come in and fight the allegations. That means that sometimes in when you go into a bankruptcy court, the question is, what kind of deference do you give that judgment? Because it wasn't actually litigated? Do you need to re litigate it up or have more of a trial, which given how much the people who've been through already the Sandy Hook family sounds pretty horrendous. But that's one question. And that's even that's assuming. Well, another wrinkle here. Somewhat oddly, Alex Jones claims that his businesses fit a special set of provisions for small businesses that are supposed to make it easier to reorganize. Now, this is a very recent thing, because typically, small businesses have been been treated more like humans. And way less like say, Johnson and Johnson or Purdue pharma a lot of scrutiny hard to actually restructure that recently changed in 2020. It certainly was not designed for the Alex Jones situation, it was designed for the ice cream shop down the street. But so there's some question about whether this even fits that parameter? If it does, there are some case law percolating that says, Well, maybe a small business is treated more like a human and therefore cannot cancel some of these debts. So sorry to get in the weeds there. But the question sort of demanded it to say there, there really are open questions here about how that liability would be treated. Again, assuming the case even gets gets that far there some real big challenge.

David Sirota 54:15
Let's talk about solutions here. There's a bill before Congress at the lever has reported on called the Sackler act, and that's the first proposed solution to some of this. It would prohibit a bankruptcy court from releasing non debtors from liability for suits brought by government entities. So basically, as I understand it, if an attorney general or the Department of Justice brings a suit against an entity or a set of entities, it's basically saying a court like the white plains court in the Sackler case, can't just say sorry, the Sacklers as a family get to be protected from those civil suits because their company Purdue Pharma is in bankruptcy court. Is that In your mind a a decent solution. And I should mention, by the way, Johnson and Johnson has also been lobbying on this bill, not coincidentally, is that a solution to essentially say to courts, you can't give the out these legal shields to the people behind the entities that are filing for bankruptcy? And I should ask, is there a danger in doing that? Like, what's the devil's advocate argument to not do that?

Melissa Jacoby 55:27
A couple of things there. So on the specifics of that, Bill, David, you rightly pointed out, privileging the government, the government is creditor over other kinds of claimants that itself is quite controversial. Now, I have some sympathy for it. On the one hand, to the extent they're exercising, police and regulatory powers, these are not things that we're supposed to get wrapped up in bankruptcy, it's sometimes it's hard to tell the difference between trying to collect money and police and regulatory power. But there's a real concern, I go back to this, the Sackler in Purdue, the way that the the negotiation on behalf of the families, their survivors of the opioid crisis, Route, who, who have lost so much financially themselves, we're not given as good of a deal as the states. So you are pitting one group of parties against another one group of creditors against another with that particular approach. I do think that because lawyers for big corporations, and very wealthy families are going to continue to push the envelope, something's going to have to happen, Congress is going to step in one day, the Supreme Court might say that many of these things are not even constitutional. What is the office doing in a bankruptcy court, it just doesn't make any sense. So I do think some day of reckoning is, is is coming. And I can guarantee you that the very well connected parts of the restructuring bar, that's the fancy name for very highly paid bankruptcy lawyers, they will be out in force with this, these companies lobbying against that and saying the sky will fall. So here's the devil's advocate. Sometimes this is the only way to get the deal done. We have to resolve all of these integrated liabilities. We can't silo them company by company. That's one of the main arguments that often made. So by banning third party releases. So the argument goes, this will undercut the ability to compensate the very people that you want to help.

David Sirota 57:44
Right. So you're saying the releases are used as a way to entice the debtors or the accused, to come to the negotiating table? Hey, I will agree to give up we the Sacklers will agree to give up X billions dollars, as long as we are now as long as we now have a shield and the I guess the argument is to prevent that from happening, you deter the Sacklers from agreeing to any deal. Now I'm sure people listening to this are like, screw the Sacklers. What Why did they get to dictate the terms of whether they come to the table? They're accused of doing horrible things? Why are they the ones who get to dictate the terms? And I sympathize with that impulse. I sympathize with that idea that it's unacceptable that those billionaires or that Johnson and Johnson or any other huge corporate behemoth gets to dictate the terms. Let's let's, let's turn to the to the question of how to fix the Texas Two Step. This idea that a company can sever part of itself and let only the part of itself that it wants to get rid of get bankruptcy protections and sever the rest of the company from any kind of damages. Is there a way to stop that? Is there legislation is there? What's the way to stop that? Because to me, that's like the end of the world, right? If a company knows that it can abuse 1000s, if not millions of people, and just then when when somebody calls them to account, just sever that part of itself from the rest of its profitable operations, then what there's no deterrent that mean that's like the end of civilization, is there any way to stop it?

Melissa Jacoby 59:28
So it's important to note that none of the Texas Two Step cases that I'm aware of have made it all the way successfully through a bankruptcy. So it remains to be seen whether this this works at all. I believe Senator Warren has a bill that goes to the Texas Two Step but I also think we're framing this issue way too narrowly now. And of civilization. Maybe that's not too narrow. But I think that's really more of the point. Bankruptcy could swap is swallowing the whole world. And so we could have one bill that goes after the two step and another bill that goes after non debtor releases, but the problem is is bigger than that. The problem is the bias in the law. The problem is the protection of wrongdoers. And the problem is that our legal system makes everything about money and relies heavily on litigation and damage awards for money to compensate for a harm, which then feeds right back into this, that's not always the form of remedy that that parties may want. That's not the form of remedy that may do the most to prevent these things in the future. But I think we're going in a vicious cycle here. And you can you can nip one of these things in the bud and the market will come up with a new one. Now, that's not a reason not to try. I'm not one of those don't do anything, because they'll always come up with something else. But I think we need to think bigger about what the problem is, and that these narrow interventions aren't going to be as effective. I think

David Sirota 1:00:56
that's that's a profound point about money, and criminality. And I think that's a good place to end this discussion, which the idea that the government, in lots of cases has decided to use financial punishment against fake people, corporations, that are not people that are immortal, that can that can live forever, that have all these special rights. To my mind, what happened from the financial crisis onward, was this idea that we're not going to actually prosecute individuals, we're not going to shut down companies give companies the death penalty, the last major company, I can remember being given the quote, unquote, death penalty by remember right. The big one was Arthur Andersen, that we were a country that used to prosecute individual wrongdoing. And part of the reason why we did that was the deterrent effect, that if an a corporate executive knows that if they abuse 10s, of 1000s, of people, millions of people, and that they themselves could face personal liability, criminal liability, or at minimum, the company knew that it could face a so called death penalty of pulling its charter killing the company, etc, etc. That was a much bigger deterrent to abusing 1000s or millions of people, then, hey, we may have to pay a fine in the future. That is either a, you know, a rounding error in our corporate earnings, or one that we can now go into a bankruptcy court using something like the Texas Two Step to protect ourselves. So I guess the final question is, is that ultimately where we are right now? Is that why we have these problems? Because the at the 50,000 foot view, that our government entities are not adequately using the criminal enforcement mechanisms, or not adequately using tougher sanctions against companies beyond financial penalties, that we are there because the government isn't doing that, which then allows the bankruptcy system to be used as a shield wrongly in this way? Is that why we're here?

Melissa Jacoby 1:03:18
I'm not sure that's why we're here, it may be a piece of it. My my colleagues who specialize in white collar crime and related criminal issues, I think, are divided on the role of the criminal law system and in deterring wrongdoing by corporate actors. And they'll probably debate that until the end of time as academics do. I would I would broaden the lens again, I think, of course, the government as enforcer of criminal law plays a role. But so much of our legal system actually depends on civil liability and upfront, shaping how people treat each other how careful they are to create the product in the first place, how oversight works all along. And so I do think all of these pieces may it could have deterrent effects. And again, bankruptcy is not directly responsive to criminal liability. We're really talking about the Civil there. But again, it is all of a piece. And there is something going wrong in this legal system that makes big fake people. And again, I don't want to limit it to only for profit corporations, because it can be true for municipalities and big, big nonprofits as well, just less accountable than they need to be and it's hurting a lot of people in different ways. And so bankruptcy is one small piece of this, but I wrote the essay, because it's still an important piece and the more that companies come to bankruptcy as a way to weave their way through this it is not doing its part As part of the project to deter, punish, and rework how companies behave in our society.

David Sirota 1:05:10
Melissa Jacoby is a professor of law at the University of North Carolina, a expert in bankruptcy law. Her article on the ways that the bankruptcy courts treat regular people and fake people differently. We will link to it in the in the description of this episode. Melissa, thank you so much for your time today.

Melissa Jacoby 1:05:31
Thank you, David.

David Sirota 1:05:33
Okay, now our bonus segment just for our paid subscribers. This week, the levers Matthew Cunningham cook spoke with the authors of the new book, our veterans, Suzanne Gordon and Jasper Craven. The book explores the physical, emotional, social, economic and psychological impact of military service on our veterans as they re enter civilian life. Thanks again for being a supporting subscriber. And for funding the work we do here at the lever. Now, here's that bonus segment.

Matthew Cunningham-Cook 1:06:02
Hey, Suzanne and Jasper are so glad to have you here. So yeah, I thought your book was so interesting. And one of the things that I think is most important for people who listen to this podcast, is the fact that the VA is really a framework for imagining the kind of system that we want under Medicare for all, it's a one stop shop where the hospitals are controlled by the public, the doctors are employed by the public, the nurses are employed by the public, every aspect of the system, especially prior to this stage of privatization that you describe, covered every aspect of VA illegible veterans, for who they really were and what they really needed. So that's what I think is so at its core, so important about your book, but I really wanted to hear from you about and I guess starting with Suzanne is kind of how did you get into examining this question of veterans? And what was the impetus for this book, and Jasper, please hop in?

Suzanne Gordon 1:07:08
Well, I've been reading about healthcare for about 35 years or more, and I decided in around 2013, and I wanted to write about the VA Health Care System, because it was a healthcare system. And we don't have a health care system in the United States, we have a health care arrangement, which kind of is even an overstatement. And when I started writing about VA, Health Care and immersing myself in the system, I got to know a lot of veterans because it's the Veterans Health Administration. And then the the the uses and misuses of veterans in our culture, the Fetish with veterans in our culture, that way, we simultaneously bow down to veterans and thank them for their service and so forth. But then when it comes time to putting our money where our mouth is, we don't pay much attention to them and often rescind our promises. It became very clear to me that this was a broader social phenomenon. And my husband, Steve early has written about the labor movement, and for a long time, and so a lot of parallels with veterans and in, in labor, and also and I had been writing with Jasper for years, and about VA issues. And so running the lens to include veterans in a broader sense, you know, what is military culture do to people? What happens to them when they leave this it and then the politics of, of what we now call the veteran space? It was just a logical evolution for I think, me and my two co authors.

Matthew Cunningham-Cook 1:08:58
That's really interesting. Suzanne, Jasper, can you speak to this what what Suzanne just referred to as this misuse of veterans where, and you guys describe this really cogently in the book, this kind of decline of veterans organizations actually advocating for the VA? How did that happen? And what what are your observations around that?

Jasper Craven 1:09:21
Sure. Yeah. Well, you know, for many decades, veterans had some of the most tenacious and effective lobbyists or advocates in these congressionally chartered veteran's service organizations like the VFW or the American Legion. I mean, these are not perfect institutions. I think it needs to be said that the American Legion in particular has a dark history of supporting fascism and white supremacy and it has been very difficult for black veterans and female veterans to enter these institutions. That being said, you know, the American Legion fought like hell to pass the GI Bill to secure free college education for veterans, which is a massive social benefit. You know, these groups also pushed the establishment and strengthening of the Veterans Health Care Administration, which which runs, you know, the nationwide network of VA hospitals, you know, they've they've supported really progressive housing programs, they offer low interest home loans, I mean, a lot of these benefits have come to sort of create what is the strongest social safety net in America. But over the last two decades or so, as these groups have lost members as, as they've struggled to move into online spaces, they've been co opted, some of them by corporate healthcare interests, who have given them a lot of money and sort of shifted their positions on privatization. And they've also become usurped by other ideological groups that are basically astroturf veterans groups that are just trying to shrink government and privatize it. And you know, the most famous example of that is this Koch backed organization called concerned veterans for America.

Matthew Cunningham-Cook 1:11:21
Yeah. And the fascinating thing with CVA right, is that they have, you know, these relatively sophisticated approach to foreign policy questions about like, let's have less kind of veterans in the long road, combining it with this deranged, you know, libertarian approach to the VA. One thing that I you know, you don't touch on too much in your book, but you touch on other components of this is, is so there, you talk a lot about sexual assault. But now we have this whole question of Roe v. Wade being overturned, and the VA really meeting to be this one stop shop for abortion services. For both of you, how do you tie these two questions together this, you know, massive ongoing problem of sexual assault in the military, with this now kind of desperate need for the VA to be a stopgap for providing abortion services, not only to veterans, but also to this fourth mission of serving the public that you you point to?

Suzanne Gordon 1:12:27
Well, I mean, Jasper, I'm sure will have a lot to say about this as well. But I think that the problem is that the privatization forces don't connect the dots in whatever they do. So it's no surprise to us that they don't connect the dots with abortion or fourth mission or whatever. I mean, they, they claim to be pro veteran, and then they want to dismantle the only health care system that studies show over and over again, understands how to take care of veterans, because veterans have very specific problems that private sector providers don't know how to handle and the you know, they claim to be wanting to stop veteran suicide, and then they send that to people who don't even have, you know, in the private sector, a track record on suicide prevention. I mean, I think etiology blinds people to contradictions. And so, you know, the fact that they they're the coasts are spending millions and millions of dollars every year, not only on CVA concerned veterans for America, by non Pacific Research Institute that trashes the VA on all kinds of other think tanks, you know, that don't really think very much about critical issues. And so the the, the failure to the blindness that pervades the the anti VA movement, I think, really makes people blind to the very specific needs of veterans and I think Jasper will probably want to comment more on specifically the abortion issue.

Jasper Craven 1:14:06
Yeah, sure. Well, I mean, I totally agree. And you know, the connection with MST

Matthew Cunningham-Cook 1:14:13
MST MSD being military sexual trauma. Yes. Thank

Jasper Craven 1:14:16
you. Thank you. Yeah, there's a lot of jargon in the military and VA

Matthew Cunningham-Cook 1:14:21
mission, just to reiterate, is when the VA serves the broader public beyond, you know, VA veterans. Yeah, during that. Yeah. Which you could say, you know, there's a national emergency right now, which is in half of the country, you know, women and people with uteruses no longer have access to abortion care.

Jasper Craven 1:14:41
Right, right. Yes. And absolutely. I mean, and so the VA often has to deal with the incredible issues created in the DOD, the sometimes insurmountable issues that that, you know, are making veterans struggle as they transition back to civilian life in profound ways. And the VA, you know, often does a really good job of, of dealing with those issues and healing them. But what is required is leadership. And right now, the VA is is struggling with that because you know, the VA is really the only federal agency that is statutorily allowed to provide abortion services, there have clearly been all of these Republican efforts to codify restrictions of federal funds being used for abortion, but they do not apply to the VA. And if the VA thought creatively about its work and its mission, they could certainly be doing a lot more than they're doing now to provide abortion services. After many months of pitched advocacy, they will finally be providing abortions in cases of rape or incest or when the mother's life is in jeopardy, but they have these incredibly powerful statutes that they have so far refused to fully activate.

Suzanne Gordon 1:15:59
Well, and I also want to add that the way the VA could help women who who need abortions is not simply women, who, who want to want an end to pregnancy, for whatever reason. But in the states where these draconian laws exist, women who have had miscarriages, women who are facing cancer treatment, which could damage a fetus, these women are not being given standard of care by doctors who are, in my view, deeply cowardly, and more concerned, you know, about what can happen to them, and what could happen to the patient. And so there is a true emergency for many women, not just women who've been raped or where the where the pregnancy threatens their lives, but women where the miscarriage threatens, threatens their lives. So I think that this fourth mission of, of serving as a backup to the broader healthcare system in times of national, regional or local emergencies could really be activated around many aspects of the failure to deliver standard of care to women during complex pregnancies.

Matthew Cunningham-Cook 1:17:19
Yeah, that's a great point, Suzanne. Last question. Because we're running low on time, I was wondering if both of you guys could talk about this fascinating example, where you guys basically make the case that, and you've done this in your articles as well, that Eric Shinseki was basically the best member of the Obama cabinet, kind of, you know, committed to VA care committed to the ongoing mission of the VA, who then came under this massive, systematic, coordinated attack, not just from coke backed organizations, but from the New York Times and The Washington Post. And, you know, the all the major media outlets that explain this situation for me kind of in our final few minutes, and how it relates to this broader assault on the VA, because I think it's a really important historical moment. Sure.

Jasper Craven 1:18:11
Well, I was actually in Washington for this moment, it was the summer of 2014. And Bernie Sanders was the chairman of the Senate Veterans Affairs Committee, he was dealing with a Republican House, I was there covering Bernie as a stringer for a Vermont newspaper. And so I very quickly, you know, got my education and how the VA operates. And I saw how Bernie really viewed the agency as sort of the most important proof of concept of some of his broad ideas. And during that summer, basically Republicans in the House along with members of CVA and other ideological forces, used a example at a Phoenix VA Hospital have essentially patients having to wait a few weeks for care. And there being some, you know, scheduling irregularities. They use a single sort of allegation to cast the entire system is broken. This was right before the 2014 midterms. And they were trying to basically suggest that Obama had blood on his hands, young Republican politicians running in key races picked up on this narrative, including Tom Cotton, who was running his first race that year. And, you know, Bernie was really the only one in his party on the right on the left, who was defending Shinseki, who was defending the VA who was pointing to the fact that the the the crush of new patients that was happening in this facility was largely because Shinseki had opened the doors for more Vietnam vets to secure care which everybody had wanted. So clearly, if you're not going to fund the system, once you open up eligibility, there's going to be some some issues. And you know, Shinseki had to take all of this heat much of it unnecessary. The VA itself was badly damaged and public opinion It has never recovered. And so, yes, I mean, I think Shinseki sort of represents maybe the last VA Secretary who really fought for the agency and and had a vision and and you know, since then I think people have been very cautious when they're running the place.

Suzanne Gordon 1:20:15
Yeah. And I think that there's a lesson here for Secretary McDonough, if you would pay attention, because I am very smaller. It was a much smaller number of veterans who, for whom benefits were expanded, we now have the pact Act, which was an act that fortunately passed into spite Republicans temporarily derailing it, and this Act gives new benefits and compensation and health care to something like over 3.5 million veterans who over the decades have been impacted by toxic exposures. And if they don't get their act together to fully staff, the VA, which is a very big gift given the problems that Trump initiated in their hiring and that that Tragically, the Biden administration has continued. Denis McDonough could lose his job to weigh in a way bigger wave. I mean, in the first two weeks of after passage of the pact Act, the VA was inundated with more claims than in its entire history. So I think that they better really start staffing the VA and the veterans benefit the Veterans Health Administration, the better veterans benefited administration really quickly, and they really should up their game about promoting what the Veterans Health Administration and the VBA also does for for not only veterans, but all Americans.

Matthew Cunningham-Cook 1:21:55
Great Again, our veterans, it came out in August from Duke University Press. Fantastic book, highly recommend to all of our listeners out there. Thank you so much for coming on. Jasper and Suzanne, really appreciate it.

Suzanne Gordon 1:22:11
Thank you for having me. If anybody wants to follow our work, they can go to the Veterans Health Care Policy Institute, which is veterans policy.org where we both work. My website is Suzanne gordon.com. Jasper would like to plug his baton Warren.

Jasper Craven 1:22:30
Well, people can follow me on Twitter just at Jasper Craven, I also run a substack newsletter called Battleborn, which you can find there on my Twitter page. And I'm frequently written all around. So that's probably the best place to see my stuff.

Matthew Cunningham-Cook 1:22:43
Yeah, and Jasper and Suzanne have written some excellent articles for the American prospect for our sister publication Jacobin and for Washington Monthly.

David Sirota 1:22:54
That's it for today's show. Thanks a ton for being a paid subscriber to the lever. It's really true we could not do this work without. If you particularly liked this episode, please pitch into our tip jar. The tip jar link is in the episodes description or over at lever news.com/tip jar. Every little bit helps us do this kind of journalism. One last favor. If you liked this podcast and our reporting. Please tell your friends and family about the letter and about the work that we're doing here for them our email, tell them to subscribe at lever news.com The only way independent non corporate media grows is by word of mouth. So we need all the help we can get to continue doing the work we're doing. Until next time, I'm David Sirota keep rocking the boat

Transcribed by https://otter.ai