0:00:01.890,0:00:06.040 >>Male Presenter: I think most people here know Larry Lessig. You should know him either 0:00:06.040,0:00:13.310 from his work at Stanford or Harvard, Creative Commons, helped out the Electronic Frontier 0:00:13.310,0:00:17.260 Foundation, the Sunlight Foundation. There's a whole bunch of places you should know him 0:00:17.260,0:00:17.730 from. 0:00:17.730,0:00:21.960 But really the reason why we wanna pay attention to what he has to say is because he's been 0:00:21.960,0:00:27.220 right on so many issues, whether arguing in front of the Supreme Court, talking about 0:00:27.220,0:00:32.550 things like copyright extension, or--if people noticed a few years ago--he started to move 0:00:32.550,0:00:36.039 away from copyright and started to talk about broader issues. 0:00:36.039,0:00:42.050 Specifically, the influence or potential corruption of money in politics and a lot of institutions 0:00:42.050,0:00:47.050 that are important in the United States. So, I think it's important that we make sure that 0:00:47.050,0:00:52.960 Larry not be a Cassandra. You know, the prophet who could hear the future, but no one would 0:00:52.960,0:00:54.579 ever believe her. 0:00:54.579,0:00:58.280 And so, I think it's important for us to listen to what he's got to say today. Read through 0:00:58.280,0:01:03.089 the book. It's really good. Don't forget to badge in. But also, after the talk, please 0:01:03.089,0:01:07.979 take a little while and ask, "How can we try to make sure that he's not a Cassandra--that 0:01:07.979,0:01:09.470 we do take these issues seriously?" 0:01:09.470,0:01:14.090 Because, I think, the influence of money in politics and in our institutions is probably 0:01:14.090,0:01:19.360 the most important issue facing us today in the United States. So with that, thanks very 0:01:19.360,0:01:21.310 much to Larry Lessig. 0:01:21.310,0:01:22.590 [applause] 0:01:22.590,0:01:34.700 >>Lawrence Lessig: Thank, Matt. And it's great to be back. I have one sacred text. "There 0:01:34.700,0:01:42.200 are a thousand hacking at the branches of evil." Henry David Thoreau, 1846, on Walden. 0:01:42.200,0:01:50.619 There are a thousand hacking at the branches of evil to one who is striking at the roots. 0:01:50.619,0:01:57.320 Imagine a letter written by a young woman. "There were two clocks regulating our life--the 0:01:57.320,0:02:05.219 one on the wall and the one in the bottle. We built our life around those clocks. He 0:02:05.219,0:02:07.420 slept late so mornings were bliss. 0:02:07.420,0:02:13.140 “We could play and laugh without fear. But at some point, he would awake. And soon after 0:02:13.140,0:02:19.390 he woke, the bottle was opened. And then the older the day grew, the more terrifying my 0:02:19.390,0:02:24.360 life became. He was happy at first--just before dinner, the most happy. 0:02:24.360,0:02:28.290 “That's the only time I spoke to him, a moment to pretend I had a father who had a 0:02:28.290,0:02:33.269 feeling of love. He'd smile. He'd laugh. But then, he'd grow irritated. And by the end 0:02:33.269,0:02:38.900 of dinner, he was angry and if we weren't gone--usually just hiding in our room by nine--he'd 0:02:38.900,0:02:42.190 be violent. He hit me more than once. 0:02:42.190,0:02:46.349 “Once he tried to do something worse than hitting me and then I left and I never went 0:02:46.349,0:02:54.659 back. We struggled to do many things in that house to keep food in the house, to keep the 0:02:54.659,0:03:02.440 winter out of the house, to keep the house. But the one thing we never even spoke about 0:03:02.440,0:03:04.299 was getting him to stop. 0:03:04.299,0:03:10.560 “I don't know why. The bottle was just part of our life. We learned to live with it. Anything 0:03:10.560,0:03:22.040 more just seemed impossible." Now, the thing about us--we humans--is that we adapt, we 0:03:22.040,0:03:24.909 adjust, we learn to live with it until we can't. 0:03:24.909,0:03:31.330 And then a certain fever breaks out and if we're lucky, we have this Thoreauvian moment--a 0:03:31.330,0:03:37.299 recognition that we have to stop hacking at the branches and start striking at the roots, 0:03:37.299,0:03:44.189 the recognition that we have to become this sense of a root striker. OK. So, here's the 0:03:44.189,0:03:45.959 argument here. 0:03:45.959,0:03:52.379 I think that there's this feeling among too many of us Americans that we just might not 0:03:52.379,0:03:57.239 make it. Not that the end is near or that doom is around the corner, but that a distinctly 0:03:57.239,0:04:04.349 American feeling of inevitability of greatness, culturally, economically, politically, is 0:04:04.349,0:04:10.060 gone--that we have become Britain or Rome or Greece. 0:04:10.060,0:04:16.579 A generation ago, Ronald Reagan rallied the nation to deny a similar charge: Jimmy Carter's 0:04:16.579,0:04:22.000 fear that we had fallen into a state of malaise. And I confess. I was one of those so rallied 0:04:22.000,0:04:28.450 and I still believe Reagan was right today. But the feeling I'm talking about today is 0:04:28.450,0:04:28.940 different. 0:04:28.940,0:04:35.950 Not that we, as a people, have lost anything of our potential, but that we, as a Republic, 0:04:35.950,0:04:44.510 have. That our capacity for governing, the one thing that we were once most proud of, 0:04:44.510,0:04:49.510 this our Republic, is the one thing that we have all learned to ignore. Government is 0:04:49.510,0:04:52.330 an embarrassment. 0:04:52.330,0:04:57.610 And it has lost the capacity to make the most essential decisions and slowly it dawns upon 0:04:57.610,0:05:03.960 us that a ship that cannot be steered is a ship that will sink. This is not a Democratic 0:05:03.960,0:05:10.090 or Republican point alone. This is a genuinely multi-partisan frustration. 0:05:10.090,0:05:14.120 The sense that the government doesn't work is signaled by many different policy areas 0:05:14.120,0:05:20.500 on the left and the right, which systematically get blocked. And when confronted with this 0:05:20.500,0:05:27.530 systematic block, my suggestion is we need to exercise this Thoreauvian insight. So, 0:05:27.530,0:05:31.970 my objective this afternoon is to do a little bit of brainwashing. 0:05:31.970,0:05:32.930 [laughter] 0:05:32.930,0:05:38.440 To get you to the place that you see the roots that I want you to see. I'm gonna do that 0:05:38.440,0:05:42.590 with three some examples. One of them is familiar. Indeed, I told a similar story here the last 0:05:42.590,0:05:46.140 time I was here--the story around copyright. 0:05:46.140,0:05:52.280 On October 27th, 1998, I became a copyright activist the day President Clinton signed 0:05:52.280,0:05:59.100 into law a statute in honor of this great American, the Sonny Bono Copyright Term Extension 0:05:59.100,0:06:05.310 Act--a statute which extended the term of existing copyrights by 20 years. 0:06:05.310,0:06:09.920 Now, the question Congress was supposed to be asking when it passed that statute was, 0:06:09.920,0:06:16.520 "Would it advance the public good to extend the term of an existing copyright by 20 years?" 0:06:16.520,0:06:21.110 Copyrights are designed to create incentives, but we know about this universe. Put aside 0:06:21.110,0:06:22.110 Star Trek for a moment. 0:06:22.110,0:06:28.260 What we know about this universe is that its incentives are prospective. So, not even the 0:06:28.260,0:06:33.570 United States Congress can get George Gershwin to produce anything more. 0:06:33.570,0:06:34.440 [laughter] 0:06:34.440,0:06:38.030 So when you ask the question, "Does it make sense to advance the public good to extend 0:06:38.030,0:06:41.690 the term of existing copyright?" it's a pretty easy answer. Indeed, when we challenged this 0:06:41.690,0:06:46.650 statute in the Supreme Court and a bunch of economists wanted to sign a brief saying it 0:06:46.650,0:06:49.520 did not advance the public good, this liberal, left-wing--. 0:06:49.520,0:06:57.090 Oh, I'm sorry. Wait. This is Milton Friedman--right-wing, Nobel Prize winning economist, agreed to sign 0:06:57.090,0:07:01.930 the brief but only if the word "no brainer" was in the brief somewhere. 0:07:01.930,0:07:03.180 [laughter] 0:07:03.180,0:07:08.490 So obvious was it that you could not extend the public good by extending the term of existing 0:07:08.490,0:07:15.160 copyrights. But apparently there were no brains in this place when Congress unanimously extended 0:07:15.160,0:07:17.370 the term of these existing copyrights. 0:07:17.370,0:07:22.930 What there was, was more than six million dollars in contributions from Disney and related 0:07:22.930,0:07:28.030 corporations seeking the extension of their valuable copyrights--the public be damned. 0:07:28.030,0:07:32.280 Here's another example. Wall Street Journal, at the end of last year, was puzzled about 0:07:32.280,0:07:37.430 the explosion of temporary tax provisions in our tax code. 0:07:37.430,0:07:41.440 These temporary tax provisions expire after a limited period of time. And that leads to 0:07:41.440,0:07:48.110 this extender mania, as lobbyists and Congress race around to try to extend the particular 0:07:48.110,0:07:53.720 tax provision for another period of time. And the Journal wondered what explains the 0:07:53.720,0:07:57.730 explosion and change in the number of these extensions. 0:07:57.730,0:08:04.780 Well, it turns out the first of these temporary provisions was given to us by Reagan in 1981. 0:08:04.780,0:08:09.290 Congress passed the Research and Development Tax Credit. But because the Democrats were 0:08:09.290,0:08:13.480 skeptical about whether it would work, they made the tax credit temporary. 0:08:13.480,0:08:16.980 They said they would test it after a number of years. And if it turned out it worked, 0:08:16.980,0:08:20.990 they would make it permanent. If it didn't work, they would repeal it. So, after a couple 0:08:20.990,0:08:24.640 years, the economists asked the question, "Did it work?" The answer is yes. Left and 0:08:24.640,0:08:28.940 right economists all agreed that it did work. It was a great tax idea. 0:08:28.940,0:08:32.719 It spurred a kind of investment that otherwise would not have been spurred. And so, it made 0:08:32.719,0:08:38.610 sense absolutely to make this part of the tax code. Here's the puzzle. It is still temporary 0:08:38.610,0:08:40.669 to this day. Why? 0:08:40.669,0:08:45.660 Well, as Rebecca Kysar describes in this piece in the Georgia Law Review, "The principle 0:08:45.660,0:08:51.240 recipients of the research credit are large US manufacturing corporations. These business 0:08:51.240,0:08:56.320 entities are more than willing to invest in lobbying activities and campaign donations 0:08:56.320,0:09:00.960 to ensure the continuance of this large tax savings." 0:09:00.960,0:09:04.880 The Institute for Policy Innovation put it a little bit more sharply. "This cycle has 0:09:04.880,0:09:09.560 repeated for years. Congress allows the credit to lapse until another short extension is 0:09:09.560,0:09:14.060 given. Proceeded, of course, by a series of fundraisers and speeches about the importance 0:09:14.060,0:09:16.020 of nurturing innovation. 0:09:16.020,0:09:21.600 Congress essentially uses the cycle to raise money for re-election, promising industry 0:09:21.600,0:09:28.750 more predictability the next time around." Now this dynamic is central to how Washington 0:09:28.750,0:09:36.820 works. We architect tax policy in part, at least, not just to raise money for our treasury, 0:09:36.820,0:09:42.460 but to make it easier to raise money for our Congressmen's campaigns. 0:09:42.460,0:09:47.660 And not just tax policy. When Al Gore was Vice President, he had an idea to simplify 0:09:47.660,0:09:53.730 the regulation governing infrastructure that internet would come across. Right now, we 0:09:53.730,0:09:59.140 have two titles in the Communications Act--Title Two and Title Six. Title Two governs telephones. 0:09:59.140,0:10:03.750 Title Six governs cable. Those are two radically different regulatory structures. Gore's idea 0:10:03.750,0:10:08.940 was to put them together in a Title Seven and fundamentally deregulate them--much less 0:10:08.940,0:10:11.930 than even network neutrality regulation would require. 0:10:11.930,0:10:16.110 His team took the idea to Capitol Hill and the chief policy person described--the reaction, 0:10:16.110,0:10:22.860 he said the reaction was quote, "Hell no. If we deregulate these guys, how are we going 0:10:22.860,0:10:29.030 to raise money from them?" And you get this kind of sinking, terrifying feeling here, 0:10:29.030,0:10:29.440 right? 0:10:29.440,0:10:35.570 Recognizing that we tax in part to make it easy to raise campaign funds. We regulate, 0:10:35.570,0:10:41.880 in part, to make it easier to raise campaign funds. Campaign funds driving critical areas 0:10:41.880,0:10:48.070 of fiscal policy unrelated to the merits of the underlying fiscal policy. Here's the third 0:10:48.070,0:10:48.200 example. 0:10:48.200,0:10:52.330 Think about Wall Street. We've of course seen this collapse on Wall Street, which triggered 0:10:52.330,0:10:57.080 a collapse in the economy. What explains that collapse? Well, as Simon Johnson and James 0:10:57.080,0:11:03.240 Kwak describe in their book, "13 Bankers," part of the explanation is this perverse mix 0:11:03.240,0:11:06.430 of too little government and too much government. 0:11:06.430,0:11:13.650 Too little government in the form of deregulation. In the 1990s, we saw an explosion of financial 0:11:13.650,0:11:19.470 innovations, derivatives. But these innovations were essentially invisible to the market because 0:11:19.470,0:11:25.980 a series of regulatory changes in the 1990s made derivatives, unlike other financial assets, 0:11:25.980,0:11:30.670 not subject to the standard requirements that have existed since the new deal that they 0:11:30.670,0:11:38.070 be traded on public exchanges, transparently with anti-fraud obligations tied to every 0:11:38.070,0:11:39.260 transaction. 0:11:39.260,0:11:46.140 So, my colleague, Frank Partnoy, calculated that in 1980, 98 percent of assets traded 0:11:46.140,0:11:55.420 in our economy were traded under these standard new deal, trade-based rules. But by 2008, 0:11:55.420,0:12:03.340 90 percent of the assets traded in our economy were exempted from these exchange-based rules, 0:12:03.340,0:12:07.310 could be traded without transparency, could be traded without anybody knowing what the 0:12:07.310,0:12:08.630 prices would be for. 0:12:08.630,0:12:12.710 It could be traded without any anti-fraud requirements being tied to them, producing 0:12:12.710,0:12:18.529 this shadow banking market, which encouraged--because of the uncertainty it spewed everywhere--the 0:12:18.529,0:12:23.730 bubble which eventually burst and brought the economy down. But that alone, Kwak and 0:12:23.730,0:12:28.430 Johnson say, wasn't enough. In addition, we had too much government. 0:12:28.430,0:12:34.170 Throughout the 1990s, there was a beacon, a constant signal from the government that 0:12:34.170,0:12:38.920 there was, in effect, a government guarantee that when this bubble burst there would be 0:12:38.920,0:12:45.220 a bailout on the other side producing what is the dumbest form of socialism ever invented 0:12:45.220,0:12:49.940 by man--socialized risk and privatized benefit. 0:12:49.940,0:12:56.670 We suffer the downside. They get the upside. Now I know you guys are not lawyers. This 0:12:56.670,0:13:01.600 is a technical legal term, but this is an insanely stupid way-- 0:13:01.600,0:13:02.910 [laughter] 0:13:02.910,0:13:08.220 to set up a financial system. And all that stupidity is just before 2008. Even worse 0:13:08.220,0:13:15.310 is after 2008, where we add insult to injury in the way that Congress increasingly functions. 0:13:15.310,0:13:21.100 Because after 2008, after the worst crisis since the Depression, after all who are not 0:13:21.100,0:13:26.170 involved in that crisis had concluded that one of the principle causes to that crisis 0:13:26.170,0:13:31.740 was the architecture of deregulation that Wall Street had purchased until 2008, after 0:13:31.740,0:13:37.270 the dean of deregulation, the Ayn Rand-ian, Alan Greenspan, Head of the Fed, confessed 0:13:37.270,0:13:41.710 in testimony to Congress that he was quote "mistaken" about whether the banks would act 0:13:41.710,0:13:45.120 in the public interest as opposed to their private interest. 0:13:45.120,0:13:51.620 After all of that, Wall Street was still powerful enough to blackmail the Democrats and Republicans 0:13:51.620,0:13:59.410 both to give them an essential "get out of jail free" card and to keep the core flaw 0:13:59.410,0:14:02.630 of our architecture of regulation the same. 0:14:02.630,0:14:09.550 If the banks were too big to fail before 2008, the banks are only too bigger to fail after 0:14:09.550,0:14:15.839 2008, leading many Independents of Wall Street to include that our risk of a collapse is 0:14:15.839,0:14:21.850 greater today than it was before the collapse in 2008. Again, why? What would explain this 0:14:21.850,0:14:23.770 stupidity in the architecture of regulation? 0:14:23.770,0:14:27.620 Well, lots of possible reasons, but here's the one thing we know. The fastest growing 0:14:27.620,0:14:35.860 sector in campaign contributions since 1991, and the largest chunk of contributions in 0:14:35.860,0:14:41.529 the 2010 election, come from the finance and insurance industries. OK. Here's one final 0:14:41.529,0:14:41.980 example. 0:14:41.980,0:14:45.980 I'm sure many of you, when you saw these images, had a question in the back of your head. How 0:14:45.980,0:14:52.800 was it that it's possible to launch such an experimental drilling platform, as the Deepwater 0:14:52.800,0:14:56.850 Horizon, without extensive environmental impact and risk studies? 0:14:56.850,0:15:04.089 All right. In my part of the country, we've just spent nine years and ten thousand pages 0:15:04.089,0:15:09.870 of environmental impact studies to permit the construction of this green energy technology. 0:15:09.870,0:15:15.279 So, exactly how much was required before they were able to build the experimental deep water 0:15:15.279,0:15:17.910 drilling platform, which was the Deepwater Horizon? 0:15:17.910,0:15:26.050 The answer is 17 pages before they were exempted from any further need for review, leading 0:15:26.050,0:15:28.690 Congress to be shocked of course. 0:15:28.690,0:15:35.170 [plays video clip] >>Male #1: I am shocked--shocked--to find 0:15:35.170,0:15:35.250 that gambling is going on in here. 0:15:35.250,0:15:35.250 >>Male #2: Your winnings, sir. 0:15:35.250,0:15:35.250 >>Male #1: Thank you very much. Everybody out in front. 0:15:35.250,0:15:35.250 [laughter] 0:15:35.250,0:15:35.250 [end video clip] 0:15:35.250,0:15:39.190 >>Lawrence Lessig: And of course, it was Congress that had required these fast track approval 0:15:39.190,0:15:44.399 processes, leading again to the question, "What would ever convince them that fast track 0:15:44.399,0:15:49.200 approval on experimental drilling wells made sense?" Lots of possible answers to that question. 0:15:49.200,0:15:53.490 The one thing we know is endless campaign cash driving to this conclusion. Now, here's 0:15:53.490,0:16:02.930 the point. No respectable Liberal or Libertarian or Conservative could defend these cases. 0:16:02.930,0:16:08.810 Each of them is an abomination from each of those three political philosophy perspectives. 0:16:08.810,0:16:14.060 So, how is it they become policy in the United States? Now, it turns out political sciences 0:16:14.060,0:16:19.200 are uncertain. They say it's a little bit complex. But here's the thing. You believe 0:16:19.200,0:16:25.279 you know. I just had to point to point to the money. And you believe you now know the 0:16:25.279,0:16:28.950 root cause to this stupidity. 0:16:28.950,0:16:33.740 And that's the core of my claim. Number one, it is because of cases like this, and I could 0:16:33.740,0:16:39.390 go on for hours, I promise--millions of cases like this--that Americans believe money buys 0:16:39.390,0:16:44.440 results in Congress. Seventy-five percent of Americans in a poll that we conducted for 0:16:44.440,0:16:47.740 my book conclude money buys results in Congress. 0:16:47.740,0:16:50.180 You think, "What were the 25 percent thinking?" I don't know. 0:16:50.180,0:16:50.480 [laughter] 0:16:50.480,0:16:56.570 But a little bit more Democrats than Republicans. But I guarantee you when the Republicans were 0:16:56.570,0:17:01.480 not in control, it was just as many Republicans as Democrats. So, whether it's two-thirds 0:17:01.480,0:17:06.069 or three-fourths, here's the thing we Americans all agree about. 0:17:06.069,0:17:12.800 Money buys results in Congress. Leading to number two. A belief in money buying results 0:17:12.800,0:17:19.110 erodes trust in the institution. So, last year Gallup concluded that eleven percent 0:17:19.110,0:17:25.520 of Americans have confidence in Congress. Gallup's number this year is a little more 0:17:25.520,0:17:28.079 optimistic. They say 12 percent. 0:17:28.079,0:17:28.600 [laughter] 0:17:28.600,0:17:33.590 But I just read today in the New York Times--New York Times CBS poll says that nine percent 0:17:33.590,0:17:39.490 of Americans have confidence in Congress. To keep this in some context, right, it is 0:17:39.490,0:17:44.670 certainly the case that there were more people who believed in the British crown at the time 0:17:44.670,0:17:48.530 of the Revolution than believe in our Congress today. 0:17:48.530,0:17:49.030 [laughter] 0:17:49.030,0:17:54.660 And at what point does an institution have to declare political bankruptcy? At what point 0:17:54.660,0:17:59.300 has it just lost the credibility with the people? What, nine percent isn't enough? Five 0:17:59.300,0:18:05.520 percent? What is the number when we have to say there is no more confidence in this government? 0:18:05.520,0:18:10.270 And that leads to number three. Low trust erodes participation in the system. Rock the 0:18:10.270,0:18:14.230 Vote, the organization that registered and turned out to vote the largest number of young 0:18:14.230,0:18:19.720 people who ever voted in the history of this nation, and arguably delivered the election 0:18:19.720,0:18:24.880 to Barack Obama, in 2010, found a large number of their voters were not gonna turn out and 0:18:24.880,0:18:25.210 vote. 0:18:25.210,0:18:29.980 So, they polled them. Why? Number one answer to that poll by far--two to one over the second 0:18:29.980,0:18:34.860 highest--was "no matter who wins, corporate interest will still have too much power and 0:18:34.860,0:18:40.160 prevent real change." And it's not just kids who think this. The vast majority of people, 0:18:40.160,0:18:45.460 who could have voted, didn't vote and didn't vote in part because of this belief precisely. 0:18:45.460,0:18:50.480 Now here, I'm gonna shift into professor mode. Here's my blackboard. It wasn't supposed to 0:18:50.480,0:18:57.100 be this way. That wasn't the intent. Framers of our Constitution gave us, as Conservatives 0:18:57.100,0:19:04.330 like to remind us, a Republic. But what they meant by a Republic was a quote "representative 0:19:04.330,0:19:05.809 democracy." 0:19:05.809,0:19:10.260 And what they meant by a representative democracy as Federalist 52 puts it was, "a government 0:19:10.260,0:19:17.530 that would have a branch quote 'dependent upon the people alone.'" OK? So, here's the 0:19:17.530,0:19:21.510 model of government. We have the people. We have the government. I do my own slides, so 0:19:21.510,0:19:23.570 it's cool the way that bounces, right? 0:19:23.570,0:19:23.900 [laughter] 0:19:23.900,0:19:29.240 The people, the government, marionette relationship between the two. Here's the problem. Congress 0:19:29.240,0:19:34.580 has evolved a different dependence. It's not just the people and the government. Increasingly, 0:19:34.580,0:19:37.670 it's the funders and the people and the government. 0:19:37.670,0:19:43.900 In a world where members spend between 30 and 70 percent of their time raising money 0:19:43.900,0:19:49.370 to get back to Congress, or to get their Party back into power--they can't help, like each 0:19:49.370,0:19:56.460 of you couldn't help--developing a sixth sense, a constant awareness about how what they do 0:19:56.460,0:19:59.380 might affect their ability to raise money. 0:19:59.380,0:20:04.540 In the words of the "X-Files," they become shape-shifters, constantly adjusting their 0:20:04.540,0:20:09.710 positions. Not on issues one to ten, but issue eleven to five hundred in light of what they 0:20:09.710,0:20:14.670 know will raise money. Leslie Byrne describes it when she came to Congress. She's a Democrat 0:20:14.670,0:20:15.309 from Virginia. 0:20:15.309,0:20:21.010 She was told by a colleague quote, "Always lean to the green." And then to clarify, she 0:20:21.010,0:20:23.380 went on, "he was not an environmentalist." 0:20:23.380,0:20:24.950 [laughter] 0:20:24.950,0:20:35.030 Now, the point is this a dependence, too. But it's a different and conflicting dependence 0:20:35.030,0:20:44.230 from a dependence upon the people alone because--surprise, surprise--the funders are not the people. 0:20:44.230,0:20:50.240 Indeed, candidates pay attention in campaigns most to those who max out in the campaign. 0:20:50.240,0:20:55.150 So, what percentage of Americans maxed out in 2010 in congressional elections in either 0:20:55.150,0:21:02.480 of the two cycles? The answer is point zero five percent of Americans. So, the Occupy 0:21:02.480,0:21:06.730 Wall Street people are so proud of their slogan, "We are the 99 percent." Bad marketing. They 0:21:06.730,0:21:09.640 are the 99 point nine five percent,-- 0:21:09.640,0:21:10.460 [laughter] 0:21:10.460,0:21:15.799 who don't get listened to because they are not in the point zero five percent of people 0:21:15.799,0:21:21.299 who are directly tied into the influence that is our government. Now, this is--Supreme Court 0:21:21.299,0:21:24.100 doesn't recognize this yet, but you should. 0:21:24.100,0:21:31.299 This is corruption. It's not the corruption of brown paper bags secreting cash among members 0:21:31.299,0:21:36.640 of Congress. Up through the middle of the 20th Century, members of Congress had safes 0:21:36.640,0:21:41.540 in their office for cash. You think to yourselves, "I didn't know that they paid Congressmen 0:21:41.540,0:21:43.190 in cash." They didn't. 0:21:43.190,0:21:43.559 [laughter] 0:21:43.559,0:21:47.340 They just discovered that there would be cash on their desk and they needed a place to keep 0:21:47.340,0:21:52.390 it. [laughter] So, that was the way things were. But that's not the problem today. Our 0:21:52.390,0:21:56.830 Congress, in that sense, is the cleanest Congress in the history of Congress. It's not filled 0:21:56.830,0:21:58.220 with Rod Blagojeviches. 0:21:58.220,0:22:02.580 It's not filled with people who are violating any law. None of the corruption I'm talking 0:22:02.580,0:22:10.540 about is illegal. It's all legal, in plain sight. But it is corruption because it's relative 0:22:10.540,0:22:16.590 to the baseline the framers gave us of the dependence upon the people alone. We have 0:22:16.590,0:22:19.070 corrupted that dependence. 0:22:19.070,0:22:23.860 It is a dependence corruption because the wrong dependence has been allowed to step 0:22:23.860,0:22:29.670 into the middle of this system. So then, what does the corruption do? How does it affect 0:22:29.670,0:22:35.590 the results? Well, you can think about its effect in substance. But it turns out, interestingly, 0:22:35.590,0:22:41.470 bizarrely, but interestingly, this controversy about whether it affects the results. 0:22:41.470,0:22:47.210 There's some people who believe it doesn't affect the results. Indeed, the former Chairman 0:22:47.210,0:22:54.700 of the Federal Election Commission, Bradley Smith--I quote in his book, said this. "The 0:22:54.700,0:22:59.700 evidence is pretty overwhelming that money does not play much of a role in what goes 0:22:59.700,0:23:04.140 on in terms of legislative voting patterns and legislative behavior. 0:23:04.140,0:23:09.590 The consensus about that among people who have studied it, is roughly the same as the 0:23:09.590,0:23:13.540 consensus among scientists that global warming is taking place." 0:23:13.540,0:23:14.410 [laughter] 0:23:14.410,0:23:21.000 Now, to be clear, Bradley Smith is not a global warming denier. He is a corruption denier. 0:23:21.000,0:23:24.020 And he said this--we were on in interview on the radio. I just couldn't believe it. 0:23:24.020,0:23:27.410 I had to tweet it. But then I got in a lot of trouble for this hash tag. 0:23:27.410,0:23:27.640 [laughter] 0:23:27.640,0:23:30.190 But of course, that hash tag just means Bradley Smith-- 0:23:30.190,0:23:30.570 [laughter] 0:23:30.570,0:23:37.490 just talking about--. OK. So, do we have evidence that the results are a function of the money? 0:23:37.490,0:23:41.360 Well, there's lots of recent studies that are beginning to make this absolutely compelling. 0:23:41.360,0:23:45.460 One of my favorites is this piece by Clayton Peoples that looks at seven thousand votes 0:23:45.460,0:23:47.559 over a period of 1991 to 2006. 0:23:47.559,0:23:52.740 It concludes, can show a statistically significant contributor influence in at least seven of 0:23:52.740,0:23:57.730 the eight Houses. The one House you couldn't show it was the House that passed the McCain-Feingold 0:23:57.730,0:24:03.020 Campaign Reform Act. So they were thinking good in that one term, but not any other period. 0:24:03.020,0:24:07.679 But I think more interesting is this piece by Martin Gilens at Princeton. Gilens took 0:24:07.679,0:24:13.580 about 17 hundred public opinion surveys about attitudes about how policy should change. 0:24:13.580,0:24:19.700 And he narrowed that down to about 887, where the attitudes of the top ten percent were 0:24:19.700,0:24:22.400 different from the attitudes of the bottom 90 percent. 0:24:22.400,0:24:27.929 And he asked the question, "When the top ten percent think we should go left, and the bottom 0:24:27.929,0:24:31.330 90 percent think we should go right"-- I don't mean that left and right politically. I just 0:24:31.330,0:24:34.919 mean go one direction and the other wanna go the other direction. "--which way do we 0:24:34.919,0:24:35.710 go?" 0:24:35.710,0:24:41.429 And what he found was "when Americans with different income levels differ in their policy 0:24:41.429,0:24:47.130 preferences, actual policy outcomes strongly reflect the preferences of the most affluent, 0:24:47.130,0:24:53.480 but bare virtually no relationship to the preferences of the poor or middle income Americans." 0:24:53.480,0:24:59.929 There is a vast discrepancy between what our Congress does if it in fact were following 0:24:59.929,0:25:05.320 the people alone, and what our Congress does given that it's following the thing I'm taking 0:25:05.320,0:25:09.700 for as the proxy for the funders. OK. That's substance. 0:25:09.700,0:25:14.140 But here, you can also just more easily identify agenda because remember, Brad Smith also said 0:25:14.140,0:25:19.010 it doesn't affect legislative behavior. And here, there is no basis for suggesting it 0:25:19.010,0:25:22.610 doesn't affect legislative behavior. Here's just one example. If I asked you, "What was 0:25:22.610,0:25:28.679 the number one issue Congress spent its time on in the first four months of this year?" 0:25:28.679,0:25:33.700 It's felt like many years this year, but just the first four months. We're in the middle 0:25:33.700,0:25:39.570 of two wars, huge unemployment problems, huge budget deficit problems. Still have a bunch 0:25:39.570,0:25:42.770 of questions around health care and still have a bunch of questions around global warming 0:25:42.770,0:25:44.440 that have not even begun to be addressed. 0:25:44.440,0:25:49.090 What was the issue they spent most of their time dealing with? The answer is the bank 0:25:49.090,0:25:54.330 swipe fee controversy. Now, what's the bank swipe fee controversy? Well, the bank swipe 0:25:54.330,0:25:58.470 fee controversy is whether banks, when you used your debit card, get to charge more, 0:25:58.470,0:26:02.840 or retailers when you use your debit card get to be charged less for the use of debit 0:26:02.840,0:26:03.750 cards. 0:26:03.750,0:26:08.610 That is the critical national issue that dominated the Congressional agenda for the first four 0:26:08.610,0:26:12.440 months. And you think, "Well, why would that ever be? Why would swipe fees be the center 0:26:12.440,0:26:13.320 of what they care about?" 0:26:13.320,0:26:18.049 How many members of Congress got elected going down there saying, "The thing I'm going for 0:26:18.049,0:26:22.660 is to deal with that swipe fee controversy." Right? Well, the answer is one Senator described 0:26:22.660,0:26:26.510 it like this. "The fights down here can be put into two or three categories: The big 0:26:26.510,0:26:31.340 greedy bastards against the big greedy bastards; the big greedy bastards against the little 0:26:31.340,0:26:36.059 greedy bastards; and some cases even the other little greedy bastards against the other little 0:26:36.059,0:26:37.710 greedy bastards." 0:26:37.710,0:26:38.330 [laughter] 0:26:38.330,0:26:42.000 So we have this kind of controversy. And here's the money line, so to speak. I don't even 0:26:42.000,0:26:47.520 think the authors, Zach Carter and Ryan Grimm, saw the significance of this, but this is 0:26:47.520,0:26:49.040 the real money line in the piece. 0:26:49.040,0:26:54.000 They say, "The clock never ticks down to zero in Washington: one year's law is the next 0:26:54.000,0:26:59.860 year's repeal target. Politicians, showered with cash from card companies and giant retailers 0:26:59.860,0:27:06.100 alike, have been moving back and forth between camps, paid handsomely for their shifting 0:27:06.100,0:27:06.770 allegiances." 0:27:06.770,0:27:13.150 So, it's not just tax policy that gets architected to raise money for members of Congress. It's 0:27:13.150,0:27:17.760 not just regulation that gets architected to make it easy to raise money for members 0:27:17.760,0:27:22.799 of Congress. It's the very agenda of what Congress addresses that gets set in a way 0:27:22.799,0:27:25.770 to make it easier for members to raise money. 0:27:25.770,0:27:30.250 So why don't we address unemployment? Turns out unemployment doesn't pay so well [laughter] 0:27:30.250,0:27:35.840 for Congressmen raising money for their campaigns. Now, my view is we critically need a way to 0:27:35.840,0:27:41.220 change this. And we change this by fixing the dependence. If the problem here is that 0:27:41.220,0:27:48.870 the funders are not the people, a solution is to make the funders the people, to give 0:27:48.870,0:27:49.330 them a way--. 0:27:49.330,0:27:54.660 I know that looks like one word. I mean two words, here. I don't mean give Congress away. 0:27:54.660,0:27:59.410 I know a lot of people would like to do that. I mean, give Congress a way to fund their 0:27:59.410,0:28:05.740 campaigns without Faust, without selling their souls, and thereby without alienating America. 0:28:05.740,0:28:10.390 And the one way, and I increasing think the only way to do this, is to commit to a system 0:28:10.390,0:28:15.890 of publicly funding public elections. Now, a particular brand of public funding is what 0:28:15.890,0:28:21.809 I want to pedal here. I want a public funding that changes from large-dollar funded campaigns 0:28:21.809,0:28:23.610 to small-dollar funded campaigns. 0:28:23.610,0:28:28.700 And there are lots of examples of this around the country. Three states in particular, Arizona, 0:28:28.700,0:28:34.419 Maine, and Connecticut, have systems where candidates opt into a regime where they take 0:28:34.419,0:28:40.150 small dollar contributions only and the regime effectively amplifies those contributions, 0:28:40.150,0:28:45.220 so that they can successfully wage a campaign having never taken a large dollar contribution 0:28:45.220,0:28:45.940 from anybody. 0:28:45.940,0:28:50.289 There are many ways to do that. I describe one in my book that's a little different from 0:28:50.289,0:28:55.600 what Maine and Connecticut have done. And I can talk about that in questions, but the 0:28:55.600,0:29:00.169 point I want you to recognize, the critical point about this way of funding elections, 0:29:00.169,0:29:05.700 is if we had an election where the majority of Congress--the vast majority of Congress--took 0:29:05.700,0:29:14.110 small dollar contributions only, then we all could believe, as we all want to believe, 0:29:14.110,0:29:18.070 [laughter] that when Congress did something stupid it was either because there were too 0:29:18.070,0:29:22.160 many Democrats or because there were too many Republicans, or because they just didn't understand 0:29:22.160,0:29:23.549 what they were doing. 0:29:23.549,0:29:30.669 But not because of the money. The essential element of mistrust and cynicism in the system 0:29:30.669,0:29:35.929 would've been removed by an alternative funding system that gave us no reason to doubt the 0:29:35.929,0:29:39.539 integrity or credibility of what that system was doing. 0:29:39.539,0:29:47.179 Now, this is a way, I believe, to create a reassertion of the dominance of the people 0:29:47.179,0:29:51.570 and the dependence the framers intended and to restore the institution of Congress to 0:29:51.570,0:29:55.890 at least be a little bit more popular than King George at the founding. 0:29:55.890,0:29:56.090 [laughter] 0:29:56.090,0:30:00.419 OK. Now that's the argument. Here's the hard question. How do you get there? I don't think 0:30:00.419,0:30:05.549 it's hard to describe the problem. We all believe we believed in the problem before 0:30:05.549,0:30:06.850 I even said anything about it. 0:30:06.850,0:30:10.150 And it's not even hard, I think, to describe a solution. I'm happy to tell you more about 0:30:10.150,0:30:16.650 mine, but I think the solution is pretty clear. What is hard--maybe what's impossibly hard--is 0:30:16.650,0:30:23.160 to imagine the political movement that brings about the solution. And the reason for that 0:30:23.160,0:30:28.330 is an insight given to me by Congressman Jim Cooper, Democrat from Tennessee, who has been 0:30:28.330,0:30:30.980 in Congress for as long all but about 20 other members of Congress. 0:30:30.980,0:30:35.360 And Cooper said this. He told me "the problem with Capitol Hill is it has become a quote 0:30:35.360,0:30:43.289 'Farm league for K Street.'" K Street, the home of lobbyists. A farm league for K Street, 0:30:43.289,0:30:47.289 meaning members and staffers and bureaucrats have this increasingly common business model 0:30:47.289,0:30:48.400 in the back of their head. 0:30:48.400,0:30:55.570 The business model is focused on their life after government, their life as lobbyists. 0:30:55.570,0:31:00.710 Public Citizen calculated between 1998 and 2004, 50 percent of Senators left to become 0:31:00.710,0:31:04.830 lobbyists. Forty-two percent of the members of the House. Those numbers have only gone 0:31:04.830,0:31:06.250 up. 0:31:06.250,0:31:11.980 And so, in a world where everyone depends upon the existing system surviving, because 0:31:11.980,0:31:18.850 that's the only way they have a lucrative after-government future, how to we begin to 0:31:18.850,0:31:25.049 imagine that institution and those people--the lobbyists, the members of Congress, the staffers, 0:31:25.049,0:31:30.299 the bureaucrats--ever organizing to change that deeply corrupt system? 0:31:30.299,0:31:35.730 Well, in my book, I consider four ideas. One of them is the ordinary idea--the idea of 0:31:35.730,0:31:40.299 passing a statute. That idea is impossible. I looked it up on Google. It is impossible. 0:31:40.299,0:31:40.890 [laughter] 0:31:40.890,0:31:46.610 It's technically impossible. It's impossible because there is no way they will ever radically 0:31:46.610,0:31:52.679 change the system that both got them there and will carry them out in very well-paid 0:31:52.679,0:31:58.990 lobbyist’s jobs. So that leads me to three insane solutions that are only improbable, 0:31:58.990,0:32:00.500 not quite impossible. 0:32:00.500,0:32:03.909 And the third of these, the one that I ultimately think will be the most important, is this 0:32:03.909,0:32:10.720 suggestion of a convention. So, the framers of our Constitution in Article Five created 0:32:10.720,0:32:15.909 the standard way by which the Constitution gets amended. That is, Congress proposes an 0:32:15.909,0:32:19.580 amendment and three-fourths of the states ratify it. 0:32:19.580,0:32:23.280 But then at the convention, somebody said, "Well, what if Congress is the problem? What 0:32:23.280,0:32:29.730 do we do then?" And so, they set up an alternative path. The alternative path is that states 0:32:29.730,0:32:34.830 can call on Congress to call a convention. The convention then proposes the amendments 0:32:34.830,0:32:37.730 and those amendments have to pass by three-fourths of the states. 0:32:37.730,0:32:42.530 So either way, 38 states have to ratify an amendment, but the sources of those amendments 0:32:42.530,0:32:49.070 are different. One is inside. One is outside. Now, all three of these insane ideas are really 0:32:49.070,0:32:55.470 just ways around what is, I think, the cancer that is DC right now. And it's recognition 0:32:55.470,0:33:03.059 that the ordinary means of politics are just not feasible for this kind of problem. 0:33:03.059,0:33:07.659 In this--you can think of--extraordinary times, what's gonna be required here is that we do 0:33:07.659,0:33:15.059 something that we have not done in a very long time--to build a politics that looks 0:33:15.059,0:33:23.030 different from this. A politics that is not--to borrow from my older work-- a 'read-only' 0:33:23.030,0:33:30.590 politics--where people sit there and passively consume what's fed to them in broadcast form. 0:33:30.590,0:33:34.900 But instead, read/write politics where people become more active and engaged and reclaim 0:33:34.900,0:33:41.549 this from the politicians. Now, here's the hard part. I don't actually know whether it's 0:33:41.549,0:33:47.000 possible for us to do it. We don't have any good evidence that we, as a people, have the 0:33:47.000,0:33:53.960 capacity to actually take back power from the professional politicians and reorder it. 0:33:53.960,0:33:59.860 No good example in our recent past. Lots of good reason to believe people are too disengaged 0:33:59.860,0:34:08.149 to be able to do it. I do think we know, however, how that process gets started. And it begins 0:34:08.149,0:34:17.200 with, first, clarity. The clarity of Thoreau. The clarity of a root striker. 0:34:17.200,0:34:20.729 So it might not be surprising that the coolest website of the Occupy movement is the Occupy 0:34:20.729,0:34:27.079 Seattle movement. But if you go to their demands page, you're met with this list of literally 0:34:27.079,0:34:31.659 hundreds of demands, which they are now trying to decide which are the most important of 0:34:31.659,0:34:33.739 their demands. 0:34:33.739,0:34:39.749 Everything from protect the environment to--my favorite--end the industrial prison complex. 0:34:39.749,0:34:45.819 OK. Which is significant there and also here, but that's the scope. All right. Now, I think 0:34:45.819,0:34:49.929 all of these demands are important. It would be great to get Congress or the states to 0:34:49.929,0:34:52.169 address any of these demands. 0:34:52.169,0:34:56.899 But the point is if you come forward with a list of a hundred demands, you come forward 0:34:56.899,0:35:03.700 with noise. And nobody hears anything because they can't hear everything you're trying to 0:35:03.700,0:35:10.759 say. Instead, this movement needs to find a way to clarify and focus. It needs to celebrate 0:35:10.759,0:35:14.029 its diversity, recognize there are leftists in that movement. 0:35:14.029,0:35:18.210 They shouldn't deny the fact they're leftists. There are people on the right in the Tea Party 0:35:18.210,0:35:21.359 movement. They shouldn't deny they're from the right. They should all stick to their 0:35:21.359,0:35:25.729 principle, but they've got to seek a common ground. 0:35:25.729,0:35:32.249 Not compromise, but a common ground so that they actually do speak for the 99 percent, 0:35:32.249,0:35:36.930 not just the 21 percent of people who identify as liberals or the 30 percent of people that 0:35:36.930,0:35:42.099 identify as supporters of the Tea Party. I think there's an exercise we all should go 0:35:42.099,0:35:42.269 through. 0:35:42.269,0:35:47.969 We should be forced to come into a room and say, "We on the left, believe this. We on 0:35:47.969,0:35:54.069 the right, believe this." But then ask the critical question, whether there's a set of 0:35:54.069,0:36:00.789 beliefs that we all share, that could be the foundation for some important reform. And 0:36:00.789,0:36:07.940 my view is that if we could focus people's attention on the wide range of issues that 0:36:07.940,0:36:13.920 they're frustrated about and get them to connect the dots--so whether it's on the left, health 0:36:13.920,0:36:16.589 care reform, or on the right, government bailouts. 0:36:16.589,0:36:21.430 On the left, global warming or on the right, complex taxes. On the left, financial reform 0:36:21.430,0:36:25.769 and on the right, financial reform. Whatever the issue is, if we could focus them, they 0:36:25.769,0:36:34.039 would see this root cause. And the root cause is this picture. A democracy that is distracted 0:36:34.039,0:36:36.319 by a dependence that was never intended. 0:36:36.319,0:36:43.440 And the practice of the root striker has got to be to find a way to get, we the people, 0:36:43.440,0:36:52.509 to see this root. So, that's number one--clarity. Number two is a kind of boldness. Now, in 0:36:52.509,0:36:58.259 the book, I make a little bit of fun of a guy you're familiar with. 0:36:58.259,0:36:59.069 [laughter] 0:36:59.069,0:37:05.660 So, Eric Schmidt came to a talk at the American Academy in Berlin. And it was the first time 0:37:05.660,0:37:09.279 I'd ever met him, first time I'd ever heard him talk. And I was amazed. It was the first 0:37:09.279,0:37:14.400 time I'd ever heard anybody lay out the Google vision. 0:37:14.400,0:37:18.930 And I was astonished. I mean, I was astonished by him. He was extraordinary, but I was astonished 0:37:18.930,0:37:25.150 by the Google vision. This is a place. You saw these really big ideas about how they 0:37:25.150,0:37:30.059 were gonna, you guys, were gonna remake the whole world. The whole world. 0:37:30.059,0:37:34.369 And I was more excited about the work going on here than I had even been in my whole life. 0:37:34.369,0:37:40.009 I felt like this was amazing. So then I thought, "OK. Wow. This is a company of big ideas." 0:37:40.009,0:37:46.420 And I said, "Eric, so there's a whole bunch of public policy issues where the world is 0:37:46.420,0:37:47.799 against you guys. 0:37:47.799,0:37:55.539 And I think you guys are right." So, immigration, anti-trust, copyrights, network neutrality. 0:37:55.539,0:37:59.180 You guys are on the right side of all of those issues and the rest of the world is on the 0:37:59.180,0:38:03.369 wrong side." And the reason the rest of the world is on the wrong side is exactly the 0:38:03.369,0:38:05.119 corruption that I've been talking about today. 0:38:05.119,0:38:10.299 So, what are you gonna do about it? Are you gonna sit around and swipe away these bad 0:38:10.299,0:38:15.180 policies like flies at a picnic? Or are you gonna solve it in the way Google addresses 0:38:15.180,0:38:20.400 a problem and radically remakes the world to solve it? And for the first time in that 0:38:20.400,0:38:24.549 evening, a tiny idea was expressed. 0:38:24.549,0:38:28.039 And it was expressed by Eric Schmidt. Because he didn't have any big idea to think about 0:38:28.039,0:38:33.150 solving this, the most fundamental problem. I agree with Matt that we, as a Republic face--any 0:38:33.150,0:38:37.609 idea like, "Oh, we're gonna get the Google PAC to be more aggressive in teaching people 0:38:37.609,0:38:39.559 what our views about policies were. 0:38:39.559,0:38:45.430 Nothing to change the core root of the problem. Just playing the system with all sorts of 0:38:45.430,0:38:53.809 resources allied against you. What we need here is a Google-level idea. What we need 0:38:53.809,0:38:59.339 is the kind of big idea that you deploy in every other sphere of social life that might 0:38:59.339,0:39:05.019 get this democracy to the place that could address this problem that I guarantee you 0:39:05.019,0:39:12.039 95 percent of experts say is impossible for the world to solve, for us to solve. 0:39:12.039,0:39:17.170 Impossible. But that's the sort of problem you guys take all the time. That's what you 0:39:17.170,0:39:22.900 do. That's your job--the impossible problem. And we need that. And we need that from people 0:39:22.900,0:39:26.299 like you. Now, number three, we need courage. And this is also related to the company, but 0:39:26.299,0:39:28.109 I won't pick on the company anymore. 0:39:28.109,0:39:33.849 Instead, I'll talk about my friend, Arnold Hiatt. So, he's a humble guy. This is the 0:39:33.849,0:39:36.299 biggest I could find of him on the net. 0:39:36.299,0:39:37.029 [laughter] 0:39:37.029,0:39:39.219 [Lawrence Lessig coughs] 0:39:39.219,0:39:44.319 Arnie was the president of Stride Rite. They make great shoes, like Keds. He's also a loyal 0:39:44.319,0:39:50.880 Democrat. In 1996, he was the second largest contributor to the Democratic Party. So, in 0:39:50.880,0:39:55.910 1997, Bill Clinton invited him and 30 other large contributors to a dinner at the Mayflower 0:39:55.910,0:39:59.729 Hotel to tell him, the President, what he should do for the remaining part of his term. 0:39:59.729,0:40:06.589 So, it's this dinner of these fat cats at the Mayflower Hotel to help guide policy in 0:40:06.589,0:40:09.890 America. And each of them got to stand up and address the President. We didn't have 0:40:09.890,0:40:13.920 any pictures. Arnie was the last one to speak. I kind of envision it like this. 0:40:13.920,0:40:18.670 He stood up and he looked the President straight in the eye and he said, "Mr. President, I 0:40:18.670,0:40:25.890 know you're an admirer of Franklin Delano Roosevelt. So I want you to put yourself in 0:40:25.890,0:40:33.440 Roosevelt's shoes in 1940, when he reluctantly came to recognize that he needed to convince 0:40:33.440,0:40:38.239 a reluctant nation to wage a war to save democracy." 0:40:38.239,0:40:44.319 'Cause he said, "You, too, Mr. President. You, too, need to convince a reluctant nation 0:40:44.319,0:40:53.779 to wage a war to save democracy. Not a war against fascists, but in a certain sense, 0:40:53.779,0:40:59.839 a war against us fat cats." A war against people who believe, merely because they are 0:40:59.839,0:41:03.930 rich, they are entitled to guide government policy. 0:41:03.930,0:41:06.709 People who believe merely because they've been successful in the marketplace, they're 0:41:06.709,0:41:12.670 entitled to have dinner with the President. People who have convinced the American public 0:41:12.670,0:41:19.969 that this republic does not work. Now, put yourself in Hiatt's shoes. Imagine yourself 0:41:19.969,0:41:24.999 in that room with 30 other fat cats and the President, basically saying to each of those 0:41:24.999,0:41:29.799 fat cats and the President, "This is illegitimate what's happening here." 0:41:29.799,0:41:32.529 There was silence after he said what he said. 0:41:32.529,0:41:33.430 [laughter] 0:41:33.430,0:41:37.569 The only published account of the evening says that Clinton's response effectively slashed 0:41:37.569,0:41:45.239 Hiatt to pieces, humiliating him in front of the group. I think 14 years later, we need 0:41:45.239,0:41:49.459 to recognize that it was Arnold Hiatt who was right. 0:41:49.459,0:41:55.839 We do need to convince a reluctant nation to wage a war to save democracy. But where 0:41:55.839,0:42:02.599 Arnold Hiatt was wrong was in his belief that politicians would wage that war. It's not 0:42:02.599,0:42:08.660 gonna be politicians. It's gonna be citizens. It's going to be us. It's going to be root 0:42:08.660,0:42:09.989 strikers. 0:42:09.989,0:42:17.130 And I pray it's going to be you. It is our job that requires our courage. It is our republic. 0:42:17.130,0:42:25.219 It is ours, not theirs. They took it away, but we let them. Here's one more story before 0:42:25.219,0:42:31.479 I stop. So, many of you might remember--actually, many of you weren't born, but OK. 0:42:31.479,0:42:40.630 Many of you might remember this event, 1989. The Exxon Valdez crashed into Prince William 0:42:40.630,0:42:47.019 Sound, ran aground, eleven million gallons of oil was spilled into the Sound. This is 0:42:47.019,0:42:51.499 the recording of Captain Joseph Hazelwood when he called in the accident. 0:42:51.499,0:42:53.619 [plays sound clip] 0:42:53.619,0:42:54.329 [static] 0:42:54.329,0:43:03.509 >>Captain Joseph Hazelwood: Yeah. Ah, it’s VALDEZ back. Ah, we’ve— ah, should be 0:43:03.509,0:43:14.109 on your radar there— we’ve fetched up, ah, hard aground north of, ah, Goose Island 0:43:14.109,0:43:26.119 off Bligh Reef. And, ah, evidently, ah, leaking some oil, and, ah, we’re gonna be here for 0:43:26.119,0:43:30.469 a while. And, ah, if you want, ah, so you’re notified. Over. 0:43:30.469,0:43:30.469 [end sound clip] 0:43:30.469,0:43:34.930 >>Lawrence Lessig: And ah, if you want, as, so you're notified. Over. Now, as many of 0:43:34.930,0:43:39.009 you are thinking, there might be a little bit of a question about whether Captain Joseph 0:43:39.009,0:43:44.950 Hazelwood was intoxicated at the time this accident occurred. He denied it. He said he 0:43:44.950,0:43:47.809 only had four vodkas before he got on the ship. 0:43:47.809,0:43:51.579 But his blood level alcohol indicated he must have been at least six times over the legal 0:43:51.579,0:43:58.140 limit when he climbed on board that ship. But he fought it. His lawyers fought it hard. 0:43:58.140,0:44:02.670 There was some ambiguity in the evidence and he was not convicted. So, let's say there 0:44:02.670,0:44:09.339 was doubt about whether Hazelwood was drunk when he was captaining a supertanker. 0:44:09.339,0:44:15.130 What there was no doubt about was that he had a problem with alcohol. His mother testified. 0:44:15.130,0:44:20.269 She had known he had a problem with alcohol. In 1985, four years before the accident, Exxon 0:44:20.269,0:44:24.400 had treated him for his problem with alcohol. After the accident, Exxon's President said 0:44:24.400,0:44:26.380 he "thought he had mastered the problem." 0:44:26.380,0:44:33.180 But in 1986, he had his driver's license revoked for a DUI. In 1988, he had his driver's license 0:44:33.180,0:44:38.269 revoked for a DUI. At the time he was captaining a supertanker, he was not allowed to drive 0:44:38.269,0:44:39.559 a VW Beetle. 0:44:39.559,0:44:40.519 [laughter] 0:44:40.519,0:44:50.249 OK. But forget Hazelwood. Instead, I want you to think about those around Captain Hazelwood, 0:44:50.249,0:44:56.700 these other officers. People who could have picked up a phone while a drunk was driving 0:44:56.700,0:45:01.130 a supertanker. I want you to think about the people who did nothing because all but one 0:45:01.130,0:45:04.859 of those officers did nothing. 0:45:04.859,0:45:10.880 What do we think about them? Now, I ask this question because as I think about the problem 0:45:10.880,0:45:18.819 this nation faces increasingly, I believe we are they. This nation faces critical problems 0:45:18.819,0:45:22.700 requiring serious attention, but we don't have institutions capable of giving them this 0:45:22.700,0:45:22.999 attention. 0:45:22.999,0:45:34.529 They are distracted, unable to focus. And who is to blame for that? Who is responsible? 0:45:34.529,0:45:40.200 I think it's too easy to point to the Blagojeviches and hold them responsible, to point to the 0:45:40.200,0:45:45.999 evil people and hold them responsible. It's not the evil people. It’s the good people. 0:45:45.999,0:45:47.739 It's the decent people. 0:45:47.739,0:45:55.140 It's the people who could've picked up a phone. It's us. It's we, the most privileged. Because 0:45:55.140,0:45:59.709 the most outrageous part here is that these corruptions, of course, were primed by the 0:45:59.709,0:46:07.700 most privileged, but they were permitted by the passivity of the most privileged as well--permitted 0:46:07.700,0:46:09.420 by us. 0:46:09.420,0:46:15.569 When Ben Franklin was carried from the Constitutional Convention in the summer of 1787, a woman 0:46:15.569,0:46:20.009 stopped him on the street and said, "Mr. Franklin, what have you wrought?" Franklin replied, 0:46:20.009,0:46:30.410 "A republic, ma'am, if you can keep it." A republic. A representative democracy. 0:46:30.410,0:46:41.769 A democracy dependent upon the people alone. We have lost that republic and all of us have 0:46:41.769,0:46:53.259 to work to get it back. Thank you very much. 0:46:53.259,0:46:54.989 [applause] 0:46:54.989,0:47:08.489 I'm happy to take questions. I'm a law professor, so I could call on people if you don't ask 0:47:08.489,0:47:09.170 questions. 0:47:09.170,0:47:09.859 [laughter] 0:47:09.859,0:47:11.239 Yes, sir. 0:47:11.239,0:47:18.440 >>MALE #1: Do you have any opinions on electoral reform? I can't vote for the party I want 0:47:18.440,0:47:22.999 'cause if I vote for anybody other than Republicans or Democrats, my vote is wasted. 0:47:22.999,0:47:26.779 >>Lawrence Lessig: Yeah. I think that there's a whole list of other reforms that we also 0:47:26.779,0:47:33.269 need to think about with democracy. The way we gerrymander districts, the way we have 0:47:33.269,0:47:38.099 winner-take-all seats. All of these things I think are critically important, too. I'm 0:47:38.099,0:47:41.699 trying to think about the sequence of problems. 0:47:41.699,0:47:45.380 And I think the sequence of problems is, this is the problem we need to solve first to create 0:47:45.380,0:47:49.039 an atmosphere, an opportunity, to begin to address the other problems. So, I'm happy 0:47:49.039,0:47:54.459 to sign up with you on that once we fix the problem I'm talking about here first. Yeah. 0:47:54.459,0:47:58.299 >>MALE #2: Hi. Two quick questions. The first is, what's the name of the Senator that came 0:47:58.299,0:48:01.549 up with the little bastards that are greedy in the greedy bastards quote? 0:48:01.549,0:48:05.469 >>Lawrence Lessig: He would not go on the record with him name, [audience chuckles] 0:48:05.469,0:48:09.229 so the Huffington Post piece says it's an anonymous Senator who said this. 0:48:09.229,0:48:14.959 >>MALE #2: OK. Secondly, about the Constitution Convention, using say, legislatures. How are 0:48:14.959,0:48:17.999 the state representatives gonna be different from the national representatives? 'Cause 0:48:17.999,0:48:22.119 aren't they just as greedy and looking to climb the ladder of political opportunity? 0:48:22.119,0:48:27.160 >>Lawrence Lessig: Yeah, so state legislatures just passed resolutions calling on the Convention. 0:48:27.160,0:48:30.660 And the question is, how do you populate the Convention? And here's the really insane, 0:48:30.660,0:48:34.140 totally completely insane idea, that I have for the Convention. 0:48:34.140,0:48:38.660 I think the Convention should be populated by a random selection, random proportional 0:48:38.660,0:48:45.789 selection, of citizens. Now, people think that's crazy. And I agree. You're not gonna 0:48:45.789,0:48:47.589 argue anybody into insanity. 0:48:47.589,0:48:54.249 I think what you've gotta do is to show them, like let's run 30 or 40 or 50 of these mock 0:48:54.249,0:48:58.819 Constitutional Conventions where we have deliberative polls where we randomly select a representative 0:48:58.819,0:49:03.440 mix of people from a jurisdiction and we give them the information they need. 0:49:03.440,0:49:07.279 And we have them work through the issue and see what they come up with. California has 0:49:07.279,0:49:11.249 a good example of this. The California Forward Project ran a deliberative project, deliberative 0:49:11.249,0:49:15.859 poll, around the question of what California should do. And the product of that is extraordinarily 0:49:15.859,0:49:20.479 impressive--much better than anything the professionals did. 0:49:20.479,0:49:25.449 And I think that signals the core insight, which is politics is one of these rare sports 0:49:25.449,0:49:29.180 where the amateurs are actually better than the professional. Because the professional 0:49:29.180,0:49:35.380 is good at figuring out how to benefit the special interests that the professional depends 0:49:35.380,0:49:35.880 upon. 0:49:35.880,0:49:41.380 And the amateur, like a jury, can be summoned into a state where they're not thinking so 0:49:41.380,0:49:45.619 much about the special interest. So, I think the only way a Convention makes sense is if 0:49:45.619,0:49:49.569 we can avoid it being captured in exactly the same way government has been captured. 0:49:49.569,0:49:54.999 And I think the only way to that is to have this randomly selected body be the Convention. 0:49:54.999,0:50:00.759 >>MALE #3: First of all, thank you so much for being here and for devoting so much time 0:50:00.759,0:50:01.859 to this very important issue. 0:50:01.859,0:50:02.859 >>Lawrence Lessig: Thank you. 0:50:02.859,0:50:11.039 >>MALE #3: My question is, given the election of Obama in 2008, and then the following three 0:50:11.039,0:50:17.989 years, how much of the overwhelming Democratic majorities and the election Obama have helped 0:50:17.989,0:50:21.489 the momentum of this campaign finance reform campaign? 0:50:21.489,0:50:25.900 In that, I think there's a lot of people who sort of generally understand the Republicans 0:50:25.900,0:50:32.920 were bought, but I think when the nation was rallied around this feeling in 2008, and then 0:50:32.920,0:50:36.109 the disappointment that's come out of it, I just--. 0:50:36.109,0:50:44.529 >>Lawrence Lessig: Yeah. You and I share that view precisely. The book is--. Obama was a 0:50:44.529,0:50:48.920 friend. He was a colleague of mine in Chicago. I campaigned for him. I worked hard for him. 0:50:48.920,0:50:54.420 I talked to a lot of people in here when he first was on the trail about how he'd be so 0:50:54.420,0:50:56.969 great for what we cared about. 0:50:56.969,0:51:02.039 But the only reason I think he was credible as a candidate over Hilary Clinton, was that 0:51:02.039,0:51:06.440 he, unlike Hilary Clinton, said, "This system is the problem. We have to take up the fight 0:51:06.440,0:51:10.269 to change the way Washington works. And if we don't, our children are gonna be facing 0:51:10.269,0:51:11.680 the same problems we faced. 0:51:11.680,0:51:15.170 And our children's children will be facing the same problems they face." So, he made 0:51:15.170,0:51:20.549 it--. He said twice at least, I have recorded in the campaign, "This is the reason I am 0:51:20.549,0:51:26.809 running. To change the system." And then he got elected and he opened up the Clinton playbook. 0:51:26.809,0:51:30.549 And he ran his Administration according to the way Hilary Clinton would've run her Administration. 0:51:30.549,0:51:33.640 And I think maybe Clinton would have done a better job. I don't know. But if Clinton 0:51:33.640,0:51:38.890 had done exactly what Barack Obama did, I think we should say, "Great. You did what 0:51:38.890,0:51:43.009 would come from that kind of Administration. But you promised, Barack Obama, a different 0:51:43.009,0:51:44.940 Administration." 0:51:44.940,0:51:50.469 I feel it's a betrayal from what we thought we were getting. It makes it really hard for 0:51:50.469,0:51:57.559 any of us to believe that reform is gonna come from the top or from any insider. So, 0:51:57.559,0:52:03.369 I think that this is why it becomes critical to think about these outside traditional politics 0:52:03.369,0:52:08.539 solutions, which is unfortunately, I think, the only path we've got right now. 0:52:08.539,0:52:13.229 He doesn't stand credible on this issue. The one person who is credible on this issue is--. 0:52:13.229,0:52:19.699 I will vote for Obama over any Republican except one. The Republican you've not heard 0:52:19.699,0:52:25.069 of. His name is Buddy Roemer. Now, it's funny you haven't heard of him. I mean, he was a 0:52:25.069,0:52:25.069 governor. 0:52:25.069,0:52:29.140 He was a four-term Congressman. He ran a bank for 20 years without taking government bailouts 0:52:29.140,0:52:35.069 and successfully created this community bank. But he has made a pledge in his campaign for 0:52:35.069,0:52:38.069 the Republican nomination for President where he will take no more than a hundred dollars 0:52:38.069,0:52:39.539 from anybody. 0:52:39.539,0:52:44.400 He will commit to no PAC money, full disclosure, because he wants to as his slogan, "It's free 0:52:44.400,0:52:47.420 to lead." But because he takes no more than a hundred dollars, everybody says, "Well, 0:52:47.420,0:52:50.900 you can't possibly win so, we're not even gonna pay attention to you." So, he hasn't 0:52:50.900,0:52:55.140 even had a chance to make this case in the debate. 0:52:55.140,0:52:59.690 But if Buddy Roemer were the candidate in the Republican side, that would be a game-changer. 0:52:59.690,0:53:03.910 If it were a Republican making this argument, then it would be much easier to imagine this 0:53:03.910,0:53:05.529 argument actually having play. 0:53:05.529,0:53:08.099 >>MALE #3: Thank you. 0:53:08.099,0:53:14.979 >>MALE #4: Thank you for coming to talk to us today. I have a question about--. I think 0:53:14.979,0:53:18.779 we all can understand that there's obviously a role that Congress has in perpetuating this 0:53:18.779,0:53:22.670 system. And there's a role that we all have in our lack of action in perpetuating this 0:53:22.670,0:53:23.180 system. 0:53:23.180,0:53:25.509 But I think one thing, you didn't get a chance to talk about and I don't know if you talk 0:53:25.509,0:53:30.799 about it in your book--I look forward to reading it--is the role of the Supreme Court and notably 0:53:30.799,0:53:33.839 one of your own bosses. 0:53:33.839,0:53:38.999 And how you talk about the people want to be more involved, but at this point, the Supreme 0:53:38.999,0:53:46.559 Court has defined "person" to be an incredibly broad system and how we can move away from 0:53:46.559,0:53:51.039 treating corporations as people without their movement and how we can actually affect meaningful 0:53:51.039,0:53:53.440 change without movement on the Supreme Court. 0:53:53.440,0:53:57.380 And a Supreme Court that seems very unlikely to move on that particular issue. 0:53:57.380,0:54:01.569 >>Lawrence Lessig: Yeah. So, the particular version of public funding that I advance is 0:54:01.569,0:54:10.069 completely immune from Supreme Court invalidation. Nothing in the Supreme Court, even this Supreme 0:54:10.069,0:54:13.140 Court's doctrine, would draw this type of public funding into the out. 0:54:13.140,0:54:20.150 But it leaves the problem of independent expenditures, both of individuals, George Soros or the Koch 0:54:20.150,0:54:25.069 Brothers, as well as corporations, which now have unlimited amounts to spend. And it took 0:54:25.069,0:54:29.880 a comedian to teach the Supreme Court that, in fact, they didn't have to be disclosed 0:54:29.880,0:54:33.400 if they all could be secret because you could channel them through a C4 that would itself 0:54:33.400,0:54:37.239 be identified, but the contributors to the C4 not. OK. 0:54:37.239,0:54:41.729 So, we have to address the problem of independent expenditures. Now, my view is the law should 0:54:41.729,0:54:46.779 not ban anybody from saying anything. I think corporations should have a right to participate. 0:54:46.779,0:54:52.650 But they shouldn't be able to dominate the political process so that we have not just 0:54:52.650,0:54:58.150 shape-shifting to appeal to the funders, but we have shape-shifting to appeal to the independent 0:54:58.150,0:55:03.420 expenditure guys and therefore, the same kind of dependency that corrupts the system. 0:55:03.420,0:55:09.589 So, the only way to get there without imagining a Supreme Court reversing itself is to give 0:55:09.589,0:55:14.390 Congress the power to limit, but not to ban, independent expenditures. And if you're gonna 0:55:14.390,0:55:18.589 change the Constitution from that standpoint, I say let's have an amendment that has three 0:55:18.589,0:55:19.309 components. 0:55:19.309,0:55:25.609 Number one, public elections must be publicly funded. Number two, contributions to candidates 0:55:25.609,0:55:31.729 should be capped. I'd say at a hundred dollars--equivalent of a hundred dollars. Number three, Congress 0:55:31.729,0:55:36.489 has to have the power to limit, but not to ban, independent expenditures of both corporations 0:55:36.489,0:55:37.279 and people. 0:55:37.279,0:55:41.269 It just has to have the capacity to create a time for election that's not just about 0:55:41.269,0:55:46.549 the money. But getting to the place that we can have the chance to have that amendment 0:55:46.549,0:55:51.900 passed, is the hard thing because again, I looked it up, there's zero chance Congress 0:55:51.900,0:55:53.099 is gonna propose such an amendment. 0:55:53.099,0:55:57.150 And so, if Congress is not gonna propose the amendment, what's the path to get it at least 0:55:57.150,0:55:58.660 on the table for states to adopt? 0:55:58.660,0:56:00.420 >>MALE #4: Thank you very much. 0:56:00.420,0:56:01.299 >>Lawrence Lessig: Yup. 0:56:01.299,0:56:07.009 >>FEMALE #1: Hi. I'm wondering about your perspective on venture philanthropy and the 0:56:07.009,0:56:12.509 role of money outside the congressional system. Is it a pure good? I'm thinking, for example, 0:56:12.509,0:56:16.259 of education reform, the Charter School movement, that sort of thing. 0:56:16.259,0:56:20.699 Or, is there some danger there that money is talking more than it ought to, even in 0:56:20.699,0:56:21.150 those worlds? 0:56:21.150,0:56:26.390 >>Lawrence Lessig: Yeah. It's a great question. I don't think you can say without reservations 0:56:26.390,0:56:32.390 that it's good. Although, you can say it's really great that it's out there, right? There 0:56:32.390,0:56:41.019 are foundations that are not disciplined enough to insulate and protect the recipients from 0:56:41.019,0:56:43.699 developing the wrong kind of dependency on the foundation. 0:56:43.699,0:56:48.749 So, it distorts them in a way that I think is not productive. And so, harmful. But I 0:56:48.749,0:56:55.900 think there are others that adopt a very appropriate relationship to the targets of their giving 0:56:55.900,0:56:59.829 that allows them to maintain their independence, but does support their work. So, I think in 0:56:59.829,0:57:04.459 a case-by-case way, we gotta make a decision about what's the appropriate kind of relationship 0:57:04.459,0:57:05.739 to be drawing in that case. 0:57:05.739,0:57:07.369 >>FEMALE #1: Thank you. 0:57:07.369,0:57:12.189 >>MALE #5: So, we're out of time to take more questions, but thanks again for coming. 0:57:12.189,0:57:13.380 >>Lawrence Lessig: Thank you. Thanks a lot. 0:57:13.380,9:59:59.000 [applause]