your side ♪ >> and by contributions to your pbs station from viewers like thank you. at pbs.org tavis: tarek masoud is an assistant professor at harvard university who has many friends and family-egypt. good to have you on this program. >> thanks for having me. tavis: let me start about asking about your family-egypt. >> there were some pretty rough days early on when the internet was shut off during those nights of chaos, but they are pretty

happy right now. tavis: happy about what specifically. >> happy that mubarak is gone. happy that egypt seems to have taken a really important first step on the road to what everyone hopes will be a lasting democracy. tavis: is it a first death in the right direction? >> it was a necessary step. there were ways that you could have gotten to democracy if mubarak had early on made some reforms when the protesters were asking for them, but it became clear he did not to want to let go of power. he had to go in order for this process to be initiated. the hope is that it will continue. the hope is that the military will follow through on its promise to midwife a real

democratic reform. tavis: i want to ask you whether or not the military can be trusted and a quick question about mubarak. i am always fascinated by this love of power. i am not naive about this but was it just about the power? i am trying to figure out how a guy who is 82 has been the leader for 30 years and years these footsteps and refuses to get out of town. is it just being drunk with power? after 82, what are you holding on for. >> that is a great question. we are hearing he was not getting good information. he was relying too much on one of his sons who was being

groomed for power. that kept him from understanding the gravity of the situation, but when he finally did step down i had this feeling of elation that finally this part of the nightmare would over and egypt could move through democracy. i also had this sense of depression because i thought this is a guy who 18 days ago could have made this move have y intact. this is a man who really brought egypt to economic ruin. he did all these terrible things. there is this concept about this man whose -- who owns a garden and is so happy about it. if this man entered his garden and was being unjust to himself

by bragging because he is arrogant. i think mubarak committed all kinds of injustices to the american people but also committed a grave injustice to himself. people would have said he was a flawed leader but at least he let go at the right time. tavis: beyond letting go at the right time, how will this not just color but staying his legacy? i ask that because the thing that is fascinating is there was some good that he accomplished in his 30 year rule. i don't think any of that will be remembered given how it came crashing down. >> if you have asked us 18 years ago about his legacy we would have said what he just said.

what he did during those 18 days really exposed the nature of his regime. this is a guy who was reliant on force. he concluded it was kill or be killed. almost 400 people have died in these protests. i think that's any incidental good that may have been done during his regime -- anything that was remotely good during his 30 years of power he completely obliterated. tavis: back to your point about the military midwifeing, can the military be trusted to play that role? >> i tend to be a skeptical guy. the military controls 40% of the economy.

the military is concerned about stability and about the democratically elected leaders might make statements that caused israel to feel nervous. there is reasons why i think the military is not going to follow through, but when i talk to people in egypt, they all really believe firmly the military will follow through on its promise to initiate democratic reforms and have reforms-six months. they believe it wholeheartedly. tavis: you have to juxtapose that hopefulness with the reality which is that egypt -- every leader they have ever had has come out of the military.

>> the mubarak regime was a military regime. we have examples of the military's handing over power you have it in portugal in 1974 and sudan. the general state one year and left. a few years later the military conducted a coup that still rules, but there are issues of militaries handing over power. the egyptian military does not want to rule, it wants to rain. it does not want to govern on a day-to-day basis. they hope the military gets out of the web. tavis: we know from the coverage of this explosion in egypt that there is not a leader and i am not sure that is

a bad thing. the question is who is the leader? how do you assess that? is that a good thing? >> the opposition will need to coordinate in such a way they can have somebody who can negotiate on their behalf with this military. it is not clear whether they have that. i worry that those who don't want to see the opposition's goals achieved might try to manipulate and split them by creating disagreement because this is a broad movement. but i think they are going to need to figure out who represents them and pushed the military to follow through on them. >> i have 30 seconds. what are we to make of these new protesters who are emerging? there is a new batch of

protesters. >> because a lot of people's grievances are not simply political. they are not about democracy and an end to police oppression. they are also about serious economic grievances. the real challenge is by getting rid of mubarak you can respond to some of the political grievances. he will also need to respond to these economic grievances. the military has called for these protests to stomp is not hopeful. what we need is for these economic grievances to be addressed. tavis: tarek masoud, good to have you on the program tonight up next, financial crisis in jury -- in green chair, -- inquiry chair, phil angelides.

tavis: the recently released its report on what caused the economic crisis and ways to avoid a future crisis. the book will make its debut this weekend on the "new york times" seller list. good to have you back on the program. let me start with the point about the times and what you make about the fact that there is enough interest for it to be one of the 10 best-selling books in the country? >> there is a lot ofa nger and confusion. a lot of americans want to know how 26 million americans are out of work. they want to know why 4 billion families lost their homes to foreclosure. in this book which has been out for two weeks no one has challenged any of these issues. there is a real appetite to

know and understand so we can avoid this calamity again. tavis: is the text relevant these days? >> it sure is. there are a lot of people on wall street who want to paper over what happened two years ago. it was an of people and financial earthquake. for a decade we had built a paper economy built on financial engineering. we created trillions of dollars of securities that were packaged and then there was this collapse. it is important we understand why this happened. what we found is this was unavoidable. there were a lot of people who said this was the perfect storm. lloyd blankfein said it was like a hurricane.

regulators who were asleep at the switch. >> what role did greek play in this process? >> -- greed play in this process. >> there was a deregulatory philosophy that assumed corporations would always act in everyone's best interests. we failed to account for the excesses'. the fed knew in mid-1990's there was predatory lending going on. lenders were offering people loans they could not afford to repay what they did not act. we saw companies were taking enormous risk packaging mortgage securities and knowing they were defective.

many did not meet the minimal standards but they were sold across the world. greed played a factor but it was the failure to have these in place to contain the excess. tavis: president obama wants to find a way to wind it down freddie mac and fannie mae. what do you make of that? >> i have not had a chance to look at his recommendations yet? we found freddie mac and fannie mae --these were publicly traded corporations. they followed wall street into investing in risky subprime mortgages but that was to regain market share and get compensation. i don't think you can go back to a model of having privatized gains and socialized losses.

the american taxpayers bashed up the losses. i hope we move to a model where we don't have the up side going into the private sector and downside with the tax payers. tavis: you mentioned the report finds the crisis was avoidable. this report also finds government was ill equipped to deal with them period where this mess unfolded. talk about the fact it was unavoidable. talk about the fact that government was ill-equipped to deal with it. >> there are two phases here. we made a set of decisions to allow a shadow banking system to

become even bigger than our regular banking system. the fed sat on its hands while predatory lending practices went on. the government tried to stop states from enforcing fair lending laws. when the crisis head, what was most striking was those who should have known the most, treasure and federal reserve -- they did not question the financial system that evolves underneath. they did not realize how far the infection had spread. they did not realize the risk. it was one month before lehman brothers goes down that the federal reserve says we better look at the 900,000 derivatives contracts that lehman brothers

has with other parties to see what will happen if they collapsed. we were flying blind in sliding this crisis because the policy makers had lost control of the financial system. tavis: i don't want to depress you given the great work you have put into this but if i said to you there are two reasons why i think it is not going to be taken seriously. there were a couple of folks on your committee so the entire commission could not agree on the report. a divided congress should not be expected to take this if the committee cannot be on the same page. why should they divided congress take this seriously congressman

issa said he wants to investigate the work of your committee. what does it mean? >> yes there were dissenting opinions but there was a lot of common ground. nine out of 10 believe the investment act was not a factor. nine out of 10 commissioners agreed the credit regencies -- credit rating agencies fell down. most of this book is pure fact. the official chronicle of what happened over the last 30 years to bring us to the point where we have this choice, let the financial system collapse or put in trillions of dollars while millions of americans still lost their homes and life savings.

one of the most important things we have done is laid out the truth of this crisis so it cannot be rewritten. mr. issa now wants to investigate us. we had a lot of researchers and investigators who gave their lives to it. it is a very chilling affect for members of congress to investigate this commission for this work. it is very chilling and reflective of what happens in washington. paul krugman said it is intimidation and not investigation. we want to make sure critical

issues can be investigated. this is a full and fair investigation. not anyone from the powerful financial industry has laid one piece of doubt on the fax you laid out. tavis: and not one person from the financial industry is going to pay anything. the american people will continue to pay a huge price for this collapse. anybody on wall street is going to pay the price? >> here who has paid the price, working americans. not wall street or people in political circles. this is very disturbing to most americans. we were not set up as prosecutors. we were told if we found violations of law we were to turn those over to the attorney- general. where we found information, we

referred it to the proper authorities but it is time people step up. prosecutors take a look at the evidence gathered. we need justice but the right kind of justice is that people understand who is responsible and we are very specific. people like alan greenspan who did not believe in regulation. there was lack of accountability that that's at the community level people, took loans they should not have taken, but at the end of the day it is the people on top who sought positions. i think the american people are entitled to know the facts and the real lesson is we have built -- in nomy where1980 in

1980 -- over one-third of the corporate profits were in the financial sector. one point i want to raise, this was supposed to be about putting people in homes, but in 2004 is when home ownership peaked. after that, it was all about packaging and selling securities and not creating more home ownership. tavis: here is what i find absolutely asinine and beyond troubling about this. whatever one thinks of freddie mac and fannie mae, the white house now lays out a plan to pressure them out of business but the folks on wall street are not just in business, are making more money than ever before.

the same president who wants to push them out of business is begging these titans the industry to loosen up the trillions of dollars they are sitting on to put that back in the economy. i have no reason to believe what ever you told eric holder that given the cozing up the administration is doing to business and trying to move to the middle -- this attorney general is not going after anybody or anything they did. the american people ought to be concerned. >> on freddie mac and fannie mae, they made big mistakes but we have evidence their loans were better than the worst stuff on wall street. when you take the same kind of borrower -- fannie mae and need to be freddie mac. let me say barney frank and

chris dodd past financial reform legislation, but now there will be efforts to stop the full implementation. we need that law implemented. in terms of justice, there needs to be justice here. i think prosecutors need to look at what happened between 2003 and 2008. they owe it to the american people to make sure if laws were broken that people are brought to account. tavis: the book is called "the financial crisis inquiry report." went back 30 years to figure out how what happened in 2008 did happen. they concluded it was avoidable. a lot of recommendations for how to avoid this ever happening again. the chairman of the committee, former gubernatorial candidate, phil angelides. thanks for your work and thanks

for coming on tonight. >> great to be with you. >> that is our show for tonight. good night. thanks for watching. as always, keep the faith. >> for more information on today's show, visit tavis smiley at pbs.org. tavis: join me next time for a conversation with jazz great, wynton marsalis and his work on music education at lincoln center. >> all i know is his name is james, and he needs extra help with his reading. >> i am james. >> yes. >> to everyone making a difference, you help us all live better. >> nationwide insurance supports tavis smiley. nationwide insurance is proud to join tavis in working to improve financial literacy.

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