>> cohan: welcome to the program. i'm william cohan, special correspondent at "vanity fair" filling in for charlie rose. we begin this evening with charles blow of the "new york times." >> part of the writing for me is just an exhaling of what i believe, and i'm trying to be as true in that as humanly possible and not have that -- you know, not steer towards trying to get people to click on something, not steer towards trying to win an audience, but simply to express the truth of what i believe. >> cohan: we conclude with author jesse eisinger, his new book is called "the chicken (no audio) club," why is executive department re-- why the justice department fails to pros prosecute executives. >> we have two justice system,

mass incarceration in one we disproportionately punish the poor and those of color, and i'm concentrating on the other side where we give impunity to wealthy, powerful people who sit as c.e.o.s and chairman of the powerful corporations. >> cohan: charles blow, jesse eisinger, when we continue. >> rose: funding for "charlie rose" has been provided by the following: bank of america. life better connected. >> and by bloomberg, a provider of multimedia news and information services worldwide. captioning sponsored by rose communications from our studios in new york city, this is charlie rose.

>> cohan: good evening, charlie is away. i'm william cohan, special correspondent at vanity faimplet we begin tonight with charles blow, he is a best-selling author, commentator and visual op-ed columnist for the "new york times." his recent columns have grown increasingly critical of the trump administration. many see him as one of the leaders of what can loosely be called "the resistance." i am pleased to have charles back at the table. welcome charles. >> thank you. >> cohan: great to have you here. my temptation would be to immediately start with current events which is tempting, but i'm going to resist that because i really enjoyed your july 3 column which is called, of course, the hijacked american presidency. i'm going to read a little from it because it was so powerful, i thought. you start by saying, every now and then, we're going to have to do this, step back from the daily onslaughts of insanity emanating from donald trump's parasitic presidency and remind

ourselves of the obscenity of it all, registering its magnitude in its full devastating truth. we must remind ourselves trump's very presence in the white house defiles it and the institution of the presidency. rather than rising to the honor of the office, trump has lowered the office with his whiney, fragile, vindictive pettiness. the presidency has been hijacked, and there are no words to express it. there's no new and novel way to catalog it. it is what it is and has been from day one, the most extraordinary and profound electoral mistake america has made in our lifetimes and possibly ever." powerful stuff. why? >> why senat -- why not? there are a lot of different people who play different roles in society. as a writer, journalist, even opinion journalist, part of the job is to bear witness, and to that extent, what else should i

be writing? you know, how else should i be considering what is happening? there are reporters who their job is to follow the day-to-day in every incremental change. my job i considered in a different way, it is to kind of step back a little bit and offer some perspective. when i do that, it is shocking what we are witnessing. >> cohan: was there a catalyst for you with the trump presidency or the very act he was even elected or nominated. >> rose: how far back did it go? is it you being a new yorker, recognizing what donald trump is all about, being a new yorker? >> i think all of that is true. i mean, you cannot have lived in this city and not register that he was a part of the city, a social presence in the city, an economic presence in the city, and that there was a kind of

vialnesvial -- vileness to it. there was a declasse part of him that people registered. that it wasn't an aspirational thick if you lived in new york city to be like trump or like him, it was a joke, and he treated his own presence in the city very much, a lot of it was appearing, you know, on comedy shows. >> cohan: howard stern, the tabloids. >> absolutely. even when he appeared on kind of more mainstream shows, it was kind of a comedy act, and, you know, he shows up in, you know, world wrestling federation and all sorts of things, and he kind of played with it, and we looked at it in a certain light, but we never took it seriously. you know, but you catapult from that position to him as a politician, a serious contender for the nomination of the republican party, and then to

actually become president, and then all of the comments and all the things he said have a different weight, and they were incredibly distasteful. and it's not just, you know, the flirtation with women. you know, he pushes past that to bragging about assaulting women. it's a very different thing. this is the same person who took out -- you know, people don't remember this. he took out full-page ads in new york city newspapers, including the "new york times," after the center park jogger episodes calling for these kids to be, you know, executed, and there was a lot of mee of -- a f heat around it at the time. even after they were cleared, he still wouldn't take it back. there is something problematic about the character of this person, and to take that character and to see ut play

out -- it play out real time, not just historical fact, but in realtime he is committing even more offenses, more sins against society. somebody has to keep pulling the lens back and saying this is not normal and this is not right, and whatever your reasons, you know, you can make an argument you didn't like hillary clinton -- >> cohan: and people have. -- yes, and you can make an ideological argument you were opposed to obama's policies because he was liberal, maybe you are conservative, but you had other choices and you chose him, so i can't separate you from him. >> cohan: was there some point you decided you had to sort of take up the pen or the computer keyboard is this. >> part of the writing for me is just the exhaling of what i believe, and i'm trying to be as

true in that as humanly possible and not have that -- you know, not steer towards trying to get people to click on something, not steer towards trying to win an audience but simply to express the truth of what i believe, and if that finds an audience, great. if people can use that to help fuel their fire, great. if it changes someone's mind, great. but that is not the objective for me. the objective for me is this is the truth of what i feel about this situation in the moment. you know, sometimes people are shocked when i say i'm not trying to change anybody's mind. i'm not. if it does, great, but i am trying to document what is happening and how i feel about what is happening, and i hope that that is helpful, but that cannot be the motivating factor for writing, i don't believe. >> cohan: would you ever see yourself actually marching on

washington or being more of an activist than just in your column? it has happened columnists have become activists and involved politically. >> no, i can't see it and, also, i do believe that different people in society play different roles. i think the artists, whether or not you consider columnists sort of a high level of writing or not -- >> cohan: it's hard work. exactly. but writers in general have a role, and it's not necessarily what people consider, you know, front line, but i believe that it is front line, i believe that history has shown us that the kind of capturing and distillation of thought is an incredible motivator in terms -- and also kind of framing mechanism for activism and that that is a special role unto itself, that it is not passive, that writing is an action, and that action is sufficient.

it does not require an additive thing to make it active, and that, you know, what history shows is that, when people attack societies, very often they attack the arts first because they understand the power, but they attack the poets. you know, that -- so you do have skin in the game, it's just in a different way. >> cohan: have you been attacked, accused, have you felt any of the barbs? do you feel somehow threatened now that the pen is mightier than the sword? >> well, you get some people who, you know, cross lines and occasionally you have to alert -- there is a whole mechanism where you have to alert the security and they talk to police. so that happens. but it is really important, i

believe, that you never be afraid. i believe that art is, in fact, the absence of fear. you know hammer, the infamous civil rights icon said what's the point of being scared, right? in her quote, she went on the say, all they can do is kill me and it feels like they have been trying to do that a little bit at a time ever since i was born. i'm a product of that southern environment, and i do have that posture of what is the point of the fear? what does -- what do i achieve by being afraid? >> cohan: you have been a fighter your whole life since you grew up in gibbsland, louisiana, less than a thousand people population. >> yes. >> cohan: you've come a long way from there. how do you do it?

>> there's a very rich history in the south, and there was a very rich history in my particular neighborhood, and i never ever felt compromised or limited. i never heard anybody when i was a kid tell me no you can't do something. if you could dream it, they would say, that sounds like a great idea, now how do you get it done. they would help me figure out how to get it done and i would get it done. >> cohan: beyond your parents or -- >> i went to a school that was started as the first college in northwest louisiana to educate the sons and daughters of former slaves. that school is my high school. it's still in the same spot. they combined it with another school. it used to be coleman, now it's gibson-coleman. i look at people, a lot of people in the north, in movies, where black people are struggling to get reputation and

people want to see the spike lee movie and complain in the theater there were no black people on the walls. and i think all i ever saw were black people. they were the originators of the college. they were erar erudite and taugt latin, and in growing up with that, you emerge without the social racial scars. i just never had that baggage. i never had the sense i couldn't be the smartest person in that room because every room i went into, a black person was the smartest person in the room, so the idea it couldn't be me never occurred to me. toni morrison said i always thought i believed i had the moral high ground, that anybody who would even dane to assume they could be racist to me and i was somehow lesser than them was

so outrageous to me and i was such -- and in the moment it happens, i immediately assume you are morally compromised. >> cohan: but you recognize this is an unusual experience. >> it's the only experience i have. but i do kind of -- >> cohan: you're an educated man -- >> i temper myself when i talk about it because there was a segregation involved in it, not because black people wanted to be sprarkts but white people didn't want their kids to go to school with us, and we had the educational experience all to ourselves and it wasn't a negative. it was the oldest school in that whole area, and when we would -- we came into spaces carrying that and understanding that this is -- that whatever kind of history you have or your school or whatever, what you think it is, i have 100 years of amazing black people doing amazing

things against all the odds, and they're on my back, and i'm on their shoulders, and that idea i carry with me all the time, that if they could do that in the middle of nowhere, then what is impossible? i couldn't get over the idea that something could be impossible to me. it just didn't make sense to me. >> cohan: that was reinforced by going to grambling, which i gather you didn't want to go to, but you went and you said that sort of reinforced this idea because everyone around you was -- >> i didn't go because it was too close. it was 20 minutes from my house. i wanted to run away. >> cohan: where did you want to go? i wanted to go to william and mary. >> cohan: huh. i got a brochure. i never applied. >> cohan: the polar opposite of grambling, i would think.

>> i was kind of trying to run away. even though it was in the south, it felt north to us because we were in louisiana. i read the description back then. we didn't have google, so you get this big book, had all the colleges and they have descriptions. they had a great description and i thought, that sounds good because it sounds like me. the recruiter gave an important sneecht had an impression on me. i decided to go to l.s.u., i got a full scholarship. he said l.s.u. doesn't need you, grambling needs you. it really made an impression on me because what he was saying to me is you're not just coming here to get something from us, i want you to come here to give something to your fellow students, and that is the way that i kind of navigated college was that it was that i was

giving as much as i was getting. >> cohan: and, i mean, you were a standout in high school intellectually. you were editor of your high school newspaper. you were a standout at grambling, magna cum laude graduate. did you always know you wanted to be in journalism? you did that in high school and college. did you want to change the world? >> i had no desire to be a journalist. i majored in english and pre-law because i thought i would become a lawyer. i liked writing. when people asked me the question you asked before which is how someone goes from being on the visual side to writing, i tell people -- >> cohan: especially at the "new york times." >> i tell people the fluke is how i went from being someone majoring in english to being on the visual side. that was the fluky part. the writing is like coming home. that's like something i've

always done. but journalism just wasn't a profession in my world. i'm from a tiny town, the closest newspaper was eight miles away anit was a couple of volunteers, they did it on the side and had another job. so the idea as a journalist as a way to make a living didn't exist, so i didn't have a role model that would say this is something i wanted to do, but the idea of expressing was something that was important to come a politician, and part of that -- >> cohan: you wanted to be governor of louisiana. >> i wanted to be governor of louisiana. that was the thing. no more. ( laughter ) >> cohan: you were inspired by edward edwards, of all people? >> inspired, in the worst possible way, not that i don't like him, but in the worst possible way in the sense that i tell kids, this is not aspirational, do not do what i did, because i went on a tour, it was a bunch of kids from north louisiana and some program, and we went to the

governor's mansion. first, we took a tour of the capitol building, and they were pointing out all the craziness that happened in louisiana politics, it is truly a crazy history. this one got shot here, and his wife locked him up in an insane asylum. it was just craziness. >> cohan: famously so. yes, famously. so we go to the governor's mansion, and governor edwards, at the time, strolls in, and, you know, he's just like the most magnetic, interesting, flamboyant character, you know, and he was a folk hero in a way. one of his elections, the most popular bumper sticker in the state was vote for the crook, it's important. because he was running as david duke who had been the grand wizard of the ku klux klan. everyone knew edwards was a crook, but they kind of liked

it. it was fascinating. >> cohan: the same state hughie long was a politician of some renown. >> yes. i looked at it and said these guys are having a ball down here, i want to be the governor. so it wasn't an honorable decision to make, but there was a part of me also that really did believe in public service, and all of my heros as a kid were people who had kind of changed the world and, you know, i had posters of martin luther king and a t-shirt with martin luther king. i liked him in the way that other people like rock stars and athletes because, to me, he epitomized something that i aspire to. he was incredibly educated which is something that gets glossed over a lot. i mean, how incredibly educated and how eloquent he was and not just, you know, in the kind of inflection of the voice, but if you pick through the speeches,

the incredible breath of the references he's making -- you know, greek references. and i'm thinking to myself, half of the people in these audiences don't understand what they're hearing, but he's making them and grounding them in kind of southern gospel, and this idea that you could bridge those two worlds of the highly intellectual and the common southern language. >> cohan: they certainly felt his passion. >> absolutely, you could feel the passion, but i think, intellectually, academically, those speeches are -- stand apart from just the passion. they are incredibly well-crafted. he was writing them. there are no speech writers. this is him. the idea that he could span all of literary history and real kind of on the ground history and weave that into a narrative that made sense for people, many of whom had not -- maybe they

finished high school, not gone to college, and still make all that makes sense and to speak to all those different audiences was an incredibly powerful thing for me. i still think, in a way when i'm writing now, that i think of them as sermons. >> cohan: what i read at the beginning to have the show sounded like a sermon, had that kind of power. >> cohan: also there is the kind of -- >> also there is the kind of practical nature of preaching, which is you're really talking about the same subject every week, you just have to find a different way into it. >> cohan: you can probably relate to that as a columnist. >> right, a columnist is very much like that. >> cohan: so do you have a journalistic hero, or do you just sort of -- >> i did not -- i mean, i've never thought i was going to be a professional writer, so -- and i never desired to be a

professional writer. so when i starred this column, it was very visual and data-intensive and it just kind of morphed into more of a writing job, but, for years, after i started this problem, when people asked what i did, i wouldn't have a long explanation. i couldn't make myself say writers because i thought of writers as other people, not me. >> cohan: you left the "times" and went to "national geographic," i guess, to continue to work on your visual side. >> yes, i was the art director of "national geographic" magazine. >> cohan: which is a beautiful opportunity. but you came back, which is rare, and now you're writing this column which is, you know, obviously an incredible accomplishment. are you as data driven now in the writing of the column as you sort of were when you were doing the visual column? because with your trump columns,

we'll call it "the resistance" columns, these feel very passionate as opposed to data driven but maybe they are data driven. >> they're not as data driven, obviously. >> cohan: explain what that means. what were you doing with data that you were -- >> well, i mean, when i started, i just wanted to use data to make a point. the pages were about perspective. but i wanted to make a point using data. >> cohan: you wouldn't write something until the data -- >> i would follow the data. if i found a good data set that i thought was interesting, then i would write about the data that i found. >> cohan: like that dating column, where people weren't dating as much. >> exactly. but that meant that you weren't necessarily following your passion and your, you know, what appealed to you intellectually that week, you were really following data. so it kind of makes you -- you're being led by the nose by that.

now i write what i believe is important to write, and then i support that with whatever data exists. it's just a different way of just kind of turning it around. >> is one easier than the other? clearly. >> cohan: writing from your gut. >> yes. you have no control over data. you have no control over who's collecting it or when they publish it. so you're likely scratching for things very often and, so, this way, it makes it much, much easier. >> cohan: one thing i've never understood really about the 2016 election, and you have sort of alluded to it at the front when we were talking about donald trump the new yorker, is sheer we are the media capital of the country, we knew donald trump, new yorkers have known donald trump, seems like, forever, right? we knew without trying to editorialize too much here, sometimes i write columns, too,

that he was not the greatest developer and sort of was a bit of a showman, shall we say. we knew better, i think, in new york, and you could see that by the way people voted in this city and state that he was not, perhaps, the best choice. why wasn't the media capital of the country able to convey that to everybody in the land? or was it that we were just not trusted? >> no, i think, you know, there is a bit of media malpractice involved in this. i mean, there were people who did not take him very seriously in the beginning. i think it's fair to say that -- you can understand that to some degree. >> cohan: never had an elected office in his life. >> but by not taking him seriously, he was not held to the same standards. so he could say things, lie

about things, his checkered passed could be made public and people weren't applying the same standards as to a traditional politician. but in addition to that's correct people saw an opportunity to make money. >> cohan: off of donald trump? off of donald trump. >> cohan: people in the media? yes. he was flagrant entertainment. >> cohan: couldn't take your eyes off him. >> and in those days, he would always grab the interview. now he won't grab any interviews. but in the beginning of the campaign, he would grant the interviews, call in to shows, and traditional politicians would be scared they would make a mistake, they wouldn't do this. he was a walking mistake, it didn't matter, and he would say anything, and people -- it was like, you know, rubbernecking a car wreck, people found it

distasteful but also were paying attention and tuning in, and people registered -- i mean, media executives registered that meant money, and that is how the media was complicit in helping to shore up his candidacy in the beginning. now, there is a very different media environment now but he's already the president. you can't unwind that. we can break all sorts of amazing stories, and people are doing amazing journalism and some won a pulitzer out of it, some won an emmy out of it, but he's the president now, and we have never in this country successfully impeached a president. the fathers did not want it to happen, they made it very difficult, and it is very difficult. we've had two presidents who have been impeached by the house, and the senate refused to follow through, and then nixon

resigns before they even voted on the articles of impeachment. we've just never done it. to here's the caution -- no matter what journalism does now, i'm not sure that it pays for the sin that it committed in the beginning. >> cohan: so turning to sort of more current events like the stories that your newspaper has broken in the last three or four days about the infamous now donald trump, jr. email, has this brought us closer to potential impeachment that may never happen, which seems to be what a lot of people are rooting for? is this just a very interesting story that's going to be like another one of those things where donald trump said he could shoot people going down fifth avenue and people would still vote for him? what's your perspective of recent events. >> the magnitude of

appropriateness is off the chartsz. >> cohan: with this email? this email is just one of a multitude of sins. sins. completely inappropriate. not fitting the office of the president, not fitting -- i mean, it's just you could not design a worst set of characters than trump and his cronies. but that is a separate point of discussion from whether or not it is criminal and whether or not it rises to the point where the judiciary -- well, someone in the house -- >> cohan: some special prosecutor, for instance. >> well, the house would have to draw up articles of impeachment. >> cohan: of course. you could have a prosecution, but people -- we've never been in this spot so the legal community seems to be divided and kind of leaning towards the

idea that you could not prosecute a sitting president. so impeachment is all you have left. >> cohan: he cannot be indicted, probably isn't going to be indicted. >> yes. so all you have left is the house and the senate, and right now they're in republican control, and whether or not they'd want to -- you know, they would be moved to do that, we have seen no signs of it. so it's hard to know where this all ends up. i mean, you could have a situation where democrats take the house, and then you would get articles of impeachment. whether they were passed in the house -- >> cohan: that's 2018. that's '18, at least. then you have the underlings, the jared kushners of the world, the juniors of the world. >> cohan: who's not even in the administration. >> manafort, carter page, there are active investigations, and

those people could be indicted, charged, convicted. but as long as you have trump as president, he has the power to pardon. so it's very tricky. >> cohan: sounds like there will be a lot of people who will not be satisfied that all the recent events and all this bad behavior will lead to his being removed from office or resigning from office. >> i mean, right. that is the hard truth, and what i try to tell people is that you have to -- your resistance must be rooted in principle and not in expedient removal because you have no control over whether or not he is removed, and that process, if it ever gets underway, could take a very long time, and there are a lot of twists and turns in that, a lot of -- at least there is some unsettled, legal conundrums

involved, whether or not you could indict him and charge him and try him. even if it ever comes to that, we're not there yet. but what you can control -- but what you can't control is the principles on which you stand. -- but what you can control is the principles on which you stand, and if you root your resistance in that, it has a longer life, and the goal can be a political and societal transformation that is bigger, because something happened in society that allowed this to happen. there's a russian interference, the voter suppression, there is also, you know, kind of dampened enthusiasm on one side, maybe a little bit more enthusiasm on the other, but people change behaviors also in that last election. >> cohan: there's a lot of frustration and anger. >> it was very complicated.

the frustration, anger, but also, you know, when people have looked at this, they realize that their kind of racial anxiety played a much larger role than the economic anxiety. >> cohan: charles blow, thank you for being here. >> thank you. >> cohan: we'll be right back. >> cohan: we continue with jesse eisinger. he is a senior reporter at the non-profit news organization propublica. in 2011, he was awarded the pulitzer prize for a series of stories he co-authored on the financial crisis. he has just written a new book, his first book. it's called "the chicken (no audio) club: why the justice department fails to prosecute executives". i am pleased to welcome jesse eisinger to this table for the first time. jesse, welcome, and i do just have to say, i've read this book because i blurbed this book, so i just want to make sure people

know that. >> thank you for having me and thank you for having read it. >> cohan: we're going to talk about this title, but we're not going to say -- i'm not going to repeat the title again. it's an interesting title. why do you choose this title? please explain this title. i know you do in the book, but -- >> well, it comes from a speech that james comey gave, and now you may remember -- >> cohan: the now famous james comey. >> yes, the now famous james comey from such roles as being fired as f.b.i. by donald trump. but 15 years ago he was in different role, he had just become the u.s. attorney for the southern district of new york, and that is the premier job for the law enforcement officer of corporations on wall street. the southern district is the prestigious office of the department of justice. now main justice competes but back then that was true. he came in and he was replacing a legend in the office, mary jo

white. >> cohan: who became the securities and exchange chairwoman. >> exactly, under obama. so a lot of my characters in my book have sort of cameos and reemerged in the obama and trump years. so comey gathers all the criminal prosecutors together in this st&y and says i'm going to give you a speech but, before i do, i want to ask you, how many of you guys have never lost a case? and a bunch of hands shoot up. you have to understand who these people are. these are the best of the best of the best. gone to the best law schools, best clerkships, hottest shots, think of themselves as the best trial lawyers in the country, so they're very proud of their records. a bunch of hands shoot up. he says me and my buddies have a name for you guys. you are the chicken (bleep) club, hands go down, and, you know, they're a little sheepish. what did he mean by that?

he means you can't be just about winning an undefeated record, you're not a sports team. your job is to be ambitious and do justice and that means if you have to take on difficult cases, you have to take on the most powerful people you can, and that's how you do justice in america. >> cohan: and, so, did these people take this message to heart? did they change their behavior as a result? >> well -- >> cohan: because, of course, this is a book about, i think, failure to prosecute. >> exactly. >> cohan: so, at some point, i'm not sure they did take his -- >> they don't and, unfortunately, the department of justice at large becomes the chicken s. club, i think, overall, and now i argue that the department of justice lost the will and ability to prosecute top corporate executives in america. this is the flip side of inequality. we have two justice systems, a mass incarceration where we

disproportionately punish the poor and people of color, and then we've got the other side, and i'm concentrating on that, which is that we give impunity to wealthy, powerful people who sit as c.e.o.s and chairman of the major corporations, and i'm not just talking about the banks and the financial crisis. this affects retail and tech and pharmaceuticals and industrial companies across the spectrum of large companies. >> cohan: how did that happen because both of us cover the financial industry, finance in general. we've had many other financial crises in our history as a country and, generally speaking, after all the other ones, the people who did wrong, the wrong-doers got prosecuted and paraded out many front of the cameras to show others that, you know, you can't get away with this in america. >> exactly. >> cohan: that did not happen this time. could you trace for us how this

evolved, how this happened? >> sure. after the s.n.l. crisis, thization and loan crisis in the bush years, lots of top executives go to written. after the mike miklin era, almost all the powerful people, they go after goldman sachs, and millican himself who is arguably the most powerful person on wall street at the time, they go after lawyers. after the enron era scandal also and accounting scandals, philadelphia, tyco, they prosecuted roomi've which single one to have the companies, and prosecuted the top people at the companies. what happens? what happens is they lose this ability. what i argue in the book is it begins in a backlash against the progressive prosecutions of enron many america where the corporations and the white collar bar starts to lobby and

push prosecutors back on their heels and lobbying the congress and white house to rein back prosecutorial power. then the department of justice loses some cases, have some very unfriendly rulings in the courts, suffer internal fiascoes and through that process they lose this ability to prosecute individuals and, instead, they start to focus on set leng with corporation force money, writing checks. >> cohan: okay, but why, why, why? was it the arthur anderson which obviously ended up in the liquidation of the firm but then the reversal at the supreme court? was it the famous holder memo that you write about, that i've written about that became sort of the holder doctrine and next thin you know eric holder is the attorney general and he is the one not prosecuting these cases? how did it happen? i mean, how did we go from people being paraded out?

mike millican, you know, his toupee being taken off, paraded in front of the cameras, made an example of. how did we go from that to nothing, to zero. >> is this well, why? it's a very good question. i mean, the thing that i did not find, i don't think exists, maybe it's in a secret vault somewhere, is the memo or call from timothy geithner, treasury secretary, to eric holder saying don't prosecute bankers, i don't believe that happened. i think it's a much more systemic problem, institutional problem at the department of justice, and there is a lot of unexamined assumptions and everybody understands what they should and shouldn't do without having to have a policy or edict. there are two reasons. one is they think they want to reform corporate culture, and they think they can reform

corporate culture by settling with companies, and they enter into deferred prosecution agreements, these things where they write checks but make a bunch of promises to reform and at's one.tter. the other thing is they internalized corporate executives is essentially in the government because there is kind of a class affinity. they see expensive by and large as well educated, articulate, contributing members of society who, if they have run afoul of some rule, it must be that they're good people who have made one bad mistake and they just don't see it in their bones to prosecute them like they'd prosecute a drug dealer or mobster or corrupt politician. >> do you buy that argument? no, i think that corporate executives deserve punishment, especially -- and i think we need to put a lot more corporate executives in prison, a lot more

c.e.o.s in prison. i don't think they made just one my take because they settle all the time, pfizer, jp morgan, goldman sachs, settle over and over and over. they're residivists. the settlements don't work to reform corporate behavior. the thing that would work is prosecuting individuals and depriving them of their liberty. i, of course, see the vast majority of corporate executives and c.e.o.s as doesn't, law abiding people, but i see corruption that is not punished and people aren't held accountable and those we need to go after and the department of justice doesn't do it anymore. >> cohan: is it because eric holder wrote that memo when he was assistant attorney general saying that if we prosecute corporations or prosecute people in corporations, you know, we're

going to put these people out of jobs and we're going to -- these corporations are going to go out of business is what happened with arthur anderson and, therefore, we'll be sorry so we shouldn't do that? i'm trying to understand where this came from. >> it evolves over time, so holder who doesn't actually write that famous memo, that's -- you know, he attaches his name to it, but that's actually a spit fire prosecutor in the southern district, a woman named shira ninan who contributes but it's a team, she's mary jo white's right-hand come and goes down to washington to make sure they don't screw up, comes up with a bunch of principles, and nobody thinks much about them. they put in this notion essentially changing american law and jurisprudence in this country, they put in this notion, well, we should take into account you can put people out of work when you prosecute a company and you should take into account the collateral consequences, as you said, which

is either putting people out of work or it's disrupting the capital markets. and then nobody thinks about it that much. and then arthur anderson happens. >> right. and that's a product of the enron task force. that's a product of the enron prosecutions. i view the enron prosecutions as incredibly successful, as the right way to go about these cases. they prosecuted individuals and they worked their way up to the top. >> cohan: worldcom, successful, tyco. >> all of those. the way they did those was they focused on those cases, they flipped lower-level individuals, so you get the soldiers to flip on the copo to flip on the others and that's the way you make cases against jeff skilling or ken lay, the heads of enron, who were not putting stupid stuff in email. you don't have direct evidence against him. now they're overdependent on direct evidence and shy away from case where is they can't

make those against the executives. so what happens is anderson goes down and learn this terrible long lesson which is we can never prosecute a company again. >> cohan: because they feel responsible for accountants losing their jobs. >> yes. >> cohan: who got jobs elsewhere. >> it's an extraordinary p.r. victory and i try to detail in the book exactly how it happens. first, i want to convince readers this prosecution was justified, i want to seek to rehabilitate it because arthur anderson was a recidivist company, a corrupt institution that was the handmaid of not just enron's accounting fraud but sun beam, worldcom, as you mentioned, many others. >> cohan: it facilitated a lot of criminal behavior. >> it did indeed. and with enron, breath taking in audacity by destroying tons of documents and obstructing justice. it was legitimate that you prosecuted the firm, that the firm went down and corporate bookkeeping got cleaned up a bit

for a few years after that because there was a deterrent effect. that's not the lesson amazingly enough that mary jo white, lanny brewer and eric holder learns. >> cohan: lanny brewer being eric holder's righthand man. >> yes, the head of the criminal division in the justice department under obama and eric holder under covington and burlington, both leave a big firm to go under obvious and return to covington and burlington. >> cohan: and lanny caught on tape in the documentary where he's espousing the holder doctrine, if you will. >> exactly. so they internalized a different message from anderson. they internalized that this is a terrible thing, that we can't put people out of work, it's too disruptive, and when the financial crisis happens, they're very trepidacious about

prosecuting a bank because the markets are so fragile. my argument, if you are worried about systemic consequences of prosecutor companies, focus on individuals. instead, they don't. i think it is a skill set issue. they don't put the resources or time in. they say they have every incentive to do it but they don't have the incentives to do it and that has to do with the revolving door. >> cohan: right, exactly. do you think that because eric holder and lanny brewer were thinking of going back to covington, who are making a lot of money now. >> yeah. >> cohan: of course, eric holder famously has been hired by uber to examine the culture there and released his whatever it is, 13 pages of findings, and that's to the public. the rest of it has not been made public. i mean, how much do you think this revolving door, which is a big issue, we saw with robert kuzami who was the head of enforcement at the s.e.c. during

all this and he did not prosecutor any individuals, as far as i can tell, and now he's gone back to a high-paying law firm -- wall street law firm. is this the culprit? >> they all do. they all do. >> cohan: exactly. do you think they're thinking if we prosecute we're not going to get those job offers? >> simply put, yes. they're thinking about their future job opportunities. >> what does that say about our justice system? >> it says it's corrupt and unjust and it says it's broken. we have the dirty secret of american corporate law enforcement is that we have outsourced and privatized it to the corporations themselves who hire law firms made up of former prosecutors who then conduct internal investigations and deliver those to the department of justice. the prosecutors who are so overwhelmed and underresourced don't literally page through it and flip through it and take dictation but they effectively do in many cases, those internal

investigations the big law firms conduct are studiously curious and investigative threads that will take them to the board level or take them to the c suite, they ignore those most of the time. some of them are good. so it is a broken system. the young prosecutors who negotiate these settlements, that were told by eric holder and preet ba rare and all, they have incentive to put their name on the front major in the market to go after a c.e.o. that's not what happens in practice. in practice you're running theories isic of investigating for years and maybe not finding something, and if you find something you may go to trial farntiond you go to trial you're going to go up against the best trial lawyers in the country, and you might lose, and if you lose -- >> cohan: they are the best prosecutors in the country. >> they are but they don't have trial experience.

one thing that changed is they don't do trials. the average u.s. attorney does .29 trials a year now, compared with in the early '70s eight trial a years. they do one trial every three years now, they used to do eight trials a year. >> cohan: so james comey was absolutely right? >> james comey was absolutely right and you see it with preet bharara, the great hero of the left because he was also fired by donald trump, and he did, to his great credit, prosecutor some of the most powerful politicians in new york state. what he didn't do was prosecute wall street. he did perform this incredible jed die mind trick on the press because he got labeled the sheriff of wall street, the man busting wall street, when he was actually doing something, a side light, you know exactly what i'm talking about, he was doing insider trading cases and hedge funds. that's not wall street. >> cohan: and low-hanging fruit, especially when you're taping them and catching them.

>> it's much easier and the jurislike it and they ran up an 80-nothing record. think about the chicken s.ness of wanting to guard, protect that undefeated record. so that led them to, i think, cowardly decisions bike not prosecuting stevie cohen himself at s.e.c. they prosecuted the firm, they prosecuted eight individuals successfully at that firm, that hedge fund. that firm was the embodiment of that person. it wasn't like he was jamie dimon the steward of this long-standing institute, public institution, session ri, that existed before jamie and will exist after him. it was stevie sew cohen is sac capital and down to the initials and yet they don't prosecute him because they're afraid of their trial expertise even in these cases that they feel like they know insider trading, so that leads you to these other large

companies which they're just not going to do for individuals. >> cohan: what effect -- i mean, because they did try with the two bear stearns hedge fund managers in the eastern district of new york and there was some jockeying whether the eastern district would take the case, they did and proceeded to lose the case, prosecuted it quite poorly, in my judgment. i'm not an attorney but i wrote a book about the collapse of bear stearns and in that book there was documentary evidence i had dug up of i think intent to deceive hedge fund investors which the hedge fund managers. that was never brought up in trial. do you think losing that case in the eastern district of new york in 2009 further chilled any prosecution? >> absolutely. that was one of the losses that had a cascading effect through the entire department of justice where they saw that and thought, my god, these cases are too

complex and difficult and they're not going to be slam dunks. i agree with you completely. they get their backs up and i understand it because i think they feel personally insulted when i say this, but the skill set, the trial set, the skill set has eroded and they didn't do a good job on that trial. they rushed it. they thought they had a few damning e-mails but they didn't see the whole picture, they didn't argue the case well. it wasn't a complex case. one of the other arguments is these cases are so complex, you have collateralized debt obligations, there's nothing more complex than enron. enron had offbalance sheet vehicles, secret ownerships, nigerian barges, there were loans that looked like anything but. so that was an enormously complex thing that they did manage to prosecute without direct evidence against lay and skilling. lay and skilling hadn't said anything stupid in the e-mails.

what they dud was they -- did was they messed up with bear stearns and got gun shy. >> cohan: on that depressing note, jesse eisinger, that much for being here. od luck with your first book. hope there are many more. >> me, too. >> cohan: thank you. >> rose: for more about this program and earlier episodes, visit us online at pbs.org and charlierose.com. captioning sponsored by rose communications captioned by media access group at wgbh access.wgbh.org

>> rose: funding for "charlie rose" has been provided by: bank of america. life better connected. >> and by bloomberg, a provider of multimedia news and information services worldwide. >> you're watching pbs.

this is "nightly business report" with tyler mathisen and sue herera. >> show me the money. the dow closing at a record and ek peckations are high that earnings season will be strong, but there's a lot of think. >> warning from washington. and social security face financial challenges in a new report has new dates on when the programs will be b depleted. >> cash is king. why americans are filing money into their checking accounts. those stories and more tonight on night "nightly business repor thursday, july 13th. >> good evening and welcome. it is the eve of earnings season. the report card on corp. rapt s health comes at an interesting time. investors are