Robert Scheer and David Dayen Uncover Untold Stories of the Mortgage Crisis

Kevin Dooley / CC-BY-2.0

In this week’s episode of “Scheer Intelligence,” Truthdig Editor in Chief Robert Scheer speaks with David Dayen, author of the book “Chain of Title: How Three Ordinary Americans Uncovered Wall Street’s Great Foreclosure Fraud.”

Dayen and Scheer discuss the federal government’s failure to respond to millions of people who suffered from the mortgage fallout from the 2008 bank crisis. Dayen tells Scheer that anger over foreclosures has fueled this year’s bitter and unusual presidential race. The two also discuss why, despite the best efforts of the book’s subjects, little has been done to mitigate homeowners’ losses.

—Posted by Alexander Reed Kelly

Full transcript:

Robert Scheer: Hi, this is Robert Scheer, with another edition of “Scheer Intelligence,” where the intelligence comes from my guest, in this case, David Dayen, who wrote a book called “Chain of Title,” and its subtitle tells it all: “How Three Ordinary Americans Uncovered Wall Street’s Great Foreclosure Fraud.” True confessions, I just finished a hurried reading of this book, the electronic version, and I thought I would be bored with the details, and I was not at all, because the devil is in the details of the foreclosure story. You’ve got very good asides about how this whole great mess happened, and causing the Great Recession, the detailed description of what happens to ordinary people.

In this case, you singled out three people who chose to fight back—the lousy mortgages they were sold, the fraudulent language in all of the documents, the way the authorities treated them, the way the banks treated them, the lying and tracing your loans. Anybody who’s gone through this, and many Americans have, you don’t even know who owns your loan, and who’s servicing it, and where your checks are going, and who you hold accountable, and these are three people who chose to fight back.

Now you’re a reporter for The Intercept, for the New Republic, you’ve written for Salon, this is your first book, but you’re well-known as a journalist, and you’re certainly … you live here in Los Angeles, and a lot of the action takes place in Florida. Just tell us about the writing of this book, and how it’s been received.

David Dayen: Absolutely, thanks for having me on the show. This does take place in south Florida, three people in the Palm Beach County area. They are a cancer nurse, a used-car salesman and a lawyer who was involved with white-collar fraud, but in the insurance industry, not in mortgages. These are three people that had no real history of this, and by being foreclosure victims, and then reading their own documents, which I call a revolutionary act, because nobody reads their own documents.

Scheer: Just to interrupt here, you do make the point that even if you read the documents, you’re not going to probably get it, and the language is deliberately obfuscated.

Dayen: It’s meant to fool you, absolutely.

Scheer: It’s meant to fool you, and you actually have a poignant scene with the cancer nurse, who’s struggling to keep family—

Dayen: Lisa.

Scheer: —Lisa, to keep family together, and a very sincere person, actually feels, “I’m not going to sign this thing without reading it,” and she actually goes through and she admits she can’t understand it, and she gets swindled.

Dayen: That’s right. What they did on the back end, after they fell into foreclosure, and reading those foreclosure documents, and seeing the discrepancy, and seeing that they’re being sued by people they’ve never heard of before, entities that they’ve never heard of before, and seeing that the alleged transfer to that entity was executed after they were put into foreclosure. In other words, by the evidence they were presented, U.S. Bank, in the case of Lisa Epstein, didn’t own the loan at the time that they foreclosed on her, and that’s just the beginning.

Scheer: You should mention, by the way, these were not fly-by-night banks.

Dayen: No, these were the biggest banks in America.

Scheer: You got Wells Fargo, you got Chase, you got all of these folks in it. I just want to start out by challenging—not the book, which I think is quite terrific, but you raise a question in this book, and a lot of people ask, how did this happen, who’s at fault, and so forth, and when I was reading the book I thought, “This is really a great companion book,” I’m not going to tout my own book, “The Great American Stickup,” and there have been other—

Dayen: Go right ahead.

Scheer: No, there have been other good books, and there was a terrific documentary done, “Inside Job,” which lays out the whole thing, and what you really have is the micro study of this macro problem of political, financial corruption—

Dayen: And that’s what I wanted to do. That road has been traveled very admirably by you, by Charles Ferguson in “Inside Job,” and others. I wanted to look at the people who were most powerfully affected by the financial crisis, and that’s homeowners. Over 9 million people, according to The Wall Street Journal, lost their homes from 2006 to 2014, and yet they were invisible, in terms of public policy, in terms of the culture; foreclosure victims just aren’t talked about. They weren’t even talked about by foreclosure victims; they don’t talk about it to one another. One of the reasons—

Scheer: Well, because they have guilt, and in fact this—

Dayen: There is guilt and shame and humiliation, absolutely.

Scheer: And it’s deliberate. People say, “Well, they took lousy loans, it’s their fault.” You have a wonderful scene where some person on television is saying, “Do you want to pay for the mistakes of your neighbor?”

Dayen: The loser’s mortgages, and that’s Rick Santelli, who is credited with starting the Tea Party with that rant.

Scheer: I want to cut to the chase on one point you make of the people who got hurt, and there’s a devastating study that I bring up all the time, by the Federal Reserve of St. Louis, having access to all the tax data and the financial data and everything else, and they did a study about the impact of the foreclosures, of the great meltdown of the housing market, on college-educated black and brown people. It turned out this was a targeted market, and here you have a crazy election, in which black and brown people are going for the Democratic Party—it was a Democratic president, Bill Clinton, who signed off on a lot of this deregulation, and has celebrated this. “Oh, we’re modernizing the financial sector.” And when you look at that Federal Reserve study, it says that we’re not talking about the general black and brown population, we’re talking about black and brown people who graduated from four-year colleges, and those people lost 70 percent of their wealth—not their income, their wealth.So the question I want to ask you in the context of this election—it seems to me it’s really not being discussed, this whole problem. I happen to be interviewing you here at [the University of Southern California] Annenberg School for Communication and Journalism, the day after the first vice presidential debate, and Tim Kaine, the Democratic candidate, repeated something Hillary Clinton has said, which was the Bush administration did these tax cuts that favored the rich, and then came the Great Recession. Well, the Great Recession had nothing to do with that, and everything to do with a bipartisan, radical deregulation of the financial industry. Yes, it started way back, but it took the signature of Bill Clinton to make it really the law of the land.

Dayen: There’s no question about it. Brad Miller, who was a congressman who actually authored the set of laws that would become the Consumer Financial Protection Bureau, is quoted in my book calling the Great Recession an “extinction event for the Latino and black middle class.” We have the nation’s first African-American president, and he presides over this extinction event of the black and Latino middle class. You’re absolutely right about Tim Kaine—that is an irrelevant non sequitur when you’re talking about the Bush tax cuts having anything to do with the recession. Housing, foreclosures—all of this doesn’t get talked about.

Every time I see one of these long interviews with Obama about his legacy, the first thing I do is I search that document for the word “foreclosure,” and I haven’t found it yet. Nobody challenges him on this, no one talks about it, and yet I don’t think you can talk about the legacy of this president without talking about the fact that he did next to nothing to arrest this wound that was put into the middle class of this country through the foreclosure crisis, and at a moment when he had leverage over the banks, when they were caught faking documents to kick people out of their homes, which is what my book is about, when he had that leverage moment, when he had that moment where the banks were legally exposed, he let them off the hook, and he did not get sustainable solutions for the public that needed them.

Scheer: What’s powerful about your book is you connect the macro and the micro. You have a very good detailed—and I don’t mean detailed in the sense of boring, a very clear—you clearly lay out what other collateralized debt obligations and mortgage back securities and credit default swaps, and you actually trace this whole assault on sensible rules of the road. We had sensible rules of the road put in place at the time of the Great Depression, thanks to Franklin Delano Roosevelt, and the forces that were unleashed, and then we have the dismantling of those rules, and whether it’s Jimmy Carter, whether it’s Ronald Reagan, whether it’s Bill Clinton.

Dayen: You know what the amazing thing about that was? Was that the entire idea behind that, the animating principle behind that, was that we’re going to homeownership up, we’re going to make an ownership society. This was true among Clinton, George W. Bush, all of these presidents. However, the thing that actually created the ownership society to the extent that it did was the post-New Deal era. That’s when homeownership rates went from 40 percent to 60 percent. They didn’t budge after the 1970s, when Wall Street got involved in the mortgage market, when Lew Ranieri, who’s the godfather of this whole thing at Salomon Brothers, set about to turn mortgages into a tradeable asset. It did not improve homeownership, it just transferred this very lucrative market from the public sector to the private sector, and when Wall Street got their hands on it, they made a lot of money, and they broke it.

Scheer: Homeownership expanded because after World War II, it was a feeling we had to pay back something to the veterans, and for $99 down—I worked on the Levittown Project in Pennsylvania, believe it or not, I’m old enough to have actually constructed Levittown—

Dayen: I grew up about 10 minutes from Levittown, Pa.

Scheer: So I remember three boards this way, three boards—two-by-fours, and then three nails, three nails, three nails, and then suddenly you had a house. It was a great idea, but it was also a conservative banking idea. In the old days, you knew you could expand homeownership, but you could do it through a responsible bank, and you went in there to Wells Fargo, for example, and the bank was responsible. Why? Because they would hold this mortgage for 30 years.

Dayen: That’s number one, and number two was savings and loans. They were relying on deposits, so they had a stake in your success as a community, and they could only lend out within a 50-mile radius of their bank headquarters. That made it such that they needed that community to succeed for them to succeed. So when you got in trouble, they wanted to get you worked out so that you wouldn’t default on your loan.

Scheer: Right, and one of the points you make in your book is that part of this rape of the American consumer, which is really what it is, was the federal government, again on the Democrats and Republicans, took away the power of states to regulate banking. One of the ironies in this banking meltdown is that Texas actually fared much better than California. Why? Not because Texas had a Republican governor, and California had more progressive—although they had Republicans also, but because Texas, when it came into the Union, the people in Texas were suspicious of banks that had ripped off stakeholders.

Dayen: Wright Patman, right?

 Scheer: Right. So they had rules on the book that beginning—banks couldn’t even make home mortgage loans, and so I just want—

Dayen: And very tight restrictions on cash-out refinances, which was really the time bomb that led to this thing.

Scheer: Why are we among a handful of people—can actually have an intelligent discussion about this, and everything else is gibberish? No, really, I’m amazed. It’s not discussed in this election, it’s silly talk. And let me just mention one specific thing. During the debate with Bernie Sanders and Hillary Clinton, Hillary Clinton said that Bernie Sanders signed off on the deregulation of the banking, which is the Commodity Futures Modernization Act. Well, that’s garbage. It was an omnibus bill, if you didn’t vote for it—and Ron Paul was one of the few people—Dayen: It was to avert a government shutdown. And in fact the language that was put into that bill originally was much tamer. It was changed radically to go into that omnibus bill by Phil Gramm.

Scheer: Yeah, and that bill, which Bill Clinton signed off on—

Dayen: It was the last thing he signed, almost.

Scheer: Right, as a lame—let’s get this—

Dayen: Lame duck 2000.

Scheer: Lame duck 2000 president, and I think he did it because Hillary Clinton was running for the Senate, and needed Wall Street, and Wall Street was pushing her— “Leave that on the shelf, you can examine that later,” but the fact of the matter is, Title III—we hear a lot about Glass-Steagall, we hear a lot about reversal, but the Commodity Futures Modernization Act—for people listening to this, write down that and look it up—Title III of the Commodity Futures Modernization Act said, “no existing regulation or regulatory agency will be allowed to monitor these collateralized debt obligations.” That was it, and that was to shut up Brooksley Born, who was the head of the Commodity Futures Trading Commission, and to silence her. And it was done by Robert Rubin and Lawrence Summers, who goes on to be head of Harvard—those were two Clinton Treasury Secretaries, and, of course, Greenspan.

So I don’t want to take up too much time discussing the macro, because the great strength of your book is it shows us the devastating effect of taking your savings and getting involved in a house which has a lot to do with your own sense of—to your family, your prestige, your stability, and so forth. And in your book, peoples’ marriages come apart, they suffer terribly, and basically, it’s a portrait of impotence to do anything about it. There’s a sort of theme that goes through your book: “Maybe we’ll get it together.” In the end, they all lose. And they all lose, because whether it’s Obama or Bush or Clinton, they don’t really care about the little people. This is garbage talk at election time.

Dayen: There’s no question that this administration, as in the past, valued bank balance sheets over homeowner balance sheets. And they had this moment where they really could have made it more equitable for people, because these banks were taking false documents, false evidence, and using it in court cases to kick people out of their homes. How many cases would be allowed to go through based on false evidence in the court system in this country? How many kidnapping, murder—any other setting, any other court case, any other criminal trial, civil trial, false evidence is the first thing that would get you kicked right out of that courtroom.

Only [in] foreclosure cases did the judges look at the two sides, and on the one side they see a very nicely dressed bank lawyer, who they might have went to school with, and on the other side they see some “deadbeat,” quote-unquote, who didn’t pay their mortgage, or who is a pro se litigant, who’s acting in their own defense. And they go with the guy in their social class, even though it’s false evidence. They are undermining the very integrity of their own courtroom. And the Obama administration did the same thing. They sided with the banks when they had this opportunity to say, “All right, you guys are caught, now here’s what you’re going to do.”

And Sheila Bair actually wrote it down, Sheila Bair, the former head of the FDIC, she wrote it down, she said, “Here’s what we should do: Every mortgage over 60 days delinquent should be written down to the face value right now, and we should force them to do this as a condition of us not suing and putting in jail every single one of these people for the fraud that they committed. If you do that, and then give shared appreciation, so when the mortgage market bounces back, the mortgage companies can get a little bit of the upside, along with the individual. As long as you give them the break on the way down, you could have had a better economy. The economy would have bounced back more, and you would have shared these losses, these incredible losses that the banking industry did—you would have shared them in an equitable way, rather than putting all the burden on homeowners, the millions of homeowners that got kicked out of their homes.

Scheer: Yeah, and lost their life savings.

Dayen: By the way, she formally proposed that, gave it to Tim Geithner, and I think he threw it out immediately. Nothing was done with that, I think.

Scheer: Tim Geithner was a horror for Wall Street. He ran the Federal Reserve of New York, he presided over the gift. Passing money through AIG to Goldman Sachs—the whole thing is a scam. But the argument that’s used, is when the average person gets screwed with a loan, they didn’t do due diligence. They’re at fault, and we don’t want to bail them out because that will encourage bad habits. So we take the average person and say, “You have to be this adult and responsible citizen, or you’re going to suffer, and suffering will be good for you.” On the other hand, Obama, just like George W. Bush, bails out the banks for their bad behavior.

Dayen: The phrase that you use is “moral hazard.” It’s about moral hazard for the individual, but never for the banks. What the banks started to do during the foreclosure crisis when people said, “Well, you got to show me who owns this loan, I’m not going to give up my home to someone who doesn’t have a legal right to it.” They said, “We’re going to cause strategic defaults.” People are just going to default, just so they can get a modification. And in fact, as I say in the book, the biggest strategic default was the headquarters of the Mortgage Bankers Association in Washington, D.C. They walked away from their headquarters when they couldn’t afford it anymore, all the while spokesmen for the Mortgage Bankers Association were telling homeowners they had to keep paying their mortgage because think of what the impression they would give to their children if they walked out on their obligations, while they were walking out on their own obligations at the same time.

Scheer: As I said before, the devil is in the detail, and the book “Chain of Title” by David Dayen, it goes into these details in ways that—it’s just, frankly, disgusting. I just said to my son, Josh, who is one of the producers of this show, who’s about to get a home loan, I said, “Josh, are you kidding me? Have you really read that? You understand what scoundrels these people are?” And you mention that fraudulent behavior, which, by the way, is made legal when you don’t challenge—but you even had institutions, like you talk about the MIRS System.

Dayen: The MIRS System, yes.

Scheer: Yeah, and the use of computer tech. I mean, Countrywide, for example, they pioneered this whole thing of “We don’t have to have a bank office to talk to a prospective lender. We can do it with computers.” And their model was adopted by Fannie Mae, by the federal housing agencies. They went in there, they wrote the guidelines of—not [to] mention that they wrote the legislation, and when you realize—again I use this word “impotent,” not to reflect poorly on the performance of the individual, but the fact is, the average consumer, they were just whipped around.Dayen: Let’s just bring a broader frame to this. We’ve seen in the last year, whether it’s Bernie Sanders or Donald Trump, people engaging with this idea that the game is rigged, the economy is rigged against them, rigged against the little guy, it’s set up for big, powerful interests. I don’t think there’s a better example of that than this story. The fact that these giant banks got caught using false evidence in these foreclosure cases, and that they got away with it, with nobody going to jail, no one having to give up a dime of their bonus, and these banks operating on business as usual after getting slap-on-the-wrist settlements that were designed to come up with a big headline number, so the Justice Department can say, “We got tough on the banks,” but the actuality of the thing—the number was far smaller.

This is the frustration people have, the idea that who you are matters more than what you did with respect to the Justice system. That there’s a two-tiered kind of system of justice, where the rich and the powerful have one system, and the ordinary schmoes have another. That is what is animating this frustration and anxiety that I think we see playing out in our politics, and if we don’t get a handle on it—populism can rear its head in left-wing ways and right-wing ways, and we’re seeing that play out right now, and we’re going to see this prairie fire continue to catch, unless there’s some responsibility done, where everybody is equal under the law.

Scheer: I think I was going to ask you why you bothered to write a book, because these days, not too many people read them or take them seriously, but your book provides great ammunition for those who in a sincere way ask the question, “How did this happen? And what is the cost?” I would recommend it, “Chain of Title” by David Dayen, not just because I want to push books because I like books, but because if you don’t immerse yourself in this book—and it is a good read, I’m not suggesting—

Dayen: It’s really about people. It’s about these people who are pushed to the limit, and they decide to take on something greater than themselves.

Scheer: And you write it like a novel, you know? She’s in the car, and the waves are coming up; it’s fun to read. I want to recommend it.

Dayen: Well, I didn’t want to bore everybody with mortgage details. It’s about people.

Scheer: No, no, no, it’s a great read. But, when you read it, you also get really angry, and you understand why there are so many people now—went to, as you say, the progressive side of Sanders, or went to Donald Trump’s jingoism and scapegoating of immigrants who had nothing to do with this. Actually, immigrants were fleeced with abandon by the banks. I want to ask you one question about who are the good people here? And it’s funny, because my book and your book were both distributed by something called Perseus Press, and you’re published by New Press, and I was published by Nation Books, but the people actually marketing, getting it out there, Perseus Press. Perseus is a hedge fund that has done all sorts of horrible things, but we can leave that aside, but the guy who was head of it, Jimmy Johnson, was head of Fannie Mae, and he was the fellow who sort of—he’s a good liberal who worked for [Walter] Mondale, and he’s the guy who presided over this fleecing of much of America.

Dayen: This is the problem.

Scheer: Well, let’s cut to the chase of this problem. Who really are the good people? We know Elizabeth Warren has fought the—Brooksley Born fought the good fight, there are people—

Dayen: Sheila Bair, even though she was a Republican, she was fighting on this. These individuals are the heroes, and they need to be recognized: Lisa Epstein, and Michael Redman and Lynn Szymoniak.

Scheer: Okay, but they don’t have the power even of—

Dayen: Well, let me just stop you there, because these three people didn’t have any institutional power, resources, knowledge, anything like that, but they started this movement. They used the power, the digital tools, the online tools, they started their own websites, they built a coalition, they researched the evidence, more than any state or federal prosecutor, and they built a fact pattern. We’ve seen that replicated after that, whether you’re talking about Occupy Wall Street, or you’re talking about the Sanders movement. I feel like these movements—these accountability movements, or anti-bank, or whatever you want to call them, on up to the fight for $15 an hour, the low-wage workers movement—they all kind of work in the same way. They use the digital tools to congregate and get together and push out a fact-based set of ideas, and try to make change. And they don’t always achieve all of their goals. Sometimes they don’t achieve any of their goals, but they—each one gets a little bit closer and a little bit closer and a little bit closer to the shore. And I feel like without these three individuals, and without this foreclosure fraud movement, you don’t have Occupy, and you don’t have what Sanders was able to do, and you don’t have the Elizabeth Warren wing of the party, and you don’t have Democrats up and down the line yelling about Wells Fargo in Congress, and their fake-account scandal.

Scheer: That is the importance of “Chain of Title,” your book, there’s no question about it. It’s a great tale of citizen resistance and citizen self-empowerment. It’s what the American experiment is supposed to be all about. Checks and balances, challenge to powerful. What is depressing about this whole tale is there’s a truth that Paulson, who was Treasury secretary under—

Dayen: Hank Paulson?

Scheer: Yeah, Hank Paulson, that was Treasury secretary under George W. Bush and had been head of Goldman Sachs, and he described in his own book, he walks into the office as the housing meltdown is underway, and George W. Bush, President Bush turns to his Treasury secretary and asked the former head of Goldman Sachs, he says, “How did this happen?” A sincere question—the president of the United States—”How did this happen?” And Paulson said it was an embarrassing question to ask me because we were the ones who did it. So here’s Hank Paulson, accepting responsibility on the part of Wall Street, and speaking to his shame. Why do so many of our leaders in the Democratic Party, Republican Party, in the mass media, deny a truth that Hank Paulson asserted: “Wall Street did it?” The contradiction here is you can have an aroused citizenry, but if they—Wall Street controls the power. And it’s not just Wall Street, it’s GE Capital that did so much housing, and the head of GE was appointed by Obama to be head of his jobs committee. It’s General Motors Acceptance Corporation where the—

Dayen: GMAC is all over the book.Scheer: All over the book, and so, what is brilliant—I think I’ll use the word “brilliant”—about “Chain of Title,”—so let me fully endorse it—is that you show how when the little person is being screwed, it is actually by the biggest of corporations, with the most powerful political allies, and what I was getting at with my thing is not to disparage that, but to ask where are the organizations that are—where was the Black Caucus? Where are the progressive politicians? Where were the trade unions?

Dayen: I think I asked that in the book. These three people did everything that a civics class would say, “This is how you make change.” You get the evidence, you build a coalition, and you go through the authorities that were put together to deal with this, and they went to everybody, from the Black Caucus to the—everybody from a county clerk on up to the president of the United States. The fact that they did everything right, and got it in the hands of the people who were supposed to do something about this, who were charged by us, the body politic, with doing something about this, the fact that it didn’t work is what we have to reckon with, and it’s why we have this angry electorate right now. So I feel like this is almost a cautionary tale for those elites that think they can get away with this over and over and over and over again, that this is what you’ve spawned. This is what you’ve created in the country. And they can’t get their heads around “why are people so angry? Why are people so angry?” Here it is, this is why people are so angry.

Scheer: That is really the power of this book, because the anger is not leading to effective change. It won’t go away, but what will happen, and this—I almost feel like we’re talking about Germany after the Weimar Republic, when people are running around with wheelbarrows full of marks and can’t buy food and they don’t have jobs. What you’re describing are people who—yes, now they’re fighting in a positive way to understand their mortgages, and survive economically, but you could see the three people in your book going through a Trump alternative. They don’t have to end up with a progressive alternative.

Dayen: They don’t at all.

Scheer: And there are plenty of people—see, what bothers me about this election is because Trump is such a buffoon and so obnoxious that the whole phenomena goes unexamined. Why were all the Republican candidates rejected for this guy? Because he was anti-establishment. He claimed to be, not that he is.

Dayen: Because he spoke to a certain despair that’s in the country after globalization?

Scheer: Yeah, but that despair was mocked by Hillary Clinton, who talked about—reflected poorly on who had supported Trump. They’re hurting! Just like the people—

Dayen: This idea that America is already great, that’s her rhetoric to Donald Trump.

Scheer: But I looked at the Sanders campaign and everybody said, “Wow, he did great.” I thought he’d get 2 to 3 percent of the vote. I really did. I thought he’d be blown away, and then he gets—where does he get—he gets it from working-class people, he gets it from people who would never dream of—

Dayen: And from young people, who have been on the front lines of this their entire adult lives.

Scheer: I think this last point you made is a very strong way on which to wrap up this podcast and give people a reason to really care about this subject. It’s not going to go away, and neither candidate—major candidates in this election—are going to address it. We don’t have public finance of campaigns. Wall Street money is now more important to the Democrats than even the Republicans for all the—”Oh yeah, the Koch brothers, the Koch brothers, the Koch brothers,” “Citizens United, Citizens United, Citizens United.” The fact of the matter is both Obama and Hillary Clinton have been great at getting money from Wall Street. Wall Street knows they’re on their side, they know they’ll carry their water.

So the real danger here is where are we going to be four years from now, eight years from now? When you have so many people out there that feel ripped off by a system, they’ll get desperate, and they’ll accept a demagogue of the right as easily as they’ll accept a legitimate populist from the progressive side. That’s really the danger. And maybe if you want to tell us in closing what you think people can get from this book, and why they should pass it around or talk about it with their friends?

Dayen: I think a couple things. Number one is that this is our history. This is something that I didn’t get down the memory hole. I really wanted to look at this from the lens of the ground level of homeowners and recognize the contributions that these people made and how they really should have amounted to a lot more.

And the second thing is that the administration and top officials, they make a lot of alibis and excuses for themselves. “Oh we didn’t have enough good cases.” “What happened on Wall Street was unethical, but it wasn’t illegal.” And this is a book-long response to that—that we had an alternate history, it wasn’t just that—it was a choice that was made. The choice was made to let these guys off the hook. It was optional. It was not an affirmation. There was an alternative here that could have gone up to the top executives on Wall Street, and held them responsible. Ordinary people figured it out and laid it out and handed it to state and federal prosecutors on a silver platter, and ultimately, they determined that it wasn’t worth their time to do anything about, and we have to think about that.

Scheer: Yeah, and we have to think about that Title III of a bill that Bill Clinton signed into law that said, “No regulatory agency, and no existing law will govern and control the marketing of these collateralized debt obligations, these mortgage-backed securities,” which ended up being one of the great Ponzi schemes and scams of world economic history, and if the Mafia had done it, they’d all be thrown in jail and never allowed out for even a walk in the yard.

I want to thank you. The book is “Chain of Title,” David Dayen. It’s really worth reading, and when you think the election is getting a little tedious, pick up this book, think about it, think about what’s left out of the discussion, and I want to thank you for coming in.

This is another edition of “Scheer Intelligence”, my producers are Josh Scheer, and Rebecca Mooney over at KCRW, Kat Yore and Mario Diaz at KCRW are the engineers, and we are broadcasting from the USC Annenberg School for Communication and Journalism where Sebastian Grubaugh is the terrifically brilliant engineering type who helps us make this possible.