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FDL Book Salon Welcomes James B. Stewart, Tangled Webs: How False Statements are Undermining America: From Martha Stewart to Bernie Madoff

Welcome James B. Stewart, and Michael W. Hudson, author of The Monster.

[As a courtesy to our guests, please keep comments to the book.  Please take other conversations to a previous thread. -bev]

Tangled Webs: How False Statements are Undermining America: From Martha Stewart to Bernie Madoff

Michael W. Hudson, Host:

One lie leads to another.

In heady days of the Great American Mortgage Boom, loan salesmen lied to borrowers. The salesmen and other mortgage workers made the deals go through by fabricating documents and forging signatures. Quality-control folks up the line ratified the lies by signing off on deals that they knew – or should have known – were tainted with fraud. Capital markets executives misled investors about the quality of the borrowers and the loans. Investors lied to themselves – and sometimes their financial backers – about the kinds of toxic mortgage waste they were buying. Much later, it emerged that people working on behalf of the nation’s largest banks had perjured themselves by signing false affidavits that sped borrowers into foreclosure.

Rarely do lies simply go out in the world and stand on their own. To have staying power, they require a complex network of ancillary lies and human enablers (sometimes knowing, sometime unwitting) who create a web of falsehood. These tangled webs can drain families’ bank accounts, get people killed, cause great institutions to fall, even help crash an economy.

In his new book, Tangled Webs: How False Statements Are Undermining America, Pulitzer Prize-winning journalist James B. Stewart tells the story of four convicted dissemblers: Martha Stewart, Scooter Libby, Bernie Madoff and Barry Bonds.

The stories he tells, though, are about more than individual liars, or about what he describes as a rising tide of lying under oath – perjury – at the highest levels of business, media, politics, sports and culture. They’re also about complex swirls of untruths that build on one another, confederates who lie to protect the liars from their lies, and people who believe lies or false information because political ideologies or financial incentives predispose them to believe.

On Jan. 28, 2003, President George W. Bush uttered 16 words whose essence was later shown to be false: “The British government has learned that Saddam Hussein recently sought significant quantities of uranium from Africa.”

As Firedoglake readers know, those 16 words helped nurture the false impression that Iraq was stockpiling weapons of mass destruction that could be used against Americans, helping to push the U.S. into a bloody war that has yet to end.

The 16 words in question also created one of the biggest scandals of the Bush presidency. Former U.S. diplomat Joseph Wilson accused the Bush administration of ignoring his findings from a fact-finding mission that had convinced him that Iraq hadn’t sought uranium in Africa. In response, administration officials spread the word that Wilson’s wife, Valerie Plame, worked for the CIA, suggesting she had arranged the African trip as a junket for her husband.

When it became clear that these officials had outed an uncover intelligence operative – a crime under U.S. law – the ensuing investigation produced a number of dubious statements from high-level government executives about what they’d said and when and why they’d said it. Libby, Vice President Dick Cheney’s chief of staff, was convicted of lying about his role in leaking Plame’s identity.

In trying to make sense of the deceptions by Libby and the other characters in his book, Stewart suggests that America is “on the brink of becoming a society where perjury is the norm.” One assistant U.S. attorney told him that he came to work every day expecting to be lied to; the only question was how well told the lies would be.

While street criminals have always tried to mislead authorities about their activities, Stewart says that prosecutors told him that “a surge of concerted, deliberate lying by a different class of criminal – sophisticated, educated, affluent, and represented in many cases by the best lawyers – threatens to swamp the legal system and undermine the prosecution of white-collar crime.”

Stewart, author of Den of Thieves and other books about politics and business, believes the consequences for our nation and our society could be devastating.

“Lying under oath that goes unproven and unpunished breeds a cynicism that undermines the foundations of any society that aspires to fair play and the rule of law,” he writes. “It undermines civilization itself.”

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Michael W. Hudson

Michael W. Hudson

Michael Hudson covers business and finance for the Center. He previously worked as a reporter for the Wall Street Journal and as an investigator for the Center for Responsible Lending. Hudson has also written for Forbes, The Big Money, the New York Times, the Los Angeles Times and Mother Jones. His work has won many honors, including a George Polk Award for magazine reporting, a John Hancock Award for business journalism and accolades from the National Press Club, the White House Correspondents’ Association and the American Bar Association. He edited the award-winning book Merchants of Misery and appeared in the documentary film Maxed Out. His new book, THE MONSTER: How a Gang of Predatory Lenders and Wall Street Bankers Fleeced America—and Spawned a Global Crisis, will be published in October by Times Books.