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The release of the latest Epstein files triggered a deluge of revelations, spelling the end for one of UK’s biggest political characters. Nish and Coco chat about Lord Mandelson’s fall and the damage done to Keir Starmer and his government as well as the new police investigation into Andrew Mountbatten-Windsor.

Economist Ann Pettifor, one of the few who predicted the 2008 financial crash, is the author of a new book “The Global Casino”. She has a lot to say about the Mandelson scandal, the financial systems that control our lives and what governments need to do to challenge the global billionaires who speculate with our money every day.

Plus – move over Barbenheimer, Nish and Coco give their take on two premieres: The Moment and Melania.

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TRANSCRIPT

Nish Kumar Hi, this is Pod Save the UK. I’m Nish Kumar.

Coco Khan And I’m Coco Khan, police are investigating after the latest Epstein files apparently showed the leaking of sensitive financial information by Lord Mandelson when he was in government.

Nish Kumar You know it’s bad when a photo of Peter Mandelson in his pants is the least horrifying bit of info that’s coming out. We’ll break it all down.

Coco Khan And the economist who predicted the global financial crisis is at it again with her new book. Ann Pettifor will join us to talk about the winners and losers in the global casino. Spoiler alert, the winners are probably already billionaires.

Nish Kumar Now, Coco, eagle-eyed viewers and maybe very, very eagle-eared listeners might have noticed that you and I are not in the same room currently.

Coco Khan Do eagles have really good hearing?

Nish Kumar I actually don’t know. What’s something that has good hearing? Mothers when you’re saying rude things about them in the next room. That’s the one. That has good hearing. The eagle-eared mothers.

Coco Khan Yes. The eagle-eared mothers will know that I’m not in the studio this week. I am beaming in from a, uh, I’d love to, I wanted to say somewhere really tropical and amazing, but I’m just in my in-laws house. So if you hear a landline, uh they still exist here. Enjoy this blast from the past. Well, I’m sad not to be there with you, uh not least just so we can console each other over what is genuinely some of the most horrifying news I’ve seen and we do this podcast every week.

Nish Kumar We’ve been one of the worst news weeks, I think you’re right, of the entire lifespan of this show. Look, it’s hard to overstate the importance of the newest revelations from the Epstein files. We’ve got a Secretary of State leaking confidential, market-sensitive government information to a convicted sex offender who apparently used it for financial gain and influence.

Coco Khan And quite often, understandably, when you hear these tales, you focus on the offenders, you know, it’s monstrous acts and you wonder why. But I really think we need to put at the heart of this story is the victims, the victims of Epstein and the people around him who took advantage of his money and his influence, those women are still fighting for justice. And these new documents will hopefully get them closer to that.

Nish Kumar There’s now a police investigation, there’s growing pressure on key figures to give evidence in the US and more and more questions about our Prime Minister’s judgment. Keir Starmer told the cabinet that he was gobsmacked by the appalling revelations and here’s what he said today about what we’ve heard so far.

Keir Starmer That Mandelson betrayed our country, our Parliament and my party. Mr Speaker, he lied repeatedly to my team when asked about his relationship with Epstein before and during his tenure as ambassador. I regret appointing him. If I knew then what I know now, he would never been anywhere near government.

Coco Khan Now, Lord Mandelson used to be seen as some kind of political genius, so much so his nickname was the Prince of Darkness. He was instrumental in the rise of new Labour in the 90s and stayed close to the heart of the party, mentoring and advising younger politicians as they rose through the ranks to positions of power.

Nish Kumar Even when he first appeared in the notorious Epstein files, he was able to explain and excuse his links to a convicted sex offender. Here he is speaking to the BBC’s Laura Koonsberg after he was first sacked as US ambassador.

Lord Mandelson While it’s had the most calamitous consequences for me, the crux of this is not me. The crux is not the friendship I had 25 years ago with Jeffrey Epstein. The cruks of this, is that so many hundreds of young women were completely trapped, powerless in a system that did not listen to what they had to say.

Nish Kumar Not everyone was convinced, but now following the release of more emails from the files, the picture looks even more damning than they could have assumed. He’s previously denied any wrongdoing.

Coco Khan There are a lot of claims and more are emerging all the time as people review the new documents. There are more than three million to get through. The new allegations come from a load of emails between the two men. Mandelson gave Epstein advance notice of a 500 billion euro bailout from the EU during the global financial crisis. He sent internal government information about the state of the UK economy in 2009. Also in 2009, he lobbied the Treasury on banking policy at Epstein’s suggestion. And he even… Told Epstein that J.P. Morgan should mildly threaten the UK Treasury over bankers’ bonuses. At the time, it was reported that the bank had threatened to pull plans for the bank’s new UK headquarters. So what happens now? The Met Police has launched an investigation into allegations of misconduct in public office. Peter Mandelson has resigned from the Lords and the Labour Party and Keir Starmer has started the process of drafting legislation that will strip him of his title.

Nish Kumar But it doesn’t stop there. The European Commission said on Tuesday that it would investigate Mandelson’s time as the European Trade Commissioner between 2004 and 2008. He’s also resigned from the Labour Party in a letter on Sunday. In it, he specifically refers to an allegation that Epstein made financial payments of around $75,000 to him between 2003 and 2004. He claims those allegations are false. And that he had no recollection or record of them, though he has remembered a 10,000 pound payment from Epstein to his partner in 2009 to pay the cost of an osteopathy course, which Mandelson described as a lapse of judgment. This whole story also attacks the very premise of Peter Mandelson. Peter Mandelsons is a figure that has sort of, you know, haunted politics most of our adult lives, Coco. But the premise of Peter Mandelson and this idea that he was the Prince of Darkness, which is a nickname he acquired in the 90s under New Labour, is that he is a person well-versed in the quote unquote dark arts of politics. And the reason that people were comfortable with his deployment of said dark arts is because he was trying to advance a progressive political cause and trying to get a Labour government elected. Now, this story completely dismantles. The very idea, the purpose of Peter Mandelson. He was not trying to advance a progressive political course. It’s all very well and good for Mandelson to claim that he’s now thinking about the victims and centering them. He doesn’t seem to have been particularly concerned about the victim or centering the based on an email exchange that the Daily Mail has reported on from these Epstein files. The email exchange is after Epstein was released from prison with this exchange about Epstein celebrating with two strippers. Mandelson asks him how is freedom feeling and Epstein says she feels fresh, firm and creamy. I actually stumbled over that because it’s quite hard physically to read that out loud and Mandelson responds naughty boy. Now remember this was after Jeffrey Epstein had been released from prison on sex crimes. I can’t believe I’m having to say that but that is the situation that we find ourselves And secondly, it’s not particularly progressive to, on instructions from said pedophile, be lobbying the Labour government in 2009, as Mandelson appears to have done based on these email exchanges, on behalf of JP Morgan to attempt to water down legislation the Labour Government is trying to pass and protect bankers’ bonuses. It is a serious question for Keir Starmer about his political judgment. It is really serious question because lives have been destroyed. People are dead. Women were sexually assaulted and sexually exploited. If we’re really taking violence against women and girls seriously, which we supposedly are as a society, we have to question how seriously we can be taking it if given what we already knew about Mandelson’s relationship with Epstein, the Prime Minister of this country was willing to give him a job as an ambassador to the United States. Listen, before we move on, let me just say, and I just want to say, I’m saying this entirely of my own volition. I just feel like I have to bring this up. Peter Mandelson denies all wrongdoing. So I’m just bringing that up with my own accord and in no way am doing that because we are legally obliged to. That’s just something I wanted to throw into the mix.

Coco Khan I just want you to throw in there.

Nish Kumar You know, sometimes it’s nice to bring in a denial of wrongdoing, you know, when you allege to have lobbied on behalf of the banking industry on the instructions of a pedophile. Sometimes it’s to throw in the denial that you’ve issued so far. Anyway, let’s move on.

Coco Khan Let’s move on next up. So we have Andrew, Prince Andrew, Andrew Mountbatten-Windsor and a new police investigation after a woman told the BBC that she was trafficked to the UK for sex in 2010, added to the latest truly grim photos from the Epstein files show the former Prince kneeling over a fully dressed woman who is lying on the floor. I’m sure we’ve all seen the pictures. They are absolutely chilling.

Nish Kumar Calls have grown for him to give evidence to the United States Congress over his links to the convicted sex offender. Keir Starmer has backed those calls saying that Epstein’s victims have to be the first priority.

Coco Khan Emails from Andrew’s ex-wife Sarah Ferguson to Epstein were also released, in which she calls him the baby brother she always wanted, and in another she thanks him for his generosity and kindness. All of these emails were sent after his conviction for child sex offenses, but they do not imply any wrongdoing. I think probably they’re going to say that they didn’t know about the conviction, but everybody knew about the convictions, particularly in that circle, that kind of high-profile circle, isn’t? Anecdote that’s being reported in the FT actually, that the journalist, Tina Brown, was invited to an Epstein dinner in 2010. She’s reported to have said, “‘What the fuck is this, the pedophile bull?’ Which just gives you an insight into how many people within the media certainly knew that this conviction had happened. So the idea that his close friends didn’t, just doesn’t stand up to scrutiny.

Nish Kumar Absolutely astonishing. Just to clear up, we talked a lot about Jeffrey Epstein’s convictions and what people knew and what they didn’t know. In 2008, Epstein pled guilty to charges of procuring a child for prostitution and soliciting a prostitute. Now this was done as a plea deal, even though federal officials had identified a total of 36 abuse victims, some as young as 14. He served almost 13 months in custody. So that’s 2008. He was then arrested again in Florida in July 2019 on federal charges for sex trafficking and minors in Florida and New York. And a month later was found dead in his cell. So when people say they didn’t know, they certainly knew in 2008 that he had pled guilty to charges for procuring a child for prostitution. So again, the sort of obfuscations and explanations are pretty nauseating. And it’s hard to even start to imagine how Epstein’s victims are feeling this week.

Coco Khan Very briefly, when we were on a break from this record, I went onto the DOJ’s website. I don’t know why I did this. And I just typed in Me Too, just to see. Was Epstein talking about the Me Too movement to anyone? And yeah, he was. I mean, there were so many emails. I only had like a first pass on like the first couple of pages. But it was like nauseating to see him talk to Woody Allen’s wife about how Me Too Movement had gone too far. And I felt like screaming at the computer, the MeToo movement did not go far enough, my friend. I really seriously hope we see some actual consequences for this. So anyway, Keir Starmer, his trip to China, that feels like a really long time ago, doesn’t it? He was in Japan as well. That was seen as a pretty successful visit. He was barely back before the news broke and he found his decision to appoint Peter Mandelson as the UK ambassador to the US under the spotlight once again. Labour just, they just love bringing this guy back. This is his fourth resignation, if resignations also include being forced to quit.

Nish Kumar It’s also a massive headache for Starmer’s chief of staff, Morgan McSweeney. Mandelson was his mentor and reportedly McSweeney promoted his move to US ambassador. As we’re recording at 11am on Wednesday, the news has broken that Starmer is going to attempt to try and get ahead of this latest turning of the wheel in this scandal. So he is going to release files relating to Mandelson’s appointment as Britain’s ambassador to the US. And the government ministers apparently described this as drawing a line in the sand. The Conservative Party was preparing to force the publication of the records, including what Mandelsohn may have told Stammer about his relationship with Epstein. But instead of facing that vote, Starmer has ordered the publication the records. So that’s going to be emails, documents and messages. There will be some that are redacted, that are deemed prejudicial to national security or that could. Damage diplomatic relations. So I imagine as with a lot of the revelations relating to Epstein, when those are released, there will be some controversy and scrutiny over what has been redacted here. I mean, you know, we’re talking about kind of international crisis of trusts and government and you know this kind of rise of conspiracy theories and conspiratorial thinking. You try and fight really hard to defend principles of trust and accountability and say to people, you can’t allow that to be eroded, you know, and we talk a lot about social media algorithms eroding trust and that is true and really important. But I mean, sometimes it’s really fucking hard to tell people that they should have confidence in government and not believe conspiracy theories when this kind of information is revealed.

Coco Khan You and I are, I don’t like this word, but in many respects, we could say we are reformers in the sense that we want to see things get better. We want to say standards actually upheld. I understand how people are like, just rip it all up and it cannot be fixed. The foundations are rotten. Someone like Peter Mandelson, given how many times he’s been in and out of the Labour Party, you would understand why people would say his fingerprints are simply too much over how the Labour Party thinks. How they operate, it cannot be redeemed. It can no longer be the progressive party that we want it to be anymore. And yeah, I mean, the conspiracy theory stuff, Pizzagate was mocked, wasn’t it? People made fun of it. And actually, a pedophile ring of elites, the truth was far more fucked up than anyone could have thought.

Nish Kumar I remember people making jokes at the time saying, has he been appointed as U.S. Ambassador because him and Trump both spent time on Pedo Island? Like I literally remember people saying that stuff at the same time. It wasn’t like we weren’t all aware of this. Even if Stalman knew what we all knew, that should have been enough to say that he wasn’t, you know, and there were also people applauding him for, you know, wow, this is a very canny piece of political maneuvering, you know, for a star to have done this. He’s fucking kidding me. He’s absolutely grotesque.

Coco Khan I just also want to mention, just while we’re here talking about the Labour Party, it’s not been a great week for them. Aside from this, Dan Norris, a former Labour minister and now an independent MP has been arrested for a second time on suspicion of rape, sexual assault, voyeurism and upskirting. Meanwhile, Tulip Siddique has been sentenced to four years in jail in Bangladesh for corruption charges. My god.

Nish Kumar Not a good week for the Labour Party.

Coco Khan Also, you know, I mentioned I went onto the DOJ to have the experience of typing this in just to be horrified and mortified in this historic way. I also searched for Nigel Farage and his name comes up, but what I saw was just articles written about him being circulated. But it did actually make me think, he’s been quite quiet on this, hasn’t he? He’s not said much about it. I thought we really cared about the women and girls.

Nish Kumar Yeah, I mean, I think it presents a problem for Nigel Farage because of his consistent close personal relationship with. Donald Trump, also his personal relationship with Steve Bannon, who sort of featured pretty repeatedly in the Epstein files. I mean, I think I imagine I speak for a lot of people this week, who once again have found themselves going, what the fuck, Noam Chomsky? Are you, what in the name of God? Anyway, Not hugely relevant to what we were talking about, but I feel that I’m going to take it as a guess that I am articulating a lot of what people who are listening to this currently are saying this week. Just an important reminder, obviously, being in the files, we have to be clear, doesn’t imply wrongdoing. So look, after the break, I’m gonna chat to the economist who called the 2008 crash and metaphor about the manlessness and allegations where we place our bets on when the AI bubble Burst and her new book about what she calls the Global Casino.

Coco Khan [AD]

Nish Kumar So the Epstein files have given us a flavor of the way in which elite financial interests, the distortion of state functions and gender imbalance converge to undermine the rule of law. Now, Ann Pettifor, the economist who predicted the 2008 crash and was one of the architects of the Green New Deal, has written a new book which explains how this very same global elite have also rigged the financial system. Ann, welcome to Pod Save the UK.

Ann Pettifor Thanks, Nish. Great to be here.

Nish Kumar It’s a hell of a thing. Is it a weird thing to walk around with that tag of the person who predicted the 2008 crash?

Ann Pettifor Yeah, it is a bit, really, because actually quite a few others predicted it as well. But I must say, I’m one of the few women that did. You know, I’d written a book called The Coming First World Debt Crisis, and I said it felt like a lead balloon. I mean, that was a book that didn’t sell. And everybody just said, oh, she’s that old lefty, don’t take any notice of her. But then amazingly, after the crisis broke, people began to say, oh that little woman, so that’s been quite nice.

Nish Kumar Okay, well, it’s a book that didn’t sell is an incredible way to open a conversation that starts with your new book.

Ann Pettifor Yeah.

Nish Kumar Your new book is called The Global Casino. It’s absolutely brilliant. Before we talk about the issues it raises, just spell out to us the concept of The Global casino.

Ann Pettifor So I wanted to make people aware of something economists call the International Financial and Monetary System. And I want ordinary people, when I say ordinary people I mean me and you to understand that this is like a sort of construction. This is a construction, it’s a kind of architecture. And I envisage it as a casino because actually there’s so much gambling that goes on in there. But what I want to show people is that this like a giant casino. And inside the casino are little booths, and these are countries, you know, this is Britain, this is France, that’s the United States, China, that’s South Africa, this is Sierra Leone. And they’re inside this giant casino, and people inside the booths scarcely aware of the fact they’re in a casino. The key thing about the booth is, is that they’ve got their doors wide open and they never close their doors, with the exception of China. And so people in the casino, which are mainly gamblers, speculators or what are they called? They’re called in the financial system, but also gagsters, the mafia, terrorists, drug dealers. They’re all, you know, swanning around inside the casino and they can. Dip into the doors, through the doors into our economies and out again without any friction. But in reality, it means all these speculators plus all the criminals associated with the casino are sort of doing us huge harm and we don’t know it exists. And partly that’s because it sounds like something remote. But, and I wanted to make it into a territory and I want that territory to take shape and the shape is a casino. And a key thing, and here we get back to dear old David Graeber, is that we constructed that casino, and we can just as easily deconstruct it and reconstruct another system.

Nish Kumar Derivatives market, there’s people investing in speculation essentially, but one of the most alarming things about the book is how it explains how your pension is part of that investment. They’re not gambling with their money a lot of the time, they’re gambling with your money. And how was that, say just specifically taking the example of the UK, how did we get to the point that that has been allowed? What measures of deregulation have brought us here.

Ann Pettifor So it starts with the privatization of pensions in Chile back in the 1970s. And Mrs. Thatcher gets wind of this and thinks, oh, why don’t we do that too here? And Blackrock comes along and scoops up our pensions and says, leave it to me. I’m going to invest your pension in, I don’t know, the US dollar, which never falls in value. And all, you know, in whatever gold or silver or whatever I think would make you more money. And we say, fine, here it is. So we’re extremely vulnerable. So the point of the book is to say, this system impacts on you, dear reader, on a daily basis, your pension, the price of your food, because, you know, all these agricultural goods that are traded, and energy. These are key things, not to mention house prices, you know. That open door means capital can flow into your country and inflate the value of your properties and make, render you homeless. And because we’re ignorant of that, we blame our neighbors, we blame supply and demand, but we don’t blame the system.

Nish Kumar Is a very interesting week for you and me to be having this conversation because journalists around the world have been digging into the Epstein files and we’re getting some sense through this story of the architecture of this kind of shadow banking system that the book points out. In the book you write about how the globalized financial system operates beyond the reach of regulatory democracy and the law. So one big revelation this week has been Peter Mandelson leaking sensitive information to Epstein and the police are reviewing claims that when he was business secretary, he gave advance notice to Jeffrey Epstein of a bailout from the European union. Now, and can I just take a guess that you have not necessarily been as surprised, say, as some of us have been by some of the revelations, not, not just this EU bailout, but also the fact that Mandelsohn… Seemingly at the instruction of Epstein, was lobbying about bankers’ bonuses in 2009.

Ann Pettifor What’s really bugging me at the moment, Nish, is that none of the big media outlets are focusing except for the Financial Times. And Jim Pickard must get real credit for this. Nobody’s focusing on the fact that this is a Wall Street story. This is a banker’s story. And they wanted to attack the post-crisis regulation. Now we were watching all this from here. And there was something called Dodds-Frank, where finally the government said, after the great financial crisis in which millions of people lost their homes, their jobs, they suffered divorce, they committed suicide. After all of that chaos, we’re not gonna manage the system. We’re gonna regulate it. And then as we watched them talking through Congress, talking through Dodds Frank, we noticed that it was being diluted. And we wondered, you know, I blamed all the Americans. I kept going on about those Americans, blah. Turns out it was a Brit.

Nish Kumar Who says we’re a waning global power and.

Ann Pettifor Exactly. I mean, so then, you know, there am I being so unkind about those Americans. It turns out it was the Brits.

Nish Kumar You write about how in 2021 the world lost $144.8 billion in tax revenues to tax abuse related to offshore financial wealth. Now, there are allegations that Epstein was part of a system that created offshore structures for powerful people. What are the implications for the structures of democracy and the rule of law when Capital essentially supersedes the will of democratically elected governments.

Ann Pettifor You’ve just told the whole story of the book. That’s what the book’s about, really.

Nish Kumar Spoiler alert, spoiler alert warning.

Ann Pettifor But the point is this. I get so annoyed with, you know, I’m on the left, and I have to say, the left are pathetic. They keep going on about wealth taxes. You know, what a joke. You’re in this little booth called Britain inside the casino, and you’re worried about how you’re gonna tax these guys going in and out of your economy. The idea that you’re going to say we’re gonna tax you and they’re gonna sit there and be taxed is ridiculous. They’re taking their profits and their capital gains into tax havens, the minute you mention it.

Nish Kumar What does a kind of legislative response look like to actually close those doors down? Is it international cooperation?

Ann Pettifor It’s called macro prudential rules, basically. And if I could give you an example of one, I noticed the other day that Elon Musk threatened he was going to buy something in Europe. Oh, Ryanair, that’s right.

Nish Kumar I don’t even know how he’s managed this, but he somehow managed to get in a pissing contest with Michael O’Leary, the owner of Ryanair.

Ann Pettifor Exactly. And what happens? The European Commission says, sorry, you’re not allowed to do that. That’s a capital control. That’s saying we’re closing the door to you, Elon Musk, when it comes to our airlines. These are things that the central bank can do, that government can do. You know, that the European Commission or the British government can do to sort of manage. I’m not against money flowing in and out, because we all want to go on holiday to Costa Rica, for God’s sake. What we need to do is manage those flows. And I always say, can you imagine the boss of Apple saying, I’m not gonna manage flows in and out of my business, you know, I’m gonna leave it blah. Nobody would do that. And we do that, our governments do that as a matter of policy. And the deregulation, the key thing happened in 1971, when effectively the JP Morgans of this world persuaded governments to lift any management of capital flows. You know, of the regulatory book and we did. We obliged the financial system. They can’t believe their luck. Nor can drug dealers. If you’re running county lines and you’re looting young men, vulnerable young men of all their money and you want to transfer it back to Colombia, nobody’s going to stop you. And we sit around and don’t worry about that. Sorry, I get very hit up about this.

Nish Kumar No, that’s fine. Getting Het Up is the sort of raison d’etre for this podcast. It’s absolutely fine. It is a show presented by people who get het up and listened to by people who are getting het up. So it’s absolutely fine for you to be het up! I want to come back, well, I don’t want to go back to Elon Musk. I never want to speak about the man again, but I’m obliged to come to Elon musk. But before we do, the 1971 incident that you’re referring to is really important to the core of the book. It’s when the Nixon government essentially moves the economic system away from and essentially abandons the principles of Bretton Woods, right? Can you just briefly explain that? Whenever I read stuff about this subject, we’ve always identified, you know, things like the Pinochet Chile government. We’ve always identified Thatcher and Reaganism and talked about post-1979 economics. This was not something I was aware of. I was not aware of the significance of what the Nixon government did. Could you just briefly outline that.

Ann Pettifor Yes, and we love to talk about the politics of this stuff, you know, and I’m saying talk about the economics of it, because the economics is highly political. So after the war, Keynes and a bunch of economists at Bretton Woods had sat down. It was really interesting. Roosevelt refused to allow any Wall Street bank to attend the Bretton woods conference. It was only economists from the north and the south, actually. Which again, is such an important precedent. 45. They looked back at the 1930s when they had these vast bubbles, when they had the 1929 crash, which was followed by a catastrophic world war, never mind unemployment, et cetera, et cetera. And they thought, you know, that was crazy. We must never do that again. So they sit around the table and they say, we’ve got to manage capital flows. We’ve got a manage this trade. We’ve gotta do that as well. And we’ve gotta manage the currencies that we use in trading. And they win most of the arguments on capital mobility. The Americans and the rest of the world agree we’ve got to manage capital cross-border flows. And they also agree that we must manage trade. Where they don’t agree is that the dollar should be the world’s reserve currency. That’s just what the Americans want, okay. Anyways, between 45 and 71 is a period known to all economists on the left and the right as the golden age of economics. It’s the Golden Age. Employment was high. Even the poor countries in Africa were expanding their economic activity and doing well. What happened then was America decides to go to war in Vietnam and they get into debt. They get into, and getting into debt in your own country where you’ve got a bank that issues the currency and manages the credit, amount of credit in the economy is one thing, but getting into depth with foreigners. Is another. You’ve got to repay your debts in a currency called the dollar, but the Americans are getting out of balance, right? And any low-income country will tell you they know what this means, because this is what happens when the IMF zooms into a country and tells them to structurally adjust their economy. The Americans would refuse to structually just their economy. They should have, if you like, stopped buying from abroad. And invested more at home, but they chose not to do that. They kept wanting to buy from abroad. And so the answer to that was to say, oh, to hell with this standard for balancing the books. We’re not gonna pay anymore. We’re gonna pay the dollars relative to gold. Nixon decided to do this without consulting the rest of the world. He goes on the television and said, we’re not going to repay our debts in the way that we promised we would do before. And if you don’t like that. Go and jump in the lake. And so they simply default on their obligations to repay their debts in the way that was agreed. And that’s the sovereign default. Economists won’t call it that. I don’t know why, but they don’t call us a sovereign default, but it’s what, you know, poor countries like in Africa do. That’s what the Americans did. But instead of the IMF flying in and saying, structurally adjust your common restore balance, they said, oh, well, you know, it’s the Americans. The only one who really disagreed with us was President de Gaulle. They sent a battleship to New York to retrieve their gold from Fort Knox. And they said, we don’t want your greenbacks. Because what Nixon said was, we haven’t got money to repay you in that way, but what you can do is you can borrow one of our government bonds. And if you hold that, we’ll pay it over 30 years. And you know, so you’ll get that in return for it. And as I say in the book, it’s like going to your tailor and saying, please make me a suit and paying your tailor, and then your tailor paying you back again. And you’re thinking, well, God, if I’ve got that money again, I’ll have another suit. And that’s how the Americans treat it. You know, you know, we, we lent them money. So they kept buying and consuming and consuming, and eventually huge imbalances built up.

Nish Kumar Right. Let’s look at Elon Musk and use him as a sort of way into discussing one of the biggest financial risks taken by Wall Street in the last few years, which is the gamble on artificial intelligence. It’s technology that doesn’t exist yet in real terms. Now, I’m not an expert. That doesn’t seem smart. It doesn’t see particularly wise and it feels like a huge bubble that’s about to burst. So with Elon Musk, SpaceX announced a $1.25 trillion deal this week to acquire XAI, which is a company also founded by Musk, which has announced last month to be the recipient of a $2 billion investment from Tesla, which is another company owned by Elon Musk. According to a Reuters source, XAI was valued at $250 billion. We’re talking about technology that doesn’t exist, and we’re talking about companies being bought by other companies owned by the person that owns all the companies. Please help me make sense of what’s happening here.

Ann Pettifor So you’ve got to start with Twitter and X, right? Okay. So he pays crazy, crazy money.

Nish Kumar Like, way over the odds, like…

Ann Pettifor Way out of the odds. Just to have the power of that platform. And it’s given him huge power, let’s face it. So what is he doing? He’s merging his companies to invest money effectively in Twitter, ultimately, to put some of their surplus into the deficit that Twitter’s built up. To be fair, he’s got a surplus in X-Space or whatever it’s called. But that’s all that he’s doing. This is where the crunch will really come from. Um, because what, what’s happening with AI is that all these big platforms have loads of cash because we’re just handing it over. You know, we hand over our data and they monetize that like crazy. And we are so happy for them to do that. They can’t believe how much money they’re really in. But what’s happened now that even though they have all that cash, they’ve actually run out of cash. Because it invested so much in this non-existent asset called AI. They’re now having to borrow, and they’re shifting that off the balance sheet, really. And the big, huge, big five corporates involved in AI, they’re competing with each other to deliver all this stuff, but they can only get better and compete with each other if they build more data centers. That means they need cash to buy land and invest in data centers which burns up huge quantities of energy, right, and put up our electricity prices probably in the end. And this is why Musk is talking about going to the moon and sticking his data sensor on the moon. You know, it’s complete bonkers madness, really. And it’s all, if I may say so, thanks to the casino.

Nish Kumar What you’re saying is we shouldn’t look at the AI bubble as something distinct or in any way separate. Yeah. And we should look at tech companies as being distinct or separate. They wouldn’t have that.

Ann Pettifor They wouldn’t have that cash if they couldn’t be siphoning it off every country in the world. And we’ve given them the whole world to play with.

Nish Kumar If the entire stock exchange in the States is kind of based around AI companies and companies like Nvidia that make the hardware, but all these companies are doing is essentially leveraging debts off different bits of themselves, then surely that is a bubble that’s going to burst. Is it 2005 again? Am I about to be 20 again? Will my hair go black again?

Ann Pettifor Yes, it is. Right. And what’s really difficult about a bubble is predicting when it bursts, really. And nobody knows what will be the trigger as well, because it will be some weird thing that will blow up from nowhere that you would not expect it to be, you know. But that it’s a bubble, you, it’s commonplace now. Yeah. I mean, everybody is saying it. There’s nothing clever about saying it, and you know, what’s also terrifying is And this is where. We have to understand our public institutions, because what I want to make clear in the book is that these guys operate in the stratosphere, but at the same time, they tethered to the Federal Reserve, basically. And Jerome Powell has said, and I quote him in the book, don’t worry, we’ve got all that it takes to bail them out, you know. If you have a central bank that exists to bail out these big bad guys, these very wealthy elites, the people will get angry, the people are pissed off about it, and they’re right. You know, we think the people don’t understand macroeconomics will completely roll. They get it, they can see what’s going on. You and I can see, what’s it going on, right? And they are mad as hell. And in my book, I argue, along with Karl Polanyi, that they’re so mad, they’re looking for strong men to protect them from these bad guys. And that strong man could be Donald Trump. You know, I was shocked, Donald Trump went to Davos and he talked to the bankers and he said, you’ve got to put a cap on interest rates on credit cards. Do you know, like that is so blindingly obviously a wrong and it takes a fascist to make the point really, but what he’s doing there is saying, don’t worry, I haven’t forgotten my base here. Like they selected me because they said they want, you know. Of course, I won’t touch Wall Street and I ain’t going to mess with Elon Musk, but every so often I’m going to throw a bone.

Nish Kumar Yeah. It’s such an interesting point. This thing about Trump occasionally just says something like you have to cap credit card debt at Davos, but he’s not doing anything to really endanger his real paymaster. We saw the inauguration, you saw who was sat in that room. After the break, is the Green New Deal, which Ann helped to create, dead in the water.

Coco Khan [AD].

Nish Kumar One of the other bubbles that you identify or potential major bubbles is the entire insurance industry. But that’s because the entire endurance industry is imperiled by the prospect of total climate breakdown. And the book really, one of the things that I thought was really great was how much it explained how Global Casino is responsible for the acceleration of climate breakdown, and is also imperiled by it, both of those threats will impact on ordinary people. In attempting to kind of avert this crisis, you’ve been one of the architects of a Green New Deal. So there’s a 2008 report that outlined a series of UK specific policy proposals to mitigate climate change. The Labour government was elected with a pledge that it would hardwire a Green New Deal into every level of government, but the £28 billion Green Plan has been shelved. Are these ideas dead in the water, Ann? And what would your message be to the Labour government on the implementation of a Green New Deal?

Ann Pettifor Well, there’s two things. On the insurance industry, I live in a little town called Saxmandum in Suffolk, and on the coast is another village called Thorpenes, and it’s literally being washed away by the storms this last few weeks. This is happening across the coast in England. This is because the seas are rising, and this is because temperatures are rising. And the scientists have been telling us that for a very long time. Now, the key thing about that. Is that people bought their houses at great expense because this is quite an exclusive little village really. It’s a sort of Islington by the sea place.

Nish Kumar I’ve been down there, Ann. It’s a nice place. It is a lovely bit of the world.

Ann Pettifor Properties for 1.2 million, nothing. Insurance companies aren’t going to go to the coastal properties that people have bought. And we saw that most vividly in Los Angeles. And the problem is that when the insurance industry withdraws, the mortgage companies have to withdraw because you can’t get a mortgage without insurance. And so this is a kind of disaster coming towards us which we don’t want to think about. And then we say, sorry, there’s nothing we can do about this. There’s nothing, we can’t do about the climate because you know what? Niche, there is no money in the bank. And this is what drives me utterly wild that our politicians go around saying there is money. And we all know that when the great financial crisis came, suddenly there was a lot of money. When COVID broke, suddenly there was a load of money who got it. The rich got that money basically. Mainly because they have the power to move their capital abroad. And the point is that our monetary system, and I tried to make this case in the book, is a great civilizational advance. It’s something that we invented to enable us to do what we can do. And we can’t do something about the climate, and we can make the money system work for us. But right now, the monetary system and the Bank of England work primarily for private capital markets, for the casino, and they don’t work for us, right? They work for creditors and not for debtors. They make sure that creditors get very high real rates of interest, and we debtors, and there’s far more of us than there are of the creditors, we gotta pay those very high usurious rates, as I call them. So, but we need a reorientation of these central banks to take into account the interests of the economy. And in particular of the people of Britain. And that kind of shouldn’t be hard to do. And the thing that bugs me is that the politicians sit there saying, there is no money and you know, it’s terribly sad. And they pretend to be powerless, right? They own the Bank of England, for God’s sake. We nationalized the Bank in England in 1945. It’s your bank. You tell your bank to do what you want doing. Now, there are limits, and of course you can’t be irresponsible, but the fact of the matter is it’s your bank. It’s not somebody else’s bank. It’s Not Elon Musk’s bank, it’s YOUR bank. And it should be working for your people.

Nish Kumar It was so much of what you said in terms of the solutions that exist from a kind of climate catastrophe perspective, and also this idea that… Donald Trump has been making hay by essentially talking the language of anti-elite politics whilst obviously doing the opposite in policy terms, but there’s a huge opportunity for progressive political parties here, isn’t there? There’s a HUGE opportunity and it’s not being taken though, is it? But it is there, right? What needs to be done actually exists within what we would recognize to be a leftist or progressive political philosophy, right.

Ann Pettifor What it takes is political courage, and it takes leadership. For me, the model is Roosevelt in 1933. In 1933, we’d had the global financial crisis, we had capital mobility, we had chaos, we had imbalances, we have the threat of war, we had the rise of Nazis, right? And he stood up and he said, I am going to break down the gold standard system. And the gold standards system was globalization pre-1945. He said, no, no. I’m not gonna have it anymore. And the economist all said, oh, you can’t possibly, blah. Let’s have a conference and restore the Goldstein. And he said, you could have a conference I’m gonna attend. And he then turned Wall Street, you know, it’s funny, his finance minister was called Morgenthau. He said we moved the government from Wall Street to my office in Washington. We need a politician who has the courage to say, I’m gonna move the government from the city of London to my office down in Whitehall. If we had that kind of political courage, we could then tackle all of these great crises.

Nish Kumar We’ve done it before and we can do it again.

Ann Pettifor We can do it again, sure. Sure as God, my little chickens. I don’t know why I said that.

Nish Kumar I’m going to start pitching a children’s TV show for you to teach children about economics and then at the end say, call them all my little chickens.

Ann Pettifor Oh dear.

Nish Kumar And thank you so much for joining us on Pod Save the UK at Ann’s book The Global Casino: How Wall Street Gambles with People and the Planet is available via Verso Books. It’s out now and it is absolutely fantastic. Now, before we go, we need to mark a hugely significant cultural moment, and it’s a moment so hugely significant, I just had to ask the producers how it was pronounced. Forget Barbenheimer, it’s time for Mamania. Yes, the Melania Trump documentary dropped in the US on the same day as the music mockumentary, The Moment, has been released. The Moment is a mockumentry about Charlie XCX, I guess making it the first and probably only time that. Melania Trump and Charlie XCX will be featured in the same sentence.

Coco Khan So the interest in seeing Barbie and Oppenheimer on the same day boosted both at the box office. But this crossover might be a bit less successful. So here is a taster.

Clip Everyone wants to know, so here it is. Hi Mr. President, congratulations. Did you watch it? I did not, yeah, I will see it on the news.

Nish Kumar I mean, it’s made me feel physically sick. It’s not done as badly as we would imagine. So, Melania was taking $7 million in the US on its opening weekend. Apparently it’s the biggest opening for a documentary in 10 years, as long as you leave out concert films. So, you know, it is not a great situation when you’re making a kind of claim for success that has to be immediately caveated. It’s taken just shy of £33,000 in the UK.

Coco Khan Just £33,000 is taken in these days.

Nish Kumar I mean, I’m annoyed that it’s taken 33,000 from what I can tell that 33, 000 pounds is exclusively from journalists going to see it and writing articles with the headline I watched the Melania documentary so you didn’t have to. You didn’t have to! Nobody had to watch this shit! It’s also really important to note that Amazon coughed up $40 million and offered the $35 million to promote it. Which makes it the highest price ever paid for a documentary film. Why is this happening, you might ask? Why is Jeff Bezos spending extravagant sums of money that there’s absolutely no way of recouping to make a documentary about the wife of Donald Trump? We can only speculate as to why Jeff Bezos may be going out of his way to ingratiate himself further with Donald Trump. You might ask the question, why is this film happening at all? And for answers to that, we might look to Brett Ratner, who is the director and who this week has emerged to be in a photo with Jeffrey Epstein as part of the Epstein File revelations. Ratner is a director who had previously been accused of sexual misconduct, who also directed the rush hour films.

Coco Khan Thank you for telling me how now Rush Hour is ruined for me. There is nothing, literally nothing that we can enjoy from internet humor to silly action movies that these fuckers won’t try and ruin.

Nish Kumar Before we go, Coco, listen, you know me, Mr. Rise and Grind. I wake up every morning and I immediately grind. The absolute high priest of hustle culture. Therefore, I’m sure it will be a huge surprise to you as it was to me and indeed my agents and promoters that last week I completely forgot to say on the podcast that I have announced a new UK and Ireland tour that’s happening in September, October and November of this year. The tickets are available right now. If the idea of what should we do sound up on stage appeals to you, uh, then buy tickets at nishkumar.co.uk.

Coco Khan I think you missed a crucial bit of information, which is the name of the tour. What is the name of the tour?

Nish Kumar The name of the tour is “Angry Humor From A Really Nice Guy.”

Coco Khan Okay, great. I feel like that should have got a mention.

Nish Kumar Rise and grind, diary of a CEO. Anyway, that’s it. Thanks for listening to Pod Save the UK. Don’t forget to follow at Pod Save UK on Instagram, TikTok, X and Blue Sky.

Coco Khan Pod Save the UK is a Reduced Listening production for Crooked Media.

Nish Kumar Thanks to lead producer May Robson and digital producer Leo Schick.

Coco Khan Our theme music is by Vasilis Fotopoulos.

Nish Kumar Our engineer is Dana Ruka and our social media producer is Nada Smilinic.

Coco Khan The executive producers are Kate Fitzsimons and Katie Long with additional support from Ari Schwartz.

Nish Kumar And remember to hit subscribe for new shows on Thursdays on Amazon, Spotify or Apple or wherever you get your podcasts.