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How Companies Use Bankruptcy to Avoid Liability | The Daily Show - YouTube
Channel: The Daily Show with Trevor Noah
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since 1886
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johnson johnson's name has been on
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everything
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baby oil
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shampoo and conditioner moisturizer
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duane the rock johnson
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but one of their most iconic products is
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talcum baby powder
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and while it might have kept our
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downstairs dry it also may have caused
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some very harmful side effects
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johnson johnson is facing thousands of
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lawsuits over allegations that some of
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its talk powder was contaminated with
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asbestos it's been a product mainstay
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for johnson johnson for decades now
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talcum baby powder is at the center of
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multiple investigations at issue has the
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company hidden evidence that its baby
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powder is linked to asbestos and ovarian
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cancer and women who use it around their
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genitals j j has long since denied the
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claim but now documents reveal the
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company knew about the presence of small
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amounts of asbestos in its products as
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far back as 1957.
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but did not disclose that to the public
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thousands of people have sued j and j
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some winning tens of millions of dollars
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in judgments johnson and johnson ordered
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to pay 55 million to a south dakota
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woman who blamed her ovarian cancer on
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the company's talcum powder a st louis
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jury awarded 62-year-old lois slump more
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than 110 million dollars a jury awarding
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a california woman
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417 million dollars one single verdict
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for 20 women exceeded 2 billion
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that's a lot of lawsuits
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i mean you know you up when your
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company is giving away more money than
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powerball
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and i get why it's happening because
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guys
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you cannot be selling baby powder with
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asbestos in it
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people are rubbing this stuff all over
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their bodies
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not to mention the cocaine dealers who
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mix it in with their product now you've
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got innocent coke heads snorting
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asbestos it's unacceptable
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now the experts over at johnson and
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johnson they they have found a cure but
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unfortunately it's not a cure for the
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cancer it's for the company's legal
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problems johnson johnson is filing for
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chapter 11 bankruptcy in hopes of what
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the company says of disposing of 40 000
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lawsuits in order to limit their
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liability as well as to shield their
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corporate assets johnson and johnson
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pulled something that's actually known
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as the texas legal loophole also known
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as the texas to step defense j j is this
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super rich health products company
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headquartered in new jersey so j j went
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to texas and using a quirk of that
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state's laws they created a completely
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new company called ltl
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then johnson and johnson dumped all the
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liability for these baby powder asbestos
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lawsuits you know tens of billions of
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dollars of legal risk into this new firm
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then the new company ltl quickly filed
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for bankruptcy critics say the company
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is abusing the legal system and have
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called the bankruptcy filing a gimmick
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yeah
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[Applause]
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the texas two-step i'll spend that jury
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round and round change your name and
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flee the town
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do i get a record deal
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this is insane people
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johnson johnson is pretty much trying to
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do the first thing everyone thinks of
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when they get caught
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blame it on their evil identical twin i
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mean we've all tried it the only
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difference is it somehow actually works
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if you're a powerful corporation
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honestly i'm i'm almost impressed
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i just wish they put as much effort into
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covert immunity as they did into their
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legal immunity but look as crazy as this
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is
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jnj is hardly a trailblazer when it
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comes to abusing bankruptcy laws to get
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out of trouble purdue pharma has filed
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for bankruptcy as the maker of oxycontin
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tries to protect itself from mounting
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lawsuits purdue pharma made billions off
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the painkiller oxycontin the bankruptcy
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filing is seen as a way to protect
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purdue pharma from nearly 3 000 lawsuits
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the boy scouts of america has filed for
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bankruptcy protection after an onslaught
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of lawsuits alleging rampant sexual
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abuse of children for decades they may
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claim that they don't have the ability
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to play these pay these claims but the
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real reality is that they use the
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bankruptcy
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to really continue to hide and shield
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themselves from real liability and
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forced disclosure the roman catholic
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church is one of the world's wealthiest
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institutions across the united states
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priest abuse victims now adults are
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lining up to sue their diocese for
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damages
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but the church is going to extraordinary
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links to protect its assets and that
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strategy is
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bankruptcy chapter 11 was not designed
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to protect
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organizations who've engaged in criminal
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conduct or basically protecting criminal
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conduct it was designed to give
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companies who made bad business
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decisions a new start
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yeah i'm sorry people purdue pharma is
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not bankrupt and the catholic church is
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definitely not bankrupt
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ain't no bishops rolling into pawn shops
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asking how much they can get for that
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michelangelo ceiling
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now the boy scouts
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are the ones where i'm like yeah you you
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might actually be broke
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i mean these guys are rubbing sticks
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together to start a fire my man a 12
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pack of big lighters is like three bucks
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get your life together but for real we
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know it's all right and
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shielding super-rich institutions from
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punishment isn't what bankruptcy
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protections are supposed to be about
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unfortunately there's a movement in
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congress to end some of these abuses of
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bankruptcy laws and here to talk about
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it is california congresswoman katie
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porter representative porter welcome to
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the daily show
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thank you so much let's jump straight
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into the issue at hand i i didn't know
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this before i was reading up on this
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issue but you taught bankruptcy law for
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years before joining congress and now
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once again bankruptcy is in the
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conversation with johnson and johnson
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them wanting to split off their baby
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powder company as a separate entity so
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that johnson and johnson as a whole
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can't be held liable for what happened
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to so many people out there
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from a bankruptcy expert's point of view
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or somebody who studied it and taught it
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what do you think we're missing in these
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conversations when we allow companies to
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declare bankruptcy to avoid some sort of
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i guess accountability
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i think this is fundamentally a problem
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about preventing corporate abuse
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and bankruptcy is really the tool that
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these corporations are using to avoid
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liability for the damage and harms that
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they caused in this case many many many
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women getting devastating and deadly
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cancers from using baby powder laced
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with asbestos um but fundamentally this
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isn't really a bankruptcy problem it's a
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larger problem about how do we make sure
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that companies that make money are also
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on the hook for paying for the harm that
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they cause along the way and that's a
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problem we see in environmental issues
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with offshore drilling for example and
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oil leaks it's a problem that we see
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with product liability um and so this is
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one more example but the bankruptcy
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issue here does i think tend to be a
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place where corporations have been very
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successful at getting off the hook
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yeah why does it seem that individuals
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are held to a different standards of
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corporations and that if i do something
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to you i would be forced to pay for that
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or i would be forced to make amends for
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what i'd done but if i as a corporation
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did something to you i can somehow get
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off the hook we saw that with the
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sackler family with the opioid crisis
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you know millions of americans are
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either dead or have you know addicted to
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drugs because of this opioid crisis and
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i think the key thing that is similar to
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the johnson johnson is that they knew we
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find out time and time again that the
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companies knew what they were doing was
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harming people it wasn't a mistake and
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then not only did they not say anything
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but oftentimes they pushed their
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products even more like
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is there any shift amongst yourself and
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your colleagues in holding these
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companies accountable
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absolutely so we're working on
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legislation that would limit companies
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abilities to do this so it's important
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to remember the entire idea of a
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corporation
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is to in fact protect the owners from
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being fully liable for things that go
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wrong and the idea is if we were all on
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the hook for everything we did wrong we
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would not take risks we would not invent
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new products we would not develop new
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things so that principle is good but it
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has to have bounds and limits and what
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we're seeing with the stockholders what
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we're seeing with johnson and johnson is
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companies use very basically exploit a
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combination of state and federal law to
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get off the hook the whole point of
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bankruptcy is to help companies or
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people who cannot pay
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jonathan and johnson can pay this is a
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company with 440
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billion dollars it is perfectly capable
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of paying for the harms it caused one of
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the the more disturbing um facts from
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the story is the fact that johnson and
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johnson specifically targeted black
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women to use the products even though
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they knew that they were harmful and
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they knew that i think sixty percent of
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the of their customer base of that talk
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powder was specifically black women
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it it's it i think it definitely would
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erode the trust that people have in
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these in these companies it erodes their
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trust in whether or not they can be held
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accountable and there's there's no
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denying i mean even now with vaccines a
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lot of people in the black community are
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saying we don't trust any of these
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pharmaceutical companies we don't trust
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america's medicine and its history with
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us as black people and now there's
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there's going to be some people who say
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well then why should i get a johnson
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johnson vaccine how can i trust that
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are you prepared for you know what this
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means to have have you thought about
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how the fallout of johnson johnson could
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affect i think a larger health messaging
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i think that's a really interesting
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point i do want to observe one really
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important difference about vaccines
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exactly because
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we have in our country let bad actors
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who have put products into the work into
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the product stream that have hurt people
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get off the hook we've taken a different
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approach for vaccines so anyone who
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believes that they were harmed by a
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vaccine doesn't have to look to the
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manufacturer you can go directly to a
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vaccine fund that already exists because
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we're not going to make people we want
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people to take vaccines and we want to
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reassure them that there will be damages
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there'll be help if they're if they
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think they're harmed there's a place to
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report that and to get the help that
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they deserve and the justice that they
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may need and so we've actually i think
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on vaccines corrected this injustice the
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problem is we haven't done it for all
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these other products including as you
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mentioned opioids including johnson and
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johnson and the baby powder and other
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kinds of dangerous products in the in
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the in the marketplace and this is true
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by the way for things like safety seats
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um baby seats and car seats another
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issue i've worked on tainted baby food
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baby formula this is a chronic problem
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where companies put things into the
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marketplace they know they're dangerous
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and then they use corporate law to try
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to deny justice to those that they hurt
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before i let you go i would be remiss if
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i did not talk to you about what the
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whole country is waiting to see um a
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move on and that is the build back
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better plan
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many people are frustrated
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understandably at the fact that they
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voted for democrats the democrats are
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now in power they want to see something
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happen they want to see a change in in
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their health care you know whether it's
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the dental and vision they want they
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want to see a change in in college and
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and the price that people pay they want
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to see changes in the things that
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democrats promised them they they'd see
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changes in and yet now it feels like not
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only is nothing happening but the
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promised list is slowly being whittled
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down to a very small group of things i
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mean the last i saw it you know now the
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richest people would be getting tax cuts
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what is your message to the american
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public and what is your message to your
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colleagues who who may be holding up the
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system as you see the results i mean in
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virginia speaking for themselves
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we are definitely as close as we have
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ever been to moving this bill i just
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heard my colleagues i was in a meeting
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and we were all like let's go vote on it
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right now i think we are ready to do it
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and i i want to say there are there are
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times in this process where we've tried
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to get things done and we haven't gotten
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all of them but i have to be honest i
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never thought as a working mom as a
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single parent in this country that i
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would ever see my government understand
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how hard it is to afford child care
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would ever understand how important it
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is to give
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little kids preschoolers toddlers that
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early childhood education they need i
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never thought we would finally stand up
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to big oil companies and fossil fuel
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companies and protect our planet and we
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are actually going to do those things in
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this bill and i will tell you everybody
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understands that this bill is the
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beginning of delivering on the
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president's promises it is not the end
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and so i feel very very good that we are
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going to pass these programs they are
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going to improve people's lives so we
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have to keep on delivering for for
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americans and we appreciate their
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patience as we get this done well
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representative porter thank you so much
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for taking the time and hopefully we'll
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see you back on the show again soon
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thanks so much
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[Music]
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you
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