 So next we're going to have Scott Tarot and Chris Leonard. And I'll let Chris introduce Scott. But first I want to introduce Chris. Chris is an author of a really excellent book called The Meat Racket, which came out last year. And it's about consolidation in the meat industry in the United States. It's a really scary book, but you should all read it. And he's working now on a book on the Koch brothers and how they actually make their money. But I'll turn it over to Chris. Yeah, thanks, Barry. Appreciate it. The Meat Racket's a fun read. Please, don't be intimidated by it. So thank you so much. It's really great to be here with Scott Tarot, not just because I love his books and have read them for a long time. But I think Scott can give us a really great, what I'd call maybe an author's eye view of what the book industry looks like today, how it's changed, particularly since the advent of Amazon. And what that means just more broadly, I mean, more than just folks making a living by publishing books, but what it means for our culture, our country, our society. Scott has published 11 books, 10 of them are bestsellers, which kind of makes me hate you a little bit. It's an incredible track record. They're really wonderful books. He's also an attorney, was a federal prosecutor, and a head of the author's guild. So you have sort of a view of the situation from all perspectives. And thank you so much for being here to talk about it. I guess what I'd like to ask you to start off is, presumed innocent, your first novel came out in 1987. And you've been in this business ever since then. I'd imagine you've seen some changes in the overall economy around books. What have you seen during your time? Actually, the first book I published was in 1977 while I was still a law student. And it was a book called 1L about my experiences as a law student. And at the time that 1L came out, the Harvard Bookstore and Harvard Square did this really amazing thing. And they discounted copies. I wasn't even sure it was legal, but it certainly was beneficial to me. And when you hear from people like Doug Preston and me, I always like to emphasize that we are not trying to make our own lives better, or easier, or richer. The fact of the matter is that most of the changes that have taken place in the literary world, whether it was book discounting or the emergence of the book chains, or then Amazon, are immensely beneficial to bestselling authors. Because bestselling authors get paid, especially when we're talking about physical books, on the basis of the retail cover price. And your royalty represents a part of that. And so the cheaper the bookseller makes the books, the more copies are going to be sold, the more the person lucky enough to refer to her or himself as a bestselling author. The more we make. The reality for me is that Amazon has been great for me. They've sold tens of thousands of copies of my books, probably hundreds of thousands of copies of my books. I don't object to their effect in the literary world for my own sake. I object to it because they are, as I have called them, the Darth Vader of the literary world. They have not been overall a force for good. Now you can't, you know, you paint with a broad brush and obviously there are ways in which Amazon has been helpful and certainly the fact that they have lowered book prices to the consumer, as far as the Justice Department, it's a good thing. The question is how did they get there and how did they do it and what is the damage that they're doing to the literary ecology? I don't think personally that you get very far in this country objecting to the outcomes that the free market produces. What's important to me about what Amazon has done is whether their conduct is really consistent with a free market. No one denies, no one, if somebody from the Department of Justice was here today, they would not deny that Amazon is a monopoly. And as Doug said, the idea that you would tolerate a monopoly in the marketplace for books is by itself controversial. Books and authors have a special place in this democracy which is enshrined in the Constitution in Article I, Section 8, which instructed the Congress to make laws to secure to authors for a limited time their copyrights. And the basis of the reason for that was that the founders had a view that the rich discussion that's supposed to take place in a democracy would be best promoted by having an independent authorial class, not beholden to the government, to universities, to private patrons, but supported by their readers. So if you say that books are literally a matter of constitutional stature and fundamental to the operation of the democracy, the idea of allowing any entity to develop a chokehold over that enterprise is by itself, it's very strange. But my, as a member of the author's guild board and president of the guild, we began to object to what Amazon was doing years ago when they started selling used books. At the same time, they were selling new books. The problem, of course, is that by selling the used books side by side with the new book, neither the author nor the publisher, who have an investment in that book are allowed to recoup it. And like a lot of things that Amazon has done, they were simply, yes, it was lawful, but the laws were never intended to promote that kind of a result. But for me, the place where I really got off the boat was with what Amazon did when they introduced the Kindle. And they began, they got publishers to agree that their e-books, their Kindle books could be released at the same time that hardcover books were by promising the publishers to pay them the same thing that they would earn on a hardcover book, all well and good until the publishers found out that Amazon was then gonna sell e-books at a loss, a loss of somewhere between $2 and $5 on every title. Now, in my view, I don't claim to be an antitrust expert, but that's where the Justice Department should have stepped in because by selling at a loss, Amazon was able to permanently, and as it turned out forever, distort the market for books in this country. They were driving the market toward the e-book at the cost of physical books. And they weren't doing it by honest competition, they were doing it by selling at a predatory price. By doing that, they foreclosed other competitors from entering the market because very few commercial entities in this society have the remarkable relationship that Amazon has had with Wall Street, which has been willing to prop up the company for 20 years now, even though they've barely earned a profit. And you have to say to yourself, why would they be doing this? And if anybody thinks that the people on Wall Street are not expecting monopoly profits out of Amazon sooner or later, then you really haven't been paying attention to what goes on in this country. Wall Street is not doing this because they've simply favor lower consumer prices. That is not, that's not what the motive is. So, but Amazon was allowed to sell at a loss resulting in the closure of thousands of physical bookstores in this country. One of the things that bothers me the most is if you look at the way books and especially e-books frequently get bought in this country, people will go into a physical store, they will pick up the books, at least if you're lucky enough to live in a place where physical stores exist, which in many middle-sized cities in this country, they're not there anymore. But they'll go in, they'll look at a physical book, and then they'll literally take out their cell phone and order the book most often from Amazon. Now, that state of affairs exists because bookstores were essentially foreclosed from ever entering this business because hard-pressed by what Amazon was doing to them in the sale of physical books, they could hardly turn around and lose $2 to $5 every time they sold an e-book. So they never got into the market. And this, the only significant player here for a long time was Barnes & Noble and they were hemorrhaging money trying to compete with Amazon because they don't have the same support. So what is the effect of all of this? The effect on all of this is the publishers, as Doug said, can publish fewer books and the margins are under threat. In the meantime, Amazon expands and becomes a publisher itself and it is clear, as one of the publishers said to me a couple of years ago, Amazon aims to clear the field of anyone who stands between Amazon and the reader. And when there is no one left, it is entirely predictable that the cost to the reader will go up. In the interval, the people that they are going to press and press hard will be authors. And to some extent, that started already. Yeah, and that's the oldest playbook for monopolies, right? They clear the field and then prices rise. It's happened again and again over history. And I think what readers don't often see is that process that happens behind the bookstore shelf of actually creating a book and bringing ideas to market. And I don't think any authors really get into this business thinking it's gonna make them rich but there was this sort of marketplace that supported writers to the degree they could eat and live in a crummy house and at least produce their books. You talked to a lot of authors. I was wondering if you could just describe for us what's happened to that marketplace most people don't see where new writers with new ideas are trying to get in advance that might support them for a short amount of time and the sort of place that produces new ideas and new books. Well, it's increasingly difficult to become published as a new author and especially as a new author who is not in one of the niches that continue to sell well. And I have a daughter who would possess by what madness I don't know has decided to become a writer and she did her MFA in New York City and I was talking to her about this and she said to me, oh dad, she said, none of my friends think they'll be able to make a living as a writer. Now, when I went to graduate school in creative writing 30 years before that, it turned out, of course, that many of my friends weren't able to make livings as writers either but they didn't know it going in. And the situation now is that any rational person looks at this landscape and says, unless I'm lucky enough to be a Doug Preston or Scott Tarour or probably two or three other, two or three hundred other authors in this country, you're not going to make a living doing that. What about this notion that Amazon itself will solve that problem, that you can self publish and that it removes this terrible gatekeeper function of these mean publishers in New York that were only stifling creativity and that Amazon is gonna be the pathway to self publishing? Well, first of all, I'm happy to see more books published. I'm happy to see independent publishing take place. There's nothing wrong with that. I don't decry it at all. But it is, it reminds me of the wars between the lower classes. Publishers are hard pressed by Amazon. They can't afford to publish new authors and new authors hate because they've worked hard and they've written good things and they can't get them published. And so they say, well, Amazon's great and the publishers are bad. Whereas in point of fact, the whole system that Amazon has created is what is punishing those new authors. And the notion that Amazon, when it takes control of this marketplace, operates in a benevolent way toward those so-called independent authors is also foolhardy. Amazon fixes prices for these independent books. If you want the 70% royalty that Amazon promises, then you have to price the book in accordance with Amazon's notions of where the book ought to be priced. You cannot sell for less than 2.99. You cannot sell for more than 9.99. Why the Justice Department does not think that this is an unacceptable practice is beyond me. Just, it's just beyond me. But independent authors have watched Amazon already begin to cannibalize their incomes with their subscription service, Kindle Unlimited which has these mysterious pooled earnings that Amazon alone decides at the beginning of the month and the independence who've been lucky enough to succeed have watched their earnings plummet. So, they really are kissing the dragon and of course not aware of it. And the one action we have seen by Department of Justice was against Apple and some of the publishers that were trying to stand up a competitor to Amazon in the iPad. And yes, you could argue they colluded because they talked to each other. But Amazon itself, as you're saying, is fixing prices, clearly selling at a loss to wipe out competitors. You know, you were a prosecutor in Chicago. Why do you think we're not seeing more action to keep this business competitive? Well, you know, there's a school of legal theory called the legal realists who said that basically all jurisprudence is fundamentally political. And if you want to see that notion writ large then you should look at what happens with antitrust doctrine. And you know, things like vertical integration which I was taught in law school when I took antitrust class was per se illegal has been embraced, that one the Republicans liked. Now we have a democratic administration that thinks that, you know, the low prices are a creature of godliness. So it will change. Antitrust doctrine changes more than any other facet of the law that I know of. The problem is that when that change occurs and when you talk to people in the Department of Justice they have all kinds of fantasies about how Facebook will end up selling books instead. It's all the King's horses. It's all the King's horses and all the King's men couldn't put Humpty together again. If you wipe out the book selling ecology that has existed in this country for more than a century then what's going to be left? When all of a sudden they say, oh Amazon they really are Darth Vader and they've gotta change their ways. And then the argument will be, well there's no other way to get books. You know, the last Barnes and Noble in Washington DC closed a few weeks ago which is so utterly depressing. I'm just gonna say it as a reader, not to be able to walk into a physical space and see those books. And so I think your point is dead on that we're losing an infrastructure that is not gonna be easy to replace at all. Do you please leave us with some glimmer of hope? I mean do you see any actions out there now that people are at least waking up to this or there might be some sort of cop on the beat that could help move this back in a direction of more competition and more pathways for ideas to get out there to readers? You know, if Frank Fore and I did a debate in an intelligence-squared debate and we were lucky enough to debate in New York and the question was is Amazon the reader's friend and we won in New York. I wouldn't have wanted to hold the debate in Seattle. But there is some awareness that this chokehold over the marketplace of American ideas cannot be good for all of us. And there will always be books, books will always be written. Some people will be able to make a living doing it. But the question is whether the constitutional vision is being fulfilled by what is going on with Amazon among other players. And my answer is absolutely not. And unless there's something coming over the horizon I don't see, it's gonna be a while before that changes. Well, I wish we could talk longer but we have to keep on schedule. So thank you so much for being here and all your hard work in this space. Really appreciate it. Thank you. Thank you.