James B. Stewart has a message and it’s the same one you’ve heard your mom tell you a million times: Don’t lie. Your mother, however, never wrote a 444-page tome in defense of her admonition. In Tangled Webs: How False Statements Are Undermining America: From Martha Stewart to Bernie Madoff, former Wall Street Journal editor, Pulitzer Prize winner and soon-to-be New York Times columnist Stewart—aside from pulling off the rare double-subtitle—recounts in scrupulous detail the cases of four of the past decade’s most high-profile liars. The book lays out the ramifications of false statements proffered by media mogul Martha Stewart, vice-presidential aide Scooter Libby, baseball slugger Barry Bonds, and Ponzi artist Bernie Madoff.

James B. Stewart
Courtesy Photo

The Indy tracked James Stewart down at the Ritz Carlton in Atlanta where he is in the midst of a nationwide book tour that will bring him to UCSB’s Campbell Hall on Wednesday, May 25.

First off, can you give us a preview of the talk you’ll be giving at UCSB next week?

My approach as a writer is to try to tell true stories in novelistic detail so that readers can draw their own conclusions and make up their own minds. In the speech, I’m going to be a little more explicit about the conclusions I draw and the insights I’ve developed over quite a few years of delving into this subject.

One of the things I do in the talk is try to synthesize the information. Any of the stories in the book could have been a book in and of itself. The power of the stories really is cumulative. I did tell them in a certain order for a reason. I think it’s only once you absorb the elements of all four of those stories that you see the full scope of the problem with false statements in this country, and the consequences that is having.

Did you order them from the least grave to the most serious?

First of all they are in chronological order; it just worked out that way. I wouldn’t necessarily want to say the least serious to the most serious. They illustrate different dimensions. False statements are like a pebble being dropped into a pond. You see the ripple effects spread out. In each of these cases you see a further widening of the ripple.

In Martha Stewart you really see the effect on investors and shareholders and employees in the company where she was chief executive. In Libby you see the consequences for a democracy that depends on truth for voters to make informed decisions. In Barry Bonds you see the impact on the judicial system. And then in Bernie Madoff you see something somewhat different which is the failure to prosecute perjury, the failure to take it seriously, and the consequence that had for investors. So that’s kind of how it is structured.

In one sense your book is a cautionary tale.

I hope so. [Laughs.] If not then I’ve completely failed.

Especially in the conclusion you make some moralistic proclamations about lying. In another sense it is kind of hard to say when lying is appropriate or not. In the instance of Douglas Faneuil [the broker’s assistant who passed on the tip to Martha Stewart that would lead to charges of insider trading] the prosecutors were pressing him to shade the truth when he testified in court.

Isn’t that interesting. You are one of the few people who read the book who have picked up on that theme. No one is immune. No walk of life is immune from the temptations of making false statements or trying to induce others to do so for their own purposes. I think Doug was very disillusioned. Here he finally came forward to tell the truth and in order to tell a convenient story they wanted him to embroider or at least fudge some of the elements of it or at least not dwell on certain parts of the story. To his credit he stood up to them. The great irony is he had to plead guilty to a crime he didn’t even commit.

I thought that story really illustrated the title of your book, Tangled Webs. The metaphor of rippling is prevalent also, but I think in some sense they are contradictory.

You’re right, I’m mixing metaphors. But a web also has concentric structure. The classic web has a spider at the center but then there are fibers that get further and further away from the spider at the center. You see in these stories that people get affected at an ever-growing distance from the person who actually commits the major lie in question.

With Faneuil it worked out, more or less, but he could have made his situation worse by telling the truth, depending on other peoples’ testimony.

I don’t know. He paid a pretty high price for his honesty. What he has is his personal integrity. He can live with himself. He has a conscience. I don’t know how many people in this book do. Not only did they lie and not only were they found guilty of lying, they kept lying.

In the case of Bernie Madoff, you called him a bad liar. The investigators also told you that he wasn’t a good liar. I know your message is that we shouldn’t give false statement, but I was curious if, in writing the book, you learned what makes a good liar.

Good question. I don’t want to disseminate that information but I do have a few reflections on that. I don’t know that it is anything particularly profound but I think that the good liars stick as close to the truth as they possibly can and they only deviate from the truth when necessary. Scooter Libby was a terrible liar. He didn’t just say “I can’t remember” or “I don’t know” or “I was so busy.” He cooked up this whole phony story about how he couldn’t have leaked [CIA agent] Valerie Plame’s name because he didn’t even know it until he heard it from Tim Russert, the NBC bureau chief in Washington. [Libby was accused of blowing Plame’s cover as retaliation for her husband—and UCSB alum—Joseph Wilson’s discounting, in a New York Times op-ed, President George W. Bush’s claim that Saddam Hussein had sought radioactive material from Niger.]

The problem with that is in two elements of his story. One, that he had a conversation with Tim Russert. So the minute anyone asked Tim Russert, Russert said, “No, I never told him the name. In fact, I didn’t know the name so I couldn’t have told him.”

Number two, it also depended on him not knowing the identity of Valerie Plame until he spoke to Tim Russert. They had something like eight witnesses in the White House and they also had Libby’s own notes—in which the vice president told him Plame’s name—that disproved that statement. He’d been told her identity on multiple occasions before he had this conversation with Tim Russert where apparently the name never came up.

It’s always struck me as an unbelievably bad lie, in part because he decided to make up a whole false story instead of sticking with what actually did happen and then deviating when only necessary. In other words he could have said, “Yes, I knew about her from the vice president. I knew about her from sources X,Y, and Z, but I never disclosed her name to a reporter.” At least then the only people who could contradict him would be a reporter, but assume the reporter had a confidential relationship and didn’t want to talk. That’s one lesson.

The other thing about even a good lie is that even you know it’s a lie, unless you are just a complete psychopath. Look at Doug Faneuil. His life was miserable, he couldn’t live with himself. I don’t know if I could under those circumstances. I would hope not.

Were you surprised that some of the subjects of your research were such poor liars?

Yes. They were all very well-educated, successful people and the stakes were very high. Madoff, in particular. I figured he must have been a genius because he kept his Ponzi scheme going for 20 years and he survived four SEC [Securities and Exchange Commission] investigations. Not one. Four! So I was totally shocked to discover how bad his lies were.

In the Madoff section, the liars and the people giving false statements aren’t the only villains. There’s also a system that is not great at detecting and punishing liars.

And the people who obviously don’t seem to care that he is lying. That’s what I found most shocking about it. This is law enforcement itself and the investigator is saying, “This guy is lying.” They were perfectly blunt about it and explicit about it, but law enforcement didn’t want to do anything. The inspector general of the SEC told me—I’m amazed people haven’t made more out of this in the media. He said to me that the SEC to his knowledge had never referred a perjury case to the Justice Department.

In other words, they’d gotten so used to it that they’d just kind of swallow it. I’m getting worked up even now when I talk about it. I think that’s appalling. If law enforcement doesn’t care then who else is going to? So we’ve lost the war.

Do you have any conjectures about how to solve what you call the “epidemic” of false statements or perjury? It seems like people are always going to lie—

People are going to lie but are they going to lie under oath? Are they going to lie repeatedly under oath? I would like to think not. That’s why when they do they have to be prosecuted. But if everybody is lying, all you are going to end up with is perjury prosecutions, and we don’t have the resources to prosecute all that perjury. It’s definitely the kind of crime that, if the attitude becomes credible that “everybody is doing it,” then, again, the war is lost.

I think things can be done. I think it has to start with law enforcement at the top. I’d like to see the President make it a priority and say, “Look, with our elected officials, we are going to acknowledge it as a serious crime.”

In our everyday lives there are a lot of people who have said, “I’d never lie under oath,” then they got caught up with people who do, and they ended up enabling it or tolerating it or sweeping it under the rug.

That’s something we all have to guard against. We certainly have to set an example for young people and teach our children.

Parents tell their children not to lie all the time. When did it occur to you that maybe we need a book about this?

I was giving a speech about the corporate scandals a decade ago—Worldcom, Enron, Adelphia, Tyco. There was an amazing sequence of corporate fraud. I thought, “What’s the common element here?” because certainly there is no common cast of characters. And it dawned on me that false statements were at the heart of every one of those scandals and that the results were terrible. Investors lost billions. Employees had their life savings tied up in company stock; they got wiped out. Terrible consequences.

And the people who were making the false statements were CEOs, CFOs, successful, wealthy, well-educated people, business leaders, role models in their community. I thought, “Wow, this is a really ominous trend.” Then I started seeing it in other walks of life as well and I realized this isn’t confined just to the business world.

It is in my nature that it’s the detail that reveals all, so I ended up choosing these four stories to delve into in great detail.

And your research was meticulous. How long did it take you to put the book together?

I worked on it for about four years and I did take a break to write a long New Yorker story about the financial crisis. Even then I was still doing some work on it. It was very labor-intensive. I could have written four books with all the material I gathered. But you have to get to the bottom of what happened.

I was always interested in a fundamental mystery as I started out: Were they really guilty? I tried to approach each one with an open mind. Maybe they were really innocent, as some of them still maintain. It didn’t take long to figure out that they were guilty. But then why would they have done it? Why would people like this risk so much? What could you glean from these characters that maybe illuminates broader issues in society?

Personally I enjoyed the first section the most, I think partially because it was told from the point of view of this almost tertiary character who gets caught up in the middle of everything.

He hadn’t talked to the press at all so the only press he got was people calling him a traitor and a Judas. He got terrible press, but he did talk. I did interview him many times and he was so honest and open, and willing to go into very personal detail. As a writer, you dream of finding people like that. I think you are right. That helped make that a very compelling story, because there he was, the pivotal character, facing a moral quandary. It was wonderful to be able to tell his story and I hope it helps him.

You draw a moral equivalence between President Clinton lying under oath and George W. Bush covering for Scooter Libby. I was wondering if anyone had taken you to task for that comparison?

In call-in interview shows, some people have wanted to resurrect the whole Clinton issue again and say, “It’s different.” They are different stories. The Bush story I tell in much greater detail. I didn’t want to revisit the Clinton story. I wasn’t trying to say there was a moral equivalence. I was just wanted to simply say, look, the President of the United States lied under oath. His successor commuted an aide’s [Libby’s] sentence, essentially saying, ‘Loyalty counts more than truth here.’ I think in both cases it sends a terrible message to the rest of the country. The President of the United States is the highest law enforcement officer in the country and is a role model for many people. If presidents are acting like perjury doesn’t matter that’s a terrible blow to the cause of truth and honesty.


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