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tv   After Words  CSPAN  July 5, 2014 12:00am-1:01am EDT

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site would do no such thing and no one has ever suggested it would. there's an argument to be made for war with iran. that argument involves doing whatever it takes to get rid of the current regime and bring about a -- one that is friendlier. there's an argument to be made for such war. there's also an argument to be made for saying, okay, iran, what is it that you really want from us, and what are you willing to give in return? there's an argument for that. we're doing neither of these things. it may be possible to resolve whatever differences we have with iran on the basis of, course number two, that has not been -- that has not been tried.
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may or may not be possible. and it is certainly possible to base our attempt to have peace with the iranian people on the basis of war against its regime, but that thought process has not been entered into. that is the kind of thing i'm talking about. >> this is an extraordinarily thoughtful exploration of some very difficult -- some 0 the basic questions of our time of war and peace by a very thoughtful expert and analyst. this is his book, "to make and keep peace." available outside. i believe for $20. and so we encourage you -- all of you to buy at least one copy, if not two. and then i know that angelo would be happy to sign it for you. i think we'll be doing the signing outside. so, ladies and gentlemen, please
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join me in thanking angelo codevilla. [applause] [inaudible conversations]
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up next, afterwards with guest host of the washington bureau chief of the sunday indianapolis. this week, kwasi kwarteng, "war is gold" the relationship of money to war and the interconnection between present-day free markets worldwide. the program is about an hour. >> welcome to after words. i'm tony heinz, and with me today issaquah si kwarteng, a conservative mp, born in londonk
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and try to understand something about the global financial system something about the current cease that we have the dollar sterling and the nature of gold as well. one of the features of this book
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is to remind people that for 400 years for 450 years we had a gold backed currency and it was in 1971 when richard nixon famously went off gold. >> host: one of the things i love about this is you have a knife or the dramatic moment and it's about you know the dry subjects such as money. tell me about the moment. >> guest: the key moments in any historical narrative of the key moments when people step back and say oh my.this is what's happening. it was august the 15th i think on a sunday. richard nixon essentially appeared on national television halfway through bonanza which was a great cowboy show, not really my time but maybe viewers will remember the show and he interrupted the show to say we are not going to allow the dollar to be converted into gold anymore. this in many ways was one of the
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most significant events, the most significant things have happened in the history of money. it was a very decisive moment where essentially he shot the gold. that is what the term was, where people could not simply come into fort knox metaphorically and say here is $100 or want to get the gold value and that was as a seqhe bad they were trying to fight the vietnam war and pay for the great society and it just didn't work out. there was def a deficit, trade deficit, and people like the french and bad people like the brits were coming to change dollars into gold, and so richard nixon decided to stop that. interestingly enough the federal chairman at the time, the head of the federal reserve, arthur byrnes, was very skeptical about that. an old-school balanced budget conservative guy and was wear wary of decoupling the gold from the dollar. >> host: another moment, lord
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george i?ç6 1914. >> guest: the great thing about british public finance for the 100 years before the first world war, before 1914, they ran balanced budgets. it's difficult to imagine that now. the whole victorian era and the 19th centuzy and top hates -- >> host: stable interest rates. >> guest: very stable, and stable fiscal policy, and what happened in the first world war is that all of that went to pieces in order to defeat the kaiser, to defeat germany, the british parliament was having massive spending and he said this is massive, and -- but they borrow huge amounts. the national debt went up ten times, more than ten times. say for 700 million sterling to over 11 billion. and the house of commons put it
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through because they would do whatever it took defeat germany. that was the attitude. >> host: and the title is this push-pull effect of war -- >> guest: absolutely right. >> host: -- and money, and you contemplated calling the book "order and chaos." >> guest: that's right. order is the gold standard or the commodity standard where you can see this is how much my dollar or my pounding worth and it's linked to some sort of external value or commodity. chaos, and one over the argument is put forward in the book, near a period of chaos where you don't have any kind of mooring to commodities. you happen fiat money, paper money, and you can just keep printing money and there was a strand of opinions in this country, probably more than any other, saying that was mistake and we should get back to the gold standard. it's associated with people like
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ron paul. this isn't a -- i'm not trying to write a really good narrative to explain how we got where we are but i think there is some false in the argument we need something more structured than just the ability of governments to print money. >> host: the quotes from ron paul, in 1981, thekev ten-year experimentç with -- >> guest: that's right. >> host: that is an argument very, very resonant here. big calling for ron paul in 2012. in some sense is probably going to run for president in 2016. do you think we should? could we? >> guest: a different factor in terms of how we could. i'll talk about that initially. the only way to get back to the gold standard is for the chinese essentially to decide, unilaterally -- they could re-institute the gold standard tomorrow, and say one is going to equal x amount of gold and they have enough reserves to back that. the only problem for them is
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they run an export model. if they did that the one would become a very strong currency which would be complete reverse of their export-led, keeping the value of the one low so their exports are cheap, and when we combine them. that would be a complete reversal, but in terms of actually introducing a gold standard, they can do it because they have the reserves. one point about the gold standard is if you look at the 19th century, it was britain who largely sort of guaranteed it. britain was running great exports -- the manufacturer of the world, british goods were flooding essentially global markets, not the least in america, south america, and the reserves that britain acquired through the expert trade meant they could keep a gold standard. the british themselves, we never really had that much gold, but everyone sort of relied on the stability and the export strength of britain. similarly in the 20th century,
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the united states ran current account sub days. unbelievable to think another that but until 1970, from 1900 to 1970, the u.s. was exporting more than it was importing, so it was building up reserves, building up gold and other foreign currency, and they really -- the united states guaranteed the gold standard after the first world war and the whole settlement was based on this value of the dollar at $35 an ounce. relationship. and that lasted from 1944 to 1971. >> host: sounds like you don't anticipate the chinese doing this. >> guest: given where they've come from in the last 25 years, they've deliberately forced their currency to be much lower, and i outline that in the book in 1980, the one was one and a
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half, one, two a dollar, and then over 20 years, it went down as low as eight and a half. and now it's sort of six and a half, that sort of thing. they deliberately had a very cheap money or, rather, low -- they were low value for their currency so they could drive exports. so, you're right to suggest if they went to gold, that would be a complete reversal of what they've been doing, how they've been building their economy, through this export growth. >> guest: you argue return to gold standard is impractical. >> guest: it is impractical but the current system is very vulnerable. and in a way explains what happened in 2008. and i talk about that quite fully. i mention the fact that many economists predicted that this would happen when you have a system where you just have a fiat currency, banks just pushing enter and printing money, you're going to get a very vulnerable and unstable
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system, and i think that's something that we have to consider. >> host: what about the effect of war on 2008, obviously 9/11, stenyears earlier. your argument is it wasn't just about 9/11 and nor -- more spending. >> guest: it was wasn't that complicated but if you remember -- i was on the trading floor in 2001 -- >> host: j.p. morgan. >> guest: that's right that's a swear word in this country. bus,ey, is was a banker, and the first thing that happened is obviously the 100r index went down 10%. the dow jones went down i think an appreciable amount, and what the response of the central bank was to lower interest rates. interest rates have been coming down all through that year, from 6-1/2. they went down to one percent and this is really cheap money. my argument is if you followed consequence of lowering the interest rate to such a low degree, what happened
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was that people wanted yield, a search for yield. they feel getting treasury at 2%, ten-year money at 2%, and some banker in the midwest, you're thinking, i need to get more than 2%. >> host: not pushing the margin >> guest: that's right. i can only get 2% of ten, year money buying treasuries. i have to get some interest rates, a search for yield and that was a phrase used commonly at the time, and the search for yield drove a lot of the subprime lending, a lot of the very poor credit decisions in terms of expanding credit in terms of giving people huge loans which they could never afford to pay. and that was what caused this kind of instability. and actually this is where the long view is very interesting because i found exactly the same thing happened in england in the 1820s. >> host: the bubble. >> guest: no, it was south american so what happened was that the -- after 1815, and the
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defeat of napoleon, sharpe's rifle is a popular tv show in britain but after that they went back to gold, and as a consequence of that the government spending went down, it was very low interest rate environment, and there was again this search for yield. they were saying, if we buy uk government debt, we're only going to get small interest rate from that. so let's look for something which is going to give us more interest rate, and there was this search for yield, which ended up crazy bolivian government, crazy stocks, all that kind of thing, and they blew up. >> host: if we can't go book to gold now, how do we moor the currency, stabilize it and stop another bubble? i. >> guest: the main thing that is missing from this is -- this is what people in the markets feel and i think people generally feel, is that there should be more leadership, more
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international coordination; if you look at brendanwoods, lasted two weeks. two years of preparation before thatout you had delegates from 50 countries, came to a9it resot in new hampshire and decided what the international architecture would be and that was a very responsible and very effective -- lasted from '44 to '71. in this current crisis we have not been able to reach the level of international cooperation. there's been a sort of lack of leadership, perhaps, people are slightly feeling less confident, and there's less of an idea of what can be done. and i think that was -- that has come about in the last four or five years. people see that. and one of the thinged about that is that in way i think it's come at a time in the 2008 crisis came at a time when global readership -- the u.s. is feeling perhaps less sure of itself, the u.s. itself is
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running huge deficits -- >> host: we should talk about that. >> guest: we can talk about later, and the u.s. has been slightly burnt by perhaps overextension in foreign affairs, foreign commitments. so, the capacity of the u.s. to provide that kind of global leadership is much lower now than perhaps was the case in '44, where all the post war period. >> host: you are not a bash the banker -- >> guest: not at all. i'm always very robust defender of the free enterprise system, a very robust defender of finance. if you look at my home town, london, it's the center of international finance for 300 years. arguably today. and apologies to new york. it is still the leading international center in terms of the number of international banks, the time zone, and the idea that british politicians should bash bankers and try and close down the city of london is insane. that's been a great strength of the british economy. that's what always argue, and i
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thick it's bourne out by the historical record. >> host: in terms of that, fascinating chapter on thatcher and reagan. >> guest: sure. >> host: that what went out the window was balanced budgets. >> guest: that's right. >> host: and it was -- became almost -- not your word but mind -- a fettish, an end in themselves, and i think to>ml as lesser extent, thatcher, and certainly reagan, talked about fiscal responsibility but in the end -- >> guest: reagan was a great fifth. unparalleled gift of communication. he could boil things down simply so people could relate to them. his idea can, he was very much -- his great metaphor about government spending was alcoholism. and his father had been al alcoholic. if you look at his speeches from the early '80s, he talk's this
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massive binge, a terrible hangover, we need to sort ourselves out, that was the metaphors he used. if you look at his record, because of defense spending and the cold war there was this deficit, and that was a time i think when people on the conservative side of the argument here, in america, were very focused on tax cuts, regardless of expenditure. my argument is that right through, really to the '60s, the u.s. conservatives were balanced budget people. so what they did if you look at the korean war and that was truman and a democratic president and eisenhower continued it -- they weren't reluctant to raise expenditures to raise -- raise taxes to race income to cover expenditure. so, i think in in the korean war, the president went to congress, they raised taxes and paid for that because they wanted to balance the budget.
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that was a old-school conservative approach and both eisenhower and truman stuck to that. it was only really in the '60s you started bending endless deficits and my argument is the conservative movement in america started by -- wanted tax cuts ball they said it would increase revenue but didn't really focus on the expenditure side, and i thick if you're going to reduce taxes you have to try to reduce expenditure. it's no good reducing taxes hoping to get more money from that while keeping intend -- expenditures rise examination this, supply supply-side argue; jack kemp, and arthur laugh her, focused on tax cuts, but in order to balance the budget you have to address expenditures. you can't just balance a budget on tax cuts alone. anduyñ even though i'm -- in an ideal world i would reduce taxes and reduce expenditures. the two go to together.
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>> host: george w. bush, described as fiscally incompetent. >> guest: that wasn't my word. bush is an extraordinary president in a way. attacked from the left and the right, because of his fiscal incompetence, so if you look at that period from 2001, the u.s. started running deficits aggressively, and those deficits were compounded by the foreign affairs can the foreign wars the bush government went into, and i think people on the left and the right, certainly on the right, were saying, you know, what's happened to this? we're supposed to be the balanced budget guy. we're posed to he hawks on public expenditure, to reduce the federal government, and its impact in terms of spending. but the spending went out of control, and it wasn't me. it was a lot of the guys from the think tanks, the heritage foundation, the kate -- cato institute, before criticizing
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bush for spending too much money. >> host: that led to the tea party movement. >> guest: that's right. the tea party was a legitimate protest. at this endless cycle of deficit expenditure, and federal debt was going through the roof, the deficit was going through the roof, and you forget -- people forget that in america, the budget was bowed in my country in britain as well, the budget would was balanced. in the 1980s they said the 30-year bond would be abolished because the government wasn't borrowing anymore more so in 50 years we have gone through a completely reversal of that position, and i think, in my book, i argue the bush administration had a part to play in that. >> host: how do you view the clinton era. >> guest: who knows about nat 2016 but the clinton was -- just look at the numbers.
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if you just look at where the budget was. it was quite a responsible time in the sense that public exp%q8v)uu)e didn't -- rose a little bit but not as fast as subsequently. actually refer knews were because of the booming economy were increasing, and the budget was largely balanced. a lot of his opponents say a lot of the problems were deep-seated, that he didn't address in terms of entitlements and social security and that sort of thing, but year on year, the budget was very balanced, and i quote greenspan when he came to congress in 2001, and if you read what he was saying, it's extraordinary. he was saying we're going to abolish the national debt. that was the environment in 2001. very much the view, this is pre9/11 -- that somehow we'd discovered perpetual motion, the u.s. economy was growing at three to four percent every year, and public expenditure wasn't going up very fast --
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>> host: very, very optimistic estimates? which were not shared by everybody. the fact that the chairman of the federal reserve could come to congress and speak as you mentioned of the glide path to zero debt in 2001, before 9/11, is extraordinary. given where we are now. it is extraordinary that 15 years ago people actually thought, credibly thought, that they would have a bowlished the federal debt by 2014. >> host: what is your view of alan greenspan. >> guest: i think he was a great -- i think the most important thing about him -- i'm a historian so i look at what people do, their personalities, because i think that's very important. and one of the most interesting things about him was he loved jazz music. a jazz player, coronet player or saxophone in the '40s, and would suggest he took very much a jazz player's approach for
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managing the economy. a very improvised. i quote people who worked with him, he said the plan was there was no plan. he was very, very savvy about what he felt himself being very savvy about markets, responded very quickly who what the markets were doing, and the mores important thing about him in terms of his career, in his tenure as the chairman of thebwx federal reserve, he essentially in his own mind saved the western world because of the crash of '87. a big wall street crash -- >> host: which prompted self-confidence. >> guest: that's right. very, very cheap money. lowered interest rates, pump of pumped huge amounts of liquidity in the system and averted disaster. and once you could that early on in your career and you play those again. if you're successful doing one policy very early on, the temptation is to keep repeating
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it, which is what he did. and now i would argue by 2002, 2003, very, very cheap money policy stored up its own -- stirred up problems, low interest rates the search for yield, and then people investing in very high-risk, high-risk product to get the yield and that created the instability. >> host: you describe an obsessive interventionist. >> guest: yes, very much the style. i think greenspan set the ball rolling in '87, and oning there you have to remember about these people running the federal reserve, they're obsessed with 1929. and the one lesson they learned from 1929 is that -- >> host: bernanke -- >> guest: yes, and they're obsessed with the idea that in '29 the federal reserve can the authorities didn't do enough, and they contracted the money supply at the wrong time and all the rest.
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so this endless luke witnessity, pumping liquidity into the system was their response from what they learned. >> host: you think it was the right response? >> guest: i think to do it willy-nilly as they did was perhaps slight slightly risky. i think they perhaps overlearned, perhaps learned some of the wrong lessons from '29, and what people -- in '29, they made it worse by shrinking the money supply. they didn't need too do that. bus the bailouts and huge amounts of money that people can't comprehend created a potentially own instability, and alsorct alienated a vast sectiof middle america. the tea party revolt was very much initiated or given fuel by this -- these endless bailouts and endless printing of money and endless spending and that's what people got cross about, and
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we're still seeing the ramifications of that now. >> host: you talked about rhetorically in the reagan-thatcher era about the household budget and putting things in a very simple -- kind of talked -- from the balanced budget. now we have this sort of system where you have a currency that is untethered, and these huge -- as you say, like, you have -- trillions, have to google to begin to comprehend. >> guest: that's right. >> host: how the average american -- i think how do we get back to what people can understand. >> guest: what people are looking at, you have to balance a budget at some point. in the uk in my country, the
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argument isn't about whether we balance the budget, how quickly we get to balanced, because endless deficits simply isn't sustainable, and i think there's a more of a consensus about that than people might realize. how you balance the budget and over what time frame, these are political discussions -- >> host: entitlement reform. >> guest: all of that is very important but i think that certainly if we're going to get back to stability over the next 10, 20 years, think a balanced budget approach is something that people are beginning to focus on. even though the rhetoric might suggest otherwise because of the endless debates in congress which i followed about the budget and the rest of it. i don't think even most extreme democrat is suggesting we run deficits from now until kingdom come. i don't think anyone is suggesting this. >> host: have you talked to american politicians about this? someone like paul ryan or anybody -- >> guest: they should.j>4qi rá'.
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i think it's an important book, trying to bring back this idea of the balanced budget straight into the political mainstream. i'm trying to show that balanced budgets are what made britain and america very, very powerful countries over the time in which they held -- global affairs so it's very timely and important. so i think is very timely and aerva polci >> i tend to be more hawkish but this is being talked about. >> host: so, broadly speaking, using simplistic terms in the public debate. growth versus austerity. is that a useful way -- >> guest: slightly crazy way of looking at it. the argument about growth, which was first -- it's a very new argument in the context of 500 years. in the '60s, the people
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started saying -- it was lyndon johnson, jfk, towards the end of this brief, tragic tenure of the presidency, they started saying, we shouldn't worry about balancing the budget because if we run the deficit, we'll get more growth and therefore we'll be able to balance the budget. the kind of -- what do i do? i have a deficit. let me run the deficit more so i can get more growth and more money in and then pay off the debt. and it's a circular argument and you didn't really larry it until the early 'of '60s and i i talk about in the book. but -- when there was a slump you can spend more money, but he didn't envisage, never dreamt of people running deficits year in and year out. and that name the '60s and
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they adopted the circular argue. we won't deal with is because we need to have growing to deal with this. it's a slightly crazy argument and you hear it now a lot, people on the left are very enamored of this argument but keynes was 31 whet the first world war broke out so his whole childhood and youth was conditioned by a balanced budget framework, and he said in exceptional times you can borrow money. but he went envisaging that all the time, and the analogy i use is, if you have kids, the victorian approach is they -- if they had tv -- you can't watch television ever. ceynes' viewpoint was you can patch two hours and now we have got on the point where the tv is
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always on. so invoke keynes to keep growing the deficit to get growth is wrong. you have to understand him in his historical context and that historical context, is a outlinedded in the book, is that the uk government balanced the budget and that's what the government -- a key function of government and that was agreed by both side, both the liberals and the conservatives. >> host: we talk about china. where is china in all this? described as sort of america's banker, and i interested in -- you talked about the rhetoric from republican politics, mitt romney talking about naming -- shaming china as the currency manipulator on day one -- >> guest: never happened. >> host: talked about the economic nationalism -- >> guest: that's right. economic nationalism has always
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been a theme in america. people like pat buchanan who talk about this, been on the fringes of the debate it if you look at the 19th century, america was the great protectionist country. that's historical. the fact is, as someone described to me, the american industrial base was built behind a high tariff wall. that is just what happened. the argument on the right is very much -- has been about -- or shaded into the, as you say, x actually it's not just about economic nationalism. it's also about having a level playing field. so if i'm exporting cars into china, i have 15% tariff to get my goods into china, whereas if i'm a chinese exporter, you get a 15% subsidy, and so the lower the trade argument is about
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equalizing the playing field do. >> harley davidson. >> guest: yes. these things are always more complicated. the reagan is portrayed as this great free trader but saved harley davidson with the tariff. people remember the japanese motor bikes flooding america and harley davidson was going bust, and he slapped a tariff on these japanese motor bikes and saved the domestic industry. >> host: so, if china had been named and shamed in that way, would would have been the sneak would that be domestic populism. >> guest: the problem is there's still massive demand for chinese goods and you you can't legislate against is. you can slap tariffs -- the naming and shaming, this is the greenspan argue. if we impose tariffs or we -- on china, malaysia and the
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southeast asia industrial base if you like, would provide goods anyway, wouldn't help the u.s. manufacturers. that was his argue. i if you look at where china started from, and we mentioned this earlier -- in 1980 it was one and a half to a dollar. over 20 years, that rate went up to about eight and a half. this wasn't an accident. this wasn't something that just happened because it happened. it was an act of deliberate policy, and the chinese -- the strength of the chinese compared to ourselves in the west and britain and america, if you like, is they have a very long-term view. american politicians were accusing the chinese of currency manipulation in the early '90s. bush one was saying, you guys are manipulating your currency. you're driving your currency down to flood our markets. but of course as a new president, always a new cycle, the chinese kept doing thearñ se thing and they have a steady
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plan and that's what i tried to outline in the book in regard to their own currency. it's very easy to forget this but as late as the late 80s, '85, '86, a bit later than that, china was running a trade deficit if you can imagine that. they were importing more than they were experting, and i refer to various articles in the "new york times" from that period which were saying they have 0 a trade deficit and you could argue that because of the currency, the trade deficit because a trade surplus which has remained. >> host: unusual british politician, you have a sophisticated only and experience of the united states, historically, but you also spent a year at harvard -- >> guest: spent an excellent year in boston, cambridge, massachusetts, at harvard university. 1996-1997, so i lived through
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that crazy period. an interesting time because a lot of my classmates, people who were my age, were going to be traders in wall street, very big salaries, just before -- dot-com years, the go-go years, cigar crazes and all that thing, consumption, high living. it was a quite a kind of wild west period in finance, and of course that all came to a grinding halt certainly after 9/11 and a very long bear market, short and sharp bear market when the tech bubble burst, burst in 2000, and people forget that. that was a difficult time for the marks. >> host: given your historical knowledge of america and your permanent experience, what strikes you as the big differences in the economic and political debates on either side? >> guest: i think in america, people are much more conscious of this whole public spending
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idea. i used to cover debates, look for newspapers in britain -- >> host: briefly for -- what amazed me about the congressional debates was -- i think one anytime '96 they were arguing about $300 million which sound like a lot of money but the budget was 1.3 trillion and this is a very, very, very focused and -- very passionate debate, and i think that level of budget scrutiny doesn't quite exist certainly in britain, and perhaps in western europe. i think -- and the whole language and culture about pork, earmarks, all of that, those sort of terms, these are terms used in europe. >> host: you think new york could learn something. >> guest: i think we could have a more hawkish -- you could argue that the debate was
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irrelevant because people talk about this stuff but continued spending the money so you could argue that all of that intense scrutiny on that didn't really amount to much. but i think having a conscious approach, very critical approach to tax dollars, that phrase, tax dollars, i've never heard the phrase tax euros. i think people here have a more fundamental sense of the idea that taxation comes from the people's work and is spent by the government in europe it's more of a casual acceptance of government spending, the government is spending its money. they didn't really make the connection between -- >> host: a real sense here this is our money. >> guest: that's right. that's right. >> host: and this anger -- >> guest: you're spending it. absolutely right. the we, the people on one skies the government, which is extracting money from the people through taxation, and then frittering it away. that's the tea party view of
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life. whereas in europe i think -- i think europeans and british people have a slightly more benign view of government, and so that benign view means the government is spending money for us, and there isn't that sense of, this is my money. like, the pressure -- >> host: the joke, i'm from the government, i'm here to help you. >> guest: right. that. if you look at the birth of the origins of the united states, it was a revolt against the government, and taxation without representation. that's very much more deep-seated in the american consciousness than it is in europe. >> host: now, to mention tea party, the big political story in britain at the moment is the rise of uk independence party. what is your view on this? are we now in a three or four
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party system in britain? >> guest: it's interesting you raise that. we just had european elections last week in which the fourth party topped the poll, and that is the first time i think since set 86 -- when neither conservative nor labor have won a nationwide election. very significant, and we don't actually know where this will end up. ostensibly their men reason is to get britain away from europe. they want us to leave the eu, but it's a much wider cultural revolt against a political class they feel is out of touch, that is elitist, doesn't connect to ordinary people, lives in its own bubble, drawn from the same type of person, even though they're different parties, all pretty much at the same. >> host: political class. >> guest: that's right. and it's very much an
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antiestablishment peasant revolt type of situation, which in america people are very familiar with. >> host: you into parallels do. >> guest: there are clearly pair parallels. we're in washington now but -- and westminster is much smaller than washington but the same resonance. these are people who go to fancy restaurants, they wear fancy suits, they speak a language that we don't understand. they're completely cut off. their con -- constituents and the spending goes up, democratic or republican, and there's no responsibility no accountability, and a bunch of guys in what you call main street are saying, we have had enough. and there's a sort of popular nye nelly the uk -- smoking, drinking,. >> host: in the pub. >> guest: absolutely. he can get out with a pint of near a way that no politician
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would dream or dare to do, and so there's very much the view that these people are out of touch, and it's time for direct action. and he calls it his army, the people's army, his troops, his party, he calls it the people's army, and that's very much the kind of peasant with the pitchforks and saying they've had enough other. >> host: do you think your party can learn? will it be about trying to brick them into the tent or -- >> guest: this is a $64,000 question. i think -- i expect that the center right -- this is my own private view -- center right in britain needs to have some sort of accommodation at some point with uk. because it's very difficult given our parliamentary system to see how a conservative party can get an overall majority without a lot of uk voters coming back and voting conservatively. they generally are of a
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conservative disposition. i know that people argue but you look at their activists, a lot of them have come from the conservative party. >> host: what we're seeing at the moment in the u.s., 2014 primaries, is a lot of tea party challengers losing but tea partieds being sort of -- really about establishment, the tea party, but in a way a lot of the primary victors are fusion candidates. >> guest: that's right. the difficulty that we have with uk is that they're not part of the conservative party. the tea party generally in the u.s., as far as i can see, are within the republican party. so they're fighting -- >> host: too a degree, yes. also in -- >> guest: they're fighting within the republican party. whereas a fielding of a candidate is a separate party. that may well be a develop of
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the tea party. the tea party could end up being, i suppose, party challenging the republican#;t party, and if that were the case the republican party would have a serious problem because essentially instead of contesting primaries and then deciding on one candidate, you would have the democrats, the republicans, and the kind of tea party representative. >> host: you have that with the ross perot -- that was very much a similar situation where the third party, i think he killed bush in 1992. and that is very much the danger. >> host: we talked about the political class. do you see yourself as a -- >> guest: no. i've done other things. >> host: been in parliament -- >> guest: four years, and i'm a writer, historian, working in a bank. and i think it's quite unhealthy of the professional politicians. i can see why they evolved but i think you need to have politicians with a wider perspective, and that was the great strength of the house of
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commons. the house of commons drew on people from all sort of backgrounds in many ways. manual workers -- 20th 20th century -- people like winston churchill, journalist, writer, quite eccentric characters, people from different walks of life, different professions, and that added to a diversity and a variety. you didn't just hear the same voices. the nature of modern life, people are more specialized, huge culture of being a special adviser or in american case, working on the hill, and i think that has sort of bred its own -- kind of got its own momentum. >> host: you said the three-party leaders in britain are all essentially professional politicians. >> guest: if you look at them, i mean, this is a fact. they were all, i think, born within three years of each other, between 1966 and 1969. exactly the same age. they all went to either oxford or cambridge, and they all, as
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their first job out off of university, worked in politics and that is a fact. and niger, the head of uk comes along, went to private school but didn't go to university, doesn't have a degree so he can say, look, i'm not like these guys. i've actually worked as a commodity trader. i've done this. sbtrz an ordinary bloke, an ordinary guy, and that may be false. he has been a politician as long as i can remember, actually, but it has a sort of grain of truth. and people who are angry, they're not looking for a forensic truth. they're not looking for to analyze all the circumstances. they just want a story, and his story is quite convincing. >> host: your own personal -- sort of obsession in a way in britain or maybe just the
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british press, with class and schooling. you yourself went to eaton,. >> guest: that's right. a very famous school. >> host: as did david cameron. >> guest: my parents were immigrants from ghana, part of the british empire, and my first book what's the empire and i have an unusual relationship with the british establishment as far as my parents, immigrants came in the 1960s and was brought up in london, went to cambridge university, and so i kind of got both sides if you see what i mean. my parents are very much from the old colonial empire, kwarteng is a common name in ghana, maybe not in britain. maybe nor now. and so i could see both sides if you like. but i think -- and with that double hat i would say that there was a problem -- there is a problem, potentially a problem, in that people from
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more marginal backgrounds, do struggle to get a voice. and i think it's very important as a political class we open ourselves up and people who are active in politics or just in britain, but america, should be more open and a much easier way for people to come through and get representation. and maybe be representatives themselves. but the nature of the media, thr nature of modern communications, modern life, if you like, means you have be to specialized and decide to do that at a relatively young age and that creates this class, i suppose. >> host: now, is it three books you have written in the last four years? klesko is the three books you have written the last four years? >> guest: two big ones and a couple of others. >> host: i notice you have not tweeted since 2010. [laughter] i know you have kids. even so how do you manage to write something as thoughtful
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and wide-ranging? >> guest: that's very kind. i think two things about writing a book, the smallest thing that anyone said about writing a book was winston churchill. he said it's like building a house. you have to work out how many floors the house have sent external structure of the house and you have to work out how the rooms and bedrooms will be before you worry about -- klesko and churchill actually built houses. >> guest: you have to have a structure how your sofa is going to appear. you have to look at the actual structure. once you have a structure than the second thing about writing a book and it's an african proverb if you want to e an elephant you have to chop it up into little pieces. once you have the house and with a book like that they think you
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were slid out of thin air. it took six years. i was thinking about it before. let's go your ph.d. was in economic history. >> guest: that's right. when i spent my year abroad in boston these thoughts have been evolving for quite a while. i never was interested in gold and being from the african continent my home country was the gold coast so there were signs that interest in looking at politics in terms of finance and i worked for a bank for eight or nine years. all of that came together and i gradually took a gradual approach in writing the book. when the book appeared they said how did you do that? it must have taken me three months must have taken a three month but ask it takes a much longer time. >> host: did you have a routine with a certain number of hours? >> guest: there were routines in the week. saturday afternoon was a good and in the recess i try to
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allocate a bit of time every day. the eating elephant thing if you just do steady as you go and then if you have a clear idea of what the book you want to write you can actually get there. the danger is you need to keep to the structure and you need a plan. if you don't have a plan it's practically impossible to do something like that given the pressures on the constraints you have and the amount of time you spend in the constituency. my constituency is quite close. i have been to the national archives and my constituents are interested in their family history and as a hobby. people have hobbies even if they worked very hard so it's not something that i see is work really. >> host: although extremely relevant. >> guest: if they work very hard. it's not something that i see is work really. >> host: although extremely
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relevant. that historical perspective is something that politicians sometimes lack. >> guest: i think it's key to trying to understand modern politics. i think it was winston churchill or someone like that who said if you don't learn from the past you are condoned to me the same mistakes. >> host: i said from the beginning it's not a politician's book. it's not polemic and you are not judgmental. does this help you political career? >> guest: i think in the long run you have to clearly set out what your beliefs are, where you are coming from if you are coming from intellectual hinterland if you like and that has to help the political career in the end. i think certainly in britain and
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i'm not sure about the united states the united states there's always been a big connection between understanding history and politics. we have a long tradition of historians in politics and politicians who write history. churchill as i mentioned many times was the greatest example of that. he wrote reams and reams of history throughout his career. he read the history of the first world war and six volumes. i have no idea how you manage to do that but people like lloyd jenkins. lloyd jenkins our current foreign secretary hague has written volumes and famous politicians. something that is quite connected in britain this link between history and politics. i think that's quite healthy actually. >> posted is a great quote from norman lamont who said politicians don't have the luxury of expressing doubt. i sense from here you use the word nuance quite a lot but you do have a new once approach.
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are there that are there other things that surprise you and things that actually changed your view? >> guest: they did. if you look at this whole idea of government spending i mean what i was amazed at was the extent to which we are living in completely uncharted territory. as i say hundreds of years before the gold standard and really in the 60s the people challenged britain and america challenge this idea that we have to balance the budget every year. this idea where we are running continual deficits and we have paperback currency for money is quite new. it's not something that happened and certainly after 1971 you know the extent to which we were spending more money wasn't as pronounced as it is today but these bailouts. >> host: so they're there's sort of this new normal. >> guest: doesn't have to be that way.
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more than 10 years ago who had ever heard of that? i think i first -- first heard that in 2007 and that it became one of these received phrases. you would think it would have existed but it didn't. it was news to the extent to which today's situation and today's circumstances are relatively new for was something that struck me. >> host: what of your political career? i think you have been floated as a british -- >> guest: every politician of color black ethnic whatever in britain is touted as the british obama which given obama's poll ratings isn't something one would necessarily respond to. we have to get through the 2015th election. i want to hold my see what i have to do. majorities can come and go and
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it's something you've got to keep an eye out. that's scary where we are for 2015. the whole political sort of career thing, debate in terms of where people are going is dependent on your party's success. obviously i'm hoping the conservative party wins out and mike grier will go on a different direction. if we are out you know who knows what will happen? >> you wrote another book. >> guest: well, i'm toying with it. i am interested in market bacher. she said key person in the book. i know charles well. he had been working on that for a long time. thatcher was one of those figures in british life who immediately became an iconic figure. once you died in new as someone that people argue about for decades to come and i am nearly
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40 but they're few people people in my lifetime in britain who have that iconic status. i mention churchill. he died 50 years ago. this was before my time than thatcher for my generation with my generation what do you love her loads to her was a i'm very interested in her leadership style. not just that she was a woman and she had a nonconformist methodist background, she had a lot of imagery which she used, she was almost like a sort of preacher in terms of her style. >> host: she was a big inspiration to you. >> guest: she was. she was an inspiration. she became prime minister when i i was four years old so i don't remember that. the day she left i was probably 15 and a half so that was a very long time for she was the dominant figure in british politics. a whole decade where she was prime minister and i liked her style of politics.
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i like conventional politics. i like the fact that she stuck to her guns. i was doing a bit of research about her. three days before the election she said i'm not a consensus politician. can you imagine someone saying that three months before a in a lecture in? if you want to compromise and all that stuff vote for someone else. i stand on principle and i think there's something very attractive about that. i can see it creeping into american politics certainly with the republicans trying to trim their sails to whatever wind is passing it is difficult for many people to see what the republican party is about. many principle and we need some kind of clear convictions. the danger of that is that people might not like your convictions. klitzka that's a risk you take. >> guest: that's the risk you take but there are certain ways in which -- she had incredible medication skills. i think i was very attractive at


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