tv Washington Journal CSPAN August 7, 2011 7:00am-10:00am EDT
china the major holder of u.s. debt be rating in an editorial state run newspaper for addition to debt in germany and a news magazine calling the downgrade a public humiliation saying friday night it downgraded from trima to double a plus because of political brink man ship had made government as built to imagine it's financials less predictable and the debt proceeded the downgrade and in case your interested has essentially what's a tick-to be of how the events unfield ed afraid afternoon. the treasury department asked the & s&p to wait until friday. right to your calls and recac
reactions. sam from albany new york. caller: hi. this is i'm sure there's thousands of other people beliefs that dick cheney is to blame for everything. >> why is this. caller: he's not finishing but his tea party is coming and i can go on and on and on. host: david next from denison, texas. republican line. who's to blame with the downgrade. caller: hello. boy that was quick. yes, part of what's confusing me is listen to the moodys guy in his interviews talking about the politics part and it sounds as though he's blaming a big part of the downgrade on the political uncertainty that all of the back and forth cause
which indirectly sounds like he's blaming the tea party and certainly think as far as biggest number of media outlets in the discussion, they keep turn together the tea party and tran si guy enforcemen transients and in terms also of one of the bills the republicans sent that call grass constitutional amendment which was roundly turned down with the rational that they didn't want to improve a the amendment which us wasn't approving the management but the states having right to it wasn't taking a vote in the affirmative did that mean they were going to do it. it seems odd to me that moodys
would take such a position. seems they would take the opposite. after 60 years it's obvious that congress can't be trusted when they get there to take dare of the money and take care of our budget. >> david, thanks for the call if you log on to s&p's website an eight page explanation to why this firm that added and down grades credit rating. here's the essence of what s&p said friday. it reflects that that the fiscal consolation plan that the congress administration falls short of stabilization of the government's medium term debt dynamic. the reflective part of american is a g stability have weakened to a
degree more than we envisioned from back in april of 2011. from the washington examiner. blame seems to be the common theme in the number of stories. downgrade verdict. stop the blame game is this editorial. our fiscal plight is report to paying too little to the government but the government paying trillions more than it received. stop spending more than the government receives in tax revenues. lucas. minneapolis. live, independent. >> yes, i us was just thinking this is probably something that the republican donors have put them up to. so that later during the election they can say that president barack obama was the first president to take our country into it's rating getting downgraded. i think there was also even a
mathematical error found in how they put the numbers together, but i still look at this as being a political ploy for trying to discredit this president. and even though i'm an independent, i think he's been too bent too far backwards to work with the other party when they're not willing to move at all. caller: yes. host: available this story on-line. s&p spurs the blame game. writing american's political system is subprime seems likely to firm a public backlash at less than the top shelf ranking it had given the mortgage backed securities for the financial world implosions and ratings will not be on the ballot of november of 2012 for. everyone that will be on the deficit reduction spawned had
been raised rather than forcing conciliation the political class will dig deeper the report and to begin trading blame. that story is available on-line. check it out at "politico". good morning. democrats line? caller: good morning. how you doing? host: fine, thank you. caller: i blame the republicans and the tea party. i call the tea party the confederate party. i'm from the south and when they integrated they started at conservative person party but nothing but a conspiracy against the president of the united states. they're trying do all they can to make sure that the president barack obama does not get re-elected again. because they didn't have too wait to the last minute to pass
this debt ceiling. it's totally different. it's nothing but a conspiracy against this president. host: thanks for the call. political story inside the headlines. republicans jock as big week begins in iowa. the republican party will descend on them to present parties to party activists. some are ready to beat the drum beat of criticism against which contender could best defeat him. debates include one this thursday carried by fox news channel and then straw hole six of the republicans participating and live coverage at noon eastern and on c-span radio. we'll have a chance for you to weigh in and have analysis for those inest main.
the aims straw pole beginning at noon next saturday. charles from cleveland, ohio on the issue of who's to blame with the s&p downgrade. morning. republican level. go ahead charles. >> i'm going to speak honestly and i don't think most people will agree with this. we have politics in washington d.c. that are sure being played. we all have an and in this and we should have been downgraded probably years ago and this one step downgrade not going to chose. our credit rating should have been dropped substantially further. just all about money in politics and it's quite sad to be honest. the >> charles thanks for the call. join the conversation on-line. or you can send an e-mail. journal at c-span.org. from the hill.com. senator jim de withsaying tim
geithner must go. the president should demand he re-assign and immediately replace him with someone that will help washington focus on balancing the budget and allow the private sector to create jobs and debt ceiling increase. opposition to a series of spending has been recognize less and now the american people will pay the price. republican senator from the hill.com calling for treasury secretary to step down. bonnie. welcome to the conversation. >> good morning. thanks for taking my call. i think that this downgrade was the greatest gift our country could have been given. we need to stop it. i'm fiscally a conservative. but obviously i'm an independent so i will vote for either but i really am tired of the politics
of both the republicans and democrats. we desperately need a third party. strong, a leader who can speak the truth to these people. it's crazy how they, it's so crazy that they cannot sit and communicate. everybody knows that we're bankrupt as a country. warren buffet said that. we need a handle on this debt. and it's important that we sit down and compromise and get, you know quit giving money away when we don't have it. we can't support other countries. we have to look at the department of energy budget and all of these, you know because that's where the bombs are built and then look at the double books that they're taking in the
pentagon and get some sense going on in this. you know. and knock it out and quit the politics period. >> you think that can happen in this political environment, bonnie? >> i don't know. i think we're so polarized i couldn't vote for either one of them at this point even though i voted for president obama and so want him to be successful. and i mean, i really can see where he is tried to do everything he can. but it's almost impossible and it seems like everyone is so invested in being right and having their way that there's no wiggle room for compromise anywhere. >> bonnie, thanks for the call and the comments. the man behind the s&p downgrade is john chambers joining on a conference call explaining why a
division of s&p got announced of a downgrade friday. there's a follow up on the "new york post". downgrade doer was no business whiz. the wall street bean counter that trashs the credit rate sag new yorker that never studied economics and majors in literature and philosophy and had a masters in english and will it ra sw literature. the standard & poor's private agency that wrecked havoc friday night by notching down a united states credit to double-a from triple-a. he was a swinging stand out ranking eighth in the all-time school history for the one thousand meter free style after graduating with a degree in will it assure and philosophy. went ivy league.
s&pest mateed a 2,000, estimate error. in the fact that deficit reduction cuts did not even total four trillion dollars as recommended. read more by checking the story on-line at "new york post".com. there's this from gary duncan saying democrats see a conspiracy behind the downgrade it's merely a wake-up call. we're spending too much and shoe no willing to stop. democrats line. who's to blame for the s&p downgrade? you? caller: i have to agree with you steve and both democrats and republicans are to blame but particular peeved at republicans who are now coming out and claiming they're true conservatives and concerned about the deficit and they kept on saying debt doesn't matter
and this was proved and on the business. they pursued policy where they spent and gave us this brutal accounting where we were of the impression that the depressions but five hundred billion. this one came understanding that the deficit is actually a little over or well over a trillion dollars. and you can't trust politicians. they are in the business of spending it's so embarrass together listen to them from day to day. i wasn't born in america i came from jamaica and i know what this is now taking hold of jamaica from the united states america in terms of the income disparity and what it's going to do to the country and we see that trying to divide the country. it's unfair. if you earn 8% of the wealth in the country you should pay 8% of
the taxes it's ridiculous people that earn 20% of the wealth in the country are paying greater than 20% of the taxes and the businesses that earn more and all the wealth make greater use by the taxes could pay for so they ought to be not paying more taxes and people should, another example of the deception is the size of small businesses. your all politics talking about small business. thought this was a corner shop in the community. look at that the definition. talking about a small business being one that has 500 employee? 100 employees depending on the type of business. how can add a business be small fits employing 500 people? that's pathetic. >> appreciate your perspective. karl has this comment from new
mexico. the president gets to take credit when things good and then when things bad, you cannot continue to spend and spend. and expect that your bank account will grow. meanwhile, dennis lane has this point from our twitter page. most in congress have been entrenched like america's corporations for much too long and feel entitled which is dangerous. perspective from overseas. the leading for man publication has this from on-line. precipitous market declines, panic ruled the international markets. blue chip companies are on the decline. traders. shedding stock in large numbers and uncertainties should have been calm this week. the u.s. on a debt default at the last minute in europe. the european central bank are reacting with alarm over the weekend. the european bank is again buying government bonds from
crisis plagued countries energy colluding ireland and portugal. the european president. jose man well bah roe is a raced the idea of the raising of the funds. vinny from nevada. welcome. >> how you doing. why is it not been reimportant that on page four of the report from standard & poor's it says, i quote, we have changed our assumption on this because the majority of republicans in congress continue to resist any measure that would raise revenue as position we believe congress reenforced by passing act. clearly in black and white that standard & poor's blames the republicans. i think it's complete nonsense what's been going on and although i campaigned for president obama, i will be
supporting anybody who primaries him from the left. this is total nonsense what's been going on. thanks steve. >> vinny thanks for the call. speaking of taxes in the new york times the truth about taxes. there's no credible budget fix without more money coming. standard & poor's made a comment about no new revenues deal lowering the rate one notch. editorial point out thes federal bureau of investigation. pell grands and the national institute of head starts and not cut $110 billion annually. entitle reform is essential but unlikely lawmakers will agree to any. here is the bottom line. there is no economic sensible or political a dress of the deficit without increasing revenues and reforming the tax code and
there's a list of major challenge as head from the "new york times" you can check it out on-line as well in "new york times".com. minneapolis. caller: good morning. yeah i wanted to say that i followed everything that that was going around during the debt crisis and my heart sunk after seeing how close we got to actually destroying our economy and now we seem to have gotten our ratings dropped, but at this time, all i would like from congress on both sides is if both of them would step up to the table and say, you know i'm sorry for digging into my trench, but it's time we work together. without them actually trying to pull together, and giving on each of their class forms we're never going to get through this. >> thanks for the call jackie. from our twitter page another
comment about the issue of greed. jody has this point. the fault lies squarely on giving wall street it's way. greed has led us to the point. sad but true to hear that so call sucking sound. the headline is below the fold as political parties trade blame for the u.s. rating downgrade our focus on this sunday morn. shawn from fort wayne indiana, good morning. republican line? call caller: yeah. s&p made it clear if there wasn't 4 billion in cut this were going to or 4 billion taken off the top end they were going to downgrade. i know some people must be shocked but they actually kept their word and said that they were going to do and did it. that's unusual but that's what happened and hopefully is it a wake-up call and you know,
republicans have caved for years in the, you know, 3-1 cuts for taxes. 2-1 cuts for taxes and the only thing we ever seem to get is tax hikes. so i'm glad for the first time in, you know, since the creation of the public party, they're standing on not raising our taxes. host: shane thanks for the call. good morning. caller: yeah. excuse me. this is predicted back in 1999 when republicans controlled both houses of congress and repealed and put us in the hands of robber bah ronses. this happened the early 1900's. 1929 with the depression one percent of the population controlled 22% of the wealth.
now one percent controls 24 percent of the wealth. the robber barrons are back and they took over and caused mortgage to fall. 2001 and 2003 bankrupcied us. 2 trillion is owed to the federal workers pension. the debt isn't 14 trillion. they owe us five trillion. when they start paying that back with interest like they did with china we'll get our economy back and bring back the things that will straighten out. you have to raise taxes or we're going down the tubes and those echo terrorists if i was fbi, i would be putting their butt in jail. caller: yeah. host: republican response from up state new york stock exchange republican talking about u.s. economy. hear more from the weekly
address from the president. here's michael from new york. >> republicans are focused on a strong job road ma map and expanded american energy production. these for kinds of common sense solutions to give job creations certainty to invest plans and create jobs. host: democratic response from the president in a few moments. the thing we're focusing on. pictures from afghanistan and some headlines including the l.a. times and this from the denver l.a. post. worse day for the u.s. is the headline and from the orange country register. 38 dead including the e let navy seal team. covering the story for the los angeles times she's kabul,
afghanistan. thanks for being with us. what can you tell us what happened friday the death toll and is the taliban responsible? caller: that focus remains unchanged. the claiming responsibility for the downing of this helicopter, but military officials say that is probable but not conclusively established so that's where it stands a the this point. host: we know these are member of what is viewed as elite navy seal team. the same unit responsible for the killing of bin laden but not the same team? caller: right. not the same individuals. ho host what happens as best you can tell on this sunday morning caller: well these night raids of the type that took place when this occurred happened almost every night. sometimes several times a night.
elite troops of why value targets and often go to a remote area like this one and this time it seems the insurgents might have been tipped off and were waiting for them. host: many expressed sorrow and sadness but this is an issue brought to the male tear over the years trying to get an end to the air raid. have you had reaction from the afghan government? >> not any further beyond mr. karzai's statement but this is a very serious on-going issue and he's called on a number of occasions for these night raids to be stopped and nato did not go along with that request. it's something that's probably going to continue to be an issue. we don't know whether at this
point there were most or more raids last night. seems particularly it would be out of commission for some time, although it's a large unit and they do have the capacity to continue with this policy if they want to >> in the reporting over the last 24-hours we're reading where fusion cells what are they and how are information being transmitd to potential terrorists that may want to harm u.s. troop? caller: that's not really something i've been following from here. host: information readily available to people on the ground that want to harm the u.s.? caller: information in terms of the movement office american forces? host: yes. caller: certainly there is the insurgency. one of the great strings is the huge network of human
intelligence and it's ability to follow movement even in very remote areas. perhaps especially in remote areas. host: laura king of the l.a. times. afghan correspondent from kabul. will the incident and tragedy change how the helicopters are operated or the u.s. military transports soldier? caller: well that willing among the commanders and troops here are very dependent upon helicopters because of the terrain and long distances. it's not practical to use ground transport exclusively so hell cap tears helicopters are a big part of the transportation around the country. host: thanks for being with us on this sunday morning. caller: thanks for having me.
caller: wars worst day. 38 dyna cop t die in a helicopt. s&p. who's to blame. fred in jacksonville. welcome. republican line. caller: this is bud philips. you know, i think we need to quit blaming anybody that what's happened is primarily due to the american people putting wrong guys, not just the president but congress, i mean it takes years and years and years to get experience. the functioning at that level in an effective way. you know, college, most of those people are lawyer and they've got all kinds of educational experience but, experience and
wisdom is critical. it's absolutely critical to be successful at that level. with that much money. i sort of compare it to people winning the lottery if they don't have the experience and wisdom to handle that kind of money, they go broke and that's what up with this country. we can contribute it to the system. it's not democrats or the republicans but the people that elect these guys. put these guys in office. with no experience and most places they're young and in their 40's. i happen to be 79 years old so i know something about wisdom. i think the american people need to quit blaming the other guy and look in the mirror. host: thanks for the call. s&p paul says is not telling us anything we didn't no on taxes
not paying their fair share. from su with john baner's fault. too worried about losing his job. speak arer of er of the house a. ron reagan and the policys and know the the realities. here is a story on-line at national journal.com. first ever downgrade begs the question? double dip or fblip. the nation losing it's top notch rating from standards and poors so. awful friday's announcement of new jobs felt like an achievement. many economists said the double dip recession could be on the horizon due to a sour turn in every economic indicator in the u.s. recovery. markets are showing fear through
major sell-offs around the world this week. no question it's a scary time. how scary is less clear. jim tries to break it down. that story available on-line at national journal.com. the president said he wants to pivot the jobs in the economy. week from tomorrow he'll begin a three day bus trip including stops in iowa and lil noise and yes talking about johns and the economy. >> time congress passed trade deals helping to replace workers looking for new jobs and help to sell more products in asia and south america. products stamped with three words. made in america and we ought to give more opportunities to all those construction workers that lost jobs when the housing boom went bus. we can put them to work by giving money to companies that want to rebuild america. those are a few common sense
steps that would help the economy and these ideas have been supported by democrats and republicans in the past. >> from the weekly a. meanwhile the sunday review has the opinion of drew west on from emmory university. what happened obama. he the president failed grab the narrative to take his place in an important historic moment. read this in the "new york times". gene from tulsa oklahoma. >> i think that the grove not to raise taxs is in contradiction to what the institution of the continues constitution says the congress should be able to do which is imagine our fiscal policies and i think it's almost an impeachable offense to the
people that are selling that. that's my main comment. >> thanks for the call. next is paul from mississippi. good morning. to you. caller: how you doing? ho host go ahead. caller: i am [inaudible] i worked in jobs with our government in the military and worked for [inaudible] and a lot of governmental waste goes on. the working man out there, you get out there and earn $50,000 and the taxes are killing you but you make a couple of million dollars and you can write everything off. taxes need to be brought to a bare level. host: join the conversation on twitter.com/c-spanwj lt bill says unlimited power to destroy
quoting daniel webster. stephen byr on the republicans and tea party have badly damaged the u.s. it's credit rating and the house of representatives remains in control we're absolutely and without a doubt heading for a traumatic depression even worse than the one from 1930. ray has this point. complete irrefutable evidence of the failure of the president as leader. as teleprompter talk doesn't cut it with real issues especially economic ones. appalling lack of response is telling on degrade. west africa. good morning to you. >> good morning, sir. >> welcome to the conservation. how are you watching from africa. caller: through 1r08. i'm beginning to wonder if there's not a conspiracy theory against president barack obama. he already doesn't have anything
to do with whether it's mr. obama or other president in power. the economy of the u.s. is very bad right now and definitely you know, you need time to get it back on it's feet and really, find it all the things that have been hearing over the last few days, i'm really worried. whether these credit rating agencies really want american to get back on it's feet or where, you know they just want to have president barack obama out of power. it really does not have anything to do with president barack obama the economy has been going from bad to worse every since president bush was there when he used to talk about the fundamentals being strong. yet everyone knew the economy was down and where were the agency. they never said anything about you know, this looming crisis
and today the grown grading. u.s. credit rating and i feel very sure. you know. i was a student at baylor university and i studied international economics and i really don't think sis is fair. is not fair. host: thanks for the call. from the sun dibusiness sessions pressing the buttons for a pan ache tack. more perspective coming up later in the from program and from bloomberg news we'll get an explanation why the downgrade and it's impact on the global economy. russ from lula appear, michigan. good morning. caller: good morning. thanks for taking my call and god bless those troops that were injured. a couple of key points i'd like to make is that both parties are certainly at fault for where this debt issue to today. yesterday i saw an interview
with mr. chambers from the s&p and he had really a key statement i thought was pretty important. he was asked directly what he believed to be the leading factor of why the town grade actually took place and from his own mouth, that i watched and that i heard he said, it's two key points. one the lack of leadership in the government. not to grab on to any kind of control and see this thing through to a successful outcome and number two, excuse me. he said. cut where is not deep enough and he then clearly called and stated like the paul ryan republican plan called for in the 4 trillion in cut that it didn't go deep enough and the last point i want to make and i also think it's very important is that america seems to forget it was a democrat that took control of both the house of
representatives and the senate under president bush's last term in office and then they take over super majority shortly after that. and to this day, they still have 2/3 majority so all these folks that keep blaming bush or blaming president or saying president barack obama needs more time. my question is, how much more time do the lib call democrats like harry reid who clearly says the paul ryan bill is dead on a rival with no debate or discussion with no plan from their own or our president i think the answer is clear. they're both at part but one party is not leading right now and the only par cione that is republican party. >> from our twitter page. john from north care lie. we elected a president and congress that spend like school girls at
the mall with a credit card. we got what we voted. when everyone is responsible no one is responsible. republicans are clearly responsible by passing a clear bill and working a part to address the deficit. republican objective to work for the failure of the president. middle class will pay the price with increased rates on credit cards and mortgages to an infrastructure projects. 8 page summary on-line at s&p.com. get more information on why the agency lowers the u.s. credit rating. here's the essence. the downgrade reflects our opinion that the fiscal consolation plan that congress agreed to falls sort of short of the medium term debt dynamics
and the predictability of policy making and political institutions have weakened at a time of on-going fiscal challenges more than we envision to the rating on april 18th of this year. ely from syracuse, new york. independent line. caller: good morning. i'm so disheartened. i have worked all of my life and paid my taxes and my bills and to look and listen to the republican party and the things that are going on. they have no clue of what the regular working people go through. and to blame president barack obama for what he was handed? how do you get ahead. you look and reflect. we had, how did we get here. what mistakes we make. democratic congress. passes $420 bills the first year
that president barack obama was in office. the senate passed nothing. those bills went over and laid there because of the filibuster from the republican. it's so horrible to see how many people want the demise of this president. i'm going to work my tail off to get him re-elected. i think he deserves it and as far as republicans. e buyers remorse is coming. host: national news media are trashing s&p instead of accepting which is true. can't spend 40% more than we bring in. london daily mail. different take on this.
the headline is world markets plummet. in california over the weekend and i'll the markets plummet. osbern on holiday. from the "new york post". this editorial cartoon. it should start now the president, with the debt deal and the economy. see the car is abjure fire. now to albert. call all good morning. i'd like to say that i blame the republican party because they, as far as mr. obama trying to bring it back they're working hard to bring it down. how can you work with a party like that? if the economy don't come back up and they don't then the people going to be robbing each other. you won't be able to come out of the grocery store because you can't feed yourself. they don't care about the
american people's and one lady could and said that, about the, well no mind. anyway but my last point of the thing is they don't really don't care about, and that thing with afghanistan. republican party is responsible there. they got to get something on obama and stop him from running over there and they probably over there on vacation to stir up something. host: albert we'll let your point go. mid criticism. s&p fires back. unusual saturday conference call with reporters. senior s&p officials insisting they had not over stepped boundaries "in focus"ing onous much as fiscal policies in determining the new rating. debacle continued until the midnight hours. of s&p's sovereign ratings committee. another committee official over
the weekend adding the fiscal policy like others is fundamentally a political process but rather than building consensus on how best to reign in the negative nation's staggering debt the downgrade left political leaders as divided as ever and used position to bolster their own ideological positions what we're focusing on. marry from corn wall. republican line. caller: hello. like i told the man that answers the phone. the reason all this started is when clinton got in he imagined to take away the glass siegel fact from wall street and they never ever paid their full share and the last ones they had to pick was middle class and they got him to make those prime
mortgages or prime rates or given mortgages to anybody and everybody and that's what started down fall. you know it's like the old story that are a bit and the turtle. you can't go trying to be the heir ha ha hare. the turtle lives 125 where the rabbit only live as few. host: another caller said people need to stop blaming the tea party. elected by americans and i'd like to see both parties salaries cut and lose benefits and term limits could be considered and a retweet saying democrats have simply spent so much money we don't have what the people are scared to lend anymore. the republicans will fix all of that in 2012. more on what this means for the economy. what we can e expect tomorrow
with an expert covering this for bloomberg news and financial advice coming up later in the program and marvin along with his daughter. new book on vietnam. first a look at the other topics and guests. all of which can be heard on c-span and is in the c span studio. good morning nancy. >> c-span airs five radio talk shows "in focus" afternoon. nation's economy. presidential politics and the situation in syria. begin at noon eastern with nbc's meet the press. david gregory welcomes john kerry and arms services ranking republican member john mccain and then chairman allen greenspan and austin goldsby. abc's this week. christian o m poor talks about
and jeff sessions and gloria steine m and robert ford the u.s. ambassador to syria. fox news begins at 2 profit margins and they'll talk to paul ryan. leg mason executive and republican presidential calendar tim polente. former republican presidential calendar steve forbes and the economic council in the obama administration. harry summers and california democratic governor and former republican congressman tom davis. then face the nation. bob sheafer talks with david axelrod. former democratic chairman how a howard dean and lindsay graham. all brought to you from c-span
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0. these are the stakes. to make a world in which all of god's children can live. are to go into the dark. we must either love each other or we must die. >> vote for president johnson on november third. >> this weekend we'll look at the history of political campaign adds with robert mann and former homicide detective on the day that jack ruby killed lee harveys would and president nixon looks at messages crafted and given to the public. get the complete schedule at c-span.org/history. "washington journal" continues. >> we want to welcome.
veri jenneane. this is what it looks like here. let's take a look and ask you about s&p. what's it mission and why was it formed? >> standard and poors is a credit rating agency. what it does is looks at companies and governments credit and looks at their debts and ability to pay and then we'll assign a score to in this case the united states debt. and as we know, it was downgraded from a triple a which is help for 70 years to a double a plus. >> 23 offices dates back 150 years and is the parent company is mcgraw hill? >> correct.
host: report over the weekend. the essence and i'm paraphrasing but talked about the political gridlock in washington and the effectiveness and predictability of american policy makers and political institutions weakened at a time when on going fiscal challenges need to be addressed? >> s&p had laid a marker in the sand. leading up to and endureing the debt debate between congress and the white house and the line in the sand was that s&p believed united states needed to cut it's debt by four trillion dollars. the grand pa bargain. instead the deal led to at least a reduction of 2.1 trillion. falling short of that. s&p had warned it would downgrade the u.s. credit rating and follow through on friday. host: washington examiner.
lot of editorials. stop the blame game attend sense is that washington cannot spent trillions of dollars. it's time to reign in federal spending. >> congress and the white house are trying to do this this debt deal does as i mentioned. would reduce spending over the decade by 2.1 trillion dollars. but s&p believes that much deeper cuts need to be made to put the economy or to put the fiscal situation on a better path which would also lead to more economic stability in the long-term. >> yet from the "new york times" there's no economically sensible or politically onnest way to do it without increasing the revenue and enforcing the tax code. >> that gets to the heart of the political debate that rageed
washington over the last acc several weeks. there's difference between republicans and congress over the best way to put the nation's fiscal health in order. so white house is had the president has said we want to have spending cuts and have increases in taxes. so republicans have said, we want it to be through spending cuts and not tax increases. >> this takes from the "washington post". panic part two. the next time someone tells you this is the fault of wall street or the republicans or china. respond with this number. 138 percent s that's u.s. household debt to disposeable income. there's no way to restore it until it returns to a more sustainable level.
it nows far above the historic average no matter what foreign politicians may do. ordinary americans have work cut out for them. that's very true. as we know leading up to the crisis. americans were buying on credit i. was a credit bing. they went out and bought houses. with on credit. they bought goods on credit and now they are trying to get their finances in order by send spending less and buying fewer on credit. this is one reason why the economy is very slow. it's growing an a weak pace. >> the white house announced that joe bidn will travel to china next week. this is back to when he travels over there. headline getting attention is chinese state newspaper with editorial. it's time for the u.s. to cure it as to debts and it must live
within it's means. this is the story from the "new york times" your reaction. >> the vice president will have a delicate economic and diplomatic, dance beforehand because china is the largest holder of u.s. debt. chinese care deeply about how the united states handled it's finances because it's sitting on top of the largest amount of treasuries. so they care that there's a downgrade and i'm sure they'll have a lot of questions to ask the vice president. >> about 1 point 1 trillion and it's in china's best interest to have a strong u.s. economy. while it may criticize doesn't they want to make sure there's growth for its own investment? >> absolutely.
the chinese have a, we're very link to each other china and the united states. because they are the largest holder of the our debt it wants to see the united states perform well economically and financially because it's going to, it's fortunes will rise or fall on how the united states performs. >> albany, new york. welcome the calls to join the conversation. bloomberg news. liz on the independent line. good morning. >> good morning i'm an independent and i don't know the particulars of what goes on. but i do see the overall picture. and to me, the overall picture is let's see. it's everyone's fault. you're talking about consumers and it's consumers fault. it's our government's fault.
we're developing a robber barron class at this point. the times just carried an article last week about these retail stores why end, doing very well. we have companies breaking unions currently ver rer is on strike and it's similar fashion after wisconsin and people are involved in politics? it's a class warfare at this point. it's not political any longer. it is social. and we really need to take our country back from the poor leadership that we have been experienceing for the last 11 years so that's all i have to say. thank you. >> let me pick up on the last point. the last 11 years. both democrats and republicans have had control during this time period of the white house.
five trillion dollars increase in the debt since bush and 4 trillion under obama. half of the 14 trillion debt. where we are today. >> well the country is fighting two wars and it has reenforcemently had to deal with two recessions. one in 2001 and one in 2007, so there's two major areas where there's been a lot of spending going on. one to support the wars and another one to support the economies through stimulus. it's a difficult situation. >> from bloomberg. dubai shares dropping the most since february biggest since november of 2006.
what's going to happen. with the market. seen it tumble and know there's a g7 meeting early tomorrow morning in anticipation in the foreign markets opening up. what for potential possibilities for tomorrow? >> there's a number of scenarios. one is that the stock mark set down in just seven days so there's an enormous amount of volatility. a lot of concern about how the u.s. economy is performer ing l a- loan the market town grade. common day when markets open. one possibility could be that there will be a rebutted reaction because there was an understand that the s&p could in fact downgrade and did. there's two other major rating agencies that have left the u.s.
credit score at triple-a. research in the past shows that there's less economic and financial fall out when there's just one if you had all three rating agencies downgrading at the same time, potentially more impact could be felt. at the same time there's a lot of nervousness out there. there's things going on outside of the u.s. shores. europe is dealing with a debt crisis. and there's been a lot of feedback over that. there's concern about the slow down in the united states rattling markets elsewhere so it could be more pronounced and it's hard to tell. >> cindy outside of buffalo. democrats line. good morning. caller: thanks for taking my call. you're probably the best host on the program and i appreciate your taking my call once again. one of the things i would like to report to the guests and
answer this question is i was looking at the stations late last night and i saw the credit for it the other guy and paused it because i thought, my god they're giving me facts on what happened. the ratio of what the pro fit was for the executive and what the little man is making. 500/1. i'm thinking the media did not report this at all when it was going on. i blame the media a lot because we're not informed. secondly the tea party and the president for clumping the democrats and republicans saying we're not compromising. democrats have compromised enough but i totally blame the lead you. you did not report the fact that we were robbed and now it's going on with the post office. there's money there. what's going on with social security? there's money there. wall street wants their hands on it. the media has to do a better job
and steve, thank you. have a nice summer and i hope all of us can have eight weeks vacation like our congressmen do. thanks again. host: you want to respond to her point? >> i believe that urinisjourna are trying to keep on top of the news and there's a lot out there. there's also a lot of news for readers and viewers and listeners to keep track of. host: our guest is jenneane. the federal reserve is meeting tuesday of this week. what's going on happen? >> good question. there's a lot of debate over that. the signal so far from federal reserve chairman, ben bernanke is that the fed is likely to debate what additional steps it could take to help energize the
economy. it's growing at a slow pace. only zero.8 percent at the last six months the first half of this year. host: eight page summary if you want to read it on-line at s&p.com points out that first of all. s&p. let me read the exact language. our revised scenario with other things equal review is consistent with a possible further downgrade to a double a long-term rating featured less favorable economic assumptions and an assumes the second round of 1.2 trillion does not occur. so the difference between a double a plus and a double a rating means what? >> well it would low tear u.s. credit score further that could mean that the u.s. cost to
borrow would rise and investors would demand a higher rate of return in order to loan money to the u.s. government. there's a potential there, not sure to borrow where markets will be an important sign. if yields on u.s. treasuries start to rise, that will not only make it more perspective for the expensive for the united states to service it's debt but it has a ripple through the economy and would make loans to consumers home loans. and other types of loans more expensive. >> outlook is negative writes s&p. tomorrow effected rated in funds and financial institutions and structured finance sectors can you explain what that's all about? >> well the s&p rates all
different kinds of debt so it'll be looking at other types of debt in allowing a credit score it to. there's a lot of interconnection to what happened the downgrade for the united states and how that flows through and effects other things. host: our next call is pete from waco, texas. welcome to the conversation. caller: good morning. i talked to you about a year anding an and we had to cut about half of our 700 workers. we have a $1.5 trillion deficit. let's do what obama said and let's raise the marginal tax bracket. that'll give you 70 billion a year so how you compensate for the 1.43 trillion less? well let's do what the democrats say and cut the offense in half
and now left with a 1.1 trillion deficit. we're not getting anywhere too fast so. let's take 100% of everything anybody makes over $250,000. well that only gets you about $850 billion, so now we still got a 300 billion dollar deficit. maybe we could ask the people that lost their jobs because of closing all the autodealerships and all the jobs that were are lost because of the interior department and e.p.a. maybe they could pay, i mean receive a little less unemployment check? do you get the idea folks. we got a spending problem not a taxing problem. host: ask him how many employees he has today? your response? >> there's two sides, two pieces that make for deficit and
everyone knows what there are there's spending and revenue. it's up to congress and the white house and that has been there. they have disagreements on how to narrow the deficit. it sounds very simple on one and in terms of math bits very difficult politically because people have are elected leaders have different ideas about how the gap should be closed. host: one viewer on-line saying these politicians work for wall street. who do you think wall street robs when they make money. and now a graduate of the university of missouri. go to atlanta. larry. independent line? caller: thanks for taking my call. my question is, i know we seem to be paying interest payment on the debt that we've got. what is the double-a rating do
for that payment and future payments on just the interest? >> the double-a lower rating could boost up the interest payment. that the united states has to make on it's debt. um... what will determine this. there will be better barometers in the days ahead is when markets reopen tomorrow and there's trading going on there also will be auctions conduct guide u.s. treasury. the market place will give us a good barometer of whether or not those rates in fact are rising. host: another view. when win together or losing to in the "new york times" we need to cut spending in areas on a time schedule that hurts the least. now is the perfect time for a gasoline tax rather than a
payroll tax and we need to use some of the revenues to invest in the pillars of growth with special emphasis on research for risk-takers and start ups. very similar to what the president has been saying time and time again. >> again, the white house has had ideas about how to cut the deficit and also at the same time, try to stimulate the economy to help grow more over the short-term and the long-term and there's different ideas among leaders in congress. they have to coming to. >> tim geithner is stepping down. we're hearing story this want to keep him on board. the republican issuing stachlst about wants him to re-assign immediately.
what's his future? >> it's hard to say. it seems as though from statements that the white house has made that the treasury secretary will be staying. he will, he's one of the key economic officials in the obama administration that's still around. from the begin of an obamas term in office. it's hard to say what the future is. only the white house and treasury secretary know for sure. ho host downgrade is a good thing. perhaps wake-up call to our entire country. seems everyone has ideas on what can help the economy but will work is simple. don't spend more than you make. next is gene. in dublin, virginia.
democrats line. caller: i got a little different spin and would like to find out a reaction on it. when we talk about s&p and moodys. these are is same agencies that were essentially giving good ratings to financial instruments that caused a lot of mortgage crisis and they've been taking a black eye on this all along. i got as someone that does policy work i wonder to myself, how much of this downgrade is real and how much of it is pay back for beating up on the financial community and fair warn. you leave us alone or not. i'm not a conspiracy nut, but it just seems that's what's happened here. especially if it's own one that's doing it. these for same groups that were giving bad ratings, rating securitys for the mortgage
ratings not that long ago. host: also this from nancy this e-mail. a similar question. why should we trust standard & poor's when they were so dismally wrong with the derivatives and edna from texas. what's the difference between the standard & poor's rating and the s&p 500 are they not the same? let's go back to gene. >> there's a number of economies and analysts that believe the united states's fiscal situation did not warrant a downgrade by s&p. and that pointed out that germany and britain, and france enjoy a triple-a credit rating.
these analysts and economy economists. also believe there are issues of credibility. because the rating agencies leading up to the financial crisis did give stellar credit scores to subprime mortgages and derivatives in the end it was found out were of very little if any value and that was key reason why the economy went into deep recession and why there was a financial crisis. host: i jumped the gun on the earlier e-mail but a basic question about standard & poor's. what's the basic difference between this and the s&p 500. >> it's a stock index. s&p 500 has top u.s. companies in it so it's a stock barometer
and it's tells us how stocks are doing. the s&p rating agency looking at the debt side. so one is on stocks and that's thec and p 500 and next the other is looking at debts. all different kinds. host: we're in two wars and the spending is un unavoidable so w need more money so the banks should give tarp money back. >> i'm not sure what the latest number is, but making repayments and the banks are doing that. host: if president obama allows it bush cuts expire, would not not result in more deficit reduction than the oil subsidies and the debt ceiling negotiations? >> if the tax cut expire, there
would be people would be paying higher rates. i'm not sure how much money that would save. and then how much revenue that would generate and how much money they would offset these i there items mentioned. >> let me read to you one line from the new york front page. mid criticism on down grade. s&p fires back in the body of the story. this one point. politicians on both sides using decision the to bolster own ideological decisions. calling to say we're going to hold firm. no new taxes. does that move the ball in resolving the issues. >> some analysts and economists were saying friday this downgrade could actually just increase the political gridlock
in washington and lead to morphine gear pointing and blame game verses moving politicians off the dime to figure out a, longer term plan to reduce the nation's debt. host: keep a close eye on the federal reserve. keeping interest rates l lower than inflation we become negative spenders. >> the federal reserve. ben bernanke faced with a situation that the economy is stuck in a very slow growth rut. and some economists say that because of the recovery that's been around for two years that has not been able to gain a whole lot of traction, some economists believe that the odds
are rising that the u.s. economy could fall back into a recession. given that, the federal reserve is in a position to look around and weigh it's options for how can help the economy grow at a faster pace. >> white house press secretary said administration does not expect a double dip recession. but the former president of harvard and former advisor to president barack obama and bill clinton says it's a one and three per sp percent chance giv double dip recession. >> that's right. what's nearly was unthinkable at the beginning of the year. the odds of the economists are rising because there's been a state of weak economic news. consumers for the first time in number of years actually cut
their spending. the economic growth in this country has slowed to a crawl. manufacturing which has been a bright spot has growth and manufacturing has slowed considerably. in the last month. so, there's a lot of concerns that the recovery is just not gaining the traction and could in fact start backsliding. host: our last call is bill. republican line with jeannine aversa of bloomberg news. caller: i think standard & poor's was short-sided. the reason is because the military industrial complex is going to change direction. i think the president has a vet bill that's going to give an incentive to have jobs a the home and this creates spending domestically and the reason our economy is drain supply and
demand clearly because we've spent money a broad with our military and now that has changed president obama has made wise moves in spending money it looks like he's going to direct more of our nation's funds to be spent at home instead of an agenda that seemed directed to spend it elsewhere and when money leaves our shores that hurts our economy, and the united states now with money spent at home more and maybe making some product that other people wanted to buy overseas will have better economy and standard & poor's didn't take a moment to look at the military industrial complexs and the changes the commander in chief is making there and as a republicans he's wise to tell the jews to return to their 1967 borders. that ought to stop a bit of fighting. host: i don't draw the connection between foreign aid
and your standard & poor's? >> look at the last two wars. host: those are separate from foreign aid accounted for one percent or less of the overall budget. caller: it's still an overall agenda and the way our military is directed as well. this is corrected as it is particularly with the new vet's bill you see the president wanting to employ the vet as the homeworking in civilian jobs instead of fighting israel's war. one final question from marry yan from phoenix, arizona. callaghaning about s caller: i am calling about the tax-exempt establishment from our country.
which there are thousands of and i've heard many times people calling in congress and other places for investigations in some of to the corruption and fraud and president obama used that to start that investigation and nothing has been done and i know there's a lot of money and one of them i believe is cancer very si. these small projects with less money and that's something to be looked into. host: you familiar with this? >> no. ho host report friday from s&p. could we see higher interest rates for consumers and what the tools for the federal reserve. >> it's possible consumers could see higher interest rates. how does the yield on the 10-year treasury note react tomorrow. it's been down and falling on
concerns that the economy is losing steam and it's at 2 point 56 percent. it's low if that were to spike up tomorrow, and continue? there would be a ripple effect through the economy. that's a key rate that's used to peg loans for mortgages and other consumer debts so people would feel an increase in terms of wall street we'll be getting with asian financial markets open that's a cue about possible reaction in the united states stock markets. stocks, investors have been nervous if there's a lot of volatility tomorrow and the market go down, that's going to effect people's 401k's and make them a little less inclined to spend and feel less wealthy in term of the federal reserve they have a number of tools in the
arsenal to stimulate the economy. but the most potent tool it could use is to go out and buy more government bonds. it did so reenforcemently completed a 600 billion dollar bond buying program and that was to stimulate the economy by lowering rates on loans and raising stock prices. the combination of that was supposed to get americans to suspend more to let the economy grow. it's considered right now. a long-shot that the federal reserve on tuesday would actually adopt that tool. it's on the table. the federal reserve chairman said it's open to using it but the economy has to show that the federal reserve would have to fear that the economy is actually going into a recession or that the economy could be headed for a bought of deflation that's a disstabilizing de no,
ma'am nonfor the fed to take that action. host: jeannine aversa following all this on bloomberg news. appreciate your time and perspective. please join us again. at the top of the program we said, conference call taking place tomorrow morning with finance ministers and tim geithner and there's a separate call with deputy ministers to try to get ahead of the story and news from italy that prime minister. saying that he's called on his country and others to tackle this issue on a global level. currently this is something we'll continue to follow today and tomorrow as markets open in a couple of minutes the impact all this has for your 401 k or 403b. your stock portfolio and credit card interest rates and patricia you you joining us in just a couple of minutes and then
marvin kalp. and the book that will be introduce in the moment. brakes a "washington journal" continues on this sunday morning. ♪ >> house of representatives a has been off eight weeks includes this week. on her nightly t.v. show. former russian show and host takes a more irreverent view on washington and thinking outside the box. alyona minkovski. >> trying to figure out how to make t.v. k news exciting and informative rather than, i'm sorry, the garbage it's dwindled down. >> she'll talk about that tonight on c-span's q & a.
>> i'm not for changes the system just so we can feel goodbye having a voter turn-out which may ultimately proximate what they have in australia which is about 97 percent. voter turn-out doesn't mean much in terms of the help of the democracy. some of the most vicious dictatorship get voert turn-out of 95 to 90% when they hold elections. >> vote sag responsible act and for whatever reason i'm informed or uninformed i should not be coerced to make a decision that's life and death for many people. >> monday and tuesday. ralph nader host a series of debates looking at controversial top picks. pros and cons with,aei's institute and fred smith and
professors from georgetown and yuan ver adversityy university of constitution. that's tuesdays at 6 east ten on c-span. >> six, eight, nine. >> eight, nine, seven, six, five, four, three, two, one. zero. [explosion] these for stakes. to make a world in which all of god's children can live. or to go into the dark. we must either love each other or we must die. >> vote for president johnson on november third. >> this weekend we'll look at the history of political campaign adds with robert mann
and former homicide detective on the day jack ruby killed man under his protection lee harveys would and how message where is crafted. american history t.v. on c-span three. get the complete story. "washington journal" continues. >> joining us from new york. patricia paul. good morning and thanks for being with us. >> thanks for having me. host: pressing all the buttons for a panic attack in the new york times the word commonly uses is fear paced on what happened last week. dow thirst day and then friday with the s&p. what's your advice? >> think don't pan sick always good advice. never lead use to a really good decision. this and the reason i think
people are panicking or are very concerned is the memory of 202008 is2008 and we came close to economic collapse. that's not by the slightest measure near what happened 202008. it's ugly and the markets have been brutal for two weeks. and it's worldwide. but i think don't pan sick really the best advice. >> how much influence does standard & poor's have on the market and this credit rating while fish and moodys kept tate sterling rating? >> i think they're in flunlt and they knew that why it was clear when they did the ground rating they did it after the markets and gave us whole weekend to try to digest it. i know there was political work to the administration going back and forth but i think it was clear what impact this would
have on the market. >> we heard many refer to the last and lost decade with japan and now some see if sit facing that economically? is that affair analysis? >> i think the concept of a lost decade is feasible. i think we already did that. if you look at the last 10-years what this economy went through between the.com bubble bursting and the economic fall out. and 9/11 and the economic fall out and massive fall of enron and then the economic crisis of 20200 2008. i think we could argue that investors have had a tremendous impact on pensions and 401ks.
every aspect of society. >> you talk to some people that want to break even with some investments and many- have lost a lot of money you hear the sentiment you can't even get ahead. >> during last 10-years it's been very difficult to get ahead and stay ahead. and you certainly take a lot of knocks but the answer to the last 10-years and the answer to the next 10-years is probably the same, is you have to have diversity. you can't just do a no-brainer kind of investment approach whether i put all my money in s&p index fund and it'll be fine in the long run. i think people have to do a much better job of allocateing a lot of work has been done on past investing leading people to bad results. >> what's your advice as individuals try to imagine personal finances when the savings rate is at a miss a his
low. there's no return on any savings account. what can you do? >> it's tough and i think the first thing you have too do is differentiate between your short-term money and long-term money. your short-term should not be invested. classic mistake people makeover and over. i have another tuition payment due in january and the stock market starts to fall apart and then i'm panicked because i need that money in january. that kind of money belongs in a cash reserve safe secure. i like banks and f dic guarantee on that kind of money. but for your long-term money you have to go beyond and you have to take care of yourself if your ever going to retire you need to participate in things like 401k that maybe your employer sponsors. then you have to participate in
the ira. you are at some point not going to want to work and doing nothing now is not going to be personally helpful to you. >> let's put out a scenario you're a individual that makes $75,000 a year. how much should you be saving and put into retirement fund and typically if you retire at 65 or 68 how much to you need to retire for 20 year? >> okay. little bit tough the way you laid it out. so i'm going to sort of skirt around it a bit. $75,000 person i don't know. one income or two income. there's a lots of factors the younger you are, i think the ez year it is to get starter but most people wait. and the sooner you get started the better off you are. you take a kid just getting out of college. start immediately on your first job putting money away.
you'll never feel it. i would suggest to you. someone that put 10% of their money away over their entire career would never have a problem in retirement. that's a pretty strong statement. it's not that hard. i know most young college graduates are not starting out at 75,000. they might start out at 40,000. a $40,000 living is substantively as 46 thousand but the outcome of that 10% is light years way from somebody that spends everything they make. >> patricia joining us from new york. who do you advise? >> we're a small business advisor. we add vise individuals and trusts and we imagine money. do ma stag ma staging money.
maybe less after this week. we people madnage your money th long-term. i only want your long-term money. we're active money manages and we move. we don't stay with one strategy forever. market conditions and individual conditions change so we move with them. >> the book that you coauthored. creating prosperity? how do you do that? >> you have so to start with yourself. if every dollar you have is being spent you will never get ahead. and many americans, for every dollar they make they're spending $1 and 10 and that a description for disaster. start with your own budget. but once you start there you now
start carving out money that's for your long-term savings and ra y your long-term investments we have 401k. roth iras. you carve out and put it into these vehicles and your lucky your employer may match something. you put a dollar understand maybe your employee is matching 50 per and gives you a boost towards your retirement. you have to pay attention to these. one classic mistake a lot of people make is they take all of their money and put it in company stocks. imagine if you work for apple how tempting it would be to put all of your 401k into a company stock? and the words i say to people when we talk about this is, enron. there was a time when it looked just like apple like there was no top to their market price.
i'm not trying to imply that and sl going to be or doing anything wrong, i'm just saying when you put one stock you can have a disaster effect. make sure you have a diversified portfolio if you go through the last two weeks the mark set down 2% or seven percent in the last week alone but if you go through this. suppose your 401k you had 40% of your 401k invested the stock market. 10% or 40% means you had a 40% decline. perhaps you have a little gold in the portfolio mitigating the damage to get you through these tough times. >> our guest is you patricia
paowell. line for republicans is (202) 737-0001 representative, for democrat, democrat dechlt and we have a line for independent and if you're watching outside the united states. (202) 628-0205. from our twitter page. scott has this point. rather i give you 50,000 dollars in gold or $50,000 in cash? >> that's a very interesting and tough question. being a money manager i would never do all of either. but i certain liam a big fan of cash and i am a small fan of gold at over $1600 an ounce. i was a bigger fan when it was under a thousand dollars an ounce. host: republican line with patricia paowell. good morning dan. caller: thanks for my call. i had a question for terrillier caller but i guess she can field this one too.
how can we trust the stock market when they gave triple-a ratings to pretty much garbage subprime mortgage? can you trust the stock market? people live paycheck to paycheck. how can you 408k when the economy collapsed and everyone had to turn to trim-ple-a but i was garbage. how can you trust it? >> referring to s&p and some of the earlier derivatives. >> i don't think you can. when you make an investment in the stock market, you are at risk and you have to know that going in. you can't say, i'll put in and everything will be okay. the reason that most of us would advise people to have some of the money into the stock mark set that, stocks have weathered
historically, just about every crisis you can imagine. they have recovered from the crash of 29 and world war ii and from the korean war or the cuban missile crisis. think recovered from 911. if you look at this and you say, there is a really strong history of recovery. but that's a large basket of stocks not any individual stocks. not all companies recover. some go out of business so. i'm not a fan of trusting anyone. i'm a fan though of looking carefully at your portfolio. making calculated risks and i tend to like to buy when things cheaper and not more experience expensive so i don't think people should look to the stock market or corporate america and say, i trust you. that's not what is going to work for you. >> our guest earned her mba at
see on the hall university with the market down significantly is it a good time to invest and buy? >> it's always good time to invest. not sure about a good time to buy. i'm not expecting to buy on monday for a lot of my clients. we don't really know how it's going to go. we only have one group of markets open since the downgrade that was the middle east. not sure dubai is a good indicator. but i'm sort of embracing that we might get more of the same. i think it might be a very difficult beginning and difficult week. but i'm not really that concerned. this is not going to cause the world to come apart. it's not good. it's serious but when you look at our economy. we're still growing. we're not in recession yet.
i heard you mention on the last segment that larry summers says the probability of recession he would put it one out of three. i would agree with him. that would mean there's two out of three that we don't go into, into recession and that's good. host: next caller. good morning. caller: hi patricia. i'm from connecticut. two questions. yes or no if you put a significant culprit from wall street behind bars would things turn around and they might think twice about putting world economy in jeopardy next time around? >> i think if you find that someone has done something illegal, then you take the actions that are necessary and you, we have a legal process by which we can put people from
corporate america in jail. it's difficult. you can see even in the enron process there's only been a couple of people that have actually gone to jail over that. but i think you have to look at was anything that happened illegal and if it was, then you have to take action against it and if you did, that would send a tremendous signal that white collar work ers don't like going to jail. >> stock mark set legal iced g legalized gambling. >> i don't agree with that statement but it's legalized risk taking. you have know that the declines can be fast and furious but it's also how we built this country and how we employ the ten office millions of people going to work
every day. and it's through this idea of capitalism. i know your viewers identify themselves as republican, democrat or independent and i, identify myself as capitalist. it's an economic philosophy that has worked this country and built a jawinger that economy and we have had struggles and might be just throwing out the baby with the bath water looking for other alternatives. >> why though over the last 20 years we've seen sum wild swings. the market up or down five or six under hundred. is it unusual or sign of the time? >> wild swings were really a result of i think, the markets and the people investing in the markets disseminating very bad information and i think i said
it earlier in 2008 we came peril obviously close to economic close. the wild days in the market were actually rational. that was a fear that we're dealing with something incredibly serious. the swings today going into this weekend before we hit the c s&p change in rating i would have said we're going to a normal correction. that's happened after markets go for a while. down a little more than 10%. i wasn't exseeively concerned with the downgrade over the weekend but a little more concerned with the weekend. >> why so? >> because i think it's serious. i think they're putting us on
notice that we have some structural issues and i think it actually was rather courageous of s&p to step forward and not cave to political pressure and keep the rating at a triple-a. clearly the easy thing would have been to just find a reason and say, please don't do or make any worse but they said, you didn't lower the deficit by the 4 trillion dollars we said would be necessary to create to maintain this rateing so they withdrew it. i think that was a courageous statement and there's going to be fall out for them as a company. >> the downgrade quote reflects our opinion and s&p that congress and the administration falls short of what would be necessary to stabilize the government's medium term debt dynamics. scott has this point from our twitter page. who believes americans will pay back the 14 and a half trillion
dollars. and of course it's that figure and the debt agreement that stretched out over the past month with the political give and take that led to the decision by s&p on friday. >> i don't think it's the 14.3 trillion dollars. i think it's the expected expansion of the 14.3 trillion dollars if you look at 2010 we spent approximate nightly 412, 413 billion dollars in interest. the first ten months of fiscal 2011 we spent almost the same amount and still have two months to go. it's the expansion of debt and the fear that when interest rates rise, not when but or if but when that we could get a huge explosion of debt services that would make things truly unmanageable. >> john from minnesota. good morning. caller: good morning. how are
you? >> good morning. i'm fine. caller: i reenforcemently retired and all of my nest egg is in a money market with vanguard and i'm thinking about looking at about a third of it to do conservative investment with maybe a five year span on it. what would you suggest? >> okay. i'm sorry if you gave me your age. i didn't quite catch it? >> 65. >> okay. what you have to look at is how long your really going to be retired and how long you're going to need the money and when you're going to need income from this money. what i usually would say to somebody in your position, you have to look at this as at least 20 year money. it might be 25 or 30-year money because you could be here at 90 or 95. not all of us will make it that
far and those that do don't want to run out of money. this has to be long-term money. the pace of spending out of the account will be incredibly important. on some of this money should be segregated saying this money has to be here 10 to 20 years out and that's how you should look at in investing. middle of the road for my office for the last year or so we've been light on equities but not at 0. we've been running at about 30 to 40% of the portfolio being at equities and positions in bonds and also had positions in folds and commodities and i don't see this is differently on the surface for somebody like you. but, if your taking large chunk office money out of this account to maintain the standard of living anything above 4% you have to think and say that money
is not investment money but that money belongs in very, very safe investments and in all honesty if you're in a money market fund and compare and maybe to bank cd's you might do better. might have to go back and forth. >> if you work for a company that doesn't provide a 401k. what advice do you give consumers and what's the difference between that and a root ira? >> a 401k is actually an expense of a profit sharing plan. provision in the tax code. you're talking about the tax code. it allows your viewers offer employees to contribute in pre tax dollars into a retirement plan that's managed through their employers. usually a separate trust. typically you can put quite a bit of money, for most viewers it's a loft money.
16 $500 into a 401k. if your over 50 you can put into the neighborhood of $25,000. if your employer matches that and often they'll match the first five or six percent but you put another six percent jaw could have 25% of your gross income going into a retirement plan so it as really good thing. congress has not elected to be as generous the people that have to do it themselves if you have to, you can do a roth ira that is in after tax dollars. not before tax dollars so you get no immediate max benefit. the beauty of a rothir o is if you immediate the standards your ira is in there for at least five years and your over 59 and
a half you can take all of the money out without incurring any federal income taxes 401k refers the roth ira and that can be incredibly powerful and retirement. your restrictions are much lower though. you can only put $5,000 in. there's income restrictions on that. depending on whether what your filing statuss. filing single or as a married couple and if you reached certain levels you can't do a roth ira. you do get an opportunity to put an extra thousand in for those of us over 50. >> republican line with patricia giving financial advice in uncertain economic times. ann? caller: they can't force you to take the money out with a roth because they have to do the minimum deduction and that hit me when the market was down at a very lowest.
but the business of america is business and we have a man who hates capitalism in the white house. until we get him out of there people are not going to be investing and you look at e.p.a. where he's given a bunch of money. lisa jacks has her foot on the neck of the entrepreneur and took money from the e.p.a. to have rap musicians write a song to get young school children against business. how's people going to have any faith in this stock market when we have a president like that in the white house and we need to get him out of there and steve? can you stop letting democrats like elliot from new york call in on the republican line and the independent line. you're going to lose all credibility with anybody. host: appreciate our call. it's not a perfect system. we do try our best. patricia paowell you want to respond?
>> kind of a hard comment to respond to because it requires more political background than what i represent to have. we go through different kind of philosophies and i think in addition to the political wrangling that's going on in washington, there really is a huge economic argument going on and there's two very different schools of economic thought that are slugging it out. and you have the really took dominance in the great depression and then those that believe more in free markets that were perhaps investing in the prominent member is milton friedman that wrote extensively on the value of capitalism to, and free markets and i think what you see in washington is a tremendous or meant an which is the way to go as a society.
i don't think it's clear which one is going to take dominance. i think the dominance during the crisis of 2008 and it's hard to argue what would happen if - i'm a little more on timistic than you. i think it's been terribly made hard on entrepreneurs and those that create jobs but entrepreneurs are very optimistic and i come from that school saying it's always dawn in america. there's always some guy in a garage trying to figure out how to be the next yahoo and going to create the next 50,000 jobs so i do think it's a struggle, but i am not pessimistic about it. >> ac saying everyone forgot the small saver. most are paying less than one percent interest.
how can we grow money if we're not willing to risk it in the market? >> you can't. you can't grow your money if you're not willing to risk it. what you do with a saving as count is you protect your money and you have to decide what's important to you. if what is important to protect that money and have the security that under no circumstances, that will i have a problem and it'll go down if the bank fails i have lay of insurance in fdic and if that's what's important then you're absolutely in the right place and can't eat your heart out about growth if you're a saver. >> dee from st. louis. good morn together yoing to you. caller: i have a comment. throughout this show, there's been talking about citizens - the population increasing
spending to increase or to improve the economy. at the same time, we're talking about the fact that the average household is spending anywhere between 138 to 110 percent of sco that's just to geby. when we want to start talking about the amount of salary dicrepe energy sis about what is in the average household. we're living off credit. we're not saving because we're trying to get by on you know, what little is being divided between salaries and companies trying to make their stocks look better and more attractive to investors. so or you know, bonuses for c.e.o's and i just don't think that - i think i appreciate the idea of saving and i agree with
i will try to address those of us who have a job. we need to live within our means. what has happened is we have become addicted to debt. we have been enabled to do things with almost unlimited credit. we have to say no to ourselves. what i tell my clients is the first thing you have to do is get the credit cards out of your wallet. they are shocked and horrified. your standard of living will decline when you do this.
if you are not charging starbucks on your credit card and do not have the $4, you are not buying a $4 cup of coffee. you may have to make your own coffee. you will have to refill your water bottle with tap water. take your kids to the library. you may have to take a roommate to make your rent. you may have to share your home to cover your mortgage. these things are not the norm of how people think about their standard of living. they think they could never live like that. sometimes the outcome of not making the cutbacks is you do not have a home anymore. i have literally said to someone that you have to give up your personal trainer and masseuse coming to the house every saturday. they responded they could not do that. where will they go when you are
living in your car? it sounds harsh. i know that. we have to be in control of ourselves. it does us no good to go down this road. we have to spend some time on money management. we have to do it as a family. the kids have to be brought in. kids are a tremendous drain on finances. most children have two phrases "i need" and "i want." as parents, we want to give them everything because we love them so much. we have to learn to say no to them and ourselves. it is hard but true. host: we will go to ed on the independent line from maryland. caller: i have saved my money.
along came mr. bush into office while i was down in the caribbean sailings. he wiped out all of my games. all i have left is my principal. how do we protect ourselves from the idiot politicians playing games with our money and giving it to people who do not produce anything other than a shovel in money around and throwing money away and into their own pockets? guest: i do not know that you can protect yourself from politicians. you see the tremendous debate going on in washington. in many cases, there are heartfelt beliefs of the opposite ends of the spectrum of what government should do. i tend to think the government should do less and we should do more. until that is resolved, i think
you are always going to feel the government is going to take. part of the debate you hear is that we will tax three people -- rich people. at the end of today, that is probably going to happen. you cannot raise enough revenue to cover the kind of deficits we're running by just taxing the rich people. you have to start bringing down the levels. let me give you examples of where governments have done that. in 1986, there was a tremendous debate between ronald reagan and the democrats in washington about raising taxes. eventually, ronald reagan caved in and did not sign the bill for raising taxes. they decided they were going to tax the rich social security recipients. they were talking about millionaires when the debate
started. what we decided was a rich social security recipient was a married couple making $44,000 a year and an individual making $34,000 a year. those are still levels where the tax rates change on social security. recently we changed how we charge seniors premiums on medicare. it used to be that every senior paid the exact same premium. we decided that was unfair. for a single medicare participant, he will start paying more if you have an income of over $85,000 or a married couple with an income of over $170,000. there are all of these additional thresholds. it is very hard to hold the line you are truly trying to raise revenue.
the thing we have to be cautious about when we raise taxes is if we eat our seeds. we can make it hard to grow the economy. we have to grow the economy. host: the next call is on the republican line for patricia powell. caller: social security was a noble program that started off to help with those that were likely going to die before they collected. it blew up after the baby boomers because the next group was not bigger. if you are doing something similar, you would be arrested for running a pyramid scheme. it proves the education system in the last 30 years has turned more to liberal arts and academia -- than academia
because graduates do not know the difference between the fixed mortgage and adjustable mortgage, but they do know why sally has two moms. do these state pension plans have to be a aaa rating? we have been living in fear and insecurity since 9/11. we have been making bad decisions. host: this goes back to the earlier point about the last 10 years after september 11. guest: the caller had so many points, it is almost impossible to address all of them. i will start with the point that is near and dear to my heart. the social security system has
serious systemic problems. the major problem is baby boomers. those are people born between 1946 and 1964. i am one of them. the oldest baby boomers turned 65 in 2011 and injures the medicare system. the oldest baby boomer on january 1 will enter will turn -- change the social security age. there are 78 million of us baby boomers who contributed to the system and contributed the maximum to the system. we have been finding all of what has gone on with the expansion of benefits. they feel just as entitled as a 70-year-old senior in the system today. it is absolutely unsustainable
in my opinion and the opinion of the chief actuary of the system to maintain the system as it currently exists. we have to do something. if we do nothing, we've run tremendous risks we do we run tremendous risks of seeing the same kinds of things in europe and greece. the $412 billion no. i used earlier for deficit spending and interest requirements in 2010 is a very small number. that could explode by interest rates just going up by three percentage points. spain and ireland had the first downgrade. the 10-year bond had a small adjustment. for ireland, it was 0.4% of
boards. the downgrade continue. when it continued, spain was forced to pay two percentage points higher on their debt. ireland was forced to pay 4.5 percentage points higher. that would more than double the cost of interest in our country if we were forced into the same situation. the economic issues we're talking about are very serious and very important. host: dede says risk and peace of mind factors into economic decisions. she says that is why social security is best left out of the market. guest: the proposal to put social security savings in the market came out during the bush should administration.
i think we will have to see in 1015 years if that was the best alternative to have the government put this into a special class of treasurys. they are using all of our contributions to fund the current deficit. the deficit does not include the unfunded liability of the baby boomers hitting the system. it is a very tough area. i encourage all of your viewers to pay close attention. step back from the politics and start reading about the issues. they are incredibly important to all of us. i am not sure this would have turned out to be the best one. we will not know for 10 of 15 years. host: ann joins us from ohio. caller: dee made excellent
points above those who do not have extra capital to invest. i wonder if patricia could talk about what percentage of the population does not have extra capital. she responded by saying we all need to look at our spending habits. that makes sense. a substantial part of our national debt has to do with an unnecessary war and the revenues not raised to pay for it. does she think financial planning causes should be taught starting in the freshman year of high school? a lot of young people do not hear this language at home. i also wanted to ask if she knows about this $2.5 trillion dependence mention that the banks are sitting on. he pundits mention that the banks are sitting on. does she think banks should be
rated by someone else like elizabeth warren? can we create other trading organizations? host: let me get a quick response from patricia powell. guest: there are a lot of questions there. i will hone in on the one i like the best. that is whether personal finance should be taught in high school. i would love to see something like that go on. i want to be sure it is not at the expense of kids learning math, science, and reading. if you have those skills, you can learn personal finance. if you do not have those skills, you will not have much personal finance to manage. host: you can log on to patricia powell's website for more information. one point make is that most americans spend more time planning a vacation in planning for retirement. thank you very much for being with us.
if you checked out yesterday's "washington post," there was a peace on our upcoming guests. deborah and marvin kalb will be joining us in a few minutes. the sunday talk shows can be seen on c-span. the as in the story, stock market, an economy dominated the discussions. -- the s&p story, stock market, and economy dominated the discussions. >> the talk shows begin rearing at noon. beginning at noon, and david gregg. wellcome's -- david gregory welcomes john kerry and john mccain. then, alan greenspan and former white house adviser austan goolsbee. at 1:00, the ranking republican
on the senate budget committee. also, gloria steinem and the u.s. ambassador to syria. fox news sunday rears at 2:00. chris wallace talks with the house budget chairman paul ryan and tim pawlenty. at 3:00, the former republican presidential candidates steve forbes and the former director of the national economic council in the obama administration, larry summers. also, california gov. jerry brown and tom davis. at 4:00, it is "face the nation." bob schieffer talks with david axelrod, howard dean, and lindsey graham. the five network tv talk shows are brought to you as a public
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host: we want to welcome to the table the father and daughter, nation who wrote ""haunting legacy." 1 excerpt struck me about how the war still casts a shadow over the white house deliberations. vietnam refuses to be forgotten. guest: vietnam was the only war the u.s. ever lost. we still are a great power. when a great power loses too small country, it leaves a terrible weight on the mind of the people. officials have to make decisions. presidents have to make decisions.
mindful of blowing network, is doing thee that we're right thing? could we be sending young people off to die for a cause that is meaningless? those of the things that come to mind when you think about the vietnam. host: over the weekend, we saw the helicopter crashed killing 30 people. you ask who will be the last american to die in afghanistan. you also " senator john kerry. guest: that is what he said back in 1971. that is a theme that continues. each president has to make tough decisions that can lead to tragic events like what happened
this weekend with the helicopter crash. host: let's take a recent example of the present dealing with afghanistan. you are right in the book about how this president does not want to hear about vietnam. -- you write about in a book about how this president does not want to hear about vietnam. guest: he was 13 when the war started. it has dogged him. we have a story in chapter 9 where obama goes off to do the obligatory visit to iraq and afghanistan during his presidential campaign. he is there with two senators. it is a 14 hour trip to get to kuwait city and 16 hours to get back. he spends two or three days there. what did they talk about on those plane rides? vietnam.
obama wondered what we could learn from the lessons of vietnam that we could now apply to afghanistan. when he came into office at his first national security meeting, he said he wanted to make sure everyone understood that afghanistan is not the and on. think about it. he is a new president. he does not even have to raise the issue of vietnam, but he does. it literally haunts him. that is the point of the book. this lost war has the power to haunt presidents from gerald ford up to obama. host: what is it like to write a book with your dad? guest: it has been great. my father is a real role model.
guest: the most important thing in life is to have a daughter like debbie. then you can write books. host: what was your approach to the book? how did your research and write it? guest: the book took five years of interviewing hundreds of people, dealing with presidential libraries, going into archives, trying to find out what was going on in the mind of each one of these seven last president's welcome to the issue of vietnam. more generally, we came to the issue of sending young people off to possibly die in conflicts around the world, presidents will ask themselves if we have the right to do this. am i doing the right thing? are we getting sucked into another vietnam. we tried to get into the mind of the president to find out what was on each of their minds when
they have to make critical decisions of this sort. host: you write that the story of the war runs through recent american history affecting every president and raising profound questions about their powers. guest: that is a thing that runs through the book. the other thing in the background is president lyndon johnson who was really undone by vietnam. so many presidents are trying not to be in the situation when johnson where his program was undone by the needs of the vietnam war. he won in a landslide in 1964. he did not even run again in 1968 because of the and on. you see the current situation with president obama with budget
constraints today having to decide about priorities as well. host: the book is "haunting legacy." our guest is marvin kalb and his daughter deborah kalb. john is our next caller. caller: i am a vietnam-year of disabled veteran. i see similarities. the and always paid for. some decisions are parallel. i do not believe the funding problems that obama was faced with coming into the administration -- it takes money to get out of it because of all the unemployed people. there is the revenue problem as
well. i do not mind my check being in jeopardy a little bit. the point is that people cannot do anything about the jobs have to have their families to. you have to have revenue as well as the cuts. it is not just a republican or democratic issue. it is an american issue. host: thank you for the call. let's turn to the defense budget. it is facing $400 billion in cuts. the secretary said anything above that would cut to the bone of military spending. guest: this is something that is going to be haunting us for the rest of the first obama administration. if he has a second, we will consider it then. at this time, obama has created an economic environment in which it will be extremely difficult for him to separate dunnes from bader -- guns from butter.
johnson tried to have both. obama made the same mistake at the beginning of his administration. he believed you could conduct the war's and deal with economic problems. the two are intimately related. our caller is right on. whether you are going to deal with revenue are taxes, the fact of the matter is the economic requirements of today will determine the degree to which we can conduct wars abroad. host: it has been said that we do not fight a war to win. we fight over ideals. guest: the way wars are defined today is different from the way they were decades ago. that is in terms of what constitutes victory. in the wake of vietnam,
presidents do not want to have a specific definition of what it means to win the war. the last half of the book is called "good enough." that is what the obama administration is hoping for with afghanistan, to be able to come out and say we did something that was good enough. it will not be perfect or what you would consider a triumphant victory, but it will be good enough to avoid calling it a loss. guest: when obama was running in 2008, he specifically said it was a war that we have to win. at this point, no one is hearing him talk about victory anymore. now it is a matter of if we can get something good enough, we will take that and go home. host: let me go back to your book and share something bush said in 2001 after 9/11. he said vietnam was a lost war
and not one to serve as an inspiration for post-9/11 conflict. this is what he had to say in october of 2001. >> can you avoid being drawn into a vietnam-like quagmire in afghanistan? >> we learned important lessons in vietnam. perhaps the most important lesson i learned is that you cannot fight a guerrilla war with conventional forces. that is why i have explained we are engaged in a different type of war. we may use conventional forces, but we have to fight on all fronts. people ask me how long this will last. this particular battle front will last as long as it takes to bring al qaeda to justice. it may happen tomorrow. it may happen a month from now.
takey take a your tv -- it may a year or two. we will prevail. i am. -- i am determined to stay the course. we must do so. host: that was 10 years ago. guest: it has been 10 years the u.s. has been involved in afghanistan. it is interesting the way he was talking about it. the cloud layer issue continues to come back. -- the quagmire issue continues to come back. it is associated with vietnam. on afterontinue to gola vietnam fades from most people's minds. i think will be a question of shorthand words that will bring people back to weather is like
vietnam and whether we can avoid it and out looks similar to vietnam. host: every president looks at his predecessor. he wrote that bush thought that clinton had small vision and considered himself to be president of a large strategic play. guest: george w. bush had the horrible advantage of being the 9/11 president. dick cheney told us when we interviewed him that 9/11 changed everything. all plans were thrown out the window. we were going to do things in an entirely new way. president bush speaks about conventional war. he implies we're also going to fight a guerrilla war. he said we will do anything to win. he said this could go on for a year or two. it has gone on now for 10 years.
the nature of the war we fight today is so uncertain that bush looking back at clinton would say anything but clinton. they have in mind that clinton would never have boots on the ground, did not want to go to work, was terrified by the ghosts of vietnam. the bush people post-9/11 said we're brave and appointed take the action we have to do. president bush also said where clinton did not want boots on the ground, he wanted boots on the ground. that became his motif. host: bill is joining us from
illinois on the democrats' line with deborah and marvin kalb. caller: america did not lose the war in vietnam. i want to make that clear. i was in a special support unit for units in trouble. i was a sniper. i am a 100% disabled vietnam vet. we had all of our borders under control in vietnam. we have everything under control. i want to make that clear. the vietnam army lost the war. host: hold on. we will give marvin a chance to respond and then come back to you. guest: people who were in the war and paid the price, those people look around at what they did and do not believe they lost the war. they did not. i want to be clear about that. however, the united states lost
the war. with the mistakes are the president's -- whether it was the president, the army, the pentagon with the wrong strategy, congress pulling funding for the war, whatever was, the package was the united states of america. that package lost. there is no way of looking at the vietnam war memorial commemorating the loss of 50,000 americans without saying this was a war that the united states and america lost. i do not say that with any pride. it is just a fact. guest: i agree. it is an issue that has come up continuously as we have made both appearances. i understand people who served in the war would feel that way. it is completely understandable. host: bill, please go
ahead. caller: iraq and pakistan will be just like our vietnam. their military cannot support or they're in. they do not have the desire. they have the corruption. you will see iraq and pakistan will fall. it is just like vietnam. if the military does not have the desire for freedom and the devotion for freedom, it will fall. guest: it is a logical point. we can look at what is going on in afghanistan, the relationship to pakistan, and said that pakistan will collapse. iraq will collapse when we pull out completely. yes, that is possible. it does not have to be that way. there is smart policy that can be applied to keep these countries from falling apart.
with iraq, we have to be mindful of the possibility that we have done their so far will create a good enough situation such as what we might wish for in afghanistan as well. host: one person said vietnam was a sham. guest: it was not a sham. i was a reporter covering the war. my brother was there a lot. nothing was a sham. what we read in was a terribly complicated the real war -- guerrilla war that the enemy would fight as a guerrilla war and a conventional war. it was both kinds of work. it was an odd hybrid military strategy. the north vietnamese used that
to their advantage and onwon. host: he said it was a sham and based on lies. guest: that is different. i understand what he means and sympathize with him. the american people are ultimately the ones who will pay the price. it is not just tax money. it is the allies. the kids who died in the helicopter in afghanistan this weekend, that is enough to break your heart. what did they die for? that is a very important question. if they died so that karzai remains in power with the corruption, that does seem to be a terribly good idea. host: our next caller joins us from missouri. caller: i hearken back to world war ii when congress declared
war. fast forward to 9/11 and we have the war powers act. congress never does declare war. what would have happened if congress had declared war in korea, vietnam, any of the subsequent battles? why does congress not do that? why do they always default to the war powers act so that the president can take the blame for what happens? host: that goes back to the earlier point where you write about the president's prerogative and powers. guest: it goes back to vietnam and towards the end of the war. congress wanted more of a say over policy. writthe war powers act has continued to play a role. is playing a role right now with
the situation in libya. congress wants more of the same. the administration is saying we're defining our action there any particular way -- in a particular way. it gives in to the nuances of the definitions. both sides have been wrangling over that for a while with the situation goes right back to vietnam again. guest: we have to remember we have never had a declaration of war, but we have fought many wars since world war ii. career, vietnam, all the others. lyndon johnson said something very smart back when he was senate majority leader in the late 1950's. he said if you ever go to war, minimally fit resolution of congress. the congress behind the presidents of the american people are in it together. one of the negatives we learned
to the vietnam experience was that when you begin to lose the people, you have lost it. host: oscar said they have died for greed. the american people are conditioned to accept anything lying down. guest: i hope the caller is dead wrong about that. i hope the american people will not take anything lying down. with programs of this sort, the internet, and the world in which we live today, a think the american people know a great deal. at a certain point, they're going to wake up. i have enormous confidence in the american people making the right decision. i am aware that every now and then you go through a terrible
time which almost discourages the american people from having any faith in the efficacy of their government. i understand that. i feel the same way. at the same time, we cannot assume that is the wave is going to be. there are ways of changing it. the american people are perfectly capable of changing. we're going to have an election next year. we will see. i was only in vietnam twice briefly. bernie was the war correspondent. he was there a long time, years. caller: i appreciate these guests bringing up some of these issues. the white elephant in the room that no one wants to talk about is the draft. i was there to protest the war.
it started as a protest for the kids to maintain their status. if the politicians kids have to go to work, then we will have a discussion and the american people will be involved. if president obama's daughters had to serve, things would turn out a lot better. guest: the caller makes an interesting point. the draft was a major motivating factor behind all the protests going on during the war. the fact there is no draft today makes the climate incredibly different in terms of the war in iraq and afghanistan. if there were a draft today, there would be protests all over the place. there would be a whole different climate. politicians would be paying more attention in that way because they would be hearing more from their constituents. host: scott says his dad was in the war. the democrats did not want us to win.
they wanted us to leave. guest: i am sure many democrats wanted us to leave. the implication is that the democrats wanted us to lose. i find that totally wrong. lyndon johnson was president at the time. johnson was the one who said when he first took over from kennedy that he did not want to be the first american president to lose a war. he did not want to lose the war. the problem was that at the time of tet, there was the appearance of the north vietnamese winning the war. they have to turn that around. -- they had to turn that around. the american and south east military inflicted huge losses on the communist forces. but the appearance in the american mind, the television images suggested an american laws. host: in the book, you right after vietnam, no american
president could tolerate another defeat. certainly not a democrat or obama who had never served in the military. afghanistan was the war american -- america had to fight and win. guest: democratic presidents going back to truman had been concerned they will be accused of losing one of the country it might be. obama could be accused of losing afghanistan if things do not resolve in a good enough answer. host: "haunting legacy" is the book. good morning, craig. caller: as a vietnam veteran, my comment is in general the left wants to use the vietnam war as a bludgeon against other people in the country.
they misunderstand. the vietnam war was not a small war. it was a small action in the war with the soviet union. ultimately, the war was lost. the reason we have to lose in vietnam was because they lost the backing of the people of the united states in large part because of the anti-war movement. the ultimate enemy at the time was the soviet union. since there is no more soviet union, the continued reference to the loss is wrong. guest: the reference to the loss is because we did not win it. we lost. the point he is making is profoundly interesting. the united states was involved with the soviet union in a cold war with nuclear weapons in the background.
it was a terrible, frightening kind of experience. the united states won that war, the big war. there was no question about that. the soviet union collapsed. we won that, big time. within that large struggle, there were a lot of small wars. vietnam was one. that was one where we did not win. that is quite interesting for historians to look back on. we won the war against the soviet union but lost in vietnam. how is that possible? historians will deal with that and the issues he raised. thank you for that. host: how did the powell doctrine affect things? guest: that is a military doctrine that emerged in the 1980's. it came into effect with
president george h. w. bush when we went into the persian gulf to leave it iraq from kuwait in 1990 and 1991. the powell doctrine was started by a man pal worked for under president reagan. -- powell worked for under president reagan. that was caspar weinberger. he went through the experience of vietnam and asked what we learned. he came up with three or four principles. if you want to go to war, have congressional support and public backing. if you want to go to work, go in with overwhelming force. do not mess around with small units. if you want to go to work, go to war on the timetable of your choosing. if you want to go to war, have a way of getting out and know how
you are going to get out. powell took these ideas and played around with them for several years. he formulated them. he was surprised, he told us, that it turned into a doctrine that people talk about now. it encapsulates all the problems that go through the mind of a president when he that we'rehen he has to say going to war. that is the powell doctrine. it is still around. it is in broad terms rather than specific terms. host: good morning, stephanie. caller: you talk about the american people waking up. the american people before the iraq war were told by the media we must go into this war. there was a resolution in
congress. it was like groupthink. dia and during this, they thought it was the right thing to do. if the media is not completely independent, will the american people wake up? guest: that is a very interesting point. i think the mindset of many people in this country was to rally behind the president and leadership after 9/11 and go along with what they were proposing. i do not think that is necessarily the ones that today. but that was the mind-set at that point. people were more willing to give leeway and credence to what was being said. in terms of the media, it has its issues and flaws.
i think it is still an independent entity and not just some government propaganda tool. immediate navy was not as critical as it could have been in questioning assumptions made before the iraq war. -- maybe the media was not as critical as it could have been in questioning assumptions made before iraq war, but i think it is independent. host: jim says we were not there to save anyone from tierney. guest: we will have to have a conversation about this. this will take longer than a minute or two. we were in vietnam not because we were seeking bases or wanted trade in the pacific. we were there because we were in the cold war with the soviet union. we did not want another country
to fall to communism. we saw what happened in eastern europe after world war ii. we did not want all the aged to go china -- communist simply because china went communist in 1949. we made profound mistakes in the way we went into vietnam. we slipped in. nobody even knew it until it was too late, until the casualties began to mount. in 1968, we were losing 500 americans a week. then the american people woke up. their sons and daughters were being killed. then we realized it. the idea we went in years before to get a basin is simply not true. host: south carolina is on the phone. we're talking about the book "haunting legacy."
good morning, kenny. caller: my question is why when the united states realized they went to war for the wrong reasons in a rocket was a mistake, why did we still fight the war -- why when the united states realize we went to war in iraq for the wrong reasons, why did we still fight the war? guest: one of the themes in the book is that a president is faced with the decisions that perhaps were made by a predecessor to enter a particular war. that was the case with vietnam. it was inherited from one president to the next. iraq was inherited by president obama from president bush. when you are in that situation, presidents have to think about how to get out. do you get out gradually or all
of a sudden? how do you deal politically? presidents have a lot of political concerns. you do not want the accused of losing a particular country. you want to end up in the situation of getting out when you consider the situation is good enough. that is what is going on today. host: one of our viewers says the usa is not just fighting iraq and afghanistan, we're fighting countries supplying arms. we're fighting the diplomatic policies of u.s. politicians. guest: i am not sure i understand what that means exactly. host: iran plays a big role in the middle east, in afghanistan. guest: i am not one who believes the sale of arms determines policy. we still have an idealistic streak that allows the american government to believe on
occasion that we can do something and make the world a better place. maybe this is terribly naive, but i think the united states of america still is exceptional in certain ways. we can do things no other country can do. that is because we are powerful and have the ability to create wealth. right now, we're not proving that on a day-to-day basis. that is going to be terribly important politically and militarily for the u.s., but it is an issue i think the american people should address. kenny, you are in columbia, south carolina. my other daughter lives there. host: how many doctors do you have? -- how many daughters do you have?
guest: just two. host: brian joins us now. caller: i was born in the seat and worked in war planning in the marine corps. -- i was born in d.c. and work in war planning in the marine corps. this started with eisenhower. ho chi minh tried to be harry truman's friends. no one knows american history. i guess they cannot read. in vietnam, we did have tet. i do like mr. kalb. his daughter seems to be just like him. the media did turn on us. this was my generation. my brother was also in the marines. if you do not have the nation behind you, forget it.
host: we are short on time. deborah? guest: i appreciate his comments. i think they are heartfelt. his last comment is true. if the president does not have the public behind him, he is not going to succeed in the military efforts. that goes back to the powell doctrine as well. host: rick joins us from knoxville, tenn.. guest: i wanted to ask if they are familiar with the book, "the choice. " it is about why we got into vietnam in the first place. what was proposed in the book is the fact that it was about economic control of the southeast asian rim. it was about controlling the
markets and escalated beyond anyone's control because of the subterfuge of the senatorial office holders. that ended up getting us into a position where kennedy got maneuvered into that position. guest: we dealt with this a couple of questions ago. i do not believe we got into vietnam for economic reasons. there was no economic reason that would propel the united states to go to war in vietnam. we went to war in vietnam because of a number of strategic errors made by a succession of presidents. it is unfortunate. people are constantly seeking conspiratorial rea w