>> from our studios in new york city, this is "charlie rose." >> paul krugman is here, a nobel laureate in economics and "new york times columnist and professor at princeton. he had been one of president obama's most vocal critics during his first term, and has

changed his tune. a cover story in "rolling stone," "in defense of obama," calling him one of the most consequential and successful presidents in american history. i want to talk about this, why you believe as you do, and how your feelings may have evolved. first, where are we today? i just watched what happened in washington in terms of global forecasts from the imf. they talk about a slowdown and recovery that is mediocre. they look at europe and china. the u.s. was reasonably healthy. >> right. the u.s. has been looking pretty good, not a roaring boom by any means. there are troubles. europe is scary.

china is scary, though that is harder to track. we are not an island. you would really not expect the u.s. to be completely immune to these developments. here we are, six years, still very fragile. >> talk about europe first. what is the problem in europe? >> it was originally that there is trouble in the debtor countries and a very strong germany. now the problem is, after years of being worried about the wrong thing, too worried about debt and inflation, now they look around and discover they have turned into japan without the social cohesion. inflation is practically zero. essentially deflationary already.

germany is slowing down sharply because it depends upon exports, and who will it export to? and it is just, it is -- they don't have, the scary thing is they don't have tools. the european central bank, mario draghi. a good man, smart guy running the ecb, but only so much he can do. fiscal tools are hard because there is no common government. the germans are not ready to change their tune. by the time everybody wakes up to the gravity of the situation, europe might be stuck in a deep depression with god knows what political consequences. >> pressure from the right? >> anti-immigrant groups, extreme nationalist groups. we say, what if marine le pen becomes president of france? you say that's not going to happen, but if you believe the polls --

>> what would happen? >> if the election were held today, it would be possible. the u.k., britain, the golden dawn in greece, separatists in northern italy. there is a lot simmering, because year after year that is what failure does. >> it creates people who have nationalistic pride and use the economy as the reason why everybody is angry and suffering. >> and the elite in europe has discredited itself. europe has always been a thing where the people who know have been more or less imposing the vision on the public without a lot of popular support. the european idea has never been as deeply rooted among the general public as it is among the european elite. the elite has to show it is competent. everything in the last six years says it is not, so of course the radical groups will gain power.

>> russia -- oil prices are declining. they are dependent on the energy. >> russia is a petrol state. it is in fact not a big economy. its direct rol is not that big. they are sort of a weak economy with nukes. exactly what you think about that, i don't know. >> what has happened in china? >> china, we've been waiting. we know, china has to change. china has been an economy that has bizarrely high levels of saving and investment and very low consumption. that can only go on so long. china at some point has to hit the moment where it has to change 20% of gdp from industry to consumption. they keep putting up that moment, and now they are kind of hitting the wall. >> i know you are an economist,

not a stock market analyst. >> very much. >> but having said that, is this, all the things we talked about, the reason the stock market went down so dramatically today? >> god knows. it was famously said the stock market has forecast nine of the last five recessions. it's a general sense of jitters. the bond market is more interesting. that's a clearer thing. 10-year interest rates dropped below 2%. the bond market is signaling it thinks europe will be a depressed economy, a depressed world economy for a long time. >> what is a long time? >> five-year implied inflation forecasts, they say five more years of depression. certainly, the idea we will normalize, interest rates go up next year and everything will

return by 2018 to the way the world was in 2007, the market doesn't believe that anymore, and neither do i. >> suppose they say, professor krugman, we hear you. we want to create a growth economy. we want to create demand. what do we do? >> if we can wave aside politics, what would you want to do? last time we had anything like this was in the 1930's. how did we get out of that? we had a very large fiscal stimulus, otherwise known as world war ii, accommodative monetary policy so there was a 60% rise in prices during the war eroded real value of debt, and a long period after that of low interest rates and inflation which worked down debt levels.

if you had to say, what would a textbook solution would be? a big infrastructure program. construction. a big infrastructure program. very aggressive monetary policy. lots more quantitative easing, raise the inflation target for the next decade. basically create an economy were sitting on your cash is a very bad deal and investing looks like a very good deal. >> that is true to both the public and private sectors? >> that's right. we don't control the private sector directly. right now we are in a world where more public spending would actually crowd private investment in, not out. holding private investment back is not the cost of funds, but the lack of demands. if we had more government spending, if we did lots of infrastructure, especially in extra tunnel under the hudson

river for my commute, we would have more private investment as well and things would be a lot better. so all you have to do is get house republicans and the germans to agree we need a lot more public spending. >> but there is also a question with respect to housing, which created the last recession. what is happening in housing? >> housing is interesting. first of all, you don't have to fill a flat tire through the hole. just because housing is where we lost it doesn't mean -- >> well said. >> also, the thing is we have built very few houses for now eight years. since the bubble burst in 2006, so we're kind of under-housed. why isn't there a roaring demand? lousy job markets. all these 25, 29-year-olds are staying with their parents. there is a virtuous circle. if we have an economy producing more jobs, they would be more demand for housing, which produces more jobs. some of that is happening, but a

real boom would create all of that. if anything, a miniature version of the housing boom. another boom as we make up for lost ground. >> having said everything you just said, why isn't your argument, this guy has been in charge of the u.s. economy and you are here praising him, saying he is a great president, and you just said our economy is not that great? the bully pulpit? >> he had only two years when he could pass legislation. i prefer the green lantern theory. by force of will, he could make the republicans cooperate -- he can't. all these things, i talked to people in the white house who would say, we do a trillion dollar investment program, but nothing like that is feasible. so we can't do that.

>> if they could have gotten that through a republican house they would be able to stimulate the economy so it would be in much better shape, perhaps growing 4%? >> yeah. back when i was critical of obama in 2009, i thought he had a window when he did control congress, though it was difficult to get things through the senate even then, when that was the time to be super aggressive, and they were not. that window has closed. >> but leadership is about being able to get things done by getting people to come around to your point of view, or to have them see their own interest so that you are able to do something. that is the definition. >> just look at what the republican base is like. this idea that somehow it is obama's fault.

>> can you give him a pass because of his republican house opposition? ok, you tried, therefore we are going to call you a great president? >> what i'm calling him a great president or is other stuff. above all, health reform. and health reform, i don't think "joe biden on air, but it is a big deal. if you are somebody of my political leanings, i am a free market keynesian progressive -- >> we love this word "progressive" don't we? >> there is a difference between the realism and progressivism. liberals, progressives, whatever, have wanted a national guaranty of health insurance, have been fighting for it for 70 years. >> instrument? >> some wanted fdr to put it in social security. it certainly began with truman. it failed under clinton, and now we have it.

it is not the -- it has complexities, but it is working better than expected. costs are below expectations, enrollment is above expectations. >> do you believe the public perceives it that way? >> no. by construction, the affordable care act leaves most people unaffected. if you have good insurance, you pretty much get to keep it. >> a lot of people say -- >> it turns out it was only a small number, and what actually you could not keep was skimpy policies that did not meet the standards. if you have insurance through your employer, it is the same. most people are not affected. it is run through state-level exchanges, so many people do not even realize it is a federal program. the other day mitch mcconnell

did a word salad in his debate where he tried to blur the issues, saying people can keep the kentucky version even if they repeal obamacare. it is part of obamacare, but people don't know that. even liberals are not aware of how well the first year went. the news media has done a pretty bad job. they are not aware how many people signed up. they are not aware that insurance premiums came in 15% below projections. that has not gotten a lot of play. >> and protection of people who did not have insurance. >> we think it is about 10 million. we will not have that for a while, but about 10 million people previously shut out of the insurance market are now in. it is likely something similar will happen next year. >> this is not the place for another discussion about obamacare. but does it hurt small businesses? >> no. >> they have allowed megaphone. the perception is yes. >> a lot of them were helped. i know people running small

businesses who were finally able to get employees health coverage. >> is that a majority, or a minority? are there more people who had a plan that was working and the regulations make it unbearable? >> very few. the number of plans actually working for people that got canceled was very small. there were political reasons why that is played up, but, here in new york, in new york that did not happen at all because new york had -- bad plans were basically not allowed in new york, which meant lots of people had nothing at all. if it were not a stick that republicans wanted to use to beat up the president, this would be reported as a really startling policy success, but the public does not see that. >> does that mean obama is a

great president? >> i think it is the primary reason. this is a defining achievement. but other things, financial reform, is much better than people think. a lot of people think that because no wall street people went to jail, which i regret, too, that nothing was done. which is not true. that's serious, but i would have liked to see some people sent to jail to encourage the others. looking forward in terms of legacy, what we have now is much more effective regulation of large financial institutions. we have serious consumer protection, which we did not have at all before. that's not nearly as big a deal as health care, but people talk as if nothing was done, and it

is better than people realize. >> did you read leon panetta's book? >> i'm not a cheerleader for obama foreign policy. as a national security president, i don't think anyone would consider him great. he's pretty much a normal post-vietnam national security president, somebody does go out and bomb people. bush with somebody who actively wanted a war, and was looking for an excuse for it. so obama's return to normality on that, which considering the alternative is a good thing. >> i heard you say the economy is not as good as it should be. he's not doing so good on foreign policy. the one thing you cite as health care, and nothing else? >> ipad mini economy is not great, but not afraid to the stimulus. integrate him on a curve, he is

pretty good. >> doing well compared to what? >> take your list of presidents. >> we will not compare him to fdr or washington. >> there is lbj, who gave us medicare and medicaid. and vietnam to request vietnam was there. but he did not know how to handle it. let me do the reagan comparison, trying to move the country in the opposite direction from where i wanted it to go. he is touted as a great president. but in fact, he wasn't. that's the amazing thing. if you are somebody who wanted to see the u.s. welfare state unraveled, wanted to see a radically smaller government, reagan did not deliver that. he left the structure pretty much the way it was. obama, on the other hand, has

left it with health care is essentially a right of legal residence of the united states. so obama achieved a permanent transformation of america in a way that reagan did not. by my analysis, that makes obama a more important president in the end then reagan. >> there is also this, the mention of financial reform. there are those who say we have fewer financial institutions, we still have too big to fail, and 2008 could happen again.

>> it could, although -- >> that reform was not enough to stop it. >> there are two things. one, we didn't end too big to fail, but we created a system where institutions that are too big to fail can be subject to discipline. we now have mechanisms. there was a very good case for temporarily seizing citigroup and bank of america, but it was not clear that the legal authority was there. now it is. if there is another crisis, we have much stronger tools. >> at the time bernanke did not believe there was legal authority. whether they were right or wrong. >> we now have a structure that

would make it possible to have a much better response. a lot depends. if the next financial crisis happens with president cruz and rand paul as treasury secretary -- the tools are there for the administration to do a much better job. >> not perfect, but better tools. >> even when fdr did social security, it only covered half the workforce. he did not include health care, which upset a lot of people. presidents who appear in the rearview mirror to have been great and transformative, even if they were, often appear to have done only half the job when they were in office. so when you say, we have not and everything we wanted for a while, but we have gotten a lot more than from anybody since lbj, and that makes him a big deal. >> what you think of this lawsuit in washington, in which hank greenberg is suing?

>> unbelievable. there is no proper english word. we are getting a lot of information. i would be shocked if he can extract any money, but i'm glad it is happening. >> you are leaving princeton at the end of this year. >> i'm retiring from princeton. i'm in my 60's, i'm retiring from princeton and taking a position at the cuny graduate center in new york. >> you will continue to write your column and lecture around the world? >> as far as i know. yeah. >> paul krugman. back in a moment. stay with us. ♪ >> bernard-henri levy is here. he is a philosopher, and author, and my friend. his latest piece is "shame on turkey for choosing the islamic state over the kurds."

there is only one way to save what is left of kobani, and that is turkey. he has also taken a strong position against vladimir putin. his new play is a one-man show starring a fictional version of him, investigating challenges facing the european project. i'm pleased to have bernard-henri levy back at the table. welcome. let's talk about kobani. how do you see this? >> kobani is a shame. in kobani you have great people, men and women defending their families, their city, their homes. and you have this terrible it islamic state giving the assault against kobani. and turkey closes its border. with tanks on the other side. with volunteers who are ready to come and defend kobani. and turkey closes the border.

turkey is a member of nato, as you know. a member of a military alliance. so for me, 10 years ago at this table i came and told you there was a problem with pakistani alliance, the american alliance with pakistan. it proved not wrong. today i say there is a real problem with the turkey alliance. if kobani falls, turkey will no longer have to be considered as a reliable ally. and we should pose the question of the blogging of turkey to nato. >> the interesting thing about it, being right up against human catastrophe, which may very well happen, you have a nation putting conditions on per dissipation. you have to make a pledge

against assad. you have to put a no-fly zone here before we will participate, and isis is knocking on the door of kobani. >> of course, any way it is a very conjugated story. it is true, as president obama said, that it is the most contradictory situation possible. but for the moment, what we know is that in the front lines of the fight against the islamic state, there is the valiant kurdish people. they are in the front line. they are fighting for us. their freedom is our freedom. if they are saved, we are saved. all those beheaded, poor guys, heroes, the kurdish people are fighting for their memories. and our ally, turkey, is blocking the border. >> why are they doing it? >> they're doing it because mr. erdogan, who is a crazy man, has this obsession of free

kurdistan. between free kurdistan and death, he chooses death. he plays with fire. he makes the choice of islamic state against free kurdistan. what we know is that kurdistan is probably the very model, the very example of moderate islam. secular, preaching equality between women and men, which we are looking for everywhere -- it is here. this moderate islam is incarnated by this kurdish resistance.

for mr. erdogan, this is probably a danger. >> do you think iraq will remain unified state, or will it break into kurdistan and unified sunni and shia states? >> there is a possibility it breaks, but also a possibility of great diplomacy led by america, which would consist in saying to the kurds, we help you in a consistent way, in a solid way, but one condition is you maintain the regional balance. that you do not break the borders. this is the deal which america and europe could do. we come to your rescue, we save kobani, we save your families and your homes, but we do not touch the borders in the area. but let's try. obama, hollande, european union, america -- i don't know.

we need for that imagination and courage. >> you also need troops on the ground, and nobody seems willing to provide the troops. in iraq you worry whether the iraqi army is compared to do it. >> the troops you have to day is kurds. male and female. >> is that enough? >> if we gave weapons to these women and men soldiers, if we gave real weapons, it might be enough. >> let me talk about -- first of all, we will get to ukraine and russia in a minute. libya. you went to libya, and it seems now people look to libya as a failure. >> remember the sentence of one of the prime minister's of mao zedong. he was asked, what you think of

the french revolution? he said, it is a little early to say. two centuries after. so three years after the libyan revolution, it is still a little early to call it a failure. , for me what i fear is you have to compare what is happening in libya with what is happening in syria. what is the result of nonintervention, and what is the result of intervention? the result of intervention in libya is chaos. the result of nonintervention in syria is chaos plus 200,000 dead plus islamic state. >> chaos on either side. >> plus 200,000 dead on the side of nonintervention. the result of intervention is better. >> you have a column i referenced in which you called

for a marshall plan for ukraine. what is that? >> i call it a marshall plan. organized by a man with people from germany, banks, industry. i proposed an economic rebuilding of ukraine. number one, world economic forum held in kiev, devoted to ukraine. number two, state issue of bonds by ukraine with the guarantee of imf. >> talking to investors, not philanthropists. >> and the federal reserve, the european bank, and the imf could, if we really want ukraine to come to europe, if we really believe in the message of the maidan, which is the case of mr. holland, mr. obama. mr. obama seems to believe

poroshenko a sincere when he says he wants to go out of the hands of putin and into europe, then we have to pay the price. why doesn't the imf, thank of europe, federal reserve, give signature to the issue of bonds? this is the proposal i gave to the symposium. >> finally, you were making a play in paris. >> i wanted to speak about the fall of europe, like the fall of the roman empire. i'm sad to say, my feeling is we might be facing the fall of europe. no common economic policy, no common foreign policy.

look at ukraine. the english are concerned about banks. france is concerned about the mistral. germans are concerned about the gas. this is one symptom of the fall of europe. this great dream. i was bred by this dream of a unified europe, a reliable partner of america. this dream is collapsing. so i wrote this play to warn, to make a wake-up call to my fellow citizens of europe on what is happening today. >> the play is about you preparing for a speech, right before world war i? >> it is supposed to be, the fiction is me in sarajevo. >> what time? >> on the day of the one century anniversary of world war i.

he's supposed to deliver a speech on europe, a big speech. he's in a little room in sarajevo, and he's a man who speaks easily, for the first time he's prevented. the speech does not come. all the threads are broken. all the architecture in which he believed so much all his life, he sees a collapsing in front of his eyes. at the same time, he becomes mad and finds the solution. he has the vision of the solution for europe tomorrow. this is the end of the play.

>> great to see you. >> great to see you back. >> if you are in paris, the play ♪

>> massimo bottura is here. italy's most talk about chef. osteria francescana is ranked third in the world. he is famous for advancing traditional italian recipes. his new book "never trust a skinny italian chef." here's a look -- >> i grew up in the land of fast cars and food. i learned when i was a kid to think very quickly. as the romans would say, "think it quick, but do it slow." have a very quick thought, but think it slow. they interpret what i'm thinking, they know what i'm

thinking. so here we go. >> that's very nice. a nice promotion for the book. why the title. because you're skinny? >> the title came up in a trip to los angeles, 2001. we went, friends invited us to a dinner. we alked into the kitchen and it was a big display, never trust a skinny italian chef. we laughed. why don't they trust me? i'm a skinny italian chef. i was like, i'll do my best to have everyone trust me. the ironic way to take distance, stay always grounded.

irony is important. to laugh about yourself. we are cooks. >> why did you decide to write this book? >> why? because my colleagues, the great colleagues, the people i respect the most, they were pushing me. come on, sign the contract. when you talk at conferences people, you influence people. so i said, ok, i will write a book. then step-by-step with my wife, we were trying to put down ideas. one after the other. in the book, the story of my 28 years of career. >> you pay to be to a french chef, a spanish chef, and an italian mother. your mother. [laughter]

>> i know. in this, i compress all my gastronomic life. pasta and beans is the most popular plate you can have. pasta with bean sauce, and my mom was always telling me about putting parmigiano crust into the beans. i compressed this gastronomic life into a glass. the french, royale. cheeseburger, royale with cheese. just like pig skin, greens, a little foie gras. and these things that remind you, the flavor that comes from the past, the memory, the

country. then at one point i finish the glass with the air of rosemary. here, air of rosemary, something that disappears in one second. in the middle, instead of pasta, i put parmigiano crust, sliced thin as if it was pasta. >> is she responsible for you becoming a chef? >> she is. she is the one who always was pushing me to do things, to follow my passion, not to listen to anyone, to trust myself.

>> i assume there is an easy answer, but why not rome? >> because it's not about the place you are. it's about who you are, what you have to express. you know, i felt so comfortable in modena. modena is the town of slow food and fast car. the place where maserati, ducati are built. people come from around the world to meet mr. ferrari, to buy a maserati. why do they come if i have the right idea, to eat at osteria francescana? so we decided to open there. it was cheap, we had enough for what we had to do. the land of parmigiano, balsamic

vinegar. then i drink too much lambrusco. >> what is that expression, avia pervia? >> make simple the difficult things. >> that is the life story. >> make it look simple. even a plate, like how to burn a sardine in three days. it is a complicated expression, how to cook the perfect sardine. it is the most simple thing, that sardine, tastes heaven. it makes simple. i don't care about, show how great we are. this is content break was in. it is no more about fireworks or magicians playing to show we can take some rabbit out of a hat. it is about, put the attic close

to the static. >> the attic close to the static? >> i'm so close to my artisans, farmers, cheesemakers. they deliver fantastic ingredients to my restaurant that i use to transfer emotion. >> transfer emotion? >> i think the book is about that. >> transfer emotion? >> yeah. when you chew a parmigiano crust, it's emotion. i see people crying, eating the potato truffle.

it's like, so emotional. >> at what point did you go to work in ibuli? >> it was 2000. >> how did you get a job? >> he came to my restaurant. he can to my restaurant, he callled -- called me to the table, said, want to come? next season. i said yes. >> why did you say yes? >> i was on track to understand new techniques coming out. 2000, so not like now. i was really into crazy new techniques that were changing the perspective. but actually when i arrived there, i realized it was not about technique. it was about freedom of

expressing yourself. in that moment, i understood that a great chef can express himself with a potato or a parmigiano crust, not just caviar or lobster. >> here's a conversation i did with him at this table. he talked about the chefs who have contributed. >> when you look at all the people, that today are the most influential cooks in the world, the spirit, ethics, honesty, sharing, liberty, freedom, risk,

passion. in any kind of business, it's the dream that the whole team would have such, these businesses were created by all the people who pass through. lots of young chefs have this philosophy. not so much the dishes themselves, but the philosophy. >> today i was at the culinary institute of america to give a speech to the young cooks. and i said, guys, remember one thing, you always have to ask, to be a great chef you always have to have three ingredients in the backpack. you have to travel, you have to get contaminated in a wise way. you never forget about where you

come from. but you have to have three ingredients. humility, passion, and dream. humility keeps you grounded. you keep learning. if you are 25, 35, 55, you keep learning and evolving. passion. this is our job. it is not about being a rock star. it is about being, you know, hard work every day. that is the point. passion, when the other people are, your friends are enjoying, you are there and working. every day. and dream is the most important thing. if you can dream it, as ferrari would say, you can make it. >> take a look at these dishes. the first, these are images from the book. mortadella bologna.

>> memory of bologna sandwich. the first thing, gastronomic critics said, what is he going to do, massimo bottura, mortadella? that's a great idea. bologna foam. those memories i when my mom was getting the panino mortadella in my backpack, saying "mangia, mangia, you never eat." that's a tribute to my mom. >> the second image. i dropped the lemon tarte. >> this is the most important plate. the story is fantastic. that night we were ready to serve, me and my pastry chef, japanese, the most incredible technique, fantastic. at that point we were ready to serve, and he dropped one of the lemon tarts, half on the plate,

half out. and he was ready to kill himself. i said, don't kill yourself. it is a beautiful. we captured the moment. that is poetry in everyday life. if you keep that stays open from poetry, him to you have the accountant and and this and that. that space, you can imagine a beautiful broken lemon tart. so we rebuild them in that way.

the imperfection. it became an icon of international cuisine. >> number 3, 5 ages of parmean. >> may be the most important dish i ever created. the dish of the decade for italian gastronomy, 2001 to 2011. this is the way to express. i started reflecting about that, at that texture. after, this incredible visionary man who is a cheese maker, he said, massimo,i have two tell you something. the plate was great, but start thinking about the aging process more than the texture. be more respectful of the process of the ingredients than

to show how great you are on technique. from that moment, i started exploring the aging process and doing my own experiment, bringing the cheese on a different level, to show the terroir, the aging process. 24, 30, 36, 40 50. the time that is passing. >> the next one is the crunchy part of the lasagna. >> that, this is another emotional dish. the corner, the experience of the corner of the lasagna. when my grandmother arrives and brings the lasagna, you have,

you experience like every other kid, that corner, a little burn. everyone knows that is the best part of the lasagna. >> let me talk about art. art has a place in the kitchen, in the restaurant, in your soul. >> art is the highest way to can indicate, the highest point of human thought. art makes visible the invisible. art became for us our landscape of ideas. my wife introduced me to that, to contemporary art. together we are living every day, surrounded by art, by thought.

from a sculpture of a glass of water to the powder of a 2000-year-old vase, dropped on the floor. i'm starting and rebuilding with a contemporary mind. that's my cuisine. i look at my past in a critic way, not in a nostalgic way, to bring the past into the future. that is my cuisine. >> great to have you here. fabulous to have you here. the book is called "never trust a skinny italian chef." you should read the book, and then you will be more encouraged to go to the restaurant, if you can get in. >> you can come. we will push you in. >> thank you. thank you for joining us. see you next time. ♪

>> live from pier 3 in san francisco, welcome to "bloomberg west." i'm emily chang. top headlines -- stocks plunge back after an early plunge. the dow ending the day just 24 points down. the turnaround came after st. louis fed president james bullard told bloomberg the fed should continue delaying the end of its bond buying program. >> the qe program would be open-ended, and we would be able