what is -- that's been very important, and positive but at the same time i would also argue that those images promote aspects of a kind of racial backlash that we've seen against this president, too and we think about the mind of movement and the birth of movements and this notion that the president is not a citizen and some other criticisms. h like hitler -- >> guest: guess, were talking about criticism that crosses the line from just legitimate public policy differences into the basis racial stereotypes and racist caricatures. >> host: what's next for you after this worked quite >> guest: well, i'm working on a biography of stokely carmichael. and so that's what i'm doing. >> host: that's pretty compelling. your students, what do they make

of this. >> guest: well, i think they're fascinated by it. was very interested is now the college student to teacher at eight team to 22. many of them are born in the 90's at this point. this is way after civil rights act, the voting rights act, it's way after the death of martin luther king. this is really ancient history for them and their very fascinated by this. and many of my students really followed the election very closely, very intently, like students at all across the country and around the world. so i think race continues to be this important crucible for them to go through in terms to understanding the history of this country in really understanding our democracy. >> host: do you think that this sets the stage for this election, sets the stage for more african-american to be elected president?

is this something that can happen, you know, again and again or was this unique, the circumstances, the man, the moment? >> guest: well, i think it's both. i think it can happen again but i also think it's unique. one of the things we've seen is that another african-american candidate who would like obama, man or woman, potentially could win and could find. at the same time, can we get a black candidate who is considered very robustly dark skinned, who speaks in the cadence is that black community. can that person when? and right now i would say no because they would turn off a large segment of the electorate. and i think that's going to be the true measure and test of our transformation is a democracy, when again, what reid was saying

his support of politics of realism about the electorate is shaped when somebody again who is not quite and, who is not perceived as speaking as if he were not a black person could win an election. >> host: did you believe that a woman would be a lack did before an african-american? >> guest: you know, it seemed as if senator clinton was definitely poised. and when we think about women and from the country, they are definitely ready for them. so in a way seemed as if that would happen before an african-american, especially because before barack obama arrived on the scene, if we looked at the landscape of black elected leaders, the political leaders, it didn't seem as if anyone was imminent, had imminent possibility of becoming president. >> host: we're just about out of time. but i want to say i'm enjoying this a lot. we are talking with peniel

joseph, professor of history at taft university and has a very deep, complex but, "dark days, bright nights: f

he was a moral or an island in the 18th century, who wrote a book on moral philosophy first. and used to get a set of lectures that choo-choo for moral philosophy to economics and eventually wrote a very long book on economics, often for the founding text and inquiry in the nature and causes of the nation. and he's been extremely everson although as a philosopher i wish people would look at it more as a philosopher than just as an economist. >> we will get to that. the proposal russell roberts at george mason university. what has been the impact of the wealth of nations? >> guest: teaching a lot of economics along the centuries was published in 1776 really saadi holds on for social science. the combination of empirical work, observation, logic, philosophy, all melted together.

it's really an extraordinary work that ascendant norm if impact on scholars in the real world. >> host: professor fleischacker, when we talk about moral philosophy, what do we mean by that? >> guest: well, with which went by it was something close to a because social science in part. that is to say everything today recall sociology, economic, political science, all that would be called up moral philosophy as opposed to natural philosophy. now shofar lasciviously mutated good. but it also meant for him as it does for a the study of whites at right and wrong, good and bad, what human beings are aiming for. and those things are part of his vision of social science i would say. so how groundbreaking was his word? >> guest: it was enormously influential as russell said. almost from the moment it was

written, certainly by say the 1790's. it was being red all over. the prime minister of england as of the 1780's, william pitt had read it already in college, the founders of the united states, especially thomas jefferson and james madison were very much influenced by it and were looking to it for guidance as they shaped this country and then by the time of the french revolution was extremely important in france and germany. so in a lot of ways, and it was to go to but if you wanted to figure out what government ouldo about the economy, but also what government should do in general. >> host: professor russell roberts, do you use adam smith's theories in teaching economics at george mason? >> guest: i do actually. his insights into the division of labor and specialization and trade effinger credibly timely. we are the only university i know that george mason is a

field in smithian political economy. i hope to teach class and my colleagues. we take smith's quite seriously as a role model for a social science should be conducted here at >> host: what about you, professor fleischacker likes do you use pin in your classes? >> guest: i do but same story of political philosophy. an expected to teach some of the classics of the field, especially the field in the 18th century. so do regularly teach a course on scottish moral philosophy in the 18th century that includes figures like david hume as well as adam smith. and i'd like to suggest two students that smith provides a quite remarkable model of how philosophy and social science can be run together. and sometimes look at his moral philosophy in connection with the wealth of nations and see how they interact. poster well, good evening and welcome to the special edition of the tv on c-span 2 in

primetime. we will be light for the next hour, looking at adam smith, "the wealth of nations" and we want to take your calls, e-mails and tweets. so if you'd like to call in to work to guess, will play a little bit more about them in a second. if you like to call in with her to death and talk about adam smith and the wealth of nations, here's the numbers for you to call. (202)737-0001. (202)737-0002 for those of you in the mountain and pacific time zones. and you can always send us an e-mail at the tv at c-span.org or you can send us a tweak twitter.com/booktv is our twitter address. now are two or samuel fleischer actor. he is in chicago right now and he is a professor at the university of illinois in chicago and he is also president of the international almond smith society. professor fleischacker, what is that society? >> guest: that was a society

founded about that as a society founded about 15 years ago to encourage more scholarly interest in smith. one of our models was the hume society, which did help ratchet up interest especially among philosophers and david hume. smith is of interest to not just philosophers or economists as to intellectual historian to literary theorist, often these days. and we encourage the study of smith from all and no political perspective. but to say we try to stay away from the political uses of smith for ideological purposes and simply encourage scholarly work on what he had to say in all these various areas. and we have compensated basically at least once a year and also try to encourage scholarly work and various other forms. postcoital mention david hume twice. who is he?

>> guest: david hume is one of the most important philosophers most people would say of the postmodern. since about 1600. he was a radical empiricism, that is someone who try to develop a theory of knowledge and of morals and entirely on the basis of experience. that led them in certain ways to be something of a skeptic, raising doubts about the existence of causality, even of ourselves and serious doubts about religion. he was also adam smith's best friend and he preceded adam smith and writing interesting essays on economics and many of his insights and five smith incorporates the system in the inquiry into the wealth of nations. host our other guest is russell roberts is an economics professor at george mason university you in the washington d.c. area and a research fellow at the hoover institution. he is a weekly podcast called econ talk. what is that? >> guest: an hour-long

interview with economist, authors, the guy who sold me my car, an expert on and come anything i think is interesting, that's about the world around us and related economics including a six part series i did with dan klein and the theory of moral sentiments. a little bit intense, but for those deeply interested in more scholarly diversion than we usually do in econ talk. >> host: would you consider yourself a fan of adam smith's theories? >> guest: big-time. >> host: why? >> guest: is startling how something with somebody ago with such charm still educational invaluable. my thesis advisor kerry backer won a nobel prize when asked, who would the economist is simplest him and he said adam smith and alfred mosher. we go back and read smith. there's so many insights there. any such a role model for how to use observation, facts, evidence and thinking about the world around us. >> host: before we go to

calls, there's one phrase that adam smith is very well known for her, the invisible heat. we're going to take that from "the wealth of nations" and read the quote to you where he uses the phrase invisible hand, with a little bit of text before it and after. so it gets a little long hair, but we thought you'd want to see their perspective. and this is from adam smith, "the wealth of nations," book four, chapter two.

what does that mean? >> guest: , well, it means different things to different people. what it means to my understanding of smith in the world around us as he was trying out a tradition that was a little preceded good he was the first economist, but adam ferguson was also a scott, talked about things that were the result of human action but not human design. and they take that lineage, ferguson, adam smith, to hayek come in the great 20th century economist. they're all interested in outcomes that are beneficial, sometimes harmful but usually beneficial that no one intended. you often think of the law of unintended consequences is negative and often is. with smith and hayek and ferguson were talking about was human action that creates an emergent order, not designed from the top down, but from the bottom-up by individuals making decisions based on the knowledge that they have actually have access to that no one else has.

understanding that in my view of economics is the single deepest thing economists understand that isn't obvious or just common sense. it's profoundly deep, its new one, it's subtle, good caricature as if everything's going to turn out okay. that's not what smith understood to mean. smith also had a divine access to the invisible hand as the hand of the divine. he uses as a metaphor in this era of moral sentiments and he argues that people through their internal conscience and their worries about what other people think of them are led to do things that make the entire society better off. it's a very deep and subtle idea. it's a beautiful idea. >> host: samuel fleischacker. >> guest: can i jump in for a second? i agree with most of what russell said. the exact meaning for the idea of the invisible hand is very contentious among smith's colors these days. some say it refers to the

divine. smith uses at exactly three times in all his work and in one case it does clearly refer to the divine here in the wealth of nations many people and i would be among them would say there is no reference to the divine. it's just a metaphor that he is found useful elsewhere. whether there's any kind of religious background to his economic theory as i've said is a very controversial. i think russell's main point is the one to focus on here, whether there is or not smith gives us a purely natural secular account of how orders can arise about anybody intending them. and for the most part, how individual action can for the most part pretty something quite good for society as a whole without people intending it. now one thing that smith has in mind, and this is the one thing i want to add to what russell said, that he's opposed to the idea that what not to think that the society would be better

in many cases if there were invisible hand. that is on the one hand, he thinks governments don't necessarily do a better job. in fact, usually a worse job in running economies. and on the other hand, he dislikes as he says in the last sentence as he quoted, he dislikes it when merchants claim to be doing something for the good of society. interestingly there is a letter smith wrote about the same time, about a year earlier and which he refers to josiah wedgwood, the famous founder of the pottery firm, claiming that he wanted a certain law, which was actually going to benefit his firm for the good of england. and smith says in the letter essentially he'd much rather have wedgwood admits he's doing it for himself. basically smith doesn't trust merchants when they claim that they're doing something for the good of the public. he thinks it's better if they simply ask for their private interests. and if everyone does that on the whole, i guess russell said it's

very important he doesn't think this is true in every case. on the whole win people to pursue their self-interest and a well-organized society they will do the public good. >> guest: i like that point about smith's words of people claiming to be serving the public good. it brings to mind the ceo of goldman sachs who recently was quoted as saying he does god's work as an investment banker making sure capital flows to its highest valued use. it's a lovely idea. unfortunately, the current system which is marconi capitalism than real capitalism usurps goldman sachs and masquerades to be serving the public interest. >> guest: smith wouldn't even think it's so ugly. i think you would say it's quite typical. >> guest: smith understood on the part of the merchant or the business person to cloak itself in the public interest. and how dangerous it was. >> host: samuel fleischacker, give us a brief bio of adam smith. where was the race, where did he go to school, ephedra.

>> guest: okay, i hope your viewers don't fall asleep in the spirit he is one of those boring lives of an important human being. his father died before he was born. he was born in a small town in scotland called kirkcaldy. he'd supposedly was kidnapped by gypsies and he was seven years old in the least a few days or weeks later. that's the most interesting thing in this lifetime. after that he went to the university and glasgow, got a special scholarship to go on to oxford. came back and taught in oxford. he was actually professor which is back, and as some of the major intellectuals of the time. he was never a professor. ferguson was largely not a professor. and he took over the course of his own major teacher, francis hutcheson. after that he was hired by a rich noble men to tutor his kid and supported for the rest of his life on that money, even

though he only tutored the kids for a couple of years. and then he retired to sit at home to write the wealth of nations. and funnily enough, after writing "the wealth of nations" in which he argues against duties of any kind, he became a commissioner of customs for about a decade here it and then he died quietly at home in scotland. her rich from various sources, although apparently he gave most of his money away quietly without telling anyone so he died without much wealth to his name. that's about it. >> host: russell roberts, did he ever visit the united states? >> guest: i don't think so but you can verify that. >> guest: he visited very few places. he went to paris and met a lot of major intellectuals in france, matt voltaire which got a lot to them. but aside from that one trip to the continent and i think he traveled very much outside the british isles. >> host: list get to our viewer calls.

(202)737-0001 for eastern and central time. 202-73-7000 to four pacific and mountain time zones and booktv@c-span.org for e-mail and the tv@booktv is our twitter address. rochester, new york. andrew you are on the samuel fleischacker and russell roberts. >> caller: thank you gentleman for coming out tonight. my question is, what about this mr. smith having something to say about a war tax. i heard there was a war tax in the general washington had a war tax. i was wondering if you talked about what both his desire on debt and things like that. >> host: professor fleischacker. >> guest: well, there is a long black and complicated and very technical session of the wealth of nations devoted for taxes, very much as mired for politicians of the time.

they took to see which taxes might be most useful. and in there he talks about funding of course quite explicitly. he talked about was called the sinking fund which was a kind of data system by which britain financed its worst. he complains about by way of financing for technical reasons and i'm going to leave it to russell as he wishes. and says that he would prefer if wars were funded by a tax paid in every war fought. one reason he says that would be advantageous as that would meet the wars shorter. people would be irritated by paying the tax that would make them call for the war to come to an end. i'll leave it to russell to say anything else on this. >> guest: my only other comment for smith on taxes is he deeply understood who really paid the tax as opposed to the tax was supposed to be paid by. and he also understood the incentives that politicians and taxpayers dough with.

and the sam's example of the pain of war being paid for in the contemporary time is a tremendous example of a smith was always aware of, which was how incentives work and effective of politics. >> host: gentlemen, we have a tweet hear from joe orlando. both men show he goes by and he writes, who cares? why should we care about adam smith? >> guest: well, as i said, i teach a class in microeconomics every year of top for about 30 years and is often assumed as most economists to the days of day as ricardo insights into trader the right ones. diversity is a powerful trade. i've come to understand recently that actually said that perhaps the more important idea, which is the role that economies of scale on divisional labour have a specialization even when we're all the same. he has a lot to teach us though. it's not always easy reading. the first three of four chapters

of "the wealth of nations" can be read by anyone today. >> guest: the first seven chapters. >> guest: okay, you're even more willing -- that's okay. the moral sentiment from his first book starts out slowly, very difficult to read but if you get into it it's all about her self-esteem, our self-worth come the tension between our self-interest and doing the right to. it's tremendously powerful but still very much worth reading and i went out again on trade smith's remarks on trade policy, his subtle and ironic understatement of self-interest of merchants bactine often a claiming to be in the public interest, the wool of the politicians. still worth reading. >> guest: i would add two quick thoughts to that. one is smith decided of course vary widely by people for political purposes to this day. he decided as a moral source as well as economic source of the

free trade and economy of what's called the punta arenas a more classical liberalism and then he is also cited by people more in the last. and in many ways, he has been the origin of ideas that are still very much alive in the political scene. and if one wants to trees how we've come to these ideas, our own heritage, our own history, how these ideas have come to be kicking around the political landscape, one really needs to read smith. the other thing i can say is is a founder social science and this goes back to something russell said in the beginning of the program, he sets a model for how social science might be done. and this is a in which scientific observation is integrated with moral thought, in a way that isn't always true among bitter social scientist. in the nonsense i think it's very inspiring, with reading, was looking to as the model. >> host: harrisville,

pennsylvania, bob. please ask your question about "the wealth of nations." >> caller: hello, good evening man. i'd like either of the professors to comment on the new relationship between adam smith and marx is on. and where would someone from the 20th century such as iron brand, where would she fit in regarding the philosophy is? thanks. >> host: let's start in chicago with samuel fleischacker. >> guest: well, many people who study marks point out that for all he identified smith in large part with this system that he marx.he should be of a stronger was due to the past. he couldn't get away from admiring smith. he quoted smith as a very honest thinker and in fact incorporated some of the remarkable thing smith says about the suffering and oppression of workers as

things that he himself could still hold. and in fact, there is a move now i should say even though i sympathize with assault for left-wing wing yousef smith i'm not a marxist. there is a move among many people who were very interested in marx and have a marxist orientation to the political economy to recover smith. all over the academy especially. there are many people interested in marx who are covering smith yet i don't see any relationship between them. i think there may be others who do. i heard emphasis on self-interest only i think is quite alien to smith. i think it's a very different view of how economies work and how societies work. >> guest: i want to emphasize that as well. i think part of smith gets caricatured at the defender of creed. he's not a defender of creed. he was someone who understood the power of self-interest, but most of us put ourselves first.

that's human nature. he took it as it was. he urged us in his first book to overcome that. he talked about how sometimes we do and sometimes we don't. the other part that i think is a brand in about smith is smith talks about the importance of happiness. and he talks about how it appears to him that the world was created for the happiness of humanity. and that's really an extraordinary idea. i think a lot of people learned from ayn rand that it's okay to fall your happiness for smith was certainly not a hedonist or libertine. he was a huge emphasis on the importance of moral values and conscience and doing the right thing that i think is often absent from ayn rand. >> host: the first edition of "the wealth of nations" was finished in 1776. didn't play any role in the u.s. revolution? >> guest: well, as sam pointed out earlier the founders read smith. he did revise it and say one of

the days. he revised it and i think 1782. quite a bit. "the theory of moral sentiments" came out in the 1750's and i don't know how influential it was. >> guest: jefferson had read "the theory of moral sentiments" by 1771. the president of princeton at the time of the revolution and before with a man named john withers and was a scots and he educated many of the founders. and they read what he as a scot thought was worth reading. witherspoon with the declaration of independence and so forth. he that is "the theory of moral sentiments" was worth reading. i wouldn't say however that the "the wealth of nations" played a role in the revolution. what i it is playable and very clearly so as the debates of the constitution. people were reading it. many of the most important founders were reading it by the mid-1780's. they were looking at smith's of national banks.

it was looking at his discussions of militias and standing armies. many aspects of the wealth of nations were very important to the founders and effects that give cited and debates of the constitution in 1787 and 1788. >> host: next call comes from john invalid taxis. his go-ahead. >> caller: yes, i studied "the wealth of nations" and "the theory of moral sentiments" when i was in college back in the 60's. and my professor insisted that she can't understand one without the other and i wonder -- i read both books again in the last two years and i was amazed at how powerful it is, particularly through moral sentiments, he does a powerful job of explaining and reviewing all of the philosophy, plato, aristotle, and other philosophers. and he emphasizes the importance of the human behavior and then

he goes on and "the wealth of nations" he talks a lot about the importance of savings and accumulation of capital and how many comes to be. he talks about the colonies and he talks about the indy is in the colonization. the point of all this is when you read it, you realize it's still relevant today and i wonder to what extent our students and our legislators have studied this enough to really understand. because it's relevant it seems to me to what is going on today. and i guess my question is, how do you think this all relates to what we're seeing today, particularly with what we've done to our money and what's going on with the financial dealings. >> host: thank you john. john, why did she pick it back up and read it? what was your curiosity?

>> caller: while i was an investment banker most of my life. i've been around investment banking for most of my life. and as i've been corrected. and i wanted to pick it up again and i'm naturally interested in philosophy. and i just started rereading aristotle. i picked up "the theory of moral sentiments" again and adam smith is so clear in his explanation and he compares the philosophies and the consequences. >> guest: well, one thing we haven't talked about and "the theory of moral sentiments" which is so important to avoid the character of smith. he explicitly says the accumulation of wealth doesn't make you happy and he wants against it. and he also talks in a modern way about gadgets and how richmond will sell their pockets with gadgets. and they didn't have blackberries and i found them.

they're too thick holders and other things other things that he mocks as a source of happiness and prestige and says they're not real. he says the book is full of important borland section that i think as you point out they have to be right together. i think was smith saw that is so important is the culture, the role of conscious, the role of trust and making it a market system work although his market system is very primitive compared to ours. so the other thing i want to mention, we've talked about how is a role model for social science. a lot of deep insights into the real side of our lives and the economy that are easily forgotten. common fallacy that people subscribe to that smith understood centuries ago were wrong. his whole attack on mercantilism, his whole attack on the idea that exports create wealth in imports are bad. he understood in 1776 that was a flawed and fallacious idea. he understood money, the pieces of paper in the golden solver

want a real wealth. real wealth came from what we produce. he understood the moral sentiments is what gives us happiness and how we produce it and spend our time, not to be spending our time at the office. i mean, he's a profoundly inspiring thinker and both his insights and his moral instruction. >> host: professor fleischacker. >> guest: i think it's wonderful that he studied both "the theory of moral sentiments" and "the wealth of nations" in college. that doesn't happen today and i wish it would happen more often. i agree with pretty much everything that resto said. i would decide this midsize them "the theory of moral sentiments" his conversation with friends. it sociability, if having friends and hanging out with them basically. he doesn't use that phrase of course but he does talk a lot about conversation and that is the greatest source of happiness and that's one of the reasons why morality is essential to happiness. because much of a certain level of decency won't have any

friends. and in that understanding, it's very clear, this is something so interesting, such an interesting irony about economics that material goods are not central to happiness. anyone who seeks material goods at the cost of friendship and morality is making a huge mistake for smith. an msi think he provides something that i think we can easily look back too. here's a man who praises the free market, who is not opposed to the relationship of material goods. the main reason he wants countries to be wealthy and he says is quite explicitly is that he wants poor people to be able to have enough to beat and of clothing on their back. the most important as he often calls on us. he often says her food, clothing and lodging. they are abbreviated by sco in his notes as often. material goods are important. he sees the role for them. he sees the wall for them especially in helping people rise out of poverty. that they are not the goal, not the ultimate goal. when you read the two books

together you really can see that clearly. >> guest: smith says man wants to be loved and to be lovely, meaning we care deeply about how others perceive us and we want to win my respect honestly by being lovely, by doing the things that engender love. and i think what sam points out, which is extremely important, is often people, even economists, forget what the purpose of economic says. it's not about accumulating material well-being. while this important as misunderstood to help people survive, to live long, extremely important. but it's only a part of the story. in economics, people think about the stock market, interest rates. it is about those things but as a student told me once after she went from her teacher, economics is a study about how to get the most out of life. it's better choices, the fact that we don't have an infinite amount of time in an amount of money and we accuse our time which is so precious. and not merely accumulating

material goods. in that sense, economics is to come back to smith and not be as focused on the material. and i think it's useful people understand that's an important role in economics. >> host: here's a quote from "the wealth of nations," book three, chapter three, part 3. >> guest: well, that's a bit misleading. i think it might tend to encourage you to think that making stuff is the road to prosperity. that certainly didn't say that. what he believed was that our skills should be used as widely and successfully and productively as possible. and the way we do that is through our free choices of buying and selling and specialization and choosing what jobs to do, et cetera. but i think he is referring in

that passage and maybe sam knows this better than i do. i think he is referring to it as comparing a semi-modern society fails dinners with her son manufacturing to a more primitive hunter gatherer, even agricultural society. is talking about the natural transition he saw from hunter gatherer to a role where artifice, with the making of stuff became a way for people to use the division of labor. a famous example in the opening of the back of the pen factory, where an individual by cooperating with other people are specializing and not trying to make the pins all by oneself could produce an enormously larger number of pins per person. it's really a deep understanding of productivity and how productivity is enhanced by exchange. >> guest: if i could just pretend for a second. the quote from book three i agree is misleading and affect radically so in a way. it's actually part of his polemic against the mercantilist theories that manufacturing is better than agriculture.

one of the main points of the wealthy nations of the whole is to say manufacturing is in better than agriculture and agriculture is in better than manufacturing. a country should do whatever is best suited for or rather the individuals in the country. if you leave them alone to find her unemployment and this fits with what russell was just saying, will naturally seek the kind of work that is remunerated, which means basically the kind of work that's most needed by the society. so the government doesn't need to promote manufacturing of the cost of commerce -- sorry, manufactured at the cost of agriculture or agriculture of the cost of manufacturing. and then they stomach a technical point, but in the context of the day, where there were many people who thought that the job of the government was to promote the kind of industry that makes country's richest. and some people thought that was

manufacturing and somebody was agriculture. smith says no, leave industry alone. let people find the road work and that will be the best way to promote wealth. >> guest: that idea which was popular in smith's time is still very much alive today, where people think we have to pick and choose the right activities. ross perot said it better to make computer chips and potato chips. that's true if you're good at computer chips. if you're not you're going to get even poorer doing something are not good at. >> host: adams this important new compared to john maynard keynes, milton friedman. >> guest: well, they stand at the shoulders without trying it. they are hayek and friedman more than keynes, but i'm sure came with himself is in the same tradition. >> guest: i mean, one difference between smith and the others is that none of the others that you mentioned fall themselves as a moral

philosopher as well as an economist. this sometimes a very interesting things to say about morality and about moral philosophy in certain ways. but smith's views i think it's a great the study of human nature from a philosophical point of view with a study of human nature in a more empirical way, more than the others do. let me just say a word about that if i may. which also pertains to this question of how you read the wealth of nations and "the theory of moral sentiments" together. there's one thing that we haven't mentioned that i think we might want to adhere. and that is in the "the theory of moral sentiments," he makes clear that in order to understand other human beings properly, to sympathize with them as he says, we need to imagine ourselves into their situations. and we need to do that in great detail. otherwise we will really appreciate what they're experiencing. and he uses that idea throughout "the wealth of nations." in a particularly he imagines

himself in the position of poor labor is a great deal, which he consider role number of later economists in bother to do. but i think as part of what i need when i refers to smith is having this model of how you integrate philosophical thinking about human nature with empirical study. and i don't think that is so true for some of these later figures, although they are very important also in their own ways. >> guest: the argument of course that adam smith are living at a poor time to milton friedman or hayek or can't. he was less specialized. and one of the great aspects of economic growth is at school and specialization. into of course those guys were narrower. they were pretty diverse for economists, all three of him. >> host: j. in hurlburt, florida. thank you for holding on. your run with fleischacker and russell. >> caller: thanks for taking my call this fascinating

subject. i am interested in the wealth of nations as an exercise in social science and i've taken sort of a casual interest in adam smith for years, yet i've not read the book. so my question is, who explains smith better than smith? is there one volume a clear and accurate analysis or interpretation of what he was communicating and if so, what is that title? post a all right, we'll start with professor fleischacker. >> guest: i hate to set you on that road because it is worthwhile reading smith. russell said before, just the first through four chapters of "the wealth of nations" i said for seven you could try reading that and maybe just say the first couple chapters of part -- part 4 of "the wealth of nations" which includes the famous invisible hand chapter in the book of five. that would be very useful. i was introduced to smith for his ninth goal by a book on the great economist and i found that

a fairly good, clear summary of what smith have to say. i think it's probably out of date by now and somebody will probably take it to be biased. there's a man named dede buffy l., who has a least one book, i think to book entitled adam smith which will give you a pretty good summary, very clearly caused and it's very sure. so i guess that's what i'd recommend. >> guest: i would recommend of the library of enomicsibra you can find the entire "the wealth of nations" and the entire "the theory of moral sentiments" available at no charge searchable and it's a lovely and very inexpensive way to get access to the man and his ideas. you'll also find an essay there by samuel fleischacker on deep insight of smith and treating people in a very egalitarian way. it's a great essay by sam. he points out that smith unlike

most of his colleagues of the day actually thought the poor people knew what was best for them. that he was mentally paternalist. he recognized that every human being had knowledge that other people didn't have. and as a result of the best judge of was best for their own interest. it's a very radical idea surprisingly and to change the world. >> host: who promotes adam smith for these days, republicans or democrats? professor fleischacker. >> guest: that is changed quite a bit over the past 20 years. i confess my interest began just about exactly at the moment of the fall of the berlin wall. it began shortly before i should say. but i think that were a great number of people and mostly rather left-wing academy who thought marx is dead, what should we read now? and quite a few found smith. in fact, this is also happening to the political world. gordon brown, the prime minister of britain, even when he was chancellor of the check is a

very profound reading of smith. i've been told that barack obama is also reading smith coming out of the university of chicago is an be surprised. so i think at this point of falling people on both sides of the aisle quite enthusiastically quoting smith, though sometimes for different purposes, which actually takes us back right to the smith's own time when people on both sides of many issues including some of the same issues we talk about today cited smith heard the >> guest: well, i agree with what sam said but i think republicans may claim to smith unfortunately because the use rhetoric that they think is smithian about markets, competition, they often don't live up to it which i think is a great tragedy. i like to see politicians internalize those lessons rather than just use rhetoric for covering up self-interest. >> host: bill in fort lauderdale, good evening. >> caller: good evening. thank you for taking my question.

i was interested in finding out some of the professors, essentially how john maynard keynes might've influenced in specific areas. i know that today consumerism is a result of dr. keynes. and i was wondering if they have any comment on that. >> host: professor roberts. >> guest: keynesian and can't himself was worried about saving too much and not spending. i do think that the mistake although many people would disagree with me. a lot of people think of zimmer is the described it as the foundation of economy. that certainly is not a smithian idea. the part that is smithian is perhaps keynes interest in animal spirits. emma keynes meant by animal spirits is if you team. he meant the emotional aspect are the worries and fears. smith had a lot to say about that. smith was very interested in how

people were often overconfident about their prospects for success are cautious or fearful about the future. and perhaps keynes was influencing. but other than that not so much. >> host: from book four, chapter eight, consumption is the sole end and purpose of all production in the interest of the producer ought to be attended to only so far as it may be necessary for promoting that of the consumer. >> guest: go ahead. >> guest: that's one of the tidbits in one of my pet peeves that gets quoted a lot out of context. as a smith wanted to say, always too consumed as opposed to say and help other people which smith certainly didn't believe. in context, that's again part of smith's polemic against merchants who want the government to help them. in particular, we want to help them promote certain colonial policies by which for instance the colonies can only buy from british manufacturers. to that, smith is saying,

listen, the consumers are working out, not you manufacturers. the government shouldn't be out to help you produce more. the point of production is how for the consumer. in that context he said government should be looking for the consumer needs and not to what the producer claims that he or she needs. >> host: daniel, manhattan, you're on the air. >> caller: our current political discourse in economics, you know, discourse, smith is received upon by antigovernment voices. weren't the governments around at the time -- weren't they monarchies? and what their monopoly monarchies? i do want to offend anybody, but mafia invasion. >> guest: you're onto something there. other smith did in the liver time of a lot of tierney, but of despotism and a lot of plunder by monarchs and others. and as a result he was very concerned about the power of the

state and certainly the democracy that he was living in at the time, parliamentary democracy. he was worried about it there as well. you're right. i think it's important to remember that the context of the time he lived that was part of the reason he was antigovernment. more importantly though the reason he was antigovernment to the extent he was, he certainly was an anarchist by the way, you certainly viable for government and defense, and the court system and sometimes in other areas. but his worry was aware that we should all have at all times, which is the concentration of power in the incentive for politicians to do the right name. that's always a genuine concern. >> host: samuel fleischacker, what did adam smith think about the east india company? >> guest: he hated the east india company. he thought that was a huge mistake, one of the worst things the packet happened is to have merchants will warblers become merchants basically. he goes merchants have an interest that is quite different from the interest of the

citizens. and so we actually wanted to disband it and that's one of his major recommendations in "the wealth of nations" and quite a shame, something of a betrayal of his legacy that even his friends kept the east india company going after he died. let me just say in connection with what russell just said, i agree with all that. i infected even out in the context smith is also worried about the king corrupting the democracy because he was capable of buying out the voters in many places. i would say that here, libertarians who use smith to cry against big government do have a point. i think whether you're on the left or the right, when did you learn from smith is that government can't solve all our problems and some of the reasons for that don't have to do with the faults of monarchy. one thing smiths has often been one thing that i confess i have come from a more left-wing

background have learned from smith is that governments just don't know the right kinds of things to run large economies, to run things in small local situations. you just can't trust anchors of legislatures in a centralized office in the middle of the country to know what's going on all throughout the country better than the people known themselves good as smith says, ordinary people can judge better in the realm local situations than any legislator can do for them. and i think that is a very important kind of message. it doesn't draw the will of government. government can do important things. but one has to ask oneself always comes should government do this, could this be better done by the private sector. that is something smith always does want you to ask. >> host: massachusetts, good evening. >> caller: i just finished reading transport in a one volume paperbacks there is a technical question for either gentleman. it's 1218 pages and not volume.

would "the wealth of nations" suffer at all if the entire disposition on silver were removed? thank you. >> guest: there were a lot of passages in smith that are hard for moderns to read you when i said you should. the first report chapters as a minimum. a lot of smith is difficult to read because he is dealing with economic issues or institutional details that are relevant to us today or were not familiar with. it can be very difficult going. to me what is striking is for a book written in 1776 how much of it is still worth reading. but i think the wise reserve is not a scholar of smith, assam is, and that would include me when going back to the book would have been worth more juice dishes and profitable. >> guest: i think a good excerpt could be put out. i have a thing when i like because they think they often leave out some of the important things about workers and public schooling and religion in book

five. the disposition of the digression on silver i agree with the collar is the first thing i think most people would want to cut out. on the other hand, i gather that it's one of the things that modern economists think is most really be done and actually makes an impressive 20. this guy was pricing silver over 400 years, quite a remarkable feat, even with modern scholarship, but alone with what he had available to them at the time. in order to prove that the price of silver does not inevitably decline as his mercantilist opposition sided and i think it is a pretty good job of it though i can't really judge the technical details. >> guest: i would just that they think it's it's important for any reader or an economist not just adam smith to be skeptical of the conclusions that are drawn. a lot of times they're not always right. smith was right about everything. he wasn't always -- it doesn't come from out finite, "the wealth of nations."

tu's not scripnd intellectually progressive work. you should take many things in there with a grain of salt to learn from it. >> host: the addition we have here in the table is the fifth edition, which is published in 1789. he made revisions throughout the five editions. but this is in the public domain right now, correct? anybody could publish this book? >> guest: about twice a day of extraordinary high-quality version. it's not a knockoff. >> host: anyone can take it and added it in anyway they choose to? gusto i think that's true. >> host: silver spring, maryland. >> caller: hello. i just want to ask a question. i read it, but what is the most important time of a simple economy? how is he going to --

>> guest: is a comment intrigue of older thinkers that work doesn't apply anymore, it's outdated, smith didn't anticipate derivative, for example, or credit default swaps or worldwide investment banking and that's true he didn't. although we had many things in a statement at some of the flavor. that's why you don't want to read smith for explicit understanding of things. nobody could understand, many, many things he understood for timeless. he understood the ball of human nature. he understood our flaws. he understood our highest aspirations of nature. he understood the role of opportunity cost. he understood that money isn't everything. he understood the pieces of paper are 12 and that what we can really acquired is the true measure of our standard of living with our scarce labor. he's really got a lot >> guest: let's take three specific rings which i suspect perhaps unusually rough and i may agree on even on specifics. he is a criticism of the balance

of trade, the doctrine of the balance of trade which seems to me he was dead on them and is set on now. he understands the importance of education and the importance of education for everyone. and he understands the wastefulness of work. understand the wastefulness of whether could've come out of the decades debate. >> host: samuel fleischacker, this tweet given that i want you to respond to. in your view, what would smith think of the great society, affirmative action, welfare? >> guest: that would take a very long time to answer. >> host: you have 13 seconds. >> guest: i've written two books on it. the short answer is those are all issues that were not remotely on the table at the moment he died at some of them were on the table within ten years after he died. that was a huge debate about poor law, with the government who should aid the poor which he didn't get to participate in because he died a little too

early. my own view is that among the things that our government could do and should do if they could do a while was help the poor reaches condition in which they could participate on the same level as everybody else in the market. in my view would be that he would support something like universal health care today for instance although their many scythians who would disagree with me. >> guest: you're crazy, sam. >> guest: he can be read in both ways i think because he wasn't really addressing those issues. >> host: health care. >> guest: i have no idea what his position on health care policy as you he would be skeptical of a top-down single-payer tape solution. that's a long debate for another time, sam. i'm shocked by how much we agree on so far. >> host: both of our guests are also authors as well as professors. c. beltran went, one of his book

is on adam smith's wealth of nations. and rest roberts most recent book is called the price of everything. you can see it there on your screen. who published it? to >> guest: it is about emergent order. hayek particularly focused on the role of prices. it's a novel by the way. it's written for a general audience and it's very smithian and its flavor. >> host: munro, louisiana, paul. >> caller: good evening, gentlemen. initial collegiate career studying economics at auburn university, the name of adam smith was very rarely spoken without thomas malthus coming out. and the contrast between the smith's optimism and now fusion

pessimism and the different schools of positivism and normative economics. and we see this today where we see central planning being looked to for global warming. and maybe we're better off with individuals deciding what could have been better with adam smith's approach to people looking after their own interests and taking care of things that way. >> guest: well, i'm not going to pretend that adam smith would be interested in a private solution of global warming. i think you'd be worried as i am about centralization of power in the hands of bureaucrats. i think of something to be concerned about in any solution of any social problem. i think the more general point is that smith wasn't out aware origin have to deal with what

modern economists call externalities. and that's a case of pollution, global warming would be an example of that. in private solutions to those although they often made progress, they may struggle and there may be able for government and their incident or hobbes would have recognized, maybe not, he would've been worried as i am about about centralization of power in steering people's lives, not because so much essential if howard fully understand what's on the ground, which was sam's earlier point. but also the power corrupts and smith understood that very clearly. >> host: samuel fleischacker, did smith have much to say about monetary policy? >> guest: well, that's the one i would throw back a rustle actually. i think he does have some things to say. but some of us aren't much more technical and better handled by professional economists. if i could just say something about centralization of power going back to the prior question for a second. i think one reason why python i

can agree in principle and disagree and specifics about some of these issues is that smith basically has to broadview's about politics and economy. on one hand, the government should do everything that is important to be done in this society and individuals can do for themselves. that's very broad and very vague, but he does say that should happen. he mentioned public schooling, especially for the poor is one thing that might fall into that category. on the other hand, he is definitely worried as russell is an im and as russell says about the centralization of power. and so the question is, how do you balance those things? how do you have government take care of problems that individuals can't handle on their own, if that the case and global warming might be such a case. health care may be such a case. without, on the other hand, contributing to the dangers of great centralization. one difference between smith and

mouse system on these issues is a different capacity with historical events between the time smith wrote in the time office wrote there was a great famine and things look darker than they had an smith's lifetime and there was also the french revolution and the dangers of government and governmental reform. and so that's one reason for a contrast. >> host: were going to get professor roberts very quickly to address craig pardo's tweet. >> host: >> guest: the party want to mention that particularly interesting for a current situation in scotland between a think he was 17 and 1870, for over a century, scotland had banks issuing the road money. they private currency in circulation. ..

the ways in which government can help society and the need for government in administering justice they agree on a lot of economic issues and some small ones. it's very hard to tease them apart. one difference for the purpose of this discussion is smith put all his thoughts about economics and government into one large systematic discussion and that's not something that he did. >> host: ed, baltimore. good evening. >> caller: yes i have a question concerning spending and saving. what do you say about the government's spending today? what would happen by economists could address? how much of total gdp is all

government spending and if we cut out most of the spending except the necessaries of let's say the war, annie war or we will call it a defense what would employment be liked with large amounts of government spending on national or state and the local levels i mean how what capital keep enough employment going? because at this moment business is and spending, individuals are barely spending and if the government doesn't spend where does the spending come from? >> guest: i think he would reject as many economists to but not all the i.t. we have to keep spending up, the economy afloat. that is a common keynesian view and it is a mean streak view among economics but there's a lot of people who think that is the wrong approach to take.

he wasn't an economist in that sense. the part smith would have a lot to say about today would be the example for example bailing out general motors aig or the money that flowed into investment banks that made alladi lousy decisions. he would realize that is money will spend not for the good of society at large. it's good for the people who get it and he would be skeptical about its value. that's the most important lesson also the size of government is a concern in terms of the power of the state. the question is what are they spending? sam print of smith was an advocate for the government doing things people couldn't do for themselves. people are not going to buy lousy cars for themselves. the government has to do that for them and that is an enormous mistake. >> guest: we have about five minutes left with our guest. in chicago a philosophy professor of the university of illinois at chicago and russell roberts an economics professor at george mason university, a

discussion about adam smith and the wealth of nations. kansas city missouri. >> caller: thank you for taking my call. i love watching booktv. i watch all weekend. i tried to read adam smith at do times. i was on a will, i don't want to see comprehend but it appears some of the undermining in this book is the consumer it's almost consumer driven market as it should be, the merchant should tailor their products so the consumer can buy and which would help the economy as far as the government to bailing out the banks and did not being consumer driven. i curious how the underlying doctrines and adam smith's book would actually see the results of that. >> guest: smith talks about the natural tendency of producers, people in business to gather together to try to

exploit consumers and he's all competition as a great way of preventing that and he also saw the world of commerce as a way of enhancing the virtues that by as you said earlier cough making sure you provided for people like you have to put yourself in the shoes of consumer and figure out what the consumer wanted and that force is extremely important in smith and missing from some of the public policy of the last two or three years. i think we've made disastrous mistakes and in particular the consequences of those mistakes whether you thought they were good or bad or whether there wasn't a better choice and some people argue i disagree but if you felt there was a good choice we certainly now have to deal with incentives that has for the future and that is something smith had a lot to say about. >> host: i want to start with you, professor speed for you to answer quickly if you could, but would smith say about the american economic system if he were alive now? has government intervention replaced the invisible hand? >> guest: well, again, we live

in very different circumstances, and this is an issue -- it's a very difficult question to answer, and i think resisting answering that question is important. jumping in and saying one knows what smith would say today is i think quite dangerous i do have a section at the end of my book called learning from smith today in which i suggest that there are ways to use for both right and left-wing approach to contemporary policy. i don't think the government in the united states is activist enough in some areas as i indicated before the would include health care for me on the other and again, russell i am surprised how much we agree. i entirely would agree we shouldn't be allowed the banks and i would agree that is something smith would say. it's very important businesses failed when they make bad decisions. that is something smith says and that is a kind of government

intervention that he opposes. coming in to prop up industries because you think that particular industry is necessary for the economy. i think smith would have been worried by our very large defense establishment. as i said before, he worries about the government expenditure on war that there can be too much of that. i don't think he would have been as worried as spending on the welfare policy. i do think it's quite clear he would have opposed government intervention to prop up specific industries. >> before you answer, professor, we want to get more data and we are almost out of time. go ahead in lansing michigan. >> yes, this is to make profit from summer to afford and i do not believe that it is as complicating as it sounds. i think it is a matter of physics is the way we are

looking at the situation of the consumer and the business >> host: professor roberts, you get the last word. >> guest: this is proper capitalist society which is businesses that want to thrive in a profit lost system have to make customers happy but as smith would remind is milton friedman often reminded it's a profit in the loss system so businesses that don't do well serving the consumer or make bad investments have to take losses. if we don't put businesses take losses we don't get capitalism we get crony capitalism and that is the road to a very unhealthy world. >> host: that will have to be the last word. we are out of time. russell roberts of george mason university, one of his many websites is econtalk if you would like to communicate directly. samuel fleischacker, also the president of the international adam smith society in chicago. adam smith society .net.

a gentleman comes before both very much for being on book tv in prime time. >> guest: my pleasure. >> guest: thank you very much. >> host: we have two more hours of programming coming up tonight, and every night this week we are going to have one of life hour from eight to 9 p.m. eastern. we have to couple of books out of influence the american political system. tonight we looked at the wealth of nations with adam smith. friday night we are looking at silent spring by rachel carson written in the early 60's. we will have her biographer and another gentleman on to talk about silent spring and the will be friday night. now, tomorrow night we are having to current economic authors on to talk about the current economic situation, and the shlaes and dean baker from eight to 9 p.m. to take calls and e-mails and then on thursday night we will be talking about the afghanistan war that the to afghanistan authors, said the jones and mark moyer will be here to take calls and tweets.

but two more hours of prime time this congressional week. coming up next is henry paulson in conversation with warren buffett, just this past week on his new book on the brink and after that is an after words we taped with joseph, national editor, kevin mer of the, but now here is henry paulson and warren buffett. first full i want to thank you for coming and i should to clear off the bad that i am a friend of hank's and have been so for some years. i admire him before he took the job. i add my durham a lot more after the job he's done as the secretary of treasury. the name of the book is on the brink and that is exactly where

we were in september and october 2008. at that time, our economy, our financial world went into cardiac arrest and we had four people in the operating room we were fortunate as a country to have in place. we had hank, ben bernanke tim geithner and sheila bair the head of the fdic. i know a lot of people in finance and a lot of people in business and government. and i can't think of for that would have done a better job of getting us through that. now it's kind of fashionable to look back and pick at one aspect or another of what was happening and our country's financial system froze up during that

period. some of you in this room were at a party i was at in september of 2008, one to talk was the money market funds saved. if we have 3.5 trillion fun missile by 30 million people who on is and they might are worrying about whether they can get their money that was half of all the process held by u.s. banks at the time you have a panic. you had commercial paper frees up entirely in the biggest companies of the united states and some are described in this book that worried whether they were going to meet their payroll and a short period of time to read the sixth largest bank in the country in terms of the domestic deposits, washington mutual failed over a weekend. you had the third largest bank, wachovia that needed a shotgun marriage on a monday morning to survive. most interestingly the book

starts in early september when freddie mac and fannie mae essentially broke. here are two institutions the guaranteed 40% or so of the residential mortgages in the united states whose debt was held all over the world very significant in younce including the foreign governments that would not have taken kindly to the default, freddie and fannie. you had them owning the very large portfolio of mortgages themselves, and like i say in early september they both work broke. it's worth noting for those who take shots at some of the people who were operating during september and october that institutions freddie and fannie were chartered by congress and were ruled by congress and for those who have heard them criticize the leverage in the

banking system it should be also noted that the allowed them to operate with 40-1 with rich ratio and they let them guarantee over 100 times the amount of capital they had in mortgage guarantees. so the two institutions which were vital to the mortgage market were vital to the integrity of the united states and which had received in this complicated hanks problem and in a short period because of timber they botched all agency congress established to watch the two agencies had given a clean bill of health and a clean bill of health might be fun to go back and read now. let's get on to hank's book and when i got this book i got a little early and expected to learn about the financial crisis and i did. but i didn't realize i will also

learn something about how to attract women. it's a little late on realize. but hank had a sure-fire approach which when he took wendi out on their first date in boston i would like you to describe a few even want to elaborate a little bit by bit like to hear about it. >> let me say before i do that first of all i'm delighted to be here in iowa and the other personnel would be like washington and again, i have been a longtime friend and admirer of warren and he was a pillar of strength and source of strength for me during the credit crisis. bordon was referring to something in the book and i was not a model of maturity when i was a senior at dartmouth college. my first date we were at the

boston and she wasn't very impressed when i made my program and jay peter plan and sailed it. >> did you hit him? >> no. she gave me another chance. >> didn't she go home early that might? >> she went home early that night. >> hank, tell a little bit about -- hank says in the book i and a tough guy. i forget what point you said that but he was all i.t. at dartmouth as a tackle but when the president asked him to become secretary of treasury and hank's initial reaction was what to do it but he decided to do it but he had one big worry and i think the crop might be interested in knowing what makes a grown man trumbull and warren is talking about my mom quite

close to my mother she's a strong woman, three engaged in the interested in politics and policy and she was very unhappy with the war and very interested in women's issues and so on and so there had been a fair amount of speculation in the press i might go to washington and i turned down the opportunity a couple of times and i had assured her i was not going to go because i had no intent of going but then when i reversed myself and decided very suddenly it was the right thing to do not to say no to my country i was in l.a. where we live and still have our primary residence and i was there on memorial day weekend because the president was going to make the announcement tuesday after memorial day weekend so i was going to see my mother. unfortunately at church we were at church together i had a longtime friend asked me about

what i was doing next and i told her as of course she went to my mom and citizen this great and mom didn't think was great to tell my mom she had already known about it and i didn't see her sob that much but she was sobbing and very angry and crying and said to me i started with nixon and now i would end up with bush and i deserved everything i got. [laughter] and i was jumping on a sinking ship but i will say this at the and i say that time i finished in washington my mother had a different opinion of george w. bush. but it was -- it's not a good way to start off and when he wasn't much happier with me. >> one of the interesting things i found in the book and i've not heard a word about this before

was your account how some top russian officials had gone to some top chinese officials with the suggestion essentially that the start dumping the bombs of probably freddie and fannie at that time and that almost sounds like a rage. something the evil guys of wall street bid but tell me about that >> it never happened. but barry concerned about stabilizing freddie and fannie because there was $5.4 trillion of securities that were either insured or issued directly by these institutions and highly leveraged institutions and these securities were held about 1.7 outside the u.s., the biggest portion was inside the u.s. and

i had been trying to get reform legislation from congress beginning in 2006 and to get the kind of reforms we needed but we were unable to get action until they were just on the image, so we were able to go to the commerce and get the authorities and then we needed to spend time poring over the books understanding the financial situation. well, i had in the book on a recount i was and china for the olympics, and there i was given to understand the chinese had been approached by the russians with a suggestion that maybe they could sell some of the securities to get there may be to test the resolve, who knows

why -- i would say probably just i don't know why but we had so many conversations with the russians, the chinese and everyone else i just knew like any kind of sudden selling who would have spooked the markets and i would say it never happened but it was a -- some people say to me just about everything bad that could happen did happen i say not quite. it felt that we sometimes but i worry about another possibility in the sudden decline of the dollar or anything the never happened and one of the biggest concerns i had was getting freddie and fannie stabilized and we tell the story how suddenly we put them into conservatorship which was

essentially guaranteeing the debt because it was in essence an implicit obligation by the united states of america. it was sort of like the banks had the conduits and off balance sheets with implicit guarantees. that was a bit like what fannie and freddie were and we were racing against time to stabilize those before we knew bad earnings were coming from the banking sector and particularly lehman brothers losses so that was a race against time and i was fortunate -- we were fortunate we were able to get it done without the markets becoming spooked or on settled so that's why when i heard in which china got my full attention. sprick there's a front-page story in the journal this morning about freddie and fannie and it's very much worth reading and they said there's

111 billion that's been put in by the federal government but it's expected much more well so in effect it presently looks like the federal government will lose more money than pretty and fannie than a aig by some margin. >> as we look at the program's overall we will get every penny we put into the banks back with a profit and i think we'll get the other programs we may be surprised what we get back and actually even on a fannie and freddie i thinking the federal make a lot of money but by holding the securities. but you're right in terms of the losses and to me the important thing about fannie and freddie is right now the u.s. needs playing a role they are playing. but one of the things that got us into this problem is not just

freddie and fannie but if you look of the weight of all of the programs to stimulate housing it is going too far. and freddie and fannie are not going to be able to stay in the present for. their mission it needs to be shrunk. the need to be restructured in very fundamental ways. but right now we need them where they are but i think how we unwind the situation is going to be very important. >> when you were getting grilled by congress and they would point out how there was too much leverage in the banking system did you get tempted to say the institution they ran had the most leverage of all? >> i was tempted to say a lot of things, warren. [laughter] but i resisted the temptation because one of the things i am

pleased about was i was able to build enough relationships on both sides of the aisle the congress did act before the system collapsed and if i had collapsed we would have easily had 25% unemployment in this country. it would have been a terrible situation and the crisis, the book is to a large extent the story of the collision of market forces and political forces and the crisis came in many ways of the first time with an election on the horizon so what i needed to do was get action from congress and what we got on freddie and fannie which was on the limited authority of any use the word on the specified. it sounded better. but like to keep reminding people that i didn't design this thing and didn't create.

>> to have relations with the chinese long before those and use them to good effect during the crisis and you've been to china maybe 70 times or something, would be the american people's greatest misconception about the chinese and economic system? >> i believe there's a lot of misconceptions the americans have even about our own economic system, and so but i think the thing that we all need to keep in mind is we are operating in a global economy, and so when the other important economies don't do well it hurts us just like when we don't do well hurts others so the worst thing that could happen to us and could have had and during the crisis would be to have the chinese

economy faltered and stop growing and looking ahead of. we try to do well. it's in our best interest to have them keep doing well. there are plenty of differences and there are differences in the economic area and other areas. but i think the most important things for americans to understand is there is a relationship we are both to a large extent dependent upon one another. we of course in the u.s. -- excuse me, can you hear me okay? so in the u.s. we don't save enough. we have a tendency to save too little as a people and as a nation. we borrow too much, and so the

chinese savings and capital are very important to the capitol markets. now chinese save too much and they need to continue to open up their economy. and continue to open up to competition to move forward with the reform process to reform their currency to move quickly to a market-driven currency. also listings. so there's very important differences and but we just need to remember this is a relationship we need to get right and work hard to get it right. spec for he would tell them that in general terms time to time. what response did you get when you talked about spending more? >> i would simply say to them one of the things the started with george bush was a strategic economic dialogue which is being

carried on and what i generally said is we agreed principle, so they agreed and they needed to open up their economy to competition needed to continue to move their currency so it was to a greater extent determined by the market. but we agreed in principle and in the philosophy but it was a matter of speed, so i would be thinking the need to move it this far into this period of time and they are thinking the need to move it this far in this period of time, but we talked very directly about it and i think the thing you need to remember is in dealing with the chinese or any other sovereign nation we need to put it in terms of what it means to which

china and their people so i was totally convinced to the extent they sped up the process of reform it was only going to benefit them and help them get to where they want to get over the longer term and i would say to them i believe in free trade and open markets but it will make it easier for me to fight to keep our markets open if you speed up the process of opening up your markets but i felt we got very good results if you look at the history and what happened to the currency when i had the dialogue with the chinese i think the record will show that it moved. i was very proud of this ten year framework on energy and the environment because again, we are not going to solve the issues of climate and some of

the environmental issues we have and energy issues unless you get the two biggest, among the two biggest importers and the two biggest emitter of carbon to work together and there is a lot we can do working together between the two countries and again i am a big believer of engagement because there is very little you can do in this world that's important globally that's done on a unilateral basis. sprick you mentioned president bush. i'm a little bit like your mother. in fact, i want to get her to me turn now. [laughter] remember, she's changed her mind >> maybe when i'm through with her she will change back. [laughter] the for the book i got more appreciation for what he did in this particular situation.

in fact i have read various economists, eloquent once, adam smith or david ricardo and all that but i really have never heard a more elegant statement that succinctly summed up the economic world than george bush made in september of 2008 when he said in a memorable ten words he said if money doesn't loosen up with a soccer can go down the -- this sucker can go down. [laughter] it was like the gettysburg address, short but to the point. [laughter] as i read the book again and appreciation for the fact she understood what was going on and what needed to be done. was there every time you went to him with proposals he sean you down on? >> no because he wasn't -- he

was only surprised when i was surprised. and i was surprised more than once. [laughter] >> what was the biggest surprise? >> but i will say that i spoke to him -- one of the things i learned from my previous career is no matter what you negotiate i can have all kind of understandings about the relationship we would have been if i didn't have the right relationship with president it wasn't going to be his fault, it would be my fault so i had a year before the crisis to get to know the president to work with him and remember he went to business school and had a good understanding of the markets and economic issues and he cared about them. and the conflict he dealt with was the same conflict i dealt with or anybody who watched markets. we believe in the united states of america that risk takers

should bear the responsibility for their own losses so the big interventions one awesome thing -- i didn't go to washington to do that and he certainly didn't. but from day one the financial markets he understood they were about the economy and jobs so repeatedly i would be coming to him and i wouldn't have to sell him halfway through the conversation he would back me up and say less than we will get through this, we are not always going to look good. these are going to be politically unpopular but we are not going to let our economy go down. we will do what it takes to save jobs, to save the economy and the was his point of view and you talk about my mother and sometimes he was almost like my mother to me. he would be telling me i needed to work out and get more sleep. [laughter]

is to make in terms of the other people on the political stage, it seems about to the election you probably felt that barack obama was both more knowledgeable and more interested in what was going on in the financial crisis than john mccain. does that if you to be fair assessment? >> it is no doubt we'll i had the conversations i had with john mccain which is frequent as they were with barack obama and they were more difficult and i certainly -- he certainly gave me more anxiety about all of that. president obama was attentive, engaged and i felt comfortable he was going to support what we needed to do.

but what i'm quite grateful to john mccain because and have real respect for him because let me tell you is the election six weeks when we went to congress and there's no way we would have in my judgment gotten the t.a.r.p. of john mccain pulled out against it and if he played the populace card we would have been left defenseless. as i look back i am increasingly grateful of the way he handled himself during this period. but during that time i lost a few hours of sleep. >> you describe that one place you got something you issued a veiled threat. i read what you said it, and failed to mikey and peery of [laughter] >> that was when he came back. there was quite a scene.

he was interrupted in the campaign to come back and i remember i was testifying at the time and michele davis here with me today sitting behind me that i was testifying in handed me a note and my blood sort of ran cold right there and she said to me if someone asks you -- excuse me, about john mccain coming back simply say i welcome the involvement of everyone in this and so i think she was afraid what might come out of my mouth. [laughter] she talked to me on the flight on the way down. but any event, so as it turns out again, it was a couple of

days of anxiety but john mccain when he was back spent time with house republicans rallying them and so she did his part and after we got the t.a.r.p. he did not jump on or criticize some of the things we had done which again were very unpopular. american people, and i'm proud of the fact on what level the american people, none of like bailouts and so again i looked at the poll once at some time after the election but after we had done some of the things we had done and i think this may be a slightly exaggerated but on a recall something like 93% of the american people oppose the bailouts and 60% oppose torture. [laughter]

70% worried we would go into something worse than a bad recession. so we have never been able to explain to the american people this wasn't for wall street this was for them. >> hank, you have these consultations with obama although i understand it ended after the election. >> leave out the sort of part. [laughter] >> boasts the president and members of the administration has repeatedly said during the past year they didn't anticipate how tough things would be in the economy but from the message you were giving them expected things would be the stuff or am i wrong on that? >> i would ask you what you expected because of a didn't expect them this tough.

i expected them -- i knew when we went up there is a scene in the book where we talk about ben bernanke and chris cox on september 18th to meet with congress and tell them we are going to need these authorities, and the difficulty we had at that time was as warden said better than i could the arteries of the financial system were freezing up and so i knew with certainty business was going to turn down because when you have companies that it is uncertain whether they will be able to raise their short-term funding most cfo's are going to go to the ceo and say i may not be able to have all of the funding you would like the next 30 days so what is a prudent company do? the start cutting back but congress htthis yet and so they hadn't seen it yet in their district, so i knew

with certainty it was going to get worse. i'm not sure i knew it was going to be 10% unemployment but i knew it was going to be bad so then -- i knew if they didn't do something in the collapsed then the businesses wouldn't be able to find themselves, wouldn't be able to pay for the inventory and pay suppliers and what the employees go and that would ripple through the economy and we would have armageddon. but so than when the economy did turn down we had this terrible situation as congress saw because congress saw the way the american people had seen we went up and said give us these authorities and if you don't we are going to be in deep doo-doo and it's going to be bad. they gave the authorities and we were in deep doo-doo and as

barney frank said it's hard to get credit for preventing a disaster people never saw or could see. >> did you get on your knees to plead with nancy pelosi? >> i did. [laughter] but you have to understand why was in the cabinet room witnessing when both senator mccain and senator obama were there in the middle of the campaign where the congressional leaders were not only did we not come together the the people didn't come to the physical blows but they were verbal and it was chaos and then the democrats assembled in the roosevelt room, and i went in

uninvited and i did it to try to break the attention or get a smile or laughter and it didn't of its desired effect because i remember as i recount in the book i said please don't go out and blow this thing up. the speaker said to me we are not the ones pulling it up and she was right. >> you have a great investment background and have seen how the government operate here just a broad. nobody has had a better perch from which to view the economy and make judgments about the economy going forward and when you were a secretary you have to have your money in a blind trust

and now the blind trust presumably is over. i don't want you to give the name of the stocks also if you want to do it -- but get an idea of the composition in the bonds, stocks, what ever of the portfolio which you had a chance to establish in recent months. >> war in, first of all, you are a great investor. and you do very good and very careful work. one of the things i learned during my career is i'm not a great investor and i need to find great investors. i believe the system, the financial system is stable. banking system is in better shape. i do believe clearly the recovery process has begun. you and i have a comment worry

about the fiscal crisis in this country. >> we are going to get to that. you have one of the best lines i've heard as it relates to that. i am -- you just need to understand also what we are looking to do we are going to devote the balance of the career to conservation and the environment and that is where our money is going so i am not looking to make more. i would like to keep what i have so i am not looking at it with a long-term horizon because i continue to believe with a long-term horizon the best way is to invest in high-quality companies and stocks. that's what i believe in and if i was a young person on would be looking at companies that have good strong market positions for the long term so i have a lot of

what i have is in fixed-income markets and money markets and cash because i -- the others i have attended in growth equities because i still believe that the economy can go down and sideways and whatever but outstanding well-managed companies and particularly companies that know how to operate globally will prosper over a long period of time and that's the way you need to look at investments is over a period of time. i don't put much stake in a quarterly economic data what happened to the stock market today or tomorrow. i think the right way to look at it for younger person is over a long period of time. >> you said you had a substantial income. does that mean you don't worry about the decline and value of currency?

>> welcome you are not green to get a former treasury secretary talking -- [laughter] i really do believe that and i worked very hard that the strong dollar is just very much in our interest and a central to the success and pre-eminence of the united states of america and i believe the best way to have a strong dollar is again looking at it over a long term view, have a strong economy and have fiscal discipline. now i'm not going to give what i think is going to happen to the dollar in the next five or ten years which is why not really focused on because we tend to give away a lot of the money over a relatively short period

of time. >> if i need you a trustee for my children and said you are going to buy fixed-income would you prefer bonds which the treasury inflation or the street bombs? >> i would go to you. [laughter] i would ask you and take your advice. but i would ask myself the question which gets back to where your going to go which is that again it gets to currency a little bit. i've spent time out of this country and also for the major economies. and believe me every other major economy, china included have significant problems than we do. they really do. we're the richest and strongest economy in the world but have to

deal with a relatively few very important challenges, and the biggest one is the fiscal crisis and i shouldn't call with a crisis because it's not the crisis immediately it is a challenge immediately but one of the things i learned and write about in this book is that it's very difficult to get the government to act and congress to act and do anything that is big and difficult and controversial unless there is an immediate crisis. we had an immediate crisis and we still haven't got the regulatory reform whinnied, and again that is something that's absolutely critical. but, so i have no doubt that we will deal with this fiscal

challenge at some point in time but to the earlier we deal with it the less costly it will be the greater our nation will be in stronger our nation will be in the the new less burden the younker generation will have to bear. and so that's -- >> let's go back to the fall of 2008 again and that very fateful weekend of september 12th through 15th. at that point on the friday it wasn't only the extent of aig even though they would come cascading in a few days but you had this big problem with lehman brothers and called together a group of people on wall street and thought you had bar cleaves signed up and i think they wanted to sign up but they ran into trouble with the british government. but it seems to be -- for getting about lehman brothers evin -- if you have merrill

lynch that followed the lehman bankruptcy i think we agree that lehman brothers would have gone instantly. what would have happened if they hadn't made the deal on that sunday? >> that in my judgment wouldn't have busted a week. what people miss and it's easy to miss is this was a doozy. these successes have been building up for a long time. i knew that we were overdue for a credit crisis and i told the president that when i came to washington but i didn't expect anything of the magnitude but it had been building up in the united states and europe and as you can see from reading the papers it is still working its way through the european system that's been building up for a long time and the institutions

have been sitting on losses. we've been pressing them to recognize losses and raise capital. so, simultaneously we have on the same weekend we learned about the extent of aig's problems on saturday. and the run had already started on lehman. merrill lynch was great to be right there, you had these three institutions, and as warren said we had washington mutual and short lee wachovia, and over the next weeks we had six european nations to step in and recognize the institutions said this was coming at us pretty quickly from all sides. >> it's ironic but in effect, i see to talk about canellos having an appetite for deals or

something but if in a fact he hadn't made this deal which doesn't look like it's necessarily the greatest deal he offered a 70% premium on the day the next stock might have been zero but didn't he save the system for us? >> i tell you he was a confident decisive ceo and there's no doubt that was very much a stabilizing action. >> do you think we would have gotten to tuesday on aig if there hadn't been action on merrill lynch that today? >> i don't know what would have happened because i don't think, warren, i don't think we could have taken one other big institution failure, do you? it's just the system is -- i think the thing that is hard for people to understand is we had

ten institutions that had 50 to 60% of the financial assets of the country and there was so interconnected in many ways we were as bad as this is and it's terrible, but we look what could have happened and we are pretty fortunate. >> hank, the british had given you that kind of british like warning about the situation a couple of days earlier. but in fact they blocked the barclays acquisition of lehman brothers. do you think they understood what the consequences for? >> i don't know everything they

understood, but remember there was a requirement for a shareholder vote -- >> but we overcame a lot of things in this country for requirements. >> but the -- what we needed was we needed a lawyer that could do what jpmorgan did with bear stearns which was still hold and then guarantee the trading during the shareholder vote because there was no authority to do this in the u.s., and what i think people have a hard time understanding because we are the united states of america and i had a hard time understanding until i started turning over every stone to see what authorities we had that there was no authority to guarantee liabilities or to put capital into institutions and. but any event, i'm not sure --

the british were -- i had said in the book and used some rash language when i was disappointed but as i sit in the book as i reflected on that, they obviously had their own issues they were looking at and the regulator was for them a very difficult, it must have been a very difficult decision to let one of their banks go ahead and in the middle of a from on lehman brothers step in and make the acquisition and the confident they have the wherewithal to do that. >> hank, lehman did go down on that sunday, and barclays then bought a limited part of a much

smaller transaction. i think it was tuesday or wednesday of the british -- i guess the british authorities said if you have an account with lehman brothers and they were keeping your securities there you couldn't take it out. they froze the accounts basically, which i gather kim as expressed to you, certainly it can as a big surprise to me. >> i think that shocked the market. my recollection is that was tuesday. because i recall learning about it tuesday, and that was actually the day that -- of the aig rescue but what happened was a collateral third-party customer in the collateral accounts, the broker-dealer and others were frozen for a while and investors needed to know that their accounts were safe.

and of course when they were not with lehman brothers in the u.k. than there was a big erosion of confidence in the investment banking model. >> that wouldn't have happened in the united states. you would have access to your securities. as i remember that didn't get publicized much but it was a shock. did they consult? >> they did it wasn't with me. remember the sec was the regulator said the sec was a regulator for lehman brothers and was the one that had the lead in preparing for the bankruptcy because we knew that was going to be a possibility we hope to avoid and they were the ones that would have been

talking to the various authorities during that period of time, british war came to a surprise as a lot of the investors and a surprise to me. >> hank, you and i don't entirely a huge investment banking trading firm and its own verdone asset, we can't sell it. and we've got all these talented people making lots of money. you are the head of the compensation committee. what sort of arrangement do you have with them? anybody make 25 or 50 million a year? how are you going to treat these people so they keep making money for us and they don't leave and go someplace else? >> i would say we have to talk about it like we are doing this and what it is we are making -- >> let's say we are making it today. [laughter] >> well, today warren, you have to know you and i. -- new york city and i write in the books

and i would have been conversations with wendi all the time during the the benign period -- the by think the compensation levels on wall street, you know, are of the wac, i believe that in general during the the benign times and to what, too. just in general in terms of how you -- number one. and number two, today in light of everything that's gone on and the fact that the tax payer came in and granted the reason the taxpayer did was to prevent calamity that it came in and helped the whole financial system, so not just of the big banks and investment banks but hedge funds everywhere, i think that today the restraint is very much in order by the top people, and i think the anger is coming

from if you have losses you are supposed to bear responsibility for those losses. .. the financial system down and the economy down with that. so, i would like to see congress get that done and get the systemic risk regulator that can

look at any institution, no matter what the size is anti. and if they see risk that our imprudent, restrain them. so i like to see that. now in terms of longer-term compensation, clearly you need compensation. but it should be in equity for the high paid people. it should be something that rewards long-term performance. it the only thing that counts. long-term performance and aligns incentives of the individuals the company and its shareholders. >> are we getting the hook? >> gentlemen, we are done. [applause] >> thank you so much.

>> coming up next, but tv presents an hour-long interview program where we invited guest host to interview the offer of a new book. this week history professor peniel joseph recalls the power movement in his book "dark days, bright nights: from black power to barack obama." mr. joseph contends the 1965 voting rights i spent a significant role in the ascendancy of black radical politics and assisted in paving the way for future african-american political leadership. peniel joseph figures malcolm x. and discusses his book with kevin merida author of the national post. >> welcome to booktv "after words." we're talking to taft university history professor, peniel joseph, who has a very

compelling new book out, "dark days, bright nights: from black power to barack obama." welcome, professor joseph. >> thank you. >> host: tell me what that title means. at the very intriguing title. just go well, the title really talks about, refers to wear black people have come from in this country, really from the dark days of slavery, segregation and jim crow all the way to having the first african-american president. >> host: it was kind of a little ditty during the campaign that you mentioned early on in the book. and it goes rosa fatso martin could walk so barack could run, so your children could fly. and that became kind of a catch phrase toward the end, particularly among

african-americans. you cite this and say that that emotionally powerful as these words may be, they make for poor history. explain that. just go. absolutely. the whole notion of rosa parks has become this iconic trope in the story of the civil rights movement. and it's really. i like to call the civil rights movement. what i mean by that is may 17, 1954 come to august 6, 1965. that encompasses the period from the ground desegregation court decision on the way to the signing of the voting rights act by lyndon johnson. in between, what we're told, both as students and as a nation in terms of popular imagination is that there's all kinds of sedans and marches and demonstrations that occurred, but they're really done by the famous iconic people. basically it's rosa parks, who just was so tired that she refused to get up from the bus in montgomery, alabama inspect

the bus boycott. and basically a young preacher, who even the president referred to during the election as this young preacher from georgia, which is dr. mark luther king junior, who sort of leads the masses of african americans from racial oppression. so this notion that rosa sat and martin could do this staff and jesse could run and then block could fly. all these things, they sound good, but they really simplify a much more complicated history. and that complicated history really involved so many african-americans, women and men, who proactively dismantled racial segregation, including rosa parks. rosa parks was an activist. she didn't just refuse to give up her seat by accident. it was a concerted, strategic effort to try to transform democratic institutions. so the lesson that we have to impart to our kids into the nation is that this isn't just something that happens by

accident, by these iconic figures like a dr. martin luther king jr. who came down from on high and helped the rest of us. i mean that was really a debate during the election because remember hillary clinton at the during the election that will even know martin luther king jr. was important, it took a president to sign the voting rights act because that's when then senator obama kept invoking dr. king. he kept invoking dr. king and the fierce urgency of now. and hillary clinton, then senator clinton, said hold up a minute, it took a president to sign that bill. the she was invoking this notion that look, our politics are still run in a top-down way. even though canwest that if seminal figure, her point is that you still need a president to transform this institution, transform this nation. and really i think that the most transformative parts of our history, especially when we think about the civil rights movement in the black power movement and the social

movements of the 1960's and 70's in the postwar period. it's really ordinary people who transfer in this period. it's really sharecroppers, seamstresses, people who were imprisoned. if a student, regular people who then converge with these figures to become iconic >> host: you know, one of the things i loved about your book, which is the complex of the of it and how you have taken a history of african americans and have drawn a complex fortunate particularly at the iconic figures that you cite. you know, martin luther king jr. for instance, e-mail, also was a critic of racism and protested against the vietnam war and called attention to urban rural poverty. and he had a different actual life that often is described and remembered as kind as this

figure who, you know, somehow gave this great i have a dream speech. but there was some hard edged parts of dr. king's portfolio. >> guest: that's an important point and one especially worth mentioning. we're about to celebrate dr. king's birthday, january 18th. dr. king has really been shorn of its complexity and really has radical edge. i mean, king is one of the most vociferous critics of american democracy. he describes america as the biggest purveyor of violence in the world by 1967. and we have to take note that his riverside speech, april 4, 1967, new york city, when he first comes out against the vietnam war that a robust public way is given one year to the day before he was assassinated in memphis. so when we think about king, especially between 1965 and 1968 come even two years before riverside, by the time king is going to chicago, he's in chicago to try to transfer the forms here detoxify slum

clearance campaign and desegregate housing in chicago. he's talking about poverty. he's talking about economic marginalization of poor people, laborers, king makes a very famous speech where he talks about all labor has dignity, which is one of his best beaches in 1968. kingsport people campaign is something that we shunt aside as well. we really keep dr. king frozen on august 28, 1963, with the i got a dream speech right here in washington d.c. and we don't think about the king who was much more combat and come even though he was nonviolent because king believed that she could use nonviolence as a moral and political force, really a battery to transform democracy. wasn't that king was not combatants. he was very combative. the day was between king and some of even his african-american critics was he didn't believe that violence was acceptable politically or morally. >> host: and you know, it also was true that king wasn't --

everybody praises and now, but back in the time, even among african-americans, a lot of people didn't want him coming into their towns and neighborhoods because when he left he made life more difficult for many of those who had to stay behind. tesco absolutely. when we think about king and the southern leadership christian conference, they are the mobilizer's of the civil rights movement. they're not grassroots organizers in the student nonviolent coordinating committee which is led by stokely carmichael. team goes into places like worming him, like albany, georgia, like chicago, like memphis, tennessee, andy really stirs things up enough with so interesting about dr. king. demanding dozens of things for mayor daley in chicago in 1965, 66 of slum clearance, really an early version of affirmative action for the city. andy really precipitates fear

and loathing among the white population, but also among certain black power brokers who have their own relationship with city hall and mayor daley and they look at king is really this outsider who's really upsetting the delicate balance of power in their own city. >> host: let me positive conversation about just to ask you what compelled you to write this book. >> guest: well, i was really transform them impacted by the 2008 election. and in a way what i wanted to do was really cannot the election results with my own work on postwar african-american history, especially the civil rights and black power movements. i think one of the least reported stories of the election was the impact that black power radicalism had on the nation in terms of transforming the nation in math to elect the first black president. when we talked about obama

during 2008 election, most people talked about civil rights, including the then senator obama. in fact, one of his most famous beaches within 2007, commemorating selma and the demonstrated that occurred in 1965 that really culminated in the passage of the voting rights act several months later and famously came to attend another certain way from admin penders bridge. john lewis was head of the student nonviolent chordata committee and was going to be brutally beaten. it's really one of the iconic images of the civil rights there are. and what obama said, senator obama sat down at that speech was that the new generation of civil rights activists were the joshua generation. he called dr. king's generation moses generation and it was really the joshua generation, people like him who were going to see the promised land. so he really put themselves

directly as an errand beneficiary of the civil rights movement. now in contrast, we really never talked of the nation about black power during the election. and when we did was only in a negative context connected to reverend wright and racial controversies. one of the things i wanted to show an argument in this book was that the black power movements, even though it was a very combative movement, even though it was very forceful in its criticism of racial segregation of racism, of american democracy, it really did say the foundations alongside about civil rights movement, with transforming this nation to have the first ballot president. >> host: you write that the black power movement remains the most misunderstood social movement of the postwar era. >> guest: absolutely, when we think about black power in the popular imagination still, we usually think of black power as a movement of violent gun toting black enters another's, a movement that was antiwhite, a

movement that really drive down more successful counterparts, namely civil rights for social justice. so basically a movement to practice politics without portfolio. and the civil rights movement fuel plant direct dr. king's drink of the beloved community. when in fact we think about the black power movement and the tablet occurred empirically, black power really grossed out by the same historical context that produces civil rights. it's really growing on early 20th century african-american activism. people like markets are becoming hubert harrison, the harlem renaissance. and in its postwar context is going out of the activism of mathematics and the nation of islam. but also secular radicals, people who were into trait like the reverend albert clegg, james embrace the bog, james baldwin and lorraine hansberry. so when we think about black power, it's got a very ecumenical, very secular side to

it. and it's a site that people don't discuss. one of the most interesting aspects of setting the black power movement is the way in which there is an intellectual social political cultural component. so on one score, black power activist or to transfer and curriculums in high schools and colleges. on another, they try to transform african american consciousness or cultural centers, through poetry and prose. on another score, they try to push for anti-poverty and welfare rights. when we think about black power in a popular conception, we don't think of black women being at the forefront of that movement. but black women really were some of the key activists in the movement and matches the iconic figures like angeles davis and kathleen cleaver who work are important. it also poor black women who were welfare rights in tennis right activists in place by storm north carolina in places like baltimore, maryland, in places like philadelphia. certainly black women participated in a movement in

organizations like snake and organizations like the black panthers. but for the most part, more black women and black people participated just an ad hoc black roots organizations, both on university campuses and off campus is in the 1960's and 70's. >> host: you mention a number of people who were kind of in the shadows. i want to take a kind of is a personal note to cite one william worthy, who turns out was an adviser toward black student newspaper at boston university when i was a student there and we founded the worthy with their. you mentioned him and another in a number of instances where he was one of those people kind of than the forefront among the african-american radicals, got to know malcolm x. inflatable as an african-american journalist when you go into china, when you couldn't go to china.

just go absolutely. he is one of the unsung heroes of this era. though worthy was built in 1921. he is one of the key radical black journalist of the 1950's and 60's. he goes into the soviet union and the late 1940's. he goes into china in the 19th east. he is one of the key black journalists in cuba during the cuban resolution. he's a friend and ally of malcolm x. his key domestic idea is something called the freedom now party and it's going to be one of three black independent political parties in the 1960's pier one is the freedom now party. the other is the mississippi freedom democratic party led light for any domain or the sharecropper from louisville, mississippi, who was not allowed to be seated at the 1964 democratic national convention in atlantic city, new jersey. and the other is going to be

allows county freedom organization, which is mixing the black panther party, which is then allowed county alabama and that started with grass-roots locals with the help of sncc activist, especially stokely carmichael. he is a activist who is also a pacifist who went to jail in world war ii for refusing to fight in the war. the worthy once a foreign policy that's based on human rights. way before president jimmy carter talks about a foreign policy based on human rights, william worthy was talking about this. and worthy as one of the people who is part of the ropes and generation. the group of activists who come of age during the prime political time of paul ropes and was really the key african-american political and cultural figure of the 1930's and 40's and 50's was going to be really marginalized by the cold war between 1951 and 1958

robison's passport was revoked and he's not going to be able to earn a living outside of the country because of his left-wing beliefs. robeson never joins the party but is very sympathetic to marxism and communism and he's got to really suffer because of that. but were these extraordinary and he provides this different genealogy of black power hearing people like william worthy, willie richardson who was the activist from cambridge, maryland, who was called the lady general of the civil rights movement to wish an unprecedented struggle in cambridge of maryland in 1963 in 1964 to help desegregate the city, met with attorney general robert f. kennedy to sign a peace accord in the early 1960's. it also goes to malcolm x's n-november grassroots leadership conference in detroit, where malcolm delivers his famous message to the grassroots, where

he really plays out a secular vision of a domestic national, but also international global political revolution. >> host: you write them out the max was nothing less than a civil rights era is invisible man. just go absolutely. and the terms of the way in which historians view malcolm x, malcolm is not part of that to grow it. at the civil rights movement. he usually only possible around 1963, 64 and he really only serves as a foil to dr. king. he's more characterized or really characterized as this profit of rage, who's not a brilliant political strategist, who's not a local and national political organizers and he's not really one of the most important figures of the postwar period. >> host: and you note that back in the 50's he was probably the most important political grassroots political organizer in harlem. >> guest: absolutely.

malcolm x was released from prison in 1962 after serving really six years in prison for burglary. he transforms himself from malcolm little to malcolm x while in charlestown prison in massachusetts. he comes out of prison and he works a number of odd jobs while also working as a muslim minister. in 1954, he's opening up a mosque in philadelphia, but he also becomes the head of muslim mosque number seven on west 116th street in harlem. and right away, malcolm becomes the key muslim black muslim figure in the entire group here the group was from a group that is several hundred when he joined in the early dust a 1940's early 1950's to having over 25,000 by the time he leaves the group. but what's really important about malcolm is between 1954 and 1964, when his village is most active in the group, he leads the leave the nation of islam by 1964.

he transforms that group from a sectarian group to a secular group. he really transforms a group that is not on anyone's radar to a group that's really considered by the fbi to be one of the leading subversive groups in the country. and by 1959 is a mike wallace documentary newspeak five parts in the summer of 1959 that he produced that makes malcolm and the nation national international figures. louis lomax is the african american reporter of the 1950's and 60's before his untimely death. as one of the key black journalists who interviewed malcolm, but also becomes an expert on the nation of islam. >> host: you know, one of the things about malcolm and all those things are true that you said. but there was a kind of raw language that would just kind of a searing, piercing, he would say these things.

here's something, you know, a quote during a press conference. and he was obviously someone who thought that american democracy was just not equipped to protect black americans and that was not, you know, made for african americans at the time. at a press conference in washington d.c., he said if anyone says a dog on a black man, the black man should kill that dog whether he is a four-legged dog or two later died. that's hard to say in public i'm sure at that time. and maybe you could just kind of put that in perspective. even today, we don't get, you know, important african american leaders standing up and saying things like that. >> guest: absolutely. one of malcolm's most important church or six was the ability to speak truth to power. it's really going to be probably the most eloquent, radical critic of american democracy during the postwar period.

malcolm also is bold enough to criticize president kennedy for not acting privately enough in birmingham, alabama. what's interesting when we set a malcolm x and when we look at him is that malcolm really serves as a counterpart to king, but in a way that people usually don't think of. they usually think of it as a counterpart to king as the good black man and malcolm is that bad, nasty, antiwhite black man. not them as a counterpart, saying things that king cannot say very boldly in a very confrontational manner, but that actually give king room to negotiate. and give not just king, but also where wilkins of the naacp at whitney young of the urban league to negotiate because people are looking at malcolm as being so extreme because of his robust criticism of american democracy and american politicians. but also against the politics of white supremacy that he gets these other civil rights leaders

room to maneuver. but this whole notion, the quote that you take from, malcolm had a great gift of speaking to ordinary people. jimmy baldwin, the great african-american writer, the genius right or the 1960's and 70's has often said that malcolm had such a love for african american people that he spoke to them in the language that they understood. and one of the recent malcolm was able to so effectively communicate with africans americans is that he was really from the black working class. i mean, not them had been hanging out with hustlers. he was in roxbury, he was in detroit, he was in harlem. before he becomes a muslim mosque minister in harlem, he was telling people illegal substances in harlem. and so, malcolm knew how ordinary everyday people in harlem felt, how black people felt. he knew how african-american people in barbershops, beauty shots, he understood the

african-american church, not just the nation of islam, but the black church as well. so when we think about malcolm x, he becomes a very singularly important figure, but not just as some kind of positive rage for some kind of icon. he's actually an important grassroots local organizer and not just in new york and detroit and in chicago and in other places as well. >> host: and long after his death, he had become enough of an american figure to get a skip, postage stamp. >> guest: certainly. there's certainly a rehabilitation of malcolm x has occurred over the last 20 years. we start with spike lee's film, malcolm x in 1992. the reissue of the autobiography of malcolm x and also the stamp. but even barack obama, barack obama's autobiography, dreams from my father, he expresses admiration for dr. max. he said he admired his self determination and ability to re-create himself.

so when we think about malcolm x, malcolm x is really the quintessential self-made african-american man of the postwar period. >> host: and race, regardless of where you lie on the ideological spectrum, i'm reminded that justice clarence thomas also embraced malcolm x and have the collected recording of mathematics and found something important enough to max series himself. >> guest: absolutely. i think conservatives really admire malcolm x's notion of bootstrap pulling. all yourself up by your bootstraps, political self-determination in this whole notion that malcolm would also say that black people had to do for themselves. malcolm in the nation of islam in their province refused handouts from the white man. so conservatives would definitely find something that was a great attribute. >> host: another important figure in your book and you

devote considerable space in chapters two stokely carmichael. just a guess, stokely carmichael is one of the most important african american political activist of the postwar period and the civil rights and black power. he is going to be a key civil rights activist who becomes a black power icon. and what i mean by that is that stokely is one of the only black power figures who would also banned a civil rights organizer and the deep south. he's from the caribbean. he sported port-of-spain trinidad june 29, 1941 and migrates to the united states two weeks before his 11th birthday to 1952. he lives in the bronx. he's one of the only african-american students who test into bronx science high school in 1956. and that's one of the most prestigious high schools in new york city. even as a high school student, he's an activist. by 1960, he enrolls at howard

university and joined for nonviolent action group at howard, which is a friend of sncc, an affiliate of the committee. in 19 years old, stokely carmichael becomes a freedom writer, goes down south and is arrested in mississippi and spends 49 days in parchment farm, mississippi's worst prison farm. he celebrates his 20th birthday in prison for civil rights activity and that's going to be the first of 27 of rest between 1961 and 1966. what's really important about stokely carmichael and that i try to convey in this book is that carmichael is one of the few americans domestically during the 1960's who actually bleeds for democracy. what i mean by that, it undergoes physical terror and violence at the hands of hate groups and really domestic terrorists in places like the mississippi delta, in blount county, alabama, in cambridge,

maryland, and washington, d.c. to promote voting rights and citizenship rights for all african-americans. >> host: do you know, i want to get into -- we're getting close to our break time and i want to get into some contemporary thoughts and get your opinion on what's happening now in the currency. but we'll be back in a couple of minutes and then we can talk about current events a little bit. >> guest: absolutely.

>> with your wildest imagination, if you're writing fiction you could not have made this story up. >> adtran >> host: welcome back to booktv "after words." we're talking with professor peniel joseph, taft university history professor. and is a very interesting book which i recommend, "dark days, bright nights: from black power to barack obama." it's a great piece of work and congratulations to you again. let's talk a little bit about, you mentioned in your book some

of the media coverage, you make references to the media coverage of president barack obama and some of his views and speeches about race. you said have not been as sharp coverage and sharp and precise as it should be. tommy how you think of obama as the first african-american president has been covered here to >> guest: well, i think it's been covered in unique and interesting ways. i think it terms of the politics of race, race is always shadowing and contour in this presidency. specifically, when i talk about in the book and i try to write about is the way in which when the president has tried to talk and address space as president of the united states, how the media has really read those speeches in ways differently than i would have. for instance, there's an naacp speech that the president gave

last year, 2009, celebrating the 100th anniversary of the civil rights organization. and in that speech he really does a couple of things. one, he critiques african-american who are doing the right thing, people are taking their kids, people are promoting education for their kids. but he also acknowledges that racism is still a huge part of the united states. so he really does a litany or rollcall a civil rights activist. he talks about criminal justice system and the racial disparities there. and it's a well-balanced speech. what was interesting is the reporting afterwards just as well, obama told by people to get their act together. and so, what's interesting is that the media and what the president is talking about race, the most interesting aspect that they find is if he's chastising african-americans. and that's what happened during

the campaign as well. and i think that had produced some tension between jesse jackson and then senator obama. another example in terms of race was the skip gates incident in cambridge, where the president said that cambridge police department and acted stupidly and immediately the media came down on hand as sort of siding with african-americans for quote, unquote, showing his true colors, meaning that he was definitely a part of him. he definitely was on the side of black folks. because remember, then senator obama runs a somebody who is above the fray, someone who can be an honest arbiter or umpire in terms of race matters even though he happens to be black. and probably example of obama is as free speech in march of 2008 and i was a speech that the president made while he was still a senator, when his association with the trinity church, his 20 year association with the trinity church in

chicago and its pastor jeremiah wright, threatened to derail his candidacy because bloggers have gotten videotape of jeremiah wright, basically partially criticizing u.s. domestic and foreign policy. and they said well, if this is obama's preacher, then obama must share the same beliefs. and so what obama does was get a very good speech on race that was perceived as being extraordinary. and he basically said, he parsed very well. he sat on one level he disagreed with right, but on another level he could understand where he was coming from. so on some level to criticize whites and blacks equally and that speech. >> host: but ultimately had to cut his pastor loose and ultimately apologized for his choice of words during the gates episode. how do you think he's handled, you know, these controversial

moments that you just cited? >> guest: well, i think he has handled it as best as he can in the sense that a first black president he is forced out of necessity to tread lightly on racial matters here and he did this as a candidate, too. he would say on the one hand that yes, america has its history of racial slavery, this awful history of segregation. but on the other, he was a prime example of the progress that has been made. another great example is the three times he mentions race during his inaugural speech. you know, he talked about those of us who i felt the lash of the whip during the inaugural speech. that was a reference to slavery. he talked about segregation at one point. and then he finally talked about his father. he said that his father might not have been able to sit at a restaurant in washington d.c., you know, decades ago because of this race. and he was right about that.

so on certain levels, sometimes obama plays, you know, history professor and chief and not just commander-in-chief. andean parts of the lesson unto the body politic. but for the most part, he's tried to stay away from racial matters, which is very impactful on the african-american community, especially in terms of public policy. >> host: now there was a recent flap that was disclosed in a new book by two journalists called again changed, which revealed a private conversation harry reid had, the senate democratic leader. essentially backing obama up insane this was a natural view calling him the fact that he was light-skinned african-american and did not use the dialect

unless he wanted to. and there was a lot of back and forth on that. over the week. and what do you make of that comment and the controversy that occurred? >> guest: i think it engadget shows the complex via the african-american faith when they're trying to judge the sincerity of even their supporters in terms of harry reid politically is not a right-wing politician. he's a democrat. he's one of the people pushing health care. he was mutual initially during the campaign, but then when obama became the nominee he was a supporter and now we know through this book behind the scenes he was a supporter who had wanted obama to run. and so, on one level we can think of read-out somebody who even though he is a great admirer of obama, he still had

his own racial issues in terms of the way in which he perceives black people. and it's really coming out of the baby boomer generation. this notion that obama is light-skinned and not speaking in a negro dialect. even the term negro is a very antiquated term and certainly a pre-black power movement term. so, i think it just says that when we talk about our politics, the race still matters. even people who publicly would proclaim that it doesn't, privately the words show something different. >> host: the suggestion i guess was that him being light-skinned, his skin color and how he spoke would accrue to his benefit and make him more palatable to a mainstream voting audience. and make them more successful.

what are people saying back when you say that someone does not speak in a black dialect or that you focus on the skin color, what kind of person are they saying he is? >> guest: well, they are standard is close to what mainstream white america would find acceptable and that is not a typical black person. i think that's what they're saying. and i think it's very interesting to read comments were very, very -- they were set within the context of the support and actually contrast with something that former president bill clinton got into hot water for saying during the 2008 campaign when he said that jesse jackson ran a good campaign in south carolina and barack obama has run a good campaign in south carolina. so the inference they are or at least the inference taken by many was the notion that obama was another jesse jackson and that clinton was trying to sort of smear the obama campaign as the black campaign. because everybody knows in the

united states in american history the black candidate ever wins. you have to be a candidate who happens to be black to win. and obama really flipped the script and became this phenomenon. >> host: is he the only african-american to get elected president? was the only person on the scene who could have led the president? >> guest: i think so. in a certain context we could say you leapfrog over certain people, some electrodes for junior was considered an up and comer. >> host: who is considering running for senate race. >> guest: with interesting about the democratic party is that in 2000, 2004, back-to-back they gave these bright up-and-coming african-american men to keynote address. the first black person dressed to do a keynote address was barbara jordan in 1976 but then an back-to-back in 2000 los angeles and this was a commissioned by the way that

barack obama could not attend. >> host: i was there. >> guest: he couldn't even get in, couldn't get credentials. by 2004 his credentials for change in a given extra newspeak or. that catapulted him really to the senate because he wasn't a senator when he gave a speech and then to the white house. i was was a guest that he was the only person in that context who could have won. >> host: : powell who declined to run in 1996 with someone who pulled really well. was he someone who could have been elected president of this country? >> guest: will you think colin powell would've had a tough time getting his party's elimination. colin powell is a republican who's much more in a moderate theme of the kind of republicanism that is now a lost art. and i think people like nelson rockefeller -- there is a republican party of the rockefeller wing of the

republican party, which were really moderates compared to contemporary republicans. so i think colin powell is somebody who republicans love to look at and uphold and say, you know what, this is such a great, great figure. he was secretary of state. he was chairman of the joint chiefs of staff. he's this role model. i think he would've had a tough time getting his own party's nomination. >> host: after barack obama was elected as an act, there was a sense that all things were possible, a lot of people felt there was that said a lot about the country and how it had changed and evolved. one year into his presidency, what do you see as happened in the country and has the country changed? >> guest: well, i think it's a mixed response in the sense that

the euphoria after november 4 has certainly receded in light of the enormous political challenges that obama has faced. but i also think there was a notion, which was erroneous, that donation had become a post-racial nation in the age of obama. in this notion of postrace was this notion that well, you know, obama's election proved that active racism was over and wasted matter anymore. but when we think about some of the pressures that the president is facing now, not just response is that the president that things like unemployment. the unemployment rate in the country right now is very, very high, 10%. the unemployment rate for african-americans is doubling in places like new york city for black men it's tripled. there is a great recent news stories about how we can african-americans were college-educated are disproportionately more unemployed than their counterparts.

so we're still seeing that even with the euphoria of the obama victory and how significant is that victory is, it's really a watershed in american history and world history. it's still not necessarily translating immediately into ending racial disparities in this country. >> host: some have criticized president obama, particularly of some of the african-american communities for not focusing enough on some of those disparities, particularly the record unemployment among african americans in some places. davidson concentrated attention. what do you make of those critiques. >> guest: well, i think they exemplify the dilemma that black americans face having the first black president. because historically we've never had african-american leader within the black community, someone like dr. king who also

had an elected office, that alone the highest office in the country. so when we think about obama throughout the 2008 elections, he became one of the most powerful black leaders in the country as the obama phenomenon evolved. right, he went from pulling behind hillary clinton to dominating in south carolina and really receiving over 90% of the black vote in the election in november. now, blacks are faced with the fact that he is just not the black leader. he's also president of the united states. the black leadership and this is everything from the congressional black caucus to black grassroots activists meaning that you really can't do on both parts of the same time. when he thinking about employment and unemployment, he's trying to think of universal solutions, whereas black leaders want him to focus, rightfully so, on racial

disparities. and they're finding it pretty hard and it's a unique situation in terms of party criticizes first african-american president who has enormous reserves of goodwill within the black community. i mean obama can go into any barbershop, in the black church, any place all across this country and he's going to be embraced. at the same time some of the same people embracing him are suffering. for the quandary that he staci and i don't think there is so far black leaders have showed the right balance on how to criticize the president in a way that has traction with the larger black community. >> host: he grew up, in part, in large part, and has embraced the whole notion that this is a multicultural nation and the possibilities of mull to culturalism. you write in your book that he sees black power as a kind of racial and accurate sound.

>> guest: absolutely. the president vision of black power really subscribes to the popular vision. in his memoir, he describes an older gentleman who serves as a mentor to him in a y. e. n. you would always be talking about this black power staff, as obama puts it. he also describes meeting black nationalist in chicago and that he listens to them very carefully, but at the same time, he feels that their view of the world is too narrow and too static. and it's an unchanging view of racial discrimination and segregation. at one point he describes listening to a speech by squirmy, the former stokely carmichael and the early 80's at columbia university and says that during a speaking and a woman asks a question and he says that the way in which he responds, you know, his eyes glow at the eyes of a madman or

sand. so obama's view of black power is really something that is anachronistic as something that is suitable for the politics of the 1960's and 70's, but is not flexible enough to take into account the changing racial and political demographics of our multicultural present. >> host: and yet he has opened the white house, made it available to people as different, you know, ideological and the wide range of activist spectrum, al sharpton, who is somebody who's been down to the white house. and at least in the popular imagination, be considered kind of a fiery black activist. and he is someone who has access to the white house and has been down to see the president. what do you make of how obama has handled -- then accessible

and how he's reached out to african-americans? >> guest: well, i think again this is complicated because on one level he's the first black president who hasn't necessarily have to do the same kind of outreach as his predecessors because he's so popular in the african-american community. i think one of the things were seen whether his jesse jackson or al sharpton are the congressional black caucus, they are all wondering how can they provide some kind of accountability for this president who is so popular within the black community. so 11 level, his accessibility has been fine. but this access equal pop a policy and this access equal power back and right now we think about black issues, that is a translated. there's been no discernible transformation in terms of the white house on trying to specifically address african-american issues, even though there is urban policy

outreach, but not the kind of dramatic public policy initiatives that i think some black leaders, especially people in the cbc were hoping for. >> host: where do you think we are in this nation with race relations? >> guest: well, i think we're really at a unique crossroads. because on one level, obama's victory can be attributed to millions of younger voters, white, black am a latino, multiracial spectrum, voters who are under 25, under certain who participated in the process for the first time in 2008 if you really looked at obama as just another candidate, who even though they might have their own individual racial hangups, they did it solely view that campaign and the candidate through the prism of race. at the same time, we have an older generation and we can get back to the harry reid's comments and older generation who still is coming to grips

with a multicultural, multiracial nature of this democracy. obama's victory is very, very important. the symbolism is very, very important. but it's also been exaggerated here it and it's been exaggerated in the sense of obama's victory equals the end of racism. obama's victory equals a post-racial united states. so there's one aspect of obama's victory that encourages a kind of mythology and mythmaking that the united states is completely turned a corner. and if you don't make it in this country is really based on your sole individual behavior and not any kind of racial institution of racism or any kind of racial discrimination or barriers. the positives to the victory or the way in which obama, as president, really delivers a different image of blackness, not only to the rest of the

country and globally, but also to blacks themselves, especially young black people. i mean, and think one of the best things about obama being president and we go back to that homily that you started with, with some barack could fly, barack so your kids could fly. the resonance that is going to have an african-american children and children of color, the white children, to, is right that we can't calculate. we're going to have to see. so that's going to be very, very important. you hope that resonance is connected also with public policy. because obama has a sociological cultural impact and anthropological impact, but is it going to be public policy impact, meaning isn't going to be an impact that we can quantify in ten or 15 years. because i think one of the interesting measures of a post about the united states, whether he serves one or two terms is what is the quantifiable

transformation, if any, that his presidency has on black people? >> host: one of the things, as you mentioned, is the nightly news, that they see a black family in place is, whether it's coming out of him without bond, whether it's playing with the dog go or getting ice cream, or with the girls. you see a portrait of a black man in the highest level of our other nightly experience as opposed to i don't know how nightly news is in your town, but it is a lot of crime in most towns. and so, that certainly has an impact in edgewise. >> guest: absolutely. i think one of the biggest things the election did in terms of transforming the ascetic of american democracy is projecting that consistent image of this intact, whole black family, the

president, first lady, michelle obama, the children, sasha malia, the dog come about. but even the grandmother, michelle's paternal -- her mother is in the white house for the first time since the truman administration. so that's been very, very, very important. and positive, but at the same time i would also argue that those images promote aspects of the kind of racial backlash that we've seen against this president, too. when we think about the 912 movement in this whole notion that the president is not a citizen and some other critics -- >> host: signs with like hitler -- >> guest: guess, were talking about criticism that crosses the line from just legitimate public policy differences into the basis racial stereotypes and racist caricatures.

>> host: what's next for you after this worked quite >> guest: well, i'm working on a biography of stokely carmichael. and so that's what i'm doing. >> host: that's pretty compelling. your students, what do they make of this. >> guest: well, i think they're fascinated by it. was very interested is now the college student to teacher at eight team to 22. many of them are born in the 90's at this point. this is way after civil rights act, the voting rights act, it's way after the death of martin luther king. this is really ancient history for them and their very fascinated by this. and many of my students really followed the election very closely, very intently, like students at all across the country and around the world. so i think race continues to be this important crucible for them to go through in terms to

understanding the history of this country in really understanding our democracy. >> host: do you think that this sets the stage for this election, sets the stage for more african-american to be elected president? is this something that can happen, you know, again and again or was this unique, the circumstances, the man, the moment? >> guest: well, i think it's both. i think it can happen again but i also think it's unique. one of the things we've seen is that another african-american candidate who would like obama, man or woman, potentially could win and could find. at the same time, can we get a black candidate who is considered very robustly dark skinned, who speaks in the cadence is that black community. can that person when? and right now i would say no

because they would turn off a large segment of the electorate. and i think that's going to be the true measure and test of our transformation is a democracy, when again, what reid was saying his support of politics of realism about the electorate is shaped when somebody again who is not quite and, who is not perceived as speaking as if he were not a black person could win an election. >> host: did you believe that a woman would be a lack did before an african-american? >> guest: you know, it seemed as if senator clinton was definitely poised. and when we think about women and from the country, they are definitely ready for them. so in a way seemed as if that would happen before an african-american, especially because before barack obama arrived on the scene, if we looked at the landscape of black elected leaders, the political

leaders, it didn't seem as if anyone was imminent, had imminent possibility of becoming president. >> host: we're just about out of time. but i want to say i'm enjoying this a lot. we are talking with peniel joseph, professor of history at taft university and has a very deep, complex but, "dark days, bright nights: from black power

he was a moral or an island in the 18th century, who wrote a book on moral philosophy first. and used to get a set of lectures that choo-choo for moral philosophy to economics and eventually wrote a very long book on economics, often for the founding text and inquiry in the nature and causes of the nation. and he's been extremely everson although as a philosopher i wish people would look at it more as a philosopher than just as an economist. >> we will get to that.

the proposal russell roberts at george mason university. what has been the impact of the wealth of nations? >> guest: teaching a lot of economics along the centuries was published in 1776 really saadi holds on for social science. the combination of empirical work, observation, logic, philosophy, all melted together. it's really an extraordinary work that ascendant norm if impact on scholars in the real world. >> host: professor fleischacker, when we talk about moral philosophy, what do we mean by that? >> guest: well, with which went by it was something close to a because social science in part. that is to say everything today recall sociology, economic, political science, all that would be called up moral philosophy as opposed to natural philosophy. now shofar lasciviously mutated good. but it also meant for him as it

does for a the study of whites at right and wrong, good and bad, what human beings are aiming for. and those things are part of his vision of social science i would say. so how groundbreaking was his word? >> guest: it was enormously influential as russell said. almost from the moment it was written, certainly by say the 1790's. it was being red all over. the prime minister of england as of the 1780's, william pitt had read it already in college, the founders of the united states, especially thomas jefferson and james madison were very much influenced by it and were looking to it for guidance as they shaped this country and then by the time of the french revolution was extremely important in france and germany. so in a lot of ways, and it was to go to but if you wanted to

figure out what government should do about the economy, but also what government should do in general. >> host: professor russell roberts, do you use adam smith's theories in teaching economics at george mason? >> guest: i do actually. his insights into the division of labor and specialization and trade effinger credibly timely. we are the only university i know that george mason is a field in smithian political economy. i hope to teach class and my colleagues. we take smith's quite seriously as a role model for a social science should be conducted here at >> host: what about you, professor fleischacker likes do you use pin in your classes? >> guest: i do but same story of political philosophy. an expected to teach some of the classics of the field, especially the field in the 18th century. so do regularly teach a course on scottish moral philosophy in

the 18th century that includes figures like david hume as well as adam smith. and i'd like to suggest two students that smith provides a quite remarkable model of how philosophy and social science can be run together. and sometimes look at his moral philosophy in connection with the wealth of nations and see how they interact. poster well, good evening and welcome to the special edition of the tv on c-span 2 in primetime. we will be light for the next hour, looking at adam smith, "the wealth of nations" and we want to take your calls, e-mails and tweets. so if you'd like to call in to work to guess, will play a little bit more about them in a second. if you like to call in with her to death and talk about adam smith and the wealth of nations, here's the numbers for you to call. (202)737-0001. (202)737-0002 for those of you in the mountain and pacific time zones. and you can always send us an e-mail at the tv at c-span.org

or you can send us a tweak twitter.com/booktv is our twitter address. now are two or samuel fleischer actor. he is in chicago right now and he is a professor at the university of illinois in chicago and he is also president of the international almond smith society. professor fleischacker, what is that society? >> guest: that was a society founded about that as a society founded about 15 years ago to encourage more scholarly interest in smith. one of our models was the hume society, which did help ratchet up interest especially among philosophers and david hume. smith is of interest to not just philosophers or economists as to intellectual historian to literary theorist, often these days. and we encourage the study of smith from all and no political perspective. but to say we try to stay away from the political uses of smith

for ideological purposes and simply encourage scholarly work on what he had to say in all these various areas. and we have compensated basically at least once a year and also try to encourage scholarly work and various other forms. postcoital mention david hume twice. who is he? >> guest: david hume is one of the most important philosophers most people would say of the postmodern. since about 1600. he was a radical empiricism, that is someone who try to develop a theory of knowledge and of morals and entirely on the basis of experience. that led them in certain ways to be something of a skeptic, raising doubts about the existence of causality, even of ourselves and serious doubts about religion. he was also adam smith's best friend and he preceded adam smith and writing interesting essays on economics and many of

his insights and five smith incorporates the system in the inquiry into the wealth of nations. host our other guest is russell roberts is an economics professor at george mason university you in the washington d.c. area and a research fellow at the hoover institution. he is a weekly podcast called econ talk. what is that? >> guest: an hour-long interview with economist, authors, the guy who sold me my car, an expert on and come anything i think is interesting, that's about the world around us and related economics including a six part series i did with dan klein and the theory of moral sentiments. a little bit intense, but for those deeply interested in more scholarly diversion than we usually do in econ talk. >> host: would you consider yourself a fan of adam smith's theories? >> guest: big-time. >> host: why? >> guest: is startling how something with somebody ago with such charm still educational invaluable. my thesis advisor kerry backer

won a nobel prize when asked, who would the economist is simplest him and he said adam smith and alfred mosher. we go back and read smith. there's so many insights there. any such a role model for how to use observation, facts, evidence and thinking about the world around us. >> host: before we go to calls, there's one phrase that adam smith is very well known for her, the invisible heat. we're going to take that from "the wealth of nations" and read the quote to you where he uses the phrase invisible hand, with a little bit of text before it and after. so it gets a little long hair, but we thought you'd want to see their perspective. and this is from adam smith, "the wealth of nations," book four, chapter two.

what does that mean? >> guest: , well, it means different things to different people. what it means to my understanding of smith in the world around us as he was trying out a tradition that was a little preceded good he was the first economist, but adam ferguson was also a scott, talked about things that were the result of human action but not human design. and they take that lineage, ferguson, adam smith, to hayek come in the great 20th century economist. they're all interested in outcomes that are beneficial,

sometimes harmful but usually beneficial that no one intended. you often think of the law of unintended consequences is negative and often is. with smith and hayek and ferguson were talking about was human action that creates an emergent order, not designed from the top down, but from the bottom-up by individuals making decisions based on the knowledge that they have actually have access to that no one else has. understanding that in my view of economics is the single deepest thing economists understand that isn't obvious or just common sense. it's profoundly deep, its new one, it's subtle, good caricature as if everything's going to turn out okay. that's not what smith understood to mean. smith also had a divine access to the invisible hand as the hand of the divine. he uses as a metaphor in this era of moral sentiments and he argues that people through their internal conscience and their worries about what other people think of them are led to do things that make the entire

society better off. it's a very deep and subtle idea. it's a beautiful idea. >> host: samuel fleischacker. >> guest: can i jump in for a second? i agree with most of what russell said. the exact meaning for the idea of the invisible hand is very contentious among smith's colors these days. some say it refers to the divine. smith uses at exactly three times in all his work and in one case it does clearly refer to the divine here in the wealth of nations many people and i would be among them would say there is no reference to the divine. it's just a metaphor that he is found useful elsewhere. whether there's any kind of religious background to his economic theory as i've said is a very controversial. i think russell's main point is the one to focus on here, whether there is or not smith gives us a purely natural secular account of how orders can arise about anybody

intending them. and for the most part, how individual action can for the most part pretty something quite good for society as a whole without people intending it. now one thing that smith has in mind, and this is the one thing i want to add to what russell said, is that he's opposed to the idea that what not to think that the society would be better in many cases if there were invisible hand. that is on the one hand, he thinks governments don't necessarily do a better job. in fact, usually a worse job in running economies. and on the other hand, he dislikes as he says in the last sentence as he quoted, he dislikes it when merchants claim to be doing something for the good of society. interestingly there is a letter smith wrote about the same time, about a year earlier and which he refers to josiah wedgwood, the famous founder of the pottery firm, claiming that he wanted a certain law, which was

actually going to benefit his firm for the good of england. and smith says in the letter essentially he'd much rather have wedgwood admits he's doing it for himself. basically smith doesn't trust merchants when they claim that they're doing something for the good of the public. he thinks it's better if they simply ask for their private interests. and if everyone does that on the whole, i guess russell said it's very important he doesn't think this is true in every case. on the whole win people to pursue their self-interest and a well-organized society they will do the public good. >> guest: i like that point about smith's words of people claiming to be serving the public good. it brings to mind the ceo of goldman sachs who recently was quoted as saying he does god's work as an investment banker making sure capital flows to its highest valued use. it's a lovely idea. unfortunately, the current system which is marconi capitalism than real capitalism usurps goldman sachs and masquerades to be serving the public interest.

>> guest: smith wouldn't even think it's so ugly. i think you would say it's quite typical. >> guest: smith understood on the part of the merchant or the business person to cloak itself in the public interest. and how dangerous it was. >> host: samuel fleischacker, give us a brief bio of adam smith. where was the race, where did he go to school, ephedra. >> guest: okay, i hope your viewers don't fall asleep in the spirit he is one of those boring lives of an important human being. his father died before he was born. he was born in a small town in scotland called kirkcaldy. he'd supposedly was kidnapped by gypsies and he was seven years old in the least a few days or weeks later. that's the most interesting thing in this lifetime. after that he went to the university and glasgow, got a special scholarship to go on to oxford. came back and taught in oxford.

he was actually professor which is back, and as some of the major intellectuals of the time. he was never a professor. ferguson was largely not a professor. and he took over the course of his own major teacher, francis hutcheson. after that he was hired by a rich noble men to tutor his kid and supported for the rest of his life on that money, even though he only tutored the kids for a couple of years. and then he retired to sit at home to write the wealth of nations. and funnily enough, after writing "the wealth of nations" in which he argues against duties of any kind, he became a commissioner of customs for about a decade here it and then he died quietly at home in scotland. her rich from various sources, although apparently he gave most of his money away quietly without telling anyone so he died without much wealth to his name. that's about it. >> host: russell roberts, did

he ever visit the united states? >> guest: i don't think so but you can verify that. >> guest: he visited very few places. he went to paris and met a lot of major intellectuals in france, matt voltaire which got a lot to them. but aside from that one trip to the continent and i think he traveled very much outside the british isles. >> host: list get to our viewer calls. (202)737-0001 for eastern and central time. 202-73-7000 to four pacific and mountain time zones and booktv@c-span.org for e-mail and the tv@booktv is our twitter address. rochester, new york. andrew you are on the samuel fleischacker and russell roberts. >> caller: thank you gentleman for coming out tonight. my question is, what about this mr. smith having something to say about a war tax. i heard there was a war tax in

the general washington had a war tax. i was wondering if you talked about what both his desire on debt and things like that. >> host: professor fleischacker. >> guest: well, there is a long black and complicated and very technical session of the wealth of nations devoted for taxes, very much as mired for politicians of the time. they took to see which taxes might be most useful. and in there he talks about funding of course quite explicitly. he talked about was called the sinking fund which was a kind of data system by which britain financed its worst. he complains about by way of financing for technical reasons and i'm going to leave it to russell as he wishes. and says that he would prefer if wars were funded by a tax paid in every war fought. one reason he says that would be advantageous as that would meet

the wars shorter. people would be irritated by paying the tax that would make them call for the war to come to an end. i'll leave it to russell to say anything else on this. >> guest: my only other comment for smith on taxes is he deeply understood who really paid the tax as opposed to the tax was supposed to be paid by. and he also understood the incentives that politicians and taxpayers dough with. and the sam's example of the pain of war being paid for in the contemporary time is a tremendous example of a smith was always aware of, which was how incentives work and effective of politics. >> host: gentlemen, we have a tweet hear from joe orlando. both men show he goes by and he writes, who cares? why should we care about adam smith? >> guest: well, as i said, i teach a class in microeconomics every year of top for about 30 years and is often assumed as most economists to the days of

day as ricardo insights into trader the right ones. diversity is a powerful trade. i've come to understand recently that actually said that perhaps the more important idea, which is the role that economies of scale on divisional labour have a specialization even when we're all the same. he has a lot to teach us though. it's not always easy reading. the first three of four chapters of "the wealth of nations" can be read by anyone today. >> guest: the first seven chapters. >> guest: okay, you're even more willing -- that's okay. the moral sentiment from his first book starts out slowly, very difficult to read but if you get into it it's all about her self-esteem, our self-worth come the tension between our self-interest and doing the right to. it's tremendously powerful but still very much worth reading and i went out again on trade smith's remarks on trade policy, his subtle and ironic understatement of self-interest

of merchants bactine often a claiming to be in the public interest, the wool of the politicians. still worth reading. >> guest: i would add two quick thoughts to that. one is smith decided of course vary widely by people for political purposes to this day. he decided as a moral source as well as economic source of the free trade and economy of what's called the punta arenas a more classical liberalism and then he is also cited by people more in the last. and in many ways, he has been the origin of ideas that are still very much alive in the political scene. and if one wants to trees how we've come to these ideas, our own heritage, our own history, how these ideas have come to be kicking around the political landscape, one really needs to read smith. the other thing i can say is is a founder social science and

this goes back to something russell said in the beginning of the program, he sets a model for how social science might be done. and this is a in which scientific observation is integrated with moral thought, in a way that isn't always true among bitter social scientist. in the nonsense i think it's very inspiring, with reading, was looking to as the model. >> host: harrisville, pennsylvania, bob. please ask your question about "the wealth of nations." >> caller: hello, good evening man. i'd like either of the professors to comment on the new relationship between adam smith and marx is on. and where would someone from the 20th century such as iron brand, where would she fit in regarding the philosophy is? thanks. >> host: let's start in chicago with samuel fleischacker. >> guest: well, many people who study marks point out that

for all he identified smith in large part with this system that he marx.he should be of a stronger was due to the past. he couldn't get away from admiring smith. he quoted smith as a very honest thinker and in fact incorporated some of the remarkable thing smith says about the suffering and oppression of workers as things that he himself could still hold. and in fact, there is a move now i should say even though i sympathize with assault for left-wing wing yousef smith i'm not a marxist. there is a move among many people who were very interested in marx and have a marxist orientation to the political economy to recover smith. all over the academy especially. there are many people interested in marx who are covering smith yet i don't see any relationship between them. i think there may be others who do.

i heard emphasis on self-interest only i think is quite alien to smith. i think it's a very different view of how economies work and how societies work. >> guest: i want to emphasize that as well. i think part of smith gets caricatured at the defender of creed. he's not a defender of creed. he was someone who understood the power of self-interest, but most of us put ourselves first. that's human nature. he took it as it was. he urged us in his first book to overcome that. he talked about how sometimes we do and sometimes we don't. the other part that i think is a brand in about smith is smith talks about the importance of happiness. and he talks about how it appears to him that the world was created for the happiness of humanity. and that's really an extraordinary idea. i think a lot of people learned from ayn rand that it's okay to fall your happiness for smith was certainly not a hedonist or libertine. he was a huge emphasis on the

importance of moral values and conscience and doing the right thing that i think is often absent from ayn rand. >> host: the first edition of "the wealth of nations" was finished in 1776. didn't play any role in the u.s. revolution? >> guest: well, as sam pointed out earlier the founders read smith. he did revise it and say one of the days. he revised it and i think 1782. quite a bit. "the theory of moral sentiments" came out in the 1750's and i don't know how influential it was. >> guest: jefferson had read "the theory of moral sentiments" by 1771. the president of princeton at the time of the revolution and before with a man named john withers and was a scots and he educated many of the founders. and they read what he as a scot thought was worth reading. witherspoon with the declaration

of independence and so forth. he that is "the theory of moral sentiments" was worth reading. i wouldn't say however that the "the wealth of nations" played a role in the revolution. what i it is playable and very clearly so as the debates of the constitution. people were reading it. many of the most important founders were reading it by the mid-1780's. they were looking at smith's of national banks. it was looking at his discussions of militias and standing armies. many aspects of the wealth of nations were very important to the founders and effects that give cited and debates of the constitution in 1787 and 1788. >> host: next call comes from john invalid taxis. his go-ahead. >> caller: yes, i studied "the wealth of nations" and "the theory of moral sentiments" when i was in college back in the 60's. and my professor insisted that she can't understand one without the other and i wonder -- i read

both books again in the last two years and i was amazed at how powerful it is, particularly through moral sentiments, he does a powerful job of explaining and reviewing all of the philosophy, plato, aristotle, and other philosophers. and he emphasizes the importance of the human behavior and then he goes on and "the wealth of nations" he talks a lot about the importance of savings and accumulation of capital and how many comes to be. he talks about the colonies and he talks about the indy is in the colonization. the point of all this is when you read it, you realize it's still relevant today and i wonder to what extent our students and our legislators have studied this enough to really understand. because it's relevant it seems to me to what is going on today.

and i guess my question is, how do you think this all relates to what we're seeing today, particularly with what we've done to our money and what's going on with the financial dealings. >> host: thank you john. john, why did she pick it back up and read it? what was your curiosity? >> caller: while i was an investment banker most of my life. i've been around investment banking for most of my life. and as i've been corrected. and i wanted to pick it up again and i'm naturally interested in philosophy. and i just started rereading aristotle. i picked up "the theory of moral sentiments" again and adam smith is so clear in his explanation and he compares the philosophies and the consequences.

>> guest: well, one thing we haven't talked about and "the theory of moral sentiments" which is so important to avoid the character of smith. he explicitly says the accumulation of wealth doesn't make you happy and he wants against it. and he also talks in a modern way about gadgets and how richmond will sell their pockets with gadgets. and they didn't have blackberries and i found them. they're too thick holders and other things other things that he mocks as a source of happiness and prestige and says they're not real. he says the book is full of important borland section that i think as you point out they have to be right together. i think was smith saw that is so important is the culture, the role of conscious, the role of trust and making it a market system work although his market system is very primitive compared to ours. so the other thing i want to mention, we've talked about how is a role model for social science. a lot of deep insights into the real side of our lives and the

economy that are easily forgotten. common fallacy that people subscribe to that smith understood centuries ago were wrong. his whole attack on mercantilism, his whole attack on the idea that exports create wealth in imports are bad. he understood in 1776 that was a flawed and fallacious idea. he understood money, the pieces of paper in the golden solver want a real wealth. real wealth came from what we produce. he understood the moral sentiments is what gives us happiness and how we produce it and spend our time, not to be spending our time at the office. i mean, he's a profoundly inspiring thinker and both his insights and his moral instruction. >> host: professor fleischacker. >> guest: i think it's wonderful that he studied both "the theory of moral sentiments" and "the wealth of nations" in college. that doesn't happen today and i wish it would happen more often. i agree with pretty much everything that resto said. i would decide this midsize them

"the theory of moral sentiments" his conversation with friends. it sociability, if having friends and hanging out with them basically. he doesn't use that phrase of course but he does talk a lot about conversation and that is the greatest source of happiness and that's one of the reasons why morality is essential to happiness. because much of a certain level of decency won't have any friends. and in that understanding, it's very clear, this is something so interesting, such an interesting irony about economics that material goods are not central to happiness. anyone who seeks material goods at the cost of friendship and morality is making a huge mistake for smith. an msi think he provides something that i think we can easily look back too. here's a man who praises the free market, who is not opposed to the relationship of material goods. the main reason he wants countries to be wealthy and he says is quite explicitly is that he wants poor people to be able to have enough to beat and of

clothing on their back. the most important as he often calls on us. he often says her food, clothing and lodging. they are abbreviated by sco in his notes as often. material goods are important. he sees the role for them. he sees the wall for them especially in helping people rise out of poverty. that they are not the goal, not the ultimate goal. when you read the two books together you really can see that clearly. >> guest: smith says man wants to be loved and to be lovely, meaning we care deeply about how others perceive us and we want to win my respect honestly by being lovely, by doing the things that engender love. and i think what sam points out, which is extremely important, is often people, even economists, forget what the purpose of economic says. it's not about accumulating material well-being. while this important as misunderstood to help people survive, to live long, extremely important.

but it's only a part of the story. in economics, people think about the stock market, interest rates. it is about those things but as a student told me once after she went from her teacher, economics is a study about how to get the most out of life. it's better choices, the fact that we don't have an infinite amount of time in an amount of money and we accuse our time which is so precious. and not merely accumulating material goods. in that sense, economics is to come back to smith and not be as focused on the material. and i think it's useful people understand that's an important role in economics. >> host: here's a quote from "the wealth of nations," book three, chapter three, part 3.

>> guest: well, that's a bit misleading. i think it might tend to encourage you to think that making stuff is the road to prosperity. that certainly didn't say that. what he believed was that our skills should be used as widely and successfully and productively as possible. and the way we do that is through our free choices of buying and selling and specialization and choosing what jobs to do, et cetera. but i think he is referring in that passage and maybe sam knows this better than i do. i think he is referring to it as comparing a semi-modern society fails dinners with her son manufacturing to a more primitive hunter gatherer, even agricultural society. is talking about the natural transition he saw from hunter gatherer to a role where artifice, with the making of stuff became a way for people to use the division of labor. a famous example in the opening of the back of the pen factory, where an individual by cooperating with other people are specializing and not trying to make the pins all by oneself could produce an enormously larger number of pins per

person. it's really a deep understanding of productivity and how productivity is enhanced by exchange. >> guest: if i could just pretend for a second. the quote from book three i agree is misleading and affect radically so in a way. it's actually part of his polemic against the mercantilist theories that manufacturing is better than agriculture. one of the main points of the wealthy nations of the whole is to say manufacturing is in better than agriculture and agriculture is in better than manufacturing. a country should do whatever is best suited for or rather the individuals in the country. if you leave them alone to find her unemployment and this fits with what russell was just saying, will naturally seek the kind of work that is remunerated, which means basically the kind of work that's most needed by the society.

so the government doesn't need to promote manufacturing of the cost of commerce -- sorry, manufactured at the cost of agriculture or agriculture of the cost of manufacturing. and then they stomach a technical point, but in the context of the day, where there were many people who thought that the job of the government was to promote the kind of industry that makes country's richest. and some people thought that was manufacturing and somebody was agriculture. smith says no, leave industry alone. let people find the road work and that will be the best way to promote wealth. >> guest: that idea which was popular in smith's time is still very much alive today, where people think we have to pick and choose the right activities. ross perot said it better to make computer chips and potato chips. that's true if you're good at computer chips. if you're not you're going to get even poorer doing something are not good at. >> host: adams this important new compared to john maynard keynes, milton friedman.

>> guest: well, they stand at the shoulders without trying it. they are hayek and friedman more than keynes, but i'm sure came with himself is in the same tradition. >> guest: i mean, one difference between smith and the others is that none of the others that you mentioned fall themselves as a moral philosopher as well as an economist. this sometimes a very interesting things to say about morality and about moral philosophy in certain ways. but smith's views i think it's a great the study of human nature from a philosophical point of view with a study of human nature in a more empirical way, more than the others do. let me just say a word about that if i may. which also pertains to this question of how you read the wealth of nations and "the theory of moral sentiments" together. there's one thing that we haven't mentioned that i think we might want to adhere. and that is in the "the theory of moral sentiments," he makes

clear that in order to understand other human beings properly, to sympathize with them as he says, we need to imagine ourselves into their situations. and we need to do that in great detail. otherwise we will really appreciate what they're experiencing. and he uses that idea throughout "the wealth of nations." in a particularly he imagines himself in the position of poor labor is a great deal, which he consider role number of later economists in bother to do. but i think as part of what i need when i refers to smith is having this model of how you integrate philosophical thinking about human nature with empirical study. and i don't think that is so true for some of these later figures, although they are very important also in their own ways. >> guest: the argument of course that adam smith are living at a poor time to milton friedman or hayek or can't. he was less specialized. and one of the great aspects of

economic growth is at school and specialization. into of course those guys were narrower. they were pretty diverse for economists, all three of him. >> host: j. in hurlburt, florida. thank you for holding on. your run with fleischacker and russell. >> caller: thanks for taking my call this fascinating subject. i am interested in the wealth of nations as an exercise in social science and i've taken sort of a casual interest in adam smith for years, yet i've not read the book. so my question is, who explains smith better than smith? is there one volume a clear and accurate analysis or interpretation of what he was communicating and if so, what is that title? post a all right, we'll start with professor fleischacker. >> guest: i hate to set you on that road because it is worthwhile reading smith. russell said before, just the first through four chapters of "the wealth of nations" i said

for seven you could try reading that and maybe just say the first couple chapters of part -- part 4 of "the wealth of nations" which includes the famous invisible hand chapter in the book of five. that would be very useful. i was introduced to smith for his ninth goal by a book on the great economist and i found that a fairly good, clear summary of what smith have to say. i think it's probably out of date by now and somebody will probably take it to be biased. there's a man named dede buffy l., who has a least one book, i think to book entitled adam smith which will give you a pretty good summary, very clearly caused and it's very sure. so i guess that's what i'd recommend. >> guest: i would recommend of the library of economics library you can find the entire "the

wealth of nations" and the entire "the theory of moral sentiments" available at no charge searchable and it's a lovely and very inexpensive way to get access to the man and his ideas. you'll also find an essay there by samuel fleischacker on deep insight of smith and treating people in a very egalitarian way. it's a great essay by sam. he points out that smith unlike most of his colleagues of the day actually thought the poor people knew what was best for them. that he was mentally paternalist. he recognized that every human being had knowledge that other people didn't have. and as a result of the best judge of was best for their own interest. it's a very radical idea surprisingly and to change the world. >> host: who promotes adam smith for these days, republicans or democrats? professor fleischacker. >> guest: that is changed quite a bit over the past 20 years. i confess my interest began just about exactly at the moment of the fall of the berlin wall. it began shortly before i should

say. but i think that were a great number of people and mostly rather left-wing academy who thought marx is dead, what should we read now? and quite a few found smith. in fact, this is also happening to the political world. gordon brown, the prime minister of britain, even when he was chancellor of the check is a very profound reading of smith. i've been told that barack obama is also reading smith coming out of the university of chicago is an be surprised. so i think at this point of falling people on both sides of the aisle quite enthusiastically quoting smith, though sometimes for different purposes, which actually takes us back right to the smith's own time when people on both sides of many issues including some of the same issues we talk about today cited smith heard the >> guest: well, i agree with what sam said but i think republicans may claim to smith

unfortunately because the use rhetoric that they think is smithian about markets, competition, they often don't live up to it which i think is a great tragedy. i like to see politicians internalize those lessons rather than just use rhetoric for covering up self-interest. >> host: bill in fort lauderdale, good evening. >> caller: good evening. thank you for taking my question. i was interested in finding out some of the professors, essentially how john maynard keynes might've influenced in specific areas. i know that today consumerism is a result of dr. keynes. and i was wondering if they have any comment on that. >> host: professor roberts. >> guest: keynesian and can't himself was worried about saving too much and not spending. i do think that the mistake although many people would disagree with me. a lot of people think of zimmer

is the described it as the foundation of economy. that certainly is not a smithian idea. the part that is smithian is perhaps keynes interest in animal spirits. emma keynes meant by animal spirits is if you team. he meant the emotional aspect are the worries and fears. smith had a lot to say about that. smith was very interested in how people were often overconfident about their prospects for success are cautious or fearful about the future. and perhaps keynes was influencing. but other than that not so much. >> host: from book four, chapter eight, consumption is the sole end and purpose of all production in the interest of the producer ought to be attended to only so far as it may be necessary for promoting that of the consumer. >> guest: go ahead. >> guest: that's one of the tidbits in one of my pet peeves that gets quoted a lot out of

context. as a smith wanted to say, always too consumed as opposed to say and help other people which smith certainly didn't believe. in context, that's again part of smith's polemic against merchants who want the government to help them. in particular, we want to help them promote certain colonial policies by which for instance the colonies can only buy from british manufacturers. to that, smith is saying, listen, the consumers are working out, not you manufacturers. the government shouldn't be out to help you produce more. the point of production is how for the consumer. in that context he said government should be looking for the consumer needs and not to what the producer claims that he or she needs. >> host: daniel, manhattan, you're on the air. >> caller: our current political discourse in economics, you know, discourse, smith is received upon by antigovernment voices. weren't the governments around at the time -- weren't they

monarchies? and what their monopoly monarchies? i do want to offend anybody, but mafia invasion. >> guest: you're onto something there. other smith did in the liver time of a lot of tierney, but of despotism and a lot of plunder by monarchs and others. and as a result he was very concerned about the power of the state and certainly the democracy that he was living in at the time, parliamentary democracy. he was worried about it there as well. you're right. i think it's important to remember that the context of the time he lived that was part of the reason he was antigovernment. more importantly though the reason he was antigovernment to the extent he was, he certainly was an anarchist by the way, you certainly viable for government and defense, and the court system and sometimes in other areas. but his worry was aware that we should all have at all times, which is the concentration of power in the incentive for politicians to do the right

name. that's always a genuine concern. >> host: samuel fleischacker, what did adam smith think about the east india company? >> guest: he hated the east india company. he thought that was a huge mistake, one of the worst things the packet happened is to have merchants will warblers become merchants basically. he goes merchants have an interest that is quite different from the interest of the citizens. and so we actually wanted to disband it and that's one of his major recommendations in "the wealth of nations" and quite a shame, something of a betrayal of his legacy that even his friends kept the east india company going after he died. let me just say in connection with what russell just said, i agree with all that. i infected even out in the context smith is also worried about the king corrupting the democracy because he was capable of buying out the voters in many places. i would say that here,

libertarians who use smith to cry against big government do have a point. i think whether you're on the left or the right, when did you learn from smith is that government can't solve all our problems and some of the reasons for that don't have to do with the faults of monarchy. one thing smiths has often been one thing that i confess i have come from a more left-wing background have learned from smith is that governments just don't know the right kinds of things to run large economies, to run things in small local situations. you just can't trust anchors of legislatures in a centralized office in the middle of the country to know what's going on all throughout the country better than the people known themselves good as smith says, ordinary people can judge better in the realm local situations than any legislator can do for them. and i think that is a very important kind of message. it doesn't draw the will of government. government can do important

things. but one has to ask oneself always comes should government do this, could this be better done by the private sector. that is something smith always does want you to ask. >> host: bland, massachusetts, good evening. >> caller: i just finished reading transport in a one volume paperbacks there is a technical question for either gentleman. it's 1218 pages and not volume. would "the wealth of nations" suffer at all if the entire disposition on silver were removed? thank you. >> guest: there were a lot of passages in smith that are hard for moderns to read you when i said you should. the first report chapters as a minimum. a lot of smith is difficult to read because he is dealing with economic issues or institutional details that are relevant to us today or were not familiar with. it can be very difficult going. to me what is striking is for a book written in 1776 how much of it is still worth reading.

but i think the wise reserve is not a scholar of smith, assam is, and that would include me when going back to the book would have been worth more juice dishes and profitable. >> guest: i think a good excerpt could be put out. i have a thing when i like because they think they often leave out some of the important things about workers and public schooling and religion in book five. the disposition of the digression on silver i agree with the collar is the first thing i think most people would want to cut out. on the other hand, i gather that it's one of the things that modern economists think is most really be done and actually makes an impressive 20. this guy was pricing silver over 400 years, quite a remarkable feat, even with modern scholarship, but alone with what he had available to them at the time. in order to prove that the price of silver does not inevitably decline as his mercantilist opposition sided and i think it

is a pretty good job of it though i can't really judge the technical details. >> guest: i would just that they think it's it's important for any reader or an economist not just adam smith to be skeptical of the conclusions that are drawn. a lot of times they're not always right. smith was right about everything. he wasn't always -- it doesn't come from out finite, "the wealth of nations." it's not scripture, the profoundrovocative and intellectually progressive work. you should take many things in there with a grain of salt to learn from it. >> host: the addition we have here in the table is the fifth edition, which is published in 1789. he made revisions throughout the five editions. but this is in the public domain right now, correct? anybody could publish this book? >> guest: about twice a day of extraordinary high-quality version. it's not a knockoff. >> host: anyone can take it and added it in anyway they

choose to? gusto i think that's true. >> host: silver spring, maryland. >> caller: hello. i just want to ask a question. i read it, but what is the most important time of a simple economy? how is he going to -- >> guest: is a comment intrigue of older thinkers that work doesn't apply anymore, it's outdated, smith didn't anticipate derivative, for example, or credit default swaps or worldwide investment banking and that's true he didn't. although we had many things in a statement at some of the flavor. that's why you don't want to read smith for explicit understanding of things. nobody could understand, many, many things he understood for timeless. he understood the ball of human nature. he understood our flaws. he understood our highest aspirations of nature. he understood the