brilliant political strategist who is not a local and national political organizers, and who is not really one of the most important figures of the postwar period. >> host: and as you note, back in the '50s he was probably the most important political grass-roots political organizer transit absolutely. malcolm x is released from prison in 1952 after serving really six years in prison for burglary. he transforms himself from malcolm will that malcolm x while in charleston prison in massachusetts. he comes out of prison and he works in number of different odd jobs while also working as a muslim minister. in 1954, he is opening up the mosque in philadelphia, but he also becomes the head of muslim in harlem. and right away, malcolm becomes the key muslim black muslim

figure in the entire crew. the group grocery group that has several hundred when he joined in early 19, late 1940s, early '50s to having over 25,000 by the time he leaves the group that but what is important, between 1954 and 1964 would usually has most active in the group, he leaves the nation of islam by 1964, he transforms that group from a sectarian group to a secular group that he really transforms a group that is not on anyone's radar to a group that is considered by the fbi to be one of the leading subversive groups in the country. by 1959, there's a mike wallace documentary newspeak, five parts in the summer of 1959, that he produced that makes malcolm in the nation national and international figures. >> host: who is lomax? >> guest: he is the key african-american reporter of the 1950s and '60s before his

untimely death is one of the key black journalists who interviews now, but also becomes an expert on the nation of islam. >> host: one of the things about malcolm and all those things are true that you said, that there was a kind of raw language that bush is kind of a searing, piercing, he would say these things, here's something, you know, a quote in a prescott and he was somebody thought that american democracy was just not equipped to protect black americans, and that was not made for african-americans at the time. at a press conference in washington, d.c., he said that anyone set the dog on a black man, the black man should kill that dog, whether it is a four-legged dog or two like a dog. that's hard to say in public. i'm sure at that time, and just

maybe you could kind of put that in perspective. even today, we don't get, you know, important african american leaders standing up and saying something like that transit absolutely. one of mauka's most important characteristics was the ability to speak truth to power. and he's 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 proactively enough in birmingham, alabama. was was interesting when we studied malcolm x and look at them is that balko really serves as a counterpart to king, but in a way that people usually don't think a. they think of him as a counterpart to team as the good black men and malcolm is the bad, nasty antiwhite black man. know, knock him as a counterpart saying things that can get saved very boldly in a very

confrontational manner. but that actually give the king room to negotiate and give not just him but also one welcomes of the naacp and whitney young of the urban league to negotiate. because people are looking at malcolm as big so extreme because of his robust criticism of american democracy and american politicians, but also gives the politics of white supremacy that it gives these other civil rights leaders room to maneuver. 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, a genius writer of the 1960s and 70s has often said that malcolm had such a beloved for african-american people that he spoke to them in the language that they understood that one of the reasons malcolm was able to so effectively communicate with african-americans is that he was really from the black working class. malcolm had been hanging out with hustlers.

he was in roxbury. he was in detroit that he was in harlem. before he becomes a muslim mosque minister in harlem, he was selling people illegal substances in harlem, right? so malcolm knew how ordinary everyday people in harlem don't come how black people felt. he knew how african-american culture in barber shops and 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 important figure but not just do some kind of prophet of rage or some kind of icon. he's actually an important grassroots local organizer, not just in new york but in detroit and chicago and in other places as well. >> host: and long after his death, he had become enough of an american figure to get a postage stamp. >> guest: certainty that there is certainly a rehabilitation of malcolm x that has occurred over the last, let's say, 20 years

that we start with spike lee's film, malcolm x in 1992, the reissue of the autobiography of malcolm x and even the standard but even barack obama and barack obama's autobiography, dreams of my father, he says that he admired mao comes self determination ability to re-create himself. so when we think about malcolm x, he is the quintessential self-made african-american man of the postwar period. >> host: and embraced regardless of where you lie on the ideological spectrum, i am reminded that justice clarence thomas also embraced a malcolm x and had the collected recordings of malcolm x and found something important and malcolm x threes himself transit absolutely. i think conservatives really admire malcolm x's notion of bootstrap pulling.

pull 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, right. .gov and the nation of islam in their parlors refuse handouts from the white men in their parlance. so conservatives would deftly find out something that was a great attribute of. >> host: and other important figure in your book that you devote considerable space, chapters, stokely carmichael. >> guest: stoking the carmichael at least one the most important african-african american pluto activists of the postwar period or conservative civil rights and black power period. 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 really one of the only black power figures who had also been a civil rights organizer in the deep south. he is from the caribbean. born in trinidad june 29, 1941,

immigrants to the united states two weeks before he's 11th birthday in 1952. he lives in the bronx. is one of the only african-american students who test into bronx science high school in 1956. and that is one of the most prestigious high schools in new york city, even as a high school student, he is an activist. my 1960, he enrolls at howard university and joined the nonviolent action group at howard, which is a friend of sncc, an affiliate of the committee. and really at 19 years old, stokely carmichael becomes a freedom rider, goes down south and is arrested in mississippi and spend 49 days in mississippi's worst prison farm. and he really celebrates his 20th birthday in prison for civil rights activity. that's going to be the first of 27 arrests between 1961 and 1966. what's important about stokely carmichael that i try to convey

in this book is that carmichael is one of the few americans domestically during the 1960s who actually believes for democracy. what i mean by that is undergoes a physical terror and violence at the hands of hate groups and really domestic terrorists in places like the mississippi delta, and last count alabama, and cambridge maryland. in washington, d.c., to promote voting rights and citizenship rights for all african-americans. >> host: i want to get into, we're getting close to our break time. i want to get into some contemporary thoughts and get your opinion on what's happening now in the current scene, but we will 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 up. >> host: welcome back to booktv's "after words." we are talking with her fencer peniel joseph, tufts university

professor. and has a very interesting book, which i recommend, "dark nights, bright nights: from black power to barack obama." it's a great piece of work, and congratulations to you. >> guest: thank you. >> host: let's talk a little bit about you mention 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 had not been as sharp coverage come not as sharp and precise as it should be. tell me how you think obama as the first african-american president has been covered. >> guest: well, i think he has been covered in unique and interesting ways. i think in terms of politics of race, race is always shadowing,

contouring his 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 undress raise as president of the united states, how the media has really, really read the speeches in ways that differently than i would. for instance, there's an naacp speech that the president gave last year in 2009 celebrate the 100th anniversary of that civil rights organization. and in that speech he does a couple of things. one, he critiques african-americans who are doing the right thing, people who aren't taking care of their kids, not 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, and rollcall of civil rights activist. but he talks about criminal justice system and the racial

disparities there, and it's a well-balanced speech. what is interesting is the reporting afterwards just, well, obama tells black people to get their act together. so what's interesting is the media, when the president is talking about race, the most interesting aspect that they find is if he is chastising african-americans. and that's what happened during the campaign as well. i think that produce some tension between jesse jackson and then senator obama. another example in terms of race was the skipper gates incident and cambridge and the president said that cambridge police department had acted stupidly. and immediately, the media came down on him and sort of siding with african-americans. more quote unquote showing his true colors, meaning he was definitely up partisan piggy deftly was on the side of the black vote that because remember, then senator obama grunts as somebody who is above the fray, somebody who can be an

honest arbiter or umpire in terms of race matters, even though he happens to be black. and probably the greatest example of obama as umpire is the famous race speech in march 2008. that was the speech that the president made while he was still a senator when his association with the trinity church is a 20 year association with the trinity church in chicago and its pastor, jeremiah wright, threaten to be real his candidacy, because bloggers had gotten videotape of jeremiah wright basically harshly criticizing u.s. domestic and foreign policy. and they said if this is obama's preacher, then obama must share these same beliefs. so what obama did was give a very, very good speech on race that was perceived as being extraordinary. and he basically said, he parsed very, very well. he said on one level he disagreed with right, but on

another level he could understand what right does come from. so on some levels criticized whites and blacks equally. >> host: but ultimately had to cut his pastor lives. >> guest: yes. >> host: and ultimately apologized for his choice of words during the gates episode. i do think he has handled these controversial moments that you just cited? >> tracy i think he has handled it as best he can in a sense as the first black president, he is forced out of necessity to tread lightly on racial matters. and he did this as a candidate, too. he would say on one hand that yes, america had this history of racial slavery, this awful history of segregation. but on the other, he was a prime example of the progress that had been made. another great example is the three times he mentions race during his inaugural speech. he talked about those of us who

have felt the lash of the whip in the inaugural speech. so 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 his 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. and he imparts a real lesson onto the body politic. but for the most part, he has tried to stay away from racial matters, which is very impact on the african-american community, especially in terms of public policy. >> host: there was a recent flap that was disclosed in a new book by two journalists called game

change, the book, which revealed a private conversation harry reid had, the senate democratic leader, essentially backing obama up and saying this was an attribute, calling him the fact that he is light skinned african-american and did not use negro dialect unless he wanted to. and it was a lot of back and forth on that over the weekend. what you make of that, that comment, and the controversy that spurred? trendy i think it shows the complexity that traneighty face when they are trying to judge the sincerity of even their supporters in terms of harry reid politically, is not a right

wing politician. is a democrat. he is one of the people who is pushing healthcare. he was neutral initially during the campaign, but they went obama became the nominee he was a supporter and now we know in this book behind the scenes he was a supporter who wanted obama to run. and so on one level we can think of harry reid as someone who even though he is a great admirer of obama he still had his own racial issues. in terms of the way he perceives black people. and he is really coming out of a baby boomer generation, this notion that obama is light skinned and not speaking in negro dialect. even the term the go, right, is a very antiquated term and it certainly is pretty black power term. so i think it just says that when we think about our politics, that race still matters that even people who publicly will proclaim that it doesn't, privately their words

show something different. >> host: the suggestion i guess was that him being light skinned, that 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, 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 is? trendy they are saying he is closer to what mainstream white america would find acceptable. and that he is not a typical black person that i think that's what they're saying. i think it's very interesting reid comments because they were saying, said within the context of the support and they 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. if barack obama has run a good campaign and south carolina. so the inference there was, or leaves the inference taking 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 these estates in american history, the black candidate never wins. you have to be a candidate who happens to be black who wins, right? and obama is really fit the script and became this phenomenon. tragedy is he the only african-american to get elected president? was he the only person on the scene who could have gotten elected president? >> guest: i think so. in certain in certain contexts we did say he leapfrog over certain people. somebody like harold ford junior was considereconsidered an up and comer. >> host: who is considering

running for senate. >> guest: yes. was interesting about the democratic party in 2000, 2004, back to back they gave these bright up-and-coming african-american men the keynote address. the first black person to do a keynote address was george in 1976 but then back to back in 2000 in los angeles, this was a convention by the way that barack obama could not attend. he tried to attend but he couldn't get into it he couldn't even get credentialed. by 2004, his fortunes had changed and he gave an extraordinary speech there that catapulted him really to the senate because he wasn't a senator even when he gave the speech. and into the white house. i would suggest, that he was the only person in that context who could have won. >> host: colin powell, who declined to run in 1996, with someone who polled really well. was he someone who could have been elected president of this

country? >> guest: i think colin powell would've had a tough time getting his parties nomination. because colin powell is a republican who is much more a moderate gain of a kind of a republican that is now a lost art. and i think of people like nelson rockefeller. there's a republican party of rockefeller, the rockefeller wing that the republican party which were really moderates compared to contemporary republicans. so i think colin powell is somebody the republicans loved 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 has this role model. but i think he would've had a tough time getting his own party's nomination. >> host: after barack obama was elected president, there was a sense that all things were possible come and a lot of people felt there was a great

euphoria. they said a lot about the country and what it had, how it had changed and evolved. one year into his presidency, what do you see has happened in the country, and has the country changed? >> guest: i think it is a mixed response by the country 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 the nation had become a post-racial nation in the age of obama. this notion of post race was his notion that obama's election proved that active racism was over and race didn't matter anymore. when we think about some of the pressures that the president is even facing now, not just responses to the president, but

things like unemployment that the unemployment rate in the country right now is very, very high, 10%. but unemployment rate for african-americans is doubled. in places like new york city for black men it is tripled. there are great recent news stories about how even african-americans who are college-educated are disproportionately more unemployed than their counterparts. so we are still sing that even with the euphoria of the obama victory and how, as significant as that victory is and it is really a watershed in american history, of world history, it is still not necessarily translating immediately into ending racial disparities in this country tried to some have criticized presidenpresident obama, particularly some in african-american communities for not focusing enough on some of those disparities, particularly the record unemployment among

african-americans in some places. gives it some concentrated attention. what do you make of those critiques? >> guest: i think the example by the dilemma that black americans face having the first black president. because historically, we have never had african-american leader within the black community, someone like a dr. king, who also had an elected office, let alone the highest office in the country. so we think about obama, throughout the 2008 election season, 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 dominate in south carolina, and really receiving over 90 percent of the black vote in the election. now blacks are faced with the fact that he is not just the black leader. is also president of the united

states. so black leadership, and this is everything from the congressional black caucus to activist, need to exert pressure on this black president, meaning that he can't done both had at the same time. what he is thinking about employment and unemployment, he is trying to think of universal solutions. whereas black leaders want him to focus rightly so, on racial disparities. and they're finding it pretty hard and it is a unique situation in terms of how to criticize this first african-american president who has enormous reserves of goodwill within the black community. obama can go to any barbershop teamed in a black church, and it was all across this country and he is going to be embraced to get the same time some of the same people them are suffering. so the quandary that he is facing, i don't think so far that lack leaders have shown 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, a large part in a wide, and has embraced the whole notion that this is a multicultural nation and the possibilities of multiculturalism. you write in your book that he sees black power as a kind of racial. >> guest: absolutely. the present station a black power, it really subscribes to the popular vision. in his memoir he describes an older gentleman who serves as a mentor to him in hawaii who would always be talking about this a black power stuff as obama puts it that 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 is an unchanging

view of racial discrimination and segregation. and at one point he describes listening to a speech by the former stokely carmichael, by the early '80s at columbia university. and he says that he is speaking at a woman, asked the question and he says that the way in which he responds, his eyes glow of the eyes eyes of a madman. so obama's view of the black power is really something that is anachronistic, something that was suitable for the politics of the 1960s and 70s. 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 available to people of different, you know, ideological and the wide range of spectrum, al sharpton

is somebody who has been, and somebody at least the popular imagination being considered kind of a fiery, black activist. yet he is someone who has access to the white house and has been down to the president. what you make of how obama has handled accessible and now he has reached out to african-americans? >> guest: i think him again this is complicated because on one level, he is the first black president who hasn't necessarily had to do the same kind of outreach as his predecessors, because he is so popular in the african-american community. i think one of the things were seen whether it is jesse jackson or al sharpton, or even 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? on one level i think it's

accessibility has been fine, but does access equal public policy and is accessed equal power? and right now would we think about black issues, that hasn't 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 out reach but not the kind of dramatic public policy initiative that i think some black leaders, especially people in the cbc were hoping for. . . 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 >> who still is coming to grips with the 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, and it's been pang rated h the sense of obama's victory equals the end of racism, obama's victory equals a postracial united states. there's one aspect that encourages a kind of, a kind of mythology and myth making that the unite has complete -- united states has completely turned a corner, and if you don't make it

in this country, it's based on your sole individual behavior and not because of any kind of racial discrimination or barriers. the positives to the victory are 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, i think one of the best things about obama being president and we go back to that homily that you started with so, you know, barack could win so your kids could fly, the resonance that this is going to have on african-american children and children of color, but white children too, is right now 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, an anthropological impact, but is it going to be a public policy, an impact that we can quantify in 10 or 15 years? i think one of the interesting measuring of a post-obama 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 that the nightly news that to see a black family in places whether it's coming out of the, on the south lawn, whether it's playing with the dog, bo, or getting ice cream with the girls you see a portrait of a plaque family in the -- black family in the highest levels of power as a nightly experience as opposed to i don't know how nightly news is

in your town, but it's nothing but crime in most towns. so that's certainly has an impact image wise, i would think. >> guest: absolutely. i think one of the biggest things obama's election did in terms of transforming the aesthetic of american democracy is projecting that consistent image of this intact, whole black family. the president, the first lady, the children, sasha and malia, the dog bo, but also even the grandmother, michelle's mother is in h the white house for the first time since the truman administration. so what's -- that's been very, very, 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, when we think about the 9/12 movement and the birth movement and this whole notion that the president is not

a citizen and some other -- >> host: signs with a face like hitler and moustache. >> guest: absolutely. we're talking about criticism that crosses the line from just legitimate public policy differences into the bayist racial -- basist racial stereotypes. >> host: what's next for you after this work? >> guest: well, i'm working on a biography of stokely carmichael, so that's -- >> host: pretty compelling. your students, what do they make of this period, you know? >> guest: well, i think they're fascinated by it. what's very interesting is now college students that you teach are, you know, 18-22, many of them are born, you know, in the '90s at this point. this is way after the civil rights acts, the voting rights acts, it's way after the death of martin luther king, this is

really ancient history in quotes for them, and they're very, very fascinated by this. many of our, my students really followed the election very closely, very intently like students did all across the country and all around the world. so i think race continues to be this important crucible for them to go through in terms of understanding the history of this country. and really understanding our democracy. >> host: do you think that this sets the stage for, this election set the stage for more african-americans 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. i think one of the things we're seeing is that another african-american candidate who was like obama, man or woman,

potentially could win and could run. but at the same time can we get a black candidate who is considered very robustly dark-skinned who speaks in the cadences of the black community, can that person win? right now, no. 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 as a democracy when, again, you know, what reid was saying, and reid was saying in support, just really the politics of realism of how the electorate is shaped when somebody, again, who's not light-skinned, who's not perceived speaking as if he were not a black person could win an election. >> host: did you believe that a woman would be elected before a african-american? >> guest: well, you know, it seemed as if senator clinton was

definitely poised, and when we think about women around the country, they are definitely ready for that. so in a way it 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, political leaders, it didn't seem as if anyone was imminent, had an imminent possibility of becoming president. >> host: we are just about out of time, but i want to say i enjoyed this a lot. we have been talking with peniel joseph, professor of history at tufts university. and has a very deep, complex book, "dark days, bright nights: from black power to barack obama." congratulations and continued success out there. >> guest: thank you. i enjoyed this conversation.

>> now, an international perspectie on the future of the global economy. the world economic forum hosted the heads of the international monetary fund and deutsche bank. joining them was white house economic adviser lawrence somers and his counterparts from china, france, india and ya japan. from davos, switzerland, this is an hour and a half. >> good morning. we're going to start nice and promptly. my name is martin wolf, i'm the financial times. i have had the pleasure of moderating this session on several occasions, and it's always been -- is that all right? it's always been very exciting

and stimulating and pleasurable, at least for me. and we have a particularly remarkable panel, i think, today to discuss the issue which i'm sure is closest to most of your hearts which is are we out of a mess? and if we are, what follows? the situation is, obviously, very, very different from what it seemed to be a year ago and very, very much better. and we want to address not only these short-term questions of what might happen as we come out of the, out of the recession, but also we now have, i think, the opportunity to discuss some of the longer-term structural questions in the world economy, and we will address those as well. before i introduce the panel and the issues, i just, i have been to tell you, first of all, this session will go on until midday, so we have longer than normal. that should give us time for

questions from the floor, at least the last 20 minutes or so, so prepare your brilliant questions. after this is over, there will be -- you're asked to stay because we're going to have the spectacle of the south african launch, and you all know what that is of and what they're launching, and i imagine that's going to be quite an exciting event. now, let me introduce the panelists in starting the far left is josef ackermann who's, of course, chairman of the management board of deutsche bank and a very distinguished representative of the financial services industry. and a survivor, which is quite something after the two or three years, i admire anyone who's heading an institution that still stands. next to him is lawrence, larry,

summers. former secretary of treasury, now directer of the national economic council at the office of the white house and, of course, president obama's principle economic adviser. next to larry is christine big art who has minister of employment in france. next to her is dominic strauss, managing directer of the international fund. next to him is ju min who is now deputy governor of the people's bank of china, the institution that manages approximately $2 inform trillion, so very -- $2 and a half trillion so a very important person and institution. and next to him is deputy chairman of the planning commission of india, and as i think i've marked before in this place, in addition to that my

very first boss. we worked together 40 years ago. i can't -- i hesitate to admit this at the world bank. and finally, immediately to my left is minister iowa she toe, minister of the national policy office of japan. what are the issues? well, as far as the recovery is concerned, the short term, a friend of mine who may be here said that the fancy acronym for this recovery which he was giving me as i mentioned in a blog is l.u.v.. l is for the shape of the recovery of the european union, u is for the shape of the recovery of the unite, and v for the shape of asia and emerging countries. i rather like that, it seems to me to get it very well.

now, in that very mixed picture in terms of dynamism and overheating, that obviously creates big questions about how stimulus should be withdrawn. and where, in what way and how differentiated it should be. that's, obviously, a very big question. and that in turn depends very much on whether we should see the recovery we're now having as being a genuinely private sector recovery, or are we still relying on this simply staggering policy stimulus? i would like to remind you that the monetary and fiscal policy settings in the developed world today have simply no historical precedent. never seen anything like this in peacetime, so that creates a huge issue in terms of how we're going to get out of it, where the tightening should occur. then in the longer-term issues we face, we all know some of the

issues; global imbalances, exchange rate policies, an issue which is being looked at under the direct -- at the behest of the g20, the new institutional format for global discussion of the so-called multilateral assessment program. we have the huge, outstanding issue of financial sector reform which got quite a jolt last week as everybody knows with the announcement by the president of the volcker rule which shocked, astonished, amazed and excited and thrilled, i have to say, people around the world. and we have, of course, on a bigger level, too, quite fundamental transformations in the relative success and size of nations, economies, the extraordinary rise, continued rise of china and india, and clearly the discredit into which -- and we must be clear

about into which the western models have fallen. and that raises the question of what the new normal is going to look like. so as a background and with that introduction, let me turn, first of all, to view his view on the short-term to dominic. >> thank you, martin. i think in a nutshell the news are better. we all know this, growth is coming back sooner and father than expected -- faster than expected, but we have to keep in mind that this recovery is still fragile. and it's mostly fragile because when you look at the data and figures, it seems the figures from the u.s. are encouraging, a large part of this is still supported by public funding and private demand is still rather weak. so the question of when martin

asked, when should we exit from the stimulus which has been put in place, let me remind, by the way, that the idea of the stimulus first appeared on this stage two years ago -- >> by you. >> thank you. but, okay, now we need to exit. >> so is it time to end it? >> and the problem is, there's two problems. the first one is that, obviously, the recovery is a multispeed recovery. i like your luv acronym, and it shows clearly the asian part of the world is now close to the total recovery, goes fast. it's not exactly the same thing in our part of the world, including europe. and so the question of dealing with different speed in the recovery, especially in the relationship between u.s. and china, is something at which we have to look with great attention. we are not in the system where the recovery looks as if it were the same thing, about to be

sluggish. at least in europe, maybe in the united states if that's one of the big problems looking forward. if we consider the exit, the question is not only the multispeed, but the fact that the situation is totally asymmetrical. if we exit too late, even if different countries exit at different times, of course, if they exit too late as a result of policy, it's increasing public debt, we should avoid this. we should avoid this. but if you exit too early, then the risks are much bigger, and even if our forecast at imf is not forecast of double dip, the only reason why this kind of risk of a double dip may appear would be that exiting of the stimulus would be too, go too fast and would be too early. and in this case, frankly, i don't know what we could do because most of all the thing we have in the tool kit has been used on the monetary side, on the fiscal side, so the probability's low, but the risk

is high if something like this happens. so it's totally asymmetrical, and because the problem is going to be one of the biggest problem, maybe the biggest problem in the coming years also a problem for several years, the question is not of three months earlier or three months later. we'll have to deal with this for five, six, seven years depending on the country. so really the symmetry between exiting too early and too late is very strong, and our recommendation, of course, is not to exit too early which means privately that all what has been prepared for 2010 in terms of stimulus has to be really implemented. now, second point i would like to make very quickly is that besides the stimulus one of the big thing which has been discussed during the crisis was private sector re230r78. and -- reform. and finally we come to grips with this reform. another very bold proposal has

been made, you just mentioned obama's proposal, some other thing has been proposed in the u.k., and i only have to applaud to the fact that the momentum, the political momentum to deal with the financial sector is still there. my fear is that we may at this occasion forgot, forget one of the key lessons of the crisis which is coordination. and the financial sector reform has also to be coordinated. there is big risk of thing which would be done only country per country can, trying to fix the problem of your own country, limiting the risk for your own taxpayer and creating problems in other countries. it's obvious if you just look for the kind of self-insurance where you deal with the liquidity of your own financial sector and ask it to be at the high level of liquidity, you may create problem in the rest of the world. so the question of coordinating this financial sector reform is,

for me, a top priority, and i'm a bit afraid that we're not going exactly in this direction. so three, two key messages. first, let's look a lot on what's going on in the relationship between the traditional western world and asia, especially china. second message, we have to go aheadstrongly in the financial sector reform, and the political pressure cannot wait for supervisory conclaves and the traditional time it takes to make this kind of reform, but we have to do it in a very coordinated way, and imf has been asked by the g20 will provide in april a report on this question of a contribution of the financial sector to it resolution of something like this, and i think that this proposal may be helpful to try to coordinate a different ideas

which have been proposed until now. >> thank you very much. we'll come to the financial sector reform issue for sure later on. i'd like to turn to you, minister lagade, and i would be interested how far you agree a beat change is that we withdraw our stimulus too soon. finish. >> martin, i agree with that principle, and although it's not new, but i think that particularly now timing is absolutely critical. and i'll try to give you three examples. we used to operate under the principle of the triple t last year. it had to be temporary, targeted and timely. i operate myself now under the triple r principle where we have to pursue the recovery, and we have to empty the stimulus package bag that we have, and we're certainly going to do so. we have to keep up with the reform program that we have so

that the economy becomes flexible enough to pick up the wind as it comes, and third r, we have to restore public finances. and the timing of that and the balancing between the recovery process that has to continue, the reform that needs to be maintained and the restoring of public finances is a tough line to draw. second example of timing, i think, is critical and it has to do with the economy and the point that dominic just made, it's how do we combine the public opinion frustration and the necessary time that it will take for the banking industry to restore some of its powers and to rehabilitate itself with those public opinions? big timing issue. third timing issue, what you described and what we're going to the hear from other speakers is we have this luv, i think the shape of the l is a bit different from the capital l as we see it, but clearly europe is

going to grow slower in terms of accounted growth relative to emerging markets, and we see a clear, you know, it's like tectonic plates which are readjusting, and we are seeing a readjustment at the moment. the question is, how do we regulate, combine, take enough leadership to control the overheating that is likely to take place either on the economic front or on the social, political front depending on whether you are in a rapid growth country or a slow growth one? again, timing issue. >> i would certainly want to come back to talk a little bit more about what's happening in the euro zone, and i think that's a very interesting discussion whether we're talking about an upper case or a lower case l, but either way the down leg is, has been rather horrible for many countries. though, in fact, i think least of all for france of the big countries in europe including

here, of course, the u.k. so i congratulate you on the resilience of your country in this crisis. i'm now going to turn for a view of what must feel very different. no down leg at all, just a question of the size of up leg in india. and you did have a slowdown in growth. is this all over, and how do you see the prospects for end cra and indian policy over the next year or so? >> thanks, martin. well, i mean, certainly no down leg in terms of gdp, as you say. i mean, after four years of growing at 9%, the next two years we averaged about 7. >> right. >> domestically, of course, you know, when you get used to 9% and all that it holds out, even the deselllation is a matter of concern, but there's no doubt that the economy, like other economies in asia, has weathered this crisis well.

we assume now assuming we get back to some kind of global normal, even if it's not the new normal won't be the old normal, we would hope that in the coming year, i mean, our financial year begins in april, we would move from what looks like 7 and a half percent or so this year to something over 8 percent next year and then get back to 9 percent. now, there's a lot of questioning, obviously, that if the global new normal is not going to provide the exports, export-led demand to support this, why do we assume that we can get back to 9 percent? you know, our answer to that is it's going to be domestic investment-led, domestic investment replacing what would otherwise have been export demand. and that investment should be in infrastructure. i mean, that's the big e thing lacking -- biggest thing lacking in india. so we're working on whether we have enough projects ready, whether we have the domestic financing mechanisms to sport it, and -- support it, and,

obviously, there will have to be some external financing also. we were going to move from a near balance current account to a somewhat larger deficit, but i don't think the deficit will be more than 2 and a half percent of gdp. and i think that can be easily financed. i mean, the big question facing us, as elsewhere, is the whole issue of exit. now, like everybody else we also resorted to a stimulus. i mean, if you measure the stimulus as how much did the fiscal deficit go up, the combined deficit of the central and the state governments it was about three percentage points higher in each of the two years of the slowdown. now, we are greatly helped, of course, by the fact that earlier the high indian deficits used to be compared with the master criteria, and we didn't look very good. right now the whole point about comparing deficits is to look at what's happening elsewhere. we're reassured that the indian deficit is lower than the united

states, lower than the unites kingdom -- united kingdom, so really all the fears that might have existed about the macroeconomics shouldn't exist today. but the signal we're clearly giving is we need to get back in a medium term to a more reasonable fiscal deficit position. it's not our view that the present fiscal deficit, which would probably be about 10% of gdp taking both the center and the stage together, it's not our view that this is the normal thing. but we want to bring it down gradually, and that's what policy will be aimed at. meanwhile, we hope we can see a continuing rebound in investment. now, the good news, i think, is that the successful performance of the economy in the short run has, in fact, created a lot of confidence in the private sector. in fact, there's a marked difference in mood in asia and the mood, let's say, in the industrialized world. maybe we ought to be more

worried about things, but the fact is that investors are really quite upbeat. and i think on the supply side, i mean, these are economies which have demonstrated a capacity to grow, so the supply side is not a problem, we just need to make sure there's a global rebalancing of demand that works to our advantage, and that's what we're trying to do. >> thank you very much, and i think it's a very, very important point to stress that the solvency relates not only to the deficit, but also, of course, the growth of the nominal gdp in a country which is growing nominal gdp at way over 10% a year. this is easier than a one where it's shrinking, obviously a central point, and i can also imagine some pleasure in pointing out the development of some countries with much bigger deficits than yours after all the lecturing you have received. i'm now going to turn, we're talking about asia, to asia's giant developed country, japan.

so how does -- which was very hard hit by the crisis initially though there's been some bounceback, but there was a huge decline in gdp, so we're now going to turn to the minister for his view of the prospects for japan. ..

>> translator: this caused a major fall in our economy, and from that fall, japan and other countries in asia in case of japan mainly, led by the growth of the asian economies and china and our stainless package of fiscal and financial stimulus. we are now on the track of gradual recovery. however, in case of japan, when we look at manufacturing industries, the rate of operation is still 80%, recovery is still at that level. therefore, we have a late employment held by various corporations. in other words, many companies try to maintain the employment

without laying off the workers. therefore, we have right to be on the full place to recovery. so that's how we seek the set of economy now. but on the 19th of september, last year, we have achieved the change of government. that is the first major, change over the government, in the history of the japanese politics and the prime minister of the democratic party of japan became the prime minister. this is remarkable scene in history. we have 120 years of parliamentary democracy, and the 65 years have passed since the end of the world war ii and the

85 years with the establishment of democratic parliament. and we have seen the substandard substandard. when we look at the issue of economic structure, when we look at the post lame in shock years, where we have suffered a major blow, not only the economy and japanese economy, also suffered, not only short-term that would have to go through the major change in medium to long-term. we have to achieve the structure of change. so at this point in time in terms of economic structure, the political changeovechangeover took place. in other words, we tend to overly rely on the extra demand, but have yet to change the structure of japan, more dependent on domestic demand and

dependent more on the knowledge intensive services industry led by technology. so maybe the lehman shock, may be the case that we give us the opportunity to change the economic structure. and it has historical significance that we now are faced with this mission of changing japanese economy. i'd like to conclude this at this point here. >> thank you very much, minister sengoku. we will certainly discuss what some of those structural changes might mean, particularly as we move towards more domestic demand led economies. everybody always promises best and yet as i pointed out in a recent column by my rough and ready calculations, at least 70 to 80 percent of world gdp in countries that seem to be hoping for export led growth. it would be helpful if we

diminish the proportion somewhat sends mars probably isn't a very good import market. now let me turn to the new asian giant, china, which has had an astonishing new successful stimulus program and the remarkable growth performance last year, which some of us and i have to admit, i am of them, were somewhat skeptical about. so congratulations. and we hear a lot about the overheating bubbles and obviously the government is now withdrawing thinking or trying to rebounds the economy in terms of demand. so what does to 2010 hold for china and its relationships with the world? zhu min. >> thank you. china had a good year, and we had gdp growth at 8.7%, but

behind the number, i will say the structure is much more balanced. consensus growth is 15 points 6%. and if you're looking for the regions and the east coast have lower growth rate around 7%. but the middle and west have 12 to 14% growth rate. so within china, the rebalancing has been improved. healthcare and highways, have been bill because part of stimulus packages. and also social shifting that has turned to build a. i think those are the things behind the numbers. however, if you're looking for this year, the new charges in march. the full challenge i would say the expectations. i have to say inflation is not there yet, but expectation emerges.

they have 28.7%. and long growth rate is 30%. is a very strong. in the market, and the last, still have cpr of the 0.7%. but indie cinema, the cbr never jump to 1.9%. in the coming of, if oil 90-dollar per barrel, and food crisis still have pressures on upside, and they will for the reform the prize, water, power, few things, in particular, much more stronger than into. that is the cash flow among the growth on the strong and, the journal, so means many philosophy increase. so that was part of inflation of expectations.

so we think would be very important issue for china policies is coming here. the second issue, is a structure change and also deal with over capacities. the structure issue in china is a remaining structure, obviously consensus is still lower investment is still very strong. yes, 15 points 6% is very strong job. so still not balance to each other. and we will pay more attention to stimulus domestic consensus, so serious all as he for example, income, further social safety net, healthcare, education, and allowed goods particularly to the rural area to stimulate we will keep doing that to make sure we will grow. in the hope and expect in this year and a gdp growth rate, and

consents contribution to the gdp were more or less equal to investments to gdp growth rate. now the first time in china we have more balance gdp growth. but as the target was to ask them to do. the capacity is a big issue. last year was very strong growth, the heavy industry. we have 60% industry growth, but heavy growth of 22% only 12%. with heavy, the growth jump to the capacity increase, for couple, for steel mill. china have a steel billet, but domestic demand is roughly 520 million-ton. so it is around 180, 2200 overcapacity in the steel mill. which is harder big issues. shipyard building and all the few things, we understand the u.s. consumer, last year 16%

export drop. but we think it will come back. so have to carefully manage the overcapacity issue, which odyssey is important issue for restructuring. second, the second and main challenge of china still the macro management. i very much agree with dominique, the rebound still very fragile. we expect to see a wakeup volatile growth in the international arena this year. and particularly we seek the u.s. economy have a bump in road quarter by quarter. which obviously will have impact on china's import because impact of china's exports on their to with consistent of macro policy will continue with accommodating, relatively a calming and fiscal policy, make sure have sores small macro

manager and make sure growth path will stable all that year along which is also a major challenge. we are confident with the number there, but key issue for china is not number per se. it is rather the quality, efficiency, structure. we want to reach more balanced, more consenting growth for this year with all the policy in hands and with conference will probably be there. hopefully the international violence is good. >> one of the many issues you raise there is if investment is growing at this rate, and there is such an enormous excess capacity in some crucial industries, many people are very concerned that when we look at the picture in 2011, this capacity will be even greater. and perhaps where we can come to the question of whether the chinese government has any way of getting a handle on that

issue, which i think terrifies the wits out of many people around the world. the numbers you gave, if i remember correctly, your excess capacity and steel must be roughly the total production of the european union, and vastly greater than the production of the united states or japan, which after all, not small economies. this is quite a phenomenon. mr. ackermann, josef ackermann, how does the recovery look to you for your industry? are you back to lending? many people say you are mainly back to making fortunes for itself but there's no credit growth in any of the significant economies. how far is their genuine heating of the financial sector as it bears on its capacity to support growth, and the developer were is a problem over the next year or so? before we get to the financial structure is just. >> thank you.

well, i agree with christine that it is somewhat pessimistic for your but i also think it is somewhat too optimistic for the other agencies. if you look on macro numbers, i think that's somewhat misleading. because as many of you know and industrial sector come if you look at different segments, where the correction has been 30, 40, 50%, even growth rates of five or 7% means that you will have years to wait before you reach precrisis level. that's what i think the situation still very fragile. and if you look at the financial markets, they have become pretty nervous. there are a lot of threats on the horizon. inflation in some parts of the world is clearly the commercial real estate in some parts of the world it's also what we are seeing in terms of carry trades, which may be unwarranted. but, of course, also some risk has become a major issue.

legacy assets still in the banking system. so all in all, i would say we better keep everything on the somewhat cautious side. the banking sector is clearly benefiting from the tremendous initiatives been taken by government and by the central banks. but there is also, of course, the risk of timing and the impact of the exit strategies, which is pretty unknown to all those. because we've never gone through that. and on top of that, we have a complete change in the geopolitical structure. namely, what do you just mentioned, martin, this adjustments to the chinese growth that the chinese capacities means a lot for the other parts of the world. and i think we have to cope with that, and in the transition phase from a geopolitical situation to have a super power, a to a multi-power world.

you will see a lot of this and i think you'll see a lot of volatility. now for banks, those who have been more in, have been quite successful, also due to the fact that there was a lot of liquidity in the market. those who are more exposed to the real economy, clearly have seen that the full rates are going up, and the situation in many parts is still not very satisfactory. and so, in some of the legacy are still on the balance sheet of banks. now lending, there is of course always two sides to the story. if the real economist slows down as it has done, the demand for credit is also lower. and that has to be taken account of talking about statistical numbers. but it is also true that the regular uncertainties, and taxation issues which have come up for those of risk awareness of banks have led to a more

cautious credit policy, which has an impact on the credit supply. >> thank you very much. and again, underlying at least for the developed world, this extreme sense of uncertainty, very much a contrast of course with a very different challenges we see facing india and chinese policymakers. finally, relative i would like to turn to you, larry. how does the u.s. now look, and particularly in the global context you've seen set out? at one issue that i am particularly interested in your comments on forecasting for the u.s. at the moment and for europe, as well. do you not suggest any significant tightening in the labor market, will there be a continuing hangover of high unemployment, very high in employment in the u.s. in a way reflecting the extraordinary flexibly of its labor market and the rapid rise in productivity. does that concern you not only

as an economic policy matter but also as a political matter in terms of maintaining the general thrust of that open integrated world economy? >> martin, thanks for being here and more or less thanks for that question. [laughter] >> what we're seeing in the united states -- >> it's not a joke. >> and perhaps in some other places is a statistical recovery, and the human recession. more gratified by the most recent gdp figure. it suggests that the policies to contain economic collapse have been successful. and my judgment, and i think most people who have looked at it, judgment will be that gdp growth will continue, at least at a moderate rate, for the next several quarters.

what is disturbing is the level of unemployment. and this is not just a cyclical, though it is heavily a cyclical phenomenon, but a structural phenomenon as well. just to put it in a way it is not usually put. one in five men in the united states, between the ages of 25 and 54, is not working right now. and a reasonable extrapolation would be that following a reasonable recovery, it will still be one in seven or one in eight who are not working. that's in contrast to the mid 1960s when 95 percent of men between 25 and 54 were working.

that suggests quite profound issues that will ultimately impact politics, that impact the decisions that businesses make. and underscore what the president obama emphasized in his state of the union address a few days ago. the primacy of jobs. and i might also suggest the primacy of maintaining the flow of credit to medium-sized businesses as a policy objective. i am very optimistic about our support for an integrated global economy. i think for a whole set of reasons, diversity of its population, the openness of its

institutions, the way in which it serves as a magnet for people from all over. i think the united states is very, very well-positioned to gain from increased global integration. but it's going to have to work for people if it's going to be politically sustainable, and that's why the jobs, the credit agenda, are so very crucial. i might just also say that, while i believe very strongly in the importance of growth oriented policies today, because no one is going to have a healthy fiscal situation in a global economy that's not growing at a reasonable rate, i think it is also essential to recognize, and maybe this is a

segue to our medium-term discussion, that in the united states and in other parts of the industrialized world, you know, we are somewhat unique in the united states and doing every six months a careful 10 year budget projections. and so our problems become particularly salience. those are done in most other countries, but if they were done in most other industrial countries, in the same why our congressional budget office does it, it would not be pretty. and our ability to maintain confidence over the short and medium term will depend, not on taking overly rapid fiscal consolidation, which i think could be quite problematic, but in finding ways to provide confidence, that over the medium-term we are not on

trajectories at rates more rapidly. than income. and so that, too, is a crucial part of the american macroeconomic policy picture, i think needs to be kept in mind as a general issue. >> let me just, before i will feel remiss if i didn't address this issue now, so which is how externally and by the, what's happening in the the entire come particularly relate to the balance which is being addressed, and i don't think it is an issue we can avoid. exchange rates around the world including china. how relevant you feel those sorts of questions are for the sort of short to medium-term prospects of the u.s., or how much a centrally this is all still fully within your own domestic control, that there is,

the external environ is in no sense a constraint on your ability to deliver the sorts of outcomes you need not only in terms of gdp, but in terms of our busy generating jobs for these people, i presume many of whom have lost jobs in manufacturing. >> is that for me? >> that's for you. >> i believe exchange rates to the secretary of the treasury. but i will relate very well to dominique's comment, that not everyone can have explored leg growth. and the way we get to that picture, i imagine, dominique, is that countries that traditionally have had export led growth desire to continue that export led growth. in a country that haven't had an export led growth and have been substantial borrowers, desire to reduce their borrowing.

and their is an adding up problem, and i think it is quite serious adding problem. and we do need some policy reorientation. if we are going to maximize to things. if are going to maximize the adequacy of demand and its location in the global economy, to push, to push growth forward. and if we are going to maintain support for the global open trading system and maintain resistance to protectionism. you know, one of the last points he made in his writings before he died, was paul santos and

emphasize that strong and robust as it was, the principal, some of the most important qualifications to the standard economic arguments for free trade went to situations in which they were significantly unemployed resources and aggregate demand shortfalls, and went to situations in which mercantile policies were being pursued in some parts of the world. so i think this rebalancing issue is important, both use imf type lingo and a conjunction role or cyclical context. and in terms of the medium-term growth paradigm. >> i'd like than to bring this conversation which now gets to some sort of longer issues to

dominique strauss-kahn. to issue stick to which you might to address. the first is the one we just discussed and you're engaged in this mutual access but program which is a very interesting new initiative which is actually mandated to you by the g-20 leaders themselves, and you're supposed to produce some estimates of the compatibility, consistency, the adding up as it were a policies around the world of the big countries by april. and that also where we are on the financial reform question. you raise, tickle yourself the question of are we all doing this in a coordinator way in the global financial system. obviously everybody knows there was tremendous anxiety or distress or whatever it may be expressed about the sudden announcement by president obama last week, perhaps you would like to address those questions as well. >> thank you, martin. on the first question, i think that while the question of and balances are looking a little

better than before the crisis. if you really want to make kind of, we had a huge deficit, namely the u.s., now what happens? on one hand the u.s. consumer is saving more. and i think it is going to last for a rather long time because of important change in the household's behavior. if it's the case, that's good news or the and balances that may be bad news for growth. will come to that later. but it is good news for imbalance because we're more saving means less deficit. on the domestic side and on the current accounts i. on the other hand, on china, there are very strong statements have been put in place was basically to shift from a totally export growth model to a more domestic growth is that while. this also goes with a rebounding

of the situation. so on both sides, since are improving. is it enough? obviously not. and we are looking to the new source and when you ask yourself who's going to replace the u.s. consumer, if this guy is going to consume less, then everybody's eyes are turning to emerging countries, including china, and hoping that decrease in u.s. conception will be offset by increase in emerging countries concepción, india, brazil, others. the problem is that it doesn't add up as easy as will take a lot of times that the same kind of products, to shift in china. and so what we have been asked to do by the g-20 in the first one will be provided a minister in april is kind of a just assessment of what's going on. when you