this world is not my home, which you may know. i will give you a sense of that sentiment. .. if i was you. ♪ something like this.

i ain't got no whole mine just traveling around. i'm just a wandering worker. i'm going from town to town and the police make it hard whenever i may go and i ain't got no helm in this world anymore. just like that. it's got the market all over but i think. now, during the depression, woody begins to get particularly angry at the song's coming out of the industry, the great american songbook which is pretty top-heavy with those on the sunny side of the street. i love this for the country pact coast-to-coast. the worst criticism that woody would give his fellow songwriter later on was no, it sounds to matt damn tin alley. it didn't like the popular music industry. you look at the song but there are some pretty good songs

coming out of the depression that do engage with the reality with the economic realities for instance ♪ ♪ once i build a railroad i made a run ♪ ♪ made a race against time ♪ once i built a railroad ♪ now it's gone ♪ brother, can you spare a dime great song. i love that song. there are few songs that to capture this helplessness and despair of the depression era. but my point is that hopelessness and despair, the last thing that woody guthrie is out to corral because he is angry at this point where he wants to corelli's ander. ander that will lead to an organized rebellion, reorganization of the social and economic system. at this point he's dedicated to nothing less than the overthrow of american capitalism. you know, so this is the time

when in contradiction to an approach like a brother can you spare a dime written by someone who became a to a friend of his and is as yet later on. in contrast to that approach, woody is beginning at this point to get interested in the old out of ballots his mother used to sing when he was growing up in oklahoma, the border bells and britain would take a highway man and turn him into a crusader for economic justice. this is the time when he's dropping into his notebooks i love a good man outside of law as much as i hate a bad man inside the wall and he starts writing his own ballots. for instance he chooses as a subject in his most famous outlaw balad somebody who probably didn't deserve the honor conferred upon him this is a local oklahoma petty thief bank robber sort of general all-around scumbag named charles floyd, pretty boy floyd there is

no evidence in the historical record that he had any kind of a social conscience whatsoever. in his hand as he becomes somebody for whom digging for a dime would be an act of self the trail but more important he takes on the responsibility of the capitalism ignoring its pretty boy floyd who ignores some will rob you with a six the dun and some with a fountain pen. woody begins writing about the british highwaymen who takes all the money and distributes it and spreads about equal just like the bible and the profits suggest and i think all of his of all ballots the one that shows which waihee is going is an outlaw ballett written about somebody who is just a plain old working man and perhaps the world's first socialist. as he puts it to the mouth of one of his characters in the autobiographical novel bound for glory he's got me sitting around a campfire box something like

that i tell you one thing if jesus christ were sitting right here right now he would say this very same thing. he would tell you we all just have to work together, build things together, cleanout together, fix up old things together and own things together. jesus don't care if you call it socialism or communism or just me and you. a significant balad of jesus christ makes this connection with the holy of law even stronger because he bases the tomb and the format welcome correction he rips off 100% walks of and about. the format from the old american out about what jesse james. ♪ ♪ jesus christ was a man who traveled through the land ♪

♪ he was a hard-working man and a brave ♪ ♪ he said unto the rich share your goods with the poor ♪ ♪ so they laid jesus christ in his grave ♪ ♪ jesus was a man and a carpenter by hand ♪ ♪ that dirty little coward they called judas and did scourer ♪ ♪ the lead jesus christ in his grave ♪ ♪ he went up to the preacher and he went up to the sheriff ♪ ♪ she told them all to sing ♪ he told them the poor would one day when the world. that is why they laid a jesus in his grave ♪ ♪ the people of the land, they took jesus by the hand, and they

followed him far and wide ♪ ♪ he said i, not to bring peace, no i come to bring source ♪ ♪ so they killed jesus christ on the slide ♪ ♪ jesus was a man and a carpenter by and ♪ ♪ with followers true and brave ♪ but that little card they called judas lead jesus christ and his grave ♪ ♪ people held their breath when they learned about his death ♪ ♪ and everybody wondered why ♪ it was the landlords and the lawyers and the soldiers that he hired that nailed jesus christ in the sign ♪ ♪ this song was written down in her new york city of rich men and slave ♪ ♪ and as jesus preached today

like he preached in dalia ♪ ♪ they would lay jesus christ in his grave ♪ ♪ jesus was a man and a carpenter by hand ♪ ♪ with followers true and brave ♪ but that dirty little coward they called judas ♪ ♪ he late jesus christ in his grave ♪ there's an unrecorded verse written down in woody's book in hard hitting songs for hard hitting people, never recorded. ♪ ♪ it is the love of the poor the one day turn to hate ♪ ♪ and in the patience of the workers fades away ♪ ♪ it will be better for you rich if you have never been poor ♪ ♪ if you laid jesus christ in his grave ♪ ♪ jesus was a man and a carpenter by man with followers

true in the brave ♪ ♪ but that the dirty little covered the call judis laden jesus christ ♪ ♪ late jesus christ ♪ they leave jesus christ in his grave ♪ ♪ [applause] that song was indeed written in 1940 and was the end of an iraq because the previous year president roosevelt announced the experts of the new deal was being officially wound up and the government resources were being redirected to concentrate on the increasingly shall we say global issues, and so it is the bitter cold and new years of 1940 woody guthrie decided to make new york city his home and he is hitchhiking north and east out of texas and seemed on every

car radio and every roadhouse jukebox he hears what appears to him to be the latest self righteous complacent patriotic author from tin pan alley. this is 3940. kate smith singing god bless america. now, there are two ways of reading the song. you could read it as the servant and fearful hope of a russian jewish immigrant to the united states who was watching nervously the rise of fascism in europe and praying that it will not hear. that's one way of reading it. it is and how woody is all this. he saw it as yet another unbelievable assertions from the industry that there could possibly be an on merkley solution to the earthly problems. he hated this song so much that he sat down and wrote an angry song in response to it and it

became his most popular. after he finally died from the huntington disease he inherited from his mother and had progressively silenced him throughout the 1950's and the early 60's his son recalled the irony of that particular song of history. he said i remember him coming home from the hospital and taking me out to the backyard just him and me and teaching the last three versus two this land is your land because he thinks that if i don't learn them no one will remember them. and his friends think that he's drunk or creasy and stick them in a green room mental hospital in when he can't write or talk or do anything at all anymore he hits it big. all of a sudden everyone is singing his songs. kids are singing this land is your land in school and people are talking about making it the national anthem. bob dylan and all of those others are copying him and she

can't even react to it. the disease doesn't affect his mind. he's sitting in a mental institution and he knows what is going on. but he can't tell everyone how he feels or he thinks it is the title god bless america to see the manuscript to see that it's got a blessed america and it contains a couple of teller anticapitalistic versus that i don't remember singing in school a lot of americans never heard him until january of 2005 when pete seeger and bruce spurring sing sing from the steps of the more the let barack obama's inaugural concert and the next day people across the country are saying that's the way woody route this? yeah, that's the way that he wrote this. so i will leave you with a version that i think pretty well charts the progression of this song from the angry and the bitter satire that it was to the unofficial national anthem that eventually became come and i will also thank you for coming

out and listening tonight. >> ♪ well i walked down the highway ♪ ♪ salles above me the endless sky way ♪ ♪ i saw below mechem the golden valley singing god bless america for me if ♪ ♪ i follow my own footsteps in the sand ♪ ♪ if in the desert all around me

that boy kept singing god bless america for me ♪ ♪ the son who came shining while i was strolling, the wheat fields swayed and the dust clouds rolling ♪ ♪ as the fall was lifted that old voice kept singing ♪ ♪ god bless america for me if there was a big wall that was there and tried to stop the ♪ ♪ named private property and on the other side ♪ ♪ and god bless america for me

♪ in the city in the shadow of the steeple ♪ ♪ i saw my people and it stood hungary i stood their wondering ♪ god bless america for me ♪ nobody living should never stop me ♪ ♪ as i go walking that freedom highway ♪ ♪ nobody living can ever make me churn because this land was made for you and me. ♪ this land is your land, this land is my land ♪ ♪ from california to the new york island ♪ ♪ told me

♪ this land was made for you and me ♪ ♪ [applause] thank you. [applause] your watching book tv on c-span2. coming up next, book tv

present "after words," an hourlong program where we in fight against host interview authors. this week journalist nicholas wapshott and his latest book keyneshayek the defined modern economics margaret thatcher tickell's economic theory exploring the virtues of free market versus one in which the government intervenes. he discusses the competing perspectives and the men who made them famous with u.s. business editor of the economist, matthew bishop. >> host: nicholas, one of my favorite quotes from john maynard keynes is the one about how practical men often sleeves to some economists and you've written a book about the two himself mr. keynes and frederick hayek what do they matter today? >> it turns out the great dividing line in terms of modern

economics between whether you start interfering in the economy and try to manage it and those people who said don't do that because they will cause an enormous mess and we have to clear it up eventually was 80 years ago when john maynard keynes was the most individualist of the economists day and certainly the most influential list of the 21st century started working out theories which looked to the economy in a different way instead of as a series of business propositions which traditionally the economists did. he started looking at as if he hovered about economics and what became known as the macroeconomics looking at the big picture about different elements and different moving parts and also because also he was talking at the end of the twenties when britain suffered a great deal of unemployment. the large scale unemployment was a great problem. he was looking at it from a practical point of view. is their anything the government

can do to the economy which might cure some of the terrible poverty, this terrible condition of people not to find work on years on end. and that was years ago it turns out that this division between whether you interfere or don't interfere in the economy turns out to be the principal political issue of this electoral cycle being submerged for a long time of course the keynesian store in though succeed enjoyed for years i suppose to the 1945, 1975 interviewing economy and managing it for the benefit of the population that may be the command economy bigger between 1975 and 2008, say, we had a different thing. the notion that keynes was right in the principles but what should try to ration the amount of new money that you would ease into the economy so that an economy wouldn't get out of kilter with itself.

he started off on hayek and didn't think very much of the economics. the principle was what was keynes and hayek fell over was economics. but actually the strength of hayek turned out to be to interfering in the economy because spiegel suggested you can't come in the, you can direct people, the government may do that, the government may cut taxes drastically and ease credit to ensure the activity picks up. notwithstanding all of these various things a government may do he said yes but all of these until increasing the size of the government if there is a problem about that and that is that the more you increase the size of government the larger the proportion of an economy is spent by government agents rather than the people themselves the district taxation

rather than people spending out of pocket but more likely you are to have a tierney in society and so he added something which certainly is found with a great echo among the other in america would have been conservative that actually it is the government itself which is the problem, and that of course is something which has risen to needed since ronald reagan or innocence in goldwater in the republican tradition. but then it seems it is this side of the family that is the main traditional republicanism has been more like the conservative party of increasing the trippi together, but with the different point of view, the editor absolute point of view of what should or should not be done and the government itself turned out to be the problem as to how it was concerned and the solution whether he went or not is irrelevant in a way but the fact was even if they did work and let's say they do work the fact is that they said friedman

said that is a bad idea because we don't want the state to be too big because that checks every individual choices and the basis for the undermining of the free choice and. >> host: what strikes me as interesting in the book is the extent to which you get into the personalities and how keynes and hayek interact with each other and you think about the debate today in politics and is a real shot and match to win on in the tea party right that endorses hayek in this vitriolic opposition to the keynesian paul krugman i guess being an obvious choice of the keynesian school of i think we can disagree with how much keynes would improve the position but there's a sort of intolerance where asset in the book they have enormous aberration. i'm not sure whether he admired him quite so much but maybe you could talk a bit about how that relationship developed over time

and did they really respect each other? >> we like each other in the in the and you are right. of course hayek already knew and he wasn't just famous by the time that hayek move into the fall of planet of the economist and pointing out to the treaty of versailles would be tragic for europe and would lead to a second world war which was true keynes was an austrian in the austrian war during. he knew from his own personal experience the amount of inflation toledo said austria at the end of the war and was hayek keynes was right about it. that was the way towards the extreme politics and so he started off knowing keynes was a mythical figure and in a way that never really departed. he always maintained an enormous respect strength and that by the way almost anybody who can across him because for churchill

i didn't -- you could doubt that keynes was the greatest of the 20th century. he was an astonishing creature. i wish we could meet him. he was a person capable of judging with many different at the same time. his achievements were astonishing even if just one career was on track and good he would have been an astonishing person. but actually he ran and established the national gallery. he used to stay in bed until noon every day on the telephone to the stockbroker. he really understood the market even though people say they admire the market. >> host: he is just seen as the face of big government, where in fact was actually in many ways a capitalist in the

capitalist system back in the 1930's when there were much more extreme views as to what should replace the stock market crash. >> it is the problem of knowing too much about the economic future in the modern public for call debate because words are bandied about so certainly. obama is a socialist and keynes as a socialist. well, not really. but anyway, to go back to the keynes and doyle fang, the problem was that keynes was brought in by the professor of economics at the nsc to counter keynes to use it was set up already in the first place for what could be the battle. they already had a battle with keynes in the committee, the government committee on the use of the bank of england. and that started off pretty sharply. remember of course this is not your gentle to and from of the

argument. this is pretty high flown stuff fought on pretty tough measures. keynes was the king's college person and his stock and trade was sarcasm. that's what he -- had the attack on people in it protected him as every other school from each other all those years. he was a different sort of thing. he would literally backed off. his jacket have three buttons and he was very well mannered. they were brought up to treat each other properly but when it came to important things like disagreement over the economic debate, then they just took their gloves off and so right from the very beginning of the debate was very sour. they were very rude to each other to extend the of their academics said this is not the way to conduct academic debate please don't talk in these terms but it started a trend that

until after this day they absolutely despised. in decades they pretended they didn't even exist. if you look to the genius three volume he is barely mentioned. >> host: why is that? >> guest: i guess he could say i was talking about keynes and he didn't take account of keynes but of course he did take account of him even though he found it rather exhausting and retrieval weigel abandoned it and gave it over to continue the harassment, but he did -- the so-called wonderful group of young economists around keynes were as pernicious as keynes himself. they learned of his need. they would delete things and was put together personal. by the way when you leave

tonight -- he was quite capable. one of the films we know about that austrian or german speech is that very often it sounds far more abrupt than it might to an english man who constantly [inaudible] but the crisford austrian debate that says it is even truer today they can be taken aback when we come across an austrian word german who asks a profoundly personal question would. but in that case, the hayek was as good as they got and the result was certainly in the initial battle when the two men locked on the actually did lock on and they didn't let go. they barely actually scored a genuine point against each other in the real debate because they are too big sniping at each other about the investment of what you mean by savings? investment, i would like to know more about what you mean by the

replacement of stocks. they got bogged deep down into the weeds into the long road. and really didn't escapes from it. >> host: let's find ground the different views in today's. how would you define and wendi with nsc and can see in? >> guest: it is someone suspicious of all government effort to manufacture the boom in the economy with. hayek was true on this from the beginning but in the hayekian remain true to it today and its economic generally and then to say that actually the market over the long term cures itself and there would be equilibrium would where everybody is employed once again was a disaster and economics you can have a market failure you can't have doubles and crashes but that is something you have to get used to and the liberalism and ultimately what the economy

would find its own way and we would get more prosperous; is that the idea? >> guest: it is to say actually saying that the bottom of the cycle there is destruction that is really necessary to ensure the economy continues to roll and expand. >> host: and the team since? >> guest: they look at the society as it is, look at the figures come in and say my goodness this is 9.3 per cent unemployed. once more something like 15% of them have been unemployed for six months or whatever, longer than six months. and they start looking at how many young people, how many minorities and so on, whether the proportions are larger and they come to the conclusion this is intolerable and the government as it can intervene should intervene by whichever method they think is the best and all of which have been tried by the way by this administration. they've made interest rates zero to the horizon.

so if anybody wants to borrow to invest anything is not going to cost anything and they can depend upon that down the line. the problem with that, as keynes said, is you can't really push on a string. you can expand something that people don't leave into the void, the countries are in the need to borrow that isn't getting very far. keynes also suggested, and this is now almost politically impossible where the dividing is the administration that is the government with congress on the one side as it is not willing to compromise on anything. adis to directly employed people, the so-called schoeppel ready products. we build the schools, we build the roads and so on. it is a matter of current hendee date right now. what the obama jobs bill says that's what we ought to do and we ought to cut taxes. if you want to increase demand in the economy which is what keynes said as listed like providing extra electricity.

if you lift the demand you can do that by cutting taxes. >> host: hayek's viewed sounds like a counselor at despaired. keynes say we are all intelligent, some of us are intelligent power of government exists to apply to our intelligence to try ourselves on the big change the world faces, whereas hayek's viewed sounds like basically saying the intelligence is basically nothing we can do for the government. it does sound like a spear or is there more to it than that? >> guest: there's not much more to it than that. it is a pessimistic view of the world come and that is that when it comes to some things, knowledge and intervention helps, medicine or whatever her but it does depend on what stage of discipline you are at one and

the total wrong direction and when keynes was awarded his nobel prize he said to come here to apologize for the economics profession. the fact is we have done a terrible job and it is right to decades to get out of it and start now. he actually liked your free bdy say we take a long term and it's printed a long time to ever get back to the free and open society. >> host: the question of course when we are talking about the public today, exactly what a hayekian economy, the genuine hayekian econ amine what look like it is all very high relative to the agitator if you like to constantly slide we don't want any raising of taxes, we don't want any government spending these are absolutely are not going to agree to anything if there is the tradition in that. but chamois numberless they are

drawn on exactly that one. if hayek's will come about, well, the size of the economy is very large for things like pensions, would they do without pensions? some people are on the edge of that right now. >> host: he basically said the government should only do the absolute in the society would be essentially run the defense as far as i can see. also in favor of the party rights and enforcement of the law and order. >> guest: exactly, the rules law while. it is picked up by margaret thatcher kabul rules law was a society a central will get into trouble quickly. >> host: verifies your inspiration by mrs. thatcher and ronald reagan and very much people regard thatcher and reagan to hayek and his

thinking. how much in reality did what those two leaders one produce and stand up against what hayek actually wanted? >> guest: a number of ways of looking, thatcher on the conservative research department they were discussing she got all of her handbag this capacious and slammed down the road to serfdom on the table and said -- by frederick hayek -- and said this is what we believe, so no doubt what she believed was to introduce for the first time actually into the conservative party we have a catalyst of things that you should try to obtain which actually come out of the book on the whole conservatives and republicans never used to do this, so this was lawful. were they really hayekian? he never went out of his way to ask let me just make this clear i am not an adviser to mrs. thatcher and i do not

advise president reagan said he always denied that they were. >> host: did he approve and what they were doing? >> guest: they were not wholehearted enough. he thought that they got the message, but in the practical policy they were saying about the election today it is a difference between saying are you going to use this in order to nudge the world closer to your way of thinking or deep actually intend to introduce the whole scheme, which hayek recommended in which case we will have a very powerful time however long it takes even if it takes 20 years it will be a very uncomfortable 20 years. because they're all sorts of things that will disappear in putting all sorts of things to do with the representative democracy hayek was -- hayek didn't believe in -- he still believed in prices, he still believed the market he thought that even from the city government it shouldn't exist, it should be handed over to a corporation. he didn't believe that the dollar should -- that the pound, sorry, the dollar should exist.

he believed the there should be private companies, each issuing currencies and that we would eventually come to understand which was the strong currency and which was and and how to use the various currency. but he also believed, by the way, something that hayekians believed there should be the free market leader around the world there should be no border between nations. a lot of this real hayekian stuff runs counter to the people who say the they are hayek or deride from hayekian, but the main problem about reagan and thatcher -- and there is no doubt that there is an indication if they didn't do very much in hayek's terms it just shows with the real hayek future might be an article that might be that most of us would believe i think that actually reagan and thatcher noticeably changed the way the understand the world we live in and gave much more credit to the things such as hayek was suggesting, such as the return to the free market instead of the mixed

industries. and it is unbelievable if you think that when thatcher took over from a leader in 1979 the services of the post office, telephone services, coal mines, steel, shipbuilding they had over time created the state as the had been brought into that privatization was the beginning of the first step towards the state selling off all of the bits that it doesn't need to do. she had 13 years from the conservatives fighting there ever since a four per legacy mant and whether they should continue it. interestingly, in britain right now, we are in a sort of accident all hayekian experiment. when the conservative coalition looked at the books and when they had a discussion of the government of the bank of england they were told that there was a problem on the sovereign debt because britain had borrowed heavily. all the western nations for

heavily to get out of the 2008, 2009 disaster, and you could do two things come you could start paying it off sooner or you could manage the economy and get direct health help in the wisdom cameron and osborn decided that they were going to head off sooner rather than later and the result is as we can see that it hasn't gotten to the double the recession yet, but the figure is absolutely looking at heading south. when i talk about 0.1 growth in britain -- >> host: do you think said cameron and his advisers have actually read hayek and what have any interest in that kind of intellectual debate? i mean, she clearly had the least growth in the handbag -- guinn >> guest: i thought she read it and reagan is a great reader and he rattled off hayek and all sorts of people, unlikely people. he was much more serious than

one might imagine. but as osborn read keynes and hayek. >> host: obama has certainly not read keynes -- >> guest: not much about economics at all. he depends on -- roosevelt had an instinctive what to wear as obama has saved less [inaudible] considering both osborn and cameron who read politics, philosophy and economics at oxford i don't think has a real grasp of keynes and having a very slender understanding at hayek it's not good. why >> host: talk about the road to serfdom and how that book came about and what drove hayek to read that particular at that particular point. >> guest: it's interesting because he came back in an odd way. hayek had moved to britain in

about 1930. he was none of the things were guest. he was not anti-semitic, he was not sympathetic to the right, there were all sorts of things that he didn't sit through the clich. notwithstanding the fact that he had letters of commendation from the general of the bbc at the president and everything else in order to help more time britain he was turned down, and that i thought was actually in terms of their turning points in history they should have used keynesians come amazingly valuable, great insight into the german and austria. and just extraordinary brain was able to talk to tackle things like the rationing say, even practical things we might need to do in the wartime society. but at any rate they said no thank you to read the result was he devoted the war to writing what he thought was he was actually aiming at more to the

left than the right. what he was anxious about when the war was over that because the war had been seen to cure unemployment in a keynesian way that the government would increase the size of the government's wholesale, and he thought that there lay the danger of the soviet communism he was more worried about because not as some had been cured or defeated -- nazism had been cured or defeated. that is what he said to the post. he predicted the totalitarianism as a result of that growth of the government is a cozy social democracy or a nasty brutal -- >> guest: he looked at the soviet communism and the evidence it is to assume people beating in that way.

that had just happened in the world and we are going on to save the communism, so it wasn't too difficult to do morning. of course it all went terribly wrong because churchill, who have read a lot of things and have read the road to serfdom for half-read and he comes to the conclusion of the labor party were elected in britain in 1945 that the gestapo, there be a british firm of the gestapo and he was foolish enough to save it, and this came directly out of hayek which allowed the other reason people in the the just liking hayek because of the social democrats had nothing to do with communism all. communism was the chief rival and they found hayek saying that they would be just as bad as a communist, and so with a single swipe they took hayek out of the game. >> host: you talk about how inouye, sweden, some of those scandinavian democracies have

emerged now because the definition of the big government, and yet no one would look at those as awful places to live and it is quite good in those countries and to what extent they got a reputation of the view. >> guest: i would say pretty much because it is an oppressive society. but you don't have to go too far away from the studio to find good americans who would say that to have a single payer health care is in itself a tyranny. it depends how you define your liberties. >> host: would he recognize that as -- >> guest: yes, he did, and hayek actually had a slight hint at this. he never addressed to the public and if he were here it would be very interesting to hear what he had to say, because he said the look on the scandinavian countries look on the tranquil,,, civilized sort of places they are actually full of people in the turmoil which

turns out of having the market choices removed from them by the government that's why >> host: this has left you sort of dumfounded for awhile. on that note, let's take a short break. >> "after >> host: so today we talk about the hayekian goal and the keynesian goal and one could easily make the mistake of thinking that those schools just rose faster than the people of my ear to their work and so forth and decided to follow them like twitter. in reality they were actually quite a deliberate builders of the movements and maybe you

could talk a bit about how they sat about creating an army of followers. >> guest: he had a rather simple way of doing it because he had a product to sell if you like. in 1936 he wrote, or by the end of 1936 he had completed his general from so-called general theory where he described exactly how by tinkering with the economy you could make it operate at a higher plane and therefore employ more people at least to a certain faction improved anyway, and because this is a message that so many people wanted to hear, at least in america, and in hartford for instance, when the boxes of the general arrived, they were ripped open as if they were contraband. i mean, it was an astonishing thing. and that desire to be at the forefront of the new and exciting and optimistic movement, which was how to cure the unemployment which is cursed america for a decade, you could see how obviously keynes himself was a very attractive figure, a

very eloquent, very smooth with, had to have that almost a movement waiting to form. keynesians was in a different position because no sooner had the war ended and keynes have largely designed the piece, he was the architect of the peace and design things like the imf. i mean, he designed the brinton -- brentonwood currency fixing the marginal flotation operations. so you wouldn't imagine what hayek was to do. he had an opinion of himself. he always thought he was better known than he was. when keynes died he said before when keynes was alive i was a well-known and a prominent economist. as soon as keynes dhaka he was lifted to sainthood and i was turned into oblivion. and he was profound. this was a lifetime of work and

keynes was dead and for the foreseeable future was kinsey in for three decades can argue to this day i would. economics is keynes. so, in defeat, it shows the extraordinary review of the prosperity that they had and decided after the call all of those people who had resisted keynes and came from the austrian school who were likely to be sympathetic to trying to find an ideology which would counter keynes's wholesale, he invited them all to a hotel when switzerland, in a montclair, i suppose he would call it, and that is the crucible of what turned out to be the tautological revival of conservatism. >> host: when was this? >> guest: 1946.

>> host: and this is also where conservatives and libertarians got in the same bid. >> guest: frederick hayekian invited as many -- i mean, there were a lot. i don't think anyone -- he knew they were never the law. they would invite anybody that looked as if they might agree with him and then left a year after year because from that time on the met year after year after year and they fought with each other all the time. starting out on the saying you are all a bunch of communists. it was lively stuff. it would have been great to be there and to have been invited to that meeting to have attended the first month dillinger meeting is for a modern conservative and ideological bent. rather than having arrived on the mayflower this is absolutely the key. hayek had taken a leaf out of keynes' book. keynes tried in the government in the 20's and 30's to adopt his measures and he had gotten nowhere. the fact is that orthodoxy was

so in control he had the government in britain -- >> host: church always used to have a name but they didn't fight and persuasive. >> guest: churchill did find him persuasive the treasury even more persuasive. the strong arm tactic of the persuasive was more powerful than the audit to the of canes to the echoes keynes. but the rise of hayek's group is interesting, because he decided that he would do just as keynes did with the general feeling. instead of trying to spend money on lobbying interests or persuading representatives, congressmen, senators, presidents as the way to go forward, if you convinced a large body of the academic community, and they taught people and so on, then it would become, it would become much more firm as a theory and would allow people to join in or not to join in as much as they want to come and would provide a

strand of thought what was the contradiction to keynes and that is exactly the way that worked out for all sorts of american large groups, large big business groups or maverick self-made businessman who have always believed that tinkering with the company or the governments get too large is an american thing. >> host: i suppose this led to the chicago boys and that whole movement coming of the university of chicago it was what the free market economics. >> guest: they were already there but you are quite right as they are today or they were 20 years ago. but it's interesting that although free the men and a couple others who were invited to the not too clear meeting they thought it was an excuse to go for the freebie in europe and play bridge. in fact they increased to the foreperson so that they would have somebody to blame. they didn't take it very seriously that they became embroiled in the seriousness of

hayek and his power as i think. in fact, they didn't think much and, as i mentioned before, of an economist, they didn't think the early economics hold much water. >> host: it's interesting because you write as you say keynes today is economics and friedman, who in many ways thought he party what looked to as a sort of lafayette economist. he actually endorsed much of the keynesian free markets in the i guess -- >> guest: he said as much. he said in a way we are all keynesian today which has been led on by the keynesians but he went on to say of course the way that we understand the world is macroeconomic which is keynesian. on the cover and he said, you know, the fact of the government is too large and the only way you can cut the government is to cut the government, stop spending and wait for the pressure of a deficit as much

more stronger president than it is to the spending as it were. >> host: also struck by how another of the heroin of the tea party movement ayn rand she reacted to the road to serfdom with fear of use. >> guest: yeah, i am not saying that this reminds me about those sort of endless debates that used to take place on the left as, you know, luxembourg's has a better or worse person of trotsky, but the reaction was very sliced into groups and the of course hated their next-door neighbor and they hated the person who should have been their enemy. >> host: people trillion to -- fit the mentally. >> guest: she eustis bid at the hayek. she thought he was the biggest compromiser which would come as news to the tea party today. but it's true that i mean, hayek

did say some unlikely things such as if we have this economy i don't see any reason why, for instance, people shouldn't be given proper pensions and health care. everybody should at least half of. that, that was a step too far for people like ayn rand. >> host: and put all the government to provide that? >> guest: this is something that is rarely mentioned by hayek. as much as the logic made perfect sense. if it is going to be private there are some things in the state should didn't he come and that is at least the ability to stay alive and remain healthy. >> host: now, why did he think the state would be capable of funding that kind of welfare as i guess it would be called today? >> guest: it's changed to read i think the national health service is interested in 1945 nobody would imagine the leaps and bounds at the health care itself would take, that medicine would take him at the cost of it

and also we are talking about the pension invented. people were living if you are lucky for years beyond the pension. now because of the good health and actually do to many things in the welfare state that they helped introduce brought about we live much longer and we are much healthier for much longer. so the figures, i am not sure if he had to revisit today that he would agree there might be another way to do it. >> host: in terms of his theories, how much was he actually willing to predict about how the liberal but actually turnout in reality as opposed to little to be like on peter? he lived long enough to see the collapse of the soviet union and the iron curtain come down. was he surprised when that happened or that he predicted? >> guest: nothing surprised hayek. he was one of those people who had worked out in advance. he thought it wasn't always a perfect example of the

contradictory economy. if you -- if you sublet the discretion to spend money to a cadre of communist appellate and take away from individuals, then what you end up with is a society like the soviet union with all of the horrors that that entailed. but also come sooner or later it is going to collapse, because you can't resist the natural force of people wanting to bargain, wanting to trade, to spend, which he thought was absolutely one of the core things that made up humanity. but also, he said that if the price mechanism had been invented, if one day they came out with a contention and said this is what we need to do he said it would be considered the single most important element of human life. and he was to the fact that the prices were the key to everything because that was where the millions, billions of people the world bargained a one-on-one with each other and agreed to let least something.

but he was also very worried much beyond that, and he said it will happen. i can tell you what happens. he was admitting that one of his problems was that when keynes was someone who was a naysayer who and didn't have much to put into place of things shot down. so he can point out of the reasons why keynes was wrong but i wouldn't do anything because there was not what to do. we wouldn't know enough about this stuff. host koza is this the essence of his theory, that essentially things were just to get complicated for anyone in the position of authority to actually be able to know that what they were doing was the right thing or were they morrill out a fundamental view of coming to know, what one's political freedoms ought to be? >> guest: it came up with ingalls. first was just the in a practical one. he said it is impossible to understand what is in the mind of everybody.

and therefore, how could the government agent make the right decisions for every 100,000 for just as many? that is because he wasn't making a proper market decision himself. it was patronizing. he was making a decision on behalf of others, and of course he have other agendas. in his nobel lecture, which is well, hayek said that it was a bit like going to a football match where you knew all of the vital statistics of all of the individuals involved to review their ages, their height, their abilities, their ability to pass, or whatever. and you knew all of that, you knew what the weather was like, you know what the time of day was like, you knew all of the circumstances of the people involved, and then trying to predict what would be the result of the game.

he said it is impossible to know that much information about people coming and we will never reach that state. >> host: that does raise an interesting issue because the movie the money ball basically takes an economist out of the hero, they do the statistics on baseball and they come out with a recruit of a number of players, best value for the statistical performance and then in the end he had a team of i guess ultimately the red sox by employing this approach. i mean, i wonder whether in a sense hayek, had he known the competing power that was available now in the era of the data whether he would take a different view as to the technical feasibility of having the economic policy of the design based on the pretty good information about the world. >> guest: but i doubt it i must say. he didn't believe in the aggrga