rollback. inevitably liberty fill the void. that is nonsense. when you push back on government power, powerful devoid. the most powerful entity fill void. the reason you have government is provide people with a seat at the table. when you push government out of the equation you push people away from the table and markets, although there are democratic beneficial let the market, don't translate into markets in which the good of the public at large are advanced. there are mechanisms by which efficiency is promoted which tends to accrue to entities that have scale. this is better than they serve the little guy and don't create opportunities. that is the punch line of the book. we are in a search for balance.

and this world where you had -- leave it to the state. capitalism and what we saw was communism failed and capitalism won and american capitalism, set the path forward. we had that victory dance because as we have seen american capitalism proven itself to be not extremely good, revitalizing the economy or providing social mobility. it excel that one thing which was promoting inequality which while we have and to build a bridges or created jobs, we have created ever deepening inequality in the united states while meanwhile other models are gaining traction. this is the rise of state capitalism which is a popular term these days.

is designed to oversimplify an argument that you can't even have a discussion. state capitalism doesn't exist. china is what we are talking about and the chinese problem in many places is there is too little government control. there are other places with too much government control. they are not the only ones. capitalism and chinese characteristics, you have small stage for entrepreneurial capitalism. you might find paths in the fourth or israel, for democratic development like big countries like brazil or india or three types of euro capitalism. american capitalism transcendent is a world of competing capitalism and that is the conclusion of this book. we live in a world out of state solvent world's problems but

supercitizens which are the size of a country that you can use any measure you want which is gdp, sales or simply the top 15 countries that are out there. many have more international out looks with empathy. many have more employees, many have profits different from the government budgets of some significant size government. you can't shrug them off and say they are not players in this. you can't deal with global warming, you can't deal with global health or development issues. you can't deal with energy issues. you can't deal with job creation issues or migration issues unless you have public/private mechanisms that we don't have. you have to deal with public/private mechanisms that supercitizens and semi states and big states in some new

measure and we are going to watch as the balance between the players is fought with in national government by this sort of competition among capitalism that is unresolved. the only thing we know about that competition is what we end up with in the twenty-first century is not likely to look like we have in the 20th century and the american leadership that we assumed is in this process is not necessarily going to die going forward because the economics grabbing the world are shifting and throughout history is the economic gravity shifts in the intellectual center of gravity and so other forms may take hold and we may end up with a form of capitalism that is less milton friedman going forward. if it is unresolved. and how it gets resolved will be impacted by the internal debate

we're having in the united states. i know those are the debates that we will want to drop about sir let me turn it over to you. >> thank you very much. [applause] before i introduce the other panelists let me briefly say i look twice now. a few months ago, more recently in preparation for this event and i don't think there's anybody else i know other than david who could start a book with a wonderful but obscure story about a viking god 1,000 years ago in scandinavia and say they discovered the copper mines. and bring it to the book facing the quandary that faces economic policymakers all-around world of different competing capitalisms and how to respond to this david

describes. i don't know anyone else other than david who in a very erudite discussion about population and working reference to that well-known modeler william stock. i can't think of a better name for stenographer than that. let me very briefly introduce the panelists. [talking over each other] >> i am checking the index. as you know the undersecretary of state of economic affairs, and worked for many administrations. the reagan administration, and this administration -- >> amazing you can get around on your own. >> i do my best.

>> in the intervening period is a well-known executive. dan is the author of many magisterial works on the global energy market and global energy upon me and a particularly relevant one is the quest -- his recent book about erratic changes. he doesn't need introduction. let me start with you. david describes competing capitalism a kind of alternate capitalist competition between capitalist models. do you agree with his thesis that that is the era we are in? secondly do you agree with what he argues persuasively in his book that the anglo-saxon version, the american version which to caricature government should get out of the way and markets are always eat fish and

is the one that is most underchallenge and the one most in need -- would you take those two questions? >> let me take the first part and move on to the second. we are in the midst of this year of competing capitalism. let me go through -- david describe eloquently that are competing. let me take a couple steps further. you have state capitalism which david spoke of. we have seen crony capitalism which we have seen in various parts of the world and what i call entrepreneurialism capitalism which is the silicon valley kind of capitalism. then you have small business capitalism which david spoke of which we are seeing in a number of countries.

then you have chaotic capitalism which is capitalism without rules, without effective rules. you have that in various parts. china. the interesting thing is you can look at these with two slices. different countries embrace these different systems but you can also look at it the way david had and that is many view capitalism competing within a single country and in china you have state capitalism in parts of china and entrepreneur real capitalism in parts of china. you have chaotic capitalism in parts of china where people build things without very much supervision. so it is a very complicated environment in which capitalism

competes among countries and with in countries. then you have the second part of your question. is american capitalism under siege? i would say why can't we learn from others? i would say entrepreneur real capitalism as practiced in the united states is in full bloom and very effective. if you go to parts of this country you see among the most entrepreneurial people in the world with new ideas and new products and we are a very -- you also see parts of our system that are very much in need of the infusion of new ideas and new ways of doing things. in particular, i would identify three at elements needed to give various aspects of capitalism a

big boost. the critical element of american capitalism for decades and decades to the early days of this country was vibrant immigration. the best and brightest from all over the world. our capitalism is not capitalism on building things. it is the capitalism of creating new ideas and importing people who generated new ideas. andrew carnegie, if you go to silicon valley, the idea that we are a nation in which capitalism was the result of an environment in which people were able to thrive and attracted people from all over the world. the second is critical, this is vitally important because it is not just attractive all over the

world. operability has been very important. my grandparents came from eastern europe. rob shapiro and i grew up a block away from each other. all families have parents and great grandparents who came from the same area. the notion of upward mobility is critical that parents thought as they put kids to school and got a good education they would do very well. that is a critical part of that. lincoln understood and talked about it, the curse of slavery is it deprived not just white people but african-americans of

the opportunity for a board mobility. they had other people do their book for them and deprive them of this notion of getting ahead. it was a curse for the slave and slaveholder. the third point is infrastructure. making capitalism work today. if you ask me what can we learn from other countries? we need to have a system which continues, to use biotechnology or nanotechnology. we need an educational system which focuses on the kinds of jobs that are needed but enables peopnal system which focuses on the kinds of jobs that are needed but enables people to enjoy the upward mobility. critical to capitalism is the ability to lead fans and the

ability to see the system as enabling you to advance and the third is infrastructure. infrastructures critical. not just roads and ports but information infrastructure because the great power, great driving force of capitalism today is democratization of information and assistance that enable information to flow back and forth. jefferson said you need to have at of information. do we need to learn from other countriest well. e.u. describing great detail

the ship from a bank controlled world to a market-driven world and you caught that moment. given that today we are living in a world where eight or nine of the world's top ten oil companies -- brazil, russia, china, india. is that paradigm under challenge? >> let me congratulate david on his prdrrastination. as a result your book is really well -- will be a great contribution to thet you will see there's a wonderful sweep of history and it clearly is going back to what you were talking about, gloee tl shift i economic power and political power unfolding before our eyes. one is the frontier between

government and markets. have there is loss of opportunity and a good sense of equality of opportunity and if it doesn't deliver in terms of gdp you will see a swing back. that is happening combined with the second thing which is globalization which is also what explains different things. i was thinking as david was talking if we had this conversation when japan was going to be number one than it would have been read capitalism.

for those who don't know what that means, as in german capitalism or french capitalism or japanese capitalism. now we are talking these days about brazilian capitalism. when a lot of it is about china and chinese state companies. it has shifted back but it is going to continued to be a revolution. two things to say. you did have a caricature of american capitalism. it may not be very well done but we like europe are highly regulated society. maybe not well regulated but it is. the other thing is we have a scene, chinese national petroleum company and asking him why are you going to the trouble

to do an ipo? enough problems to report to the policy world and managers in singapore. and against the world economy. i suspect that we will see these companies, disciplined world economy will change these companies because they are caught up in transition and this is a final point. you look at europe, too much government. that the society couldn't support and have to back away from that towards markets. there's more than one thing going on. >> i agree with that as a prescription of grief but not germany. other countries had the german

illusion. they could not generate the wealth of germany. that segways passed the question are wanted to ask which is you describe to the corporation in america as -- human beings from individual rights or amendments designed for individual rights like first amendment. we have citizens united. the right to free speech, corporations and the fourteenth amendment, equal protection happens as well which ended slavery. contrast that in your book with how corporations and places like germany and singapore who have more social contract that was given. what i wanted to ask you was assuming bedford ban and are you worried the reckoning you are

predicting for the american model is debate that needs to be had, disposal be forgotten about given the crisis we have in europe at the moment? very dangerous crisis europe is going through. >> bob and dan both described a process that is constantly on going and the global marketplace we are describing as a marketplace of ideas and, different versions and different approachs being discussed all the time. regulates global financial markets and deal with climate as an issue and providing social safety net and so forth and when things work in one place people look to them to see more of that. the united states is at risk because if inequality is growing and social ability is constrained and not creating enough jobs and the perceptions

some people in society have an unfair influence, creation of super pac and multimillion dollar check to change political activism. if that is the perception that will not gain traction elsewhere. people will look for alternatives and a lot of the best alternatives are in europe. dan said a minute ago we were talking with a german or french capitalism. i recall a conversation with a senior official who said europe is a museum. it is all about the path to the new job at any time. shortly thereafter we stopped seeing jobs and some parts of europe have done a pretty good job and actually if you ask why we have a society -- why do we

create an economy is not just to create wealth for a few people or grow gdp for gdp's sake but provide good quality of life. in some countries with the highest quality of life indicators are in northern europe. not just big countries that small countries like scandinavia and elsewhere and those countries have active capitalism and strong social safety nets. there are paradoxes. in scandinavia outthrust, former finance minister bob shapiro set up a conversation. i talked to the guy about why sweden embraced globalization more than america which you would think we are free market and they are more socialist orientation. it is because there is a safety net. they were not afraid of this. you talk about capitalism.

this leads let saab failed. we didn't pled gm failed. people work and the -- they knew they would go on to something else. which is more capitalist? some people in the united states a week tour of 20 european more. i think if you got higher quality of life and better balance between market forces and government forces you might want to look at it. a lot of those rank at the very top of the list in terms of fiscal responsibility. effective government doesn't mean wasteful government and singapore, israel, models that are involved in trying to help themselves be more competitive.

our job -- to empower our people to succeed in the marketplace. there are certain things government can do. creating the kind of system, government has a role. half of the people say government out is good. it is orwellian. to get to that sort of simplistic approach you're inevitably wrong. >> two questions. when do you agree with that? and -- >> don't step on that. [talking over each other] >> notwithstanding the fact that given your experience, a senior member of any administration, these topics. >> a senior member. >> given your resume and given

the fact -- the history of the last thousand years is competing for the type of war between the public and the private between states and companies. we had this morning a fascinating number more than half the money, and spent by superhacks. that's way of democratic elections is extraordinary. given that you are like many members of this administration and senior executives on wall street. is there a point about the retreat of public power and private corporate power or any sense in any way implicating you in a revolving door? it does qualify you to answer the questions?

>> yes. let me answer the first because part of the answer to the first sort of segways into the second. having observed other governments and the way societies operate i would say the role of government -- there are many areas in which the government plays a role with various regulatory aspects of government power but there are two that david mentioned and underscored which i want to elaborate on because he identified critical elements of what makes a system work and what will the government plays in making the system work. there are two. one is fairness and the other is security. let me elaborate a little bit on both of those. i think capitalism will not thrive. it may work but it won't thrive

if there is a perception of unfairness, a perception that the benefits of capitalism are accruing to a small number of people wear as a very large number of people find themselves disadvantaged by it. capitalism or no capitalism, that notion of fairness is critically important. and therefore -- one example is the depression. in the depression why did we not have massive riots during the depression? there were demonstrations and by and large the depression was not a period of the enormous instability in this country of the kind you saw in the bolshevik revolution and the revolution of 1848 and other kinds of things. there was a general view of americans that there were a few rich people but by and large lot

of people were suffering together and for a large portion of 1950s, 60s and 70s people who work for them and did well. productivity went up. wages went up. when you got a gap between productivity going up and wages not going up, some people doing very well been knitting from the increase in productivity but a lot of workers not feeling they were benefiting and feeling the system was stacked against them. that tends to create this notion of and fairness and you see this today in the attitudes of people. by most polls there's a feeling that somehow the system is not working for the average person. globalization is part of it. there's a view that globalization has caused this imbalance but it is much more

the result of technology with big improvements in productivity and large numbers of people not sharing those benefits. if you look at wages of this country has been relatively flat so you need fairness and there's a perception that the system is fair. in scandinavia you don't have the same gap that you have in the united states. you don't have the notion that the system is stacked against the worker and in parts of this country that feeling runs very deep and you can see it. the other point is the security issue. this goes to another element of what david was saying. the best illustration of that is franklin roosevelt in his monumental book, america at war and in depression. stanford historian david kennedy wrote about the early part of the roosevelt administration. what did roosevelt do? he did not say he was going to

cure the depression. he never said that. he never said he would restore america to rapid growth. what did he say? if you look at his programs they were about giving people a sense of security about the future. social security. security of your bank account. security and exchange commission. he was -- and are a and other things to give you a minimal job where you can have a sense of dignity when you went to work every day. ..

>> what response do you believe is required? >> what you do see is you see that a shift toward natural gas going on is about half of the current content of coal and for various reasons unfolding in the united states, to the tune of what it give to offshore wind is not -- is not a very good industry. the larger challenge in the united states has reached peak oil demand and goes down. the issue is countries david is writing about where the balance of power is shifting. china and india. you can see them kind of in policy rhetoric shifting about

climate change more than four years ago but on the other hand poverty and economic growth is a bigger issue for them so if you see a world where we are now energy demand will grow by 35% over the next couple decades. china, 1 official said strong winds and fierce winds in the northwest. we see them as a natural disaster and we see them as a precious resource when we look at their energy balance which goes up as well. the question is -- it is also very much a question for the new powers david is focusing on in his book. >> the final question to david. your book makes a powerful case for history in context of an understanding where we are today

and this wonderful phrase, temporal narcissist. this idea that what we are going through now is more important than anything else. my question in the context of your previous answer about europe and driving out the merely important headlines every day which is whether a well calibrated and supreme irrelevant book like yours, how it can get through and even with temporary success, easily summarized your book in 40 words. how are you going to get people to focus on a much bigger conversation with what we're having here in america? >> very thoughtful and relevant, timely book at the financial times.

>> you are following -- [laughter] >> the other thing david hasn't announced his he will be issue of book called the 1%. [laughter] but before we open to questions. the we talk about corporations. there's the question about corporations that go all the way back in sweden but what is a corporation today? it is also jobs for management. it delivers goods and services. it kind of gets forgotten that also kind of everybody in this room through retirement. where is the bulk of your retirement savings going to be invested and delivered? there are a lot of things going on when we talk about corp.? when we look at demographics of our country that becomes a

bigger question. >> how can you argue with that? that is a very benign description of corporations. we need to be more aware,. these are complicated things. there is a lot of talk. the average corporation flashing ravine 100th of 1% or 0.one% of their budget on social responsibility. because it is not their job. corporations are big actors. to focus on shareholder return. that is fine.

you can't leave those powerful forces. you have 2,000 corporations in the world that are bigger than the smallest countries of the world. you can't leave them out and say here's a benign things so we will let them take care of you. they can handle global warming. exxon has emissions equivalent to taiwan. it produces oil and gas -- it is the kind of player you have to reckon with. you can't count on the kindness of thatcher. a lot of policies of the clinton administration -- if we get out of the way wall street has these nice guys and what will happen is -- creates and great financial products and will reduce risk. all these derivatives.

there with a potential consequence of class? no. we trust them. recently we discovered -- you have to balance these things out and we need new mechanisms to balance them out. missing all the marks at the beginning and the front row. and it is very canny but anne-marie has written a new book of institutions. the bold states trapped within borders of companies which are designed -- we have these -- we

expected these to the week. we saw things like the syria vote. they were badly designed. what we were confronted with is a watershed moment. where corporations -- they pursue their interests unfettered. that will cause a problem. they can't control their borders. they can't enforce their own laws. companies go somewhere else with better laws. may be 150 countries are semi states. we have a bunch of dysfunctional institutions. somehow we have to remake that. we can be hopeful about that but what we also have to recognize

-- we have moments when the institutions animals don't line up with the forces of players, we have chaotic circumstances. the risk of that is higher than it is until we start remaking things in a way -- >> let me add one thought to that. the global government system was not made for this year of dense far-flung interconnections. one thing that is interesting as a player on the global scene, really interesting when you go out of the conference -- you have widely distributed capability to monitor the environment -- monitor wildlife and wide range water quality to monitor working conditions all

around the world. widely distributed microexpertise watching the role of government and interconnecting on a level never before and it doesn't mean ngos are not countering the concerns you mentioned that at a new voice and what is more important they had a whole new dimension of information. so you have in a way a third force out there. the press used play that role and the press runs to a degree but added to the press are the people's communication. everyone has a voice on the internet. >> the difference is the gates foundation put as much money as the who does. it is not accountable -- board

the point is you can't be for too much to ngos because we want people resolving these issues to be accountable to the people at large and not just rich guys. that applies to the whole range of issues. >> i am suggesting they are in better position to hold government and business more accountable than they otherwise would be. >> i take issue with one thing. benign interpretation about corporations. 401(k)s became 201 ks. >> was selective. >> this is a wonderful moment bigger moral compass and temporal narcissism and the kind of company -- for population experts, it is of to the

audience. do we have a microphone. take the mike and declare yourself. >> there is a hand. >> in the third row. >> i am dr. caroline conklin. i am a physician and attorney. i graduated in 1969 when capitalism seemed a little bit different. i was wondering since this is about different capitalism models if you could comment on the allocation of capital in this country it seems bain capital leaders and not an adventure capital has to be but private equity capacity. takes money out of companies. it leverages them up and uses the money to pay off someone else and tries to make the company more efficient.

the money it took out went to finance something more productive that would be great. it seems the financialization of the economy led to more bubbles and secular ventures. >> where the money went primarily was to the california teachers and ohio state workers because those were the investors. that is to their main investors were. >> my late husband was chairman of pension benefit guaranty corp. in the clinton administration. >> you had some quick -- if you like --- >> who controls capital is an important issue because it drives the direction of society. i have no objection to private equity companies going out

there. they help something growth and promote the creation of jobs, they sometimes are a little callous about it but i don't know that that is their responsibility. if we have a system that took care of people better in terms of dislocation, it would encourage that kind of entrepreneurship but having said that we have seen an enormous concentration of capital in the hands of very few people and the enormous concentration of wealth of a very few people and so the top several hundred people in the united states control more wealth than the bottom half of the population. i am all for creating incentives within a society but when you get to that point you are creating a disproportionate distribution of power.

the ability to write checks to superpacks or influence who goes in and out of office for the ability to determine which companies succeed or fail to a greater extent than other people so i think there are legitimate questions raised about how the profits are taxed and how that money gets distributed and how people are compensated in those companies and i think we have come to a moment where those questions should be coming up but it says something about the nature of our system and imbalances within the system that we are not having a serious conversation about that. in the wake of the crisis we had serious reform in the areas, certain areas of risks that you thought you had seen and we are not having a serious discussion about these issues about fairness. we brought some discussions -- part of that is due to the other end of town and complete stasis

that is capitol hill. >> i would like briefly -- that question. somebody right at the back -- i see a hand. but yes. no. okay. >> my name is rachel kodel and i have a question. in looking at the problems in modern capitalism and these different competing capitalisms, some are better at deciding things like a social safety net and mitigating inequality but there is this understanding that capitalism doesn't provide human needs and promotes culture of

materialism and consumerism. do any of them seek to find ways to return better sense of community or local ecology and those sorts of values better than other systems of capitalism. are these -- the buddhist economics summit advocated in the past -- and the localism movement? any way to work that into the modern capitalist system and address those psychological needs? >> the short answer is democracy. economic systems don't fault the problem. you need a balance between economic and political systems and you need political systems to function effectively on behalf of people at large and identify priorities that the direction of the assets of the company to those priorities and

places where democracy isn't functioning very well on places whereby major markets can't do the most for society. it comes back full circle to this notion that he need balance and effective forms of governments to set social priorities. i agree absolutely that markets alone won't set priorities that serve society as a whole. we don't have consciences, they don't have the vision. they tend to serve people who have more than people who don't have. we need to find a balance. >> i would add one foxthought . allen's is what we're talking about. when the system is perceived as

unfair by a large number of people there are remedies. we have gone through this in the past throughout the industry to rebalance and maintain. vigorous capitalism. it is not either/or. it is the framework in which capitalism operates that is the key element. you can have very vigorous capitalism where there are balances in the system that avoid the large imbalances in terms of opportunity or wealth without undermining the capitalist system. citizens united issue which david talked about troubles me a bit in the sense that it creates the impression of poor decisions and what happened afterward that a great deal of wealth in effect

enables you to exert a great deal of political power because of the way the decision was written and the amount of money that followed in very concentrated forces. i have no objection to people exercising their freedom to make contributions for their freedom of speech but they are not exactly the same. therefore it does seem to me that part of the notion of a system that is balanced in which there is not a great deal of concentration of wealth brought to bear in the political process and a great deal more equity in the distribution of the contribution of the political process because it gives people a feeling that there's a greater opportunity to have a voice. if they as individuals can contribute $100 and someone can

contribute multiple times that, politicians pay more attention to the latter rather than the former and that is corrosive of the democratic system and therefore something of a over period of time will weaken the confidence of people that the system of government is going to write imbalances. whether it will not i don't know that there's a widespread perception about it. >> i will go one step further. the notion that citizens united, money is speech doesn't weaken democracy. it fundamentally undermines democracy because it creates the concept that some people have more freedom than others. if you have more money you have more freedom of speech than somebody who have less money and that is in equitable.

the corollary that goes with this which bob was talking about, bill bradley was running for president a few years ago. the purpose of our society is not just creation of wealth. the purpose of our society is to enable people to have better lives by lots of different metrics. if we judge our success on the basis of whether gdp is up or down or the stock market is up or down we will make the wrong kind of policy decisions for society as a whole. >> let me use one example. the middle east was an area with a lot of growth. was not inclusive growth. lot of people did not enjoy the benefits of it. one of the things that is important, why the market economy, large number of people see the benefits of the growth. or able to participate in creating that growth.

that is troublesome. we see that and time is short. >> among many things in this book that go to the dogs, one thing -- there's a difference between pungent and 0different. david describes the revolution that going through the 90s, easy globalization and underestimated dislocation associated with profits and that is part of the team you are writing about this book. i don't think david is advocating we adopt the motive of state-owned chinese companies. the question in the back looking to scandinavia if we are going

to rebalance one motive. >> there are lessons there in singapore and other places where they take a more competitive -- there are a host of things we could learn from a lot of places but i agree with your point. >> i would like to suggest that there is a third element here. it is not just about the state and capitalism but about culture. when we describe the american corporations and has not bearing social responsibility because it is not their function, that is a cultural statement. that is true in the united states. is not true for lots of other cultures. it wasn't true and hasn't been true for japanese capitalism and is not true in lots of parts of

european capitalism as well. >> referring to tokyo power and light specifically? what are they doing to companies? >> let me give you a clear example. corporations all over the world, executives in corporations all over the world effectively have the ability to set their own conversation. top executives. there are compensation committees that are appointed from boards of directors most of whom are appointed. the corporate culture says this is acceptable for ceos to compensate themselves at an average of 300 times the average today. the average worker. in europe where they have the same power to do that.

it is about 40 or 50 times. it is part of the culture that that is not acceptable behavior by corporate ceos. and more responsibility for helping workers manage conflicts between home and work. there are laws but those laws -- >> can i ask you a question? stipulate that your trend analysis is correct and the gap is widening. it hasn't always been american culture. if it is culture it is a recent culture, not a traditional one. why do you think it has become more recent as opposed to more traditional? i am curious. which analysis lead you to that? that is an interesting question.

>> it has increased seven times since the 70s. it is ten times -- they make 300 times more than the average employee now. it goes back to financial location -- financialization . another part related to culture is how you think of a corporation in its role and how it is constituted. one of the things rob was referring to is in german corporations, boards are much more separate from management and you have got a structure that tend to therefore produce actions and unresponsive, it did not arise out of a war between

business and labor. [talking over each other] >> compensation levels in india, china and brazil, american. this is the recent model. remains to be seen whether the chinese model and large companies with huge benefits from governments are able to sustain that and perhaps their governments are not willing to provide large sums of money and other countries that want to compete with the chinese model they find instinctively while it looks good for them to have state capitalism they're competing against a country with very deep pockets. one thing they need to decide is whether we might think state capitalism model is a good idea

if you're competing against a country with $3 trillion and you only have $100 billion in the reserve trying to compete with state subsidizing companies or export credits or electricity. a lot of those things might not be attractive. what works in one country may not work indefinitely and they may themselves want to make their model more efficient or more benchmark to international standards. >> one version of capitalism triumphed over another. we are heading for the hybrid form of capitalism and the thing for americans that is wrenching in all of that is the rules we are going to play in the turning what that hybrid is is likely to be less than the role we play in determining what it was in the past. we can determine how much it is by how any label --

stimulateable we are. but in asian capitalism the chinese are looking for models with in china and outside china. it is changing dramatically. singapore might be a model or other kinds of models. this hybrid is evolving all the time. >> time for one more? >> curious about the issue of what economists call regulatory capture. regulatory manipulation, whether it is in the financial area or oil and gas. with larry summers's speech with december of 2000 credit default swaps which happened in the clinton administration what led to a lot of this as we know. i wonder what the speech would be like. and bipartisan things as well. how do we balance regulatory

manipulation if you look at the financial sector, last ten years 42% of profits before traditionally for decades and decades is that fair? has to do with regulatory capture. make a comment about that in the context of your overall discussion. >> wasn't quite sure about your question to me but the second-half, we have a minute. i will defer these gentlemen. >> i think ed will answer this question. >> what will your speech be like in 2000? opposing regulation -- >> what you need to know is who was the speech writer? ed. [laughter] >> i just want to clarify that. >> your question right there.

>> this crony capitalism have a point? to put it starkly are we not -- does not the present system have its own destruction the next time the bubble bursts, we have to let more than lehman brothers go and we will be back to a depression and there will be the basis for fairness and security? i had a happy childhood in the depression. wasn't all that bad. it certainly does not speak well for the future of american-style capitalism. >> i know that -- we have to wrap it up. the best possible way to wrap up a discussion like this is on that note that the depression

which we see lurking might not be so bad for all of us. i would like to end up on that optimistic note. certainly this system has the seeds of its own destruction in it and certainly right now we are not addressing those seeds as aggressively as we should if we recognize them as the seeds of the destruction of the system so part of the point of the book is to say what's stop. let's use things in a historical context and understand what our long-term trend rather than short-term trend and try to understand what is setting this model back and what are the gaps in the international system that we have got because so much evolution has taken place since the last major revision of our thinking about how that hr operate whether read the end of the second world war or the treaty in the middle of the seventeenth century i am not sure. some time between those two

there was a revision and we need another one. the point of the book is to trigger a discussion like this outthrust. what i would like to do before we conclude finally and thank everybody here to offer a few housekeeping notes i have been given. if you go out the door and go downstairs there is cocktails' and food and stuff at the carnegie endowment. i want to thank the carnegie endowment which is my home or more books that i have done and has been a wonderful place to work on these things and a fantastically convivial atmosphere which provided me with what i see over there and i see where he is who have been the mastermind of research behind this project and have done a spectacular job. there are others who have been helpful and cited including my wife who has been patient through all this.

and also my colleague gordon russell and elsewhere. the file housekeeping noted which is your spectacular good fortune is that thanks to an anonymous benefactor downstairs you will find a for copies of this book for everybody. if you go downstairs -- [applause] -- you could have food and alcohol and free books and if you want i will even sign the book. thank you very much. [applause] >> you are watching booktv on c-span2. forty-eight hours of nonfiction authors and books every weekend. >> the sea-tac folks -- why here

in this crowd? >> will all work out. we will unite at the end. if your republican nominee we will hold you accountable. people have been burned before and don't want to be burned again. it is a reality check for a lot of people. i don't get this sense of everyone is afraid. people are excited. all the candidates have done a good job. mitt romney was strong, wreck was terrific and we will hear a lot more in coming days and this is good. this is a very good thing. >> host: how do you assess the ratings? >> guest: rick santorum experiencing what other candidate to experience. can he take it now? mitt romney will turn it up and has the organization to do it. he can fly by the seat of his pants for a while but not for an entire primary season. >> host: good luck. how are you?

>> thank you. take care of yourself. how are you? my head is down. how are you doing? having fun? good to see you. they will do it for you. you can do it right there. all right, goodbye. how are you? take care. have a good one. how are you? how is it going? enjoy it. you will laugh. i promise. how are you? >> good. how are you? laughed. how are you doing? it was a little -- great to see you.

how are you? glad you made it. i am hosting o'reilly tonight. the worst timing. thank you. sorry i am so late. nice to see you. thank you. how are you? >> good. how are you? >> thank you for being here. >> good to see you, thanks for

being here. hello, how are you? >> good. i appreciate it. >> did i make you laugh? >> how are you? >> i'm great. >> how are you? it's great to see you. are you having fun here? >> wonderful. >> are you excited or -- looks like you're having fun. >> i am. >> how are you doing? >> fine. >> great to see you. >> great to meet you. >> i love watching your talk. >> thank you for watching. we need you to support that. watch oreilly tonight. i'm hosting. >> nice to meet you in person, huge fan. >> back at ya.

years ago when the queen what as a garden party at buckingham

palace, greeting a selection of guests, she was asking such standard questions as, have you come far? when one woman looked at her and said, what do you do? several days later, at a friend's birthday party, the queen described the exchange and confessed, i had no idea what to say? it was the first time in all the years of meeting people that anybody had ever asked her that question. well, my job in writing "elizabeth the queen" was to explain what she does but to tell what she is really like and to take the reader as close as possible to elizabeth the human being, the wife, the mother, and the friend, as well as the highly respected leader. today i'm going to talk first what it was like to write about queen elizabeth, and second i would like to share if you you

the many surprising discoveries i made about the queen because she is the best known woman in the world. people feel as if they know her. but the real woman is very different from the woman in velvet. this is my six until biography. all of them about larger than life characters that barbara mentioned, but there is no one like the queen. and she lives in her very own remarkable world. while other heads of state have come and gone, elizabeth i the longest serving leader in the world, spanning the 20th and 21st centuries. she is the 40th monarch in the thousand year history of the british monarchy. reigning over the united kingdoms of england, wales, scotland, and northern island, along with 15 realms and 14 overseas territories. she is the second monarch to

celebrate a diamond jubilee, marking 60 years on the throne, which is a milestone she will reach on february 6th. the only other was her great-great-grandmother, queen victoria, whose celebration was 115 years ago. in 1897, when she was 78 years old. if elizabeth, who will soon turn 86, is still on the throne in september 2015, she will surpass victoria's reign or nearly 64 years. between the two of them, victoria and elizabeth have been on the throne for 124 of the last 174 years. and have symbolized britain far longer than the four men who were kings between their reigns. elizabeth is always surrounded by people, but being queen makes her a solitary and singular

figure. it's crucial for her to keep a delicate balance at all times. if she seems too mysterious and distant, she loses her bond with her subjects. but if she seems too much like everyone else, she loses her mystique. she doesn't carry a passport. she doesn't have a driver's license. although one of their cousins told me she drives like a bat out of hell on the roads of her country estate. she can't vote. she can't appear as a witness in court. and she can't change her faith. and because of her hereditary position, everyone around her, including her closest friends and her family, bows and curtsies when they greet her and say goodbye to her. although she was trained by strict nannies who prevented her from being spoiled, she was also trained from childhood to expect this deference.

a friend of mine told me about the time when, then-princess elizabeth, came to visit his family cass until scotland, and he play flew threw her on a sofa. his father, the 12th earl, took him by the arm and punched him in the stomach and said, don't you ever do that to royalty. the princess didn't mind, my friend told me, but that we structure in which she was brought up. how does a biograph fer, particularly an american, penetrate the role bubble, especially when the queen has had a policy of not granting interviews. actually, it really wasn't too different from the way i approached my other books. which was to turn to those who knew her best for insights and information. i am a long-time anglophile and

have visit britain over three decades and have made a lot of friends, some of whom helped me when is was preparing by book on the late princess diana. when i started researching the queen's leave, i went back to key sources who agreed to help me again and introduced know more people who newell the royal family. they also served as my advocates in getting cooperation from buckingham palace. my book on diana had been fair to the royal family, and particularly to charles, so the senior staff at the palace briefed the queen and they gave me the green light. as a result, i had access to her inner circle of close friends and advisers. while the queen has disciplined he was to keep her views and emotions under wraps in public, those close to her shared with me some of her fascinating opinions and feelings, what

worried her most about prince charles when his marriage to diana was falling apart, for example. what would happen if she became physically or mentally incapacitated. and even some politically sensitive opinions, including one hot button issue that she discussed with an american ambassador. her friends explained the secrets of her sir reinty and courage and sized her up sometimes in unusually perceptive ways. monte roberts, the california horse whisperer, who is one of her most unlikely friends, told me that when the queen gave him good advice, she showed an incredible ability to read intention just like a horse does. with the assistance of the palace, i was also able to watch the queen and prince phillip in many different settings, at the garter parade at winsor castle, while presenting honors at

buckingham palace, investitures and one of their annual garden parties at the palla. for that i received a personalized invitation on white paste board, embossed with gold with the queen0s crown and cipher, announcing the lord chamberlain had been command by her majesty to invite me. everybody got that. watching the queen at that garden party make her way along a line of people, i was struck by her measured pace. her lord chamberlain, the senior official at buckingham palace, later told me that she moves slowly to absorb everything that is going on and to take as much in as she can. i also marveled at her mastery of brief but focused conversations and her sturdy stance, a technique she once explained to the wife of one of

her foreign secretaries by lifting her evening gown above her ankle and saying, one plants one's feet apart like this, always keep them parallel, make sure your weight is evenly distributed, and that's all there is to it. as i observed the queen over the course of a year, i accumulated impressions that helped me understand how she carries out her role, and how earnestly she does her job. with great discipline and concentration in every situation. she is not just a figurehead. and she has an impressive range of duties. every day, except christmas and easter, she spends several hours reading those government boxes that barbara just described. they're delivered -- red-letter boxes that can only be opened by four keys. she reads them in the morning and at night and even on

weekends. one of her close friends told me about the time during one of the queen's visits when she was desk-bound all morning, must you, ma'am? her friend asked in the queen replied, if i miss once, i might never catch up again. mary, the youngest daughter of the queen's first prime minister, winston churchill, told me when elizabeth was a young 25-year-old queen, he father had been impressed by her attentiveness that she always paid attention to whatever she what doing. it's hard to imagine the amount of information that the queen has accumulated over six decades, and she has used it in exercising her right to be consulted, to encourage, and to warn, when she meets with government officials as well as senior militaries of, clergy

men, diplomats and judges, who come to her for confidential private audiences. as she once said, the fact there's no-else there gives them a feeling they can say what they like. the most important of these encounters have been the weekly audience with her 12 prime ministers. consider the trajectory. from churchill, who was born in the 19th century and served in the army of her great-great-grandmother, queen victoria, to david cameron, her current prime minister, who was born three years after her youngest child, prince edward. she actually glimpsed the first of her -- for the first time her future 12th prime minister when he appeared at age eight in a school production of toad of toad haul with edward. probably her most fascinating relationship was with margaret thatcher, and in the course of my reporting i gained some great

insights into how that relationship worked and some of which contradicted the common view. the queen does not have a executive power. but she does have unique influence. in her role as head of state, she represents the government officially at home and abroad and also serves as head of nations, which means that she connects with people to reward their achievements and remain in touch with their concerns two decades past the normal retirement age, she still does something like 400 engagements a year. traveling around the united kingdom to cities as well as tiny hamlets. charles poll, who served as private secretary to both john major and margaret thatcher, told me the queen knows every inch of this country in a way no one else does. she spends so much time meeting

people she has an understanding of what other people's lives are like. she understands what the normal human condition is. she is also spent an extraordinary amount of time honoring citizens and members of the military for exemplary service. in 60 years, she has conferred more than 400,000 honors and awards, and given them in person over 600 times. people need pats on the back sometimes, she has said, it's a very dingy world otherwise. traveling with the queen was particularly valuable, especially the overseas royal tour i took to bermuda and trinidad. she was 83 years old at the time and her program called for long days of meeting and greeting. her stamina was impressive. matched only by 88-year-old prince phillip. whenever they go off on a trip together like that, the lord chamberlain always accompanies

to the airport, and phillip turns around and waves at him and says, mind the shop. i got a real sense of how much in synch phillip and elizabeth are. with an expert choreography like fred astaire and ginger rogers. i also saw aspects of him that contradict his caricature of insensitiveness. he always watches the queen carefully in case she need assistance. i once brought a child over to greet her. he often spots people in the crowd who can't see well and he will walk them out to give them a better vantage opinion. when the queen needs a boost, he is there with a humorous aside, such as, don't be so sad, sausage. on the last night in trinidad, i also witnessed a close range when i had heard about from several people, that the queen doesn't perspire.

even in the hottest temperatures. the british high commissioner was hosting a garden party in his hilltop home on such a steamy evening that everyone, including me, was dripping from the heat. but after an hour of lively conversations with some 65 guests, the queen walked past me, very close by, and there was absolutely no moisture on her face. one of her cousins, who traveled in the tropics with her, explained to me in her own way that the queen's skin does not run water. and that while it may look good, it does make her uncomfortable. i saw further evidence of this a year later on a july day, at ground zero in manhattan when the temperature hit 103 degrees. and one of the women, the queen spoke to said to me afterwards we were all pouring sweat but