to deal with it. on this specific issue of the secretary, what is more robust than a judgment inquiry with minister is under oath holding the bible, wang larose, answering questions. that is the point. >> on wednesday, the secretary of state told this body that the permanent officers have agreed to authorized and approved of this action. on thursday, the permanent secretary refused to 10 times concern for my committee that this was the case. on friday, he then wrote to me stating merely that the tea was aware and content. the secretary of state failed to provide full information to parliament or the secretary of

state failed to require his subservience to provide accurate information to a assembled committee. both are breaches. of the ministerial code. >> rather than brained noisily, let's allow the question to be finished. >> both sides of ride roughshod over the rights of parliament. >> there was an appearance and what the ministry secretary said he backed with his assistance said. when asked to clarify, he made clear that he agrees the arrangements within the department as i said in my statement and he was pleased

with the role of the special adviser. i know the gentle lady allows our committee to drift into these kinds of things but she is completely wrong. >> there is an urgent need to restore public confidence and the processes lead to decisions in this process and to achieve that, an increase to be held in the open in which witnesses give evidence in public subject to cross-examination and under oath. well the concern -- if there is concern is that questions remain, he will refer that to someone else. >> i can give you an insurance -- having seen some of the inquiry on television, it is mentally powerful that people are questioned under oath. that is far more robust than anything the independent adviser

or sell the service can provide. i am not waiting for leverson to complete his investigation. if an amazing comes out that shows anyone has breached the code, i would act. this is the right way to approach it and i think people should respect the integrity of the fact-finding mission. it does not remove from me the necessity to plead for the military code. that is my job. isone of the clear duty iies before the conduct of the special advisers. given what the prime minister knows already about the possible dereliction of duty, why is the minister still advising him? are there not matter is under the ministerial code which now

merits investigation by the independent adviser? no one understands why you are seeking to shut this behind a smokescreen. the duty to do this is on you. >> i respect your right of the gentleman and his experience in government and he would know that i consulted with the cabinet secretary. what is the right process to follow to make sure we get to the truth and we deal with this issue? the right process is to allow lord leverson to find the facts of the case and if there is any question about the minister of code being broken, i can then acts. the ministerial code is absolutely clear. ministers are responsibile. >> given that the role of the

adviser of a ministerial code is purely to advise the prime minister on whether the minister's actions are in breach of that code and not to investigate or establish the facts of those actions, is an essential to allow the inquiry to establish the fact and the advance that they discover there is a prime offensive, then they need to refer it -- referred to the ministerial adviser. >> you are entirely right. it is worth examining what would happen if you commission that the independent adviser to set down a process of factual discovery. you have to look at all the information that is about to be provided l to theeverson finding and would duplicate the facts. >> the prime minister has just

claimed began at in relation to theb sky b, that the government had independent advice every stage. will he confirm that on december 31, 2010, the government was advised to refer the bid to the competition's commission. the government did not do so. they both said last week and it is simply not true. >> we were acting in accordance with a law passed by is government, the enterprise act. this requires you to consider the company's reputation to you in terms of reference to the competition commission. if you don't take that into account, you could be subject to judicial review. i said that aid each stage, he took in a bad advice and all

that independent advice of correct. >> all sensible people will welcome the approach. but will he agree with me? what appeared wrong to rest the judgment and that he has a duty to follow as does the process? >> i think this is right. this is something we can recognize if you go back over 10 years in politics, it is the easiest thing in the world for a prime minister to say to a member of congress that it is getting a bid to the gulf, you have to let go -- be let go. i believe we need to get to the facts, it is natural justice and we should have more. >> the prime minister is aware that machinery has been in place for investigations in relation

to the preacher codes of conduct for many years because of context of a citizens and members of the house of commons. why doesn't the fight -- prime minister implement that instead of going to a third party? >> kenyon across as that is more robust and that a minister having to provide under of information to incorporate the answer questions and under oath and knowing that all the time, anything in that information if it breaches the ministerial code can trigger another judgment. that is what is happening. that is what i agree with the cabinet secretary. i am absolutely convinced it is the right approach. >> this morning, i checked with my office to see if there are lots of complaints about the department that colfer made during sports. mrs. bone said there were hundreds and hundreds.

they wanted to know why harried was not becoming the football coach. she wants to let the prime minister get on with running the country and getting results. >> this is important but there are many more important issues like jobs and living services and dealing with the debt that we should be getting on with. >> all these problems stem from the prime minister's original judgment. having taken responsibility for the news corp.bid for b sky b away from the business secretary because he was sympathetic to news corp., it was stupid of him than to handed over so that because the secretary was already on record and in favor of the bed >> i don't accept

that at all. it was not just antipathy. he was recorded as saying he wanted to destroy this visit. he could not carry on running that part of his department. i sought advice from the cabinet secretary and the cabinet set -- cabinet secretary as to the secretary of state. >> the prime minister just reassure the house that we are getting maximum value for money in these cash-strapped towns in the office of the independent adviser. [laughter] >> yes, i can. >> i was at the meeting of the public committee where, according to the prime minister's the statements just now, the press secretary said he

approved the approach which was taken by the department in relation to using adam smith as a conduit. the press secretary said the secretary of state made a statement and made it clear he is providing full written evidence for looking forward to providing normal evidence l to theeverson inquiry. this makes no reference to the ministers of parliament, how can lleverson deal with this? >> let me be clear -- the approach was approved taken by the department to the clause i- judicial process. this included adams met acting as a contact point with news corp.. it is normal and required to have contacts and a promise secretary has made clear that he was aware and content for adam

smith to be one of those was a contact. you can keep digging into this area but i'm afraid is not getting anywhere. >> could the prime minister tell us if he like other prime ministers have zero telephones of the murdoch empire? does he think what we see here today, but call for openness? >> i am perfectly prepared to with a relationship between politicians and media proprietors and it got too close. the party opposite has not revealed any of the meetings they had while they were in government. we have been completely transparent. >> of prime minister has relied l on theeverson process.

in doing so, by providing the leveson to mr. frederick about b sky b. >> it is a judgment inquiry. he is able to ask for any papers or materials and this government will provide it. >> mr. speaker. the principles of fair play and natural -- it should be determined after the secretary of state had the opportunity to give his side. the most -- it is more about the failure of opposition and the people of britain.

>> i think the motivation is they would do anything than campaign. >> i am willing to keep them here as long as they like. that's my guess. >> the one fact that they cannot get away from is the fact that james murdoch knew in terms what the secretary of state was going to say before he said it had before commercial operators in opposition to murdoch knew it. is that clear example of collusion and a shabby deal between the prime minister and murdoch? >> i would have thought that when he stands up in this house

should make an apology. he stood up last week and claimed a series of facts, based on privileged access he has had. the facts turned out to be wrong. a man of honor would stand up and apologize. >> speak up. [unintelligible] >> that is in sharp contrast to a process, directed by the high bidder. >> order, order. most questions have focused on the terms of the urgent questions.

that was a million miles away from it, completely out of order. >> a proposed takeover bid it was given the same level of scrutiny as the b sky b has been given. >> the transparency and scrutiny has been a proper process. he took steps that were not welcomed by news corp. he was open and taking transparent advice. >> getting better employment rights than the rest of the workers in britain? is it possibly because he knows that whatever the culture

secretary is in the private life, it presents the bully from hitting him, the prime minister. >> he can take his pension at any time and i advise him to do so. >> mr. speaker, i welcome the open process. i welcome the prime minister who will be responsible for insuring his government -- require lord justice leveson to report directly to him. >> the report is going to be a major political media and regulatory event. he is reporting to everybody in parliament and politics and in public life that cares about these issues.

we have an opportunity to deal with relations between politicians and the media, which have not been right in this country. >> the secretary of state -- the only way the minister's communicate with the special advisers is through e-mails. why has the prime minister forgot the letter that a resignation delays is a disgrace? >> what i would say is if he is concerned to make sure that all the information is properly looked into. what is preferable -- where you can look at papers and ask questions or a inquiries with

ministers asking questions under oath where all of the documents have to be revealed. this is what i do not understand or the opposition is coming from. if you want full disclosure before making a judgment, this must be the process. >> in a previous scandal, a respected member of this house suggested the prime minister did not take responsibility. why he thinks the situation is any different now? >> taking responsibility for your special advisers means coming to this house and explaining what is happening.

he gave his reasons for resigning. he has not broken the ministerial code. >> when they have the opportunity to question the this is an-- important issue. when the parliamentarians get the opportunity -- a key person was the special adviser. >> it is up to the door justice leveson. -- it is up to lord justice leveson. in this house, you are able to call whenever you like and you can ask those questions. about the way the department ran

the process -- all the parliaments have been written to. >> would my honorable friend agree that a company which would sack the director would never achieve anything worthwhile at all? >> this argument -- if ministers resigned every time something was wrong, we would have a new government virtually every week. >> the real reason the prime minister is reluctant -- if as a result the secretary of state were forced to resign, he would find himself on the front line having to answer from every revelation of the code between

the empire -- as a result, is it not inappropriate that the prime minister who has a vested interest should take this position rather than parliament itself based on a stunted motion of the house. >> you can find any kind of explanation you wanted. you could go to the simple one. the best way to find out the facts is to allow it to run its course. that is the answer. sometimes the simple explanation is the right one. >> if any major business was bidding for a company, it would

be normal for them to of dialogue with the departments involved. >> it is important that the dialogue is carried out appropriately. the special adviser to not act properly and that is why he resigned. there are wider issues. we should get this right. >> people will compare this to the cavalier way for television in wales. this is small in the grand scheme of things. >> i did not accept that. we have done right. this has been a great success. look, all media companies have

their great causes and lobbies. you get as much pressure from the bbc, from regional newspapers about things that they are concerned about. that is worth putting on the record. >> we should remember just a week ago he said we should let them do their job. >> that is exactly what he said. i think it is right that the leveson inquiry take its course. a good headline 23 minutes after the -- >> mr. speaker, this is

something that concerns me, the role of the special advisers. people work closely with their minister. i do not believe the prime minister does not know that the special adviser must have known everything that was going on, hour by hour, day by day. >> all of that information it is going to be provided to the leveson inquiry. the special adviser has been clear about the role he plays and that he went beyond anything he was authorized to do. the difference is these people are going to be answering questions under oath, questioned

by barrister in a court. >> they would almost be heavily guided by the leveson inquiry. >> i think my good friend makes a good point. you cannot guarantee an independent adviser would be quicker. it will be cutting across cutting what levelord leveson is doing. i could not be clearer about it. >> he did not discuss this with james murdoch.

i wonder why he felt unable to admit -- >> i have not had any inappropriate conversation about this issue and indeed i haven't . it is important to record everything you possibly can -- to report everything you possibly can. a minister said he was trying to destroy it a media company. it was inappropriate for me to say that was not correct. that was a sensible thing to say. >> i share the mystification -- this has been a breach of the

ministerial code. >> she put her finger on it. he does not want to wait for the evidence or the information. he saw a crossing band wagon and he jumped on board. >> the culture secretary said he would publish all the documents, all the exchanges between my department and news corp. does he no no problem whatsoever? >> his answer was given to explain the situation. >> mel stride. >> a civil service inquiry would have no power to summon the

minister under oath. would you agree that the best way to give the secretary state the best way to find the truth? >> i do not want to belittle what the cabinet secretary is capable of in terms of proper inquiries, because this has happened in the past. the process we are engaged in is many times more robust in terms of getting to the case about the facts. >> mr. speaker, what does the prime minister agree that sensitive information -- in advance of an announcement that that would bring a breach of the

code but also illegal/

>> i voted for the amendment of animal had a lot of discussion about it. i said i could vote for it as written though not presumably

for the same reason he which to imply and the dropping of it. it is i think, absolutely astonishing this was not known until later. that is because in my opinion people lower down the chain of command did not make it adequately clear what was going on. there was in my opinion deliver to the attempt at a cover-up that was made. therefore, i completely agree it was astonishing that people were not more open. for that reason i supported the amendment. my colleague failed -- which is placed on it, and was not supported i think it's amazing that this was not laid bare to senior management at news corporation when it happened. >> your question which is about fit and proper, if we said it was astonishing, i think this is something we have to i think respect in some ways what the

inquiry was about, which was about whether the knowledge of phone hacking and the action people have taken. we didn't take evidence looking at -- therefore i think difficult for us to take a few about the way it was perform any operations within a company. you must be very critical about that, not critical language about the way which people had run the business and the decisions they took. i certainly think the performance, the votes against the section on rupert murdoch, there was no evidence linking him directly to knowledge within the business. now, people may find that astonishing but nevertheless that is will the country. i think it's quite important we did draw that line. in our view we should focus on the evidence about what people in the organization new. as i said, people's failure to see the lights flashing on the dashboard at the company when

they were clearly lots of warnings, problems within the organization. >> can i just very briefly, i drafted the amendment and i'm certainly not a lawyer. we follow the evidence, follow the evidence. with james murdoch, for example. given the conflicting accounts and the history of what we have been told by witnesses going five years, we simply couldn't make our minds up with any conviction about whether he misled or not, time possibly retail if other evidence emerges. it was important just to get our heads up, look at the bigger picture. because we were told that not withstanding everything that has happened, all the media revelations, including "new york times," not just "the guardian," our report, wide publication of the evidence such as the four

noble enough, we were just told that it was only in ladies over 2010, long in the presence, those epiphany moment where they saw it at the top realized that the one rogue reporter because it's not true and i drafted astonishing in its literal sense because i had a headshaking moment how could this come to happen. >> could i ask you, you're trying very hard to avoid getting into the party political waters, but surely must be able to guide us a little bit the summary says that some of these conclusions are partisan or politically motivated, and, how would you respond to the? you've said that you're going to ask the house to vote on the conclusions of the committee, mike the house not be a little confused as to what the overall conclusions of the committee our? >> in terms of how members voted, it is for them to say and they're all here present and can

do so. what i would say is that the motion that we are tabling in the house will concentrate on the issue parliament being misled of specific evidence presented to this committee. that was the main agreement for committee in its late inquiry. and a large part, indeed almost entirely on those specific issues this committee was unanimous. so, therefore, what other additional statements which prove more controversial which were included in the report, the main findings of the committee which relate to missing evidence given to thank committee, this committee will hold it a great and, therefore, will come to that debate i hope that that is the area where all those in the debate will concentrate. >> thank you very much. could i maybe ask one empty to

explain why they think rupert murdoch isn't fit to run a company? and another in peter slen why they think rupert murdoch is fit? and for those who are found guilty of misleading parliament, are you going to be taking them to the parliamentary cells? what's the punishment? >> can i have a vote here from either side? [inaudible] >> in terms of what the consequences are, to some extent not for the first time this committee is exploring uncharted water. we have gone as far as to say that we wish to have this matter drawn to the attention of the house. it is for the house to decide what consequences follows. but there will be others with more knowledge and experience than me, presumably advise him what potential consequences could be. now, david. >> i think let's be clear. we made the decision yesterday

on the report were given an amendment with a very set working, and as you all know, the description of what some is a fit and proper person is a matter when to find someone -- [inaudible] it's a very precise definition. i think we have to proper out. that makes sense when the committee is making a judgment based on a legal ruling. that was not something we investigated. you may have also the personal opinion about rupert murdoch and his county, the way he conducted affairs but that is not something the committee, we have taken evidence on and we were in a position we got to make a judgment on. it was a opinion given to the committee to vote on. we took evidence on and that's what we published and we agreed on in unanimity. >> and the alternative if you? >> the reason i support the

statement to run an international organization, i think we have to go back to the fundamentals in the sense that news international news corp. acted as if they were of a been beyond the law. and to suggest, some people suggest there's some sort of glass ceiling that didn't reach rupert murdoch, james murdoch as the ones to report, astonishing, suggests huge amounts of money was paid out to people without senior executives as incredible. so people, and i think the general public will draw the conclusion that astonishing, that people running a company and didn't know what was happening. rupert murdoch was -- so, therefore, he i believe should carry the can. in terms of james murdoch, and a

scottish court our scottish committee i think the guilt would not be proven. >> to me, quite clearly rupert murdoch is the person to run a major international corporation. he has run successful business, he's employed hundreds of thousands of people around the world. he's made a huge difference to the media industry. we have seen absolutely no evidence to suggest that rupert murdoch was aware of any of these things that were going on at news international, "news of the world." if i thought he had been aware of what was going on and he deliberately covered it up and may be committed any crime in doing so, then i would've been happy to say i don't think he is a fit person to run the company. we have seen absolutely no evidence to suggest that was the case. and yes, of course he's made mistakes. of course, james murdoch has

made mistakes. making mistakes, we all make mistakes. i make mistakes every day. and not hear of anyone who is not made mistakes. we all wish we'd done things different from time to time. hindsight can be a wonderful thing. but to take that to say that this person is not a fit person to run a major international company when you've been doing that for decades it seems to me to be not only a way to the top of also completely ludicrous. >> the bottom line is we had no evidence on this, and it seems to me that even in a report down the political lines as this one was being drawn, though member of the committee -- no member of the committee could find and hard heart is either james or rupert murdoch has misled the committee. nobody. even the report that was published. therefore, it did appear to us as something negative has to be found to say about rupert murdoch, and no one was going to conclude that either he or his son had misled our committee. and, therefore, this line about rupert murdoch not been a fit

person which echoes was stuck on the basis of no evidence presented to the committee whatsoever, and we just could not supported as i said, if there are many, many votes once again likely to view on james murdoch, i would definitely vote for the report had that language not been placed in it. >> david grossman, the beast bbc "newsnight." can i ask tom watson, why was it so important to get in that line about rupert murdoch being a fit person to run a major international company, with the expense has been, or the cost of getting that line in has been allowing opponents of this process to betray it as -- portrayed as political payback or whatever. >> there is a judgment you have to make with these reports,

about whether you go forward a week a report and getting unanimity, or whether you stand up for, for which he steadfastly believe. the majority of -- [inaudible] we needed to raise the bar. and for me that was because in the last report in 2009, the truth is we're negligent. we made a mistake. we invited rebekah brooks, the chief executive of the country to give evidence on three occasions. and on three occasions she rebuffed us. and we decide at the last minute not to compel her to give evidence, and that was because there was huge amounts of pressure by the committee. there was an election looming so there were time pressure. there were also political pressures, in my view, for us to do the. and i didn't want us to be accused at the time of ducking

our responsibility. i wanted the committee to be courageous and competent about the most powerful media moguls in this country. and it would have been wrong for those news journalists who lost those jobs, those people are actually facing justice for us not to comment on rupert murdoch just because of who he is. we have got honest disagreement here. you can see that, but i just felt that it was important that as a member, an individual member of the committee and collectively, spoke up. >> just to add to that, david. when the game was up in terms of the one rogue reporter, as you'll see from the tax year, possibly to rogue journalist, one of whom shouldn't be name because of the criminal proceedings, what we saw from news corporation, and it is really in the report was a clear strategy, we were being invited

to blame tom crone and colin myler. you will see from the corporate conclusions, and not just conclusions regarding rupert murder of, that we simply declined that invitation. >> according to my good friend and colleague last week we made the comment -- [inaudible] been asking the question what is the people at the top of news international not been identified, some sort of blame whatsoever? i have to say -- [inaudible] >> the committee's unanimous decision in a recorded vote summoned both james and rupert murdoch. so unlike perhaps, we weren't. we were united. we we just strongly disagree on

where the evidence conclusion came out of the. >> that's true. yes. >> i'm from the financial times. i'm not a lobby reporter. wasn't open to the conservative members of the committee to publish a dissenting report, a minority report? and if it was, could one of them please explain why they chose not to do it? >> simply on procedural issues. obviously any member of select committee could prepare in minority report, but it actually we have emphasized repeatedly a very large part of this report was unanimous, therefore it was probably more sensible that where there were divisions it was made clear, the were recorded in the back of the report. but the fact that large first part of the report was supported by everyone, with something which i think all my colleagues felt was the most important

outcome. >> hello, not all conservative members on the committee agreed with each of them on every aspect of the report. so it wasn't that we have sort of a block conservative view on these matters. so there was, it would seem to be feasible to have a minority vote because of months before of us, if you look at the division we vote in different ways on different amendments. [inaudible] >> we voted against the report. >> but if that sense wasn't in the report we would i have voted in favor. >> ben webster from the times. i just ask adrian saunders, impressed the chairman as will come if you go to the other way, then as the only lib dem member

who voted from the committee, then it would've been split which would have meant, correct me if i'm wrong here, john's vote would've come into play and the report would have been rejected. and if that is the case, just ask mr. saunders, you have a lot of responsibility there for your vote, and why did you decide to do with the labour members? and did you consult other people in your party? >> we all collective responsibility as a committee to seek the truth. and from the evidence that was presented from my experience of the previous committee that looked at hacking, and in particular the evidence that was presented on this one, i took a decision on that. and any one member at the end of the day could be that person holding the balance of power, depending on how other members made their mind up. [inaudible] along party lines. it certainly wasn't other

divisions and other parts. house in the chair would have exercised his casting vote, i have absolutely no idea at all. and i think it would be probably wrong for the chairman to give an opinion, because he can only cast that vote in the circumstances in which it aris arises. >> indeed. what i would say is that -- [laughter] it is a matter of some regret to me that the committee was not able to produce a unanimous report, particularly went large number of the committee was able to reach agreement. i'm sorry that in a sense the strength of unanimous conclusions has been diluted by the fact that the press conference and attention outside of it will focus on areas where the committee wasn't able to agree. yes? >> gene with "the wall street journal." and you just clarify which

aspects of the report were unanimously supported? and also which individuals could be accused of contempt? >> i think if you look at the voting in the back, it becomes apparent. but in terms of the main conclusions, those relating to the individual's names, specifically, tom crone, colin myler, those conclusions were agreed unanimously. >> thank you. andy bell, five news. on this one what you think the public is supposed to make of this? because we've had months with a been seen to support in the leveson inquiry and all the rest of the. this was an opportunity to give a lead in to say what you think it we've ended up with a committee report which is split down party lines. i know -- [inaudible] but you have come away and yet with a report which does lack credibility. that must be a matter of great disappointment to the. i'm resuming to all members of the committee spent in actual

fact as i said earlier, the main part of this committee in his most recent inquiry was to the question of whether not we would be blamed for the evidence we were given but it was on that subject we attempted to table a motion to parliament. there is no division within the committee. so to that extent this is a unanimous report to parliament that the committee was misled by named individuals. >> you probably notice from individual members of this committee that they are all unique in their strong views and wheels. and i happen to think that that is a good thing but it does mean that sometimes you get split reports. i have no doubt that you will be able to interpret that report and put both used to the public so that they can form their own future it's my view they have already formed the view on rupert murdoch's company, and this is yet, this further shows how power corrupts the institution to the united

kingdom. >> just, i mean, clearly what is perceived out there s. also depends on how you report this press conference. but i just take you back to the question from gary wright at the outset. if you look at 163, the bigger picture of what everyone knew, and you look at the division back, the committee, and there could be application in that paragraph, the committee was pretty much unanimous because it was 9-1 in favor. this paragraph is asking about astonishment. >> do you conservative members now face a difficult choice in the chamber as to how to vote, and whether that vote will be perceived of voting the

murdoch's? and also in terms of the report, where is the whole affair demonstrates huge failing of corporate governance and company and its parent's news corporation, is that the view of the whole committee? what would you recommend news corporation shareholders to do? >> well, the question has already been answered, because the motion a comes before the house will be about parliament being misled and we'll all be able to support that motion. so that question doesn't arise. as to the failures of -- this is a great example. i voted against it. we didn't vote as a block. there clearly was failures of corporate governance at news corporation, there's no doubt about that. the committee has taken to task. that's right improper. but it's not really for members of the select committee to be inviting news corporation shareholders and what they do and don't do. that's just wildly outside our committee, and that's what comes

back back to the fact that the fit and proper lighting will concentrate on is what prevents us from being able to agree a report to the house. and yes, of course it is a huge shame. >> the chairman said earlier the purpose of the motion would be to decide whether people are guilty of contempt of parliament. we are all agreed, and that is the substance of the poor, it's what we are investigating, the first time it's been done since the 1950s. it is -- all the opportunities of interest. >> i will point out that mr. colin myler is the editor of the "new york daily news," and we have just found that he has misled a select committee of parliament. i would hope a little bit of attention would be paid to the unanimous finding of the committee when named individuals misled parliament. and furthermore with a very good

question posed by lucy manning, which if somebody comes in front of parliament analyze to it, what happens next? the fact is we don't necessary have the procedures in place and we will therefore be referring it to parliament to find out what to do. but his conclusions have been drawn about people misleading parliament on which we were united. there is a lot in the support of which they could be completely agreed. and you know that's the shame that we weren't able to agree on the report itself but the line about rupert murdoch. >> thank you. james cusick from the independent. is any news corp advisor attempted contact or influence the outcome of this report? and i know that some members of the committee have been contacted, i think by fred michel, but anyone else? >> welcome in terms terms of the evidence, which i think rupert murdoch presented to lisbon and four, lisbon contacts which it is called, and this committee, i

mean, they named a number of members which are those currently on the committee and, indeed, members of the previous committee. i certainly have spoken to fred michel. i always adopted a policy of an open door, not just in this inquiry but all inquiries, but if people wish to come to talk to me about, to get the point of you i will listen to the. but the question about whether or not they attempted to influence to the extent that they were putting their capes, but they didn't do anything which was improper, i heard people came to see me who have just a strong view in the other direction. >> i just completely, i was exact with the chairman said, i can put my hand on my heart and say nobody has ever tried to influence what i said in a corporate if anybody knows anything about me they would know it would be -- try to

influence what i think the i think i'm sufficiently independently minded, to be completely, you know, i won't be affected by endless attempts. certain i can put my hand on my heart and say i actually -- that actually did not happen. >> that would be counterproductive to try to influence philip in terms of changing any of his opinions in any report. and likewise myself, i don't know fred michel. they have not contacted me during this inquiry and i cannot despite my name being there in leveson, remember anyone contacting are trying to influence me on a previous inquiry because that would be ridiculous and stupid i would think. [inaudible] [laughter] from news international. >> i don't think i have been

lobbied. >> yes, front row. >> this all looks like a bit of a shambles, mr. chairman. you've ended up with a report that half the committee voted against. do you consider that you failed? >> no, because i think as i said, most of my colleagues have spoken have said, that the main findings of the committee if the area which we were asked to examine which whether parliament had been misled, the committee voted unanimously and i hope, therefore, that will be what people concentrate on. that may be a big no, but i would like to think that people will concentrate on that, and certainly that would be the message that we will be relaying to the house of commons for motion. >> it was put to our discussion that if you leave this light out that we will bear the support, and he decide not to pay

something for. it is all right for people to different political views to disagree indefensible fashion on things that are close to the heart and about which they get very much. the news -- he was completed within his rights to do so. it is not a bad thing and not a shambles when people have genuine disagreement in principle, disagree take a vote and put those agreements on the record he had every right to do so. >> you need focus on negativity and report, but i think the most important issue that is racier today is that this committee has expose criminal activity to establish press and media. that has led the leveson inquiry -- [inaudible] so i know it's always a comfort zone to be in a negative zone, we are hopefully shone the light

on what was criminal activity and also what was not. >> the report says that rupert murdoch's self portrayal as an opera proctor was, you consider, a misleading account of his involvement and influence of the newspapers. are you accusing him of misleading us? >> that was, that was, that is my amendment and you've got the text there. what we've found, what we found on times when it is soon to come is they forgot, didn't remember, or as tom said, this is such a small part of my empire, our empire, that we didn't pay it too much attention. and their weird testimony which is recounted from rebekah brooks, that when chief executive should speak to rupert

murdoch every other day. you can draw your own conclusions from that. this is a fruitlessly, of course. this shouldn't be a focus simply on robert byrd ah -- rupert murdoch because there's a focus of the news international. if there was one phrase from the last report that resounded around the world including australia i think, the faceless collective amnesia. if there's one phrase apart from rupert murdoch which should possibly tackle in the same weight in the support, it's one that is used in amendments by me, from the and from tom watson, but the question that our colleague adrian saunders first asked in a session, and that was about willful blindness. and that phrase, willful blindness, in respect to the whole corporate conclusions be the failure to follow up very

public wrongdoing, not just on n the phone talking, and discipline the perpetrators, i think that phrase should receive focus as well. >> hi. rupert murdoch to give evidence to the committee. some slightly sort of, i don't quite understand why concerted members of discussion about rupert murdoch was some of ultraviolet to the committee but perhaps they could explain the. and furthermore why did not propose any alternative amendment if he disliked the characterization of rupert murdoch? and in particular why don't they support amendment vis-à-vis the fit person statements? >> first of all, in terms of, well, why do we not put an alternative, that was an amendment before. we were voting to restate the status quo of the report.

so you don't put forward an amendment to an amendment that has not yet been voted on. that's just, yeah, i don't we understand your point really. >> go on. >> that's fine. >> we have to decide whether rupert murdoch misled us and what he said department of an no one proposed at any point that he misled parliament. now, there is in the corporate, a next step actually, the corporate line, that was an amendment i supported in the votes. and there we were critical of the cup as a whole putting too much emphasis on the river of internal investigation and the action been taken by the cover. that is a criticism of james murdoch as was other executives named in the portraits i think we have been critical both of his role in some of the things he said. but what no one has proposed is that he misled parliament. >> nobody said that rupert

murdoch wasn't a just about party to the report your i don't think anybody said that. i think what you said was we didn't agree on conclusion in a report about rupert murdoch. [inaudible] >> if you look at the decisions and the vacuous he would've greeted the status quo of the report without that particular amendment. [inaudible] >> we don't believe he misled -- we were looking at, the whole purpose of our inquiry was a people mislead the committee in our report back in 2009? we don't believe, i sent sealy -- i'm not sure that anyone about rupert murdoch misled the committee. we haven't seen any evidence that james murdoch misled the committee. we concluded that the three individuals that we've already mentioned did mislead the committee. that's why we didn't agree with the conclusion about rupert

murder. [inaudible] there was no evidence there to suggest that. >> you've already. it does say, this was not done by one party voting. at the end of the conclusions and accept,. [inaudible] so that his comment in the conclusions and that would've stood even without the additional line that he was soaking we have. we had to divide on the whole report. >> were there any objections from committee to one of their members putting out their own version of the book before the report was finalized? what charged you take mr. chote to make sure that no privileged information given to the gain was used in dial m. for murdoch, especially given the finest of report on page 312?

>> well, what i would say is that almost all the evidence that was presented to this committee was published on the internet almost the same day, or very shortly afterwards. the terms of privileged information which is not available actually does very little which we didn't make public. the ones we did make public is where we're specifically asked not to do so. i was not aware that tom watson in his book -- which was not made public but perhaps he would like to address that. >> thank you. good to see you again. [laughter] firstly, your service held a broad so i'm told i can't see you for libel. secondly, all the information in the book comes from either public sources, and were i thought the committee may what's the evidence i submitted it, some of which was used, most of which was accused.

because of the justice issue. but i'd like to put a question to you. can you tell me why paul staines held the need to destroy his hard drive after he broke the story? i'm not sure this is an opportunity for the committee to ask questions of the press to it's not normal contacts. i would ask you to pursue that after. >> josh holliday from "the guardian." you are each newsgroup in the report to waive legal privilege. why do you think that would be significant and would you consider revisiting your conclusion if it is significant? >> well, we, i think it was a chance for the committee to persuade news corporation to withdraw privilege to the loose report.

but possibly we also got -- after the evidence of rupert murdoch gave to levinson last week when he was specifically asked about this by justice leveson. and he seemed to attack burton & copeland in a statement way kind of lengthy executives for the cover-up. and there was this mumbled comment to do in the corporate and i think be really important that we just clear things up to it that report in 2006 i like is that there was wrongdoing, other than phone hacking, then it shows that there is a conscious -- consciousness of the company at the time and executives should have acted. i think it was too late for us to take a view on that. but you asked, i believe it was a unanimous view of the committee that that report should have privileged and should be submitted to levinson. [inaudible] >> documents that we receive any investigation came as a result of privilege being way.

clive goodman opinion, the notes from mr. pike's conversation with colin myler all came as result of privilege being way. so i think it's -- [inaudible] >> one of the difficult and committing conclusions in this report is been that many people know far more than we give it that includes lawyers, claimants and civil claims. because even though those have been settled, there were disclosures affected by court confidentiality. in the gordon taylor case, a limited waiver of legal privilege was given. some people might speculate that might have the effect of just dumping tom crone and colin myler. but we also asked for a waiver of privilege to be given in the max clifford case. we just wanted everybody to come clean and tell us exactly what they knew. and they refused to do that. i just want, there are other

parts of this report apart from rupert murdoch. there's a section on the police. the police and cps failed over a long period of time, not just mr. yates and others. but one of the things we don't cover in a poor, the report covers a lot of ground, i made this comment is more interesting legal magazines come that there was a succession of lawyers, burton & copeland, indeed michael silver lease qc who continue to represent the corporation and civil claims, who we know knew that what news international was telling us about one rogue reporter for defense was untrue. now, it's come out in our conversations and discussions with the speakers council of parliament is not what is referred to not strictly accord for legal quotes. but we've not seen seen anyone of those lawyers resigning on principle. when they knew that what we've

been told and the general public was being told was not the truth. >> to say, that there was much disagreement in the committee about this idea. i don't believe lawyers have to represent their clients best interests within the lockout and that is all they have to do, i don't see any occasion for lawyer to resign for having done his job as he is obliged to do under the law. on the matter of burton & copeland, i do, i'm glad you brought this up. i do think it's an important one. this is an amendment which i was very pleased to support, it's absolute a quite right and i would like to take this opportunity to call on news corporations management and standards committee to release burton & copeland from privilege at once so that we can have transparency and be quite sure that there is nothing further being concealed. that is the opposition. he was right to make the minute and received unanimous support from everybody on the committee.

>> to questions for mr. woodson. neither words fit and proper are in the corporate what do you think happens with you on ofcom to look at the evidence presented to the committee? and also you call for this parliament to have been in corporate to continue to happen urgently? >> okay. just -- just to be precise we use the words not fit person but we don't use the and proper to say get that right. and on the scottish parliament part. look, we saw jack yesterday. he was a target of hacking. and we know that thomas sheraton, now knows he was a target of hacking when he was a member of the scottish parliament. when we found out similar things had gone on in the westminster

partner, we ordered a new inquiry. sabah told party leaders of scotland can come together and organize their own inquiry to find out what was scope of the intrusion and the privacy was, and where the focus was. >> chairman. i wonder if you could guide us on a bit of a process in terms of the motion that is going to go before the house. you say in the report, the press release which is the own misleading committee. can you only put motion before the house to the committee unanimously agrees, or whether come down to the vote as well that they may split along same lines has done so for? and secondly, what is the cash to i know you know parliamentary guidance on what the penalty for being contempt upon my become but what with the committee must have some sort of you on what you would like to see perhaps an apology? >> welcome in terms of the motion, my hope is that segment

will be agreed upon. the reason the motion will focus on specifically misleading the committee is because that is the matter for the house of commons. on other matters like committees report, the governments respond within a period, and the committee can sometimes request a debate. that would be the normal proceeding for us like many a report. but in this instance, we are reporting what we believe have been a contempt, which is a very different matter. and, therefore, a debatable motion in the house seemed an appropriate way forward and it will focus specifically on whether or not attempt a good. now, your question if the house agreed to have been content, what happens next, i believe there is precedence, although quite a long time ago, for a defendant to be called before the house, to be abolished and have the houses conclusion made clear to them. but to be quite honest i don't

know. i suspect that would be a matter of debate, perhaps by standards and privileges in house by leader of the house and others. at this stage we are intending to table the motion, and no doubt that parking will be involved in consequent discussions about what would happen if it is then in the house of commons. [inaudible] spent contempt of parliament. and certainly that is not the case at the moment, but i think we need to find consequence for misleading parliament. >> we could spend hours on that particular debate, but perhaps we shouldn't. >> gene with "the wall street journal" but isn't possible then your motion will accuse rupert or james murdoch of content, our only in milder, and crohn's

because it is not conclude that either rupert murdoch or james murdoch are potentially guilty of content. is made another -- other conclusions but about the specific question about misleading evidence, this committee is therefore department, we named three. >> clearly we are sad after five years not finished yet. we have not been able to go further because of the police investigation. there are other things that made emerge, which may want a re-examination of the evidence. and i just stress here the human cost. lin mulcaire was not operating in isolation. he does we have not yet had the most bound database. we have not been able to make the links between what the detective was doing, and compare the evidence we're given.

other private detectives were doing the things at the same time including mounting surveillance over at least one member of the committee. it's been admitted in the civil case that computer hacking went on. with all the pieces of this which are yet to be put together. at the end of the day the human cost of this, the intrusion into the ordinaries dash the arctic peoples lives have to be at the forefront of our thoughts and i hope your thoughts. this was an organization with its newspapers that give moral lectures to public that acted as we now know them morally and criminally if so. held itself above the law. >> thank you. we have no more questions. thank you very much.

>> [inaudible conversations] >> and as this news conference wraps up, "the associated press" story in the spring this work offers these headlines. uk lawmakers a rupert murdoch unfit to lead major global company, and uk lawmakers a rupert murdoch's executives misled parliament over phone hacking. and deliberately ignored evidence of malpractice, covered up evidence and efforts to expose wrongdoing. if you missed any of our

coverage of the levinson inquiry into british phone hacking, those hearings are available on our website at c-span.org. go to the c-span video library. spent our live coverage on c-span2 will continue at 8:30 a.m. issue. limper goes a a look at the economy. panels through the day will focus on government spending, the housing market, federal banks, the impact of free markets, tax rates, the dollar and a number of other topics. coverage starting at 8:30 a.m. eastern. you can also see online at c-span.org. >> our companion network c-span will be live at 10 eastern a set of national drug control policy will discuss the obama administration's approach to drug control which was released on april 17.

>> i have seen to earn a certain place where people listen to me, and i've always cared about the country. and the greatest generation writing that book, gave me a kind of a platform that was completely unanticipated. so i thought i'm not to squander that. so i thought to step up as, not just as a citizen and as a journalist but as a father and a husband and a grandfather, and if i see these things to write about them and tried to start this dialogue, which is what offended you with this book about what we need to get to next. >> in his latest, "the time of our lives," tom brokaw urges americans to redefine the american dream to end sunday

live in depth here question for the former anchor and managing editor of "nbc nightly news." in his half-dozen books is written by the greatest generation, the 1960s, and today. in depth sunday at noon eastern on c-span2's booktv. >> are former presidents who are all nobel peace prize winners sat down for a conversation about the challenges to world peace and prosperity. the discussion was part of the 12th annual world summit of noble peace laureate held last month in chicago. this is the first time this annual event has been held in north america. msnbc's chris chancing moderate the panel which included former presidents jimmy carter, mikhail gorbachev, fw de klerk and lech walesa. this panel is just over an hour. >> good afternoon.n. [laughter] >> hello. >> hello. >> great to be here, and,o be obviously, a great honor for alr

of us to be able to see for president, for nobel peace prize winners, f for men who are important in history. [applause] >> and while we're getting the f our programm together, i knows you are rehear d introductions to these four great men, so i will be very brief. mymy immediate right, president jimmy carter was the 39th president of j the united state. [applause] he was awarded the nobel peace prize in 2000 to four decades of his untiring efforts to find peaceful solutions to international conflict. president miguel borja of of the soviet union, his policies of

glass nose led to the downfall of communism and the breakup of the soviet union in 1991. he was awarded the nobel peace prize in 1990 for helping to end the cold war. "time" magazine named him man of the year and man of the decade. mikhail gorbachev. [applause] f. w. de klerk is the former president of south africa, a one of the peace prize in 1993 along with nelson mandela with efforts to end apartheid and initiate the first fully democratic constitution for south africa. president de klerk. [applause] and lech walesa was the

president of poland, helping to lead the poles out of communism. there are the other members, including the pope and mikhail gorbachev. [applause] is that a high five? we are together with men who have changed the course of history, but they are here with a message for all the young people an audience and who are watching, not just across america but in many places around the world, and that is you, too, have the tools to

bring about change. it is very simple. there are many examples. but perhaps the most global what happened in 2010 when a series of protest by young people started that spread to egypt and libya and syria and yemen and became known as the arab spring. they are still riding the future of the arab world as a result of what the young people did there, and in the united states, the u.s. have led the occupy wall street movement, to bring about change in the conversation in a way that the news media is covering this very controversial election here in the united states, a change in the conversation in washington, and so we want to talk to them about things about changing the world and also advise for you about how to change the world.

president carter, let me start with you. what do you think the biggest challenge is in the world today? >> i think the biggest challenge is the international community to go to war only as a last resort. it should also apply to the united nations and all of the regionals. i think now humankind in general are much more inclined to resort to armed conflict instead of negotiations and mediation and a commitment to peace, because all of the major religions say that peace should come fourth -- first, watching the prince of peace, not war. if we all did that, we would not have any more wars, and i am not saying that islam and judaism and others, humankind has got to

say that war comes last, peace comes first. [cheers and applause] >> are there places in the world, president gorbachev, that give you pause right now? >> well, i feel that people are disturbed. and i think that once again, people are asking the question we asked 25 years ago. will there be a nuclear war? something happening in the world. i have heard that again. i heard that years ago, and now i am hearing it again. and i fully agree with jimmy

that we should not be worried. i remember in the politburo, they said it would take a couple of tanks. thousands of tanks cannot solve problems. the most important thing is people want change. and people see that often change is not happening. there are opportunities that have not been used, and again, it is a lack of political will, and more than ever before, without democratization of politics, without political

leaders listening, without them listening to civil society, i think we will never succeed. the democratically minded people everywhere in the world should unite in should understand. the production, industry, agriculture. that is important, but there is a more important thing. the people everywhere in all countries. unless we do that, unless we have governments practically everywhere in the world take kind of a condescending attitude towards the people, we will

never put an end to the kind of problems that we are facing. and very often, the old tricks are being used in this new world. we must unite. we must have solidarity. we must support each other. to change the world for the better. and i think the awards and the nobel peace prize, awarded it for some contribution, for making some difference, so you, too, must act. civil society must be more active than before.

>> the role of the people. and the role of government with some examples. last year, for example, president obama cited a directive to the civilians in libya deciding to allow military power there, and i think many have seen the video. millions have now seen this video of the fanatical head of the resistance army, notorious for murdering civilians and kidnapping children. in october, the president dispatched about 100 troops to you gone back to hunt down joseph kony. and there are human rights activists. in syria, to stop the killing there. where is the role of government

in modern society? can you make any sort of broad statements about that? has it changed? >> i think governments and the opposite, bad government, lie at the root of improving the quality of life of people. for that reason, i have formed an organization called the global leadership organization. prime ministers, presidents, cabinet ministers, and we are all prepared, and we give our advice not-for-profit, and we give our advice sort of beneath the radar. what initiatives to take in order to end conflicts, in order to settle conflicts, in order to

govern better, in order to get the economy going, in order to create a better economic climate for foreign investment and the like, so this is extremely important. i do not think the united states as the only superpower right now should accept the role of policing the entire world. [applause] in all countries, there are governments. a president said there is a time for a big stick and a time for speaking softly. too much big stick. is it not time for speaking softly? of the south african experience,

i can testify that we did not change because of oppression, because of the many big sticks wielded. at times, that delayed reform, and president carter was right when he questioned the effectiveness of sanctions and the like, and is not such an effective instrument to bring about change. peace can only be achieved if you get people involved in that which stands in the way of peace to go to each other. i do not know of any peace effort, a country torn apart by violence, but conflict, which has been achieved without former enemies sitting down, negotiating, and reaching an

agreement which becomes part of an accord, so i am a great believer that the world now needs in addition to an act of civil society needs a sort of private diplomacy to bring about the change of hearts and minds. if we analyze the root causes of those things which suppress people, which causes so much misery, i would identify some, but there are others. for one thing, we are failing to manage diversity. all countries are becoming more diverse. an overwhelming majority of all the countries in the world have important minorities consisting

of 10% or more of their population. are we managing diversity? how do we make important minorities feel -- and appreciated building block of the greater whole? instead of them feeling and actually being marginalized in the country where they have been born, where their children are being born, and where their grandchildren will be born. and the second root cause of all of the misery and all of the oppression lies in the fact that 2.5 billion of the 7 billion people on this earth live as an absolute misery. are hungry. live beneath. so if we look at the bigger picture, i think we need to

develop a vision, and world leaders should put their hands and their heads together to develop a vision of how we effectively manage diversity. secondly, how do we win the war against poverty? people living beneath the bread line, giving them a better life, giving them hope, giving them opportunity. [applause] you areident's waalesa, someone -- president walesa, you are someone fought to give people a living wage, to have them work their way out of poverty, and i certainly do not want to draw a direct

comparison. when you look at the youth unemployment numbers in the united states and the difficulty even with a college degree now of getting employment, there is some understanding of what it means to fight to be able to support yourself. here is a classic picture. you have may be seen it in your history classes. some of you are old enough to have seen it while we were alive. the class emission of you standing up with workers at the shipyard and bringing about the solidarity movement, which changed, again, the course of communism and certainly changed the course of history. tell me what you think the world today is a protests in society -- tell me what you think the world is -- role is to day of protests in society.

>> young people tell the truth. so therefore let us be truthful and implement the truth here, so here i am asking, the chinese nobel peace prize winner, asking yourself in your conscience and ask yourself how we should be a if when our laureate is in prison. but returning directly to your question, until the end of the 20th century, places were

divided, continent divided, and there was a great disproportion in the development and standard of living. in the united states, perhaps you cannot see it that clearly, but in europe, we can see it. now, we have advanced to the technology so much that it is no longer single states and countries. we have come to realize that we have to enlarge the structure in which we organize ourselves, and during the lifetime of this generation, we need to quickly and large our organizations, or otherwise it will continue increasing in the future. for me as a revolutionary, i believe there are three major questions that we need to answer, and the answers to these

questions will determine which way we will lead our countries. the question is what should be the economic system in europe as a single state? not the capitalism we have in place today. we improve it. unless we reform it, it will not survive this century. certainly, we will retain the free market economy. there is no question about that. but certainly not the kind of injustice that we have. on the internet, we can get together over a few hours, and

humorous are no longer scared of their neighbors. the world seeks justice. just checking the weather cheat on them. and the development by improving economic systems to prevent the waist and damage. this is a question we have no answer to. the second is democracy. today, people do not consider this seriously. they emit some representatives, and the following day, they try to write it and get rid of them by rioting on the streets. democracy. we need responsibility on various levels, where technology

should safeguard leaders, making sure they implement the platform, and a question that would really be the fundamental one, what should be the foundation that would allow stable european integrity and stable globalization? ourselves with different freedoms, and this is half of mankind's thinking. the future of civilization. the remaining half claims that nothing stable can be established. this will really miss the media.

the stands the best of a chance for prosperity. it has to be safeguarded. but when we speak of values, there are so many different ones. and what is worse, we do not have an entity or in individual that we can all share and values to serve as a foundation for any solution. if we manage to find that foundation, then, the contraction that we are anticipating. the challenges and opportunities for us all. [applause] >> i would like to make one positive piece on what president

walesa just said, which is the prospect for prosperity, the prospects for the future of the young people out there, and i was looking at some old, if you do not mind me saying, television footage. 1978, the treaty, is that right? and at the signing ceremony, but what struck me was your daughter amy. she would have been 12 years old, and she has a grandson about that age. two grandchildren. do you think these opportunities for peace and prosperity and maybe nuclear peace as we were talking about, but to president walesa's point, are the prospects for peace and prosperity as good or better for your grandchildren as for amy,

and how about moving that forward? >> i think the prospects of peace for my grandchildren are better than they were earlier, and amy has two sons right now. one is 12 years old, and one is just 18 months old. the 12-year-old goes to school. he has no other text books, and he is able to communicate with children, for instance, in china. in china, i went to give one lecture, but he communicated with the school children in china about the common things we have to address for the future. i think by the time we go through another four or five years, maybe when the war in afghanistan is over and iran, and the world sees that peace is possible, then i think there might be a turning of attention for more opportunities for children of all nations to

communicate with each other and to learn about one another. >> and does not technology make it easier? we certainly saw the way the pictures were, for example, in tahrir square, in egypt, when we were able to be interconnected and were able to organize because of twitter, because of facebook, because of the internet. how has technology changed the prospects for peace and for the involvement of everyday citizens to make a better world >> well, the carter center is deeply involved in egypt. i will be going down in a few more days, and i do not think any one of those revolutionary -- would have been possible without the modern technology. the cell phone and that sort of thing. people in communities within libya and within tunisia and within egypt and so forth to

gather together with a common purpose, and the point i made earlier about my grandchildren, not only are the children in china and japanmaybe north koree israelis and the egyptians -- those children are going to be able to talk to each other and communicate with one another, so i think what has happened in egypt or tunisia is likely to happen in the future among children of different nations, and they have something in common, the benefit of peace and prosperity and environmental and equality, i think that will be a major contribution to them wanting to get along better with each other instead of to go to

war of the drop of a hat, so i think it is going to been in peace and not war because we understand each other better pure growth harks -- we understand each other better. >> you and i were talking about presidential candidates who were not going to be allowed to participate. i know all of you have talked about your frustrations in not seeing the war come out of and what you have accomplished. is it harder to create peace or to sustain it? >> they are different

challenges. it requires them to fully accept the need for fundamentals. it is the starting point, and this is what needs to happen. we cannot just maintain the status quo. we need to change in order to improve the environment in order to bring a better life to our key bove and -- in order to bring a better life.

it demands adhering to the cornerstones of the agreements of the constitution, which was negotiated. this was effective protection of private ownership, freedom of the press and freedom of association. all of those are under threat, because it is argued what was good 20 years ago maybe is no longer good tuesday -- today because of bad government. education has not improved. what was needed was a effective

governance, good management, and when that falls away, it can significantly damage what has been achieved. >> those their need to be a face to that change? it occurs to me there were faces to the camp david accords, iconic images and we have had. we know mikhail gorbachev was the face of change and nelson mandela is so connected with the end of apartheid. one of the criticisms of the occupied movement is they will never affect the kind of change they could not, and the coasts -- because they reject being part of the structure, so by not

having a face to represent that change, it is difficult for them to do it, and i am sure there are a lot of students in this audience who went to the occupier movements or were interested in them. do you think without a strong leader it can affect change? >> ladies and gentlemen, whenever we looked up the problem, and we have to the get- respective term. it is a different problem when you have an outsider. good let's look at it differently. each of you can drive almost

anywhere all around the world. now won the advancement as also does, it -- assaultive us, we have to a depth of things we can have that are the same kind, whereas with the different taxation system, a different social benefit systems. the disproportions' are simply too big. but is why when we have this vote, are we talking about respective states problems? we are facing the challenge of greece. they have much better social

benefits and poland, and poland is supposed to be helping increasgreece. a similar thing will occur when we come to terms with governments. we should really begin to think what should be the foundations and only then decide what we can afford three today, bearing in mind all of this is necessary when one country dominates the other. then we assisted those who were the fastest runners. and we should assist those who live behind. isever does not pay tax thoses

not to our advantage. everyone is essential. as we must find jobs for everyone. if we felt there will be revolution. the discrepancies are so great, we have of wide platform for integration. we need to level disproportions in order to enlarge freedom for all of us. these are the challenges of today, but before we were not even allowed to ask such questions. today we have realized it is no longer anyone's benefit.

we can create better benefits, but the discrepancies do not allow us to implement the decision, and we have political leaders. we cannot invent a new vision. hopefully we will find some structures that can lead us forward. good sex does there have to be a singular leader? the answer is an -- >> does there have to be a singular leader? the answer is who is the singular leader in egypt or yemen or syria. the answer is there is none, but you do not need a leader to take charge and say, let's all do this endeavor -- and to gather followers. every student or everyone who believes in freedom or peace or

environmentally qualities beaks independently, but their voices combine and make a powerful weapon that can change a government and bring revolution. in the past you have to have a singular leader. now you do not. i think that is a good signal to say, i can do something. i do not need to wait for someone to tell me what to do. good >> i would like to pick up on that, because i think there is a sense the internet and social media has had an opportunity to bring us together, and president carter, you are known as a peanut farmer. you went on to become a nuclear physicist as well as president of the united states and a nobel peace prize winner. he is one example.

if you were in a school in chicago earlier today, president gorbachev was talking about where he grew up, and it was one of the most impoverished areas, and raised by peasants. can use the globex -- can you speak to youth about the opportunities that were out there, and to say, i came from plains, ga., or from a small town in poland. what can one person june? -- do? >> i think certainly we should

not speak about region we should speak about things we have achieved, and they are important. they must be continued, freedom of speech, freedom of protest. if there is a protest, it may go too far, of but we should definitely preserve the ability of the people, the right of people to peacefully protest, and that is a great responsibility on all of us on the current generation. what i would like to say is but i think the government in many countries understands the importance of youth in every country. we have recently had an election campaign, and there are some youth organization sponsored by

the government. one is called our people. what about the government? what about the rest of the young people? they are not ours? many people do not want that kind of divisiveness, that kind of split of young people into those who are good and those who are not. i think there is a great responsibility of the municipal level and also of the national level to have the right kind of attitude towards young people, confidence and respect. i am sure young people should not the pactiv on the back,

should not be controlled. good at is not a way -- that is not the way to work thwith yout. we will not succeed if young people are just supposed to do someone sitting -- someone's bidding. i think very often that results in irresponsibility, and distortion of the democratic process. that results in the way real problems are ignored, and that may result in extremist and fascist organizations and radical nationalist organizations.

we have recently discussed this problem of young people, and the leaders of some news organizations -- youth organizations have recently taken the path of some kind of extremism. i think it is only within the democratic city that young people can look forward, debate, shows solidarity. without the democratic framework, we could get something quite dangerous and very harmful to reuter >> you bring up a good point about two sides of the corn. good one is what we saw with the

arab spring, but there is also up a clear link between poverty and youth and terrorism. no longer the greatest threat being the soviet union, but the greatest threat in the early 20th-century was considered to be al qaeda, and i am wondering with the splintering of outside the, the you think terrorism is -- of al qaeda, d do think terrorism is less of a threat, particularly in the way discontent and poverty conceived extremism? >> i think it is a real threat, and i think we should start the change in approach and ask why

do young people learn in the hands of people like the late osama bin laden, who quiz their minds, who motivate them towards terrorism? why are they vulnerable to that sort of thing? i think it relates to issues like bad education, failed education systems, issues like unemployment, and no hope for a better life, because of bad economic situations. they have nothing to lose. there is an element of truth. therefore, improving the living conditions of people here give

where do the terrorists come from? they come from suppressed countries where people are surprised. and they come from countries where the masses do not have a good living conditions, and it is stimulated by a fanaticism, so i think terrorism remains of threat. i think if we want the youth to be activated in a more constructive way, and we need to also remember to heads are better than one. i am sitting next to to people who made a tremendous difference, but they had

organizational structures, and they were right to say, choose your cross, and a line with an organization. people believing in the same thing can do better if they develop new and action plan rather than each of them developing narrowness action plan and promoting it on their own -- developing their own action plan and promoting it on their own. and this becomes part of modern technology, which can exercise tremendous influence. i do not think we should glorify process for the sake of process. [applause] >> i could see you wanted to get in on this conversation.

>> we should start with a proper diagnosis and a treatment. there was a legacy handed down to us. we used to have >> we'll leave this program at this point, go to c-span.org. going live now to the newseum for a bloomberg news conference on the economy. at today's all-day conference, we'll hear from former white house budget director alice rivlin, housing and urban development secretary shaun donovan and others. this is live on c-span2, it's just getting underway. >> we are laser focused on the one big issue in this presidential election year, and that is the economy. we are looking at it from every single, possible angle. we are looking at it from the perspective of job creation, regulation, taxes, spending, the deaf -- deficit, of course, a

whole host of other angles. we have pulitzer prize-winning authors, we have top economic policymakers within the obama administration, people making decisions about the economy right now, the deputy treasury secretary's with us, the chief economist for the president is here, the secretary of housing will be with us as well. we have members of congress, both sides of the aisle, interrupting their congressional recess to share their thoughts with you, a special shout out to them for taking time to be with us today. both sides of the aisle represented. we have some regulators here as well talking about the regulatory environment and, of course, we have, as i mentioned, some very top economists. we have the former chairman of the federal reserve alan greenspan will be here, a sitting member, jeffrey lacquer, the richmond fed president, will be here to share his thoughts about where it goes from here. we have people from the business community, people who know the challenges with regard to job creation, why it's taking longer than a lot of people thought,

and we have as well a whole host of folks from the investment community, financial services committee some of whom are represented here in the audience. those folks trying to negotiate the turbulent waters of the u.s. economy, the global economy over the next few years. and as we try and determine exactly what's happening with the u.s. economy. so an action-packed program, some great speakers. it's my job to be air traffic control, to make sure everything runs on time. i'm going to try and make up some time, so i'm going to be trying to, again, martial everything according to schedule, make sure the trains run on time. you'll see from our schedule that there are no scheduled breaks, that is by design. we need to keep the action moving up here, keep the things on schedule, but we do encourage you at your leisure to take a break, head o out to the bloomberg kitchen, do some networking, get something to drink, get something to eat, but come right back because you might be missing some important action.

we will have a break, i should point out, for lunchtime today, so bear that in mind as you plan your day. that'll be about 12:15 to 1:25. we have as well the opportunity for questions from the audience and all of those watching on television, listening on the radio. let me walk you through exactly how that's going to work. you have to send an e-mail that we'll collect up here, and the e-mail address is q&a q&a@bloomberg.net, and we're going to try to include as many questions from the audience and people watching on their bloomberg terminals right now, and we'll include those at the end of the panel discussions. hope to get to as many as possible. we ask that you include your name and your affiliation so we have an idea of, again, your perspective on the question you asked, and if you have a question for a specific panelist, please, try and identify that as well so we can include that in the question. a few other housekeeping things, very important thank yous, we

would like to thank jan case securities, it would not be happening without them and also our partners at bloomberg view, bloomberg government, the cfa society of washington, the organization for international investment. all of you, thanks very much for being partners today, for making this happen. and this happens more than just here in washington today. bloomberg link hosts summits all over the world, 30 in all, and if you are intrigued by attending another, let me mention a few that are coming up. the defense conference near washington again on june 21st should be another action-packed event. chicago on june 7th, bloomberg asset management summit in boston on june 14th, visit bloomberglink.com for full details, so, please, check that out when you have a moment. and with that we'd like to get this show on the road, and we are beginning with the central issue, again, in this presidential election year, the

state of the economy, tailwinds and headwinds. and my colleague, dan moss, is going to be moderating that panel discussion, and if he and his guests could come up here on stage right now, i'll do a quick introduction, and they'll get this show on the road. let me tell you, first of all, about his first -- dan is executive editor of bloomberg news responsible not only for government, but also economics at bloomberg, and we have here, as you can see, two of our panelists, robert f. engel and michael armellino, director of the volatility institute, the stern school of business. he's a nobel prize laureate in economics, 2003. we thank him for being here and daniel yergin is the chairman of ims cambridge associates, the author of the pulitzer prize, also the author of "the quest: energy security and remaking of of the modern world," which "the new york times" said is necessary reading for lawmakers, spies, tech geeks, thriller

writers among others. and with that introduction, dan, please, take it away. [laughter] >> [inaudible] final question at his press conference on wednesday, and, peter, you asked that here we are, the economy has been growing for almost three years. what in the chairman's perspective is the most confounding thing about this recovery. his response was that the most frustrating thing was that the recovery is still quite slow, and unemployment has not dropped below 8%. so, rob engel, the chairman says he's frustrated, but should he be surprised? >> well, i think we expected this to be a long recovery because financial crises tend to have slow recoveries. in addition, it was hard to imagine how to have a recovery if you can't get the housing market to recover, if your

trading partners are weak. we didn't anticipate the european sovereign debt crisis. that's been a real negative, i think, for the recovery. and i think it's still moving, and that's what's the good news. >> the fed uses the term "modest to moderate" to describe the current expansion. what has to happen to get us beyond the modest part? >> well, i think that we need to take a little, quick lookback at the great depression where we had a similar sort of a financial crisis. it lasted years and years. and then in '36 and '37 there was an effort to rebalance the budget to stop the deficit spending, and the economy turned

back down again. so i think we need to keep our eyes on historical events like this and recognize the need for stimulus in the short run is still with us. the long run austerity that is needed to bring our revenues and expenditures in line is ever more important, but we can't cut the stimulus at this point without turning the economy back down again. >> well, vince reinhart, you've scrutinized the aftermath of financial crises. should the chairman really be surprised. >> >> not particularly. my wife, carmen, and i did a paper for the jackson hole symposium about a year and a half ago which was nothing but bad news. but the bottom line is we looked at the 15 most severe financial crisis of the second half of the 20th century, and ten years after the crisis the level of gdp per capita is 15% below that

predicted by the trend ten years prior to the crisis. so financial crises have long-lived consequences. we always leave unfinished business. we always have a very pronounced leverage cycle, and we always have regulatory overshooting. and the united states has ticked all three boxes. >> can i jump in there, daniel? i think that regulatory overshooting, it is very interesting as we went into this crisis, it was as though the great depression was not something that happened a long time ago. and one of them is also about the importance of business confidence. if you go back to that period, '36-'37, if you have a hostile environment to investment and decision making, that has a feedback loop, and i think that's what vince was just referring to, and we shouldn't forget that part of it. >> so here's a question for you. do you know what the top marginal tax rate will be ten months from now or the -- [inaudible conversations] >> i'm not going to tell anybody. [laughter]

exactly. >> or for, what environmental policy will be. there's always an option value for waiting in fixed investment, and the option is probably pretty valuable right now. >> yeah. there have been a few monetary division affairs at the fed, what does the fed do now -- >> could i deny that? [laughter] >> chairman bernanke's stressed a number of times on wednesday that there are things that are within the fed's realm and things that are not. what would your advice be? >> so the overall message the fed has sent is it's resigned; that is, it's not willing to get inflation above goal, it's not willing to use its balance sheet much beyond what it's done unless the data materially soften. so it's saying in its forecast this is the best it can get. that's not particularly good. i think there's probably still scope for a balance sheet action that's conditional, contingent on the economic outlook. as long as the fed has a

forecast that is materially short of both of its goals, it's got a responsibility be to use size and composition of its balance sheet to provide more policy accommodations. >> so, dan, without the drive to energy self-sufficiency, how much worse would things be? >> i was struck by the title of our session, headwinds and tail wends. if we look at energy, it's both a headwind and a tailwind. the tailwind is in your question which is the growth of u.s. production. it's up about 20% since 2008, oil production. certainly what we've seen in natural gas, low prices have helped to offset some of the high oil prices, and i think one of the things that's become apparent is this big expansion of energy in our country has very long supply chains and a lot of job implications. so two things, we would have less jobs, 600,000 jobs created by shale gas, and if our production had not increased by a million barrels a day given

the tight oil market we have, we would be looking at much higher oil prices than we're seeing today. >> so let's talk a little bit more about the employment aspect of that. how is the drive toward energy self-sufficiency reshaping the labor market both at a macro and regional level? >> i think it's turned out to be a surprise about how extensive these supply chains are can and the job creation that even if you look at offshore oil or shale, it creates manufacturing jobs in ohio, it creates i.t. jobs in california, and, you know, i think -- even i think a couple years ago i was more focused on energy security, balance of payments and not so much on if you have these rather large dollars being invested here in the united states rather than being in a sovereign wealth fund somewhere else, it has a big impact. it really radiates out into the economy, and i think you can see the shift that that has occurred here in the political discussion in washington, and a lot of the discussion about energy is really now a discussion about jobs. >> in terms of the economic data

that's been released this year, the perception amongst most economists is the year got off to a pretty encouraging start. now, in the last two weeks the narrative has been slowdown. so, rob, are we headed for a repeat of last year where the slowdown became quite substantial as we headed into the summer and people were talking about double dip? is that on the menu again? >> well, we've had such a big turn around from last summer til the sort of the middle of the first quarter as financial market volatility dropped from, well, the aggregate was 45% down to well below average but, actually, for the financial sector it was much high or than that -- higher than that last august, and it's come back down again. so we've had a blip up in the last few weeks which corresponds with these, the new gdp numbers.

i don't think this is the beginning of the next high volatility and negative information for the economy, and there are a couple reasons to feel encouraged by these gdp numbers even though they were not up to expectations. they're still robust. and there are some reasons to look inside the numbers to feel encouraged. particularly interesting is the residential construction number which was up 19% from previous quarter, and when you couple that with the case-shiller housing price series which if you read it care through, you can say -- if you read it carefully, you can say, well, it looks like the bottom has been reached might suggest that the housing market is actually a source of recovery, and this gets added to consumer expenditures which have been, were very strong in the data.

so if we could get business to come along, and this is the point that you're making, if we get business to come along, maybe this recovery is alive and well. >> vince? >> so do not count out the resilience of a market economy. market economies, basically, want to grow unless they're impeded. but here's the problem, the world's a risky place. there's an ongoing sovereign and banking crisis in europe, there is a risk of elevated energy prices because of events in the middle east, and we face a fiscal cliff on december 31st. our politicians have dug the equivalent of a five percentage point worth of gdp hole. in a world in which you have such uncertainties, investors reasonably lack conviction. if you don't have conviction, you don't have durable wealth creation. and it's wealth creation that pulls an economy up relative to trend. so in a risky world without

conviction, you don't get the wealth creation, so you grow a trend. the bad news is the trend right now is depressed because we went through a severe financial crisis. hence, we grow something in the neighborhood of 2%. can we do better? most surely. but are we, in fact, you know, impeding our own progress? yes, almost surely. >> so accompanying that increase in consumption was a decline in the savings rate. >> uh-huh. >> how significant is that? >> don't think it is. it's mostly about the quarterly pattern of gdp, basically, a whole lot of pent-up demand associated with the earlier rise in energy prices at the end of '10, 2010 into 2011. we had a lot of purchases of durables late in the year. the saving rate tends to be paid fairly closely pinned to the wealth income ratio, and that's the bad news because we

destroyed something like one and three-quarters years' worth of income equivalent of wealth in what we did to ourself in 2008 and '9. and so as long as we don't get that durable wealth creation, there's going to be a need to save, and if there's a need to save, then consumption isn't the overall contributor to g,dp growth. we got some good news. we're a big nation, we're building houses on both of the southeasts and, rather, in the middle part of the country. that's a contributor to gdp. we have a strong external factor, that's contributing to gdb. that's going to offset the higher savings rate. >> let's talk about those energy prices, dan. some of the recent softness in consumer confidence has been attributed to energy prices. where are we going with this? >> i think that a lot -- obviously, it's partly what we're talking about here and the

ongoing drama in europe and what pace the global economy grows and particularly the emerging markets. the other thing is that starting in november we entered a new phase in the relations with iran over its nuclear weapons. when the u.n. said iran is assembling the elements for nuclear weapons, a lot of things happened. our sanctions on iranian, on anybody doing business with the central bank of iran go in at the end of june, but they're already starting to have their impact. last week or two there was this relaxation in negotiations, they're going to have, meet next -- this month in a neutral city, baghdad, to continue negotiations. and so, you know, you see israel kind of debate, so there's kind of, you know, that's taken seven or eight dollars out of the oil price because, basically, it's a security premium. it's still high. we're still on a track to tighten, to see the oil market tighten as these sanctions go into place, and then the key question is where is the other

supply going to come from, and that will really determine the price. but i think there's no question that oil prices as in 2008, you know, high oil prices are a drag on the economy, and they add to the worries of consumers. they take purchasing power out of the economy, and so i think this is one of your big headwinds. >> so in terms of the macroeconomic impact, it doesn't really matter whether what's driving it now is different from '08, it only matters where its goes up or down. >> yeah, and how much anxiety there is over expectations about the future. it is, you know, in '08 we were, basically, looking the kind of world discovered that emerging markets really count. that was the fundamental thing. this time it's, it is iran and a tight oil market and, you know, the need for new supplies. >> i mean, it's always worse when it's about supply. if prices are going up because of concerns about supply, that is more material when the prices

are going up because it's global demand growing. >> right. >> because demand is an offset. so '08 is a little different than 2012. >> i always remember two months before lehman brothers collapsed, oil prices hit their peak, and who was really hurt the most was people who were paying subprime mortgages. >> let's do another comparison with '08. china was perceived to be one of the big heroes of that period. not just because of their stimulus, but certainly that was a major, perceived to be a major contributor. now we have china slowing. so what role can china play? >> well, i think one of the things that happened in china is the stimulus got out of control. the stimulus -- >> too much of a good thing. >> it was too much of a good thing, and it was, actually, turned out to be very difficult to monitor. when once the spigot is opened at the top, then every municipal government says, okay, this is

my opportunity to build the new construction that i want to build, and china has been on a building spree, and there is a mountain of debt that we don't know too much about yet in china. and there's a question of whether that is, ultimately, going to be a big problem in china is still to be seen. i think the fact that china is able to sit down and make five-year plans and design policies that are targeted at whatever particular problem they have in mind is actually very promising. i think if we were to come up with five-year plans, it might be a kind of a useful exercise -- >> five-week plans. [laughter] >> if we could carry it out. so i think there are a variety of things china can do. they have a big war chest of dollars sitting there they can

throw at this problem. but i think it is a concern. i think -- >> can i add, i mean, what i call the buildout of china is clearly one of the fundamental factors driving the world economy. however, you know, we tend to think that everything is very well organized there, but as we can see this kind of disarray that's going on in terms of the leadership right now, it is a transition point, a very critical point. it only happens once every ten years in china, and that adds kind of to the uncertainty of the whole picture. >> it's a very opaque economy, and the line between the public and the private sector is, at best, indistinct. good news about that it means there's lots of levers of policy. the bad news is that every ten years or so they have to take a hit associated with mistakes you make in terms of allocating capital and credit on such a large scale. it's probably the case that chinese officials would not take

that hit in a year of transition, a year in which the global economy is at risk. the problem about china over time as the middle class gets bigger, as there's more market-related activity in china, it will become less and less a decision of the official community when to take the hit. we don't think they're there yet, so that china doesn't grow, doesn't slow. it'll be a continuing contributor to global growth which is good news because the u.s. is, at best, a trend and europe right now is in a shallow recession. >> and one of the undercurrents, not so under of this leadership change in china, is that struggle about how much the economy's going to be driven by government, by the party and how much of it is going to be more market-oriented, and we're kind of seeing that play out in front of our eyes. >> we've been talking about debt in the chinese context, but let's talk about the