on sunday into:00 a.m. on monday and also watch after words of mine. go to booktv.org from your in university about their book. joining us now is peter

blair henry "turnaround" is the name of his book for also the dean of new york university with this glove business who was leonard stern? >> the benefactor of the school started with the company growing into of real-estate empire began to is a very generous benefactor to the school and then gave a very large gift of $25 million that provided the graduate school and the internet program. is that stern school of business have a philosophy?

>> our mission is to transform the challenges of the 21st century. in use the tools of business it turnaround losses for first world growth? >> what can they learn? >> in to to learn from history from the struggle has we whole discipline and clarity and a trust. so what does discipline maned? >> so with fiscal austerity with fiscal policy with

sequestration with the slower growth in the economy. the reason i ended that way in the first place that of the fiscal side when times are good and when times are bad. fiscal policy because copper prices are rising. em with the record surplus the people took to the

street in march with the finance minister. did to say this is monday for a rainy day for a potential crisis in 2008. to stimulate the economy to keep things moving without running large deficits. but contrast to the united states in 2001. to give money back so to speak. and then we end up with a situation but to see those

record surpluses in the form of higher spending. id we did not learn that lesson. said that is the discipline matters. >> so to turn themselves around because of demonstrating that clear commitment. if you look at europe we have the following mixed messages.

this strongly recovered. to do whatever is necessary on the monetary side with the monetary transactions. but often the fiscal side to be engaged in the european fiscal compact. with the threshold below the gdp. edge against monetary policy. but for that lack of clarity of sequestration to create

the of monetary policy. but trust is the third point. is that modern economy to allocate financial resources from excess savings that generate economic growth. those transactions as long as there is trust. with the lack of trust a lack of clear economic policy.

event investment is the fraction but part of the reason why was real capital investment. that is still below the peak years. and that is a lack of clarity. and also a lack of trust. if you talk about all of this u.s. economy. there is some growth. >>.

>> guest: here is the key point united states economy is growing again. is clear in this situation with the with expectations about the future and underperforming. this is a lesson that applies to emerging-market. during the past four years from monetary policy and not taking full of vintage of monetary policy. with greater investment of infrastructure those are the

forms so emerging-market its the '70s it '80s and early '90s that continue to hit the positives. but we have not dealt with those unemployed issues. so many hard feelings. is and what we paid no is the key to solving with long term prosperity. also phratry were

high-school brokers but we have a conversation right now how we do that. to tell us we score in 10% and there's a lot of smart kids with the kid also tells us the condition through the united states so we lack the discipline right now for our education to help us create

the 21st century workforce. so to underperform that is the point so those of emerging markets are not the point. id by the way those emerging markets remember in the labor reckitt policies and they also concern growing from that great. >> host: isn't it equality great then other nations? >> guest: it is on the rise so it is the direction. over the last decade

middle-class families have never seated increase. one of those important lessons that occurred if you want to create prosperity but the most poignant examples comes renewed country of jamaica where was born. in the '70s it wanted to address income inequality. so we put up a set of policies that was revenue neutral.

so then they would redistribute the policies were they said there is no room for millionaires in jamaica. if you want to be a millionaire go to miami and what we say matters very much. lawyers or doctors including my parents their left the country. so by creating an environment in which there is uncertainty about the future, and what leaders say matter. my parents did not want to be millionaires just lab equipment but they left the country. so by creating an environment in which there

is uncertainty about the future, profit is a dirty word to undermine your ability. and my concern we're at a moment there is a large income inequality in the united states and a lot of discussion on wall street to capitol to feed a cycle of rising discontent my worry is if leaders don't exercise that long-term thinking or discipline with those responsible ways to deal with income inequality we run the risk of not earnings of less than that to make a trade you cannot lift up the pork it has to be part of the solution you either lift

people up to redistributed income and have a legitimate conversation about progressive taxes but that is not the point rather than having a heated discussions about minimum-wage and policies let's have a serious discussion about how we put in place policies to create access to education make easy for businesses to invest make it easy for people to create opportunities. >> host: peter blair henry survey on the transition team 2008 ronald reagan used as a rising tide lifts all votes of those statements that you agree with? >> guest: the rising tide does not lift all votes but

it has not been in their praise so we have to recognize that broad principle could harm the greater good but there are market failures and real also have policies in place to incentivize behavior's so maybe a specific example in the united states we have a tax code that says if you own a house and you take out a loan to buy the house with up to $1 million of debt you can write off the interest payments. we have no such uniform incentive if you make more

than $100,000 per year you cannot write off the debt of your child student loan so here is a skewed policy that encourages people to build and buy large houses and that is okay but we don't encourage people to invest in there child's education. sometimes the boat needs a little whole person steering but to play a positive role with the right incentives for people to engage in productive activity i invest in educating children for the future. >> host: should the minimum-wage be increased? >> guest: i believe it real terms is 20% below where it was but personally

i think it would do a lot more good for lot more people but have you really create access for a blow in, i achieving students? how to regenerate or produce that workforce? to bring more people lot of low-skilled too high skilled though wages will rise and we will create a scarcity for those at the end of the work force. you cannot get away from the fundamental to deal with the underlying issues rather than the symptoms. >> host: issues have started with this but page five of your book economics is all about miss mama's.

>> yes of figure from my past when i was a child growing a bit in jamaica i would spend a lot of time a grandmother's house she was a terrific teacher i would sit on the veranda reading books having conversations with her but everyone's in a while miss mama would not from the gate their flight she headed distended belly be issued to not having enough to eat and matted hair like grandma would always give her something to eat i always wondered why can miss mom i have enough food? studied economics later if you want to help people certainly extend kindest to give them food but teach people how to feed themselves that is the way to lift people out of poverty.

and it starts with economic policy. the policy decisions the government's make today and tomorrow and the next two months what impact people's lives in this rich country of the united states but certainly in developed countries like jamaica and brazil fell to have a profound effect on millions of people's lives and it lays out the lessons from the third world countries struggle to say this is what we know about how to put policies in place for those who want to help themselves and by the way there are plenty of miss mommas in the united states not just in jamaica. >> host: peter blair henry you have talked about jamaica but you have a comparison in your book

"turnaround" what is the difference? >> guest: jamaica and barbados are interesting cases geographic as close as you can find to twins in the world they're both former british colonies. jamaica barbados gained independence with this same government they both have the same rule of law in the same protections for public private property. so for much of the research that we know even with the big push to say the institutions drive economic growth so they're the same bequeathed to them but over

the 30 years' post independents barbados was steady as you go. in jamaica had a terrible collapse. to the point the difference between with income per capita the average family just that difference is greater than the average overall level. it happened because barbados the leadership understood discipline and clarity and a trust but in jamaica the leadership had a vision for a more prosperous future but did not follow policies so ignore the discipline. a favorite example of aicher share it of leadership in barbados 1991 the country is

on the verge of a financial meltdown a small country that relies heavily on the ports. weber about to run out of u.s. dollars. the imf since the team to barbados in they said you must devalue your currency and has to go to 1.9% her betas dollars. make it worth less so people will import fewer goods in exports are cheaper it is cheaper and take a vacation that will help you to raise your intake of dollars it help you to solve this problem.

the people said no we don't want to do that because if you do if you devalue the currency people's wages are worth less their last four and increase their former employers will raise prices to set off a low wage price spiral of inflation they said we have an alternative plan we will go to the workers and ask them to take a wage cut directly. without getting into all the details it barely passed with the wage cut and workers took to the streets of bridgetown 30,000, one-fifth of the country took to the streets like the equivalent of 30 million washing -- marching washington.