spain. members of congress will likely mark the one-year anniversary back in their home states this morning as the house and senate are out of session thisç week. we will begin with your assessment of the recovery act -- what grade do you give the initiative one year later? joining us on the phone is the associated press national reporter to give us an idea how the white house will mark the one-year anniversary. jim, what will they be doing? çguest:ç the president, as he said, will be giving a speech. they also sent the president's cabinet, fanned out across the country, to promote what they are saying is the great success of the program so far. yesterday the vice-president was in michigan, the state that has

been hit the hardest by unemployment. they are trying to put a good face on a program that has become a target of republicans, frankly,w3 who compare the amout of money devoted to job creation to the unemployment rate which reached 10% and is now at 9.7%. host:-president joe biden is expected to give a report to the president on the stimulus one year later. guest: the report says that the program so far has created or track to create 1.5 million jobs thisi] year, a totalç of 3.5 million, which was theok initial target the administration placed. host: let's put up on the screen for our viewers, the recovery act and media goals. this is that recovery.gov, the

administration's web site. immediate goals were to create new jobs as well as save existing ones. w3spur economic activity and invest in long-term economic growth. and foster unprecedented levels of accountability and transparency in government spending. you talked about the first one. well the vice-president report say that one year later they met thew3 most immediate goal of creating new jobs and saving existing ones? çguest: yes, they have. jjñ and many economists will agree with the assessment the administration is arguing, which is but for this money, the unemployment and the state of the economy would be much worse. the problem that the administration had wasç in a essentially presenting aç litte too rosy a picture back in the beginning of 2009 when it was pressing congress to adopt this plan. the economy turned outç to be r

worse. we've lost 8.4 million jobs i]since the recession began in 2007. so, the president and the administration has had a much bigger hill to climb. but jobs have been created on the -- created. on the point of transparency, it has had -- been a fairly open process, which has led the program to scrutiny from both reporters and congressional investigators and other independent watchdogs have discovered some problems here and there as to whether the numbers are in fact as optimistic asi] the administratn might claim. in thei] main, there has been jb creation and job savings, particularly at the state level

and the local level where localities face incredible pressures on theirç budgets to lay off workers and were able to forestall some of that with stimulus money. host:çt( let usç take the secd most immediate goal -- go[4 spur economic growth, long-term economic growth. when it comes to the unemploymentç figure, president stimulus bill would keep it below 10%. how have they done on the second goal? guest: that didn't happen -- we reached 10, 10.1% unemployment. it is bound to hover inxd that vicinity for some time before it starts dropping again, and the administration does not expect to have unemployment below 8%, below 7% until 2015.

so, the long-term picture is one of a very slow economic recovery. the way the stimulus money was spent -- by the way, the stimulusç is often described aç a $787 billion program. the congressional budget office, which keeps track of these things and determines the actual cost, now places it more at aboutt( $862 billion. but nevertheless, about one- third of that money has been already spent. it has been spent on unemployment benefits, food stamps, tax cuts, and aid to states and local communities. the next effort is aimed more at infrastructure projects, long term projects that go directly

to the private sector. and that is where the administration is hoping it can launch a stronger, more lasting recovery by getting money into the private sector and that the private sector can move on its own after getting this impetus from the stimulus. about $150 billion kind of in the pipeline to get to these ready to go projects right now. host: the infrastructure spending will be the focus for 2010. how many years will the money trickling out? guest: the book was last year and this year. -- thoue bulk of last year and this year. 2011, and then after that smaller amounts, much devoted to unemployment and some lingering projects that might still be out

there. but the bulk was last year, this year, and a bit in 2011. thank you, sir, for your time. host: one of ourç viewers twees this. first phone call, columbus, ohio, johnny on the democratic line. go ahead. caller: thank you. i give him an a because he came into a mess, and i want to the economy and the people and money spent on basketball, football, where it is sold out. people contribute money. the economy for us here for the people in the bottom is fine, it is the top, the head is cut off

from the body. if they would sit back and relax and listen to him and quit the talking did we would get our economy back together. host: in your town of columbus, ohio, where do you see stimulus projects? have you seen a direct link? çguest: they greeted about 60,0 jobs in columbus. they say they did. i can't prove it. they said they did. and a lot of people are back to work. but the economy started with the bank thing. when the banks crumbled everything fell apart because when that had falls off, the body parishes. you know that. as far as the stimulus is concerned, he did what he was supposed to do. the ones who are not happy are the ones who do not want to see the country to survive.

they want it because we don't -- we have a black president. but i have news for themç moved here in 2007 and i saw hillary clinton, i did not watch news then. i was not -- did not know she was running for president. i said i would vote for her because she is a woman. and then i heard barack obama speak and when he got on the news and started talking, my tv went out -- host: we are goingxd down a different road here so we will leave it there. curtis on independent line from baltimore. caller: i give the stimulus an a. a lot of people out there who don't even know -- for the people getting unemployment right now, president obama, he tacked extra money on the end of that so when it ran out he would still be pumping out a couple of checks. he is trying his best. this guy is actually trying his

best but anybody who has been watching what is going on, the republicans are blocking him. if you voted, if you need health care or something going on wrong and you wanted change, you should turn on your tv and see that the republican guys are stopping getting health care. çhe is trying to say give money back because the bank aren't -- bank guys do a pretty good. host: all right, joe on the republican line. give his current program an f. and the previous caller lre ççeconomy, is just foolish. i would suggest also that your ççapçç reporter -- he is ay goodçw3 witdr carrier for the çadministration. whatever the administration puts w8÷t( he reports on. does heçççw3 do independent g

himself? %dmd]. facts and figures on the stimulus? ç ú]ç

new jersey on the democratic line. good morning. caller: how are you? host: what is your grade? caller: i would give it a b. i actually would have preferred the stimulus money, a larger chunk goes back to individuals to put the money into individual's hands. but overall i would give it a b. i find it interesting when you asked the last caller where he got information about the stimulus, he , hean f, and he

could not give any source of information. i think there is far too much going on. i also do not think -- think it is odd, i hear the oft-repeated law that the obama administration promised unemployment will not go above ç8% and i have looked everywhee -- media matters, c-span, obama's speeches, statementsç n newspapers and google and of no where did they promise of the unemployment would not go above 8% but yet you hear republicans repeat this canard every day on c-span. i think that obama -- i think the people need to check themselves. i think they need to realize th# cobra benefits, some stimulus money weítç to that. police and fire and road clearing. we had a record snowfall in the northeast. i]these states and local governments are using the stimulus money to keep the road( clear. highway building, bridge is

being repaired in the jersey and pennsylvania. i don't know where these people are getting their information from. i think obama is doing a good hoet people in this country need to understand he has served one year of a four-year term and before they start talking about throwing him out let this guy do his job. host: let me ask you -- where did go for facts and figures, recovery.gov caller:: i go to recovery.govç, c-span, media matters, you too, congressional services -- there are all sources of information. i think the problem is people are so locked in sort of their own ideological bent that they refuse to see any good that this guy does. i am not suggesting that obama is the perfect president but i think people need to realize, we

lost from december to february -- december 2008 -- december february 2009, 2010 -- i am sorry, the three months before obama came in, we lost 1.3 million jobs in this country. host: let's hear from a republican. john from philadelphia, mississippi. çw1ókççcaller:w3ç i can spean got a job through a company that gotçqçç[?23ç a road buildit justçç outsideç philadelphiag from meridian back into town and he worked three of four months, good paying jobs. and the winter weather set in and he was laid off, still laid off, was able to get unemployment for not working on that. there is always the prospect of

him getting rehired. but in the meantime, he applied and did not get the job but applied with of the local police department over there in that meridian. that was directly part of the stimulus money. host: what does that mean for you? caller: i'm sorry. my grade would be an easy b-. i think the main problem here -- and i hear from a lot of your callers, just taking one side or the other just got to stop. this country is so far gone economically and morally and ethically, we got to work together or this thing is not going to work. i don't care if it is a republican or independent or democrat, what ever.

he is doing as best as any president in the past could have ever done with this enormous problem. thank you for c-span. host: vice-president joe biden was onñr "the early show" defending the stimulus and he said american taxpayers have gotten their money's worth. he also says we are onlyç about half way through. çnorth carolina, chad ojúáhe republican line. caller:koçmemoçvçvzçi]kr i would give the recnb)y act att in my area here, i have not seen any jobs being created. these shovel ready jobs, those are not sustainable, just like he is growing the size of government. i would think the majorityç of the jobs being filled our government jobs, which we don't need.

çthe only spend, i think, a thd of thew3 stimulus. why? why are we only spending a third? ççç[óo ç

manufacturing back in this country. this country has been shortchanged on manufacturing and they should charge a tariff for anything that comes back into this country and you will get the country back on its feet all the way with manufacturing. host: arcadia, florida, richard on independent line. caller: good morning, greta. no higher than and f. this is ridiculous. the stimulus package comes into

play and unemployment at 7.2% and now it is 9.7%. and the caller you had earlier -- i don't know where he was from, he said he did not know where the 8% unemployment came from. it came right out of president obama's mouth. i just talked to a friend over the weekend, he has a title company. he had a 30 people working for him that he has to lay off because there is no construction hardly going on in florida right now. it has gone down -- the stimulus package is a slush fund to get people in elected and to pay favorites back to people. this is not to create jobs. the way to create jobs -- 80% of the jobs in the country are in small business. so, stimulate in the atmosphere for small business. you cut taxes. you create opportunity so they

can expand and grow. host: speaking of politics this morning, two different headlines, two different takes on the same story. here is "the wall street journal" this morning. that is the way the wall street journal phrase it this morning, saying republicans face an uphill battle as a they have to go after 10 seat -- that have to gain 10 new seats and retain all of their own to gain control of the senate. here is how cold the new york times" -- "the new york times" phrase is the same story. rome, georgia, susan on the republican line. caller:: good morning. host: what is your grade? caller: i just wanted to say that i think there has been too much money spent in washington.

we are going in debt to far. my husband is retired military man. 100% total disability, and i am not work as much for my husband and myself as my children and grandchildren. can i say one more thing? host: go ahead, susan. i want to show you something as well caller: i want to say to all of my black friends. i am white but i have a lot of black friends and i live all over the world. and i'm no racist. i want to tell him -- them, i did not dislike obama. it is some of the people he picked in his cabinet. it to host: i want to show the headlines in the paper. president obama thursday is going by executive order to announce a debt commission headed by former senator alan

stinson and burst and bowls. if you can see their picture at the bottom -- alan simpson and erstinçóçó bowles. philadelphia on the democratic line. caller: i would say i give its a c. i think the biggest problem with this, corrected, is that most of the money is going to state and local governments. i think that is a recipe for disaster. i think it is throwing money down a rathole. ok, maybe it keeps some state and local jobs but have to believe a lot of this money goes to beef up the pensions and beef up the benefits of state and local employees. not that there is anything wrong with that but how does it create jobs? and what i would like to see because the actual cost of close to $1 trillion, maybe a

broadbased tax cut. get the private sector back up. if you take the marginal tax rate from 25% to 15% for working folks, give us a 10% tax cut, it would spur demand. as far as the deficit goes, let's get out of the mess we are in now and worry about the deficit later. when the republicans were in power they did not care at all about the deficit and now they are out of power and they are all deficit hawks. i would take the hit on that and move on. host: this is "the wall street journal" article, a little more. subsidizing the state and local jobs --

chantilly, virginia, republican line. you are on the air. what is your grade? caller: good morning. my great is f, ok? i am sick and tired of the government lying to us. as long as they keep us divided, we are never going to go anywhere. let me tell you something. we have a president -- when he was running for office he said some many things, and he lied about just about everything. he said unemployment -- one

caller said the duty he said it was not going to go up and it went up already. the first light. he said it would be transparent to. no transparency. we have the symptoms -- what is causing them? let me tell you what is causing it. what is causing it is the big banks that owned our governments. we do not have the government any more. the bank owns a the government. it is just a little. group, the elite class that rules the world. host: a capitol hill newspaper has this headline -- they note nancy pelosi issued 260 statements on the stimulus package of the past year, in an effort to win a debate that could be the key of retaining the democrats' majority in the house. you can go to "the hill.com" for

the story. caller: i would like to give its a b. host: why is that? caller: i see he is trying to get everything out there. even if he puts together a homeless center and try to create jobs the republicans would block it. i just wanted to say one thing, though, if all of these guys talking about where to the terror trial -- do it in baltimore. i think you should throw it to baltimore. this stimulus thing, if you noted earlier somebody doing some wrong stuff and they keep slamming these bills down then you should vote them out. you should be angry and vote them out and there should only be good people trying to get things off the ground and help americans out, those are the people we should be elected.

host: does that mean in 2010 you will vote against incumbents? caller: i will have to see what they are going to give us. what will be the set up and what kind of people are going to be running. but the thing is, if barack obama runs again, maybe i would vote for him. but the thing is, the guy is actually trying and the republicans keep shutting them down. i cannot get health care. kind of elderly, but, but republicans keep shedding things down and i need some help. host: cnn yesterday released their latest poll that said 52% of those polled say president obama does not deserve reelection in 2012. about those incumbents, this is a poll this morning that is an "the new york post." voter support for incumbents hit historic low. also from the cnn poll.

34%, people would think there member of congress deserves to be reelected, 63%-should not, and 49% think president obama is doing a good job. michigan city, indiana. the republican line. caller: i think i would give the current package a c, c-host: why is that? caller: i think, based on what i'm hearing, a lot incorrectly placed on the president when i think congress had a lot to do with stuffing it with pet projects and that sort of thing and a lot of it got misguided. you talked about shoring up different kinds of aid that was already in place. i think that should not have been a stimulus item, that is more along that line of

recurring budget kind of item. if you are truly going for stimulus -- the infrastructure work in a little bit. i worked kind of with the whole industry. what the effect of the outcome was, there was a quick boost in workers for very specific fields such as street paving projects. the companies that were involved, i had a few projects, were real busy for a while, but there were so many bureaucratic agencies that by the time it trickled down, it was a very specific -- it should have been a lot of -- a lot wider program. host: you said the stimulus bill was full of pet projects.

where did you get that information? have you yourself on to recovery.gov and other places? they're independent web sites tracking the stimulus money. there's other ones. have you gone to see for esl that there are projects? caller: well, unfortunately and a lot of them i am not aware of bachelor how many there are and i could not tell you which one i have gone to but i have gone to several including recovery.gov, and a lot of them have -- they want to show you the efficiencies in the bill, and there are some. some of them are just, you know, obnoxious. it is real hard, especially after all the controversy with the amount of jobs created, i will agreeing that the

unemployment rate could have been worse if a lot of stuff was not put enacted. but there are so many conflicting sources of information. i am pretty sure if you go to multiple web sites you would get a much different picture painted for you what is actually going on. host: let us hear from independent. al from springfield, virginia. what is your grade? caller: migrate for failure is a and success id an f. propping up state and local governments for money in their retirement funds and so they can continue to pay out benefits to state employees and county employees and all of this, those other things that need to be addressed. we need to get all of these state government workers retirement plans back to the way it is in the private sector. 401k plans and investment plans

and stop this constant going to the taxpayer, increasing taxes and stuff. these outrageous retirement plans that teachers, firemen, and people like that debt. those are the issues that need to be addressed. host: politico.com has a story -- the obama and of paramount in retreat. the electorial -- el toro map obama remade in 2008 appears to be retreating into its familiar patterns. also on the tea party, politico has the story this morning about activists to unveil mount vernon manifesto. conservative leaders gathering in virginia today will sign onto a broad statement of principle aims to give a coherent framework to the grass roots energy. one of the tea party activists writes this morning in "the washington times." still just folks.

it stopped try to categorize us and just start listening. -- stop trying to categorize us. chicago, mark on the democratic line. you are next. caller: i get the stimulus package an a. if the go to white house.gov, or

recovery.gov. if anyone believes the recovery act is not working, then why don't the republican congressman and senator stop taking photo ops of the checks? a couple of baalbeck said the reason why companies leave america is because of taxes -- a couple of callers backs of the reason why companies live americans because of taxes. it has everything to do with cheap labor. that is why they go to china and mexico. if you read the book "audacity of hope close " the president talked about how whirlpool went down to mexico -- "audacity of hope," it push the president talked about walpole went down to mexico. and that company going to canada. i give the president and a. i think he is doing a dam good

job. people need to give him chance. if you are a deficit hawk, how come you were not a deficit hawk when the republicans were running up the deficit with wars and tax cuts for rich and everything else. host: an e-mail from one of our viewers -- written by one of our viewers this morning. you can e-mail us at journal@c- span.org. jim on the republican line. what is your grade? caller: an f. host: why is that? caller: it does not make a lot

of sense when all of these banks and all of these big industries, how they are spending the money. we need jobs here in the united states. each state of the united states, we need to take care of our own. host: omaha, nebraska. john on the independent line. caller: a c-on a bad day and cplus on a good day. have i told you i love you, c- span? i am independent but i was there was a fourth category because i am interested in that tea party thing -- the democrats and republicans have both spent us into oblivion and i am getting fed up. i am a truck driver. i see the need for the new bridges and roads. i see it every day.

the roads are going down, down, down. we do need that. that is why up to like a c. host: rita on the democratic line. are you there? caller: i got through. it is an a. i'm from dayton, ohio, and i see what we are getting from the stimulus funds. we are getting our bridges replaced that were falling down. we are also going to get a train that goes all the way from cleveland, ohio, down to cincinnati -- yes, to cincinnati with about five stops which is going to make us have a larger job market. in my source is c-span. i don't want anything that a neighbor or any newspaper editorial or any teabags people tell me that has been at the

chewed over that they are thinking about. i watch all from c-span and i get it straight from the source. host: two new pieces from the associated press. a senior u.s. official as meeting with the syrian president. but u.s. undersecretary of state for political affairs was received by the syrian president today. the first visit by the highest ranking u.s. official says january of 2005. on toyota, the president of toyota will not attend congressional hearings. he will be sending american executives. toyota's quality control executive says the automaker is looking at possible power steering problems with corolla, the world's best selling car and considering a recall. missouri, gregg on the republican line. caller: i give him an f.

i think the ability to generate jobs under his watch is going to fail because they are going to throw money at something, when he has cap-and-trade and this health care bill. companies are not going to hire people at this point in time. i think he needs to work on something else. he has continued to lie to the american people his first year and i think people got to wake up and see what he is about to do. guest: thank you for the phone calls this morning. we will leave it there. up next, we would talk to two folks, two different views on president obama's announcement yesterday the u.s. will be backing loans for nuclear plants. two new reactors in georgia specifically and more money in the pipeline to come. we will be back with that in just a minute.

>> president obama this morning is expected to talk about the u.s. economy and jobs as he makes remarks on the one-year anniversary of the signing of the recovery act, the stimulus legislation. live for you at 10:25 a.m. eastern here on c-span. at noon, and look at the 2011 budget for the national ossianic and atmospheric administration.

that briefing as live on c-span 8. this evening, national archives salute to the african american pilots of world war ii known as the tuskegee airmen, live on c- span at 7:00 p.m. eastern. >> with your wildest imagination, if you were writing fiction you could not have made the story appeared >> cannot gorman on the death of american virtue, clinton versus starr, interviewed by former special counsel to president clinton. part of book tv weekend. >> our companies, whether providers of video or those who invest to create the content, are working overtime to figure out how to give consumers all the content they want on any platform or device they may own as quickly as possible. >> this weekend, the head of the national cable and tele- communications association on what is next for the cable industry. "the communicator's" saturday on

c-span. your one-stop shop for everything c-span is that c- span.org/store. dvd is of our documentaries on the capital, supreme court and the white house, the series on presidential libraries and nearly every c-span2 program, plus a collection of books, while prince, -- wall print. >> "washington journal" continues. host: are back with radioactive waste watchdog, beyond it clear, and alan flint from the nuclear energy institute here to talk about president obama's announcement yesterday that the government will be backing new guaranteed loans of fourxd nuclr power plants, specifically starting with two reactors in georgia. can i get your reaction first to the announcement? guest: a terrific event for us.

it represents a remarkable moment in time. we have seen an evolution about the discussion on energy and climate, efforts to enact legislation to control card and limitations, increasing awareness about difficult it can be bought to meet our electricity requirements and some of the decisions that need to be made about what technologies we should pursue. the fact the president has come to the table and said nuclear has to be part of the mix and the administration is willing to support efforts to build new reactors is a tremendous milestone. host: is it enough? lindsey graham, who has been a supporter of climate change legislation if it includes provisions for nuclear power said yesterday this is a start. republicans would like to see more along the lines of about 100 new nuclear reactors, and the money that is in the pipeline right now would produce around 10. is it enough? guest: it is interesting to be involved in the discussion about

how many we need with different people proposing numbers. there has to be a process with the congress and the administration to decide what kind of programs and incentives the government wants to put in place. we are going to build some number of new reactors. they will produce electricity without emitting co2. the more we build the last we have to worry about co2 from other sources. building less reactors, we have to have carbon sequins -- carbon sequestration for other technologies. there will be a lot of efficiency programs. it really is a question of what sort of basket. the fact the president has come forward and said we will be building nuclear plants, that will relieve some of the pressures on the other technologies. we believe it is a great step forward. host: should republicans come to the table with him and agree and support the amount of money he has put a for the budget for nuclear power? guest: currently the administration is authorized

$18.5 billion in loan guarantees. the president requested an additional $36 billion. yes, we very much hope in the fy 11 appropriation process that $36 billion of new authority will be provided. that will give us the ability not just to build aok few reacts but, say quite a few, and as to justify building a new manufacturing capacity, new infrastructure. that isñi where a lot of the new jobs get created. we are very interested in decongestedñr that there is a ri industry -- we are very interested that there is a real industry as a result. faugh host: you are not happy. why not? ñiguest: very concerned about te financial risk. the congressional budget office says over half of the projects will default on the loan repayments. the way the loanñr guarantees wk is the taxpayer will be left holding theñi bag for billions f dollars per reactor. so we are very concerned about the financial risks.

we are also concerned about the radiological risk. these very reactors that were awarded these conditional loan guarantees yesterday, the nuclear regulatory commission last october identified a major safety flaw the shield to protect against hurricanes, tornadoes, earthquakes, crashing airliners. here we have a design with a safety flaw that is being supported by federal taxpayer financial risk, that gives a whole new meaning to the term moral hazard. and the environmental movement in this country is united in opposition to these loan guarantees. so we are hopeful this request from of the obama administration to congress to triple the program will be stopped before it is implemented. host: president obama talked about it yesterday when he made the announcement about the different sides coming together on this issue. he made the point of saying that this affects our economy, and

the tayside's need to come to the. we have a little bit about what he said. >> my budget proposes tripling the loan guarantees to finance saved, clean nuclear facilities. we will continue to provide financing for clean energy project here in maryland and across america. there will be those who welcome this announcement, those who think it has been long overdue. but there are also going to be those who strongly disagree with this announcement. the same has been true for other areas of our energy debate, offshore drilling to putting a price on carbon pollution. even when we have differences, we cannot allow those differences to prevent us from making progress. on an issue that affects our economy, our security, and the future of our planet, we cannot keep on being mired in the same

on stale debates between the left and right, environmentalist and entrepreneurs. host: kevin camp, he said this is not just nuclear pretty the administration will focus on wind, solar, other renewable energy sources. why not be on nuclear or other organizations meet the present and half way and support what he is trying to do? guest: there are good ideas and bad ideas and energy and nuclear power is a bad idea. we have 50 years of experience. the nuclear energy -- has not saw nuclear waste problem, catastrophic releases and, there is still the nuclear weapons proliferation problem. this is a 50-year-old industry, enjoyed lion's share of public subsidies and now the nuclear energy -- industry again is trying to gobble up the lion's share of energy loan guarantees

so wind and solar and efficiency are left with the crumbs. but those are the real answers to the climate crisis. it is time to make wise decisions. we can't do it all. host: i want you to respond to the loan guarantee issue because i think for taxpayers that is a big issue in this economy, that the cbo found that the risk of default on these loans is 50%. if each plant is around $8 billion, that leaves the taxpayer but that bill. guest: let me answer a couple of questions. the first question you asked of kevin is is there an opportunity to reach some sort of consensus in climate. that has been a very difficult issue here in washington for several years. we have seen members of both parties get involved with that behind the scenes, ask a lot of questions, the level of knowledge has gone up. and i think as a result we see more republicans willing to embrace real bulls, and democrats changing their traditional position on nuclear.

i think there is possibility for consensus. i don't think it can happen this year. it's very difficult in washington right now to get a deal on a proposal like this. but i think this represents an evolution in their positions, and i think we have to reach a deal on crime legislation enacted this is a big step in that direction. so i think it is very promising. eventually there has to be a deal and i think this that's the one with milestones. let me do speak specifically about loan guarantees. kevin has raised really a canard, a false issue. he is reciting a cbo report done in 2003 about a loan guarantee program that was not enacted. it was a proposal in 2003 for a loan guarantee proposal. this cbo gave an analysis and said some of things kevin has said. that is not the loan guarantee program we are talking about. it is irrelevant to the statutory program in place right now, where companies have made applications have received an a -- commitment. the commitments are conditional.

conditional on applicant needing a whole bunch of requirements. one is nrc improves the design. that is in process. nrc approves construction and operation. those decisions are not going to be made until 2011 or 2012. so we've got a long way to go through the regulatory process. in addition, when an applicant applies to the doe, they review the application and makes a determination whether or not they think the proposal is credible and what they think the risk of default is. in this kit they think it is extremely low -- in this case, they think it is extremely low. they charge the applicant for that risk. so the applicant actually pays up friends -- up front, write a check, to cover the risk of default. host: not the whole loan. guest: the risk of default. if they say there is a 1% risk,

they write a check for 1% loan, so and it totality of the portfolio, if they all have a 1% risk of default they get 1% from each applicant and the cover the anticipated default rate. it should cost the government nothing in the totality. host: critics are saying is because there is no economy for nuclear power because the regulatory structure of nuclear power makes it difficult for any of these companies to thrive, and on top of that you do not have, as kevin brought up, a disposal system before this nuclear waste. guest: let us take each one of those. first of all, nuclear energy is very competitive. for the last seven years the power sold from nuclear-powered plant has been the lowest cost source in this country, 1.7 cents per kilowatt hour, cheaper than natural gas and coal. very competitive once you have the reactors in place. in addition, the nuclear

industry does have a lot of regulations. in some ways, we embrace andçóó welcome the fact that this is a very strictly regulated industry. we pay the federal government's cost of imposing for the regulation. industry pays over a billion dollars a year to the nuclear regulatory commission to texas. 800 billion -- $800 million to the department of energy for the nuclear waste program which is in a state of turmoil and change right now, but we send the money every year. we are paying for the federal government's cost associative the operation. in addition, generating hundreds of millions of dollars of tax revenue to local communities and states, employ thousands of people. this is economically a very good move for us. host: kevin? guest: economic would rid the industry. i would like to respond. this loan guarantee program is very similar to the one talked about in 2003, so that estimate of a very high default rate is still important information.

in fact, current loan guarantee program may be worse and some regards than the one look atñr cbo -- guest: kevin -- host: 1 second -- guest: we're talking about 80% coverage. doe recently put the taxpayer further back in line for compensation so corn export banks from france, japan, will be in front of u.s. taxpayers if one of the project defaults in terms of being compensated. in terms of the license solving any of the financial risks, there were dozens, scores of atomic reactors in the 1970's and 1980's that got their license and then the project was cancelled. so this license will not take care of the financial risk. they can still fail after the get license from nrc. in terms of the 1% figure, there has been tremendous obscurity at the department of energy which flies in the face of president obama's call for transparency in government. we cannot look of the

applications. we cannot look at the methodology being used to figure out what the subsidy fee should be, so because there is this figure of 50% default rate and alex says 1%, the other 49% would be covered by taxpayers and we are talking about billions of dollars per reactor. like you said, the republicans are proposing 100 reactors. that also is a contradiction of fiscal conservatism. faugh host: how do you respond to supporters say this is clean energy? çóif you are looking for alternatives, this is the wayñro go? ñiguest: there are carbon dioxie emissions -- uranium mining, processing, enrichment, and waste management for a million years into the future. in terms of clean, there is more than just carbon emissions. there is also radioactivity releases on a routine basis. in vermont right now we are

seeing an atomic reactor leaking tritium into the ground water flowing into the connecticut river and it is not leaking into the ground water is being discharged intentionally with nuclear regulatory commission permission into the connecticut river or the air. tritium is a carcinogen. it causes birth defects, genetic damage, and nuclear power plant inevitably generate it just as they do high-level radioactive waste. host: let us keep the conversation going but involve our viewers. springfield, massachusetts on the republican line. caller: good morning to the host and i thank you for taking my call. to kevin and alex -- you know, i really sat here and i was basically up called at the results of his proposal for this guesstimation ponds i

scheme -- ponzi scheme. .

briscoe in the fall that any future applicant may agree to i simply wanted to use that as a hypothetical. that is in contrast to what kevin had in mind which relates to a program that is not on the books. as to groundwater releases. kevin talked about that as well. the industry prides itself in complying with nrc requirements. the nrc allows certain amounts of tritium to be released from power plants. it has many industrial applications. but what the industry has found these higher levels of notification, they want some confidence in what the negotiators are doing. so we have a program where we any releases of tritium fromre

these pipes. that has led to an increase inc awareness. at the vermont side, we have a situation where tritium was released from an underground pipe. and our g-8 is searching for that site, and there are getting -- in the energy -- the nrg is searching for that site, and they are getting closer. we are not even sure if it has an effect on human behavior. tritium decays very clean and we believe it can be managed safely. guest: the vermont department of public health has said that the tritium has already likely reached the connecticut river

from these weeks. some companies said that there were no underground pipes, and now there is a perjury investigation from the attorney general looking at those false statements under oath to the state. where did this 50% figure come from? it is based on the past record of the u.s. nuclear power industry. 50% of the reactors that were originally ordered were never built. the capital costs are where the financial risk is. alex said there was a low blow to the rate once you have these things, but that is the whole point. they have set a $10 billion price tag for how much it will cost, and in will skyrocket from there. in pennsylvania, is closer to $15 million. >> southern was proposing to

build two new reactors in georgia. , those two reactors, when they go online, will meet the alleges the demands of 1.2 million homes. you cannot get that much of a reliable electricity from windmills or solar cells. those technologies have applications, and you can have some intermittent power on your great, but we need this type of power to keep our power need to going forward. it is impossible to meet that requirement and avoid greenhouse gas emissions unless we put on line these types of facilities. host: here is a piece in "usa today" --

it would cost, in total, about $60 million. you cannot provide that much electricity with all of these other things. compared to the amount that you could provide with nuclear power. guest: there is an excellent book written about this called "carbon free, american free." when it is about 6 cents per kilowatt hour. this is a way to compare apples to oranges. nuclear power is 12 cents or more, going up. wind is going down in price over time. again, the lion's share has gone to atomic power.

wind and solar has been left with the left overs, but when it is very cost competitive, the fastest growing new source of electricity worldwide, and solar is becoming more cost competitive with the clear. energy efficiency is seven times more cost effective dollar per dollar, compared to nuclear power. we had a climate crisis, we have limited time, limited money. energy efficiency is the first thing we need to do. then things like wind and solar, which do not have the risk of radioactive waste for the possibility of chemical releases. host: next phone call. caller: we are at the epicenter of the mountaintop removal, here in west virginia.

we cannot get the laws of the country in forced over here. we are looking at that and top removal of coal which is devastating our area. it has destroyed nearly 2 million acres of forest. the water pollution with the heavy metal is basically making this place uninhabitable. nickel industry does not pay its true price -- the coal industry does not pay its true price either. nuclear will not be the thing to solve this. if we do not ease up on coal production here and stop this mountaintop removal, there will be no appalachia. we agree with kevin -- energy conservation is the key to this thing. electrical generation is not

necessary because demand is way down. host: alex, respond to that. guest: i am sympathetic to his situation where there is an immediate need for electricity. the country gets 50% of its of electricity from coal, 25% from natural gas, and the rest are others. we have to deal with the fundamentals. we will not be able to avoid using coal, going forward. we need to figure out ways to mine the coal without the impacts. we need to figure out how to burn it without the current environmental impacts that we have. we have to be able to build nuclear power plants to provide more of our electricity. we need to expand the solar and

wind portfolio as much as we can. we are going to need more electricity as our economy grows. host: next phone call. james in new york. caller: thank you, c-span. one of the best tv programs. one of your guests said that we needed nuclear power to reduce co2 emissions. no matter what problem america has, we are not getting anything unless big business can control it. if we put all of our money to renewable resources, i am sure we could get more of a percentage of our energy needs from them. co2 emissions. through the ipcc, we are led to

believe that co2 rises and falls, and that regulates our temperature. that is absolutely false. there is a film that talks about this, and the ipcc completely leaves out the sun when it does with climate, and that is ludicrous. the sun goes through warming and cooling cycles. when it does go through a warming cycle, celestial bodies released co2. it is not a pollutant, it is a fertilizing gas that nourishes this planet. when the sun and cool, co2 while bulls are reabsorbed back into the celestial bodies. in prehistoric times, the earth had about 10 times more co2 than we do now.

host: what is your question? caller: why the need for more nuclear power, when if we invested more of that money into renewable resources, we could move forward and have more of our needs met. -- needs met? host: what kind of investment would your group like to see in alternatives. give us a dollar amount. guest: i would talk to talk about the book "carter and free, american free." -- carbon free, american free." the author showed that by the year 2014, the u.s. could phase out nuclear power, fossil fuel, from the electricity and transport sectors.

this could be done affordably for the same amount that we spend in our gdp on importing foreign oil. this is technically feasible, economically affordable. we need to do this to solve the climate crisis. we need to shift our priorities away from these dangers and expensive technologies, like nuclear, like fossil fuels. some of the nuclear energy institute's biggest members, like southern, american electric power, these are some of the biggest coal companies in the industry. they do both, nuclear, col. we need a new direction. to give the obama administration credit, they have talked about renewable efficiency, but if all of this loan guarantee goes to nuclear, then these better ideas of going to fall by the wayside. host: how is nuclear funded?

guest: by private donations from across the country. host: individual donations. any democratic investor, a large donation from individual investors, are they smaller donations? guest: we are a nonpartisan, small group. host: next phone call. republican line. caller: being on the conservative side of the republicans, as a resident of texas, why is nuclear not being put on line, rather than spending billions of dollars for a new company, for a new reactor to go online?

guest: he brings of a good point. there are several reactors around the country that were not completed. we are currently looking at whether or not they should be completed to go online. that is why we have recently gone from 103 reactors to 104 reactors going active. tva has brought a reactor online, at cost, one year ago. that is one of the reasons why we think we can manage new projects, and on cost. host: any idea about jobs, jobs created from this? guest: at the tva site, they had about 200 jobs.

in other reactors, it makes up about 800 jobs. host: next phone call. caller: this is not a question. if we cannot pay our bills and you have people who are jobless and we depend on other countries, what difference does it make if we have a nuclear plant? host: alex flint? guest: i think it is important for the president to link our economy to our future. one of the things we look at in the nuclear industry is, there are 50 reactors under construction around the world. today, a lot of that industry has moved offshore, and there

are projects in japan, korea, great britain, and other places. what the president said correctly yesterday was that if we build more reactors here in the country, we will bring back some jobs. the announcement yesterday was made in maryland because there is a tremendous need for skilled workers over there. the president of shaw was with the president, and he estimates he has about 1500 people working already for southern company. these jobs pay well. host: what is the average hourly wage? guest: in communities where we have plants operating, we pay 40% above the prevailing wage in the communities. guest: one thing i wanted to

mention was southern company and a state of georgia are engaged in a construction work in progress policy. workers in georgia get to pay for the completion of these things, in advance of their completion. no electricity is blowing, so the people of georgia are unwilling purchase appears in this project that never may be completed. in florida, some new reactors were proposed at turkey point. the company was denied by the state from doing a very large rate increase to pay for the construction. also in missouri, where a construction work in progress is illegal, the company tried to override that wall in the state legislature to charge residents from building a french reactor. guest: if i may.

construction work in progress allows utility to pay for their costs as they incur them, so they do not concur financed contras. construction work in progress and loan guarantees actually reduce the rate that their customers will have to pay in the long term. opposition to those programs will actually drive up the costs. host: patrick in grand rapids, michigan. caller: i was watching tv about a week ago and france was talking about a nuclear recovery system. the recycle as much as 96% of their uranium. part of the issue in the u.s. with nuclear energy is what to do with the waste. i have not heard about any type

of recovery system like this. guest: i am glad that question was raised. recently, the nuclear regulatory commission chairman said the idea that france has called its nuclear reactor waste problem is one of the greatest myths out there. the truth is, if they are recycling nuclear waste, that is 1% true, at most. their reactors have fallen apart at tremendous expense to taxpayers, and it has created a real environmental disaster. there is an underwater pipeline where plutonium is extracted from based. this would be illegal if the french were dumping waste from ships and the barrels, but they found a loophole of an underwater pipeline where the discharge as much as 100 million gallons of waste.

other european countries are abridged, calling for this practice to stop. we stopped reprocessing under the ford administration because it is such a nuclear weapons proliferation nightmare. india just used the u.s. reprocessing policy to explode their first nuclear weapon. the ford administration's response was to prohibit reprocessing. so between the expense for taxpayers, because that is who would pay for this, the environmental devastation and public health consequences and worker health consequences, nuclear proliferation, this is a nonstarter as a waste solution. host: next phone call from california. caller: let me tell you about windmills. we have windmills all over california, and they have been

shut down for four years because they disturb the flight pattern of some birds. host: do you want to respond to what kevin said before? guest: i feel like i am arguing with someone who believes we cannot put men on the moon. france had demonstrated weekend -- weekend rely primarily on nuclear -- we can rely primarily on nuclear. navy use the plutonium in their reactors. there is a wonderful demonstration that this can be done. the argument that the united states somehow does not have the technical engineering wherewithal is disingenuous. the u.s. develop a lot of the

technologies. we have the ability to do better and advanced technologies that but france has done. host: here is a tweet from one of our viewers. guest: it reduces the cost of borrowing. that makes it easier to go to banks to reduce the charges and have on the debt. what southern is doing is the judiciously going through every aspect of the nuclear power plant and reducing the cost and risk. this is part of their risk mitigation strategy. host: kevin kamps says beyond nuclear, in the senate, there is a $18 billion already available, but in the 2010

budget, the president asks for -- he wants to triple that. where are the votes in the senate? guest: that remains to be seen. along with the environmental movement of the country, we are going to activate and let members of the house and senate know this is a bad idea. we are going to fight this to prevent this massive increase in subsidies to nuclear power industry. host: do you have an idea of where the votes are? guest: i think the votes are there. this opportunity to build more than a few plants and to regenerate and industry, which will add jobs, i think that idea is becoming clearer. certainly, a team in the president's comments yesterday -- interest in creating those jobs rather than having import components, will result in support for the president's initiative.

guest: could i comment on why there are changes like that in the congress? an investigative working shop pointed to an article that said the nuclear industry has spent $645 million lobbying congress in the past years. in the last decade, $63 million in campaign contributions. this is an incredible figure. this is a very powerful industry politically. they throw their weight around and they make progress on the hill. we have members across the country that have to deal with the radiological and financial risks of this industry, so we are going to do what we can to bring some democracy back to this process. guest: do you think the president's statement yesterday was the result of any pressure along those lines? guest: he is trying to win republican support on the climate bill. we also think some of his senior

advisers, who have ties to the power industry, are giving him bad information. rahm emanuel it is tied to exl celon. this is undue influence from the industry. host: a couple more phone calls. first, a story from the "wall street journal" -- pittsburg. pat on the democrat line.

caller: for the last few months i have been fighting with our government in pennsylvania about flagging. it is a very dangerous way to dig for gas. one house blowup in ohio -- blew up in ohio and fire came out of their water faucet. nuclear energy cannot be disposed of safely. when i heard kevin -- the one on the right -- talking about the french problem, did they have some sort of plastic to try to put the waste in and it melted?

guest: in france, with this reprocessing technology, they are left with a liquid highly radioactive waste. they lack geological disposal sites. the waste is piling up in france, as it is here. in this country, it is stored in pools of water which are now full, and the overflow is going out into the silos. the nuclear regulatory commission has a report from 2001, that if one of these pools loses its cooling water supply, the radioactive the inferno that when results could kill 25,000 people downwind from a fatal cancer. we have these tremendous security risks associated with nuclear waste.

we are calling for a cessation of the generation of this deadly material. we need to stop making it. what already exists, we need to fortify it against attacks, safeguard it against accidents, and prevent any leakages. guest: that is irresponsible fear mongering. the u.s. had responsibly used fuel for research reactors as well as naval reactors. it is safe, it is secure. we transport used fuel regularly around the world. we have a disposals o facility o get rid of waste. it gets rid of it 2,000 feet below ground. the only thing we lack with the program is political support. it is not a scientific or

engineering challenge. we have the ability to manage used fuel. we do it every day in the industry. we stand by that record. it is not a scientific or engineering challenge. it is a political challenge, and your fear mongering is the reason why it is there. host: thank you both for being here. we appreciate it. i want to show you one last thing on this debate. thomas friedman writes in the "new york times" suggestions for those who are concerned about the climate change debate. he is saying that the climate change community should produce a simple 50-page report and call it what we know, summarizing everything that we know about climate change, with language that a sixth grader could

understand, with peer-review footnotes. we will be right back with michael from "newsweek" to talk about taliban's number two being captured. first, an update from c-span radio. >> president obama makes remarks on the recovery act on this first anniversary of the signing of the economic stimulus bill. live coverage of those remarks. then the president meets with his national security team on afghanistan and pakistan. secretary of state clinton has returned from her trip abroad where the iranian supreme leader accused her of spreading lies against iran during her recent tour of arab states. the ayatollah khamenei claims the u.s. want to frighten arab states in order to sell them expensive weapons systems. secretary clinton told an audience in saudi arabia on tuesday that it is the responsibility of their

neighbors to ensure it does not get nuclear-weapons. william burns, undersecretary of state, is meeting with syrian president today as part of the president attempted to improve ties with the country. he is the highest-ranking official to visit since the january 2005. and french president nicolas sarkozy has landed in haiti. it is the first visit ever by a french president to the former french colony. he was greeted by the haitian president. those are some of the latest headlines. >> president obama is expected to talk about the economy and jobs this morning as he makes remarks on the one-year anniversary of the signing of the stimulus legislation. that will be at 10:25 eastern. then at noon, a look at the 2011 budget for the national oceanic

and at best -- atmosphere association. and a tribute to the tuskegee airmen. >> with your mouth -- what is the imagination, you could not have made this up. >> clinton versus starr. ken gormley on "afterwords." host: with me now is a guest from "newsweek." guest: the number to taliban in

afghanistan, essentially, the national commander. anyway, he was captured in pakistan in a joint operation by u.s. intelligence and pakistani security forces last week. "new york times" broke the story the other day. this was a major coup for the u.s. and pakistanis. he is the biggest catch we have had in quite a few years and he is now being interrogated by the pakistanis, with the assistance of the americans. presumably, we can expect the united states and the afghan government and pakistanis will learn a lot about the inner workings of the taliban. host: there is quotations in the paper saying that he is providing useful information.

do we know what that is, will we ever? guest: not in detail. it is always hard to tell in these situations how much they are cooperating. there are lots of theories about how this came about, what the various agendas are, particularly of the pakistanis. there has been a tremendous back and forth about how much the pakistanis have been helping or not been helping in that effort in afghanistan. of course, the pakistani intelligence forces have longstanding ties to many members of the afghan taliban. so is it is hard to know exactly whether this presage is a turning point in pakistani cooperation. certainly, the taliban in pakistan have been quite burgle,

as a threat to the pakistani government -- a brutal -- brutal, as a threat to the pakistani government. host: how did it, about that he was captured? do we know the back story? guest: we do not. i have spoken to some sources who think there could be more to this than meets the eye. baradar had been someone that the pakistani government has been cultivating. they come from the same family tried. there had been talk about reconciliation between the afghan government and members of the taliban. could we -co-op them -- co-op

them and bring them into the tent? it has been suggested, although there is no hard evidence of this -- and baradar was considered someone who might be open to some sort of negotiations with the karzai government, another might be a way to bring him, if not under the tent, then to neutralize him in a way to allow some sort of peaceful resolution in afghanistan. if he was open to that, would he have agreed to be captured, rather than turning himself in? that is not something he could have done politically. i only put that out there as the kind of conspiracy theory that

you are hearing from some very knowledgeable people. there is a lot that we do not know about this. there is often times a lot more behind the scenes and we see publicly. host: this is possibly a public relations strategy from pakistan and the u.s. government? guest: i should point out, there is another set of conspiracy theories, which comes at a useful time to the obama administration, who has been under attack from his republican critics for not prosecuting as vigorously the war on terror. for treating it as a police matter rather than the military conflict that it is in afghanistan. to be able to produce a big intelligence coup like this at a time when it is under attack is extraordinarily helpful to officials in the white house. host: we are speaking to an investigative correspondent with

"newsweek." republicans, 202-737-0001. democrats, 202-737-0002. independents, 202-628-0205. also a reminder, send us your tweets at twitter. you may also e-mail us. we are talking about the impact of taliban commanders capture in afghanistan. the number two was captured last week. we are talking about what sort of information we are getting from him and what was involved in his capture. this headline from the "baltimore sun" -- what do you make of that? guest: well, luck is always a factor in these things. i do not think we have a definitive account yet.

i should point out, there are so many interesting dynamics to this story. one of the things that we focused on in our the classified blog classifieddeclassified -- declassified blog about how this is going to develop. one interesting thing that has developed it iis another guy whs the operational commander in helmand province the in afghanistan, -- province in afghanistan, which has been a fortress for them. he is a former guantanamo detainee. he was captured after the u.s.

invasion in 2001, held for six years, sent to guantanamo, and then he was released by the bush administration at the end of 2007, among nine other afghan detainee's, at a time when the bush administration was trying to reduce the population in guantanamo. he was sent back to afghanistan, to those to be kept under custody in a prison, but under somewhat murky circumstances, was freed by the karzai government in the spring of 2008. before anyone noticed, returned to the battlefield, fighting for the taliban, was the mastermind behind a string of roadside bombings that have killed scores of allied troops in helmand province. he very well might emerge as the replacement for mullah baradar.

there are a number of contenders, but he is pretty high up. think about this political implications of that. clearly, this counter is a coup for the obama administration, but the idea that a guantanamo detainee returns to the battlefield and will not be the operational leader of the afghan taliban create quite a few problems for the obama white house and its efforts to close guantanamo. it will remind people of the risks that can take place when you left some of the detainees free. on the other hand, republican critics are going to want to make too much of this because they are going to have to answer the question, why did the bush administration let him go? it was not the obama administration. it was the bush administration who let him go. host: when you talk about

guantanamo, where will baradar go? guest: good question. in the past, he may have gone to guantanamo. clearly, the obama administration does not want to do that. since we have closed -- president obama has closed all of the cia black presence abroad, there are not all of option where we can take them. that could be one reason when you ask, when you read the reports, it is the pakistanis who are in control over baradar, not the u.s.. it may be because u.s. intelligence, at this point, does not know what to do with him. host: we are talking about the capture of the taliban number two. first phone call from new orleans. caller: there is a difference

between a conspiracy theory and a conspiracy fact. a theory is only a theory until facts, not to support the conspiracy. that is what we have here. what i am about to bring up is fact. what are we doing fighting that, then? who attacked us? it was certainly not the taliban. -- what are we doing fighting the taliban? they came out after 9/11 and said, you supplied the evidence that usama bin laden was behind the attacks, and we will turn him over. to this day, the fbi does not have usama bin laden on their list of most wanted criminals. they say they do not have the evidence.

so what are we doing there, who are we fighting? host: go ahead and finish. caller: who attacked us? thank you for interrupting me. guest: i realize you get all sorts of phone calls, but the idea and that usama bin laden was not behind the 9/11 attacks -- it is a shame that that kind of thing gets out there. no doubt, there is no doubt about who was behind the attacks. he has claimed credit, even as recently as a few weeks ago. this is not even worth discussing.

host: does the question of where your usama bin laden is, does that question still come up? guest: it is a very good question, but the problem is, when you come to american officials about this, if you really push them hard, the answer is they have no idea. they believe he has been hiding out along the afghan-pakistani border, likely on the pakistani side. he was last known to be fleeing to for bora. -- tora bora. he is still producing these tapes, he is still active. he is likely where the u.s. government thinks he is, but the fact that there is no confirmed

intelligence about his whereabouts is a pretty disturbing fact. host: miami, ron, democrat line. caller: i have a problem with a certain whether we get the usama bin laden or the taliban or whatever, that is not the issue. the issue is what causes terrorism. as long as all the media is controlled by the propaganda, we are not going to get to the source, which is way israel is treating the palestinians. there will always be terrorism as long as we allow the destruction of palestine. host: the connection. it is a point that is brought up continuously by some people. guest: the israeli-palestinian dispute is a factor.

it is hardly the only one. if you look at the usama bin laden's agenda when he declared war against the united states, it was not one or two items that he cited. leaders occasionally envoke it because they know it plays well in certain parts of the arab world. but the idea that al-qaeda and terrorism is solely about the israeli-palestinian dispute is nonsense. host: on the capture of the taliban number two, on the cover of "the washington post" -- is this the beginning of a trend that the obama administration is on better footing now?

guest: it certainly helps. we did not even mention the military operation going on now in helmand province to flush out the taliban. you see the makings of the strategies, the pakistanis getting more aggressive and helpful as you have this military operation going on. it is ultimately -- the test will be after the troops leave, general mcchrystal said that they were going to bring a government in a box to replace it -- that is the key. can you form government on the local level that produces allegiance to the afghan people and keeps them away from that, then? that we do not know. host: sheila on the republican line. caller: i appreciate what the

former two people said. i really wish the media would stop telling us lies. republicans are not convincing because they are too busy not understanding. they are too nervous and uncomfortable. host: why do you believe and that reporters, the media -- called coke because it makes news. it is repetitive -- caller: because it makes news. it is repetitive. it is bad. we should not be supporting

something that is false. host: thank you. anthony on the pending land -- independent line. conn. caller: i disagree with everyone who has called in. ever since the obama administration took over, all these critics -- the christmas day bomber, right away they jumped on that. yesterday, you had someone from the hoover institute who said this number two taliban man was captured in pakistan and the u.s. government does not know anything about him. he did not say anything about cia being there. that was all over the newspapers yesterday, that the cia was there with the pakistani intelligence service. i am a veteran. i am upset about the politics,

-- the protection of our nation -- in respect to both parties. what we need to worry about is security of the nation. your guest yesterday totally denied everything that president obama is trying to do. host: he is referring to marc thiessen. guest: a former president bush speech writer. he has been up there suggesting some pretty strident suggestions that obama had been compromising national security because he is not following the bush administration policies. of course, if anybody watched the interview with vice president cheney over the weekend, he was clear that by the time bush's second term came in, which marc contributed to,

those things were no longer being accepted. basically, a second term bush had been attrition policies are fairly close, if not identical, to the policies of the first obama administration. there is an enormous amount of continuity, and the people who suggest there has been some radical change under president obama are just not familiar with what is really going on. host: we want to point our viewers to another story that you wrote over the weekend. it is about the blog that michael rights. u.s. intelligence prefer in the persian gulf. it turned out that u.s. intelligence may have found on numbers, photographs, etc. linking al qaeda leaders in pakistan with individuals in the yemen. guest: everyone has been focused

on this baradar capture, but what we wrote about may prove to be asked to commit against -- as significant. in january, and al qaeda courier was arrested in the persian golf on his way from pakistan to yemen. there was no public announcement of this, but within a couple of days, on an islamic jihad website used by al qaeda, there were some pretty high-grabbing postings alerting commanders in afghanistan that this guy had been captured. he had with him 300 telephone numbers, pictures, and important documents. these people on this web posting were alerting their commanders

to take immediate precautions to avoid being compromised. we checked this out with u.s. intelligence and confirmed that such an individual had been captured, he did have important, useful information on him, and if it is anything like what was described from the publishing, then it could be a remarkable coup for u.s. intelligence about al qaeda's command structure, in both pakistan and yemen. although, the bad news there is the idea that there was this kind of direct communication flow between al qaeda core leadership in pakistan and in yemen. that is pretty disturbing, when after the christmas day bombing, and the white house gave its review, john brennan gave his briefing. he was asked, what is the most stunning thing they discovered?

that al qaeda in the arabian peninsula -- in yemen -- is a direct outgrowth and working with core leadership. until six weeks ago or so, the white house, intelligence community, did not understand how close those legs were. the conventional view was that al qaeda in the arabian peninsula was a franchise, in alignment, but not necessarily working together. this seems to establish that there is a much closer relationship than what was understood by the government until recently. host: what does that mean for diplomatic efforts that president obama has tried to initiate with countries like yemen? guest: what is happening here is more than a diplomatic effort. there are drone attacks, military operations. it is very much a military conflict as much as afghanistan.

host: ohio. doors on the democrat line. caller: -- doris on the democratic line. caller: when we were first attacked, they were looking for your usama bin laden in the mountains of pakistan -- for the usama bin laden in the mountains of pakistan. he was on dialysis. how long can cope -- someone for survive on that? i am a democrat, i am, of it. -- i am proud of it. there was an expert on fox news -- he was a campaign manager for

sarah palin in hawaii. geraldo asked him the question, what is the tea party, where is sarah palin? is she with the tea party, if she independent? host: i am going to leave it there. guest: the dialysis rumors. they are rumors, and it has never been confirmed. as i pointed out before, there is no confirmed intelligence about his whereabouts, much less his medical conditions. i have heard these things about dialysis. i have never seen its solid the confirmed as to whether or not that was a problem he was facing. host: cincinnati, ohio. scott on the independent line. caller: please do not cut me off. what is the end game for all of

this? are we to militarize the entire world? you had an article about alex jones. i know she is a bit off the wall, but on will never understand how building seven came down. did you do any reporting on building seven? host: we are going to leave it there. guest: i think this is a reference to some of the conspiracy theories that still surround 9/11. they have been as thoroughly investigated as anything could. what everyone saw happen on tv is exactly what happened. two airplanes in the buildings and destroyed them. host: his first comments about the end game? guest: that is a question that

has hung over our conflict with al qaeda ever since it began. how long is this going to last, how will we know it is over? can we truly eliminate an ideological virus that continues to percolate in the muslim world? there are no good answers for that. but when you have people with weapons, determined to attack and kill americans, it is incumbent upon any american government to do what it can to defeat that threat. host: west palm beach. debbie on the republican line. . .

and i think the americans are just tired of it. we cannot afford it. and with the economic situation here, we cannot even afford this and more. host: any thoughts? guest: the caller mentioned iraq, which has taken a backseat with all of the attention in afghanistan. i think president biden -- vice- president biden said iraq was going to be one of the success stories. we will see. troops are supposed to be withdrawn this year. at best, officials are cautiously optimistic. but whether or not the iraqi

government is going to be able to provide the kind of stability and security for its people and have a stable government is, you know, is something we do not know the answer to yet. host: birmingham, alabama, gwenn on the democratic line, go ahead. caller: good morning, i always like your unbiased opinions, mr. isikoff. i think this is great impact, the capture of the second in command of the taliban. it gives me some hope. andñi i agree with president obama, with them catching the second in command of the çótaliban, -- i'm sorry, i alwas go back to this -- we will be

further ahead in the war with afghanistan than we are now. we took our eye off the ball and that is why we are struggling. host: any indication that pakistan will continue to work with the united states on this? guest: that is certainly the hope of the u.s. officials. the baradar capture seems to be a pretty good example of that. could there are some instances where you get progress on this front and then you get setbacks and a pakistanis referred to past behavior. host: next phone call from north carolina, william, go ahead. caller: i was just looking for some historical perspective here. going back to the gulf war in

1989, we kind of took a stop point and then we go forward to 2000 and we have the taliban the way it is today. i do not understand how we cannot trace these people. if they truly do have a second in command, and usually do have a list, then it should not take so much. guest:s the: have baradar -- the pakistanis have baradar. we, too, have to ask for permission. it is useful at times like this -- these guys, the taliban, al qaeda are pretty resourceful, an

intelligent on their own. they know how to take operational steps to protect themselves. they are enormously innovative and adoptive and they have managed to survive despite a rather determined to american allied campaign against them for many years. as an enemy, they are more formidable than you might imagine. these are not -- i will just leave it at that. they have proven themselves to be a formidable enemy. host: richard in new york, good morning. caller: i saw the tower's fault 45 minutes after their reports that they were hit.

i watch these reports, too. this things to high heaven like an inside job, but i appreciate it. host: moving on to marvin in detroit. caller: i have been watching between vice president biden and vice president cheney talking about people who were prosecuted in federal courtç do you have a rough tally of those who were prosecuted by the government? guest: i think the figures are some 300 were prosecuted for terrorism by the justice department since 9/11. not all of those were serious international terrorism cases. most of them were not, but a lot of them work. and the taliban commission is three.

two of those, a guided by the name of david hicks, and, don -- hamdan, who was the first, osama bin laden's driver, are free people. david hicks is back in yemen and his wife has just given birth to a baby boy and he is a proud father. this is a guy that the bush administration spent years trying to prosecute for war crimes before military commissions. host: what is he doing? guest: he is trying toñi find wk as a driver. he is having trouble finding steady employment because tourism is not what it used to be in yemen. a journalist came to the capital not long ago and he had covered his face and he had managed to get a job driving her around

yemen. it is an interesting postscript on what was an enormous legal battle that what all the way to the supreme court in the bush years. the guy is now free man. people think that military commissions would be so -- a far tougher than civilian courts. look of a trucker occurred today and see to out of three of the guys are free -- look at the track record today and see that that two out of the three guys are free. host: we've seen as president biden respond to the previous vice-president repeatedly. but we have not seen the president respond to buy as president cheney, or maybe we just have not seen as much. is there a -- respond to vice president cheney, or maybe we just have not seen as much. is there a calculated response there? guest: vice-president cheney has been speaking out about a lot of

things that people in the white house and the media think are outrageous and counterfactual. but the broader version -- the broad issues raised about the more vigorous stance in the war on terror has clearly resonated. the obama white house has checked in congress in its efforts to close guantanamo, has -- of the trial in new york for khalid shaikh mohammed has been thrown into doubt. this remains a very much hot- button political issue that the white house is worried about. whether it is a national security issue more broadly -- and that is one reason i think you have seen them so forceful in recent weeks on this. host: on the possible terror trial in new york guest:, any

update no, but there -- in new york, any update? guest: no, but they will have to make a decision soon. mayor bloomberg and senator schumer have said that nowhere in york say they think that the trial could take place. -- in new york say they think the drought could take place. that is pretty tough. -- the trial could take place. that is pretty tough. they do not have a lot of good options. it would like to have it in one of those jurisdictions, but perhaps on a military base. some people say fueled a civilian trial on a military base, what is the point? this one is very much up in the air. host: michael isikoff's blog on the newsweek website is called "the classified."

and how many times a week are you posting? guest: sometimes several times a week and sometimes several times a day. host: is it intelligence based? guest: largely investigated issues. my colleagues and i have investigative stories and reposed them on the blog. host: next caller from michigan. caller: i just want to let you know that just because "newsweek" does not have certain information does not make it wrong. the four example, i do have information that osama bin laden was dead. he was killed one year before the 9/11 attacks. host: where you get that information?

caller: hold on. i have been investigating this terrorism problem for 20 years and i never heard of the al qaeda problem until after the 9/11 attacks. i had a group of people investigate this and there is evidence that the seventh tower imploded. the wealthy elitists have overtaken the united states federal government and are using terrorism to make a lot of money. host: we will leave it there. if we have already addressed that. orlando, fla., democratic line, go ahead. caller: i was very suspicious when our forces and cia supposedly allowed bin laden to escape. i am not a conspiracy theorist, but i believe that osama bin laden is dead. i believe it benefits the military-industrial complex to keep him alive to have an excuse

to have continued wars in the middle east. host: do you have any thoughts on that? guest: know. -- no. host: what is next for you after the capture of this leader in the taliban? guest: the political indications are going to be very much front and center in congress very shortly. there is an intelligence authorization bill coming up in the house i believe in the next week or so. isn amendment by peter king on the republican side to cut off funding for the khalid shaikh mohammed trial. that will be a test whether the push back by the administration showing its successes has gained any latitude on that. the we will be watching it closely. host: and what about democratic senators?

ñihave your word any reaction fm this news that they will rally behind president? guest: on the senate side, linda grant says he is going to attach an amendment to do the same thing to the next vehicle you can find in the senate. he was hopeful as of a couple of weeksxd ago that he had enough votes now to prevail. if either peter king or linda gramm prevail, that would be a pretty crushing defeat for the obama white house and a rebuke to them. i do not know if they have the votes right now. i think is going to be very close and something to watch in the next couple of weeks. host: michael isikoff with "newsweek" we appreciate it very much. up next, a name that are consistent c-span viewers will know. he is a senior fellow and has

been testifying on capitol hill as of late about the economy deficits, etcetera. we will talk to simon johnson next. >> the commerce department reports that construction of new homes and apartments rose more than expected in january, pushing activity to the highest level in six months. the gain is raising hopes that the construction industry is beginning to rebound from its worst slump in decades. vice-president joe biden speaking earlier on cbs says washington right now is broken and the country is in deep trouble on -- unless it attacked the learning deficits. he added he has never seen it this dysfunctional. more on auto maker toyota today. the company's president says he will leave it to u.s.-based executives to testify before a congressional hearing to talk about safety recalls.

he said he will consider appearing at the hearings if summoned. meanwhile, toyota is considering another recall. this one, it's an coro sublla compact -- corolla subcompact. there are restrictions designed to stop terrorists in somalia from diverting aid, and they're actually skirting operations there. the future for many somalis look pretty bleak. those are some headlines on c- span radio. >> president obama this morning is expected to talk about the u.s. economy and jobs as he makes remarks on the one-year anniversary of the stimulus and -- stimulus legislation. at noon, the 2011 budget for the oceanic and atmospheric administration. that is live on c-span2.

and this evening, and archived salute to the tuskegee airmen. that will be live here on c-span at 7:00 p.m. eastern. >> our companies, whether it is providers of videos or those who invest to create the content, are working overtime to get consumers all that they want on every platform or a device they own as quickly as possible. >> this weekend, head of the national cable and telecommunications association on what is next with the cable industry. >> "washington journal" continues. host: simon johnson is joining us this morning from the peterson institute here in washington d.c. mr. johnson, we asked our viewers earlier today to grade the stimulus one year later. what grade would you give it? guest: i think just looking at the stimulus itself, i would

give it a b plus or a in a-, actually. the outcomes without the stimulus would have been much worse in the last year. it was quite important from -- for preventing confidence from collapsing both in the united states and internationally. i think there are other things that obama has done, but on the qjáu$e right thing. host: do you have concerns with the stimulus? guest: yes, of course, we all wish that more of that money had been spent sooner. i think more of it should have gone out in the form of tax cuts, which would have helped consumers balance sheets to lower debt. that is a pretty fair and -- would have been a fair and sensible way to handle a situation. but this is just personal quibbles. broadly speaking, the stimulus was at the right thing to do.

host: president will speak marking the one-year anniversary later this morning. it will be available on c-span television as well as radio. there are a first towards a jobs bill. they do not want to call it a second stimulus bill. harry reid has can -- has indicated that it will be smaller jobs legislation moving through the senate. your thoughts on what they are talking about there? guest: i think it will probably address the payroll tax, perhaps for smaller businesses, perhaps on a temporary basis. it will not be a lot of money, though. that is, of course, because we have such a large deficit. our debt is increasing not to levels that you would usually worry, an introductory is not good. it is also this breakdown of --

and its trajectory is not good. it is also this breakdown of working together. is the five-to-10 year horizon that is quite concerned. that removes, i think, a lot of our ability to provide for the stimulus or support the economy, to use a less controversial term, now and that is most unfortunate. host host: president obama is expected to announce this week a debt commission to look into medicare spending and social security spending. what are your thoughts on a debt commission by executive order and the job they have to tackle? guest: i think having a bipartisan commission is quite important and i do hope both parties are going to cooperate with this. there was an attempt to have that commission come out of congress, but that was stalled. i think the court -- the republicans did not want to

cooperate. the key issue, medicare is the key item going forward. i'm talking 10 to 20 years down the road. security is a bit of an issue. but you also have to look at the taxation side. we do not have a very good tax system. it is not easy to scale it up. if the decision is that we need the federal government to generate a higher percentage of gdp in revenue in order to balance the medicare spending, for example, down the road, then we do not want to do it with the -- this tax system. it is not a panic. we are not under enormous pressure right now, but something has to happen over the next decade. if we can get on a path to get us there, that will put us with more roma a a to maneuver in the economy today. -- with more room to maneuver in

the economy today. host: you are perfect -- uri professor at mit and you also write a blog. it is entitled "baseline scenario." you have written a lot about the phrase too big to fail and what the obama administration is thinking about when it comes to that. how can this administration shrink the financial sector that exists today? guest: it is not that difficult. you have on the books the banking act of 1994. this actually caps the size of the largest banks in this country relative to their share of total retail deposits. no single bank can have more than 10% retail deposits. that was a fine line, but since then we've had bigger banks from holes of funding, not retell

funding. the cap needs to be -- from wholesale funding, not retail funding. the cat needs to be amended. -- the cap needs to be amended. it could be a substantial size reduction for our largest six banks. it would not affect anyone other than the largest six banks. and most people that i talked to that do not work for the largest six banks are rather in favor of the cap. you need a new approach to regulation -- regulation and not just rolling over. host: have talked about this on your blog as well, that is not just populace out there against wall street. there are those on wall street that support bringing in those big firms. there is an article this morning that favors reading in these

four guys. -- raining in these four guys. guest: absolutely, and there's been talk of this for some time. i am not anti-finance. i was a chief economist at the imf. you do not get that job if you are a populist, i can assure you. the view of these largest banks and constraint is not pitchforks. that is the reasonable technocratic view. that is the view of most of the financial sector. apart from the people in power and apart from the people that run theçó largest six banks. i understand that the people in power are the -- and the peoplei who run the six banks have a lot of cards right now, but things are or to change.

it will not happen in this cycle of reforms, but over the next three to five or maybe 10 years. host: what about those complicated transactions that we heard about? the credit defaults swaps, those sort of things. is anyone in the obama administration and congress talking about getting at what has been called the shot a banking system? it means guest: different things to different people. let me deal specifically with credit default swaps and over- the-counter derivatives transactions. the answer to your question is, i]no, there is nothing currently yuñw3 there is nothing currently administration are likely to make it through congress that will substantially assisted -- restrain. if you go back to 1988 and the impact that long-term capital management could have had, that was very much about the murkiness of these over-the-

counter derivatives markets. this is a huge problem that has to be addressed. there are many fears in europe around greece and their debt and if there is a potential defaults, it could affect europe and even us. those fears run through this opaque market because nobody knows who knows how much to home. -- who knows how much to whom. host: how much could this impact the united states? guest: that is the problem, we do not know. the big banks, i think, also do not know. host: what is the potential? guest: i do not want to scare people. this is just a potential, ok? çóif the greek government defaus or moves close to defaulting, you will see a lot of selling pressure on the part of the portuguese government and the u.k. government has often been in the line of fire.

that will affect us on our exports. the euro will also likely we can -- likely weaken. but the real damage could be to the financial sector. european banks or u.s. banks that do a lotñi of business in europe, that could come back and hurt us. the strategy of this administration wasñi more lust o let the banks off the hook after the 2008 debacle. without a lot ofçó capital, what are the banks going to do? they will cut back on lending. strategy. it will cut back on credit. they're also being hit by real estate fears in this country. we could be headed for a second slowdown in the second half of 2010. ñr

holland, mich. -- host: holland, mich., floyd, go ahead. caller: i am among those americans who like toñi declare, thank god for c-span. ñri would like to suggest that w is the time for a constitutional convention. and in host: thoughts on that? -- host: any thoughts on that? guest: that question is way above my pay grade. i may use -- u.s. citizen. i took the test for being a u.s. and. i like the constitution. what comes out of this process is something sensible. we have faced this before.

we faced this in the 1930's. teddy roosevelt faced a version of itçó in the early 1900's. andrew jackson faced executives in the 1830's. the u.s. always springs back. i'm pretty confident that will happen again. ñihost: springfield, go ahead. caller: do you teach at m.i.t.? and i wanted to ask one more question. guest: yes. host: i hope that professor chauncey could be on c-span at some point, too. my other question is that germany exports to the united states. they have 70 million people and we have 300 million people but they export more than we do. guest: they have 80 million people now. but they are ian export powerhouse.

exporting is fine, but if you export a lotñr more than we import, than the present imbalance. -- that creates an imbalance. as much as i admire german ñrachievement, you have to keepi things in balance. çóa very tight fiscal policy is not the best policy for their neighbors. in europe is grappling with the issue over how much the big countries, germany and france, should do for themselves or how much they should integrate into an economy where you share the responsibilities and policies and you try to bring everyone with youçó, or less like we do n the united states. host: there isñi an article in the open group financial times at" this morning.

let increase out of the eurozone and then lettingñr them back int a competitive rate. guest: i think this particular piece just shows you the difficulties that europe is in. there's no mechanism to leave the eurozone. if there were to adopt this proposal, which is to take back then go back to it a year later, i think it would be complete chaos. ñiif that option is really off e table, then we are looking at a big fiscal adjustment by greece, perhaps a 10 percentage point reduction in spending or an increase in taxation. and some external financial support from the european union. and the other a solution, and afraid at this point, is going to read to problems for the rest of europe -- going to lead to problems for the rest of europe. host: james in north carolina.

caller:ñi we have talked of stimulus and jobs. on abc a weekñi ago, $457 millin was given for a wind farm in texas. 300 construction jobs were going to be obtained in the united states, 2000 manufacturing jobs in china for blades that we can manufacture in the states. this is crazy. there are no constraints or control tuesday that this money, 70% to 80% must be spent in the state. what is the benefit to was as a country? guest: i think that is an important pointñi about china. the unfortunate fact is that china is its -- is cheating on its exchange rates. they maintain their currency as undervalued for a long time,

using mechanisms that are not allowed in the international economy. unfortunately, the job of enforcing those mechanisms falls to the imf and it has completely dropped the ball on this issue. the u.s. treasury could take this up and label china its currency manipulator. i think we will not because we wrote -- we rely on china to buy so much of our debt. this is a major weakness of the united states. we have to look for new multilateral ways forward. china has to stop manipulating its exchange rate in this unfair manner. host: simon johnson let me show you the headline on the front page of the "financial times" this morning. it's as treasury bonds fell by a record amount in december as china purged its holdings of

government debt. what is behind this? guest: china is looking for other options. i would point out, though, there are not a lot of good options. the prospects for the euro, given what we are seeing increased and their ability to resolve those problems are not strong. i think the foreigners will continue to buy u.s. assets, primarily china and central banks, they will be buying u.s. securities. that is a good thing, but in the long run it creates a major weakness for us. if we have a strategy to bring our debt under control, then i would not worry too much. but if our fiscal policies are off track. if we do not have a way toward a reduction in our deficit and limiting the amount of debt that we put out there, then we will have a big problem.

china will be just one part of the problem. the biggest part of the problem is our own overspending anna a reluctance to raise taxes a berber the and curb spending in a way that we can agree upon. host: how much new taxes need to be raised? guest: that is a good question and it depends on how and you want to take. over the next 10, 20 years kamal lot of that depend on medicaid. -- over the next 20 -- 10 to 20 years, a lot of that depend on medicaid. we can show what will happen to our medicare spending based on demographics as people get older. çóalso the cost of medicare givn the technological changes that we see there. hese numbers are scary,o question about it. it does not mean you have to cut

spending. i think some people say that. it is not actually what is in the numbers. i think you have to limit it cannot continue toñr increase so much faster than the economy grows. when we do that, we also have to take the view on how much tax revenue we were -- we need. the conversation has to be about both. host: franklin, tenn., good morning. caller: have two comments. the first is on the previous segment. if you had asked about -- he let out a caller about where they had that information about osama bin laden being killed. it wasñr benazir bhutto in two youtube videos. it was cut and after it specifically states that he died inñi the battle of bora bora a n

the 2001. i thought i would just clear it up. and my question is, why can't we tie co banker bonuses to return to a viable implement rate? -- employment rate? these bankers have really gone awry with their risky ventures and they have allowed our economy to be destroyed, and not just for this year but for many years to come. why aren't we trto find that toa returnable employment rate? we definitely should not be tying it to stop. host: professor john syndex guest: -- prof. johnson? guest: that is a great question. i think the broader point here

is that the financial sector -- and the caller is right -- has gone massively are right. this started essentially with the reagan revolution in the 19 eighties, deregulation that were -- in the 1980's, deregulation that was a brief for the airlines. this became worse under the clinton administration. there was a lot of deregulation pushed by the u.s. treasury. it also became worse during the george of the bush administration -- the george w. bush administration. a philosophy really represented by alan greenspan, who said just to let the markets go and get out of the way. the underlying problem is much bigger than the bonuses. the underlying problem is the structure of our financial

system, the fact that these banks get bailed out when they fail, and they are right based on recent evidence. i write about this on our blog and also face to face we testified to the senate banking committee about 10 days ago with rep -- with a representative of goldman sachs on my right and a couple of chairs down was the ceo oven jpmorgan jays. their powerful politically. -- they are powerful politically. this situation will only change when mainstream opinion, or the conventional view of banking changes and we begin to realize that this kind of aggressive -- reckless risk-taking is very dangerous to society and brings nothing to the table in terms of benefit society and brings times of high unemployment. host: which agency of this

government could effectively shrink the financial sector when these are not just u.s. companies? they are global companies. guest: what other people do in their own countries is up to them. honestly, the u.s. is the center of the world financial system. we can sort our own problems are. we can bring other people with us, that is fine. but there is no reason to wait for the europeans. and the agency question is a good one. i am open to all kinds of possibilities and suggestions. the federal reserve is the regulator and the supervisor of all the big holding companies. i'm not expecting the federal reserve to take the lead on this. citing mr. bernanke does not want to step up and -- i think mr. bernanke, unfortunately, does not want to step up and take responsibility. i think the administration put a

good deal of capital to work to make sure that he stayed on as chairman of the fed. but honestly, it would require presidential leadership at this point. we see encouraging signs, but also discouraging signs. the president said nice things about big bankers and their compensation just last week. you have to ask the white house where we are on this issue. host: simon johnson is the author of an upcoming book, "13 bankers." when will this come out? guest: when wilthe end of march. i do not think this problem is going to go away anytime soon. host: wyoming, republican line. caller: i would just like to say a few things and please do not cut us off because we do not get a chance to get in as many times as the democrats and the independent line.

i'm a conservative woman of color. i notice every time on c-span and i get to be disappointed. and i will get to my question. i notice a tally every time a conservative get inverses a democrat and the independent line. and the independence more or less go along with the democrats. we do not get a chance to get in. it is unfair to us out here. we do not get a chance to speak and we do not get a chance to have a lot of conservative hosts who would speak on our behalf. my question about the economy, we are a small business out here. ñiwe are only asking chances to make and produce and the opportunity to sell our goods, the opportunity to get capital from small community banks. we are despairing about these

big banks and these huge corporations and so on. when i was looking for work in the '60s and '70s and '80s, there were opportunities. there were people that did not quite have the education that others had. we had jobs. now it is all about the big corporations. host: think we got your point. guest: i agree with where the caller is going with this point, which is the big banks are not good for anyone but themselves. this should be a point you hear from republicans and it is also something you should hear from democrats. i do not think this is a left or right issue. i think the issue is that like -- that right and left and center who are deeply skeptical of big banks, is that emerging coalition against people who more or less in the center are friends with the big banks and friends of wall street. and the point of my book, "13

bankers" is to try to empower this broad political spectrum of people. it is economics to break the power of the biggest banks. they are not necessary. they have become dangerous, and they should be stopped. host: next call from new hampshire, go ahead. caller: i actually lived in canada and for a year and the banking system of there is the best in the world. my banker told me that half of what they do in the states is illegal here. we need to get on these politicians and i urge people to take their money out of the big banks and go to credit unions and stuff and take their power away. we need to get together. i was wondering what your

thoughts were on a state-run bank and us doing the same thing over here in new hampshire. it's kind of like non-profit, i guess. guest: that is a great issue. there is a much broader mdot campaign called move your money, which is not my idea, but i encourage it strongly. it encourages people to look at their relationships with big banks and see if they cannot get a better deal by moving to a small community bank or a credit union. i do not think we need new banks in this country. i do not know the situation in new hampshire in detail, but everywhere that i have lived or looked at, there are very good smaller banks. i think with a small community bank in massachusetts and in washington d.c. i'm with a credit union. i keep my money there and have taken out mortgages. it is excellent service. and the bank of refunds my atm fees wherever i use my car.

move your money is designed as a set of tools to look at and look for alternatives within your community. i think everyone should make up their own mind. you should look at the details of what banks are charging you and for what, and i think you might be shocked in many cases that the big banks are not offering a good deal on deposits or loans. host: turning to the situation in europe, the headline in the "wall street journal" has a chart that shows that france and germany are exposed to about $436.1 billion in outstanding debt. that is in spain. the prime minister of spain this morning spoke and said he sees as being a returning to growth in the first half of 2010. we covered about speech before our viewers to know. will be airing that at a later

date. go to c-span.org for the airing of that, but what do you make of the prime minister's comments? guest: i think, spain is the issue. a lot of the concern is about spain. if there is a more general spread a a, a more general weakening of the clot -- of the economy and low growth in spain, more losses in housing and concerns about their deficit, then europe is moving into a new phase of much more serious crisis. that is where european leaders are trying to address. they are more or less hoping for the best. i do not think they have any serious contingency plan. i think they just want this issue to go away. unfortunately, that is not a good basis for policy making and we shall all be concerned. host: the democratic line, good morning. caller: i was wondering what you feel about the regulatory agencies because most of them

deliberately set up as a separate because then it is like a low-grade contracts from construction companies. even if there was the political will to create just one regulatory agency that actually has some teeth and will not just say we will regulate u.s., it would be political suicide for any politician that did that. guest: that is a great point. we have a completely byzantine complicated regulatory structure in the u.s. that grew up for historical reasons. it does not make a lot of sense. there is a recent push to have a single regulator. and you can -- in the past, you were able to shop around and find uighur regulators. that is what aig did, for example. if you have a single regulator,

you cannot shop around. but you also have to worry if what if the single regulator becomes captured by the financial sector? the federal reserve board based in washington is the natural regulator of everything because there are lots of smart people working there, they see the big picture, they can pull the picture together. presumably would keep some state regulation, but those two levels would work together very closely. but the fed itself for this nonsense as much así:ay. alan greenspan arguably is the most are to give a proponent of dangerous economic financial policies in the history of this country and he is -- and he was the chairman of the federal reserve. politically, i do not think he will have one single regulator. i think as the caller said, lobbyists will oppose that. but do we change the attitude, the mindset, the philosophy of our regulators and supervisors? if we do, then we can look -- we

can work with multiple agencies. if we do not, it does not matter what kind of institution we have. we will have serious trouble. host: james on the republican line. caller: this is a very interesting discussion. this financial meltdown, which started with the bears aren't -- the bear stearns had fun package -- hedge fund package in 2007 had been going on for several years. i'm amazed that over this time, a i aig never was able to captue these investment funds. ñiand in many mortgages and loas

could be made without proof of earnings and what not. why could this happen over several years? the job of the federal reserve is to maintain not only steady growth, but a stable banking system. we know greenspan does not believe in regulation, but there must be people under him -- he's got 12 regional banks. there must have been people that knew this and watch this going on over several years. host: let me add one more thing to what he was saying. holman jenkins writes in an opinion piece this morning in the "wall street journal" usain, "perhaps there was a liquidity paniced and these banks were not necessarily destined to lose fatal amounts of money by holding these assets to maturity." that instead of they being too

big to fail, but rather, there was a panic, a run on liquidity and that is what is to blame. there were guest: obviously a panic. the panic -- guest: there was obviously a panic. the panic was that these banks are going to collapse. thinking that it is okay to leverage yourself 20 to one or even 30 to one or 50 to one, and you buy stuff and if it goes up, you make a lot of money. if it goes down, it wipes out your capital and you are insolvent. that is the fundamental principle here. when people argue it was a liquidity problem, that is largely a smokescreen. most of the mistakes that were made were mistakes of assessment of risk and understanding. the big banks did not understand, and in my view, still do not understand the full nature of the markets in which

they are engaged. or if they do understand it, then they are very cynically playing a game on which they went on the upside and on the downside for aig or for bear stearns or for laymen, or four goldman sachs now, the impact is felt by the taxpayer, by the people who have lost their jobs and is felt by everyone pretty much except those banks because they walked with pretty large cash payments. host: alan in new york, go ahead. caller: good morning. last evening i watched a special on a local public broadcasting stationñi about the over-the- counter trading of jurors -- of derivatives and long-term

capital management. and the lady that saw this, how she had come before congress and told congress, this is what is going to happen. and geithner, greenspan, rubin, and -- i forget his name, he was the president of harvard -- they all ran her out of town. she was just a desk with no lights on. what you are saying dovetails into that very succinctly. it hits its spot on. my question is, as a high-school graduate, working mom -- most of my life, retiring soon, what can the average citizen a look for?

because she predicted that this will happen again and again until this issue is resolved, when congress is the backbone to actually address it. what signs in the economy can we see? host: professor johnson? guest: i'm very glad the caller mentioned this television show. is a frontline documentary called "the warning" and the central character is a rare -- is a woman called berkeley born -- brooksley borne. and she was defeated, as the caller said, by alan greenspan began and -- and by rubin and the chief economic guru of this administration. the caller is right.

no question about it, she was right. the over-the-counter derivatives were dangerous in 1998. that was shown by long term capital management that failed and became more dangerous of the decade that followed. and it became an integral part of how the financial crisis in 2007 and 2008 became so damaging are on the world. as to the caller's question, what can we see in terms of getting this off in the future? we do not affectively sebring this in, in part because the people who are the traders of the over-the-counter derivatives spend an enormous amount of money lobbying congress. until we decide this is too dangerous to allow, it will continue and we will continue to put ourselves in harm's way. host: derek on the democratic line in south carolina, go ahead.

caller: the bankers are monopolizing the entire united states. guest: the solution is not hard to design a politically. it will be a long, hard slog over the next decade. the big banks have to be broken up. they have to be made smaller. they have to hold a lot more capital. we ought to have a lot more capital in these derivative transactions. the situation now is very much like that faced by teddy roosevelt of the beginning of the 20th century. we have this massive -- these massive industrial trusts, for example, designed by john d. rockefeller. people thought he was crazy and they did not think it would work and did not think that there would be benefits for the economy. and he fought very hard, teddy roosevelt, against the odds. and jpmorgan was substantially reined in. we need to do that again.

this turns out to be a periodic concentration of financial power and elected democratic authority in this country. we have done it before. and we will have to do it again. host: we only have a couple of minutes left here. the associated press is reporting this morning that industrial production rose 0.9% in january, the seventh consecutive monthly increase. help us make sense of that. what does it mean? guest: we are in a recovery phase. the economy went down very steeply at the end of 2009. what should happen is a rapid bounceback. if anything, the recovery is rather slow compared to other experiences in part because the credit system is still so damaged. hopefully, the unemployment rate that started to come down will continue to come down, but unfortunately we have these other problems coming from greece, from the hero, and our own problems around commercial real estate -- from the bureau

and our own problems around commercial real estate. i do not think we will see a big driver of growth coming from that angle. we will see how strong growth is in the second half of this year. the first half i am not so worried about. it is the second half i fear we will have a slowdown. guest: as we have been discussing, wherever you are in the political spectrum, find your representative, find them on this point. find others whose views you feel comfortable with and support them in every way you can. discuss this with your friends. do not stay quiet and sullen and angry about this. get yourself in form. talk to everybody that you can. it is this change in mainstream consensus opinion that is really going to save us. it takes a while and a lot of hard arguing among ourselves.