coast are preparing for a hurricane's potential landfall. washington, d.c., the policy community, start of direct talks on the arab-israeli peace process. day two of a series of hearings into the financial crisis.

the commission charged with understanding its rates. we will talk about all of that and more this morning. we would take their question from day one of phil and delete these's meeting, where what cobia and lehman brothers testimony was heard and the question was the concept of bailout. there are a lot of candidates on the campaign trail who believe the public's appetite for bailouts are gone and it will be a campaign issue for some candidates. we want to pick up the theme as it is being discussed. that is, whether or not you think there should still be companies who are big -- too big to fail. here are the call numbers. a good thursday morning to you. the topic this morning is really being drawn, as i said from the open, the inquiry commission

yesterday. one of the panelists who testified about lehman brothers is reported by the reporters watching it today as getting a sympathetic ear from of the commission, suggesting that if the government had helped him, his company, as they had others, that lehman brothers would still be around today and would not have been a bankruptcy of the size it was which people thought had a cascading effect. this is a way to get into the topic about whether or not you think some companies in the future whether you would be supporting keeping them in business to preserve jobs and prevent the cascading in fact, or you reached the point where companies should be allowed to fail and they for their mistakes and there should not be government underwriting, bailout, loan guarantees, etcetera, for those who make mistakes and get into bad situations. that is our question. we will begin with a telephone

call from california. tracy on the independent line. you are on the air. caller: i believe that everybody has the right to pursue happiness and if you work hard, you can get it. but as far as the bailout, i don't think they should have more -- they should have enough capital to cover all of their losses. host: ok, thank you. republican line. calling us from los angeles, at an early hour. caller: i wanted to comment. i don't think the government should help any firm, and there are no firms that are too large to fail. there are perfect bankruptcy laws that are printed on the books. we just have to let the strongest firms survive and those of that for some reason cannot maintain their costs, you have to let them go. we cannot interfere with our

market system. host: thank you for your call. i mentioned about candidates. some candidates picking up on this theme. here is just one example. cathy rodgers, washington's fifth congressional district. on her website, she has a series of pledges should see is putting forward. no. 5, reversed the wall street bailout. saying she had voted against the $700 billion tarp the bill and now our goal should be to make sure something like tarp never happens again. no company is too big to fail. the only thing to big to fail as america itself. one candidate picking up on this theme of bailouts. let us go next to mount prospect, illinois. this is bob on the democrats' line. caller: good morning, c-span. i feel good today. i just feel good. of course, these companies should definitely be broken

down. the battle -- debacle that the way the country was put in. can i just say one last thing? the reason i feel so good? i feel so good that joe biden and the president obama, they make me feel so good. you know, proud of this country and proud to be black. i want them to continue -- senator clinton -- to do what they feel because i trusted them. host: today the financial inquiry commission is going to be hearing testimony from sheila bear, who as you know well, -- sheila bair, heads the fdic.

and terms of her jurisdiction, there have been so far this year 118 banks that have failed and have been taken over by federal regulators. that is year to date. 2009, 140. back into thousand eight, during the roots of the crisis, just 25 that year -- back in 2008. reporter writing about this saying the problem bank list is growing. that number of 118 make it larger by year's end. they are going to hear testimony also from fed chief ben bernanke. he has been talking about this too big to fail concept frequently paired here is one example of him talking about it way back in march when he was in front of the independent community bankers of america. he said the problems of some firms being perceived as too big to fail is one of the most insidious barriers to competition in financial markets.

ironically, the number of the firms got larger and efforts to save them. we want to hear your thoughts about the concept of companies being too large to fail. bob graeme talked about this yesterday. let's listen to him. >> it seems to me that the key question here is, well there continue to be the political support to do what has been done in the past few months, which is to intervene at the time ultimate crisis. second, if that is suspect, that continuing political support, of what are the fundamental ways to avoid reaching that point of

extremists, there are many members -- there are many candidates this fall running on a platform of no more bailouts. and are committing themselves not to support programs like the tarp program should they be effected to congress. whether they will be a majority voice or not is unknown. but that voice is certainly going to be louder in the next congress than it has been in the present congress. so, if you assume it is going to be more difficult to come to the assistance, and if the consequences of not coming to the assistance are as catastrophic as we described, then it seems to me it puts a particular premium on figuring out how to avoid getting to that extremists. host: former senator bob graham

-- how do we avoid getting into situations where companies need that in the future. talking about should a company big two -- be too big to fail. alexandria, virginia. democrats line. you are on. go ahead, please. ellis, speak up or we have to move on. caller: i am speaking up. host: what do you have to say? caller: nobody should be too big to fail. host: de have anything more to add? caller: the reason i think these people should be allowed to fail is because already the government has already bailed them out. and at this point, we are still working on bailing them out, yet they don't seem to be helping anybody else out here in this economy right now. and they are actively lobbying right now in congress to try to get to -- republicans get back

to office. part of this deal. it is all partisan. and it is all about politics. and what is going to come down to in the end is they say they don't want it to be failing -- ok, the republicans don't, but yet the democrats are saying they are trying to restrict this now so nobody can be too big to fail. and what we will end up is these big companies are going to get their money back, they will all buy into their way and they will -- obviously what we are looking at, where we were before. then we are going to be back in the same boat as before -- and they will bail out their buddies again. host: next is a call from a viewer in wisconsin by the name of alan on our independent line. good morning. caller: should not be too big to fail. break them up into smaller entities and put these guys in prison where they belong and

this will not happen. both incumbents out of office. we are being fleeced. this happens every 20 or 25 years or more. and our politicians are in bed with these guys. that is all i got to say. host: allen from wisconsin. barry smith tweets a different point of view. kevin hall is on the phone with us from mcclatchy newspapers, following the commission but also deeply involved in reporting on the financial crisis and the government response. good morning. thanks for being with us. guest: thank you for having me. host: the headlines today suggest that the commission was sympathetic to the layman brothers chiefs argument that if he had gotten the same kind of help from the federal government

that lehman would still be around today. did you sense sympathy on the part of the commissioners and their questioning? guest: what they were focusing on, you are a good boy, you are a bad boy, you are a good boy attitude in how it folded. it is easy to kind of look back now with that attitude -- remember, at the time, the interconnectedness. i think one of the concepts that sometimes gets overlooked is these investors -- institutions that are so big are so interconnected. saving the six to help the healthy. -- saving the sick. but it is a little -- when he said he was surprised about this. when bear stearns failed, the overnight weekend sale to j.p. morgan, that lehman brothers was immediately data --

identified as the next week fish and had many months to prepare for it. that it happened overnight is not quite true. host: maybe you can comment on the thinking of policy makers about the fact that and the quest to save some of the large financial institutions such as what cobia, they encourage mergers with wells fargo -- such as what kolbe of -- wachovia, that they encourage mergers with wells fargo. it increased the risk? guest: i think the immediate thing was trying to plug the hole and then had to figure out what to do with the ship. out of that, you had bank of america and citibank -- citibank actually did not expand during the crisis but had done it before the crisis and that is why they were in the mess they were in. the size of banks have gotten larger and under the dood-four reform bills -- dodd-frank

reform bill, they can say you're too big and we will make it smaller. the question now is who are the target and are willing to use that authority. host: we quickly played, where former senator graham suggested that the public as quickly waning. i am wondering what the view is about a lot that just passed, and whether and not as the kind of mechanism people will feel will be prevented in the future. guest: it addresses a number of things. for starters, the investment bank model that had lehman brothers and its competitors all relying on short-term financing for their liquidity, their actual cash flow, that model is blown up, it is gone. most of these guys have become bank holding companies of they had access to the discount window.

they become like a retail bank in that sense, because they were not retail banks before. they were able to leverage themselves and borrow 30-one to make investments. those days are gone. there is nobody now outside the regulatory scheme like it was before. you are going to have leverage requirements, disclosure requirements. regulators will have an auditing trail like never before. fights the battle of the war that is over and addresses a lot of what went wrong. the question and a lot of minds is what does it do for the one ahead that we cannot quite -- no answer to that one. host: i want to ask you if you can stay on the line before a few minutes. i want to talk to a few more viewers and when we come back to you, if you could set this jake -- stage for ben bernanke and sheila abir's testimony. pleasant hills, california. david, republican my.

please turn your tv down and go ahead. sorry, david. hits that mute. caller: there is no such thing -- host: sorry, have to move on. california. ross and the democrats line. a tv down, and go ahead with your comments. caller: the commission is doing an excellent job. the second thing is, people, they are capitalist by their philosophy. kind of a macro idea. they want to use but cabalist system, benefit by it and -- use in the capitalist system, benefit by it, then they want to run from it and get protection. do you live by this philosophy you die by this philosophy. host: next from union, maryland. granted, republican line. good morning. caller: good morning.

i think the banks and so forth should not be too big to fail. they should fail. the regulators ought to do their jobs. they did not do their jobs last year. so, if they do their job and stay on these people instead of being their buddies, i think it will be -- the capitalist system is the best way to go. host: next is a comment on independent line from robert in michigan. your on the air. caller: i think a company, when it reaches a certain size, i think they should be bailed out because they do affect the economy and they do employ a large amount of people. but i think the process in bailing them out should be a little different. i think the government should guarantee loans and force those

companies to provide loans to people who normally would not able to qualify. it therefore you would stimulate the economy. instead of just giving the money, they would just guarantee the loan and make sure they provide those loans, whatever the process is, that they would change the process. as long as the individual show that they could pay for the loans they should provide the loans for an individual that they normally would not give a loan to. that would stimulate the economy instead of just keep going around in the same circle. host: kokomo, indiana. bob, republican line. caller: thank you for having me on. i do have my thoughts on too big to fail. i can understand the government's concern about letting a certain type of industry fail, the cascading effect it would have done throughout of the resulting industries that support that. but when the company is too big to fail, they are probably not

big enough to understand complexities such as derivatives. and if they are not, perhaps dar 1 posit theories should perhaps come into effect and a stronger should have survive. if you are too weak and not able to understand such complexities like derivatives, perhaps you should fail. thank you for your time. host: indiana. that is bob. back to kevin hall from mcclatchy newspapers. they will be hearing from ben bernanke and sheila bair today. let me start with sheila bair. you wrote about the number of problem banks, suggesting the problem list has risen to 829 in the second quarter according to the fdic, a sign that bank failures may surpass last year's 140. we are at 118 so far. what do you anticipate the commission will be hearing from her today? guest: it will not be focused on

horseback -- on the actual quarterly report that just came out, but it will be focused on systemic failure and lessons learned. so i did not think you can read too much into that issue. but i do think she was quite instrumental -- remember the commission had warned about derivatives and did not get heard properly. she is probably going to be asked a lot about why now treasury secretary tim geithner and then treasury secretary henry paulson did not listen to her. she pushed on a number of initiatives that were kind of ignored. i think what they will focus on with her is what she was telling people, why they were not responded to some of her suggestions. host: looking at the list of bank failures, there was a lot of discussion yesterday of the washington mutual failure in

2008. according to this list, which is from wikipedia, at the time of its failure, wamu had $307 billion in assets. wondering where the line is drawn, where the fdic and other regulators will begin to consider how large is this institution and should it move to ok to fail versus what we should consider bailing out. guest: i think the distinction is kind of the global connectedness. meant thatnk wamu category. they were very exposed on mortgage-backed securities, for instance. there were pools of mortgages. but they did not have a huge amount of international exposure. i think they too big to fail concept really kicked in with these bigger investment banks. a real distinction between deposit-taking banks and the investment banks. the investment banks were the

ones churning out billions of dollars in these pools of mortgages, inventing these synthetic ceo's where they took some underlying asset and created hypothetical asset and started selling that on top of that. it became too big to fail because they were so interconnected and so much of it. that is why we are all suffering today. it is all kind of on winding. loss is being written down. that is the fine line and whether something is too big to fail, really how interconnected it is. host: a little while back i read a quote earlier and you're worried about the concept of two guards to fail for financial institutions. is he affected -- expected to talk about that today? guest: he is a historian on the great depression so he will probably be asked about kind of the run up to it. there were many things in the

great depression -- things call bucket shops which were not that different from derivatives, where you do not have to own the underlying asset, you can still that is going to die. he is also going to be asked about this memo. this came up yesterday. the memo in which he was warned by his own staff that letting lehman fell will be more complicated than bear stearns because they were so interconnected. one of the bankruptcy lawyers from lehman yesterday revealed that 250 people work full time right now in trying to undo the derivatives book of lehman brothers. that shows you how complex it is. almost two years later. host: kevin, thank you for the time you have given "washington journal" this morning. you will be watching day two of the commission. those of you are interested, we will cover it live on c-span2. thank you for your insight and reporting.

appreciate it. let us get back to your telephone calls and tweets. going forward, should companies be too big to fail? mike freeman tweets -- let us go to calls. this is a call from dale in iowa. caller: thank you for letting me get on c-span. i really like c-span. what i would like to say is, i think nobody should be too big to fail. the thing that makes me the sickest out of this, after we already bailed -- as the guy said before, those banks trying to do all the stuff making all the problems, now that we bail them out they are actually lobbying now to try to get the laws changed back into their favor again.

we could be heading right back down that same road again for everybody to ask for a bailout again. host: next is a call from kinston, north carolina. kevin, republican line. caller: i just wanted to make a couple of comments. where in the constitution say that the government can bail out any free-market corp. to begin with? that is my big problem. one more comment. does anyone not realize that the bailout was organized, it was an organized collapse of our economy, it delivered collapse by the bankers and now, just like the gentleman just said, now they are coming in and asking for more money and they want their status on the bailout. before the crash, ben bernanke refused to admit we had a problem, that we were in a depression. host: why would they deliberately staged a collapse?

caller: that is the problem. that is what they do. they deliberately organized or collapse economies and they come in and they act like they are going to save us. that was the plan to begin with. host: ok. that is the call from kevin with his point of view in kinston, north carolina. oak ridge, tennessee. on the democrats' line. good morning. caller: my comments concerns too big to fail. i think there is an inherent conflict of interest in being a banker. what you want to do is sale as close to the wind as you can in order to make as much money as you can. you can't control that by regulation because of any number of problems. there are always loopholes and regulations. and the banks themselves can capture and the regulators.

evidence of that is nobody saw it coming. i don't believe that. ok, so the way to prevent too big to fail is to limit the size of investment banks. then they are not too big to fail. that is simple. host: david from oak ridge, tennessee. "the new york times" in its reporting on dick's fault, it also twins that with christina 's goodbye speech. stimulus averted depression, she says. it is available on our website and video library and you can watch it on your own terms on your computer. wisconsin rapids, wisconsin. neurosci, independent line pretty caller: thank you for c- span.

-- rocky, independent mind. caller: thank you for c-span2. i do not think that should get that big. there was an article from "usa today" about what cobia -- wachovia under the money for drug cartels. they were wearing money to wachovia smuggle drugs. because it was too big to fail and they would lose their charter is charges were filed, they were allowed to simply pay a fine and get away with breaking the law. i don't believe they should ever get that big where they can break the law. that is pretty much what i have to say. host: wisconsin rapids, wisconsin. also in the news is a report from the international monetary fund. this is bob davis reporting in "the wall street journal." here is what he writes --

britain and spain moving into dangerous territory. talking about too big to fail. pat, good morning to you. tv volume down and then -- i am going to move on. sorry about that. callers, you have to turn the volume down.

san diego. caller: i think the companies that are too big to fail -- host: we can hear you. caller: yes, i believe that the companies that are too big to fail, they should, if we allow the companies to fail who is going to protect the people who lose their jobs? somebody's got to clean up the mess. so we should always have a backup plan. just like right now, i am dealing with an issue with an insurance company. they got the law that is protecting them. so they are too big to fail but nobody protects the little people. i went through an episode in the michigan where all general motors left and the whole state is bankrupt and nobody is there to protect the people. i am pretty sure you have heard about the issue with detroit. how bad it is. just think about the people who

lost out. those are good american workers. we need to have more made in america instead of more made in china and india. host: you relocated to california? did you find a job? caller: i was a nurse. caller: so you were able to find a job in california as well? caller: yes, i was a nurse. i enjoyed myself on the job and i have been out of work for six years. yes, i have been able to find a job. but i enjoyed myself on the job, though, and i was out of work for six years and i have been going to court for six years. right now i get medicare for my injury when i should have been getting paid by my company. but somehow my company has put the payment on the federal government which, in return, --

instead -- they tax the people instead of the job taking care of its responsibilities, they put it all the governments of the government is doing with the job should have been doing. so i think the companies that are too big to fail, they should at a price to pay. when they fail they should not be allowed to recreate under a different name. host: ok, thank you for your call. next is california. john, republican line. your thoughts on this idea of too big to fail. caller: you can hear it in the last caller's response on the line. but the role of government has migrated to caretaker but really it is to regulate interstate commerce and provide for common defense. too big to fail is not something you ask the government. the government has limited control, ability, methods by which they do anything. the best thing they can do is get out of the way. too big to fail -- there is no such thing. and i postulate that had there

been less regulation to begin with, they probably would not be in such dire straits. the market was taking care of things and you would have little smaller failures, but what our government continually does is nettle and it and make things even worse so that it becomes almost a crisis. some day, these corporations were these entities are going to have to fail. you cannot just keep propping it up to save money or whatever. it is going to have to fail some day and a laundry you wait the worse it is going to be. host: a tweet -- from "the washington post," the capital city of pennsylvania, harrisburg, maybe all the way to bankruptcy. harrisburg says it will skip a bond payment.

next is franklin, tennessee, as we talk about too big to fail. mary, on independent line. caller: i have been wondering what ever happened to teddy roosevelt's antitrust and monopoly laws. it seems like it has been lost three time. and i really think those banks need to be broken up big time. thank you. host: here is "the washington times" coverage of the commission hearings. former executive says the firm could have been saved.

next on the concept of too big to fail, new orleans, democrat line. good morning, angela. caller: how are you doing? no one should be too big to fail. like the rich is getting richer and the poor is getting poorer, so i don't think it is fair to all of the people in the world. you are going to bail some of the company's outcome of the bill all of them out. that is the way i feel. host: the next comment is from

tallahassee, capital of florida. tom, you are on. caller: you asked the question earlier to a caller why would the banks want the economies to fail, and i did not think his answer was adequate for you. the answer to that question would be, it is not all banks. it is the big international central banks. the bank of london -- the big banks, the ones that own our federal reserve bank. and most central banks around the world. the reason is they would want regional economies of -- to fail or national economies to fail is to form a one world government under 81 monetary policy. that way they have complete control. that is the reason we are going through these plans economic crisis is that we have seen

right now. it should be plain. they are talking about one world government, they have been talking about a one world currency now and that all goes back to the central banks and that is what they want, the one world government. host: "the financial times" lead story. former minister said u.k. bonus tax failed.

right next to that story in "the financial times" is a photograph of the president of the united states barack obama with israeli prime minister benjamin netanyahu. the peace talks opened, direct talks. next is a call from little rock. packed on our independent line. caller: can you hear me? i was just cut off a few minutes ago. one of my point is -- no one seems to ask is how the investment banks became federally backed banks. it was kind of like the snap of the fingers.

i think there should not be a too big to fail. and if that man, if the federal government had given -- back then, if the gut federal government 50 banks and 50 states, if the government that each state and let all the people fail that would have been the better thing to do. now i think they need to break up the big monopoly corporations, they could look -- check their articles of corporation. if there is one thing wrong with it, anything, kick them out of the u.s. and kick them off of our stock market. that way you would let the little companies with the new innovations and new ideas and all of that kind of thing, which are now bought up by the big corporations, monopoly corporations. by the mob or destroy them -- like microsoft does. host: let's listen to the

chairman of the inquiry commission talk about this concept of too big to fail. >> it does strike me that in this crisis, it appears that the expectation of government intervention is so big it into the system is that the two institutions that were not saved -- lehman and wamu -- triggered panic in the system. it strikes me that obviously in the wake of lehman, there is tremendous panic. the government now has to weigh in with an $85 billion loan the next day. in this instance, wamu is not saved and the run began is really this afternoon, the next day, on washington mutual. which brings me back just to my original point, which is it seems to me that it is so big into the system that the focus should have been in the past and in the future, as the problems

are one of the risk is the one, institutional sales,, that is where the focus needs to be because when you get it the tail end but there is panic, no viable option but rescue. host: felt angeles's -- fell engine -- phil angelides yesterday. let us go to the next call. wanda, democrats line. caller: good morning. host: very early morning for you. caller: people on the mainland, you folks don't realize that these islands, the newspaper -- like mao way, these other islands -- not honolulu, are owned by companies in the mainland that bought out these small companies. the news we are getting, we do

not know if it is true or not. getting it like from the computer or going on line. but in honolulu, we only have the star bulletin. where are we here in islands going to get the truth? as far as the financial situation goes, it all started from 9/11. destroyed a lot of people's work that involves financial decisions. i think bush jumped in there with his people and tried to -- i don't know. like from way back when my dad was alive it is like -- my dad was a businessman and it was a monopoly going on here on the big island and on honolulu but all i can say is i pray -- and god bless america.

and i pray that the people in the world, especially in the united states, don't give up and don't give in. host: wanda calling us, there were early morning talk about her concern about consolidation in the news. "the daily beast + code as a headline, a new round of layoffs expected this fall and cbs is being trimmed to the bone. cbs evening news drew 4.89 viewers on average, the lowest ratings recorded in 20 years since nielsen has been keeping track. one person who works there described the atmosphere inside the network now as separate call. another round coming this fall. we are talking to you about to big to fail.

white plains, new york. m.j? good morning to you. caller: it is crony capitalism. you have fdic insuring banks and then you have the banks going around and taking so much risk. it is absolutely ridiculous. you are going to ensure deposits and the banks go out and lever up and take all of these risks just on the trading side and then you will come in and save them. of course, they are going to become too big and start taking away too much risk. you also had the fed which come in, the bankers' bank, and the whole point is to make sure the large banks that are close to them don't fail. it has happened in england, obviously happening here. on top of that -- currently running, doing nothing else

would pump more money into the bank's, and the banks have been buying futures and buying stocks, which is kind of held the market up to a certain extent. if you had a caller i believe from missouri who said what they really wanted to do, they should have chartered banks. they should have taken the bailout money and instead of pouring it into banks that have become zombi banks, they stood have chartered new banks all across the country -- it probably would have worked out better than what we currently have. host: are you in the financial- services sector? caller: i am an accountant. host: the last voice is going to be joe, independent line. gaithersburg, maryland. caller: good morning. i think what got lost in all of this is what actually happens to calls us to save these banks, and the problem was into dependency of the derivative products. the derivative market is not

regulated, so what happened is there these instruments floating out there that really had no open market to be valued. so, once these companies started to be fought, the people on the other side of the derivative, it is the first company goes broke, the second company would have all of these instruments that would go from some sort of price their 20, because it was a contractual obligation on the other side to cover the derivative products. it was not an open market like the stock and bond market. the dow was really the problem. it was not that the banks were stupid and all of this other stuff. it is once these things fail, it caused all of these things to go to zero, and the reason benson vested in them, like anybody else. somebody across the street is getting a competitive edge, an extra 2% or 3% for investing in these derivative instruments, every quarter you are going to get hit on a quarterly earnings

because you are not getting the extra income for your company. it is a lack of not having a market to trade these derivatives. and the lack of regulation that caused this. it is not bankers are stupid or some grand conspiracy. that is really what occurred. host: thank you for your call from gaithersburg. that is the last one of our discussion on to big to fail. we are going to take a break and when we come back we will have two guests at the table will get their perspectives of the opening of direct talks after 20 months between the israelis and palestinians. we will be right back.

>> there is nothing about finance that is rocket science. this is probably the most frustrating thing for me about how -- you think about ponzis teams, the biggest ponzi scheme for wall street is telling someone who has worked really hard to earn a buck that they are not smart enough to understand how that bock is going to be invested. >> in 2007, analyst meredith whitney was the first to predict major losses for citigroup, one of the largest financial- services company. she is our guest sunday night on q&a. >> join our conversation on the american revolution, the making of the constitution, and the

importance of historical study, sunday with a story in an pulitzer prize winner gordon wood on "book tv's" in depth. at noon eastern on c-span2. >> "book tv" primetime tonight, climate change. james hansen, who accuse the bush administration for censoring report on global warming. scientists who have different views on climate change. and geo-engineering the earth -- "how to cool the planet." >> the c-span at birds provide coverage of politics, public affairs, nonfiction books and american history. all available on television, radio, on line, and social media networking sites. find our content any time through c-span video library. and we take c-span on the road with our digital bus, local content vehicle, bringing our

resources to your community. washington your way, the c-span network. now available in more than 100 homes. created by cable and provide it as a public service. >> "washington journal" continues. host: as promised, with a roundtable about opening today at the state department of direct conversations between the leaders of palestinian and also the prime minister of israel. joining us at the table are two gentlemen who know about the negotiation process from a first hand experience. amjad atallah is from that new american foundation and his colleague daniel levy is also at the new america foundation, co- directing this task force. start by explaining your personal experience in these types of negotiations of people know where you are coming from. guest: with pleasure. my background is british but i became israeli and moved to israel.

adore my aren't -- army service i worked with prime minister rabin more recently -- but more recently advised in the prime minister's office. during a time before last i was on the israeli negotiating team , in the egyptian sinai in january of 2001. the closest we have ever come to an agreement. certain gentleman sitting opposite me in the palestinian delegation. guest: nice to be with you. very much like daniel, i was born and raised in the united states but i joined the palestinian negotiating team has a legal advisor in 2000 after cam data -- camp david before the tava talks. and i was promised and i was interviewed that they were confident there was going to be a peace deal before president clinton left office. they said it was going to be a six-month stints, very exciting, and i would be able to help the palestinians achieve freedom. i ended up being there for three

years of working on negotiations and my first encounters with the israeli negotiating team were in fact what daniel. host: is there anything different about this time that might suggest -- guest: not enough. is a momentk this for de--- deep pessimism to prevail, but one of the worrying things is there is not yet a distinctive approach on this peace process. if i was going to seek out what was different, it would be that as a president, obama has engaged early, on day one he appoint a special envoy, and he created a certain pressure on themselves by setting a one-year time line now. president clinton and his eighth year, president bush in his eighth year said i would get this done. barack obama it is doing this

now. his 1-year time line will expire as he enters reelected. i am not suggesting the american public will judge him on this. that is one hope -- the actual approach to getting piece done still has flaws. that if we are going to succeed it has to be ironed out. host: before we started the show, "the washington post" backers -- echoes the comments. do you see anything different that might augur for success right now? guest: i agree with the band that the differences on the american side. the israelis and palestinians have been negotiating for 19 years on and off and there have -- they have pretty much been negotiating the same terms. we know the israeli and palestinian positions. president obama is the wild card. he is what is different. but contact the nine states coming into the negotiation. this is the first time the president of the united states

says we have to have a resolution because it is a vital national security interest of the united states. different from all the previous negotiations in which the united states simply was playing the role of facilitator. host: the number of analysis pieces suggest that prime minister netanyahu is a key player this time. here is one of them in "the new york times." it rests on mr. netanyahu's shoulders and we heard the premise for himself -- prime minister himself suggested if he can bring along his constituency -- we all know where the left of center in israel faults. talk about what tools he brings to the table and what in the testing might have? guest: i did not think he really has carte blanche but not far from it. prime minister netanyahu, he will not be able to carry all of the right wing, but there is a phrase that the party has run on -- political message.

only the lilud can do it. it is the nixon to china thing. a two -- two models of the prime minister. the one who broke the mold was monacan bacon, who made peace with egypt -- menachem begin, remove the settlements, and with careful and determines guidance, he made the most historic peace deal is reached until the state. the other model was yitshak shamir. the first president bush had a peace conference, he attended it and later confided to his aides that my intention all along was to drag this process out indefinitely. the question is, which is prime minister netanyahu? at the same of the "new york times" ps there is a quote from

an israeli analysts, the key is whether enough pressure is exerted by the americans on benjamin netanyahu. host: by contrast, looking at the arab newspapers. a headline on this story -- abbas has the will and the way. what are his political realities? guest: a very complicated place. every palestinian was the same thing, an end to the occupation. on the palestinian side there is no one who doubts the sincerity of present abbas to achieve that -- president mahmoud abbas to achieve that. does he not have the backing of the public to strengthen his hand? the way the united states has played this hand, this is the weakest link in the chain. the united states in effect has not really tried to help establish a very solid unified palestinian policy.

it has tried to emphasize support for individuals. i think it does not even help the individuals it is meant to help. individuals need the backing of political parties. it would be as if president obama went into some very important negotiations, without even the support of the democratic party. so president mahmoud abbas has not been able to rally people not around the goal -- because everyone agrees on the gold -- but not able to convince them that president obama's policies of doing this through the oslo process, direct face-to-face negotiations with the united states playing a hands-off role, he has not been able to convince palestinians that is going to work. host: the issues are obviously complex and we could spend a lot of time setting the table but i really want to get to your calls and comments. we will put the numbers on the screen, lines/party affiliation. you can also send an e-mail or tter. i

the deadline for the moratorium -- guest: the night -- united states hoping that there would be a middle ground that they conform to their way through the end of september. the real problem for palestinians is one settlement construction takes place, home demolitions, it has a real and immediate impact on palestinians. they can look out of the windows and see the construction being built. in the united states it may work if you say, well, we are only going to be building in some areas and only building some kinds of buildings, only making them so high and only doing it in this place but not in that place. but on the ground for palestinians, and looks like the promise was broken. and if the promises broken only two weeks or three weeks into the talks, it is going to be very, very difficult for president a boss -- abbas to

maintain credibility if he continues negotiations without exacting a new understanding from israel. host: the prime minister faces pressure on the settlement moratorium. can you tell us how this plays into how the approaches the topic? guest: of course, the kind of moratorium prime minister netanyahu has been asked to extend is already a compromise. car out the tensions that prime minister netanyahu manage to get americans to turn a blind eye to. east jerusalem, obviously important to the palestinian side, and 3000 housing units are already under construction. he does face pressure. there is clearly a very significant political lobby of settles -- settlers and their supporters. he has chosen to bring them into the coalition. this is a right-wing coalition of choice. that is a switching may have to make eventually. the sense is that netanyahu perhaps does have the uighur room to expend this, perhaps

not been cleared to play but at least in practice. host: let us hear from our c- span viewers, beginning from a call from occurred on the democrats' line from baltimore. caller: i wanted to say, yes, i think that the peace process should have been took place. trying to stop human beings from making this person versus that person. i hope this peace process works. we are humans and we can all gather information and technology and we can help each other. i think right them -- right now, it is a lot of that politicians, people who are controlling

money. they are making us go against each other. i want to say to the first part, i am a young guy, i just started watching c-span. i was on you to, i see a video, and it was from somebody -- it was called helen thomas, the real jews, black people. basically, 12 tribes of israel and they were kicked l? could somebody explain that to me? guest: i cannot relate address the video that you saw, but you hit the nail on the head on the first two points. president obama has chosen to be the mediator. he is not going to invite the

parties to the room. he is going to have to close the deal the second thing you talked about, the vision for peace, you described with the middle east could look like after an agreement, and the president is with you on that. for the united states, the entire middle east will be a new place, a new dawn, if he can get this agreement. that is why is a security interest for the united states of course, it is important for the palestinians and israelis, but it is important that we recognize it is absolutely important for us to achieve this. host: stephen in brooklyn. republican line. caller: i want to comment on the two gentlemen you and i appreciate the arab negotiator. he seems negotiable --

reasonable. the other person, daniel levy, is the typical leftist point of view. you keep on hearing this over and over again, that if only netanyahu pressured the israelis to give in more and more, there would be peace. we are talking about two partners, a recalcitrant person is right wing israel. i will give you an example. there was an attack yesterday in israel. four jews were brutally murdered. so what did we get? we got condemnation from moscow abbas. -- mark would abbas -- mahmoud

abbas. he said there should be no bloodshed in the middle east. in these attacks against arabs, let us say, four israeli soldiers when they are defending themselves, he calls it in the airport attack. it seems like a minor point, but the so-called palestinian mentality does not look at this as an abhorrent act. host: let me give mr. levy is a chance to respond. guest: both president abbas and prime minister and the 10 yahoo! represent their own people, their own narratives -- netanyahu represent their own

people, their own narratives. if something happens to palestinian civilians, as has past, the waysthe that he will express those casualties will be sympathetic, will be expressed from an israeli position. the israelis are concerned, number one. likewise, in a courageous condemnation from president abbas, he is still coming at this from a palestinian perspective. of course, a neutral observer can express equal empathy, but one cannot get that from the parties themselves. host: a tweet from ann -- guest: i think there is a bit

of political strong are many. the idea for hamas is to be a part of the palestinian movement. its priorities are domestic, it wants to be in power. it has recognized that right now there is little trust among the palestinian public that these negotiations a will succeed so they are hoping to capitalize on that. i think they are over region -- the terrorist attacks against civilians, hamas may have thought this would have rallied people to their side, but it may have done the opposite. the point is, they are a political party trying to make gains within the political framework. if they find a way to make those political gain on the democratic field, then it can pursue that course. it is pigeonholed and told no

matter what happens, peace or war, you cannot play a role, they are obviously going to try to break out of that box. the trick for the palestinian leaderships is to find a way to bring all the palestinian parties into one tent in which they can actually provide a space for a democratic pluralist system. hamas can potentially be a part of that, all the other parties as well, but we will not know until we let that process take place. host: joliet, illinois. sherry, you are on. caller: all the oppression that is going on with the israelis, palestinians, and has led to the terrorist situation around the world. what they want from the united states is to snuff out their adversaries, such as iran.

they want the u.s. to go in there and fight them, like we did in iraq, so no one is there to help the palestinians. this is all about the haves and have-nots. guest: 9 think it is a stretch to say that all the terrorism around the world is related to the israeli-palestinian conflict. i do think one of the reasons you psaltery -- president in the room yesterday with a determined -- determination to see this through is an appreciation that resolving this conflict is an american national security interest. that is not just president obama's perception, but the pentagon, david petraeus -- he put it starkly, talking about

the inability to reestablish the credibility to work in the middle east, to push back against its adversaries. as long as this palestinian grievance, which americans are seen as a continuing, this will be a complicated issue. there is a lose-lose that we have played out for many years, but there is a win-win-win where the americans get to charity, and israelis get their borders, and the middle east can be stabilized. the president should take one day over the summer and say that he will drive his arms around peacemaking, because it matters to americans.

guest: there was a pretty important to went to events that occurred yesterday. the u.s. and did combat operations in iraq and made a speech where he made it clear the u.s. had no intention of occupying or colonizing iraq, that we were ending our combat operations there. the next day he talks about ending the conflict in the gaza strip and west bank. in the middle east, those two things are very connected. if the u.s. wants peace in the region -- is the u.s. the good guy who wants peace in the region, are they an imperial power seeking to colonize? those are the two never does that compete each other. this was within a 48-hour period. he basically presented to the

muslim-arab world, we have no intention of staying, but also came the message to the israelis, we are getting some of iraq, you have to get of the west bank. he has to make sure that he achieves this. you said you want to get out of iraq and you do not, you will not get credit for it. you say that you want to end the arab-israeli conflict and you do not, you will not get any credit for it. guest: on the israeli side, the elections are scheduled for 2013. this is a parliamentary democracy, and a small parliament with 120 members, and there are over 12 parties represented. if you think cutting deals in the congress is difficult, you should see israel.

what usually happens is there is a no vote of confidence and go to elections. guest: the palestinian side is a bit more complicated. the presidential elections have passed without taking place, terms for the legislative council have passed without taking place. in fact, there is no palestinian politician in power today, in gaza or the west bank, that is there through any form of electoral mandate. the plo, above and beyond the palestinian authority, that which negotiate with israel, has not had a elections for its national congress either in dozens of years. so there is a crisis of legitimacy among palestinians, partly because there have not

been any way of renewing the mandate of any particular politician, no matter how popular or unpopular. host: newbury, massachusetts. eddie. caller: it is the palestinian issue of military operation. they did get out of gaza, but it was not much of a success. how do you keep a jew out of jerusalem? this is a kent -- ancient land. please explain the two state system. guest: that is a good question because it gets to the heart of the narratives of both people. when i was in negotiations, the palestinian argument was that we were seeking two states, but not exclusive of other population.

we imagined it would look a bit like canada and the united states, france and germany, where people would be able to cross the border. the israelis could be able to shop in palestinian areas, palestinians coming over to the israeli side -- and it has been repeated recently -- palestinians are not opposed to jews living in a palestinian state. we recognize the jewish people have religious and historic ties that will be the palestinian state. there is no objection to the jews living in the palestinian state. are they going to live in there as a palestinian citizen, as israeli citizens, under what framework? this vision of two states with multi-ethnic population is moving back and forth, this has taken a beating since i was in negotiations. over the course of all the

violence that has taken recently, specifically in israel, over two exclusive populations. i think there needs to be a conclusion in a two state solution that allows both jews and palestinians to have access to both countries. the more interaction there will be, the more peace will be strengthened, amongst the people. guest: i think there is no taking the jew out of jerusalem, and i would be against any plan that would do that. the question about the two-state option is the following. is there a jewish-israeli political sovereignty in all of

jerusalem and to data? if not, if there is access but not 70, we have a two state solution. if there is that aspect of sovereign control, then either the palestinians are given democratic rights and it is no longer an exclusively jewish state, or is apartheid. that is what we are trying to resolve. host: i want to share with you a piece in the "wall street journal" -- the headline on it --

it goes on to suggest capital coming into the region. here is the closing paragraph -- what do you think about that?

guest: it is true, we have been there before, and in a way, it is built on sand. the palestinians and build institutions of democratic governments in the 1990's and there was an economy that was doing fairly well for conditions of occupation. after all, palestinians cannot move from one city to another without going through an israeli checkpoint, could cannot come in except through israel. it is a captive market. under those conditions, palestinians were trying to develop. israel took down that system within 24 hours. basically shut down every ministry, factory, every company within 24 hours. what you see now is an attempt to rebuild that can get back to what we had in the 1990's.

yes, it is important to see this building, but even the growth figures -- the world bank figures the report also say, this is still only 1%, 2% above what existed in 2000. it might be better when things were really dismal, but not much better than when things were in 2000. host: anything to add? guest: we are not yet back to where we were with the palestinian economy. it would be great to see recovery in ramallah, as it would be great to see investment in detroit, louisiana, were sudan for that matter. to resolve the political conflict, however, we need a political solution. if the economy makes great progress, maybe it will be easier to combine everyone into one state. it does not set aside the hard

political questions. it is almost an irrelevance to this. >guest: the only foundation to political success is the economy. this is all meaningless but we do not have independence. if palestinians do not have freedom, this will not work. host: gain in massachusetts. independent line. caller: these settlements in israel were given to abraham thousands of years ago and down to isaac and jacob nobody is supposed to bargain with them. i will not live -- if my land the way for a piece of bread.

-- i would not give my land away for a piece of bread. this is the land of god. his promise is to his people. i love is real and i love america and i think the president is totally wrong on this and he is destroying the relationship between israel and america. this is the first time that this has happened to me. they are just so for of of what the bible says. he is bringing his people back to the land because of the messiah is coming back. he is not going to bring them back to have them be chased out. besides, hamas, the plo, are terrorists.

they make is will look like the victim. they will not be satisfied with land. they want israel to be destroyed. host: let me jump in at this point, something for each of our guests to respond to. guest: israel set itself up as a democracy, not a theocracy. much of the relationship that has been maintained with america has been based on that value. yes, there are biblical prophecies from which we draw inspiration. i am personally not an enthusiast about having a jewish the chronic state of israel, as much as a theocratic republic of iran. it may choose to define themselves as a theocratic base,

deriving its decisions from biblical prophecy -- if that is the future of israel, and i acknowledge that there are more and more people in israel who think in those terms -- then everyone who disagrees with that vision, others with a democratic system, will have to step back and look at how they want to relate with that israel. the american president can only work with the israel that he has in front of him. it is a democracy based on political systems, politics. thank delay, we do not have rockets launched into israel -- thankfully, we do not have rockets launched into israel every day and the true answer to security will be having the palestinians have their freedom. get two states. live in the real world.

it will be an unpleasant place to try to exist in, whether that is in israel or the united states. guest: your question is illustrative of a cynical bargain that the israelis made 20 years ago with the american right wing. the narrative of god having given the land to the jews, and american circles, ends with the messiah returning and converting them to christianity. the notion that they could make alliances with pat hickey, others, work to ensure their

political ambitions could be supported within the u.s. system -- what happens when israel decides it is in their best interest to make peace? what if they find it is in their best interest to make peace with muslim countries? when israel decides that have to make that choice for the security of the future of jews in israel, ironically, they will find there is a coalition in the united states who will be opposed to jewish security, freedoms, because they have actually imagined and bought into this vision of a warrior state, that israel will almost always be at war until the apocalypse. host: next phone call. caller: good morning.

i basically agree with the concept, the idea of having a solution that shares the land, and gives both sides a chance to develop and have prosperity. but let us get back to reality and not be deluded. we were moving in that direction of few years ago. begins a sudden, arafat an attack. now everything needs to be evaluated. nobody is talking about that today. i enjoyed the meetings last night, too, but hamas cannot be brought into democratic leadership. they say they will never accept

is real, they want the destruction of israel. hezbollah, in the north, the same thing. iran is harming both of them. we have a threat of terrorism that is a threat to the existence of israel. it is not a question of coming up with nice ideas traveling together through these countries. this is a possible to tuition that could generate. take a look at iraq would sumy's and shiites. shiith the sunni's and ites. i believe these hamas groups are just waiting and waiting. they tried to scuttle diplomacy a couple of days ago --

host: let me jump in there. thank you. amjad atallah. guest: there is a lot of hate rhetoric coming from both sides. just one week ago, the head of the third largest -- fourth largest party of israel -- that is part of the ruling coalition in the government called for a play to wide on all palestinians. when you before that, a plauge for all arabs. his word is almost considered the word of god. as a palestinian, i can point to that and say, that is what rabbi joseph said, therefore, we cannot make peace with the israelis, it is impossible to

move forward. but in fact, the point of the conflict is to end it. if everybody was doing the right thing, saying the right thing today, there would not be a conflict. palestinian violence is not related to israel outside of the occupation. palestinian violence has to be understood within the context of the occupation. we want to end the violence on both sides. but that is not going to happen, absent peace. there is no imaginary state where peace is happening and nobody does anything bad, and then when that happens, everybody makes peace. at that one, we do not need to make peace because we already had it. guest: i would give israel more

credit in terms of what it has achieved in securing itself over the 63 years of its existence. these groups do not threaten israel's existence. they have a strong military, have proven themselves very capable. i often feel like we used these words lightly, and we do a disservice to what has been achieved by israel, in terms of creating a real effect on the ground. the challenge, how does one reduce terrorism down to a manageable portion, reduce extremism on all sides? i think it is clear there are circumstances in which terrorism flourishes. i would to just the circumstances of occupation, of the people being denied basic freedoms and dignity, are circumstances in which it is

much easier to rally people are ground to the cause of extremism. these extreme groups, yes, i have virtually no sympathy for the tactics used, groups like hamas. but take a look at this group that the prime minister may come about. they supported a former prime minister and said it was more important to save life than to keep land. it is true for the hard-liners on both sides. you can create an incentive system. there will always be naysayers. but you can bring in most of the hard-liners, if you are smart, and new technology they have a narrative that needs to be addressed -- -- and acknowledge that they have a

narrative that needs to be addressed. even in the u.s., look at who is trying to stablize things in iraq. can you say to this person, i understand your grievance, i am not justify what you did in taking american lives, but let me try to understand this grievance. if your grievance is my freedom back home, that is something i cannot do anything about. for most people, it is about their own life. if that agreement can be addressed, then you are in a much better place to destabilize these conditions and get security. host: you can find more information at the new america foundation.

the state department of bed begins at 10:00 eastern time after this program -- event begins at 10:00 eastern time after this program. thank you for helping us at this stage. we are going to take a break. when we come back, a member of congress joining us from colorado to talk about another big story, a declaration of the end of combat operations in iraq. we will be right back. >> defense secretary gates arrived in afghanistan's capital today for meetings with president karzai and top nato commander david petraeus. he also plans to visit u.s. troops. officials will find out how stable the plug that stopped crude oil from calling into the well is. the cap will be removed today so

that workers can remove the damage blowout preventer. while the cap is off, the government is not guaranteeing that the league will start again. ben bernanke appeared before a panel investigating the 2008 financial crisis. he led the economy through the economy in that time as the federal reserve took extraordinary measures to inject hundreds of billions into the financial system. the commission will also hear from the fdic chair sheila bair. live coverage of this week's financial crisis when greek commission -- inquiry commission starts at 12:00 eastern. hurricane earl continues to beryl towards the eastern seaboard. forecasters are trying to pinpoint exactly where the strongest winds and heaviest surge will be. they are also trying to figure out whether the storm will stay

off of the east coast or bring hurricane-force winds to the boston and long island area. >> search the term "mideast peace" at the video library and you can see thousands of videos and transcripts, including a mike wallace interview, interviews, forms, all leading up to this week's middle east peace talks. host: in joining us from denver, colorado, at our studios there is republican mike coffman, a member of the armed services committee. also a veteran himself of the army and marine corps. we invited you here to get your perspective on the president's announcement on the end of combat operations in iraq.

what are your reactions to his announcement? guest: very positive, obviously, relieved that we have been able to get to this point. i served in 2005, 2006. certainly, there were times that i did not think we would see this day. we are not going to put a banner up that says mission accomplished, we know better than that, but this is a milestone in our involvement. host: what kind of accomplishment is this if there are still 50,000 troops coming engaged in some kind? guest: we ended our direct combat role there.

according to the status of forces agreement, we will have those 50,000 out by the end of 2011. unless there is a change in that, both parties agree, we will not have forces in iraq past 2011. i would imagine, maybe an advisory, support role, in a limited way, but a much more smaller footprint. host: what challenges remain for the country? guest: from the united states point of view, iraq now has 66,000 security forces in place, thanks in large part to the u.s.. that is a substantial force that is quite capable of defending themselves against the current

threat. the fundamental issue with iraq is a political one. their ability to form a government after the last elections. host: do you have confidence from what you have been seeing over there, reading, that they have the ability to get over their political problems to do that? guest: i am concerned. iran is certainly having an influence in the process. i tend to think, perhaps i am optimistic, that they will form it. they had good elections. it is a parliamentary form of government. it is a matter of forming a ruling coalition in the parliamentary system that is necessary to form an executive.

host: we want to invite viewers to participate in the conversation. you may also e-mail us, journal@c-span.org. i want to hear a clip from one of the other speeches regarding policy. defense secretary robert gates was before the american legion and he talked about the continuing perspective on the ground, american obligations air. >> today, at the end of operation iraqi freedom, 4427 service members have died in iraq. 3502 of them killed in action. 44,268 have been wounded or injured. host: that was just a list of

the american contributions of blood and treasure in iraq. "the philadelphia inquirer" has a column related to that. she writes -- do you agree? guest: absolutely, we have a role, but it is not a military role, a diplomatic one. we need to be more engaged, from that point of view, in iraq. certainly, al qaeda is alive and well, trying to keep the country from coming together by inciting

sectarian violence, but i think our issue in iraq is a diplomatic one. help them form a government, help them develop a multi sectarian government. those are the challenges. this is not like vietnam where you have a substantial, conventional army ready to invade the country. host: first phone caller from connecticut. dan on the democratic line. caller: i have a question about military contractors. i was wondering if they are still in iraq? have you investigated the abuses that took place in iraq?

for instance, schools that were not built, sewer systems that were not built, all these unaccounted for billions of dollars? i also want to know, can you speak of hamid karzai banning military contractors in four months? host: let's begin with the number of contractors. guest: there are a lot of contractors but it is being phased down commensurate with our military drawdown. certainly, earlier on, there were extraordinary problems with corruption, working with contractors, both in and out of iraq. there were lessons certainly learn from that. as with hamid karzai, i think he

is talking about contract security forces, wanting to ban those. there is a concern that that would cause the introduction of potentially more u.s. ground troops on the ground to make the difference. host: his other question was on corruption. guest: i think the corruption issue is significant in iraq. with u.s. tax dollars pouring in there to help them rebuild their infrastructure, there are ongoing investigations on that, certainly lessons learned, moving forward. host: how much time have you spend on the ground over there since being reelected to congress? guest: not too much time. we went over there last may, in

june. i met with the general odierno in baghdad. one of the key point they make to me is the concern of the day. the current prime minister, will allow maliki -- al-maliki allow the democratic power process to take place? host: dean is on the democratic line. caller: after thousands of dollars, iraqi kids being killed in the streets, u.s. marines being killed, what lessons have we learned from iraq?

guest: that is a great question. frankly, -- my view is not shared by my military colleagues. my view is we should not do it again. this notion of using nation building as a tool to achieve our security objective is fundamentally flawed. to reality is, we could have accomplished our security objectives in iraq without invading the country, rebuilding it into a modern political state. the reality is, 80% have disaffected with the regime. we were flying combat air patrols over two-thirds of the country to protect the population. we had provided limited direct support to those elements and

they would have opposed the regime. in my view, we could have had something comes out of bed, certainly -- out of it, certainly, not designed as a western country with too, but would keep our security interests in tact. we need to revert back to the notion, i believe, of supporting factions that support our interests without this very idealistic foreign policy that has been so costly to the united states. host: after his speech, secretary gates went to iraq himself. "the washington times" has the headline --

next phone call. charlotte, north carolina. cathie on the republican line. caller: i do not feel like we have withdrawn with so many troops there. i do not remember how many we started with, but that is still a lot. what happened to the one that come home, do they go to afghanistan, will the majority go to unemployment? . coffman?o guest: will ultimately happen, what we call downtime, time

between deployment -- we need to give them a break. we have pretty much exhausted our ground elements on the ground and seaside as well. it has been multiple, difficult the plants. -- deployments. our numbers in iraq were around 150,000, now we are down to 50,000. now we are starting to increase in afghanistan. the last 30,000 contingent that the president promised last year are now almost fully in place. i think i will numbers are roughly around 100,000 in afghanistan right now. it must 30,000 at that time that we had 171,000 in iraq.

so the aggregate numbers will be lower than they had been. host: this twitter viewer wants to know -- guest: the war in iraq is a high risk-high reward proposition. if we can establish a representative form of government in the heart of the arab middle east, as president bush had stated, will lead to peace and stability in the region. i am probably not one to defend the policies since i am not supportive of it. however, once we make the decision to go in, you cannot simply walk away. you have a responsibility to reasonably see it through, to bring into, what i would call,

just conclusion. host: terence on the independent line. caller: thank you for coming on, congressman kaufman -- coffman. thank you for taking my call. it is difficult to speak to a congressman in person. you do not seem like one of the gloom and doom republicans, you seem pretty positive. that is very refreshing. i am a young guy, but i am an avid reader of history. after world war ii, we came up with the marshall plan. we beat the soviets in

afghanistan in than 1980's -- in the 1980's but we did not follow through with infrastructure. will we do the same in iraq? i hope we do not. i think we need to keep our diplomats there, a good corps of engineers there to build the country, showed them american technologies, maybe get some movie producers over there to help document their history -- things like that. we have to change the psyche of these people. thank you again for coming on c- span. please come again. thank you. guest: you are right, we need to stay engaged in iraq. certainly, at an economic level, perhaps in terms of advisory,

support, from a military point of view. i think you are right, we disengaged there after we helped the mujahideen drive the soviets out. when we were not paying attention, there was a vacuum bill from radical elements. let me just say on afghanistan, i think it will be more difficult than iraq. what president bush did at first was absolutely brilliant. we were attacked a on 9/11 by al qaeda. the taliban controlled much of the country, gave al qaeda a safe harbor. even after the attacks, we said, turn over your usama bin laden, and they refused to do

so, but instead of putting our conventional ground forces in there, we gave logistical support to the anti-taliban task forces in the northern alliance, and they drove the taliban out. now we need to have them reach out to other elements in the region to reflect the ethnic areas. we gave them the government that they wanted to have, and that is what we are defending today. once we made the commitment to go in, we have to make it work. i spoke with the secretary of defense recently. i think he is starting to move in the right direction by looking at a more decentralized time of governance, our aid

flows, working more with trouble elements -- tribal elements as well as the central government. i think we are making changes there. we could have simply said, we will support you -- after the -- asrn alliance had one -won long as you keep the taliban, al qaeda out. host: congressman michael kaufman is joining us and the c- span cable center -- coffman is joining us at the c-span cable center in colorado. his district is in the denver suburb, including aurora.

he attended the university of colorado under the gi bill. served in the army, marine corps. two decades as a founder and senior shareholder of a property management firm, during which time he served in the colorado house of representatives and as the caller and a state senate and state treasurer. twice returned to active duty, once for the gulf war, and again in 2005 to support the independent electoral commission of iraq to help establish governments in the western euphrates valley. appear from hamilton, ohio. ronald, democrat's line. caller: good morning. i would like to ask the congressman, since he is saying that we should stay there and

injected billions into their infrastructure, in an oil-rich country, why is it that every thing that came through congress, republicans voted against, but we are supposed to trust their steel workers, contract workers, why not have them do the work? instead, we are putting our own money to support the companies and workers. we could jump-start good wages, they would open stores, etc., and they would know that they are working on their infrastructure, investing in their own companies, paying taxes to their own neighborhoods to support their roads and schools, etc.

guest: you make a good point. when i was running for congress, one of the issues i ran on was to cut off the infrastructure development in iraq at the expense of taxpayers. i strongly believe that. since i got in, just the timing had been phased down. i certainly agree with you, why are we developing their infrastructure -- i remember in 2008, when we were running a budget deficit, they had a budget surplus. their government was not set up

administratively to do those types of appropriations through contractors. we were in gauging through the taxpayer. we were borrowing money to build their infrastructure, which is crazy. i am certainly sympathetic to your view on that. we need to take a look at this nation building thing and ask, is that the proper role for the u.s., do we have the economic capability to do that? i do not know that we do. host: rob on the republican line. arlington, virginia. caller: i want to start with a brief note of fairness for this sitting president, president barack obama. he did say afghanistan was the good war, he did say that on the campaign trail. for him to receive criticism

about going back on a promise is wrong. he said he wanted to leave iraq and to work in afghanistan, which is what he is doing. as i see it, one of the few promises he kept. there were a lot of attacks since president obama became president in the green zone. there were eight in the month of june or something and the media has remained silent on that. if george bush were still president, they would be airing not constantly. it would be on all the front pages across the country. when you see an uptick of violence in the green zone, it may not be a good time to pull aout. it seems like amateur hour here.

you could take all of the money spent, look at all the projects that have been completed -- massive amount of projects -- add it all up and it is about $35 billion. this is straight from the department of defense. there are green circles on a placard representing different projects around the country. a lot of heavy lifting was done in iraq. george bush got it moving properly. foreign policy 101. history will bear that out. now we just have to hope that this current president does not botche it. guest: certainly, i share your concerns in afghanistan. let me just say, in iraq, i

think it is interesting -- i commend the president for breaking his campaign promise. what he effectively said, as a candidate, in 2008, he would expeditiously withdraw here regardless of the conditions on the ground. what he did was follow the exact timetable as laid down by president bush in iraq, without question. it turned out to be very successful. what he has done in afghanistan, putting a timeline on a withdrawal, is ill-defined. i understand why he did that. he did that to get the support, particularly of his own party in congress, but i think it has had a bad effect in afghanistan, in

terms of their view the in our level of support in afghanistan. i think it is better to put down time lines which are not sensitive to conditions on the ground. i do see hope in afghanistan to the extent that -- in vietnam, starting in 1969, the army, the military started to replace our forces on the ground as they build up. they were certainly not as capable as we were. the problem then, sometime after the 1972 election, congress cut off all funding, including ammunition and fuel.

i hope americans do not get tired to the extent that we pull the rug out from under the afghan people. clearly, we need to phase down our forces in favor of theirs, but in a way that is tied to conditions on the ground. host: tony blair's new memoir has been put out. there are a number of stores in the newspapers. in "the new york times" --

mr. blair, by the way, announced that he was donating the $7 million advanced to the british legion, there principal charity for ex-service members. we are speaking to michael this morning. paul on the independent line. caller: i had a quick comment. i have an idea of what we can do in iraq. instead of pulling out, all of these billions of tax dollars, lives that have been spent, we should build a gigantic military

base and make everything work for americans. the infrastructure is down, our bridges are falling. why not just stay over there and make it worth our while? it will be like the roman empire. we can provide peace to the country. guest: iraq is a sovereign country. at the end of the day, we have a sovereign forces agreement. it would take both parties -- the u.s. and iraq -- to allow any kind of permanent basing facility. as to whether that would be advantageous to the united states, i cannot tell you that, but i tend not to think that the iraqi government will support that. host: maryland. willie on the democrat's line. caller: i am wondering why it is

so hard for republicans to give president obama any kind of

credit

caller: and all the circumstances around it, and everybody involved, except you guys. how are we supposed to the drought would happen, who was responsible, what all the money is banished from the united states, if you refuse to look at what went on? guest: i think there have been investigations, and they have drawn conclusions, and there is an oversight investigation committee in the house that has been active. control by the other party has been active in terms of pursuing issues as to the corruption that certainly occurred with contractors in iraq.

and there are lessons learned coming out of there that are certainly being applied in afghanistan today as we speak. obviously, we cannot go back and make right what happened, but we can certainly learn from his mistakes and move forward. -- learn from those mistakes and move forward. i am only in my second year of congress, but from what i see, the investigations took place and there have the lessons learned and we have moved forward with the lessons. host: sun valley, california, independent line. caller: have you read it the 9/11 commission report? you understand the motivation behind why we got attacked? we have got to attack because of our support for israel and there are questions -- got attacked because of our support for israel and i wanted to get to

the peace talks, too, because i wanted to correct that guy who used to work for barak. aipac, the most dangerous jewish lobby, pushed us into the war with iraq. barak said in 2002 that he was glad we went in there. because it made israel more -- he practically blew the whole cover, because it is real more secure. i'm tired of this. they are driving the country into the ground. host: congressman, do you share those points of view? guest: no, if you look to the writings of osama bin laden, the statements he made prior to 9/11, he never made the nexus with israel. he was with radical islamists to try to bolster support from elements of the muslim world.

but i don't think that resolving the arab-israeli dispute will solve problems the united states has now with what i call radical political islam, which i don't see as a religion, i see as an ideology. host: we have just a few minutes left with you. i wanted to briefly, for our , your directake experience and what you took away from their ability to form a government. guest: i think with general casey, he saw the exit strategy for the united states as creating a constitutionally elected government in iraq. obviously, those who ran the elections were always iraqi. what we provided was support for the electoral process, and

the united nations, ngos associated with them, certainly help in the process as well. it ran well, and the iraqi people -- unfortunately, when we look at the situation in afghanistan, the focus was not there like it was with iraq in terms of making sure the elections were fair and executed well. i think we are paying a price for that today. host: raleigh, north carolina, democrats' line. are you there? caller: yes. host: you are on the air. caller: i have a question that is burning me. i do not understand why this representative says he is such a bleeding heart for the iraqis, and yet we have hundreds of thousands of people in america

who cannot even go to the doctor because they cannot afford it, and yet he is opposed to that. he is opposed to any help, and yet he keeps spending about religion. my bible says that charity begins at home, and then spreads abroad. one more question -- if our troops are going to be there, why can't iraq finance it? they can afford it but why do we have to -- they can afford it. what we have to do everything for everybody? host: domestic versus international priorities. guest: i certainly believe in health care reform. i did not believe in the bill passed by congress. i certainly did not vote for that. i think that health care and that america -- health care in america does not provide the kind of access we ought to have to the system. but let's say that those -- my

ideas -- let's save my ideas for reforming the health-care system for another time. i agree with the caller that the notion of nation building we applied in iraq and afghanistan is unsustainable in terms of cost, and is diverting economic energy from the united states that is necessary for our own economy. i will be in a blocking position should this country ever go in that direction again. i do think we need to finish the job in iraq and afghanistan, but we need to do it as expeditiously as possible, and we need to do it in a way that it may be does not fulfill our idealistic dream is going in, but is more respectful of the cultures of those countries.

host: 10 to the iraqi -- can the iraqis paper security themselves? guest: they are paying for this year to force, unlike afghanistan, where we are footing the bill -- they are paying for security forces, unlike afghanistan, where we are footing the bill. but 50,000 troops are left on the ground there. and for some assistance to the iraqi military, that obviously is going to phase out unless there is an amendment to that agreement by the end of next year. host: last question is from michigan, jennifer on the republican line. caller: yes, congressman. i'm a little bit confused. i have a son who his career military so i it supports the military. he was part of the mission to find saddam hussein and i'm very

proud of him. i would not have him any other way. i raised him to be a proud american. he did two tours in iraq, came home, did a tour in afghanistan, came home safe, with posttraumatic stress disorder. no doubt getting ready to go back to afghanistan. what in the world are we going to do here? they are putting us in there and failed, rushed us in there and failed. what can we hope to accomplish with all that -- host: thank you. we will pause there, because we understand the question. guest: first of all, thank you so much for the service of your son. i believe the military today is the most extraordinary this country has had in its history in terms of the young men and women who served in the armed forces.

i think in afghanistan that achieving the level of stability that afghanistan is not used as a basis of terrorism and in a way that would destabilize pakistan. with that said, we superimpose a political process that gave them the government -- i don't think we need to dumb it down, but we need to simplify our role in afghanistan where, you know, they have never had a strong central government in the history of the country, and we need to reflect that. the historically fought -- they the historically fought on the lines of tribal militias and not on military, and we are

supporting militias to fight the taliban. i think it is going to be a very long fight, but i would like to see the bulk of the fighting not done by americans. at the end of the day, it is the afghans who have to win the war for afghanistan and not the united states. host: congressman mike coffman of colorado, a republican, a first term member of congress, a veteran of the army and marine corps, and a member of the armed services committee in the house of representatives is 7:18 in colorado. we appreciate you spending early morning with "washington journal." guest: it is great to be with you. i really enjoyed it. host: we will continue our week- long look at aspects of politics, and our focus this morning is going to be political fundraising we will be back after a news update from c-span

radio. >> here are some of the latest headlines. on the economic front, productivity in the spring fell by the largest amount in four years, while labor costs rose. the commerce department says productivity dropped at an annual rate of 1.3% in the april-june quarter, double the decline originally reported a month ago. labor costs rose 1.1%, the biggest rise since late 2008. the number of people requesting jobless benefits declined for the second straight week, suggesting the slowing economy is not prompting widespread job cuts. labor department says that new claims for unemployment rate fell last week by 6002 seasonally adjusted 472,000. -- by 6000 to seasonally adjusted 472,000. nato says that one service member was killed in

afghanistan's eastern section, and another in the south. nato and local officials say that afghan forces have killed at least 37 insurgents in a series of ground and air strikes. mitt romney is going to headline the republican party of new hampshire's convention later this month. it is the fourth time over the last month that past and possibly future gop presidential as helping party officials in the crucial early primary states. finally, a new "usa" poll says americans think republicans in congress will do a better job than democrats in handling seven out of nine key issues. the biggest divided on the issue of terrorism, where republicans got the edge by a 35-1% margin. republicans also scored well on immigration and federal spending and the economy. more on politics coming up on "washington journal." those are some of the latest headlines on c-span.

>> there is nothing about finance that is like a rocket science. when you think about ponzi schemes, the biggest ponzi scheme for wall street is telling someone who has worked really hard to earn about that they are not smart enough to understand how that buck is going to be invested. >> in 2007, analyst meredith when he was the first to predict losses -- meredith whitney was the first to predict losses for citigroup. she is our guest on "2 n/a." -- "q & a." >> sunday, historian and pulitzer prize winner gordon on "in depth." >> "washington journal" continues. host: all this week we have been taking advantage of the focus on

congressional issues to look at issues in a deeper sense. this week, electoral politics. monday, the 2010 house and senate races, tuesday, political advertisements, wednesday, the role of independents, and today, the issue of money and politics. our guest is kenneth doyle. thanks for being with us this morning. guest: thanks for having me. host: i want to ask you what it says about the state of campaign finance and the law, campaign finance reform, that the principal co-author of the mccain-feingold bill spent $21 million in his primary in arizona. guest: it is reflective of the general trend ever since i've been covering this.

each election requires more and more money for just about everybody running. senator mccain faced a stiff primary challenge. he, unlike some other people who lost their primaries, was aware more of the challenges that he faced, and decided that one of the ways people translate their -- want to show their support is by the amount of money they raise, and the amount of money it takes to spend the sort of at subdue a challenger. i think he just recognize that and recognize that he had to raise a lot of money. he is part of the process that i think everybody is part of. president obama, who also talked about support of campaign finance and other reform issues, raise 3/4 of $1 billion to win the presidency. everybody involved in this

process is raising a lot of money. host: this is more less a primer on the state of the rules that are governing and campaign financing and how they will affect the race this year. we welcome your questions and comments along the way. let me start with their most recent, the supreme court decision on citizens united. all sorts of analysis coming out that it would take the lid off corporate and union financing of campaigns. we have seen a lot of primaries. what is the data telling us? guest: i think the data says, as you just mentioned with senator mccain, that there is going to be a lot of money spent on the fall congressional races, a lot of money spent for candidates, but also a lot of money spent on independent expenditures, which is what the citizens united case involved, the ability of corporations and money to spend money independently for

candidates and grass-roots activities. i think there will be a lot of activity. it may be harder to trace exactly who was spending the money that is going into campaigns, because in terms of specific companies, a lot of the money will go through non- profit and for-profit organizations. -- a non-profit and third-party organizations that don't necessarily disclose all their donors. people are looking at that decision, among other factors, to say that they can spend a lot of money. and people who can do so will be doing that. host: how does the law or regulation group the kinds of different monies that can be raised? guest: well, there are contributions directly to candidates, which can come from individuals or political action

committees. an individual in a company can put it into a pool that they can ies.te the company pacs, individuals, and other sources. because of the supreme court decision, they can come directly from corporations and unions. somebody is saying, i am going to spend my money to help this candidate, but it has to be under the supreme court decision -- and to the supreme court decision and a little bit, it has to be independent -- under the supreme court decision and the law, it has to be independent. host: explain the difference between hard money and soft money. guest: the distinction is a little bit blurred because of the supreme court decision, or money generally refers to individual and -- but hard money generally refers to individual and pac contributions.

the limit for a candidate is $2,400, i think, for electio -- per election. soft money just means money above the limit, and also from sources that are restricted under the campaign finance law. host: in addition to the additional expenditures, under the mccain-feingold law, we saw the rise of five under 27's what are they? what is their role in the election cycle? guest: spending soft money, money above the limits from corporations and unions. there was a law passed in 2000 that required contributions and spending from 527's to be

disclosed. i don't think there is a huge effect from the citizens united decision necessarily on that, although there are still restrictions on what they can do under the old law, what they could do, what 527's could do. i think a more significant activity right now is, among other groups, mainly what you call -- 527 is the section of the tax code for political organizations, 501c4 is for all sorts of social welfare organizations -- the catchphrase -- and money for political activities, and they don't have to disclose who the donors are. that is where a lot of the activity is moving. host: our lines are lighted up here as people want to talk about politics and spending on

campaigns. the federal elections commission. people are counting on them and keeping the records said that candidate -- sso that candidate's transparency efforts can be scrutinized by voters. is the agency fully staffed right now? what is the status of the operation? guest: fec is fully staffed, and it is functioning probably exactly the way that congress intended to function, not necessarily very aggressively. the structure of the fec is unusual for a federal agency. it is divided among members recommended by republicans and democrats, 6 commissioners, three republican seats, three democratic seats. what happens is that you have a fairly wide spectrum of ideology and partisan loyalty.

it becomes difficult for them to agree on things. because you need four votes to get a majority in a six-member commission, would you end up with it is a lot of estimates, 3-3 votes between republicans and democrats -- what you end up with is a lot stalemates, 3-3 votes between republicans and democrats. some people don't want to be too aggressive. they don't want to have politics be over-regulated. it does limit the strength of their enforcement. host: flint, michigan, ron, independent line. caller: i have a couple of questions on big money in politics. why would anybody spend millions of dollars to get a job that only pays $180,000? you think there might be some little gratuities that we don't

understand? maybe it is a power thing. the second thing is, petitioning our government -- my idea and webster's idea of a petition is a document were a bunch of people have an idea and they all signed a document and they send it in for review. this is a great idea, a bunch of us think that. why does it have to be written on $10,000 bills? guest: thanks for your question. well, the petition issue -- that is kind of a vague phrase and the constitution. you are probably right that originally, it was understood as a natural addition -- an actual petition. it has been interpreted by the courts over the years to guarantee the right of people to basically defend their interests before congress. congress thinks it a lot of decisions that affect a lot of

people -- congress makes a lot of decisions that affect a lot of people. they have the right under the first amendment, as interpreted by the court, to go and tell congress, make the case to congress about why you should make the decision in a particular way. that often involves hiring lobbyists to make the case. i think you are correct that it gets away a little bit from the original understanding of the constitution a long time ago. host: why would someone spend millions for a job that pays -- guest: i think there is a lot of different reasons. in a lot of cases, it is not the money. we have examples, it just in this campaign season, of a very wealthy people who are spending their own money to win a seat in congress. i think they would tell you that they feel like they want to

give some of their money back. obviously, there is ego involved, a lot of different reasons. a lot of money being raised and spent comes from interest groups that are interested in supporting a particular candidate that they think will be favorable to their position. i think that is the continuum of the way it has been for a long time. i think the money being raised and spent is getting larger and larger. host: jo, but republican line. caller: good morning, thanks for being on c-span. i agree with the caller talking about the lucrative nature of serving your country. it is a poor motivation, and it has become too lucrative. of the lobbying groups that represent governments, which contribute the most?

what a candidate receives a large amount of money from a foreign government-based lobbying group, how can that person be expected to make a good decision if they are elected? you know, in terms of the israeli-palestinian conflict, if they received an overwhelming amount of money from aipac but not so much from palestinian groups, is there room for bias there? guest: i think i understand what you are saying. there is a distinction i would make a little bit between money that comes from a foreign source, which is very highly restricted under our laws. foreigners are not allowed to make contributions. there is a debate about how much they can spend independently on campaigns.

but i think that if you look at the aipac example, what would find is that those are american contributors and supporters generally, who happen to have interest in a foreign policy issue. sometimes that relates to a particular ethnic or a group that is affiliated with a certain country. there are many different groups that have an interest in foreign policy. but they are generally american. but in terms of whether foreign governments or foreign companies should be able to intervene in our elections, i think there has been a consensus to try to prevent that for reasons that i think are pretty obvious, to protect the countries interest. host: democrats in congress --

the leadership decided they wanted what they called it legislative remedy to the citizens united decision. this viewer -- guest: well, there is a couple of major bills. this would -- the rest and public financing -- there has been public financing in presidential elections since the watergate era, the mid-1970's. there has never been public financing of congressional elections, and a lot of people in congress feel like the ultimate solution to the issues of campaign finance would be to have campaign finance -- public finance, and someone could choose to take public financing of the bypass -- private contra it -- if they bypass private

contributions. there is something more limited and focused on these issues of independent campaign spending and what sources of and senate campaign spending are -- what the sources of independent campaign spending are. the other thing that relates to the previous caller is that the disclose act would have new restrictions on foreign control. we try to define what a four rent-controlled company as, which is difficult, because -- what a foreign-controlled company is, which is difficult, because many companies are publicly traded. but they could not take advantage of the citizens united decision to spend money in u.s. elections. host: where does the disclose act stand legislatively? guest: it fell just short of a

vote to overcome a filibuster in the senate. passed the house in june, i think. there was a vote before the august recess in the senate. it came up short of having a full debate on it, overcoming the filibuster. i think there will be for the votes on it when congress comes back. democrats will try to get more votes and overcome the filibuster. host: next, claremont, florida, democrats' line. caller: good morning. thank you to c-span, and thank you, mr. doyle. listening to mr. doyle and listening to the callers, it is pretty obvious that the only way we will eliminate the corruption and banana republic we have in our government today is to take off financing -- take all financing out of campaigns other than $1 or $5 from each individual, and that includes

corporations that the supreme court designated as full people. taking that $1 or $5. -- they can get $1 or $5. guess what, we would have a country that was no longer corrupt. i would like mr. doyle to tell me, how can the american people take back the government, take back our country, and get rid of this money-mongering that we have of campaign financing? guest: i think your question gets back to what we were just talking about with the legislation for public financing and congressional elections. that is certainly a solution put forward by the people with your point of view, that the way to deal with it would be to have a system where you don't have big

private contributors. the way the legislation would work is you would have a very small individual contributions that would be matched by government contributions. we do have this issue of what the courts have ruled as the constitutional way of individuals, and now corporations and unions, to spend money on elections under the first amendment. unless there is a constitutional amendment, and that is another thing that has been put forward as possible solution by people who think there is too much money in politics -- unless that happens, i am sure a lot of people realize that we have these court decisions and they will be there until there is another supreme court decision that may go another way at some point in the future. host: related to the decision by

the court on citizens united, a viewer from cleveland sent us this e-mail. guest: well, i think that you have to recognize, for one thing, that the citizens united decision was a 5-4 decision. the members -- the justices on the court were very sharply divided about the issue, exactly whether corporations should be given the same first amendment rights as individuals. the people that descended -- dissented argued very strongly that that was not intended by the constitution and not a way to run the country. but corporations -- that are a

lot of court decisions that give corporations a lot of constitutional rights. the majority saw this as one of their things that they ought to be able to do. they have been very involved in lobbying and other kinds of political activities. they have interests that are very affected by what congress does, and the court majority, which is a conservative majority at this point, was sympathetic to their arguments. host: let me put a couple of graphics on the screen. this comes out of the question, what is money all about anyway? these are three primaries where the incumbents were defeated. first, just this week, the concession by lisa kerlikowske. urkowski.. kerlikows

guest: what that shows manley is that money does not dictate every result. there are other issues with -- there is the anti-incumbency sentiment that people talked about a lot in the media. it is reflected in some of these election results. the other point that is more related to money -- the amount raised and spent by the candidates is not the only spending that is going on in the campaigns. in those republican primaries, you saw independent groups --

club for growth in utah, the campaign that defeated senator bennett, the movement in alaska that got involved in helping joe miller. i think that -- there were strategic decisions that murkowski was as she could took back in terms of holding back money -- wishes she could take back any terms of holding back money for the general election. host: rich, you are on the air. caller: my question is about the differences between contributions and corruption -- i cannot square that circle. if democrats get millions of

dollars and week end up with health care reform, and uaw gives $100 million and we end up with general motors, what is the difference between contributions and corruption? guest: well, nobody can give millions of dollars to candidates. they can spend money to support candidates, and they can spend money on lobbying. the distinction the courts made, and people can agree or disagree with it, and this is a major point of disagreement -- if somebody is spending a lot of money to support your paws or candidacy, but they are doing it independently, to what extent are you then obligated to that person? are you potentially threatened by the making another decision -- idem making another decision?

the supreme court in this decision has drawn a strong like to say that the stock dropped -- a strong line to say that that is not corrupt. that is the way they view it. host: taking on the tea party with a pro-union message to " keep the forces of hate from exploiting our economic frustration." just to understand under all the categories of spending -- guest: this is mainly independent spending. unions and business associations and corporations would end up having to do some of this stuff more indirectly then they can do directly under

under the citizens united position. independent spending. the unions will find an effort -- fund an effort, and contribute to candidates through pacs and other things, but will go beyond limits to spend their own money and efforts for advertising, get-out-the-road, can this thing, going door to door, try to identify voters that they can support -- that they can get to support their candidates. tea party, groups like the chamber of commerce, and others will try to do a similar thing, and most of that, if not all that, will support republicans as unions generally support democrats. host: john, independent line. caller: my question is more of a

statement. i don't any corporation should be allowed to contribute any money, because most corporations do not consider themselves aligned with any national country like america or mexico or anything else. they are mostly international. repressions -- it seems to me that there should be a law against corporations could to bidding to campaigns. -- contributing to campaigns. guest: that was a decision and decide very heavily, that corporations are not citizens of -- a part of the decision emphasized very heavily, that corporations are not citizens of any country. i think this will come out in future decisions. host: the language of the supreme court used in the prevailing opinion in citizens united -- "governments may not

suppress political speech based on the corporate identity. no sufficient government, just just by limits on political speech of nonprofit or -- knows of fishing governmental interest justifies limits on political speech by non-profit or for-profit organizations." marianne. hello, mary ann. caller: as of august of this month, 2010, 66 and 2/3% of americans are living paycheck to paycheck. meanwhile, the bankers on wall street had their best month in year. which begs the question -- economic activity happens in america because government authorizes corporations and give them substantial benefits and limitations of liability to the few individuals who owned most

of america. that is the question -- the economy, which government has created, serves the wealthy people who own it, or did we bring into existence, and do we support and maintain it, so that it can benefit the average working person, and that is democracy? what is democracy only involved in politics and not economics? we are down to two things. this is a question we need to ask ourselves. is it commodity versus community, monopoly capitalism versus market capitalism? guest: i think we're coming back to the same issue, the fundamental issue of the supreme court decision, individuals versus corporations and where to draw the line.

corporations cannot contribute to candidates and cannot vote or run for office. there were jokes about some of the opponents trying to run a company for office for the congressional seat. but they do have rights to lobby, involvement in the process to express the political views. i think we have gone with the latest is even farther than ever before towards -- with the latest decision for the than ever before ports enhancement of corporate rights. host: we're talking about how campaigns can be financed under the rules and regulations, especially after this supreme court decision this year, and the congressional attempts to modify it.

all the shia, independent line. -- alicia, independent line. caller: good morning, c-span2 blessing to all of our troops. -- good morning, c-span. blessing to all of our troops. we average joe and jane do not matter any more. rupert murdoch and the like are running our country. the rally on the mall by clan back -- by glenn beck, that was sponsored by the cult brothers, and they make it appear as if the tea party is a grassroots march, but it isn't so. you have to look under the bush nowadays for everything in this country.

the rich, the rich, the rich rule us. guest: well, you know, the tea party movement -- there has been a lot of discussion about whether some of the conservative organizations -- you mentioned the coke brothers, a very large in kansasization that has provided money to conservative groups and causes, and there are seven articles recently trying to trace whether that was instrumental -- there have been articles recently tried to trace whether there was instrumental to support of the tea party movement. these organizations also are a step or two removed from political campaigns. they are support organizations that are ideological and talk

about issues and so on, but could very well have an impact on the political season if the support, for example, for the tea party translates into support for candidates, and looks like it has in a couple of recent examples. whether you can say that is because of a particular person or company supporting it, and that is fundamental to it, or whether it was the people out there on the mall, the rally, i don't any of them were paid to be there. they might have taken a bus ride for free or called by an organizer, but i think the fact that they were there to present their point of view. host: staten island, republican line. caller: mr. doyle, just as a

quick aside before i get to my point -- for the last 30 years, as in it and the democrats but with a multi -- hasn't it been the democrats who were the majority of multimillionaires in congress? they confiscate my dues money and spend it on political campaigns, mostly for democrats, 98% of the time, without asking me in advance, without saying, "mike, can you spend this on mcmahon in staten island?" no, i don't like mcmahon. you don't want to let corporations spend money? i'm confused. are you forced to be a member of the corporation? no, but you are forced to be a member of the union. it looks pretty good.

they have their little houses and private jets and fly first- class. they really care for the working man, but don't bet? h -- don't they? guest: it is important to recognize the unions under this decision have the same ability to spent on campaigns, and that is a good example of been a unin that is spending a lot of money on the campaign. they have the ability to take money from members' dues and spend without necessarily polling all members to decide where they are going to spend it. they are in a similar situation. some of the unions were happy with this decision because of the increase the ability to do it. host: can you very quickly, because i have calls to get in, but the major bullet points of the mccain-feingold law

following the supreme court decision? guest: the main thing is contributions. the supreme court affected independent expenditures but not contributions to candidates. a main element of mccain- feingold was to end soft money contributions directly to political parties, and that remains intact, although it is still being debated and challenged in the courts. back to be the next big case before the supreme court. -- that could be the next the case before the supreme court. host: democrats' line. caller: here is a concept -- free air commercials for all qualified candidates. how about that concept? that would get rid of all the bickering and the viciousness about unions. host: ok, to discuss your

question -- guest: my recollection of that part of the act, the voluntary financing bill -- i think the way the work is to give vouchers to candidates to use for air time -- host: how does it work in society where people are increasingly using the internet for news and candidates getting on youtube? is free air time having the same effect -- guest: it may not be. most of the spending is going into tv commercials, but there is a lot of resistance to that, and a lot of it comes from broadcasters, who get paid a lot of money by candidates and groups around election time, and to resist this kind of thing. they also make the argument that viewers don't necessarily -- that is not necessarily what

they want to have on tv. not everybody is interested in watching political debate and discussion. host: republican line. caller: good morning. my question is why is obama giving all the money to the unions? why he is he in their pocket? that is what i want to know. guest: well, i think that is a good question. you have differences of opinion may be from some of the union's with some of their major priorities that they have not gotten through yet. but clearly unions are major supporters of democrats. when democrats are in majorities in congress, the unions are in a better position with their legislative agenda. legislative agenda.