on one hand, you could say there is all this protectionism and protectionist fever and not the leadership to stand up to it. on the other hand, you could say, people understand that we cannot ignore china. we borrowed a lot of money from china and the chinese and the indians are getting kind of competitive. you can imagine not having -- we cannot afford to ignore the rest of the world. it is a bit schizophrenic. on one hand, we know we are so tied into the rest of the world that we are afraid of japan. there is this kind of, if we build a wall and keep up their goods, we can do better. that will be tough to manage. you have to adjust its cyclical.

i was more worried when we had a lower unemployment rate. not surprising now that there is. i do not know -- i do not see any of the end for the standoff between the u.s. and china over the exchange rate. it is not hard to imagine that it will get worse before it gets better. the economic equivalent of the chinese taking the -- cutting not rare earth exports to japan. these people are really playing with -- i am very close -- they're very close to throwing things at each other. it may take a confrontation like that before they come to the table. there will be a lot of innocent bystanders. >> ok. there are of least two more here. if we could bring a microphone down.

>> would you wait for the microphone-please -- would you wait for the microphone, please? >> my question is, if there is an impasse in congress, what does the president passed -- have in terms of alternatives? do you think jolie probable that he will go from that point -- what will it mean in terms of the world for the international agenda? >> he can continue to appoint people to regulatory agencies and tried to have the bureaucracy carry out his agenda. as past presidents have done. an obvious example of that

would-be cap-and-trade, the epa couldn't -- cracking down on greenhouse emissions. is cyclical state of the economy, they cannot do much. that is where we come back much more to the federal reserve. i think it is a good sign that the fed is talking about doing more. they have been behind the curve on that. they spend too much time worrying about inflation. i think you get into a situation where the fed becomes much more important. the fed is not willing to act in the final weeks of the election. i assume we will see them doing more. >> i think that is right.

more reliance on monetary policy and fiscal policy. they can have side effects as we have seen. i do not think -- it makes it hard to get on popular things through the congress. that the world might think is a good idea. i cannot imagine how anybody outside the united states can make any sense of what our policy is given that nobody inside the united states can. i would imagine there is a period of great confusion. every once in awhile, you hear some american officials said, the parliamentary system has a lot to say for it. i heard that during the crisis when the european countries would do a lot of stuff in a hurry.

i think the rest of the world is in for a rocky ride. >> i find it interesting that -- what happened to the anti- esthetic movement? maybe it is too complicated for people. but is hurting a taboo category. that is senior citizens. the fed's strategy right now has senior citizens on fixed income and they're making nothing on its bread -- on it. nobody is ringing the alarm bell. >> i thought you were going one way and you went another way. the anti-fed thing has quieted

down a little bit. when you look back on employment, -- when you look at unemployment, you can see how people come to that conclusion. i cannot answer the question why there is not much of -- mach more of a rebellion. the bar words have been -- the borrowers have been enjoying refinancing. it is a good point. it really shows up. i do not have a good dancer. -- i do not have a good answer. >> i will risk a little

generational war. as a group, i am not surprised that they're not angry. they did not have much to be angry about. they got to really benefit from this huge run-up in the american real-estate and stock market. it is something that the younger generations will not get the benefit from. i do not know if that explains the lack of outrage at the fed. to me, if you'll look at different groups demographically, a senior citizens are the ones i would worry the least about. we would never do anything to harm people. they cannot alter their plans the way a 30-year-old can. dealing with the deficit is not going to --

>> it may just be that it is drowned out by the words of other things. if you are worried about losing your job or your child a graduating from college, if your health care is tied to your company, low interest rates may not be in the top 10 list. we have so many other things to worry about. >> kentucky will continue to have the anti-fed senator. >> last question is off of the card. i will read it. >> i am not sure i like the sound of this. >> from the perspective of top shelf economic journalism, it does academic economics have much to offer in these times? you can see why i read it verbatim.

[laughter] >> my answer is, yes. look, the academic economic community was in part responsible for some of the misunderstanding that we have of this crisis. but it is also responsible for some of the great insights that we have had as to why it happened. having a fed chairman you has a bit of an academic background and has proved beneficial. my guess is that whatever you think of larry summers, that we are better off than he was in the room. that is not to denigrate. you would not want a whole bunch of academic economists try to figure out what is happening next quarter.

it is a bit -- >> you need both. they both have their strengths. the two biggest ranks of academia are among the two biggest are the interest in taking a lot of time and trying to rally, but the right answer that will withstand rigorous and time. sometimes that approach really helps things. trying to come up with whole new ideas and theories. one of the nice things about academic economics is that it has tried to get more real world. they had taken a theoretical and tied to the real world. if you rely only on academics, not only would to be horribly wrong, it unfolds so slowly. right? journal articles come out so slowly. the desire for rigor often means

that you are analyzing things years after they happened. we both have had experience with outlets like global insight in which you're trying to figure out what is going on with the chinese auto market and four minutes later, you have a spreadsheet in your e-mail. >> if you ask alan greenspan, how did you miss the rapid rise of subprime mortgages? he tells this wonderful story about cindy numbers from a mortgage finance. it showed a big increase in 2006 in the number of subprime mortgages. we're talking about a guy -- he is a global in such kind of guy. he said that he did not believe the data. he said he did not think it was possible to have something increase that rapidly. what have the things that the policy makers have learned is that it is exactly when -- there are times when you really need to have the data to figure out

if the story is not unfolding as you expected. a whole lesson learned from this episode, the whole business of supervision is to spend less time thinking about how we can trust the markets because the markets always do what is in their interest spread a little more time on looking at the data to make sure that allows for the possibility that these guys to run these big banks, they might not actually know what they're doing. in retrospect, a lot of academics got it wrong. a lot of wall street got it wrong. the data got it right. >> thank you. please join me in thanking david and david. [applause] i need to make a couple of quick announcement.

please fill your evaluation forms. we take them very seriously. dinner is downstairs. we will start loading the boat around 6:00. it is downstairs at the atrium, and outdoors. find it -- all the red brick path. it is about a five minute walk. we are looking for the odyssey cruise. it believe that this o'clock 30 sharp. >[captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] >> at 7:00, the televised debate between pennsylvania senate candidate. in about an hour, a profile of the indiana at 9 district house race. at 9:00, president obama is in nevada with a rally for harry reid. that is followed by the third and final debate between

wisconsin senate candidate. >> local content of vehicles are traveling the country as we look at some of the most closely contested house races leading up to this of members midterm elections. -- november midterm elections. >> it has been a very interesting race for the sixth district congressional seat. through the primaries, both parties were highly contested. both of the nominees won by the slimmest of margins. this has been an area that has been dominant lead democrats and now he looks like it may go republican. it has been old-time southern politics. stand on the street corner and hold signs, kissing babies, shaking hands. >> i am running -- i was over

here on the square one evening i die harassed everybody. -- and i harassed everybody. i am not very good at staying on message, i guess. >> thank you. >> dianne black, she is the state senator. she knows politics. she has been around. she is a former nurse. she has been able to use her medical background to appeal to the anti obama-care. she is somebody who is a mom and a grandmother, down to earth. a person that the voters can really relate to. >> i think the government is spending too much money. they are getting into places

where we think they should not be. they are taking over health care, cap-and-trade. government stock, slow down, don't spend so much. >> brett carter is an unknown. he was a military man, he was be at issue and to win. all the seventh quarter, as anti edges and for the nomination. people were at attracted to his down-home appeal. he has been a very plain spoken. he does not to be seen -- he does not seem to be a politician. he is just your average joe, talking to everybody. >> i think the people of this district are tired of career

politicians. they want some new faces in washington. i have an accounting degree. i am a veteran who will stand up to the special interest to are doing things that are making our economy -- stopping our economy from being turned around. >> the district itself is several counties. cookeville is the hub. 14.5 counties are included in the district. when he decided that he was going to retire, it was pretty much a given that a republican was just going to take over a seat in house. i think you take somebody like carter, who was not a politician, and u.s. not been involved in politics, but says, i am a democrat.

i think i will go ahead and at least try to keep this seat a democratic seat in congress. carter and black are trying to disassociate themselves with politics in general and with washington. they are running on a platform of when they go to washington, they will not be part of the washington regime. they will try to make a difference for our area. they are both very similar and a lot of things. carter had a press conference asking for nancy pelosi's resignation. he is trying to disassociate himself with the washington democrats. he is focusing on the issues that people around here care about, like jobs, obama-care. dianne black is certainly against that. she wants to reform the health care all over again.

carter is talking more about the economics of cutting taxes, a decrease in spending. they agree on a lot of things. he did not hear a whole lot of back and forth between them so far. we are not privy to a lot of polls in this area. dianne black has to have a 10 point lead. carter is definitely the underdog and he knows that. he relishes that role because he came out of nowhere. there are not a lot of people who know him as well as they do her. she was in a very nasty primary race with some other republicans, you have to wonder, is that party -- had they come together now? it will be interesting to see who wins. >> the local content of vehicles are traveling the country as we look at some of the most closely

contested house races leading up to this november midterm elections. for more information on what the local content vehicles are up to, does the our website, c- span.org/lcv. >> just a reminder of our campaign coverage for tonight, starting in about 10 minutes, would the pennsylvania senate debate. that is live coverage. earlier, we spoke to reporters today about campaign spending. >> democrats are holding on to the house by just a thread here. they think they can spend a few

more million bucks, that they can hold on to the house for democrats. >> $20 million figure is what they're going to be spending in advertising? >> it is not as much advertising as get-out-the-vote efforts. overall, they are spending nearly $90 million on the entire election. they are ramping up a last- minute push here in the final week to try to hold onto some tough house races. >> is there anyone big contributor? >> no. they get their money's from small contributions. their annual dues are a little less than $400 a year. they take that money and bring it to their budgets and they take a portion of that and devoted to politics. >> your story this morning reporting about the biggest

nonparty spender. the figure is a little different in "the new york times." what is the discrepancy? >> the difference is that the journal was looking at a broader definition of political spending. we include everything spent on politics. "the new york times" story is just about television advertisements. for a group like the chamber, it is a big portion. the chamber plans to spend about $75 million on the election. some of the other unions are spending more than the chamber, some less, to run ads, but the benefits of the union political effort is that they go to their members and persuade their members to vote usually for democrats. their effort does not have to be

disclosed in the campaign cost. >> your story shows a nice craft as to where the spending has been over the last few years. >> it is a huge increase. >> is that similar to other unions as well? >> no. they have really ramped up in the last decade. some of the other unions had been on the pace to increase, but sort of dropped off this year. they are spending about as much as they spent in the last couple of elections. in campaign spending, if you are not going up, you are going down. >> but all is said and done, will this be a record-setting year for individual donations for campaign donations? whether it is to organizations or the chamber of commerce? >> it will be, but the secret

in campaign finance circles is that it is always a record year. >> who will come out a winner in terms of the amount of dollars? the democrats are the republicans? >> it seems pretty tight. there are several different pots of money. democratic candidates are winning in the amount of money raised by candidates. among the political parties, democrats also seem to be winning. among these outside groups, republicans seem to be winning. >> thank you for joining us. >> thank you for having me. >> here is our lineup for tonight's debate and campaign coverage. live at 7:00, the second and final debate between pennsylvania senate candidate. in about an hour, indiana ninth district house race. followed by president obama is

in nevada with senate democratic leader harry reid. finally, the debate in wisconsin senate race. theet's begin with pennsylvania senate race. the two candidates in their already debated earlier this week. how did the voters react? guest: you saw both of the people paint each other out of the mainstream and that is a lot of narrative and attack that has g gotten sestak with traction. he was attacki ining taoply for business ties and working for the club for growth in washington. toomey tried to argue that sestak's votes on stimulus and healthcare and the democratic congress is what is making the congressman out of the

mainstream. it is a battle for both sides. you look at the new polls from pennsylvania, you see that the democratic base has come home. they have overwhelmingly decided to support sestak. toomey has an overwhelming support from the republican base and this will be decided by independent voters who are debating who is more mainstream and reflective of my values. you look at the quinnipiac numbers, they favor toomey by over 20 points. so the argument of who is more mainstream will be played out in the elections and 20-plus-point lead for toomey is good for him. we will see the messages attacking each candidate as extreme in the coming final weeks. >> the two also are going to have a debate tonight. we are covering it live on c-span. what do you expect to be the issues tonight? >> i think you will hear a lot about trade and china from

sestak. the one narrative we are hearing from democrats across the country especially in blue color states and districts is that the trade message is the only thing they have left. the notion that republicans are businessmen and favor business and will be responsible for the mess we are in. you saw sestak talk about toomey favoring outsourcing jobs to china and he will probably hammer that home tonight. but the mental for the republicans -- the message for the republicans is simple. they will try sestak and to his votes and stimulus is not popular in pennsylvania. healthcare is not popular and the financial reform bill is not a plus. so it will be an issues oriented messageor toomey and attack from sestak on business, china. host: that is live tonight 7:00 p.m. we are covering this debate

between the pennsylvania senate candidat candidates. let's move on to nevada now. president obama will be in that state tonight for a rally with the senate majority leader harry reid. why is he going there again? >> nevada is one of the states where democrats feel if they can get the base energized and labor, public sector, hispanics which comprise a pretty decent size of the electorate there, if they can get them excited about harry reid he has a shot at winning. if not, they are in deep trouble. this is a race where democrats absolutely need to get the base rallied. on the other side, this is a very polarize iing election and sharon angle's election is a national one. they have the highest unemployment rate in the country, she is out with a really devastating hit connecting reid to obama. so, ironically the mental that

the democrats want is the same message that sharon angle and the republics. it will be a very close election. but the base of both sides will be the key. host: the latest poll on october 18 shows that sharon angle is leading harry reid by three points. >> yes, if you look at the most recent polls there's a slight momentum to the republican though i would caution that this is still a very close race. both candidates are very unpopular and this is probably going to be one of the closest races we see election night. the big turning point looks like it could be the debate last week, the one debate they held in this contest where harry reid, for a senate majority leader looked awfully unprepared and ill at ease. that was his one big advantage is he knows how to bring the money home to nevada. he has a lot of clout in washington. he didn't look like it in the