the center of college affordability and productivity. this is "washington journal." [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] host: on the front page of "usa today" this morning, tea party seeping into u.s. fiber. polls show people divided on who should direct policy. today is tuesday, november 23. in an article by susan page, she begins by saying -- in a sign of the tea party's growing clout, nearly as many americans want members of congress a line that the emerging movement in setting policy next year as those who prefer president obama, this according to a "usa today/gallup" paul. you can weigh in on the topic. the numbers are on the screen.

if you called in the last 30 days, today would be the day to send an electronic message. the addresses -- more from the susan page article in "usa today" this morning. a 20% of those surveyed said obama should have the most influence on government policy, while 27% say tea party standard vendor -- standard bearer should. 27% of those polled say the tea party should have the most influence over government

policy. a 23% say congressional leaders, 16% said democratic congressional leaders and 28% said it should be the president. we want to see what you have to say on who should have the most influence over u.s. government policies. our first call comes from new york on our line for republicans. adam, you are on "washington journal." caller: in any election cycle, i believe that the people should always dictate where this country should go and i think this is a really -- that obviously does not always occur. and i think this is a great example where the tea party influence has captured that. and therefore i believe that the tea party should and will influence the direction of legislation, where this country should go. and specifically if you look at

the contract from america where i believe there were 300 candidates signed on this contract from america where there were various ideals that they will be pushing for, one of them i believe was true fundamental tax reform, tax code replacement, the federal income tax code is sucking the life out of american and therefore we should see a lot of activity towards that and also the other items i am sure on this list. host: are using a lot of influence of the tea party of where you are? caller: i am one of them. host: pennsylvania, on the line for democrats. who should influence government part receive the most -- the president or the tea party? caller: i think as the constitution says, all three branches fairly and equally.

it looks as though when i saw the poll numbers that the majority of the people say republicans but out of the republicans, it looks like the tea party is stronger actually then what would be the establishment republicans. it looks to me the republican party is going to far to the right and i am hoping the american people will see what -- the tea party for what it is and i hope the american people understand -- have common sense and understand we need stability and we need to move together as a country to move forward. if we -- but 2012 will be devastating. i fear for my children's sake that people are not going to do what they need to do in washington, and therefore our country is going to go into an area of -- that will be stagnant

much longer than what i think people understand it is today. host: vance on our line for republicans. oklahoma. caller: what i think. i think coming up in about june of this coming year, there is going to be a big train wreck over raising the debt ceiling and the tea party is going to have a lot more influence as that date comes up. now, if the tea party remain strong and some of the media figures, maybe glenn beck and others, really rally the troops to get together and really march on washington and say no raise in the debt ceiling, i think then you will have a precipitous moment in the history of this country went -- when the government credit card can really be cut in two and all of

the powers that be will just be screaming bloody murder and over that. but i tell you what, that is what is going to have to happen. we are going to have to cut the government's credit card in two. yes, there will be a spike in interest rates. yes, the bond ratings will just go to nothing maybe, but that is exactly what has happened to put a permanent end to deficit spending because deficit spending is taxation without representation. host: more from the susan page article in "usa today" this morning. she writes --

lancaster, pennsylvania. caller: excuse my voice. the tea party is the equivalent of the know nothing is from 1843 until 1850. and the real thing that needs to get out of the swamp, we have to do campaign finance reform and get the money out of the other campaigns. otherwise we are headed down the toilet. host: and this particular instance with regard to campaign finance reform, who will have the most influence, the president or the tea party? caller: that's a tough call. i would say the president. of the tea party people are just

tools of the big money folks. you saw it in the last election. at host: on missouri on our line for independents. ,aller: i am a cancer patient and i am just really concerned about the cuts that they made in medicare and medicaid. vital for americans like me. if i didn't have medicaid insurance program, i don't know what i would do. i already lost everything pretty much from the bills and everything. i am just concerned about tea party rhetoc that i hear, and the republicans, too, making deep cuts in these areas. host: more from the article. is susan page write s --

back to the part of the article that talks about the numbers. 28% of those surveyed said the president should have the most influence over government policy, while 27% say the tea party standard bearer should. the gop congressional leaders should have 23% and democratic

congressional leaders, 16%. according to this poll that is on the front page of "usa today" this morning. frederick, maryland, on the line for democrat. dn? caller: it is ian. caller: i am sorry. caller: i would like to say, but i am really upset about these little holes we have going on. it is like rupert murdoch owning 8% of the press. he owns fox news. there are a lot of us out here who voted for obama and when we hear stuff like this it sounds like subverting democracy. host: why does it sound like subverting democracy? caller: very powerful interests have the microphone. if you guys doing blanket

coverage of the tea party. nd koch brothers, big oil. they got us up on oil all these years so we are dependent. what did bush say? that we are addicted to oil. because they give us no alternative. jimmy carter -- ronald reagan toward the solar panels down from the white house and said take it to but garbage dump. ever since then, big oil have been telling us what we are going to do and that is not democracy. host: moving forward with regard to energy policy, do you think it will be the tea party or the president that has the most influence on how the government operates? caller: i hope it will be the president because we voted him in. i was complaining when bush was in all this and i was told i had to shut up and support my president because i was a traitor and those are the ones who are really on obama.

host: who should have more control over government policy, the president or the tea party? chase, turn your television down and you won't get the feedback and the process will move a lot smoother. caller: i actually think the influence should be shared. the tea party represents some portion of the country. and the president represents the electorate. a guy earlier talk about obama care. it does not necessarily need to be repealed, it needs to be redone. i am a health insurance agent, of dumping people into a broking system is not a way to fix it, fix the system. talk about energy. we have enough oil of our own as a result of the katrina spill -- bp disaster, smartly with correctly with proper safety

measures, we have enough oil to power as into the next century. why are we dependent on foreign oil? host: let's move on. we got it is urgent message from the apa, -- ap. out of seoul, south korea. it two marines were killed and 16 other that injured after a bombardment on an island at the disputed western border. they returned fire unscrambled fired jets in response. instead, the new main attack on civilian areas violated the 1953 armistice halting the korean war. the skirmish came amid high tension over north korea's claim that it has a new uranium enrichment facility, and just six weeks after north korean leader kim jong il unveiled his youngest son kim jong known as his heir apparent. other items regarding career.

this item from "the wall street journal" with the headline -- north korea nuclear find raises fear on tehran. but washington is the deadline. no. 3 of's apparent upgrade is raising fear among lawmakers -- north korea's apparent upgrade it is raising fears among lawmakers about their role of supplying iran and others. also, in a related story and "the washington post" this morning, iran's nuclear program is said to be troubled. it it has experienced a series problems, including and explain

the fluctuations of the performance of thousands of centrifuges -- back to our phones and a discussion over influence over federal policy -- the president of the tea party, who shed the most -- who should have the most influence. carl on airline for democrats. missouri. caller: i am calling, the gentleman who talked about the polls before, he was bought on but i would like to add something. i would estimate about 40% of americans think obama is muslim and about 45% think he was not born in america and about 50% probably think he is a columnist and for one thing obama is not left. his policies if you look and analyze them, they are not left at all but about 50% think he is to left. i am from missouri and they did

a referendum and they are saying americans don't support health care because 70% were asked do you want to be forced to buy insurance and a question like this you are going to say, no, but if you say you want freedom distance covered most people would say yes. -- what preconditions' covered. the media is doing a horrible job of debunking but lying that are ruining the thing. host: mansfield, ohio, on the line for independent's. caller: i think that tea party is basically the bully section of the republican party. i think they do have a lot of power. but i think it is controlled by big money. thank you. host: in this op-ed piece in this morning's "baltimore sun" david wise writes under the headline, the audacity of hypocrisy. republicans are attacking president obama for some of the very positions and policies

their party recently embraced. he writes in his book, what it's a matter with kansas, thomas frank describes how conservatives use social issues to divert attention from other issues and drum up popular support for conservative causes.

back to the phones. our discussion on the influence over government policies. who should have more influence -- the president or the tea party? sterling, virginia, gary on our line for republicans. caller: thank you for taking my call. most definitely the president because he is the one who was elected. but what i see happening in a lot of developing countries is a veering towards pretentious

consumerism and ideological militant industrialization, sort of the same path we took which has brought us all of this well that we are experiencing right now. neither of those things -- consumerism or industrialization has contributed to and the advancement of mankind. the three biggest problems i think we are facing as a world our population, energy, environmental degradation -- and one other thing. about homosexual rights, you know, it is just like they should have the same rights as everybody else. the stigmatizing the children of homosexuals, that does not american because, you know, children will brag on their parents, they will be on the playground or parking lot -- host: we will leave it there. florida.

walt on our line for democrats. it caller: thank you for taking my call. it definitely the president, working with the legislative branch. the major problem we have right now, though lobbyists and the chamber of commerce as too much influence on the legislative branch. they need to do the work of the people. and also they should take into consideration that we are dealing with a global label -- we have to figure route how to figure into the global label job market. but the legislative branch needs to do their job for the country and leave these co-ops, the lombard -- lobbyist and chambers commerce. host: in "the guardian" the headline across the top of the

paper, i rise bailout and in turmoil. now europe fears crisis was prepared portugal -- portugal and spain may require eight. you can read that at guardian.co.uk. st. bidders were, florida, on the line for republicans -- st. petersburg, florida. caller: the people vote in the present. the president should most definitely be leading the political country. host: a lot of the house of representatives on the republican side were voted in by tea partiers. caller: i understand that. but the president had had his resistant with the population, and listen, just be quiet and allow him to finish out what he started.

i am almost certain that he will be more -- much better off. host: arcadia, florida, on the line for independents. caller: good morning. host: good morning. caller: definitely, we the people are going to have the most influence. at the last election was definitely a referendum for the country and president against the president and his policies. the people were trying to recapture their power. i referred to a couple of things. the poll that was taken prior to the election when inside the beltway people were asked one question, it is the country going in the right direction. 60% said yes. outside the beltway, the rest of the country said 80% now, no, it

is not going the right direction. statement by the constitution -- governments are instituted -- derive their power from the consent of the people. host: this twitter message we got -- she writes that the day that would let the minority groups such as the tea party determine policy is when our democracy is dead. we elect presidents, not groups. what do you think about that? caller: well, we had clinton elected by a minority both times. he never got a majority of the boat. even though it was -- first time it was 42% of the vote, a plurality, and the second time, it was 49%. there has been a lot of fracturing of society and divisions with this president's,

however, the people will get it together, they will have a candidate and come back strong and we will get our country back. host: stories in the paper regarding travel in this thanksgiving week. the lead story in "the washington post," most support full bar these scanners. have coffers being interested. secretary napolitano defends airports remembers. also, no immediate changing in the tea s.a. screenings. this is a story and "usa today."

also in the papers this morning, t essay says few passengers -- and alabama, david on our line for democrats. who should have the most influence over government policies, the president or the tea party? caller: i think it should be the president and the one way he could do it is by being the commander in chief like senator kyl and arizona, he could transfer all of the military personnel in arizona to other states and shut down the economic military engines in it these republican states like mitch mcconnell in kentucky, shut down the big ford by just transferring everybody out and

sending them new orders to other ports around the country and let the republicans have a little bit of suffering going on. that is what i think. host: north carolina is what -- our next call. ralph on the line for independents. caller: it is a pleasure, for the first time. i think the president should be the leader, working in conjunction -- i am not sure about the tea party but members of the house. and if i can digress a little bit on these obamacare -- do you mind? host: well, we are trying to keep the conversation -- a conversation with regards to influence over government policy so we will move on to georgia on the line for republicans. ed, you are on "the washington journal." caller: i do know the voting districts will be redrawn says

the republicans won a sweeping victory across the united states, and the democrats can possibly take the house until the next 10 years because that is when they do -- the next census will be 10 years from now. the chances of the democrats taking back the house over the next 10 years is practically nil. the president has influenced up until january, and then after jan. he is going to have to start cutting the budget there is no influence by the -- of the tea party by big money. i am member of the tea party and i work every day until my hands are bloody and nobody gives me money. host: thank you for your call. ed in georgia. in "the new york times" this morning, the lead article -- taliban leader in secret talks was an imposter. unmanned reporting to be the insurgent #two got western money.

fort myers, florida, on our line for democrats. teaneck, you are on "washington journal." i believe the president should definitely be in charge. he should have more help from both parties.

democrats didn't exactly go along with him the past couple of years. and if the tea party people believed that they are not being manipulated by big money, then i guess -- therein lies the problem. most people hold -- who voted the people who are in, are totally oblivious that all of the big money through the chamber of commerce, just large, other organizations, by the same people who were in power prior to the past two years. host: of teaneck, we are going to leave it there. in the editorial section, the op-ed section of "the philadelphia inquirer." democrats showing this still don't get it. in the house, they endorsed a

discredited regime. back to the phones. texas, diagonal line for republicans. who should have more influence over government policies, the president or the tea party? caller: i think the president indeed should have the most influence but on the same token i don't understand this antipathy toward the tea party.

it is very difficult for most people who are not involved in the tea party movement to understand that it is not manipulated by some puppet master with bags of money in fusing it. it is definitely a grass-roots movement. it was the people who got together because they got tired of not being represented by lobbyists, unions, they did not have any voice. therefore, we banded together. and maybe others now want to attach themselves to the party, but it was definitely a grass- roots movement. host: are you in the tea party? caller: yes, i am, and i am a proud member. it is just individuals who care about the country, who care about the future and a path that the country is on. host: how do you plan on exercising your influence in the

coming year or two? caller: by voting. and i call our congressmen and express my opinion, as i always did. host: who represents -- a goal ralph hall. host: you think your influence with -- is what got him elected or reelected? caller: i should keep my powder dry on him, but he has been in there too long. i don't know if the tea party officially supported the man peak who was opposing him in the primary, but he didn't win. host: in "the philadelphia inquirer were" more news from texas. doa jurors began -- delay jurors begin deliberations.

back to the phones. palm coast, chop on the line for independents. caller: thank you. thank you for c-span. i think the tea party should have more influence over policy because of what we have is an illegitimate federal government. the federal government has -- the set up is not constitutional. we are not represented by these "leaders" leaders and self-

appointed leaders. the u.s. senate is there to represent our state legislatures and governors. but congress, the house of representatives, is there to represent their constituency out there in the field. and when they go there and they say that they are the leaders, we don't need leaders. the people are the leaders. i think it is sort of a moot argument to say that somehow the president is in charge of -- anything. his job is to make sure the policies as our states decide are followed through on and to keep our country safe. he has a chief executive position. we have governors, with a 10th amendment. nothing should happen in our program and unless a majority of states through their state legislatures have put forward a problem that needs a national

solution. the national government has totally use allowed the states. and when we get our state back in charge of our federal government, then we can allow the tea party to be represented by the proper representation. we don't have proper representation. corporate america owns our government. host: in about 10 minutes we are going to be talking about the role of the federal reserve with david malpass, former deputy assistant treasury secretary and former deputy assistant secretary of state. that conversation is coming up in about 10 minutes. california on our line for democrats. jeff, go ahead. vista, sorry about that. caller: that's ok. when i heard somebody call and who said the tea party was not put together by large money interest i practically fell off

of my chair. i don't really think that the people who say that even a believed that. but here is how it goes. host: why not? they seem pretty sincere. caller: of course. everyone is sincere. i voted for obama. i am just a little guy. i am sincere. it is not these tea party people who are sincere and everybody else is not. i also, by the way, the whole disinformation campaign gets to me. i looked on my birth certificate. it doesn't say birth certificate. it said certificate of live births. does it mean i was born in kenya? host: what else does it say on your set to begin of live births? caller: the fact -- as my name but, it has -- but what i am saying is -- host: does it have the city and state where you were born? caller: yes, it does.

it does obama's say kenya? host: i believe it says honolulu, hawaii, but i have not seen it. thank you for your call. the lead story this morning in "the washington times," gop senators said its new intel and will not support new start treaty. there is also a letter in this morning's "washington times" sent to senator kyl from americarussia.net. an open letter to senator kyl.

your voice can account for more than one and in fact decide the outcome of an issue critical to u.s. security and u.s.-russia relations. several republican senators indicated they will be guided by you in voting on start ratification, thus putting all burden of responsibility for making a historical decision on you. they go on to write to senator kyl -- while this is in your procedural prerogative as a senator and a matter of your colleagues respect for your judgment, we respectfully suggest you reconsider your considerable influence in this matter. back to the phones. columbia -- i am sorry, kansas city, kansas, is our next call, on our line for independents. caller: how are you doing? host: go ahead.

your colleague from kansas city, kansas. what do you have to say about the influence of the president and influence of the tea party? caller: there is supposed to be a change. obama talking about a change. and for the american pete -- the people, we voted obama into office. so, obama, he is one man. he's got his hands full. so why not give it back to the people? host: thank you very much for your call. next up is columbia, south carolina. tricia on our line for democrats. go ahead. caller: i keep hearing this statement, we want our country back. i want to know who the we is an country back from home or from where? thank you. host: moody's think the we is that they are referring to --

who do you think? caller: i am not a supporter of the tea party. i am an american. i vote. i am interested in how the country is run and what the politics dictate. if you would get the impression that the tea party people are the only people who are interested or are the majority or the only ones interesd in the country and what they see is what the direction the country should be going. there are other views, other voices out here. i think the media gets into the fray and advisedly very often. this poll this morning, who should have more influence, the president or the tea party? what kind of question is that to ask? i think the media does a great

fourth those questions unformatted in such manner as that. host: and we will leave it there. more about a possible vote on ratification of a new start treaty in the senate and the influence that senator john kyl seems to be having over whether or not the boat moves forward. in "the wall street journal" this morning, this editorial. the nuclear treaty rush. republican john kyl is being kicked around for saying he doubts there will be time to ratify the treaty this year.

also this morning in "usa today," this article -- why nuclear arms treaty will likely pass lame-duck session. despite public claims it will not happen, there is a very good chance the senate will approve the treaty during the lame-duck session.

indiana, pennsylvania. josie on the line for democrats. caller: thank you for c-span. i am calling because the question, which policy should be followed, the tea party or the president, i think is an innocuous question. obviously the art of politics is compromise. rather than trying to promote division, we should promoting people coming together. the tea party is very well organized and funded. but there are people out here in the hinterlands, and i live in the hinterlands, who are very sincere about bringing good changes to government. when i hear as a former teacher people calling in and being ignorant of the constitution, saying things about the constitution that aren't in it. that we don't have a federal government that is properly set

up. i would need to ask them to please go back and review that, go back to their ninth grade civics classes and a look at what the competition does say. we do have a division between the federal government and the states. i would also remind those who are so adherents to the tea party that george washington threatened to mount his horse and ride here into western pennsylvania to put down the whiskey rebellion to ensure that the federal government had that power over the states when it came as to tax and show his authority and that was very early on in his administration. host: we will leave it there. later on in the program we will talk to ivo daalder, permanent representative for an vast -- or ambassador to nato. talking about the future of nato. there is an editorial about "the financial -- from "the financial

times." our last call on the subject of who should have more influence -- or the most influence over the government policy, the president of the tea party, comes from baltimore, maryland. go ahead. caller: i wanted to second person who just called in before. i agree 100% with what she said. the question is invalid. it is a shame you presented as a real valid question. president obama was elected to office. the tea party is just a group of people. to compare them to an elected official is not even a fair

comparison. i think it is a shame that the media started to take the stance -- instead of debunking irrelevant arguments, entertaining them and adding fuel to the father for those situations. h., the people who elected -- who supported those tea party candidates would save that they have a legitimate right to be heard and express their opinions and that this discussion does have some legitimacy. caller: i think so far as that goes, but the most recent election, the argument is still being only framed in the sense that the tea party mandate came in. that is not what happened. what happened is the democrats had a some really strong support system in the beginning and when they got into office they did not take advantage of it. instead of them pushing through the legislation they said they would do and the policies, they sat back and decided to politick and debate about it and it turned off people who supported

them. host: we believe that there because we are running out of time. we are going to take a short break. when we come back we will have a discussion of the role of the federal reserve. you are watching "the washington journal." today is tuesday, november 23. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010] >> from barack obama to george washington, learn more about the nation's presidents online at the c-span video library. biographies, interviews, historical perspectives and more. searchable and all free. washington your way. >> this weekend on book tv's "after words." james zogby questions muslims

about stereotypes and the war on terror. part of our extended holiday weekend of nonfiction books and authors, starting thursday on c- span2. >> here are some programs c-span is airing thursday starting at 10:00 a.m. eastern. academy award winning actor jeff bridges talks about his work reducing youth home burke, jane goodall on her love of nature and animals, chief justice john roberts on the role of the supreme court and lawyers discussed the impact of retired justice john paul stevens and former president bill clinton presents the liberty award medals to tony blair. thanksgiving day on c-span. "washington journal" continues. host: david malpass joins us from new york to talk about the role of the federal reserve. he is a former deputy assistant treasury secretary and former deputy assistant secretary of

state. welcome to the program. caller: good to be there. -- guest: good to be here. host: the fed has started quantitative easing to lower interest rates through treasury purchases. for those who barely got through economics 101, what does it mean? guest: it is complicated. normally what the fed does is borrow from banks and buys treasury bills, very safe assets. then the banks go and lend the money. the feds in a fact provide the banking for bank loans, the reserves, so that banks are protected in the event of problems. this time they are doing it differently. they borrow from the banks but they are buying long-term assets -- treasury bonds. in fact the fed, as it expands right now if, it will have a

balance sheet, more assets than the combination of general electric, goldman sachs, an exxon combined. so, if you add up all the assets of goldman sachs, exxon, and general electric, the fed has more money than they do have long-term assets. host: the new york times saying the fed adopts washington tactics to combat credits. do you get a sense the fed is making this decision to get people off of their backs that are criticizing their policies and their programs, or that they actually believe that this is what needs to be done in order to rectify the economic of tuition in the u.s.? -- economic situation in the u.s.? guest: i think the fed believes this is a good approach to helping -- jobs. the question is do you want a bigger role for the fed or the

federal government in general. some argue the federal government should simply borrow money and spend it and it would somehow help the economy. now what the fed is doing is saying they will borrow money and buy treasury debt. i don't think that is useful in creating jobs. the fed argues it will somehow lower interest rates on corporate bonds. so, you have big corporations doing better. but history shows that big corporations don't really hire many workers on net. they are all about productivity. so, what we really need is job growth in small businesses. and the fed has not really made the connection how will this help small businesses and new businesses get started and get their first bank loan. that is the challenge and this does not really help at all. host: you signed an open letter to chairman ben bernanke that was dated november 15.

in it you say, we subscribe to your statement in "the washington post" article on november 4 that the federal reserve cannot solve all of the economy's problems on its own. in this case with big improvements aren't taxed, spending, and regulatory policy must take precedence and not further monetary stimulus. it acts of the fed can't solve the u.s. economy -- if the actions of the fed can't solve the u.s. economy crisis, what can? guest: this is the core of the issue. can having the fed buy bonds actually help the economy? that group thanks, no, that is not a useful tool. the things that can help the economy, having the federal government spend less so people have confidence that they will be able to hold on to their money and create a new business, create a new job. so, i think the solution is pretty clear.

washington doesn't want to do it. you've got to spend less money out of washington and then have some confidence that taxes are not going up, and in fact, might go down at some point in the future. then the regulatory paralysis going on in the banking system and every area of government. puget legislation comes out of congress. they should be passing short bills. instead, 1000, 2000-page bills and a tangled up the country in and knocked. that is what is going on. host: on october 19 you wrote an article in "the wall street journal" online on how the fed is holding back recovery by promising to print more money. it is giving congress an excuse to avoid critical tax and spending cuts. do you think this is going to change with the new congress coming in regardless of how much money the fed prints out? guest: you know, i would like to think there would be a major response in washington to the

november 2 boat, but the reality is, as you well know sitting there, there is a lot of inertia in washington and i think it is going to be very hard to get them to start -- stop spending as much as they do. the whole system is designed to spend more money. as we come back to the fed, the same and their ship is there. the fed is used to playing the big role itself. i set up an organization called growpac where we are getting people to sign a petition -- petition that says they do not want the fed to get bigger and bigger, which is what is going on right now. host: we are talking to david malpass about the role of the federal reserve. if you want to get involved in the conversation, give us a call.

if you have called in the last 30 days, send us an e-mail or tortured message instead of giving us a call today. -- ortwitter message. you also said mr. bernanke argued that most of today's high unemployment is cyclical and therefore susceptible to monetary stimulus. we see little evidence that the reallocation of workers across industries and regions is particularly pronounced look into other periods of recession. suggesting that the pace of the structural change is not greater than normal. can you go into a little more depth on that? guest: yes. chairman bernanke had argued that the fed doesn't see that people are having to move because of the things going on structurally within the economy. that was a quote that you read

from him. my article in "the wall street journal" in october was challenging or questioning that and saying, look, what i observed across the country is a huge structural change going on where people are having to move out of the northern states, they are also moving out of the industries that worked in the 1990's and the 2000's and having to find new were lower paying jobs. so a huge structural change, i think to the negative, going across the economy because, in my view, high tax rates, high regulatory burdens that make it very hard for people to create new jobs, new businesses. so, that is a structural change. and you can't fix that with the fed. you have to go back to the executive branch and ask them to propose changes that will fix this, and then congress begins its role as well. host: david malpass is among a

group of prominent republican economists campaigning against that barrel reserve's latest move to boost the economy, calling on fed chairman ben bernanke to drop his plan to buy $600 billion in additional u.s. treasury bonds. our first call comes from new jersey. maggie on our line for democrats. caller: good morning, gentlemen. my concern is with this action that the fed is planning, that it will overvalue wall street once again and create a situation that could cause a double dip in our economy, the same kind of meltdown we saw in 2008. i think a more effective approach would be a stimulus package like the one we had, except about three times larger. i do believe that the e economists had suggested that,

and he was deterred by some advisers. i am looking forward to your response. guest: thank you, maggie. with regard to the bigger stimulus package, i don't think that would have worked. but i want to come to your first point, the expansion of wall street itself. i agree with you on that. what the fed is doing is causing a huge extra activity on wall street. the fed buys the bonds from the normal wall street system. they pay some kind of commission on that. also, when they borrow from the banks, they are paying slightly above market rate interest for the borrowing so the banks and wall street are getting money on both sides of the trade. in addition, because of the huge expansion of the fed, the dollar is made less stable, meaning it

goes up and down in value. you know who makes money on that. that again comes to wall street. in the current -- currency traders make a huge amount from the volatility that comes out of currencies. the better solution would be for the fed to seek a relatively stable dollar. that would hurt wall street but it would help the people of the country. they are paying is like a little amount on every currency trade. it is almost like a tax on the instability of the u.s. dollar. countries around the world are seeking to have more stable currencies and the u.s. is kind of alone in thinking it is useful to have an unstable currency. i agree with your point there. caller: i am concerned.

i only make like $660 a month. i learned a long time ago since i and the first of the baby boomers, i cannot have any think if i don't sacrifice. i am very disappointed that is my congressmen and senators vote for this situation and that they are going to have to vote on before long, i am really going to put signs out. i use my own money advertising the tea party because i have a lot of cars going by my house. i spend my own money any time there is something going on here in florida. if no one gives me a dime for what i say since i go to the drugstore and buy boards and markers myself, i don't know

where the people get the idea of how we don't have the right to do this, to show our opinions. when we stand up for what we think is too much government, his then we are all wrong. thank you, c-span. host: david malpass? guest: there is this issue of the spending enough. isn't that enough? every year, going forward even with a new republicans in the house, that number is likely to go higher and higher. i share the concern of the caller. as the fed contributes to it by buying federal debt, it facilitates the process of government spending, but that comes out of a cost to the private sector of the economy.

elderly across the country right now are feeling the inflation. they feel food costs and medical costs going up. the government keeps the numbers on inflation, and the numbers keep showing the government they do not have to pay out for the social security benefits, so elderly are often getting caught on both sides of this cost squeeze. the fed, by making the dollar weaker, it has not protected the dollar. that is one of my complaints. it leaves the dollar weak. grains and costs -- grain costs have gone up. sugar costs have gone up pretty people feel it in their pocketbook. i think the fed should be more focused on dollar stability, and they should say it.

the fed tries to ignore the dollar and they say it is not their job. it is really their job. that is the core of the complaint. they do not protect the dollar in the long run. i have a web site where we have a petition that people can sign asking the fed to stop expanding and to better protect the dollar. host: david malpass and others wrote an open letter to fed chairman ben bernanke. they wrote "we do not believe such a quantitative easing plan is necessary or advisable under current circumstances -- sal is on our line for

independents. caller: the system is a replacement for the foreign banking system that was thrown out of this country by andrew jackson right after he was elected president. the fed was reestablished by permission of the u.s. congress with only three people on the fold just before christmas. 20 years later, the congress went to the fed in redemption of the notes issued was forced to declare bankruptcy, and we have been in bankruptcy since june 5, 1933. this is a documented call from the house resolution enacted. the fed has gone and made us bankrupt. it is not federal. the u.s. constitution -- the question of a conspiracy -- the

question of why we borrowed notes from the federal reserve interest win at all times they had the power to issue notes on their own without any interest is a question that needs to be asked. host: you have asked it guest: the constitution does talk about the dollar, and it clearly comprehends that the dollar is supposed to be a stable value over the centuries. i agree with the concern that we have lost that somehow that we have to get that back. i am not one who is right now criticizing the independence of the fed. i think we would be at grave risk if we had the fed responding to politicians, to appropriations bills, to authorization bills out of congress, so i am not in the camp suggesting that.

my goal is to have the fed change the policy in this is a decrease stop buying treasury bonds and articulate better -- not better, articulate their concerns, their long-term concern, that the dollar be a store of value that will last for hundreds of years. the fed does not want to do that. they should force that issue. the treasury department has been a part of that. some of the people have said this is a partisan criticism of the fed. ben bernanke was a senior republican appointee and the bush administration. i criticize the fed policy in that administration as well because it was not strong enough on the value of the dollar and the constitutional principles of stability. i think we have to have a lot of introspection. a change in the policies that the fed pursues that will give us more stability in the long

run. host: cash confusion is the opposite in the "washington *." -- in the washington times." we are talking about this with david malpass this morning. our next call comes from richmond, va.. caller: good morning. i see you ran for the senate for the republican party. i have a couple of questions. one is a statement. the federal reserve is a private institution. i don't really know what it does. what i am asking about his [unintelligible] it was talking about the

employment act of 1978, giving the fed a new mandate. i am wondering what that institution should have the ultimate purpose of fostering economic prosperity and social welfare. i fail to see why a central bank has that role. the legislative branch will not do another stimulus. i would be interested in your comments on that. guest: of those raised a very good points. george went back and questioned the core of this. why should the fed have responsibility for employment within the economy. that came out of a particular time of high unemployment, so i

think congress was trying to shift the responsibility to someone else so they could keep their offices and see to it. i think it is legitimate for people to wonder about what the proper role of the fed is. the federal reserve system has 20,000 employees and is right now making $100 billion per year. and i mentioned earlier the size of its assets are bigger than exxon, goldman sachs, and general electric combined. this is a giant organization that has now been given by congress the role of protecting the consumer from the financial system, so they have added this giant regulatory mandate on the fed and has not given the fed itself control over spending. i think there is a huge question to congress.

what are you doing? why are you giving good jobs policy -- why are you giving the responsibility over to the fed again and again? the answer is obvious. they want to deduct responsibility out of congress. the fed should not be expanding now. the responsibility is on congress and the president to come up with a tax reform that will work with lower rates and a broader base for the tax system so businesses can create jobs and above all less spending at the federal level and less of these complicated regulations that come out. by inserting itself right after the election in the debate, the fed has exceeded its mandate or has been broadening and mandate that actually it should be shrinking. i hope we can have an open debate.

the fed has to defend itself by saying we must not have been communicated very well our goals. that is not the problem. the policy itself is an expansionary policy that should be discontinued and wound down. it will not be problematic to do that. the fed is borrowing from banks in order to buy government debt. debt can be wound down in january. i ink that would help the dollar and help get capital flow back in the u.s. my ultimate goal is to have u.s. companies instead of investing all of their money in asia to borrow away from the u.s. dollar. if the fed stopped buying bonds, he would have a positive dollar change.

host: former fed vice chairman alan blinder wrote an op-ed in the wall street journal on november 15 in defense of ben bernanke. he writes -- tell us, what is deflation and why is it critical that we do not go into that area? guest: i've put into that letter, the letters that we did to bernanke, the idea that we as a group do not think it is a good idea to increase the deflation rate.

deflation is when prices fall. it is harmful because people may have borrowed money on the idea that they could retain the value. let's say you buy a piece of property with borrowed money, and the price falls. think how much worse it would be if there was a situation where cans of soup or falling in price. if you bought it, you would lose money as the price fell. you would be better off the playing your purchases under dflation. i don't think the u.s. is at risk of that. japan had situations where in a one-share basis, the generalized price level would be negative, like - 1%. that caused people to stop producing and stop purchasing

because there was a shrinkage of the economy and the price level. the u.s. has not had that. prices in general are going up. as we all know, the prices of things that people buy every day such as food and medical costs are going up rapidly. bill prices are going up. gasoline prices are going up. i don't think the fed is right to worry about deflationary or the japan situation or the right to seek a higher inflation rate, and that is a part of the complaint that we have raised to the fed. host: david malpass has been a chief economist at bear stearns and is also between 1984 and january 1983 held economic appointments during the reagan and bush administrations for

developing nations and deputy assistant secretary of state. he has been a republican staff director of congress's int economic committee and senior analyst for taxes and trade at the senate budget committee. he is our guest for the next 15 minutes. flint, mich., on our line for democrats. caller: and i would like to ask a question in regard to the quantitative easing. with the fed coming out at a time when obama [no audio] host: go ahead. caller: am i on? i want to ask a question about how the timing of the fed's quantitative easing decision right at the time when obama was going over to china about their currency. with that, it made him look

pretty bad. can you hear me? guest: yes, i can. caller: id undermined his credibility at a time when he was trying to make a strong effort [no audio] host: we will leave it there. guest: hi will raise another aspect of this. chairman bernanke first raised the issue of quantitative easing in august during his speech. some people are concerned about the political timing of that has leading into the november 2 election. it did have the affect -- the effect of some loosening conditions as we approach the

election. i am not into those timing conspiracy theories. i think the fed truly thinks is doing the right thing. that is where the dialogue should be. this policy is not going to help jobs. as far as the president's trip to china, i think it is a grave concern for americans that people from around the world look at the weakening dollar and they see a country that is in decline. i was born and raised in michigan. our caller was from flint, michigan. we saw this gigantic decline for northern states across the u.s., where as the dollar weekend first against japan and now against china, the capital flows to the country's trade in the 1980's, the theory was we were going to weaken the dollar and it was going to help us be

competitive. the money from the u.s. went to japan and built a better car there. so we lost our jobs in the united states because of the weak dollar, and now we are doing it again with china. the president went on a trip to china, and the chinese look to the united states and think we should stop buying our own government debt britain should stop having our central bank and by our debt. that was a powerful message from the world central bankers back to the u.s. i think the burden is back on us to reconsider our policy, wind down the quantitative easing. i have a website where people can sign a petition, asking the fed to stop expanding. this is not the time for the fed to expand government. caller: good morning, gentlemen.

as a laid-off history teacher, i am so glad you are talking about the federal reserve because i think this is the wizard behind the curtain when it comes to our economic problems. studying history, i know a lot about the fed predicted to claim that they are a political, it is in st. predicted they control the value of the reserve currency of the world. there is a reason why the founders put article 1 section 8 in the constitution because the congress is accountable to the people. ben bernanke is unaccountable. the fed is in politics anyway. that is a cop out. i do want to make a comment that some other people have made, too. i think the american people need

to understand they are a private bank. that is one of the reasons why we cannot open up their books. if they have our best interest in mind, what are they hiding? they have given money to other countries without our permission. and i am sure we are involved and we don't know about it. host: we will leave it there. guest: these are all big issues and i am glad people are reading it with history and with the constitution in mind. and i agree with the fundamental point that the caller is making, that there is a role for congress in thinking about how the economy is run and leaving most of those decisions to the people. that is what we have lost. the fed has become a huge, powerful institution that is changing the interest rates and

deciding on its own account to lower the interest rates on government bonds. that seems like an over stretch of the power and an expansion of the appropriate role or an over expansion of the appropriate role for the fed. how do we best yet get back to a system that works for job creation at the small business level? my thought has been we have got to get the fed to stop buying bonds, and then have the fed pay more cognizance to the value of the dollar. i think the treasury department and the president should say they want a stable dollar over the decades. it would be a huge boon to job creation in the u.s. they will not say that now. my thought has been let's take

this in small steps. we will not be able to fundamentally change the whole working relationship between congress and the fed this year, so the best step is to take small bites of the apple to have them stop buying bonds, to have themtake their interests in the dollar, and that would be a huge step forward in terms of the constitutional role of the fed. host: in wall street journal this morning, their stories regarding the economic and financial situation in ireland, there had line is -- -- their headline is -- -- is this a preview

of what we might see in the united states? guest: i think it is a preview. we have done some of that. our banks were badly regulated in the 2000's. we ended up with a real crisis. the regulators had looked the other way, and that is what has gone on in ireland. now they are paying for it just like we are in terms of our high unemployment rate. another lesson that could come from ireland to us -- i have written on this topic. the state debt in the u.s. is very large, almost as large as

ireland's debt. the people of the states will have a huge problem paying for that debt and paying the pensions that go along. one of the things that we gravely need right now is a backbone to stand up to the problem before it becomes a crisis. but ireland's crisis is being made worse because they waited -- not so much of ireland, but the banking regulators waited and waited to tackle the problem. the better situation for the u.s. is for us to recognize california's spending as a state government is out of control, and the federal government should not be bailing them out, should not be facilitating the process of state spending. unfortunately, washington provides huge subsidies to state and local governments around the country so that encourages them to give excess pensions and

spend more money than they have that. i think that is a lesson we should gather from the severity of this irish crisis. we do not want to get into that problem. i proposed a series of steps for the federal government to stop helping the states overspend. i think that would move us in the right direction. i want to mention my focus today is on getting the fed to stop buying bonds so we could actually see what the problems are. i have a website where people can sign a petition, asking the fed to stop buying bonds and stopped expanding its role. host: texas, thank you for holding. caller: why are they talking about quantitative easing three

already? guest: these are huge questions. goldman sachs in one report said it thought there should be $4 trillion of the fed of bond buying in order to stop the situation. i think there needs to be a new blood in the fed, new people working on some of these problems. i don't doubt the good intentions of the people involved, but it has become a very narrow situation where many of the regional feds come up from inside their system. i do think this is a time where we should be bringing in new ideas and new blood into the fed and a broadening the base of experience for the people regulating and controlling of

the interest rates and so on. to go to the ladies. -- tim geithner who i have known for many years, who is not a goldman sachs person, that conspiracy theory has gotten more broad than it should. it is a tightly knit group of people at the fed and that treasury who are making these important decisions. we need more public input into whether we need -- into whether we have a strong and stable dollar. that is not in wall street's interest or the bank's interest because they like trading all these currencies. for the public at large, having a strong and stable dollar would be a big step forward. we need an administration that backs up that policy.

that would be a huge boon to our economy and to job creation. host: let's get some public input from bernie on our line for independents. caller: how are you, mr. malpass? may i call you mr. deputy secretary? guest: that is fine. i don't even remember those days. caller: i was born in 1941. there was a war and that time. -- there was a war at the time. during the great depression, the government spent a lot of money. we went back into the depression. it almost seems to me that when the war came, the country -- i remember rationing.

we were not able to get certain amounts of butter, sugar, and a gasoline. when the war came, we did massive spending. the the military came back and got jobs and started spending. earlier in the program, you said the government spends $3.80 trillion a year. doesn't it stand to reason that sohow -- i know this is an economic question. i took one course in college so i and dangerous. doesn't it stand to reason that may be the stimulus was not as large as it needed to be? there is a number of economists who have said that. we have 15 million people misallocated in our labor force. i am almost of the opinion of wpa, something else that puts

money in the hands of people with a tendency to consume host: . host: david malpass. guest: that argument has been made. as the government spends more money, people look at their own budgets and cut back. you don't actually get the stimulus that the economists claim. i think we saw that in both -- bush started this idea of putting money in consumers' pockets with rebate checks. it turned out that people knew if the government borrowed the money, it was on them. so they cut back. you did not get the consumption impact that economists had labeled. i want to focus on the production side of the economy. the question is how do you get small businesses and new

businesses to add that next worker. how'd you get every small business in the country to add one worker? you are not going to do that by having the government spend more money. that has the opposite impact. furthermore, the money flows away from the united states. big corporations are borrowing dollars and taking it abroad to create jobs there because those governments are not as out of control on their spending policies as our own government. you get that double-out of the spending. there was -- they raised taxes and there was a huge tax component and a mistake that caused that second depression of 1937. the book was written -- a book was written and many articles

corrected that perception that some how fdr's spending got us out of the depression. host: david malpass, we are going to have to leave it there. thank you for being on the "washington journal." guest: thank you so much. i hope people visit my website and signed the petition. host: we are going to take a short break, and when we come back, we are going to be talking about afghanistan and the future of nato. first, a news update from c-span radio. >> a senior administration official says president obama was awakened shortly before 4:00 a.m. this morning by his national security adviser and was given a briefing on the situation of the korean peninsula. he will be given further updates this morning. at least two south korean marines are dead after an exchange of fire between north

and south korea. press secretary robert gibbs called on north korea to a "halt its belligerent action." changes are coming to the white house staff. david axelrod's long anticipated departure from the white house is happening a bit earlier than expected, right after president obama's state of the union speech in early february. president obama's 2008 campaign manager will be joining the staff in early january, also a bit earlier than predicted. officials say the move was motivated to quickly transition to the president's party " pre- election campaign in chicago while biting himself a few weeks of rest. more on airport security. government records show the companies with multimillion dollar contracts to supply american airports with body

scanning machines more than doubled their spending on lobbying in the past five years and hired several high-profile government officials to advance their causes in washington. the lobbyists include a wife of senate majority leader tom daschle. those are the latest headlines at on c-span radio. >> this year's student documentary competition is in full swing. make a video on this year's theme, washington d.c. through my lens. you have a chance to win a grand prize of $5,000 project for all the rules, go online. >> we provide coverage of politics, public affairs, nonfiction books, and american history. it is all available to you.

find our content any time throughout c-span is a video library. and we take it on the road with our local content vehicle. it is washington your way. created by cable, provided as a public service. "washington journal" continues. host: we are joined now by a u.s. ambassador from nato to talk about the future of nato and afghanistan. we want to ask you. what is your latest understanding about what is going on in north and south korea? guest: unfortunately, i do not have the responsibility for the entire world so i do not have the responsibility for this part of the world. we have some serious incidents on the border area.

let me and leave it at that in trying to speculate about what may have been said to the president. host: tell us, what do you feel from the administration's perspective was accomplished over this past weekend? guest: quite a lot. three big things we tackled over the past year through a significant effort from the president and his team. one was to make sure nato is an organization ready to deal with 21st century and threats of nuclear proliferation and cyber attacks, and we got a whole series of decisions from the allies that puts nato squarely in the 21st century. we want to make sure that the coalition that was built, the largest coalition since world war two, to deal with the issues of afghanistan would not only

remain united but remain united on a path toward success. i think the decisions reached have allowed us to say that we are now in the together to see the future. finally, somewhat unexpectedly, we had a very good and positive meeting with the 28 nato members. we were able to reset the relationship between russia, very much like week recess and the relationship bilaterally. in the end, we were able to achieve all three. host: give me your assessment about the nato-afghan agreement, which will basically allow for a transition of security responsibilities by 2014. how did that agreement come to pass? what is the first that in

making that come to fruition? guest: you need to stand up or you will be standing alone. standing out means we will train your forces, and we have been trending down now for quite some time, very intensively for the past year. we believe there are parts of the country that are sufficiently secure so in early 2011, these afghan forces can take responsibility for security. they will be in charge. they will still in its support of nato forces to supply them with ammunition and fuel. today, the security is in the hands of the afghan police and army, so provinces while overtime transfer from nato security to the afghan security. the goal here is to finish the process through of the country

by the end of 2014 so over the next four years the entire country will be seeing afghan forces are responsible primarily for security, with nato forces be in support of that effort. host: is there a checklist that the afghans have to complete in order for the nato forces to be comfortable with making the transition of these responsibilities? guest: we have set up a board that does in its regular assessment of the situation in the districts and the provinces -- 34 provinces in afghanistan, that looks at the security situion in terms of security and the degree of governance capability and the sense of economic development. a judgment debts made about where the province is on each of those three measures and if they

reach a certain level which is believed possible to ask it -- for the afghans to take the lead, the decision is made for the transition to occur. that process will take 18 to 24 months to complete. over time, they grow in confidence and capability. the nato forces can stop being directly there and can stop pulling back and thinning out and beat ultimately it there just for a training role at the end of the process. host: we are talking to the u.s. ambassador of nato about the future of afghanistan. if you would like to get involved in our conversation, give us a call. you can also send us messages

via email and twitter. in the new york times this morning, sharp criticism after an official portrayed kabul as safe for children. a senior representative said it in a bbc interview -- she told the interviewer that -- -- he had told the interviewer that -- what are your thoughts about that statement? guest: the security situation today in kabul is significantly different than it used to be. this is not a city where bonds are going off all the time. the last violent incident occurred six months ago. it would not be a place that you

would want your children to grow up, but it does mean the security situation for the average afghan living in the city is significantly improved. you can find a bustling market, electricity through out the homes when you fly in. you see a city lit up when you fly in. i think that is what he was trying to say. the way it was expressed might be unfortunate, but the reality is there is a significant improvements in many of the cities in afghanistan. host: our first call comes from michigan on our line for democrats. caller: i find it mystifying that we have to train the afghan people when the afghans defeated the russian army. the problem is, we are asking

the afghans to kill afghans. i know that they need a security force, but it is just like someone -- you are asking michiganders to kills other michiganders. i know we are only doing this because of the natural resources in the area. guest: afghans are warriors. they have proven that when they defeated the soviet union. the problem is it is a divided society. for the last 32 years, it has been in one form of civil war or another. the current fight is between afghans and afghans, but it is between political groups that want to take over the government.

but they want to bring their allies back into afghanistan in order to train and be prepared for the kind of missions that we saw on september 11, 2001. that is why we are there. on september 11, 2001, the united states was attacked from a base that was a safe haven in afghanistan. our fundamental objective is to make sure that never happens again. that is why we are supporting the afghanistan government, in making sure that the insurgency forces do not maintain power. that is the reality. that is the reality of a civil war that we are partf because our security is directly affected. host: next up is a blot on our line for independents out of

petersburg. good morning. caller: i agree with that last call. in light of the incidents we have had from north korea, i wonder what nato has on the planning table for that. it seems to me there should be a general forces from nato and the allies stopped because north korea is going to keep on getting nastier and nastier if nobody stands up to them, i think. thank you and have a good morning. is becomings reach broader and broader. it now has 150,000 troops but it does not reach all the way to north korea yet. when it looks east, we look at

the euro-atlantic area. the rest of the alliance does not look at north korea. certainly not in the military sphere. we will refer to the united states with its allies and the region. that is probably where if there is any kind of security issue coming up in this part of the world where the action will be rather than in brussels where i lived with my 27 other good friends. host: next up is texas, thomas is on our line for republicans. caller: good morning, c-span. i would like to say that i have seen where small arms and even larger caliber arms are coming from several countries into afghanistan for the taliban.

you have, for example, the chinese duplicate ak-47's which were copied from the ak-47's made in russia. they have been notified on tv as being photographed with the taliban using an anti-aircraft gun, which was definitely a russian-made anti-aircraft gun. i would like to know why they don't cut the supply lines of these groups and keep an eye on those and prevent the ammunition from coming in from these foreign countries. you have one shipment that was intercepted going to syria with atomic reactor parts that came from north korea. there is a proliferation of a to z on arms, from the small arms to the nuclear fission aspects.

i would like to hear your comments. guest: there is a huge amount of weaponry that is being traffic around the world. it is difficult to find out where or what it is. first of all, afghanistan having been in a real conflict for 32 years is a place that has plenty of weapons, particularly ak-47's and of those type of things. this is a well armed country. secondly, this is not an easy country to control the border of. some of the border terrain itself is in dispute. these are some of the highest mountains in the world, especially north, with highly porous borders and a huge desert areas, which are impossible to close down, which is what will

be required in order to stop the smuggling. part of our effort is to make sure there is no infiltration of people, of al-qaeda, terrorists who are trying to come in and train -- not only trained but blow up our soldiers and and the civilians who live there. that is a primary focus of what we are trying to do, but it is a terrain that is exceedingly difficult to control given the high mountains and harsh weather conditions that exist there, and given the size it. it is a big country that is surrounded by pakistan and iran and use pakistan, which are difficult to control. we are doing our best. and there is no way to stop the flow of arms into the country. host: this is what he had to

say. >> when i took -- what i communicated to president cars i is two things. we need to make sure that we understand what our objectives are. that 10 points we want to reach are the same. no. 2, we have to be in good enough communications with each other that when issues come up that raise sensitivities about sovereignty, that may alienate afghan populations, we should be sensitive to them, and we will be listening to them. at the same time, he has to be sensitive to our concerns host: do you get the feeling from what happened over the weekend that president carter's ike is sensitive to the concerns of the u.s. and will continue to work with the u.s. in moving forward? guest: certainly in the meetings we have had, as well as within

the larger group, president karzei was aware and appreciative of those efforts and. he recognized that the sacrifices that each and every one of these countries have made. at the same time, he is underscoring what the president said, which is he is a sovereign leader. he would like them to be sensitive to the sovereignty and concns of the people. it is that balance that we constantly seek to strike. we have our boys and girls there and we are being shot at it. as a result, they are going to have to take measures to not only saved our lives about the lives of the afghan people. host: part of the meetings over

the weekend had to do with the nato-russia shield agreement. what is it -- what is being shielded and from home in this situation? guest: nato made the decision that we should have the capability to protect all of nato territory in europe and in the united states against ballistic missiles from coming from wherever, frankly. the main initial thrust of where we are looking at this from the southeast because that is where the capability exists which can threaten europe today. that will be phased in over time as the threat increases. nato will defend itself against ballistic missiles. nato offered to cooperate with russia on the ballistic missile defense at large, believing that

russia faces the same challenge and a threat that we do, that if we cooperate on missile defense, we can have a more effective defense not only for ourselves before russians, which will be cheaper. the russians -- we did not make any decisions on a particular capabilities, but we did make a decision that it was correct in doing an analysis of how we would cooperate. that is a major decision we have been seeking for many years. only in lisbon we were able to get this agreement to cooperate with russia on that effort. host: do the countries that have agreed to work with the u.s. and with nato -- will they see any lessening of u.s. legitimacy if the president cannot get the senate to ratify the new start treaty?

guest: what i think was remarkable was the number of countries and leaders who came out and said it was vitally important for their security to ratify this treaty early and immediately. it was not just leaders in western europe. it was leaders that lived on the border of russia, the foreign ministers of the latvia and the with the india -- of latvia and lithuania. they want monitoring of russia and the capabilities. the secretary general of nato said the ratification of the start treaty will have damaging consequences. host: john you are on with our guest. go ahead.

caller: so many of your comments i want to address, but the idea that iran poses a threat to europe -- that is almost laughable. what i called about is afghanistan. it has been nine years since we have been training afghan forces. sometimes i wonder, when i hear comments like we are going to transfer power for security over to the afghans by the year 2014, 2012, going to start in 2011, i wondered who you people are trying to convince. are you trying to convince yourselves that that is going to happen? it is not going to happen. it is definitely not going to happen. they have been trained for almost 10 years. it has not come to fruition yet.

let's go back to the soviet invasion when the pakistan is moved in to assist the afghans. they fought off the russians. the state managed -- is a managed to flee with their tails tucked beneath their legs. we are just shoveling money into a hole and we are never going to see a dollar of it. afghanistan is going to remain the way it is because these people are an ungovernable nation. guest: i think it is a go vernable nation. it is true that we have only been there nine years, but we have only been there seriously for one year. the united states was

concentrating its efforts in iraq and it was not focused on afghanistan. barack obama ran for office with a clear understanding that we needed to refocus our efforts on afghanistan, and that is what we have been doing over the last 20 months. we have spent the last year providing the right input. we will start to see the beginnings of the output. a nato training mission was set up exactly a year ago. we have had significant expenditures be put into that effort. the result is that only now are we seeing afghan police and afghan army forces that are capable of taking the fight in leading the fight in a whole variety of issues. a year and a half ago, when we started our first operations, 10 american soldiers were

accompanied by one afghan soldier. today, where we are doing the same thing, the ratio is six afghan soldiers to four american soldiers. that is a huge change. you can create progress in afghanistan. host: a former ambassador had this odd edit into new york post. -- this op ed in the new york post. guest: he was obviously at a different meeting and then i was. in afghanistan, we had 43 countries come together for a strategy of success. we got a decision for the first time that the bush

administration tried and never got. is that reset is allowing transmitting of fuel and weapons, materials throughout russia into afghanistan so we can succeed. that is part of the reason why we wanted a reset to allow for benefits for all. host: our next call comes from anthony in baltimore, md., on a line for independents. caller: i would like to concur with the caller that pointed out that the response for the shooting match will be pivotal with what we do in afghanistan. i am really dead set being against involved in afghanistan longer than we should be. there was a survey that said the mountains were full of minerals

and ore. when are we going to go up there and determined -- guest: -nobody wants to be there longer than needs to be. we are not there yet, and we are trying to get to that point as soon as we can. with respect to the mineral possibilities and wealth and that is there, this is an issue that is constantly being investigated. for this to come to fruition to a country that is not at war with an infrastructure that can take advantage of the extraction of minerals and be shipped overseas, in the manufacturing industry that can exploit the wealth, that is union

development. that is exactly what we are trying to achieve, the situation with the afghans can provide for security in their own country. . . guest: that is an excellent question. currently there are 28 countries in thnato, including the united

states. everyone has forces in afghanistan. there are 21 additional countries for a total of 49 countries that have forces in afghanistan. it is the largest coalition since world war ii. it is not just a little bashir and there. close to 50,000 troops in afghanistan are non-american. united states is 100,000, but over 45,000 arnon-american. and when you think about the other statistic that people need to understand is that well over a third of the body bags that come home from afghanistan did not come to united states, they go to other countries that are suffering casualty rates that are larger on a per-capita basis than the united states.

little countries doing big things, that is what this alliance is about, and that is why it is so important we maintain the alliance and its capability to success in afghanistan and what was reaffirmed in lisbon over the weekend. host: we have it twitter message that rights, how successful have you been in eliminating opium addiction and illiteracy in the afghan trainees to achieve nato goals? guest: that is a great question, because it is one of the greatest problems we have. narcotics use is quite extensive. one of the things we're doing is one of the new efforts we are trying to put them to good use is literacy training. when you want to become a policeman, we will do basic first and second grade education

trading. it is pretty fundamental. we're talking about a country that has 70% to 95% do not know how to read and write. we're trying to address it directly produce educational process, and we're making progress, but it is slow going. host: jerome on the line for democrats. caller: mr. daalder just touched on education and the fact that a lot of people in afghanistan cannot read, probably cannot write. wouldn't it be much wiser to spend more money and resources on education, rather than military -- i do not know what i

want to call it -- military operations? i will take my answer off air. guest: jerome, it is not an either or question. i am a big fan of brett morrison that has done so much for education in afghanistan and northern pakistan. we're spending significant resources on education, but unless you can build classrooms in which kids, girls and boys, get a good education and not have been destroyed by the taliban, you not get very far. the taliban is taking classes and blowing them up. they are preventing girls from going to school. in order to have an education in a country like afghanistan, you need to be able to provide an environment that is secure enough for girls and boys to be able to go to school. that is the reality we tried to

achieve it. if you look at the places this is tried to move forward in a positive way, look at the software is -- at the south where the education, the level of education for boys in particular, across a little less -- girls a little less, has improved tremendously because of the security situation improving. we see this as needing to move hand in hand. if you create an environment in which kids can go to school, the new build the school and provide the teachers so they can read and learn what they need to do to survive in a society like afghanistan. host: decatur, texas. brian on the line for republicans. you are on with ivo daalder. caller: my question is, at the

taliban has to have support locally. as you mentioned, every man is armed with sean ak47. guest: you are exactly right. they do have local support. it is local. the reasons for it are many. they are lack of economic opportunity. we call the $10 taliban who gets paid to play an ied or be part of an ambush. -- lay an ied or be part of an ambush. there are a whole host of reasons, which is what the strategy is not just about trying to kill the bad guys. it is also to provide the basis for good governance, for a

degree of development that allows people to once again believe in their own government. this conflict will not be won unless people believe the government can take care of them, provide for their security card and do so in a way that is decent and dignified for their own future, and begin to provide for their prosperity. without that, this conflict will go on and on and on. and frankly it will not succeed. you have to have an integrated strategy that focuses on security, governance, and economic development at the same time. host: we have a call from alex in munich, germany. good morning. caller: i just wanted to ask you a question concerning the iran situation and afghanistan situation, because your troops are running their race for raw material.

it is a vicious circle, and how can you stop that situation? guest: our troops are not there for raw materials and minerals. there are there for one reason and one reason only, because our security depends on it. we saw what happened on september 11, 2001, and we do not want it to happen here, in europe, munich, we want it to happen know where. the area in which the conflict is most likely to come from and is directed is the area from afghanistan and pakistan. today, as you know in munich, there is a widespread security alert against terrorism, and those terrorists are going directly to the area in which we have our forces. we have our forces there because we want to provide the kind of terrorism we saw in september 11 or in july 7, 2005, in britain or in madrid in 2004.

that is why we're there, because our security, are real fundamental security depends on in afghanistan that is capable of providing for its own security in making sure there are no terrorist safe havens. host: ann writes to save the alliance, a soldier should come home, unpack and start planning their next mission, the defense of democracy in europe. your thoughts about a more narrow focus? guest: i do not think this is an either or proposition. we need to succeed in afghanistan. if we were to leave afghanistan today, the securities at the democracies in europe would be affected very much in the way i just talked about. our six security depends on the

succeeding in afghanistan. -- our security depends on us succeeding in afghanistan. that does not mean we do not care about democracy in europe. in lisbon we reaffirmed the fundamental importance of a europe that is united and peaceful and democratic. today that area is more peaceful and more united than it was before. still not completed. still need work to be done. there are fundamental difference including between us and the russians, like georgia, but that does not mean just because we are in afghanistan we are unable to do that as well. this is an alliance that can walk and chew gum at the same time. that is what we're about and what we reaffirmed in lisbon. host: our next line is on the independent line. pete, you are on "the washington journal." caller: i would like to bring

you recent news on 9/11 that has come out from a lawsuit that was lost by the national institute for standard technologies by a group called the international center for 9/11 studies, in which 60 to 80 hours of film that was never before seen by our government that day. so far every bit of footage that has been viewed has witnesses on the street, firemen and victims, talking about bombs going off in the lobby and the basement just prior to the planes heading the ticket to the buildings. this is multiple sources. -- this is just prior to the planes hitting the buildings. if this is true, and it is, that

draws in to question the entire story of 9/11, and a new investigation is needed. it 9/11 is an inside job -- if 9/11 is an inside job, then we need eight investigation. guest: i am not aware. there is very little doubt that he aimed to -- t plan this attack. there was a central figure that the confessed to the attack and now in our custody. there's not anybody that can dispute the fact that within afghanistan and within the afghanistan/pakistan region are people who are planning to launch terrorist attacks

against united states, against european countries, and that our security fundamentally depends on our ability to make that happen. host: 4 lauderdale, florida. carl on the line for democrats. go ahead. caller: a question is historical. number one, the european union is the largest economy in the world. yet they do not contribute as we do to international defense. my question is this, why is it necessary that we have a permanent alliance. before the worfirst world world's we had alliances that were negotiated after a certain amount of time. there are probably more europeans in the european union than in the united states. if we supply 100,000 troops to

afghanistan, why do not required at the european union, most of which are in nato, also supply 100,000 troops? there is no reason we need a mediterranean fleet of when the italians have two aircraft carriers, france and spain have one or two each. host: we will leave it there. guest: clearly the your opinions -- to youthe your opinieuropeans are contributingo nato. the second point is widely need alliances? because alliances provide the personal effects of working together. a little bit by each of them can

to get there be more than the sum of the party. that is what makes a difference of having an alliance of the willing. an integrated command structure. common capabilities is what makes this alliance stronger and more capable than it would if we were just a bunch of countries that wanted to fight together. that is why nato still remains the most fundamental cornerstone of the national security strategy. it is why we are in afghanistan with them rather than without them. it is why we are more capable working with them than without them. people can and should do more, but without nato they would do even less. host: our last call is from the norm on the republican line. -- is from norm on the republican line. and caller: we have been afghanistan for many years. we have not pulled out.

we send a bunch of soldiers and marines in there in 2003 and 2004. i question your ability to bring history and change history to the nation. thank you very much. guest: you must have misunderstood me. we have been in afghanistan for 2001, but for much of that time we underesources that effort. we did not provide the troops in capabilities necessary for us to succeed because we were focused on another part in another war. it is only since 2009 that we have finally resources the effort. we have provided the impetus, the right kind of input for us to have the strategy of success. it is not that we have not been there, but only now are we there in the right manner for us to succeed. host: ivo daalder, pink you for being on both -- thank you for being on "the washington

journal." gu>> the economy grew slightly faster than initially thought. the report shows a gross domestic product increased at a 2.5% annual rate in the diet rich in july to september quarter, better than the 2% pace initially estimated. an update on the situation in the korean peninsula. the son of north korea's president is behind the artillery attacks earlier today on the south korean islands. chinese and north korean specialists believe the brevan chip is designed to mobilize the country and around the anointed successor of kim jong-il. a french diplomatic source says the united nations security council will hold an emergency session. in an sec filing shows that john edwards, former north carolina senator and presidential

candidates, is still spending money from his presidential campaign coffers. $28,000 was spent on consulting and legal fees, 2700 on airfare, over $600 at a holiday inn and salaries for his three employyees. those are some of the latest headlines on c-span radio. >> every weekend on c-span3, experienced american history tv starting saturday at 8:00 eastern. 48 hours of people and events telling the american story. here historic speeches by american leaders in the events that shaped our nations. talk history professors and leading historians and dull and to america's past. "american history tv" every weekend on c-span3. >> academy award winning actor

jeopardous talks about his efforts to reduce world hunger. later, lawyers discussed the impact of supplier -- of john paul stevens and former president bill clinton prevents the liberty award metal to tony blair. at this thanksgiving day on c- span. -- that is thanksgiving day on c-span. host: richard fetter joins us from athens, ohio. welcome to the program, sir. why is colleges so darn expensive these days? guest: i wrote a book about it so it is hard to summarize in a few words. the reason colleges raised their costs so much to consumers, i suppose in the final analysis because they can get away from it.

-- picking get away with it. there are no large forces stopping them from doing it. there is every incentive to increase lending and do more. there are relatively few incentives to do less. colleges become more expensive. that is the essence of it. host: we're corn to be talking about college and its affordability and also ways that students can try to save money and their parents save some money for college and try to reduce the cost. in your opinion, is college education worth going into debt over? especially for people who are so yong? gues-- especially for people who are so young/ guest: that is becoming an

increasingly asked question. college graduates earned typically 50% to 100% more than college graduates. in most cases they will ultimately recoup the money they borrow. that is not as true today as it was 5 to 10 years ago as the cost of college keeps rising and more and more people are leaving college and having difficulty getting good jobs. it is a question that more and more parents and prospective students need to be asking. host: but we're talking with the director of the center for college affordability and productivity. he is talking to us live from athens, ohio. if you want to get involved in the conversation, give us a call. we have a special line for

college students and recent graduates. that is for college students and recent graduates. we would also like to share from your parents, too, since often those of the people writing the checks for the college. will the cost of college create or widen the gap between social and economic class as? guest: there is some evidence that those gaps have widened and the last 25 or 30 years, and colleges rathe than reducing the gap, which i think is the goal of public support of higher education, in fact, those doubts have widened to end colleges may have contributed to the widening of the gaps. a lot of colleges have an

elitist attitude towards what they do. the path of success at many colleges and universities is viewed as how many students can you turn away? mick -- if mcdonald's had that attitude, it would be out of business. harvard flourishes on that approach. we have an increasing gap between the elite colleges on the one hand, and either the lesser colleges in the eyes of the public on the other hand or the people who do not go to college at all. host: so that our audience has a better understanding of the trends of college price and we want to show you figures. in trichet -- tuition and fees rose 7.9% at in-state colleges.

in charges at private non- private credit non-profit -- non-profit colleges rose 4.3% to $36,993. our first call comes from robert. caller: i just want to say that the middle class is being priced out for education. it is very hard to afford it unless you were earning over 100,000. and the government, it is hard to get any kind of assistance unless your parents earn under 20,000 both parents combined. they punish you for having parents that work hard to succeed in life. host: your thoughts. guest: there is a lot of truth to that. colleges go out of their way to

get low-income students. we have special programs from them like the pell grant program. the people with very high incomes can still afford the high costs. it is the people in the legmidde that are feeling the pinch as much as anyone, and they're often a feeling it quite a bit. particularly his point is it makes you almost wonder why work so hard, because if you go to college and you have saved a lot of money and prepare for college, the college will say you have a lot of savings so you can pay the full tuition. but if your parents have been spendthrifts and have lived a dissipated life or less responsible life and there is no money there for college, you are more likely to get more in the way of student loans or student financial aid.

there is some problem with the system in that regard. there is validity to what the student says. host: we had twitter message to rights that richard vedder is wonderful. finally the truth, more expensive and kids become virtual indentured servants to debt. the next call is from louisville, ky. mark on the washington journal. caller: thank you for taking my call. i am below middle-class. i am on disability, and my ex- wife is on disability and my son is 26 years old. he is married and trying to go back to school to get a better job, and he got aw pell grant for college, and that does not

cover nothing. it is either his job or go to college and try to better his life. he has to have a job, so he has to keep going to that. i am worried about my 10-year- old daughter, how will she be able to afford college? host: is your son going to school in state or out of state? caller: in state. host: a state school or private school? caller: he has not been able to go to school yet because he has to be able to make his house payments and rent and utilities and food and just barely surviving. host: you said he was 26? caller: he is 26 and trying to better his life. he got his ged, because he quit

in the 11th grade because he needs the money. he lives in a rural county where you have to work. he is so far away from everything. we will leavhost: we will leave. our students being penalized because they do not go to college right away and as it gets older and it gets harder to get back into the system? guest: it does get harder the older you get. it gets harder partly because of the way life unfolds for many of us. we get married, had kids, take on debt, firehouse, car payment, and so forth, which make it more difficult. those things at 18 can be avoided or at least temporarily put all. there is a problem with that. it is true that it is more difficult for person to work 20 or 30 hours per week in finance a large part of their college

education that way than previously. married people with children find it hard to even do that. putting that aside, it is the cost of college that has gone so high that working while in school is not usually much of an answer. it is a bit of miniature, but only a small part of it. there are options. people in rural areas have a particular difficulty because they're not near campuses. a big part of going to school is the cost of housing and food and so forth while you are away from home. online education has some promise in dealing with this problem. community colleges are lower cost. some of the for-profit colleges offer programs that can provide training for certificates that will lead to a fairly high- paying jobs. there ought -- there are

options, but as the caller said, it is tough. host: michael on the lines for democrats. i need for you to turn your audio down. we're going to come back to michael. let's go to patrick in new hampshire. are you still in school or did you recently graduate? caller: i just graduated in 2010. host: from where? caller: from king's state college. host: how much in debt are you? caller: i have 26,000 over my head. my girlfriend has $100,000 over her head. host: what is your question or comment? caller: i graduated in ma 2010,

and we hear all of the time on c-an from the callers that talk about kids are not hard workers or expect entitlements. i do not think that is the truth at all. we're pretty educated. and i would be willing to pay more in taxes. i hear a lot of people saying that we cut spending. i think that is opposite that needs to happen. this debt worries me. i see a lot of this targeted at my generation, people like me that are starting their careers. i just accepted an $8 an hour job just to pay the bills. my loans are coming in soon and i need to start making payments on that. i would just like to ask you, what can we do to help meet this more -- help make this more affordable?

guest: you have a serious problem when you run up debts of $100,000, and then when you graduate from college the best job keeping its let's say pays $30,000. -- the best job you can get let's say pagsys $30,000. the longer-term problem is the fact that as the college board data put up earlier suggested at the cost of going to college is rising at two or three times the inflation rate, and is rising faster and people's incomes are rising. that is not sustainable forever. we need to move toward some

radical or more significant changes in the way we provide education services. that means moving to less costly forms of education. it may mean revising what we do in colleges and universities, do less research, trim some of the administrative pad at our schools, restate athletic programs, all whole variety of things that we do have to be rethought in order to put more attention on the affordability issue to the students. host: cut facts and figures we have gone from the college board, a total undergraduate and graduate student aid in 2000 to ho9 federal loans constituted 4% received. 69% of total graduate student aid. federal grants constituted 26%

of the financial aid on which undergraduate students rely, but only 3% of the aid to graduate students. we will be referring back to this particular chart that divides undergraduate aid. for example, of the $140 billion in aid in 2009-2010, 8% of aid came from federal programs other than pell grants. 18% came from pell grants. 1% came from federal work studies. 43% came from a federal loans. that was $65.8 billion. back to the phones. dawn on the lines for democrats from maryland. -- donna by on the lines for

democrats from maryland. caller: i am a single mom, and because of my income, my son only qualifies for unsubsidized loans. they are assuming that you have saved up. it is not because i am doing what i am not supposed to be doing, but i just could not save a because i am single. your thoughts on for-profit schools, specifically the university of advanced technology in phoenix. thank you. host: richard, go ahead. caller i do guest: i do not know if i want to talk specifically about the school, because i do not know anything about it.

the for-profit sector of the overall college in rome the sector task rapidly in the past decade or so. it is now up to roughly 10% of the total and growing fast. it reaches out to the type of student, the type of person that the caller is, and generally single moms, people with relatively low income, often working adults, people but are little older, more disadvantaged people, more minorities and so on. on coal i think they do a pretty good job of serving these people. -- on the whole, i think they do a pretty good job of serving these people. so i would not want to characterize that industry either as being saints or sinners, i think they are reduced the contribution to the markets.

because they are for-profit, they totally depend on tuition, so their charges are usually a little more than those of a public university, although the cost to society is not necessarily more, in fact, it may be lower because they do not give governmental funds. i think it as an option that is certainly worth exploring. host: let's take this call from south dakota. jeff on the line for republicans. caller: i have a real quick question. "the new york times" six months ago reported that the ivy league schools in particular, harvard had billions of dollars in their coffers, and on top of that congress was given even more

earmarks every year. if that is true, why can't they get more suited 8? -- why can't they give more student aid? guest: it is true that harvard and the other ivy league schools are very wealthy schools. it is also true if you look up the total amounts of federal money that goes into the schools on a per student basis, it is often higher than it would be to your local community college. the reason is most of that money is going for research grants, rather than for other purposes. and i think there is a public policy question of whether the federal government needs to be funding schools like harvard. you will see very little direct federal money going to harvard. as far as earmarks go, this is my personal opinion, i think

earmarks are dubious practice in general, and as it relates to higher education, they make very little sense. there is no sense of mayor involved in them at all. i hope earmark is on its way into history, and there's some indication that may be the case. we will just have to see. the caller is raising a legitimate issue about schools like harvard that have endowment money is that even after the downturn, a million and a half dollars to $2 million per student that sends a subsidies to support university operations for every student there is in the school, which is vastly more than what a typical state university will spend in the course of the year. host: we have a list from campusgroto.com that shows the

most expensive tuitions. i would like to keep showing that as we take this next call. it is interesting to note that last year when they did the same lists, there were just 11 schools with a tuition of $45,000 or more per year. this year on that list of 100 top most expensive colleges, it is 43 schools that have tuitions of $40,000 or more per year. bristol, tenn., on the line for democrats. go ahead. caller: thank you. i but like to know if you could address the situation where due to the cost of college, if there is a potential for college professors having to be cut. my daughter is a college professor at middle tennessee state. she teaches in the art department. right now her job is pretty secure, but i know with a cost

of education being what it is, they look to spend money where they can spend most frugally, and i am wondering if there is any potential threat for the college professors to be cut from their roles as educators right now. if you will go ahead and address that for me, please. thank you, sir. guest: it is true particularly because of the recession and even more generally true, that state universities and publicly- supported universities have gone under a lot of a neutral pressure. -- that have come under a lot of pressure. i think it is true that many at of the universities of california and police took a 10% pay cut recently. -- i think it is true that many of the university of california employees took a 10% pay cut recently. the percentage of university

budgets going directly for the basics, the core activities, are particularly the teaching of students, that proportion has fallen at most universities in the united states over the last generation or so. that has contributed to the problem. we have had a vast increase in administrative bureaucracies. a large increase in student service spending. you have to of a climbing wall to be a respected university and be competitive with other schools. and there are pressures out there. i see possibilities for change coming to the faculty. one thing, of course, is the teaching loads might increase as a way to try to meet the cost increases over time, and maybe those of teaching load increases are justified. a lot of the research we do is

pretty trivial anyway. there will be some changes coming, there's no doubt about it. the globalization of higher education is another issue. more and more people are taking online courses. why not have those caught by low-cost instructors in india or china who are very well educated in good and can teach at a low price? this kind of thinking is going through a lot of people's minds . host: our next call comes from springfield, illinois. are you still in school or just graduating? caller: in 1985 my husband died and there was no money. and i had to adolescent children. -- two preadolescent children. i did go to school at age 53. i did not think about who could

help me. i went to the university and obtained a job as a faculty assistant. it was step-by-step. to make a long story short, i stayed there and work for about 12 years. i found out i am not a dumb person. it was a wonderful education. i learned a lot about the college system. tenure should be eliminated. ithe perks that the college president received like the clubs in the cars and houses. and there are many ways the talks have venus and many universities -- the top heaviness at many universities. it gave me a very good inside view of the college system being on campus 12 years, and because

i work there, i got free tuition which was marvelous. host: did you get your degree? caller: yes, i have to master's degree, a bachelor's degree, and a couple of minors. i just kept on going. host: way to go, joan. is that the way to go? work for the college you are going to? guest: it is a great story. it is harder and harder to do that because the costs have gone much higher to go to college than they used to, but it is sort of this independent spirit, i will go out and get myself a job to work my way through school and it may take me longer, but i will do with. that used to be the prevailing way that people, particularly people with low incomes or did not have a lot of money, that is the way they looked at colleges

30 or 40 years ago. actually i am old enough that when i started college myself there was no pell grant programs or federal student programs. they did not exist. yet people often manage to go to college. that is harder and harder to do, and we do have to get the cost down. some of the things that the caller mentioned need to be reexamined. should we be giving university presidents fancy country club memberships and cars and paying them a million-dollar salaries? i think that is a legitimate question to ask. host: richard vedder, who recently tennessee decided to end at the plans for pre-paid tuition. is this the first domino to fall? would you explain the difference between a pre-pay plan and 8529

plaa 529 plan? guest: the pre-paid plan are a bit of an endangered species now. the number of states that have them are in the minority. it is about a dozen states. this is where you buy tuition credits, a guarantee of paying a certain percentage of the tuition and when you have paid in the enough money, you are guaranteed that your child or relative will be able to go to college whenever that is at whatever the tuition is at the moment. you are sort of protected against tuition inflation as a work. the 529 plans are run by state governments, managed by investment firms. they are sort of like investing in a mutual fund.

you have no control over where your money goes. it is invested by a professional manager that the state chooses, but you can put a lot of money into these plans, and they are tax sheltered so you can build up your savings that way. you will enjoy capital gains or losses as the case may be over time but from the investment. there is still a third plan called educational savings accounts that has a limit of $2,000 per year, but where you can run the plan yourself. it is more like a traditional ira. there are various savings mechanisms out there. host: and next call on the line for republicans. and caller: i would like to say one thing before i mention something else. i do not agree with mr. vedder's

per suggestion of outsourcing -- suggestion of outsourcing education. part of the probably have in the state of connecticut is children of divorce who are promised education by very wealthy balder's, the court is refusing to enforce that. these children are being forced to compete with other students for loans. i have a 14 year-old that has been working jobs since the age of 14. we could not get that enforcement. it is a large problem for single mothers. there is a history of harvard and brown in my family and high academic achievements. these children have been reduced to absolute poverty. guest: well, i would agree with

the caller that we have an increasing problem in america that arises, i think, how that arisfrom the disintegration of e traditional american family. as we have more and more divorce situations in situations like this, it becomes harder and harder for the byproducts of these marriages, the children, to function, and they are often the losers in this. part of the problem, of course, is this functionality of the family itself in america. part of it is things such as the enforcement mechanisms used to insure that these children are protected, and that is what the caller is talking about. the courts not being aggressive in enforcing arrangements to protect the children.

host: springfield, va., on the line for democrats. helen, go ahead. caller: i want to talk about the comments about outsourcing the jobs. it is not just about outsourcing professors and taking them on line. if you cannot understand the individual who is teaching, you gain very little from the contents of the course. the second thing i want to address is the way the form was developed. l looks up at your income for there is any type of debt or deductions. when people's incomes are looked at by the college board or the college institution, it is not a true reflection of what your income is. for a family like mine where i have five children plus a husband who went back to get a master's degree, the amounts of

the debt that parents are caring is well over 40,000. every time we do the form, they totally disregard the debts, what you have to pay for living expenses, for your housing. as a result of that, they say you should be able to afford 40,000 educational expenses. we would have to live on the street and essentially stops eating in order to make that actually a reality. host: returichard vedder, your thoughts on that. guest: before we get to that, i was not advocating outsourcing. outsourcing is growing in all areas of our lives. as labor costs are lower in other countries, higher education entrepreneur worss mak

at these places for more and more of their labor costs. i am not necessarily advocating that. the fast bucvaspa format is comd discouraging. in discourages many people from killing the format. it was complicated and hard to understand and so forth. as to simplify the forms, one of the trade-offs that happens is you may throw out the information that would be useful in making a more accurate assessment of the family's ability to pay. there is some trade-off there. honof course people with five ildren should be taken into consideration. it is my understanding that it still is. cothe size of the death of the

caller may suggest that i am not inherently correct in my assumption. host: next up as any on the line for independencts. caller: i would like to make comments about the college system. i technically did not finish school. i walk a line to graduate, but i would like to talk a little bit more about the process of what i have been through. i had a bipolar disorder, and when i was young i took care of my mother who had health problems. i have a certificate in child care. when she passed away, i qualified to get social security. so i decided to go back to community college, and then i

transcurrent to state college. i was an english major. i was going to be a teacher, but then i changed my mind. i had an internship writing for a newspaper. my disorder is such that keeps coming back every now and then. when i attended school i was extremely depressed and nervous and anxious about the job market and decided to take an incomplete. i walk the line in my graduation. i continued my internship for a couple more months. now that i have writing skills and was looking for work, there is very little work out there. what i noticed as i have a couple of friends, one who has two degrees, one in english and one in media -- host: we are running out of time

so i need for you to get to the point. caller: i notice we are going on getting more and more education and without the experience plus education, i feel like the schools are trying to get us to spend more money on more classis. host: richard, go ahead. guest: that is unfortunately a common question. there are 17 million americans with college degrees that are doing johns that do not require a college education. many of them are held by people with ninth grade education. it is a bigger and bigger problem that she is identifying. host: the last call comes from syracuse, new york. michael, go ahead. caller: think you for taking my call. -- thank you for taking my call. i am a recent graduate from one

of new york state's higher- performing universities, and i have a of a bachelor's and master's. i went back to school in my late 50's. now i cannot find a job. i am straddled with student loans. and i have a disability, too, which makes it harder to get work. there does not seem to be any recourse with the student loans to try to help me. i was wondering what your thoughts might be. guest: unfortunately the caller has identified an increasingly common problem in america. and i cannot answer the question with respect to his particular situation, and i think we as a matter of public policy, need to rethink what we're doing.

whether we want to keep pushing and pushing people to borrow money to go to college and a situation such as the caller is facing. host: richard vedder has been talking to us from athens, ohio. into very much for being on the program. -- thank you very much for being on the program. thank you for participating in this edition of "put the washington journal." we will be back tomorrow morning at 7:00 eastern. [captioning performed by national captioning institute] [captions copyright national cable satellite corp. 2010]