also we will talk with an author of "fortune magazine." host: the morning, this is washington journal for june 20, 2012. 20 republican senators sent a letter to president obama tuesday questioning the legality for his directive to keep some illegal immigrants from being deported. the house oversight and government reform committee will meet at 10:00 today with a planned vote to hold attorney general eric holder in contempt regarding additional documents from operations fast and furious. if you want to see the hearing, that's why the 10:00 today on c- span 3.

that topic will be for our first 45 minutes when we get your thoughts on the house government and oversight committee is proceeding. here's how you can join us this morning -- social media available to you as well -- the papers tell the story this morning. the wall street journal has the deadline -- headline --

the papers picked up on the story -- this is the washington times rendering --

there you go. as a little about the hearing that takes place at 10:00. if you want to see live, this will be on c-span 3. you can go to our web site c- span.org for more reformation. your thoughts on the decision for the committee to go on with this vote, the meeting between the two men yesterday, and operations dealing with fast and furious. the phone lines are open. also, you can reach out to us on social media. josh gerstein joins us on the phone from "politico." he covers the white house, but

has also been covering this hearing. give us a context as far as what went back and forth as far as the request from representative response.the guest: there were a series of letters exchanged. eric holder basically made an offer that he would provide a set of documents that congress has not gotten previously. they basically detail how the justice brown and responded to the fast and furious scandal once they became aware of it, in particular after some initial missteps, in particular a letter that was sent to congress in february of 2011 than had some pretty broad denials about any guns crossing the border with the knowledge of law enforcement. those denials turned out to be overly broad or wrong, depending on how you want to characterize them. the justice department set out

to change the letter, but the process of retracting it took about eight months or so. the documents that holder offer probably would have detailed that process, but he still wanted to withhold other documents relating to sensitive law enforcement issues and perhaps other issues and basically representative iss, the chairman of the oversight committee, said he wanted to see the documents in advance of the meeting and then make a decision. holder declined to do that, so we have a standoff. host: have the representative said anything about the mechanics of what will happen at the hearing today? guest: i understand they are supposed to mark up the content resolution. it was a lengthy resolution and report put forward by the republican staff on the committee. the democrats have responded with a bottle. i understand there will be some debate over what should be in the contempt resolution and then some sort of votes.

we expect a fairly lively discussion between committee republicans and democrats and i believe elijah cummings, the ranking democrat, has indicated he thinks of the democratic members of the house oversight committee will vote against a contempt charges. >> the attorney general was present. >> guest: yes, he was cordial, but there was no meeting of the mines. the justice department feels if they produced a document that they would offer a compromise and then the committee would continue to press for the other documents they want, which the tradition of the department is not to turn over those type of documents. holder is looking for a sami- definitive resolution of this story and this episode -- semi-

definitive. host: did the white house say anything about the decision to go forward with this vote? guest: as far as i know, the white house has largely kept out of this issue. they have said they think the attorney general has been responsive and that they think this is sort of all unnecessary, the justice the protest turned over a lot of documents. something like 7600 pages. on the other hand, there have been reports there are 100,000 pages that just as the probable officials have reviewed internally pass as they responded to this investigation. obviously, there's a significant gap between what congress has seen and what the justice department's internal reviewers have seen. host: i know that you cover the white house. has this impacted the day-to-day

operations of the department of justice? guest: i don't think it has been a huge impact. there's obviously been some changes certainly in the way the bureau of alcohol, tobacco, and firearms operates. there have been changes in the way the justice department handles wiretap publications as part of this as well. the fact that some of the details of these operations were sent up to a fairly senior level does is to provide officials as the operation progress, because their approval is needed for wiretaps on individuals and there has been a fight over the last year or so between republicans on the hill and the justice department officials about whether that sort of information should have led the senior officials in the apartment to stop this operation or stop the practice of willing allowing guns to go into the hands of people that appeared to be trafficking them

into mexico. host: josh gerstein serves as the white house reporter for "politico." thanks for your time, sir. guest: my pleasure. host: if you want to give us a call and give your comments, please call. we start with beverly, new jersey, frank on our republican line. caller: good morning. i am going to tell you something, it does not take a genius to figure out that eric holder if is covering up something. and this goes beyond mr. holder. this goes up above him. i don't believe that anybody could sit there with a straight face and tell anybody that they did not know what was going on with all these guns going over into mexico when they can tell

you what to gun you bought from a local gun store in the united states. i truly believe that he is a liar. the is covering up something for himself and above him. nothing has really been done. there has been no punishment really handed out. i believe he should be held responsible and whoever else above knew anything about this for brian. -- brian perry's dust. -- death. host: what will the content vote? the end of the day? guest: that mr. holder is a liar. -- host: vivian in tennessee on the democratic line. caller: they are continuing the

situation with mexico, what bush started. bush administration started all this with the drug cartels. congress is trying to do everything they can to hurt the american people. stallone's, jobs. first, talking about women's body parts. they know what's going on. if you want to get eric holder, go back to the people who started this, the bush administration. obama and everybody else needs to wake up and say that as a started this. they are only continuing what had already been going on. host: dayton, ohio. caller: they are trying to keep eric holder from doing his job with voting rights and everything. this is the way republicans hold stuff over the heads of democrats. like maxine waters and everybody else they are pulling up on committee.

they need an investigation on what the republicans are doing. are they breaking law in any way so we can see the things they're doing to break the law. i don't see them having a hearing on what was done. so leave eric holder alone and stop the bleeding that they do all the time, stop trying to hold something over his head when it comes time to vote. host: fresno, california, sherry on the democratic line. caller: the way i look at it, they should file contempt charges against bush and the republicans because they are the ones who started fast and furious and they knew about it. eric holder is the one who stopped it. issa and the republicans should be ashamed of themselves. they're making a joke of themselves. this is ridiculous. people are getting tired of this crap. it is really a joke what they are doing to this country. it is going to come around

because people are not dumb. i cannot believe they are doing this. i am proud of holder that he is holding up. they should leave him alone at. they should start filing charges against themselves for all the things they don't like the war, for taking money from children and old people. it is a joke. this is ridiculous. that's all i have to say. thank you. host: at 10:00 the house oversight and government reform committee will meet, scheduled to look at this report, take a vote on it, the contempt of congress report for attorney general holder. you can see that live this morning starting at 10:00 on c- span. you can also reference c- span.org, c-span radio, and spent 3 is where the hearing will be seen this morning. that's at 10:00.

we will hear from both sides on this issue. we will start with after the meeting that was held yesterday with attorney general holder, who spoke to reporters. [video clip] >> given the extraordinary nature of the offer we made and willingness to share materials to date, if we are involved more in political gamesmanship as opposed to trying to get information they say they want. nevertheless, we are prepared to provide these materials, a brief on materials, answer questions about these materials. host: long island, new york, keith on our independent line. caller: hello, yes, this is purely political gamesmanship on the part of these republicans, because they had jamie dimon on capitol hill and practically genuflected.

kissed his you know what. the republicans are trying to disrupt eric holder's investigation of a voter suppression in florida, they are trying to distract from that because they don't want democratic voters or people who seem to vote democrat to be able to vote. if they need to investigate anybody, it is darrell issa, because he has a lot of criminal activities in his background. people don't know about his being a criminal himself. that's all i have to set. host: the caller mentioned the jamie dimon of jpmorgan chase, testified last week and this week as well, yesterday in front of the house. it was written about in the new york times --

and in the financial times this morning with the headline -- he told lawmakers yesterday that the agency became aware of the potential significance of the situation on april 9 --

one related story, looking at regulatory issues, this is the wall street journal in the money and investing section. it says -- back on the decision by the house to move forward on the content vote against attorney general holder, this is a orleans, louisiana, republican line.

caller: i tell you what, it is so disrespectful when we talk about voting and our goals, the man with the oversight to stop bullying and talking down. i've never seen so much disrespect since president ites talkinghe whtie to him any kind of way. host: chicago on the line. caller: remember when darrell issa took over the committee in 2010, he said that he wanted one hearing per week for 40 weeks on president obama and his administration. now this mess of the guns was started under the bush administration and it was h --ten by the head of bus he was the attorney general at

the time. the democrats have asked darrell issa to call him, and he has refused, because he does not want to talk about former president bush opposes involvement. , think it was senator cor annyn talking about how eric holder was impeding voter laws, and that is what they want to do. they want to shut down this attorney general so he cannot investigate what they are doing in their voter suppression rules they are passing all over the country. they want to shut him down. they have gone after van jones. they have gone after sherrod brown. they're going after eric holder. and they've always gone after president obama. let's see what they have in common. host: this is an international

story out of egypt. hosni mubarak is in a coma, but off of life support. his vital organs are functioning.

there's a photograph special glow of what happened in tahrir square yesterday. here's the picture. we will move on to our next call, arkansas, brenda on our independent line. caller: good morning. thank you for c-span. it is a wonderful source. actually, i doe -- believe eric holder is responsible for this. he lied to congress on may 3 when he went before congress. the doj did not know anything about fast and furious, but he actually did. he had to backtrack and say,

wait a minute, there was a report last july. and then people keep talking about that the program was in the bush administration. it was, but they notified the mexican authorities about it, which the doj in this case did not do. they actually tracked the guns, which this doj did not do. people were killed. a lot of mexican citizens were killed. perry was killed. our department of justice showed a lot of progress. that is an impeachable offense. he should have resigned. i don't think it is about racism. it is about lawlessness of this whole administration. they go around congress for immigration. they think they can do whatever they want. they don't realize there are. three branches to are this absolutely should impede him, not just criticize him in

congress. -- they don't realize there are three branches to government. host: randy on the democratic line. caller: this program was started under the bush administration. issa, when he got into control of congress, he said that he was going to bring forth the administration people and called president obama and had to backtrack off of that. you guys should try to get some kind of context. with these idiots call in, at least you can tell them the facts. when you fail to do that, you help perpetrate a fraud. of freedom of speech to these idiots on the

program. but you do have a responsibility to correct an idiot. i would hope that when you guys do these programs in the future that at least put some true context on it. you cannot stop it hits from talking, but at least you can -- can recite it. host: this is what they had to set, darrell issa. [video clip] >> the attorney general said that if we would take the briefing, we would have to close the case. we are between a rock and hard place. we really have to go forward. yes, contempt is unusual and the u.s. attorney pleading the case before a federal judge in d.c. can take some time. unfortunately, during that time we don't expect to get a lot of new discovery.

again, you really have no choice when the executive branch's says we will not allow you to look into misconduct within the executive branch. host: virginia, jane on our republican line. caller: hello. thanks for taking my call. i would like to remind everyone that we are country of checks and balances, that we are country of laws, and that no one is above the law. our government is set up so that we should be able to investigate any wrongdoing. if anyone holds back, but they would answer for these things. the thing is it makes him look guilty when it is not provided, the information. if there were not guilty, they would be cleared. this program, if anybody would do their homework, this is not the program that was started under bush. it is a different program that

was started in the obama administration. it does not have any of the safeguards that the other program. had under program it does not have any of the safeguards that the bush program did. this program is about gun sales. it is really sad that it was the furnace by our own government and it was used to kill our border patrol and innocent people in mexico. i don't think calling names is going to solve any situation and it does not matter what color someone is. it is their integrity and morality and caring about this country. we need to put that first and we need to put the country first and find out what the truth is. host: california, abdallah,

independent line. caller: i want to echo what the gentleman from illinois said. really what it comes down to with the attorney general is it is just a witch hunt. republicans are not going to be able to win on issues that affect the american people. with all the republicans changing voting laws in every state, trying to keep minorities out of the process, because they can only been by cheating, this is a witch hunt against the attorney general. i wish that for once we would call it what it is. white america is not satisfied. with a satisfied. they cannot. take cannot that is what it really comes down to. -- white america is not satisfied with a black president. they cannot take that. everyone forgets about the crimes that bush and his crew got away with. for this black man to be able to fix everything in 10 minutes,

not possible. spending under this sequestration has been lowest that it has been in 60 years. you cannot sit there and let that information go out. this is a witch hunt. it is racism. let's call it that. white people are dissatisfied. host: a couple stores from the campaign 2012 trail. this is the new york times --

and the miami herald is following up, saying -- and in the new "new york times, a letter written by the obama campaign, this is a letter by the campaign goes to chief counsel, writing to the group crossroads gps --

and the washington times reports -- that the 10:00 today that the vote takes place on the house government affairs committee, looking at a contempt vote against attorney general eric holder.

modesto, california, tony on the republican line. caller: hi. i just want to make clear that we have to have a government of checks and balances. we have been watching all the games being played ever since this president took office. in 2010 we made it clear by voting all these byout. another thing, on behalf of c- span, it is not the fault of c- span that the people that are calling, whether they are black democrats accusing everybody of racism, they are uneducated idiot's. they don't know how to vote. they voted for him just because of the color of his skin. they don't know any of the issues and are blaming c-span for not educating the people they want to, the most ridiculous thing i have ever heard. it is typical democrat stuff. they know nothing about the issues. they call in and want to blame

c-span. they are completely uneducated idiot democrats. host: illinois, bill on the democratic line. caller: as a democrat, i am appalled that this attorney general. first of all, he wanted to try guantanamo bay prisoners in new york and to house them in illinois. they appointed an obama backer to investigate the leaks in the internal house. every law enforcement agents out there puts his life on the line. then to have the attorney general -- which the program started under his administration and not bush. that is clearly documented. i am appalled that my fellow democrats keep calling in to say it is a racial thing.

look at the facts. the last point i want to make is i'm so appalled at the news media for not giving this coverage. you guys are the only fair news media out there. i thank you for that. but as a democrat, he's got to go. the is an embarrassment to our party. thank you. pedro. host: brian on our independent line from boston. caller: anyone invoking a party name does not understand. there is different rhetoric between george bush and barack obama. but they are exactly the same except that barack obama just is accelerating his policies. i wanted to talk about attorney general holder's policies. he is a liar and likely is in contempt, because he said something else in public that

was considered treason. he went on the air to defend drone murders of civilians in yemen and said there's no such thing as the process because it is different than judicial process -- no such thing as due process, but it is different than judicial process. you need to wake up and look at what is going on. 30,000 drones are coming out. thank you, c-span. host: the topic at the g-20, which is wrapping up in mexico, the financial times writes about --

and a story taking a look at tax policy. this is an analysis piece saying --

if you are a follower of the federal reserve, they might do in reaction to current mayor economic news, they hold a meeting today, a news conference. you can see that with ben bernanke, the fed chairman, the news conference if taking place on c-span 3. you can see that live today starting at 2:15 this afternoon. atlanta, georgia, marjorie on our republican line. caller: good morning. first i would like to thank c- span. i would also like to ask for all the callers to not play the race

card with your opinions, because it really degrades the comments you have going forward. i don't like hate steering. my opinion is that eric holder -- or that it represented iss has no choice but to hold eric holder in contempt, because eric holder lied in 2011 in front of congress. brian perry, an american spirit, has had no justice. and there are people in mexico dead from these guns being out there. who who knows going forward what will happen? we just want answers. we did not want to do this. issa met with holder last night to get to the bottom of it. he asked for the papers to be

released. i wish that could have happened and eric holder did not have to be held in contempt and that we could just all go on. i am very sad that it turned out this way. host: cumberland gap, tennessee, linda on the democratic line. caller: yes, i would like to say that eric holder should be held in contempt. so?: hwwhy caller: because he has lied to congress. he wants dead people to vote. he does not want anybody off the voting rolls in florida. i don't like people hollering about racism. host: a transit project in detroit, it says the u.s. will not fund the detroit rail yet.

there's a story about charter schools and special education students, in the wall street journal.

also, a store looking at the indiana governor. governor mitch daniels of indiana. it says --

in illinois, ray is on our independent line. -- rae. caller: i would like to remind everyone that brian perry was an american her but he was murdered. in the course of this investigation in which his parents deserve answers in a murder case, the authorities must look into all the facts that led to his murder. and in the course of this investigation, because this contempt charge was being filed for information not released, we are where we are. so if the information would just be released, which has been asked for, there would be no charge of contempt. host: harlem, new york, andre on the democratic line.

caller: good morning. this is a republican political witch hunt agenda against barack obama and eric holder. it.e's no other reason for they should investigate the republicans in congress who take the grover norquist pledge, because that is against the law. they don't oak grove 4 norquist any allegiance. they should investigate that connection. and republicans calling in on the democratic line are not fooling anyone. -- the republicans in congress don't owe grover norquist any allegiance. the republicans don't respect

obama and they have a witch hunt against him. host: john is on the independent line from illinois. caller: we all know how dysfunctional our government is and has become. it is about time that the administration and the department of justice, in this case, are ignoring a request from congress. is about time the department of justice stand up against congress. the information does not all need to be released. the people will know the truth when the administration wants them to know it. i look forward to a new administration working under these rules. i hope everyone else does, too. host: portland, oregon, mark is on our independent line. caller: i agree with the republican gentlemen. i was on to say the same king. you're not supposed to give out

information under an investigation. as far as i'm concerned, there has been a lot of gun running from the american government to help rebel causes all the way back in the 1950's through the 1980's. this is an ongoing thing that has always been going on. so there it is. host: the hearing today that's going to be held, you can see it live starting at 10:00 on c-span 3. that the contempt of congress report for attorney general holder, the house oversight and government reform committee. go to our web site for more reformation, but it will be at 10:00 and you can see it on c- span 3. coming up, we will look at the topic of human trafficking in a report from the state department. the ambassador at large from the program will join us. if and then later, the republican from north dakota, john hoven, will discuss it and

what it means for farmers in his state and around the country. we will have those stories when we come right back. >> how do you approach a book interview differently than a news reporting interview? >> e-book interview is like gathering history. i think of interviewing when i'm working on the news side as gathering contemporary information. >> how difficult is it to remain impartial in your reporting and not get caught up in the height of one campaign or another? >> i will try to as best as i can give people as full an understanding of what is happening in the campaigns. it is not that difficult to put

your biases to the side. >> how has visual media changed your lot of work in terms of reporting and getting your news information? >> twitter in particular is now a primary news source for anybody who covers politics and anybody pays attention to politics. porter did not exist four years ago for all practical purposes. >> sunday night, perdue in diversit -- purdue university students conduct an interview. >> next month, an award winning author is our guest, his books on baseball and u.s. presidents has resulted in a dozen books. david pietrusza, sunday, july 1

at noon eastern on "book tv" on c-span 2. >> "washington journal" continues. host: joining us is luis cdebaca of the state department office of trafficking persons. guest: good morning. host: bay of published the report for june. guest: each year the u.s. government issues the trafficking persons report each year since the year 2000, which is when we updated our post civil war slavery statutes for the modern era. if even though this year marks the 150th anniversary? since president lincoln said that slavery should never exist again, slavery still here. it is something we have to continue to fight and every generation has to fight for freedom. this report looks at the countries of the world and says how are they doing on that.

host: can we define human trafficking? guest: as secretary clinton said yesterday when issuing the report, is a euphemism that in some ways defuses the issue. we should just call it what it is -- modern slavery. human trafficking, it was a word that we looked to in the 1990's. a lot of people being enslaved or moving from the soviet empire into western europe. because of that, we grabbed for this word trafficking, but it's not about movement. it is about exploitation. it's happening badly in the united states in our own backyard. everything from prostitution of american girls and foreign women to the folks that are picking our fruit, people that are working in the households of the wealthy or the diplomats as domestic servants. we even had teachers and nurses

who came from other countries and found themselves in an exploitative situation, trapped, not able to leave. host: the common denominator is that it is done against their will? guest: >> indeed. we often have people who know exactly what they're going to do, but once they cannot leave freely, then it is considered human trafficking. many may be familiar with the movie "taken," which is a very dramatic movie, very wonderful. being kidnapped in a foreign capital and sold. usually it is peopled and have hopes and dreams and they think they're going to have a better life. the pumps that are preying on 14-year-old girls in the united states are not kidnapping them as much as they are finding out what is vulnerable, finding out what they want out of life and

saying, come with me, i love you, i will give you glamour, of everything you're not getting an home. -- pimps. instead they give them a life of misery. host: in 2011, 151 convictions took place. what is the difference between the number of convictions and the actual cases investigated? guest: i was a prosecutor in the justice department's civil rights division before i went to the state department. i know that every conviction represents countless man hours by federal agents, state and local police, federal prosecutors, but also by non- governmental organizations, by the legal aid lawyers helping the victims. so these numbers seem low and they are, considering 27 million people that are enslaved worldwide, and the world what prosecution numbers have gone up, but it is still only around 4000 federal prosecutions.

every one of those prosecutions is at a level of complexity almost like doing a great big mafia case. this is organized crime. this is very complex litigation. and so, we need more people who trained to do that not just in the u.s., but we after sure those techniques around world. host: does your office engage in the investigation and the conviction process? guest: to some degree, but mainly we support that the police training, prosecutors training, working with the judicial systems in other countries. we're part of the interagency process in the u.s.. i'm the chair that process by statute. we are able to identify what the folks at the department of justice and department of homeland security need. at the same time, we are the people at hhs and some of the other places need to be booked to care for the victims. prosecutions are important, but prosecutions really are just one

of the steps in dealing process. the victim needs to been to see their abuser brought to justice. they also need to be able to have a better life, a life they were hoping for. that looks like rehabilitation, school, social services. a wonderful story retold last year in the report that i will update. that is, a young woman named hall. we shorter picture last year on c-span or the year before. she was traffic from egypt to the u.s. at age 11, held in servitude in a suburban house in orange county. they made her sleep on the floor in the garage and to take care of the other children who got to go to school. when the federal agents came through the door, she did not know what was happening and was terrified, as any young child would be one armed man, running in. now she is in college and once to be a federal agent. she wants to help other people. a few months ago she was in

court in california to raise your right hand to take the oath to become an american citizen. that is the kind of trajectory we want to see for all these people. the hopes and dreams they have, but we can deliver on them. host: human trafficking in a state department support. we are joined by the ambassador at large luis cdebaca. we will take your questions. here are the numbers -- you can also send us a tweet or an e-mail. what supporting you get from congress on both sides of the aisle? guest: we do get bipartisan support. some of the big champions have moved on. sam brownback going to another

stage of his political career in kansas. and there was paul, who died. we have chris smith helping. and everyone from dick durbin, barbara boxer, debbie wasserman schultz, and certainly the big guns like john conyers and chairman smith. no matter what they might think one other crime policy or immigration policy, when it comes to the notion that victims of trafficking deserve to be helped, even victims who might of been here as illegal aliens, there's a consensus on that. it is special. one thing i will say is there's a bill that ron wyden has for pilot projects, has increased our ability to help u.s. citizen victim's. this is something we recognize that foreign victims often need

more help, the welfare reform law of 1996, they're not eligible for services. 15-year-old u.s. citizen girl coming out of an abusive situation with a pimp, she does not have anybody to walker through the system and say what is in the best interest of the child. ron wyden is definitely looking at that and it's something we're very interested in, the bill that he has. host: the first call from california, rob on our republican line. caller: my background, sb270. [unintelligible]

in mentioned to have a center to help the psychological issues and perhaps sexually transmitted diseases that the girls have and help them with job training and help them become american citizens. guest: thank you, that's wonderful. this is one of the things we are very much trying to work with in the era of challenging budget times, for lack of a better term. how is it that we can support things like you described with centers for rehabilitation, ways to help them. in the meantime, people are coming together whether it is through churches or community groups. the american spirit is coming together on behalf of victims of modern slavery, then we as government need to come together with. you guys in the with --t: thsis note guest: one of the things we see

from the u.n. protocol in 2000 and the u.s. law of 2000 is there's a requirement that you prove threat of force or threat of legal portion. people don't believe they had any alternative but to remain in service. in both legal instruments it is specifically not relevant that they initially chose to do that. kind of like marital rape. you agree to marry someone, that does not mean you agree to be raped by them for the rest of your life. to work with that employer does not bind you for the rest of your life. this is a legal concept that has been settled in the u.s. since the late 1800's. we have been doing these cases in the u.s. for years. whether it was in the first roosevelt in the administration -- first roosevelt administration or seconds roosevelt in the station, president carter, or president obama. if is a bipartisan effort and is something we saw a great leadership front in the bush

administration and we have tried to take that to the next level. host: bill is on the democratic line in florida. caller: i'm from the beautiful indian river area. approximately nine years ago i called and spoke to this issue. the problem at the time was the commercialization of this on your computers. i was watching the montel williams show one day and there was a fellow on the show who have a web site called vulgargirls.com dealing with russian women that you could purchase for couldfor $5 to $10. the audience was rigged, because people were clapping and everything. they made light of the fact that who would not want to have a nice blunt to do this and that

it -- a nicve blond. i thought by this time homeland security would have done something about this particular issue. guest: i think that's your call is appropriate because some people look at this and say it is a women's issue and something women leaders should be doing. but it is not going to change until men are upset by this. they have to reject the notion of boys will be boys in prostitution or mail-order brides or sex tours to other countries are somehow funny or pro. and actually look at them for the exploitation. it is when men start standing up and looking at this that we reject it not just with law enforcement or a justice problem, but it is all of our problem. the idea that guys need to step up, too. i'm glad to hear your comments.

the indian river area of florida is the place be obscene a lot of this situation, whether it is in brothels or in the orange groves. it is happening overseas and is happening with these web sites and in our own backyards. host: when it comes to ranking areas of the world, we can show the various levels, but what is the point of it ranking? guest: one of the things that congress recognized in 2000 was that a lot of the human rights norms out there are not enforced. they are on paper but they are not doing anything. by having a report where we actually rank countries and give them a great, is true that there are minimum standards in the comes down to whether countries

are compliant or not compliant, or just not doing anything or compliant at all. what is important is to remember that your 1 -- tier 1 is getting a c -- saying the country is meeting the minimum standards. they all have problems. we have more recommendations for ourselves in this report and we have for any of the other countries because we recognize that we had a long way to go, what. his victim care or identification or getting the state and low law-enforcement to be full partners. host: we showed the first to tiers. then there is tier 3, countries

that do not comply with minimum standards and are not making efforts to do so. that is the worst. guest: . tier one is a responsibility to work harder. at the same time, to your three is not a parking lot. we do not have countries that are put on tier 3 forever. this year, we saw some activity and movement on the part of venezuela. they had been on tier 3. they moved up to tear two. -- tier 2. it comes down to congress, training for the police officers, things that have not been happening in the past. i think that we see that there is no permanent tier. they cannot get too comfortable. host: where does the u.s. fall? guest: 1.

since we did not rank ourselves for the first seven or 8 years, this is something that secretary clinton has felt strongly about that we should be applying the same standard to ourselves. as a result, we have had those seven or 8 years. when we came on the report, we did the numbers and the data in the analysis and the u.s. came on as tier1. host: syria joined a list amongst the worst. guest: head bent on tier 2. there is a lot of red on the map. this is a situation where we recognize that we have a lot of work to do in the middle east. and they have a lot of economic growth fueled by migrant workers. during the libyan revolution

last year, the 3 million migrant workers who were trying to get out, many of those people could not leave because their bosses had taken their passports. the humanitarian crisis was also a crisis involving human trafficking. getting to syria, we have seen that they had opened shelters for trafficking. that was a good thing that the bashar al-assad government had done. all of that progress, they throw away in order to go after the people who would bring more foreign to syria. in doing that, we had crises with several thousands of filipinos and were domestic servants, they were trapped. host: a question --

guest: one of the things the trafficking report has done over the years is in absence of a fully coordinated effort by the u.n. -- the u.s. report and a diplomacy we are doing and around these issues of the minimum standards to come by trafficking have started to have a coordinated approach. we have more than 140 countries that have ratified the united nations protocol. we are seeing countries doing the first cases they have ever prosecuted. that shows the upper trend we are starting to identified. host: hoda.

republican line your good morning. caller: in florida, it has been reported that three-quarters of the farm workers and agricultural workers are really valerians. it has been rick -- illegal aliens. it costs $5,000 to bring them into the country. where do we get that money? you can thank president obama for making this executive order go out. guest: first of all, the executive order, the work the white house is doing on the immigration issue is not for farm workers or new immigrants. it is for children who were brought in by their families years ago and have been living as u.s. residents, going to lie school, being part of our committees.

i think that is very different from the human trafficking situation. when i was a prosecutor, i was in sebring as we were liberating 400 men from an orange grove were they had been held as slaves and i saw the lack of enforcement had resulted in a zone of impunity. you had a situation where the federal law enforcement was not out there in the field, looking at those illegal aliens. not just because they were undocumented but also whether or not they were being abused or being exploited. for whatever reason, -- where is this covered out of? all of those things, florida became uncovered. because of that come a zone of

impunity grew up. we have to work on this. when we've made the commitment to address to countries broken immigration systems, one of those things was enforcement. hopefully compassion. we have seen that, as well. the notion that we would close down these zones of impunity. we think we have done that. host: -- guest: adoption agencies -- it is an interesting topic. adoptions do not have to do with human trafficking because the person has not been doing an economic function. it is not buying and selling. it certainly see the adoption issue as a related issue to human trafficking and we want to make sure that the unscrupulous brokers in the adoption field

are truly uniting those children who need a good home with loving parents. in doing so in a way that does not violate the rights of the birth parents. when somebody signs those papers and puts their child up for adoption, it needs to be a real transaction. something that is done for the best interest of the child and all involved. not a commercial transaction. host: talking with luis cdebaca. new york. good morning. caller: good morning. trafficking in middle east is legally sanctioned. our women are forced to leave their countries. they have been abused. many of them are killing themselves.

no one has exposed to this. maybe the u.s. does not want to expose this. women are sold. we want to fight these things. our women are suffering. the one is defending them. this is trafficking between governments. this has to stop. we have to fight this. thank you. guest: you know, i would agree with the caller. perhaps we could show the picture of this young lady who's featured -- who is featured in the report. we were able to help her get to malta for medical treatment from the horrible, horrible burns that she had suffered when her employers had tortured her because she refused to use

corporal punishment against their children. she left ethiopia hoping for a better life, a better job overseas. she traveled to libya. she was working as a maid and exactly as the caller said, her passport was taken. physical abuse. in this case, cnn reporters were at the gaddafi palace for the post-revolution story, filming the dictator's residence. she was in the quarter, horribly burned. this does not excuse what happened to her. to me, that is a picture of hope. it has to be a picture of hope for all of the women that we see in the middle east. we do not want to clean up the situation, for bangladesh banned

indonesian women simply to open up another set of a equally vulnerable, exploitable people from ethiopia. the caller has a very good point. we have to remember that these are not statistics. when we talk about 27 million people, we're talking about 27 million individual stories like this young lady who just wanted a better life. host: arlen's. tony. democrats' line. caller: thank you for c-span. thank you for explaining to the ignorant person and getting back to the fax. in the louisiana, a lot of people are not aware that we still live under it the the polytechnic code -- the napoleon code. it is called white slavery.

quite a few years ago, there were quite a few men and women dancing in the cross hairs. they threaten to it that if they did not the eighth, they got sent away. that sent away for four to six weeks. there were not allowed to come back and tell ever sent them call that gave them permission. the threats he would see on these women's faces when the guys with look at them and tell them to go to the country, i mean, it is ridiculous to have anyone in slavery. who saw them get away with it in the 50's in the 50's your politicians knew what was going on. it was allowed.

it is all about greed and money. guest: it is about greed in money and the cruelty of the vulnerable. one of the things we have to make sure we are doing is to shift away from the idea that this has always happened and it always will happen or always will be -- or she must have been willing to do this because she was a prostitute in the past. that has to fall done in the face of the evidence. these have to be investigated. we should not assume. the evidence is not just looking at whether someone is a child prostitute. if they are an adult, we need to ask those questions. is there a pimp? is he using force?

whether in these beatings or psychological coercion like the notion of being sent away. this notion that pimps are abusing or they should be glorified, we need to see them as criminals. host: out of twitter -- guest: one of the things that is always tricky when you are doing investigations of these things is the prostitution advertising in the u.s., since it is illegal, advertising often masquerades under a legal function, whether that is an escort service or through the strip clubs. what we have seen is as advertising moves from his paper to online forums, there has been

wrestling with how to actually police that. how can a company -- craigslist took down their export -- escort services. how can a company screen fore these? we need to make sure everybody is on top of that. there are a lot of things being done right now. washington state just passed a law that says, if you are going to have escort advertisement on the web site or otherwise, you have to do the same thing that the people who do adult movie videos, you have to have proof of age for the people. they have to have their actors have occurred certificates to show they are not using children in those movies. washington state made a very reasonable step of saying,

verify the ages of anyone in these advertisements. police have to investigate. it could be those as court advertisement are not for prostitution. you cannot put someone in jail for what we know or believe we know. we have to do it based on the law and the facts. there needs to be investigation. and the things we saw up in washington state, that is a good first step. it is not just the bad things on the internet. there are other websites, as well. there is one on the back cover of the report, it is a place where you can go so you can actually calculate your slavery for print. even if you are not going to prostitutes yourself or holding somebody in slavery as a omestic servant or on a formar, the things that you buy, the

consumer habits you have, the impact supply chains that gore on the world. they may be filled by slave jaber -- fueled by slave labor. how many slaves worked for you? we encourage everybody, not just to look at the dark side, but look at the possibilities that it has. host: here is annapolis, maryland. republican line. caller: i have a quick question about bosnia's war. there was a lot of human trafficking and sex slavery going on. it was found out in investigating reports that it was the u.n. peacekeepers that were actually very much involved in that. the u.n. has been very criticized for that. it is reported online and other sources that whenever the u.n. goes in with their peacekeeping troops, this kind of activity really spikes. the sad thing is because they

have immunity, these people are not prosecuted. they are not held a can of a. -- held accountable. i was wondering if anybody watches that u.n. and what are they doing? how much are they involved in that kind of behavior? thank you. guest: this has been a problem. the bosnian war, the balkan wars of the 90's, brought everybody's attention. whether it is rape as a weapon of war or the wreckage of the moving armies, that has been a fact of life for so many centuries. i think what we are seeing now and whether it is in the work of the former yugoslavia and in prosecuting a another -- number of soldiers who inslee women

call it shows there is a rejection of the idea that a war zone should be zone of impunity. now, we see trainings for peacekeepers before they get deployed. we look at what is being done as far as peacekeeper training. you are right, the idea of extraterritorial jurisdiction, the u.s. has it. congress and look at a position and said, we should be able to prosecute our citizens if they inslee someone overseas. we are encouraging other countries to have that kind of extraterritorial jurisdiction. if your people are over there, especially if they're over there under government orders or in uniform, they should not be contributing to an trafficking. host: in africa, madagascar, zimbabwe comic-con go, -- congo, can you give context to

those colors? guest: the burgundy is almost better explained by the blue surrounding it. we have seen a lot of improvement in a lot of places as into a ministerial task forces are passed. prevention, protecting, prosecution. for the first time, we are starting to see innovative responses. zambia is a country that stands out. botswana is looking at cases with child of the stick -- type of domestic services. that brought together police and the ngo community. everyone is working to dismantle these criminal networks. there are other places in africa where we have not seen the same

type of response. some of them could be explained by how wartorn the call go actually is. there is rula law in many parts of the condo. go, in the parts of the cond where there is warfare, we need to make sure that it is not army officers that are involved with the idea of emptying out a village of inhabitants. the men to carry supplies. the children to fight. the women to serve as coax a and sex slaves. that is unacceptable. that is the understatement of the year. host: san diego. charlotte. democrat line. are you there? caller: yes, i am. how would like to know if

impatient utilization -- i understand that means when people are in hospitals and they are used in drug studies -- i think without informed consent, i wonder if your guest is familiar with that term and if he is not, if he could say who you should turn to if you suspect something like that has happened to you? guest: this is not something we cover in the report. i think a lot of the evidence around what kind of parameters apply to volunteer service to do not apply to this. the attorney general's office in sacramento and others would be the appropriate place to go to for more information or to report that type of thing.

i would like to read it look to the state and local officials, especially the ones to have the protection mandate, as does attorney-general. host: how much federal money goes to victims at what time of services to they receive? guest: there is not as much federal money for trafficking victims as one would hope. and there is a series of per- capita reimbursements for trafficking victims for about six months. at the end of the day, we are talking a budget across all of the u.s. government, whether that is for police training and clintoncare in other countries or the prosecutors, police come and agents who were working the cases. whether that is for victims of trafficking in trying to support the advocacy that is being done on their behalf of around the country. it is always hard to pin down a

particular budget number when it is across all those different agencies. when it is being done in different appropriations committees. around $100g million for a crime that involves at least 21 and probably 27 million people per year, worldwide. the crime comes to our fundamental values. it is not a criticism of the war on drugs to point out that all of the money that has been spent on human trafficking over the last 10 years, when aggregated, would you about three weeks to 1 months of the drug war. host: minneapolis, minnesota. good morning. caller: good morning. thank you for taking my call. is there politics involved?

he mentioned the lady who was working for gaddafi to get family. not long ago, i heard about 200 somali immigrants who were enslaved by libyans near benghazi. in north africa, that goes on all the time. and other countries that are close to the u.s. [unintelligible] i was wondering what the u.s. government is doing to stop that. guest: first of all, the situation that you mentioned of

the somali immigrants insulated libya, that is something i think we very much want to know about. if you have folks who know of that and they can get that information to u.s. embassy, it is something we would love to know about and we want to try to help with it, if we could be. as far as the alliances are concerned, in the middle east, you have countries like kuwait or saudi arabia, on the lowest level of the report. those are strong allies. we have seen countries in this last year be upgraded on the report based on what they have done under the law and countries like nicaragua, venezuela, which are not necessarily as close to the u.s. as saudia arabia.

the idea that the geopolitical is a part of this, what we try to look at is the fact and the law on the ground. the caller's point is well taken. this notion that this does happen in the gulf and as a result, we put this into our bilateral diplomacy with the individual gulf countries. we also look at this as something in with the gcc and regional partnerships. a perfect example of how far we have come, lacher at the international labor organization when we were looking to see whether or not the labor laws could be extended, the gulf countries were in favor of that. that not what happened two years ago. host: how often is this updated and what goes into the process of compiling the information to put together a report? guest: it comes up in june

annually. throughout the year, we do diplomacy. we work with these governments in with the international organizations. we maintain the foreign assistance budget, only $20 million to do trading around the world. then, we also -- our embassies go out and sit down with the governments. they go through minimum standards. they gather the data. they work with the civil society groups, the non-governmental organizations that are the ones that find the victims. we want to make sure that civil society and their voice is heard in the report. we not only have those kind of formal meetings, but we also want folks to understand and turn things into the federal register so we can gather is much good information as possible. we have seen the report described as the definitive

snapshot of human trafficking and modern slavery. we want it to be a resource, not just for countries or the academic world, but really a road map as to what we need to work on. over the coming year. host: this is the hard copy. can people viewed online? guest: they can't review it online at state trafficking.gov. host: think you for your time. of next, a discussion about work on the farm bill and other issues before the senate later on in the program. we're going to regular spotlight on the magazine series. the last days of m. f. global. peter elkine will join us. you might want to look up the story on our web site and get

inside before the segment starts. those discussions should take place after this update from c- span radio. >> an update on the 2012 election. president obama's campaign released two new advertisements today focused on it romney's record. he charges him with raising taxes and shipping jobs overseas while governor of massachusetts. in one of the ads, the narrator says as governor he did cut taxes on millionaires like himself but raise taxes on everyone else. meanwhile, politico reports that has jumped to the short list of several advisers. several sake mitt romney is weak and tim is strong. turning to the issue of health care, a new associated press poll finds americans overwhelmingly want the president and congress to get to work on a new health care bill

if the supreme court strikes down president obama's 2010 law. the poll finds more than three- fourths of americans do not want political leaders to simply do nothing. the decision from the high court expected by the end of this month. those are some of the latest headlines on c-span radio. friday's supreme court justice ginsberg talk aboutr the supreme court on the health- care law. >> a line that formed three days before oral argument commenced. some have described the controversy as unprecedented, and they may be right if they mean the number of press conferences, per circles, are protests, counter protest going on outside the court while oral

argument was under way inside. >> she also spoke about press reports on the decision expected this week or next. >> though deliberations are private, that has not dissuaded the media from publishing a steady stream of rumors. [laughter] my favorite among press pieces, widely observed at the supreme court. those who know do not talk, and those who talk, don't know. [laughter] >> what the rest of her comments on line at this to be in video library. -- at the cspan video library. from: the republican north dakota. the innkeeper joining us. where are we with the farm bill and what is left to do?

-- thank you for joining us. guest: we went through 29 amendments yesterday, which is a lot. we will try to finish up today if we can. we will start voting again at 11:00 this morning. we have some other business to do on the front end, but then right back on the farm bill. we will go at it all day and into the evening. >> the final bill has to take place by when? >> we are shooting for tonight or sometime tomorrow. >> we of a good bill. we brought it out of the committee with good bipartisan support. the key now is we work to hold it together. this is the last year of a five- year bill. a new bill is needed and also a five-year bill. an estimated cost of $969 billion.

guest: the actual cost is half of that. we saved more than $23 billion in this bill. it is a good bill that focuses on crop insurance, which is what farmers have told us they want. we are also finding savings for deficit reduction as well. >> what does the 23 billion cut need to be in my day to day business? >guest: it is about a 10% reduction in the program. at the same time, we really strengthen the safety net from the standpoint of emphasizing crop insurance. that is what producers told us they want to emphasize. it is more of a market-braced -- market-based approach. so it is -- we have some new aspects to the crop insurance that i think really strengthen the bill.

for example, the supplemental coverage option. a farmer will typically by his crop insurance, but then can buy a secondary policy on top of that. that provides coverage in addition to the crop level. that is very helpful. the third piece is the agricultural risk coverage, and that provides coverage where you have a weather pattern where you have repeated losses from year to year. >> our guest is here to talk about the farm bill and other issues. if you want to ask a question, -- there is a story in "the wall street journal" highlighting the fact that several in australia,

bermuda, switzerland that had acquired five of the largest crop insurance companies, and that is possible because the government covers the overhead and picks up the tab. the payment to the jurors are needed to make sure they do not drop out everest is like volatility increases too much. are these u.s. businesses or foreign-based. guest: these are u.s. businesses. we make changes to not only insurer, but only reduce the cost to the federal government. for example, we have taken billions out of the premium support. in addition to that, for years you have good loss experience. then the federal government recover some of the support. there is some upside now for federal government as well. we're trying to make the reforms

better and also make it more cost effective. host: does that mean a change in what is known as subsidies? is that how it works? guest: there are a number of changes reducing the amount, and providing government the opportunity for the upside years to get some of the money back. this goes to some of the steps we're taking to find savings. host: how does this and handle the topic of food stamps? guest: in our bill is about $4 billion reduction at a 4 billion. you mentioned the 10-year score. it is about 500 billion over five years, roughly 100 billion a year. only 20 relates to farming or ranching. 80% is nutrition payments. food stamps, supplemental nutrition programs. that is 80% of the bill. this provides very strong

support for food stamps, for school lunch programs, nutrition programs. that is why we say 80% of the cost of what is called the farm bill. host: lower support than before? guest: there has been such a ramp up, it is such a high your support. host: does the amendment change the final price tag of the bill? guest: so far some of the amendments would reduce the cost somewhat, but still pretty close to what we brought out of the committee. host: to your calls. north miami, florida. caller: i was curious. the total losses, whatever they end up to for the yearly crop,

that bill covers all of it. guest: that is not the typical way insurance works. the farmer selects his leverage predictable of insurance, just like other businesses would. you select the coverage. typically the farmer will make a decision as to what percentage of his costs of input he wants to cover. that is an individual decision. host: fairfax virginia. steve on the republican line. caller: are you aware of the authority project on the books? guest: i am not. caller: it basically redirect water from no. alaska rivers down to the rocky mountain trench and provides irrigation for both sides of the iraqi

rocky mountains. it would even boost the food production in mexico. guest: not a project i am familiar with, but something we can look into. host: galena, illinois. france is on the democrat line. rancis on the democrat line caller. caller: what is the safety net level in the event that the market falls? i will take your answer offline. thank you. guest: be included dairy program builds on the former program. it is complicated. that is certainly not my area of expertise, but essentially we consider with a program that is similar to the existing. this does provide help with what

we of historically done. i think you will see that will get additional work on the house side as we go forward. i know collin peterson from minnesota they have substantial dairy producers. i think you will see additional work, but it will build on the existing program. host: 265 million acres were injured nationwide. more than 23 billion were in north dakota. 5 billion paid up to u.s. farmers each year. north dakota farmers reach $220 million. guest: we of the highest use of crop insurance in the country. more of our producers sign up and enroll in the program that almost any state in the country. we lead the nation in the production of 14 major crops. whether you're talking week or edible beans, we grow incredible potatoes. a whole variety of crops. host: what are they insuring against?

natural disaster? bad year? what can they insure against? guest: it really goes to all of the above. premier li bad weather, disasters. that would be number one. crop disease and different things like that. host: from north dakota. 39.6 million. the average farm size is 1,200 acres. that sounds right. guest: we are a huge farm state and leave the production in many different areas. take of artificial safety net will drive hyperinflation and a plan market prices and state budgets. guest: the reality is good farm policy benefits every single american. we have the highest food costs in the country -- in the history of this country. this benefits farmers and ranchers. only 20 percent of the bill pertains to farming and

ranching. most of it pertains to school lunch program in food stamps, that sort of thing. it is not just the food supply, the jobs. millions of jobs across this country, and will million more indirect jobs. talking positive balance of trade. this is one of the sectors of our economy that has a positive balance of trade, which helps the overall trade. the final point that is very important, national security. what is it worth to us to not only have the abundant food supply of the most affordable in the world, but the fact that we did not have to depend on other countries for our huge supply is a huge natural security issue. think about that, if we had to depend on them for our food, that would be a difficult situation at best. it is a national securities issue as well. for all of those issues, we're talking about something that

benefits all americans. host: damascus, maryland. sue. caller: think you for taking my call. he was a terrific senator and great governor. having said that, how does the farm bill deal with what is happening to farmland, for to the league in north dakota with the fracking and oil companies? particular with a family member there and has seen the quality of like to carry it in now moving out, what do you do about the use of farmland by the oil companies in destroying the quality of life for citizens and people in the state? guest: think you for your question. without a doubt we have tremendous energy development in north dakota. we are the second-largest oil- producing country in the state -- oil producing states in the country. we produce a tremendous amount of oil.

we use hydraulic fracturing in order to tap the balkan and other formations that produce gallonsn 600 billion billion of oil. with that comes and challenges and growing pains. we're working very hard to make sure we meet the challenges. hydraulicmes it cometo fracturing, that happens to miles below ground. the state of north dakota has worked very hard on this. at the same time, we have infrastructure challenges. we need housing. we need roads. we need stores. we need to expand airports. we are now one of the fastest- growing states in the country. it is a priority that we address the impact that come with this

tremendous growth, and we're working very hard to do that at the local, state, and federal level. we have to continue. there is a lot of work to do there, and we have to continue to emphasize, making sure we developed infrastructure and maintain the tremendous quality of life we have always had. host: a viewer wants to know if this only exists for traditional farming? guest: one of the keys in the farm bill is an agricultural research, university-based, which i think it's incredibly important, and others that are making major breakthroughs and innovations, not only in the ability to produce food, but also fiber in fuel for this nation. it is incredibly important in terms of what we need. at the same time through rural development and other programs,

we are seeking to help foster the kind of innovation that farmers and ranchers are engaging in to be more productive. that is an important element as well. host: hannibal, missouri. good morning, mary. republican line. caller: i was watching mr., and i believe senator tom coburn made four proposed amendments. what would they be? and i would like to know if it were included in the farm bill, and if there were not, could you please explain why. guest: we have four amendments. jermaine amendments relate to agriculture or itself. a number of amendments that go to finding savings and efficiencies in the farm bill, and this will be voted on today. he has a non-germane the amendment that would reduce $36 million in funding that now goes

to the republican and democrat convention. on your tax return, when you check the box that you want dollars to go to the respective conventions, that is about 18 million for each of the conventions. his amendment would repeal that. he has for amendments, and that is generally what they relate to. that is what we will vote on today. host: 73 in total being debated by the senate. the cost is over a 10-year time. this is a five-year bill. waldorf, maryland. darnell on the democrat line. caller: i am thinking this is a big giveaway to big agricultural companies and companies like monsanto, companies that genetically- altered our foods. tomato today lasts a long time and has no taste like it did years and years ago. it has more acid, which is not a

good thing. i am wondering if people realize this is a big giveaway, just like the tea party said the reinvestment act was and the health care bill. where are they right now? how come they are being so quiet. t? guest: if we do find big reductions. if all other divisions took as big of a cut, we would be dealing with the deficit. we have payment limitations in the program so it does not go to the big companies like you're talking about, but rather emphasizing crop insurance where farmers pay a premium that is more market-based and cost effective. i still go back to what i pointed out a minute ago. every single american has access to the most abundant and affordable food supply, and your point about the taste of the tomato and so forth, we also support organic farming. if you have that option.

you can buy produce that is organic. you have that option. that is the strength of the farm program, it produces this abundant, the first supply so people can make their own choice. host: another topic. what is the likelihood june 30 will, and have a transportation bill? guest: working on that right now. i am on the conference committee. it is a two-year bill on the house side. they passed that bill. other elements to the bill from things they have been working on that clearly are part of the highway bill. they have been working on a five-year bill. at this point we are looking at a two-year bill. i think we're looking at strong backing. we really have to get it done pretty much in the next two weeks if we're for it to have it by june 30, otherwise we're looking at a six-month extension. i think we have a good chance to get it done. mr. day was a positive day in

terms of the conference. -- yesterday was a positive day in terms of the conference. i would say we're hopeful, but not there yet. i would say it is 50/50. i will do everything i can to get a highway bill. i think we all feel that way. we really have to get it done pretty much this week or next, or we will end up with a six- month extension. either way we will fund it at the same level, but in this highway bill we make major reforms. we take it from 90 down to 30. we give states a lot more flexibility. it has a really strong features that i think we need to pass. we are going to do everything we can to get it done, and i am hopeful. host: what is causing your concern about this? guest: it really comes down to a number of different issues between the house and senate. one of them is paid-fors.

essentially how we pay for the bill to make sure does that add to the deficit. there is a $12 billion shortfall in the trust fund, and that comes from the gas tax. there is about a $12 billion shortfall, so we had to make sure we make up the difference so we do not add to the debt or deficit. we have done that, but how the senate does it in house does it are different. i think we're getting close to resolving that. there is a whole range of issues that the restore, which relates to coastal restoration after the gulf oil spills. we have some provisions like keystone and coal ash we're working through. we have streamlined. right now when you want to build a road there are lots of environmental process these you go through. we of streamlining so the states can go in and build the roads and fix the roads. the states do the construction and management program. so these are the things we're

trying to resolve. hopeful we can. we have to pretty much get it done this week and next. host: is there a change in to how much gas tax is charged correctly? guest: no, this does not increase taxes. host: another popular thing talked about of the papers this morning, this is unpopular among those to pay for the interstate system. guest: right. the concern there being about paying twice. however, i think we have worked on a resolution for that issue. differences between the house and senate, but i think that is one we have resolved. host: how have you resolved it? guest: the federal government will provide the funding to the states, and the state will ultimately make that decision. i do not think the provision will be in there. the state will be able to make its own decision, and it will

not count against them in the federal formula that goes by your highway miles. host: joan spero, arkansas. i ran on the independent line. nsborough, ark.. caller: you talk a good game, but the senate is broke. we are broke. you pat yourself on your back while you were spending money we do not have, and the federal government says we will get the money to the state. you are borrowing the money. guess who will end up paying for it? we are. the people are. do not pat yourself on the back seat you are saving money. there are no trust funds. the democrats and republicans, you are spending broke. guest: when you talk about the trust fund, i think you're

talking about the highway bill. the of fully paid for that so it does not increase the deficit or the debt. in the case of the farm bill, it is not a trust fund issue, and we do save -- we are reducing 10%. if we continue to work across the budget in that fashion, we absolutely do address the deficit and the debt, and we need to. there is a lot more work to do here, but we're moving in the right direction. host: florida. dan on the republican line. caller: good morning. we are citrus business. there is a program, and it is like supplement above the crop insurance, which crop insurance is very good and had a few freezes a few years ago, but this is supposed to help the farmer, too. why has it taken so long to get anything done with this program? it will be two years before i

received any payment. guest: right on. that was one of the problems with the sure program. it was really slow and hard getting that out there. this is used for example when you have a freeze. that is why we take this program out and replace it with ag risk coverage, which you will ensure at whatever level you decide to for your farm operation or orchards. then above that, you can buy supplemental, which is county- wide assistance, and then sure program is gone, and we now provide the ag risk coverage, which provide additional coverage in case of a weather event, but in the same year, so you do not have the delay like you had with this program. you are right on that. it was complicated, difficult to

use, and slow. host: new haven, connecticut. caller: think you for taking my call. i notice we're eating a lot of beef in this country. i came across a north dakota quarter that had a buffalo on it. i think -- i have yet to see a lot more herds of buffalo. here in the east we have deer and bear in our backyards, and no one is eating them. apologies to my vegan niece and nephew, but i think we need more variety in our diets than just supporting cattle grow worse. growers.- cattle guest: we do. for example, in my state of north dakota we have tremendous amount of buffalo or bison raise

and it is a very lean and high- quality meat. we are moving into other areas. our ranchers are reaching a variety of different types of animals. i agree with you. host: you face the threat of imports of tree? guest: we want to promote trade. we have a tremendous, positive balance in the agricultural trade. we want to continue to expand the markets around the world. our farmers are the most productive in the world. it is an incredible opportunity. we can compete with farmers and in the country, as long as we're access to the market and treated fairly. that is the other part of the agricultural program that is important to talk about. we not only have to find ways to help farmers expand trade, but to make sure they are treated fairly and other markets. the point i made earlier about food security, for this country because we produce the food we need in far more and export it,

that is a national security issue and strength for our country. other countries are worried about their own food supply, so they tend to enact barriers. we have to be mindful of creating a level playing field. infield our farmers to tremendously well. host: nashville, tennessee. independent line. hello. caller: thank you for taking my call. would you please, on two things? first, labeling genetically engineered food. it seems like the popular polls are almost 3/4 would like to see what is in their food. this is been held up for many years. the second thing is national security. why are there so many people out of a job and on food stamps. set to put those two together? 50 million -- whatever, how can

we get more people to work in the agricultural fields and how can the government help? we need a stimulus bill that puts food on the table. that is a job, isn't it? guest: to your first question, did you provide labeling. the review that labeling. as food changes and food products change, they work to understand so that you know you're getting when you buy food products. that is ongoing and it will continue. as for the jobs issue, absolutely. the way to do it is not with stimulus. it is by creating the kind of legal tax and regulatory environment that will stimulate private investment. the keystone is a great example of something have brought up many times. that is the largest project ready to go in the country right now. more than $7 billion. but not one penny of federal spending.

it will help us move oil and create the thousands and thousands of jobs. it is about creating the right environment, whether it is agriculture or energy or anywhere else. we have to reduce the regulatory burden. when the tax reform so companies will invest. host: last friday the administration asked for an additional review of it. guest: right. that is what congress needs to approve the project. this is now been going on for four years. four years ago. we put 100,000 barrels of oil into the pipeline. it will take 500 trucks a day off of our roads that are

beating up our roads and creating traffic safety issues. back to the woman's questions about impacts. that is needed. this has been waiting for four yeras. you talk about why this economy is being held up. you cannot hold up major projects. you cannot do that for years and years and expect the economy to do well. that is exactly what i'm talking about. your state unemployment is at 3%. what do a tribute to those numbers? guest: i was governor there from 2000 to 2010. we focused on stimulating private investment. whether you look at energy or an advanced manufacturing or value

added, high-tech, tourism -- we are attracting all of those things. we are greatly expanding our international trade because companies are coming to invest because we created that environment. host: is a traditional energy? green energy? guest: yes. and both. all of the above. is really is. the administration says all of the above but in the hold of needed infrastructure for more than four years, now going on five. you have to find a way to power that investment so companies can make that investment and produce not only oil and natural gas, but also the biofuels. it comes from private investment. not from government spending. host: republican line. good morning.

caller: good morning. thank you for taking my call. i'll be 68 years old next month. i have seen the population of the united states just about doubled. the world population has doubled, too. the problem is, those kinds of situations. the problem i look at is, how do we feed everybody? if we have all those people, what will happen to our ranchers and our farm land? people like that? are we going to be able to feed people the way we are? i do not know there is anything we can do about that. people are people. i this kind of worry about it. guest: you know, back to why we need a good farm bill. it is not as rough farming. is about all the reasons i

talked about. you are right on. part of the reason ag research is so important is a week to make productivity gains. but our farmers and ranchers are not doing it. they have been tremendous. we not only feed the much larger population, we are taxed -- we're exporting now more than we ever have. it goes to amazing innovation. host: we have a view that asked about food costs. what does the bill due to lower the cost to the consumer? guest: look. fundamental law of supply and demand. more supply it brings costs down. it not only has to be cost- effective, which this farmville

is, it has to have the kind of support that our farmers and ranchers need to produce more food supply. that is what we're doing. again, a growing economy, very important as well. it is getting $13 plus there's a big -- $13+ million -- 13+ million people back to work. host: one more call from dallas tx. good morning. democrats line. caller: good morning. my name is william. i am a disabled vietnam veteran. i am wondering, how come it has taken so long for the congress

to award the black of farmers the award the one about 10 years ago? guest: first off, i do not know the answer to your question but i'm willing to look into it. and i want to thank you for your service. we appreciate some mature service in vietnam hear. for 10 years, our soldiers, men beeniwomen in uniform have serving in iraq, afghanistan, and places around the world. host: senator mccain was in your state not too long ago. he was quoted. he made the case for u.s. a strong vice-presidential pick for mitt romney. guest: i do not think that is too likely, but it was very nice of him to say. we loved having him. to combat to fargo to our air

force base. -- we took him out to our base in fargo. he took time to greet our air men and their women. he thanked them for their service. >> have you had any conversations with the romney campaign about this topic? guest: no. we crossed over as governors. i got to know him as governor. i think is a great candidate. host: thank you. guest: thank you. it.reciate co host: we will look at key congressional races. they take a look at key races

and topics. joining us for that discussion will be julie sobel. to launch this series, we're taking a look of the north dakota senate race. julie sobel, why is this race important to look at? guest: it is interesting, as most people did not think this would be one of the most competitive senate races in the country. this is a state where the president is definitely very unpopular. the have not voted for a democratic president since 1964 in north dakota. before 2010 had two democratic senators and members of congress. but in 2010 the state took a sharp right turn and replaced the senator with the center that

was just on the show. the conventional wisdom was that the senate seat, when kent conrad and retired, would go to a republican. that convention has been turned on its head. the democratic nominee is a former attorney general. so far, she seems to be doing everything right. a mason-dixon poll last week showed her one point ahead of him. it seems like this will be one of the competitive races of 2012. host: the primary is when? guest: it was last week. they have the nominees. host: when is the reason they want to be elected to this position? guest: everybody is talking about energy in north dakota.

obviously, the oil boom has helped the state to 3% unemployment rate, which is amazing. far below the national average. there are projecting north dakota will have a surplus next year thanks in large part to this energy boom. energy is very important in the race. it is a place for a lot of people disagree with the president in the state. it is a place for her to put distance between herself and the president. on the issue of the keystone pipeline she has to drive a wedge between herself and the president. she has tried to put difference between herself and the president on coal, saying the president has not done enough supporting clean coal technology. meanwhile, the republicans are trying to tie her to the president at every turn.

host: julie sobel is our guest. we're going to play two ads back to back off from the campaign. and then a we come back, a coin -- a couple more questions for you. [video clip] >> and she supported obama care. >> this bill will change the face of health care. >> she is right. >> this unelected bureaucrat, costs and premiums are likely to go up. that is not the cost we need. tell her that obamacare is wrong for north dakota. support the new majority agenda. [video clip] >> 12 years ago, i'd be breast cancer. when you live to that, a political attack ads seem silly. i would never vote to take away seniors' health care.

there is good and bad in the health-care law, and it needs to be fixed. but he voted to go back to denying coverage to kids with preexisting issues. i approve this message because i do not ever want to go back to those days. host: two ads. tell us a little bit about them. who is participating? guest: that first one is a crossroads gps ad, which is karl rhodes group. they're going hard and try to link her to the president's health care bill you saw that they had old footage ever been supportive of the bill. she cannot fully run away from it. she confesses she does not support it at all. what you saw next was a response which was run last week. in her response, it was pretty much the most bold, direct

approach that any democratic said it -- senate candid has taken to answering that attack. she has a personal experience that she talks about in the beginning. she said there is good and bad and the law. also, she tries to go on the offense, which you have not seen before, accusing her opponent of wanted too help -- of tw cut health care for children. there was another one that was very similar in content. she has chosen not to let the attacks go unanswered. host: how do both campaigns a stand in terms of money? guest: they have both been raising the money. it should be a tight contest. the thing about north dakota is

less money as a long way over the airwaves. you know, these outside groups can put in a lot less to compete. you're seeing a lot of outside group participation already in the state. also, they have made two independent expenditure eds. both have been in north dakota tying him to washington and at the gop. you'll probably see a lot of outside money common. host: do we expect a debate between these two candidates? guest: yes. there are committed to one the day and they're likely to work out some more as well. host: have either side recruited people to help them in their campaigning? guest: i have not seen outside

campaigning coming in to north dakota. i do not think it will be unlikely, but obviously will not see the president come in or wanting any national figures coming into the state because i would not be helpful to her. host: julie sobel is participating. this time we're looking at the north dakota senate race. thank you for your time. guest: thank you. host: one more segment to go. this time we will take a look at our fortune magazine. we will be along for that discussion in just a couple of minutes. >> next month, the award winning author and historian david

pietrusza. he has one dozen books. including 1920, the year of the six presidents. and 1960, lbj bursas jfk versus nixon. join us live with your calls, e- mail's, and tweets. "washington journal" continues. host: our guest joining us from texas, peter elkind. we're taking a look at the last days of mf global. thank you for your time, sir. guest: good to be with you. host: just to remind people, can you talk about mf global that's what it does?

guest: sure. it was primarily a futures broker. it traded futures, metals, and financial futures. it was a fairly big firm in that business. the key player in business was jon corzine. the ceo of the firm. before that, it was a top guy at goldman sachs. both senator from new jersey and then governor from new jersey. host: its elevated a firm that no one had ever heard of to infamy and shattered a broken trust. can you take us through those three elements and painted picture of the larger issue of mf global, starting with mr. corzine himself?

guest: sure. he was a famous man. he had run goldman sachs. and then when he was ousted after a long and successful career, he immediately went into politics. he spent an enormous amount of his own fortune to get elected to u.s. senator. he was elected governor of new jersey. after four years, he was defeated for reelection by chris christie. at the age of 63, he was trying to decide what to do. he turned down opportunities to sit back and make a lot of money. he accepted a senior advisory position instead. he was offered, out of the blue, a position to serve as interim ceo.

at a pretty obscure, brokerage firm. publicly traded, but fairly unknown to the general public. the folks who offered it to him, old friends of his, private equity operation, did not think he would take it. he thought was too much as ceo and too little company. he said he would take this offer only if he got on a permanent basis. lo and behold, he became ceo of mf global. that was 2010. host: he gets to mf global and starts a series of steps that would eventually lead to the company'semise. what were those steps? guest: is a board to understand that the reason there were such desperate straits is because there ceo had abruptly resigned.

their weak capital structure to begin with. the rating agencies had a gun to their head. the firms submit head was two steps above junk status. and the previous ceo resigned, there really were in a position where they had to come up with something to keep everybody happy and avoid a real sense of chaos at the firm. he came in. as i said, he added difficult situation in the first place. what he did was immediately recognized. the company was, as one director put it, a big dent on interest rates. it survives not by trading commissions, but taking in customer deposits. and then investing those

customer deposits and making some money or net interest that way. that had been how the firm had remained in the black. when interest rates first went to 0 in the financial crisis, his profits disappeared. did you come up with a new business model, essentially. his model was to take risks. to invested and find ways with trading income. eventually that led him in late 2010 to invest in european sovereign debt. host: peter elkind, our guest from fortune magazine. we will continue our discussion. if you want to know more, here is how you can do so. the number to call for our republican line is 202-737-0002. the number to call for our democrat line is 202-737-0001. the number to call for our independent line is 202-628- 0205.

tweet us. send us an e-mail. mr. kors in invested in bonds. what happens after that step? guest: well, what they invested in was european sovereign bonds. increasingly, because it was successful, he made it bigger and bigger. eventually they had as much as $7 billion. people both inside and outside the firm got increasingly nervous. host: at that point, after the investment of these bonds, was there a tipping point? guest: there was a tipping point. the european debt crisis got

worse and worse over time. initially, when they invested in this european debt, it was almost like investing u.s. treasurys. the counterparties did not require much to except the investments. it became clear that there was really a possibility that was not just inconceivable, there was a real fear that some of these european nations were the help bonds, ireland, portugal, italy, were shakier overtime. the counterparties required more and more collateral. more cash and security to maintain this investment. mf global did not have a lot of capital. as time went on and more was demanded, profits with other businesses. they got into a liquidity

squeeze. one of the things kors in was simultaneously doing, he was using this trading that mf global had never engaged in before as what he called a bridge. he's using it as a way to survive long enough to keep them from downgrading the firm to get to a point where all these new trading businesses he was creating, where the profits would kick in. and allow them to become a miniature goldman sachs. he was simultaneously trying to transform this firm in a very rapid order. he was trying to keep all alive by juggling the ball through this repo to maturity trade. is a method of investing in sovereign debt. host: peter elkind.

the story he wrote, the last days of mf global. here is austin, texas. mike on our independent line. go ahead, please. caller: yes. i was hearing someone spitting on one of these programs. he was saying that it wasn't only bad investments, but mf global landed to personal accounts that were not supposed to be touched. can you elaborate on that? but you think anybody will be prosecuted? host: peter elkind, go ahead. guest: those are critical points. that disastrous, final week that brought about the firm's collapse. what happened was this cash squeeze, this liquidity squeeze of a very fragile firm.

as we put it, trying to build bicycle tires. it all fell apart in the final week. there were enormous cash demands. the norm -- the firm got a terrible earnings report. it was downgraded repeatedly during the final week leading up to halloween of 2011. over the week, it entered a huge crisis. in this chaos where customers were drawing money, counterparties stopped lending money to mf global, in this chaos, they're trying to keep everything afloat until the confined a buyer. in this process, mid-week, that wednesday, it appears to be the first time they dipped into customer funds.

the way things are set up, strange structure. it is also mean gold mixed. there is a cushion to make sure you always have 100 cents on the dollar. well, there's not a fine line in terms of moving parts. they have different values minute by minute. you should keep a substantial cushion in there and not touch the house money. mf global, in these terrible, chaotic days, did get the money because it was so desperate for cash. it is unclear what they did out of the chaos. it is unclear if they did it by accident periods it was coming from trades they had settled. in any case, it appears by

wednesday they had dipped into customer funds and a $300 million short. it only got worse and worse. ultimately, by the time they went bankrupt, the bankruptcy trustees chocolate a discrepancy of $1.6 billion between what customers are owed and with the firm actually has in its customer accounts. for complicated, crazy, regulatory reasons, they were trading on foreign exchanges. it is subject to european rules. not u.s. rules. there is promise 6 $700,000 of there. -- six and a thousand dollars, $700,000 over there. -- $600,000, $700,000 over

there. right now, the number is missing. it is short. it is estimated by the trustee to be $1.6 billion. this is quite extraordinary. customer money has never been missing like this in this business. it has become an enormous scandal. it will take years before some of that money comes back. it is subject to all kinds of competing claims. we will have to see what happens. it is the bankruptcy trustee who is charged and another trusty who is charged with trying to get the general creditors. they're fighting or the money to some extent. that is where that is. on the issue of whether anybody will be prosecuted, that is unclear at this stage. the bankruptcy trustee has concluded that there are civil claims against kors i, against

the ceo of the company. there is a justice department investigation going on. the sort of things take a long time. does not appear to be any smoking gun at this stage. host: republican line, go ahead. caller: this is a follow-up to you said before. specifically, why would anybody be charged or even arrested at this point in time? as a former member of the mercantile exchange myself, this is verboten behavior. you never touch funds. whatever problems conducted by the fbi and the mercantile exchange, and all that, whatever has happened in the past is minuscule compared to the scandal that core design has brought.

i'm wondering if that could be one of the many reasons that patrick fitzgerald might have resigned from the u.s. attorney's office with tears in his eyes, because maybe he is being hamstrung since kors time is a political operative of the obama administration. 9 jon corzine is a political figure of the obama administration. guest: i agree with part of your question. you'd think it resulted credit corp. -- in criminal charges. it might. the absence of e-mail from kors corzine, that will get a smoking gun case.

one key person in the whole situation is -- she is the person who was sort of the air traffic control of cash. she complained about how this was a problem for months. she had to move money around from place to place. she has taken the fifth when asked to testify before congress. she is reportedly seeking a deal with federal prosecutors before she will tell her entire story about what happened. she was very much in touch with how to meet some of these cash demands. we do not know what she will say. that is one way potentially critical charges could be brought.

in terms of the notion that there is a grand conspiracy out there, that office is famously independent. at this point, he is not a popular guy. the notion that the justice department is protecting him seems improbable to me. it is unclear whether they will be delivering charges, but i am skeptical that there's any effort to protect him because of his relationship with barack obama. host: austin, texas. democrats line. caller: thank you.

as someone whose money was taken out of my personal account without my authorization and without my direction is now being handled in one of the most bizarre procedures i have ever imagined could occur in this country. i am not going to characterize our government, but i will say that the bankruptcy procedure seems to be reminiscent of something that might occur nowadays in russia. guest: that may be a flattering characterization. it is an extraordinarily strange process. we have two bakers the trustees. -- two bankruptcy trustees. you'd think they have a unified purpose to reclaim as much money for the people who are owed money. but the regime, the protocol, the rules, the law, are all very

complicated. who gets the money first? the customers? the u.s. customers? if you have money overseas, that is subject to a whole different set of rules. i sympathize not only with the situation, but your comment about it being reminiscent. it seems and tabled. it really is. host: pennsylvania, republican line, good morning. caller: good morning. this is a fascinating case. we're looking at an illustration of what happened as the result of the corruption of money in politics. coup was thet implementation of the treasonous john roberts on the u.s. supreme

court. jon corzine will never go to jail. everyone of us knows it. everyone who has any weight in politics and finance, they know they are protected. the entire nation is sick of this business. host: just to add, peter elkind, an addition from facebook. guest: i do not think this is a partisan issue. i think they have a tremendous job going after all wherever they see it. i understand the impatience and skepticism about this. i do not think it is the result of a political conspiracy.

host: new york, good morning. new york, are you there? on our line? so, as far as the internal structure of mf global, why? who was there warning mr. kors time? are there reasons why he did not listen to possible warnings? guest: well, the whole dynamic in their had a lot to do with what happened. this was a company that was fragile when he arrived. in a rise of this ceo. he was very famous. goldman sachs was 100 times the size of mf global. not only was he the ceo, but he was the ceo they deserve in some ways. having said that, when he came

up with his efforts to scheme his plan, to try to transform the company and save it until it could transform it, the board was absolutely briefed on every step of the way of the strategy. they discussed this on european debt in great detail. the risk officers brought it to the board and discussed it with him. there were monthly updates. literally, all through the first six or seven months of 2011. the board approved this. jon corzine worked repeatedly to increase the size. they approved it. they never said no until much later in 2011.

that is something that is important to understand. host: the victoria on twitter asked what is the law that made this illegal? what happened to that law? guest: the investment itself was not illegal. what is potentially a criminal violation is unquestionably a relationship that never should happen -- the use of customer money. the role is required to be kept in separate accounts. this cannot be used by the firm. it is clear that a lot of this money.

my question is whether someone did that deliberately. that is what is potentially illegal. there's also the potential of fraud. false statements made in public disclosures. there are a lot of issues there. host: independent line. caller: yes. i am interested in how is it that the government can find $5,000 in the count the eliot spitzer had put away, it is like they cannot find out what happened to $1.2 billion. that seems ridiculous to me. guest: i understand your frustration. i've written books about eliot spitzer some kind -- some time ago.

there are a lot more moving parts of mf global. a lot more money has been misplaced and at stake. is is not so much that they do not know where the money is. it is a question now largely of getting it back. a lot of it is in london. a lot of it is in the hands of counterparties who were doing business with mf global in some way. the question is, who gets it? in the final days of the firm's survival, the firm's alive, they're desperately trying to sell every asset they have. that required finding somebody to buy it. and for the cash associated with the securities to be returned to mf global. when everybody got the smell of trouble, when the couple with an small blood in the air and saw mf global was in bad shape, everyone, especially the folks

who were owed money, like jpmorgan, slow down the process of moving money back to the firm. they basically wanted to have their hands on the cash. money put that was supposed to go through the pipeline and in some cases, customer money, as it turns out, stopped. it was left in place at jpmorgan. now, the trustee has identify where all of this $1.6 million -- $1.6 billion is. now there will be a big fight. they're going to try to get it all back. it is not so much they cannot find it. that defined a who belongs to. host: we're talking about the last days of mf global.

national, illinois. tammy, independent line. hello. caller: yesterday i had a question for civil unions. our new governor install the periods nobody knew anything about it. i went on line and found out that you did will be only for homosexuals. that is discrimination. about mfre talking global. what is your question about that? to triedhey're going to curtail medicare. i'm a veteran. i had to have a liver transplant. now they're saying one person, for drugs. host: let's move on to an

atlanta, georgia. michael, independent line. caller: yes. i have a question in reference to this issue why are the attorney-general -- why is the attorney-general not holding these guys accountable? invest our money. host: which regulatory agencies are overseeing this process? guest: you would think that would be a simple question with a simple answer. but it is not really, either. there were at least six agencies that had some piece of overside with mf global. there were a couple of primary regulators. because it had both securities customers and also features customers. they have been delegated these

responsibilities, several of which were industry self- regulators. the oversight of this firm was very much split up. the rules are complicated. it is kind of a crazy system. ultimately, when mf global ended up in collapse and a near collapse, there were like eight or 10 regulators on the scene trying to figure out what to do. it was possible to shuffle assets from one side to the other. and to avoid scrutiny. host: rich on our republican line. caller: good morning. thank you for taking our call. you can look at this jon corzine

guy and then jamie dimon. i do not understand. they went after madoff. he is bankrupt and in jail. jon corzine seems like what they're sorting this out of out he should either be indicted -- and they invite people for a whole lot less than that. all of his assets should be seized. and then you have jamie dimon and has half the people that are asking him questions used to work for him or are on his board. this stuff is beyond -- i have a small business. if i ran my company like this, they would have me in jail. i guess the whole idea -- i'm sure it's not a conspiracy, like you mentioned, but there is a

whole lot of dirty stuff going on. this is probably just the tip of the iceberg. maybe that is why the economy is not getting going. when the conglomerate said the audience says there is something not right, i think you guys ought to take that to heart. comments off your the air. thank you. guest: yeah. i understand that sentiment and i think you're exactly right. something is not right about it. that is why i am working on the story. terrible things happened here. the notion of taking customer money and losing track of it for the use of private purposes is outrageous and shocking. but there is inevitably this

long, painful process that takes place and should take place. but i understand in the visceral sense. this financial world does not understand how the real world operates. it plays by different rules. it is a terrible thing. there is a failure to appreciate outrage, i think, in main street about all the things that wall street does and gets away with. and the way it behaves. that is obviously an issue for washington to sort out. but i understand the rage and shock about how business is done. sometimes it is just bad business mistakes. sometimes it is illegal. sometimes it is what is legal that is most shocking -- not what is illegal.

caller: you said before politically that jon corzine seems to be toast. no one wants to associate with him. however, he is the second largest funder for barack obama. so how could you really expect any law or any criminal actions to come after him while he is the second-largest funder for obama? to expect the attorney general, at this time, to prosecute a man who was siphoning money to obama? no. this is what the problem is. we have no faith in our justice situation anymore. nor do we expect from the elite to prosecute one another.

guest: well, he was without question a major fund-raiser for barack obama. in fact, the senate played a part in launching obama's political career. however, he is not a fundraiser now. just as the bush administration was willing to appoint a special justice department task force to prosecute folks at enron and a successfully did so, can lay was convicted. he died before he appealed his case and went to prison. the republican administration was willing to do that and did

do that. camouflet was close to the bush family -- ken lay was close to the bush family. they are capable of doing whatever they need to do in investigating mf global. at this point, the political points to be scored are going after jon corzine, not protecting him. they will go where the chips fall and will pursue this case if there is a case to be made. the track record that have had in recent years has not been very good. i do not think there is a grand political conspiracy. host: do we know what mr. kors corzine is doing now?

guest: he is laying low. i heard he is spending time with his grandchildren. he is a notorious workaholic. he's not doing what he wants to do which is be back in business in some form that is kind of his makeup. even at the age of 65. he is obviously not in any position to be doing that with anybody. host: virginia beach, independent line. caller: what good is the curriculum of accounting is the largest trust that too big to audit, too big to fail organizations do not have to use any accounting practices? just look at the paper trail. there is double entry accounting practices that should be

followed. long before there is a problem that reaches this level, it should be found. put some accountants in jail and they will start talking. in your research, what have you said? if you are real about getting to the problem, start with the accounting. guest: that is an interesting issue and a good point. that was true at enron and mf global. the accountants were not in a position to know a lot. and in particular, and part of it is the county regime that exists. what is legal, not illegal. for example, if the european sovereign debt trade that jon corzine made were driven by oddities of the accounting rules. because the way he made these trades, $6.3 billion was through

eight repo to maturity. a repurchase to maturity action. he financed the bonds with a lender and actually -- and would profit on the amount of interest they made and through the complexity and way they made this deal, there were able to book profits and the trade. off thenot actually pay hand for that time. because of accounting rules, they could book the profits up front, right away, when they made a deal. that allowed them to make profits in the short-term that allowed the entire firm to be in the black. at least that was the goal.

that did happen and at least one quarter. mf global book enough to be profitable for one-quarter. but that was an oddity of the accounting rules. jon corzine was exploiting that to keep the firm alive. it was an accounting driven aspect of the trade. there is one director of the company that hated it. he asked him, if you had to do this in a normal way, would you have made these trades? of course, he said, absolutely not. too much volatility in the firm's earnings statement.

because of the profits of front, and because he did not have to show on its balance sheets, because of these crazy accounting rules, it caused a problem. host: there is a story from bloomberg's saying that one of the trustees involved said there was no time monitoring liquidity from mf global. guest: yes. one of the big problems was the whole infrastructure in terms of people, computer systems, in terms of rules and approvals, was far too weak. there were a futures of brokerage historically. they're trying to become my goldman sachs. that is this new approach to business that jon corzine was implementing. it was part of the problem.

they literally did not know how much cash they had. host: what has been the impact, if any, on a similar-type of firm. guest: they have rushed to get rid of any sovereign debt they have that is not disclosed. one firm was reported to have had some sovereign debt, and they dumped it on an emergency basis. there was tremendous fear that any firm that had sovereign debt might be in the same position as mf global. in addition, many firms rushed to say, we do not touch our customer funds. we keep in place and did not tap day-to-day needs. certainly many protests of, your funds are safe with us. there was a lot of t