i think in his press release i gather he was referring to the observation that was made a day earlier that it had now been a year since the senate have passed a strong bipartisan bill, and although we have heard a lot of talk about the house republicans being interested in doing something, nothing had happened yet. and suggesting we need urgency here. i still feel the same way. i know there are republicans in the house, and in the senate, who know this is the right thing to do. i also know it is hard politics for republicans. because there are some in the base that are very opposed to this. but, what i also know is there are families all across the country who are experiencing great hardship and pain because this is not getting resolved. i also know there are businesses across the country that could be growing even faster.

that our deficits could be coming down faster. that we would have more customers in our shops, if we get this thing resolved. we know what the right thing to do is. it is a matter of political will. not any longer a matter of policy. i will encourage them to get this done. as far as our actions, and jeh johnson, new head of the department of homeland security has been talking to everybody. law enforcement, immigrant rights groups to do a thorough review of the approach towards enforcement, and we are doing that in consultation with democrats and republicans and with any interested party. i do think that the system we

have right now is broken. i am not alone in that opinion. the only way to truly fix it is through congressional action. we have already tried to take as many administrative steps as we could to make it more consistent with common sense and more consistent with the american people's attitude which we should not be in the business of tearing families apart that are otherwise law-abiding. i will not get into timing right now, because mr. johnson will go ahead and do that review. >> so regarding the affordable care act -- >> let's talk about that. [laughter] >> i think everyone agrees it has flaws, but democrats have been reluctant in congress to reopen the conversation, and

republicans have been more than happy to reopen conversations in a different way. now that you say it is here to stay in so many people have signed up, in this environment is it possible to do the kinds of corrections that the business community and many others would like to see through small, technical corrections? >> it is absolutely possible but will require a change in attitude on the part of the republicans. i have always said from the outset that on any large piece of legislation like this there are going to be things that need to be improved. i said that i think the day i signed the bill. i do not think there has been any hesitation on our part to consider ideas that would actually improve the legislation. the challenge we have is that if you have certain members in the republican party whose view is making it work better is a

concession to me, then it is hard in that environment to actually get it done. i recognize that their party has gone through the stages of grief, anger, denial, and all that stuff. we are not at acceptance yet. but at some point, my assumption is there will be an interest to figure out how to make this work in the best way possible. we have 8 million people signed up. through the exchanges. that does not include the 3 million young people who are able to stay on the parents plan. it does not include the 3 million people who benefited from expansions to medicaid. so if my math is correct, but it's 14 million. another 5 million people who have signed up outside the

market places that are part of the different insurance pool. so we have a sizable part of the u.s. population now better in the first time in many cases in a position to enjoy the financial security of health insurance. i am meeting them as i am on the road. i saw a woman yesterday, young woman, maybe 34 with her mom and dad, two small kids and self-employed husband and diagnosed with breast cancer and this is not an abstraction to her. she is saving her home and business. she is saving her parents home potentially because she has

health insurance, which he just could not afford. the question now becomes come if in fact this is working for a lot of people but still improvements to make, why are we still having a conversation about repealing the whole thing on and why are we having folks say that any efforts to improve it are somehow handing obama a victory. this is not about me. my hope is we start moving beyond that. it seems as if this is the primary agenda item in the republican political platform. here is what i know. the american people would much rather see us talk about jobs, would much rather see us talk about high college costs, would much rather see us talk about how to rebuild our roads and bridges and infrastructure and put people back to work. they would much rather us talk about how we can boost wages and improve their individual family bottom lines.

if the republicans want to spend the entire next six months or a year talking about repealing a bill that provides millions of people health insurance, without providing any meaningful alternative, instead of talking about jobs and the economic situation of families across the country, that is their prerogative. at some point i think they will make the transition. that is my hope anyway. if not, we will keep on doing what we are doing which is making it work for people all across the country. i'm sorry, i'm going to say one last thing about this. just because this does frustrate me. states that have chosen not to expand medicaid for no other reason than political spite. you got 5 million people who could be having health insurance right now at no cost to these

states, zero cost to these states other than ideological reasons they have chosen not to provide health insurance for their citizens. that is wrong. it should stop. those folks should be able to get health insurance like anybody else. >> given all you were saying about the affordable care act, do you think it is time for democrats to start campaigning loudly and positively on the benefits of obamacare? on ukraine, you said in other situations that the military option remains on the table even as talks go on. is the military option on the table with russia, and if so, would that be through nato forces, or through other aid to ukraine? >> i have said that other military options are not on the table in ukraine because this is

not a situation that would be amenable to a clear military solution. what we have to do is create an environment in which irregular forces disarm, that the seizing of buildings cease, that a national dialogue by ukrainians, not by russians, not by americans or anybody else, but by ukrainians, takes place, and they move forward with reforms that meet the interests of the various groups within ukraine, they move forward with elections, and they start getting their economic house in order. that is what is going to solve the problem. and so obviously, russia right now still has its forces amassed along ukrainian-russian border as a gesture of intimidation,

and it is our belief and not ours alone, but the broad portions of the international community, believe that russia's hand is in the disruptions and chaos that we have been seeing in the southern and eastern ukraine. there is an opportunity for russia to take a different approach. in the meantime we will repair and additional responses should russia fail to take a different course. we have had an impact on the economy that is well documented. it could yet significantly worse. we do not have an interest in hurting ordinary russians for that sake. mr. putin should follow through on a global hope coming out of these geneva talks, but we are

not going to count on it until we see it. we will prepare for other options. with respect to the affordable care act, my point is that we have been having a political fight about this for five years. we need to move on with something else. that is what the people are interested in. i think democrats should forcefully defend and be proud of the fact that millions of people like the woman i just described who i saw in pennsylvania yesterday, we are helping because of something we did. i do not think we should apologize for it. we should not be defensive about it. it is a strong, good, right story to tell. what the other side is doing an offering would strip away protections from those families and from hundreds of millions of people who already have health

insurance before the law passed, but never knew if the insurance company could drop them when they actually needed it or women who were getting charged more because they were a woman. i am still puzzled why they have made this their sole agenda item when it comes to our politics. it is curious. but what i intend to talk about is what the american people are interested in hearing, our plans for putting people back to work our plans for making sure our economy continues to grow, our plans to make sure that we are training people for the jobs that are out there right now and making better use of our community colleges and linking them up with businesses, and how we will continue to bring manufacturing back the way we have over the last several years, and how we are going to put more money in the pockets of ordinary people. so if they want to talk about

repealing a law that is working, that is their business. what democrats should do is not be defensive, but we need to move on and focus on the things that are really important to the american people right now. >> thank you. there are people who object to the law and say they have had problems with the law, and there are significant. numbers of opponents of the law what makes you think a significant majority of the american people will accept this law, or are we destined to health care, 50-50, red state, blue state? >> you said there are people that say there are problems with the law. that is not the majority of the people. there may have been folks who are affected in ways they are not happy about why the law. that is a far smaller number than the millions of people who have been signed up. that does not mean we should be

concerned about it. that is an area where we should be open to, ways that we can make it even better. that is objective facts and real problems out there. the other side is just polling, what is the general opinion of the law, which is attached to general opinions about me and democrats and partisanship in the country generally. my view is that the longer we see the law benefiting millions of people, the more we see accusations that the law is hurting millions of people being completely debunked, as some of you in the press have done, and the more the average america who already has health insurance not

affecting them in an adverse way, it becomes less of a political football, which is -- it should not be a political football. it should be something we take for granted, that in this country you should be able to get affordable health care regardless of how wealthy you are. the larger issue, whether we can move past the polarization and the bitter political debates between democrats and republicans, of which obamacare is just one small part, that is going to take more time. but it is not for lack of trying on my part, and i think that i speak for all democrats in saying we would much prefer a constructive conversation with republicans about how do we get stuff done, and let's focus on areas that the american people

really care about. on jobs, we know infrastructure would put people back to work now and improve our economy in the long term. it used not to be a partisan issue. why don't we come up with a way to make sure we are rebuilding our roads and bridges and improving our traffic control system? there is no reason that has to be political. there really is not any ideological disagreement on that, and i guarantee you after this winter, if you look at the potholes that are all across big chunks of the united states that people would like to see an infrastructure bill. let's get it done. >> how long do you think it will become before health care not become a political football? >> it is hard to say. i was at the lbj library the other day, and most of us want

to pay close attention to those debates, because they are distant now in the past, but that apparently took several years before people realized the medicare actually works and it is lifting a lot of seniors out of despair and poverty. but we have been through this cycle before. it happens each and every time we make some strides in terms of strengthening our commitments to each other, and we expand some of the social insurance programs. there is a lot of fear mongering and a lot of political argument and debate and a lot of accusations that are flying back and forth about socialized medicine and the end of freedom and then it turns out that it is working for a lot of folks and we still live in a free market society, have the constitution intact, and we move on. i do not know long how long it

is going to take, but in the meantime, how about we focus on things the american people care about? thank you, everybody. >> [indiscernible] >> one of the signatures of this boom is how quickly it has moved. there is good and bad about that. we were 10 years into the boom before regulators and the companies themselves started asking tough questions. what is going on with the missions? what about all the water we are using? where will we injected? isn't some of the water causing earthquakes?

these are important questions. one of the mistakes we made is we were so far into the boom before we started asking questions. the good news is, when you start looking, there are answers and solutions. ways to do it better. >> russell gold and the good and bad news of fracking. he is one of the authors at the san antonio festival. coverage starts at 1:00 p.m. eastern. watch two-time winner of the pulitzer prize alan taylor. about aed -- writes little-known episode in the history of slavery. ook club, read the wrong war and join the conversation. the federal aviation administration has named virginia tech one of six federally certified sites for unmanned aircraft research.

guests -- john green, head of the mid-atlantic aviation partnership. you can see washington journal live tomorrow morning at 7:00 a.m. eastern. washingtonfrom the journal this morning, a discussion about the economy five years after the financial crisis. >> our next guest is the author of the road to global prosperity. good morning. thanks for being with us. fessor at johns hopkins university. thank you for being with us. guest: pleasure to be with you. host: one of the quotes that summarizes the thesis, you write

makes sense. not always the reality. guest: not always reality, and particularly difficult for the global economy. stability is provided by government but there is no world government, but there is a world economy. who provides the framework for the global economy? the answer is we do. the united states does. this is one of the great services -- indeed, i would say the greatest service that the united states provides to the world. for a variety of reasons, but the fact is that, for example, the american navy patrols the sea lanes over which most trade passes. without the american navy the trade would be more difficult. the united states is crucial for the smooth function of the global economy. host: as you look at the ongoing

tensions in ukraine in particular, eastern ukraine, front page of "the new york times" says that russia has a very serious economic issues in particular. there are lots of costs associated, including infrastructure and crimea's on economic problems that are only compounded throughout russia. guest: well, crimea, ukraine, and what really is russian aggression towards ukraine is an interesting and important test of one of the basic propositions of the book, which is that in the 21st century, global economics is much more important than ever, especially for global politics and security. the russian economy is vulnerable to actions by other countries such as the united states and the countries of western europe. should we -- that is, the --ntries of the west

mobilize and impose sanctions on russia, that would make it difficult for mr. putin to continue his policies towards ukraine. whether we will have political will to do that, we don't know. but we now live in a world where we have economic tools to deal with the kinds of policies that putin is carrying out, which were really not available in the past, and the reason is the enormous importance of the global economy, even to a country such as russia. host: you spent a fair amount of time discussing the 20th century. seven years since the end of world war ii and 25 years since the end of the cold war. "people and a way, is then great lesson of the second half of the 20th century, and that was learned most profoundly in western europe. the countries of western europe fought each other in terrible and bloody ways in the first

half of the century, and the second half of the century, they began cooperating, now through the auspices of the european union. and they are doing much better now, not every country in the world, unfortunately, is as peaceful and commercially minded as the countries of western europe are. the westernt in european category, and unfortunately, neither is china. but both russia and china are affected by the example of western europe and by the rising importance of economics and especially global economics. that is a hopeful sign for the future, because it does make likely.r far less it does not abolish war completely. nothing is going to do that. but because the global economy, the subject of this book, is so important, war has become comparatively less important. host: with one big question and 2 so-called rogue nations, north korea and iran, you say this.

host: north korea and iran. guest: those are the 2 most aggressive countries in the world, the 2 most dangerous countries because they are seeking nuclear weapons, and if they get them, they could make a lot of mischief and do a lot of damage. north korea is an economic basket case kept alive by chinese shipments of fuel and food, and really isn't that all responsive to economic sanctions. but iran has responded to economic sanctions. the islamic republic, the clerical dictatorship in iran, relies on the sale of its oil to keep itself in power. the west has managed to reduce to some extent the sale of oil and rick nash i put pressure on the iranian government and ring it to the -- and put pressure on

the iranian government and bring it to the bargaining table could whether that will work, we don't know, but it doesn't show what is the premise of this book, and that is the power, the political power, not just economic power, of the global economy. host: i want you to respond to comments made earlier by hank paulson. but you say week thelier this former treasury secretary hank paulson, speaking here in washington, discussed china's economic earth, now at about 7.4%. here is his assessment. [video clip] >> the big picture is this -- this is a country that has a compass an extraordinary amount over the last 30 years, and they have done it with an economic

model that has run out of steam, in my judgment. it just plain isn't sustainable and so you can get a bunch of economists and sit around a room and talk about they got a do this and that, and when you talk about what they need to do it in terms of reforming the labor market, removing immigration , all of the various social reforms, government reforms, economic reforms, in unleash the potential of the private sector, to rein in the state owned enterprises, to reform the financial system, a $9 trillion economy to change the model is a difficult place to do. news iso me, the good

the leaders understand it. it is not like talking to u.s. politicians, who sometimes act like the problem doesn't exist. when you talk to them they are very pragmatic. host: the comments of former treasury secretary henry paulson. he served in the bush administration. his comments at csis on tuesday and the entire event is available on cspan.org. michael mandelbaum, your reaction? guest: i agree with secretary paulson. china does need to change its economic model to sustain high growth. but -- this is an important theme of my discussion of china in the book -- in order to change its economic model, it is going to have to make political changes, important political changes, and changes that, if they are made, will make china maybe not a full-fledged western democraticbut more . it is in china's economic

interest to become more democratic politically. host: but there was a report released ash available on the -- available on the cnbc website -- that china will surpass the united states as the number one global economy. has four timesa as many people as the united states so china could happen economy bigger than that of the united states but still have people with about one quarter of the per capita income of china. and the lyrical pressure in china -- political pressure in china is all in the direction of boosting per capita income of the chinese people, making them better off. i think that is going to drive the chinese leaders against their will probably to implement for democratizing reforms the sake of sustained economic growth. host: our guest is the author of more than a dozen books.

>> >> on the next washington journal, we will focus on unmanned drones. we will also take you live to virginia tech, one of six our guests include john green, interim executive director of the mid-atlantic aviation partnership, and craig woolsey, president of the virginia center of autonomous systems. "washington journal" is live on c-span everyday at 7:00 a.m. eastern. join the conversation on facebook and twitter. moments, a manhattan institute discussion on the future of conservatism and the republican party. a half, a report from supreme court justices antonin scalia and ruth bader ginsburg.

makea look at how to congress less partisan and more efficient. >> one of the real signatures of this room is how quickly this moved. there is some good about that, but there is also some bad. we were 10 years into this boom before regulators and the companies themselves started really asking tough questions. what is really going on with air missions? what is the cumulative impact? is it healthy? where is all this water were using going? as some of this wastewater causing earthquakes yucca -- are spills these wastewater causing earthquakes? there are answers out there. there are solutions. there are ways to do it right. >> russell gold on the good news and bad of fracking. he is one of the authors you can

watch when book tv stops at the san antonio book festival. coverage starts saturday at 1:00 p.m. eastern. on our book club, april's bing west reads the wrong war. now, a discussion on the future of conservatism and the republican party. include authors, columnists and journalists. from the manhattan institute in new york city, this is an hour and a half.

clicks what is the future of conservatism? there are a great number of people qualified to discuss these questions. we have assembled a number of younger leading-edge journalists, scholars and authors who come from a variety of backgrounds to discuss what the way forward could be. will not always agree, but perhaps through a thoughtful discussion we will illuminate the finer points of the debate. in a way, it reminds me of the early days of city journal, when people like kevin mcdonald and peoplekelling, hardly who would be characterized as classic conservatives, manage to

get together and form a conservative policy that was both coherent and successful. i feel like in many ways we are at the same kind of point in history. in any event, we are glad to .ring together this group their resumes are very long. they're very accomplished for their age. i won't go through all of their resumes, but i am happy to welcome our panelist. oh, good. better late than never. finally, we are very grateful to our moderator this evening, david brooks, columnist for the new york times whose very successful career has always been directed toward what is new and interesting in the world of ideas.

you all for being here this evening and thanks to those of you watching over the internet. please join me in welcoming the moderator of this evening's discussion, david brooks. [applause] >> thank you, larry. i was thrilled when larry called to ask if i would take part in the panel. then it became clear that i was actually too old to be a panelist. i used to be one of these people. now i am no longer on the leading-edge. i am just a dying ember. to be joined by my first research assistant. judging from the days when he and i work together, he is just waking up. it's good that he rolled out of bed in time for this. start.ing to here are a couple of quick questions. weefully not too many and

can cut each other off. begin with what is the problem and conservatism. i am going to mangle conservatism and the republican party together. >> i was going to say we don't how to make an entrance until he proved me wrong. conservatisms that and the republican party are not connecting to the issues of the day. a lot of people are finishing sentences that other people started in the early 1980's, and they forgot other sentences started and why. while i think a lot of the problems we face are actually very amenable to conservative ways of thinking and conservative solutions, the republican party is not doing the work of connecting their to today's problems, and voters know it. agree, and ifou so, what are today's problems?

>> there is a big problem with the coalition a came up in the 1960's and 1970's and flowered in the 1980's. sadly, there are problems that existed in 1979, and we solved them. republicans forgot to declare victory and go home. time, tax, tax, tax, was the only thing we could agree on, even though we had cut taxes and deregulated a lot. that is not speaking to where the american public, especially after the financial crisis, one to hear her solutions for the generation and the problems they have like feelingm unemployment, like mobility and opportunity are contracting. they want the republican party to speak to that and talk about how there is no longer advancement. >> are those the issues?

there is an antecedent problem. the antecedent problem is a lack of diversity in the people who vote republican and represent the base of the republican movement, not just in terms of ethnicity and race, but also in terms of regionalism. party, not aern northern party. i think the democratic party today has a much more legitimate claim of being a national party than the republican party does, and that is one of the reasons the democratic party does a better job speaking to those issues today. there is a sentiment that it is a white party looking for an america that is never coming back. >> there is that sense among some people. you hear "this is not the america i grew up in" as a proxy rhetorical statement.

long prideds have themselves in thinking well, we treat everyone as an individual. it's the other party that treats people as coalitions of race and aetna city. nice and ethnicity. i don't think that's true anymore. i think it has become a little we have to step outside of that and realize that some of these people, we don't treat them as individuals. we say those are democratic voters and we don't need to reach out to them. problem, thetopic mobility, and a demographic problem. >> i think the identity problem is the real thing, but i think if you have the right policies, that becomes easier to fix. managed to consolidate

the black vote because they made the correct appeals on policy. the problem is not just the republicans are going after problems that were fixed. set of problems has arisen the conservatism does not have ideas to address. there are two main ones. one of the key propositions of economic conservatism has been wery first about growth and shouldn't worry too much about distribution, but when you have returns occurring disproportionately, that no longer appeals to the middle and lower classes. and then we just went through this severe recession. conservatives have been making the same economic policy prescriptions in 2010 and 2012 .hat they were making in 2007 what that says is that there is

nothing the government can or may be nothing the government should do about recessions. one is wrong and the other does not appeal to people who are in pain. one of the propositions that conservatism puts out is if you don't want to give into the temptation to do too many transfer programs because while they create a safety net and reduce risk they also slow trade-offrowth, that of more security for less growth prettyually look appealing, especially if the growth we do get is accruing disproportionately at the top. aboutan conservatives say this economy echo it is a difficult question but one that needs to be addressed. growth producing risk and decoupling from wages.

>> i think our mental model of capitalism right now is wrong and because it is wrong we gravitate to the wrong solution. when we think about globalization, for example, we tend to think of a model in which we see dobbs flocked from the united states to china. -- jobs flockies from the united states to china. the division of labor is global in scale, but you still have hierarchies. you have the more privileged parts were value is captured, and you have less privileged parts. the change that happened after manyate 1980's is that countries became integrated and specialized in the division of labor. the most privileged and best places to be in that division of labor are still the united states in places like it, but the people at the top of those hierarchies are not all americans. it's not the entire country. manufacturetions 40% of what is made in the world, but the value is not

flowing to the population. capitalism is working extraordinarily well. globalization has been miraculous in terms of raising living standards around the world. the question is where are you situated in those hierarchies. the problem in america right now is that a chunk of the population exactly where you want to be in terms of the way the new capitalism works and the other chunk is not in a very good place. they are in and in between place where other people can do some of this work better than they can. that is a core challenge. conservatives have the right instinct about it but there has not been enough rigorous thinking about how to address that problem.

>> does anybody disagree with this basic notion that capitalism is somehow not functioning in the way the 1980's model assumed it would? >> i think in some ways that mrs. gripes the model. is-ascribes the model. the idea of what america is is shaped by a postwar america that could not exist again and is never going to exist again anywhere else in the world. the country that won a war and strengthened its economy while all of its competitors burned each other to the ground and so for a decade could contain within itself the growth of capitalism. way,ugh all did rise in a to some extent, that model defines our expectations in a way that is going to be very difficult to change. i had the experience last year charles murray's

new book right after reading paul krugman's. they start in the same way, pure nostalgia for the 1960's, and almost in the same terms. and they are right. those are years we should miss. lote are -- there is a about them to miss. but our policy has been geared around how to bring them back as opposed to how do we deal with today. both parties are intellectually exhausted at the same time in a way that is very bad for the country. was big.vernment big labor was big and there was a lot of economic dynamism at the same time. that's true, but it doesn't mean we could do it today. >> so what is the future? the 60's were pretty good to me. i know you guys don't remember it. >> we weren't born then.

>> that's why i enjoyed them. [laughter] >> one way to think about that is that an important difference between the two parties now is that democrats tend to think about the future in terms of large institutions. republicans, when they think about it at all, which is not enough, tend to think about it in more decentralized terms. in that sense, i think republicans might better be to have a vision of the future than the democrats. a huge rewrite of options in a decentralized space. that is what the future -- variety of options in a decentralized space. that is what the future looks like. >> i would amplify that even further by saying that the information economy is a fundamentally different type of economy than the industrial economy.

i think the political class in general, having been raised not just on 1950's nostalgia but on the industrial idea, is not as quick to think about how the country is fundamentally different, and that leads to a different set of policy problems, for example, what you do with unskilled male workers who are left behind. it goes beyond that. it is about a pace of innovation and a type of innovation and the labor force that is very different from what the political class -- political people and people who are intellectual tend to be old-school in the way they live their lives. they write. they read. that is not necessarily with the average person is doing today. i think people in that economy are much more attuned to that than the people who comment on it. i would like to push back on that a little bit because i think the 1950's and 1960's were phenomenally innovative.

there was phenomenal all construction and deconstruction going on. less innovative now than we were in many ways during the postwar. i think we are going to be even less innovative in the future because of the aging of the world. older people -- as i look at moreing 1 -- tend to be conservative temperamentally. but there is also this thing that if you're 57 and i come to you and say i want you to give me half your savings. i have a great opportunity. in 30 years you can be a billionaire. what, you're going to have the best nursing home in america? the calculus of risk taking radically changes in middle-age. we are doing well compared to the rest of the developed world. that is a huge challenge that no party is speaking to at this

point. >> you all made the point that a core distinction between left and right in the future is centralization versus decentralization. i want to get back to that point in a minute. let's go to megan's point, which book called the great stagnation from a couple of years ago which argues that we are winding down productivity or at least we are in a time of slow technological innovation and rose. that ties into the idea that america is on a downward slope. do you buy into that? >> i am not sure there is much policy can do about that. i tend to think that the likely long-run pace of gdp growth is acceptable to the extent that it is distributed in a way that people feel they are getting standard of living growth. part of the reason i wonder about how much policy can do is because i think we have been in an environment for the last

decade where we have had a de facto weakening of a lot of intellectual property protections such as copyright and patents. >> there has been a weakening. wakes de facto -- >> effective. there is rampant piracy and music. hasar as i can tell music not gotten any worse. the revenue model of television and movies has been disrupted but the quality seems to be improving. this is bad for producers but good for consumers. what it makes me wonder is for the quantity of innovation we get is the ip policy matter that much. of the ability of policymakers to influence it, so it's not where i would direct my energies. >> i have great respect for tyler but i completely disagree with his thesis about the idea

that the low hanging fruit of innovation has declined. if you look at molecular biology and genetics, we are barely in the first inning if even in the first pitch of what will be an incredible revolution of our knowledge of how the cells were, how the brain works, how the body works. thing we're missing when we are too optimistic about that side is the risk of the a catastrophic fiscal and financial crisis, which is what got me into this world out of the business world i was in before. we have more of a conception of what that could look like and we did in 2007, but we are so far removed from the depression that we really don't understand what a true catastrophic financial crisis could look like. >> didn't we just go through one? >> i was not as bad as the depression. >> think something conservatives have not fully processed is how

traumatic this has been for much of the country. >> i think it is nothing compared to what will come if we don't get our house in order fiscally. the past is not a predictor of the future. >> sure it is. >> ok, well. let's get to the core question of the future left-right divide of the country. on all have put something the table. centralization, decentralization. that strike everybody as true? >> i don't know. i think the core fight is the one we have been having politically about economic distribution and the role of the government as a redistribute or of poor andr middle-class interests. it is not a fight we are done having, but to put it bluntly, it bluntly, it's sort of the myre's my growth, where's piece of the economy. that's going to be the key question. >> you think wage amelioration

is going to be decentralized. >> i think the two are closely connected. there is a real logic to the left and the rights ways of thinking about the role of government in our economy and there is a real difference in where the left thinks in terms of managing large institutions. as a set ofety systems that are disordered and require better organization. it is a coherent argument. i don't agree with that but it's not a crazy argument. the right seems to feel that the role of government is not to manage the sides, but to create the space in which the sides can flourish. and that looks like chaos, and it is in many ways. that is how innovation happens. it's also how problem-solving happens. it happens in a local way, one-on-one, through local markets and institutions that bubble up, trial and error and pilot programs, not a centralized here's the technical answer. to ank we are hitting back

place where things are coherent and there is something like political economy on the table rather than just technical economics, where economics is subsumed by argument about priorities which in turn is subsumed in an argument about what american life is really all about. that is why i think conservatives could be better positioned than they now seem to be to address the public stories in a way that makes sense to voters. people have a sense that we are living in a society that is decentralized that offers them a huge range of options. younger people, in particular, like that and expect that and want that. you see that in the health-care debate. the sheer consolidation of large systems that is involved in the left way of thinking is not appealing to a lot of people. the right, i think, has not offered a coherent alternative. and you don't see people going around and saying we have a view

of the government creating a space and allowing people to function in that space. allowing competition to happen. rhetorically, conservatism isn't that. it is solutions to problems that the lateinent in 1980's. have two stories in terms of how i think about the future of the left-right divide. one is that the left is a party of democracy and the other is a diversity. in the first story, the idea is that when you are contacting a republic, they a are similar entities. their legal, institutional entities that own themselves and have their own cultures". -- own cultures and codes.

have one that succeeds and other corporations mimic that corporation until a newer more successful model emerges. the appeal of democracy to the left is we have true egalitarian function making and organization that leads to a different type of decision making. that's an attractive story to tell. the story you could tell going how we make different decisions. it's actually a good thing to have the trial and error process. ,ou cannot just say what works determine what works through a randomized controlled trial and then distribute that to all of society. the question is what works where. that i haveory become more and more concerned the leftthe idea that

is very concerned about the . butibution of resources there are growing populations that are marginalized from the pieces of our culture that are actually working very well. when you think about civil society, we tend to think about formal institutions. also think formal networks. when you think about friendships, for example. when you think about how upper middle-class people think about friendships as vehicles of mobility whereas working-class people tend not to be connected to the networks that give you access to upward mobility or opportunity. i actually think that when you think about inclusion and the goal of inclusion, it leads you to different policies. minimum wage.

if you care about inclusion, it's a big deal. it is locking out a swath of the population from mainstream institutions that allow people to accumulate resources, build social connections and break out of the isolation that is toxic. that suddenly becomes a very big deal. that's not to say that inequality is not a problem at all. it's to say that maybe we ought to think more about inclusion and then we have to look differently at a whole host of questions including immigration, integration, housing markets, zoning laws, but i really think that is the debate that i would want to see. >> let's try to get a concrete view. i will introduce two characters. john is 42 years old. he used to work at the mill. forow works at a warehouse nine dollars an hour. pretty much stagnant wages when he is employed. not going anywhere. sort of falling through the cracks.

2 e is a waitress making $27,000, two kids. offeringrepublicans these people? >> that's the question. the problem is this nebulous idea of the decentralized system of networks that we are not telling you what to do, we are trying to build the environment. increase inthis big perceived and actual economic risk over the last few years. what the left has is a suite of centralized programs to offer that are designed to mitigate and the pitch we are proposing to offer from the right is basically we will have pilot programs and state governments will take approaches of their own and figured things out. we will have civil society and such. that creates a lot of risk which is compounded by the fact that when you look at actual republican politicians, they have not expressed a lot of

interest in doing policy innovations. ,n these core economic issues although i think they have been innovative on issues that are not escorted the debate today. one problem is a credibility issue. also, it is not responsive to this broad new problem of risk. i think the way conservatives can adjust to that to some extent is to move away from fiscal policy emphasis. there are areas. there is still deregulatory opportunities at the local level, occupational licensing, planning and zoning. there are opportunities at the federal level in intellectual property were you could unleash market forces, create faster growth, beat down rents so that you return -- improve returns to labor ella 10 of two returns to capital. but i don't -- relative to returns to capital. is a way tohere

talk about this that democrats also aren't, which is reciprocity. one way to view the world is to think about what happens economically either as a forger does where you have higher risk -- you know, you go out hunting, and maybe there is nothing there. maybe you are a bad hunter or maybe there is no animal there. or you can look at it as a farmer. you put it in the ground, you do the work, you should get the crop, right? how we judge economic policy often very much boils down to is this outcome fundamentally about risk or fundamentally about effort. the thing though. forager societies still have very tightly linked networks. is a position democrats are often in the place of advocating now, which is that the rich are

taking too much. we need to take it from them. what obligation do these people have? none. we have been cheated. i think what republicans can do is look at a policy emphasis and say, if you do the right things, it should be possible for you to get ahead. it should be possible for you to stay connected to the labor market. looking at policy through that lens, things like wage subsidies, trying to get long-term unemployed back to work through tax rebates or what have you, those are things that say you are doing the right stuff and therefore you have -- we have an obligation to you. the rightnot doing stuff, we don't. if you're not trying to work, we don't have an obligation to support you. party hasink either captured that space yet and that would be a good space for republicans to go. >> tell me how wage subsidies

would work. >> there is a problem right now which is that americans are not competitive with chinese workers or whatever. or they are not competitive at the level their parents worked at. so they are downwardly mobile because the work they do doesn't pay what it paid their dad. saying no,f them are why should i do this. this is demeaning but i have to go work for a pittance for the rest of my life and it's all downhill from here. whichy go on disability, is a terrible program in many ways, not for people who are truly disabled, but it is becoming like a backdoor trap unemployment insurance. and it was not meant to have that role. what you can say is we are going to make up that difference. we are going to make it easier for you to support a family at the basic level your dad did it, at least, on the same kind of .ork and maybe you are 55 years old

and you're not going to go back e anollege and becom electrical engineer. that ship has sailed. but we are going to make it possible to maintain a minimum provided you are doing 40 hours a week, 50 hours a week. >> we being the federal government. andts tax rebates subsidies. there are ways to structure this so that it works. right now, you can work for a very small percentage of the year and get quite large subsidies for that. to raise a couple of points related to your original question. increasingly wealthy society can have more expensive .ocieties a starbucks paris stood does better than her counterpart did 50 years ago. the millworker though, that job

is gone and not coming back. i don't think either party has a particularly good solution. there is one thing we have ignored. we have talked a lot about income inequality, but we don't talk about the importance of cost of living well it if -- living relative to income inequality. if you live in a low-cost part of the country and your wages are low, you're not that bad off. it's trying to live on that wage in new york city that stuff. has to do with the fact that both at the local level in the federal level we have done a lot to drive up housing, food, basic goods and services that a low income person will have. so a message that is very free-market oriented that will help that person is to say we are going to drive the cost of your health insurance down. we are going to drive the cost of your housing, your mortgage, your rent down. those things make it easier to live your life. does everyone here agree it

is a decent idea or? >> i think it's a decent idea with the caveat that there are still a large number of people looking for work relative to the number of people hiring. wage subsidy is only going to further imbalance that by drawing more people into the labor market. it doesn't mean it's a bad idea, it just means it's ever more important to have policies to promote full employment so that translates into higher incomes rather than just paywing firms to play -- to lower wages. >> i actually fundamentally disagree with that. market looks great. leave it alone. it's fine. it's recovering. it's back where you want it. it's of this labor market. one thing you could try doing is making that labour market cheaper. the payroll rebate

tax one month for every month someone has been out of work. tois obviously not going take every long-term unemployed person and fix the problem, but there are ways we can redirect this and say look, we know you want to work. trying.you have been we are going to try to make it more attractive for employers to hire you rather than another guy. i think it's basically -- >> go ahead. long-run trend that has actually been getting worse in the last few years of rose relative to gdp growth and productivity growth. that is due to health care cost and not all of it. to a cultural problem that conservatives talk about that there is a declining

work ethic are less pride the people taken work. i think part of that has to do with the fact that you have this wages.growth in >> i think you are agreeing on that. >> i agree totally on the particular point. it points to the larger economic debate that has been emerging in the last two years, especially in the last few months. i think there is a lot of room for conservatives to highlight the ways in which there ways of thinking about helping the poor and middle class are centered around work. it has to be centered around work. some people have been doing this. senator rubio has an idea out there now that would distinguish in a sharp way between benefits they go to people who have a job and benefits that go to people who don't have a job. he is not ending benefits for people who are not working, but benefits for them would be in kind, housing, food, medical

coverage, whereas all benefits to people who are employed would be cash benefits. work would always be more attractive than nonwork. >> using the same amount of money, even using the same money, cash benefit is more appealing than a kind benefit the tells you what to do with it. andake work more appealing to make work the center of what we think it takes to rise in america. i think that is extremely important. nowdebates we are seeing are political economy debates. they are about priorities more than they are about technical questions about how to get the economy growing at this rate or that rate. and that is healthy. that is what our politics should be about and what our economic debate should be about. neither side has worked out there argument very well, be at is shaping up to

genuine difference. it shows itself in the health care debate, the labor debate, the debate on welfare, and it is a big part of our politics going forward. >> you have worked as a hill staffer and a white house staffer. you spent a lot of time with members of congress. how big a gap is it between this conversation and the kind of conversation elected officials are having? >> how big have you got? i think there are a few members of congress who are in this kind of conversation, and i think it is probably unreasonable to expect there will ever be more than a few of them. the question is how influential they can be, and at this point, i don't think they are influential enough. i think paul ryan thinks about some of these questions. i think dave camp thinks about some of these questions, and their committee chairman. mike lee is taunting in ways that are very interesting and constructive about these kind of issues.

he is not in the leadership. he is at the back of the list of the minority party at the senate. there is a lot of room to go. the debate that is happening about that, about what the , in my mind, be there is still a debate about whether there should be an agenda, not whether -- not what the agenda should be. they are fighting in a vacuum and the vacuum is important because of the inertia and because of a lot of arguments that don't make sense to me but to people sense during political seasons. logic of they the romney campaign and i don't think it worked very well. and i never think it could've very well.

>> a lot of this is about to be shaped by primary season for -- primary season. what are the debates that seem obvious that we are about to have? >> just to build on that question and also what you have all just said, this is why i think the demography of the antecedent policy -- this is the reason the policy makers and the republican party can't get anywhere and don't have any influence is because the people who vote republican aren't especially interested in that aspect of the republican policy agenda. the key thing i think about when i think about who would be a favorite in 2016 is who can expand who votes republican the most, because that is what presidents do. josh mentioned civil rights and the democrats.

a lot of democrats were opposed to it. what happened? the iron will and incredible rammed of lbj who through civil rights despite the opposition of democrats, and in time, that got democrats the allegiance of black voters. perhaps republicans need to do something similar with the conservative message that appeals to a broader slice. >> are you saying they won't hear policy proposals like the ones we have just been hearing? >> i don't know if i would put immigration reform at the cost of the list. i would put universal coverage at the top of the list. until conservatives can articulate their side they don't deserve to have a broader base of support. the pointe are now at where it should be more a matter of us being outraged that

candidates don't have a serious health reform agenda, labor market agenda. those are two particularly crucial pieces. but if you don't have something to say about wage stagnation and what is an actual, viable alternative to obamacare, then i think you shouldn't be taken seriously. the last time around, that was not the case. you're the couple of candidates who had exotic tax reform proposals that were exotic, by which i mean laughable. this time around, i think we have enough of an emperor structure. we have enough of a body of ideas where i think it is at a bare minimum the candidates should have some kind of serious agenda around health form, labor market and taxes. i have foundthat certain developments in the

republican presidential field moderately dispiriting. maybe there were some people i was excited about in the recent less the caseis la now, but that is actually intellectually useful. >> don't be coy. aboutshould not be character or personality. we should have a situation where everyone who wants to be taken seriously as a presidential candidate understands that they need to have a serious agenda. they need to actually engage in these arguments. something weird happens. there are easy ways to become a conservative celebrity, by saying outrageous things, etc.. but some people are realizing that saying new things about real problems that exist is not necessarily the number one way to get attention but it actually is becoming a way to get attention, and i think that's really new and very exciting. be in the early

part of every presidential season, candidates would give a series of worthy speeches. george bush came here in 1999 and gave a speech attacking grover norquist, which i loved. he gave that kind of speech. cycles, theyle of have not been giving those speeches. my impression is the only person doing that is marco rubio right now. >> of the imaginable candidates, that is probably true. of it is there are more ideas out there. in a sense, the policy vacuum on the right itself has been the fault for a long time of people like us. i think that is less true now because some of the work has been done. some of the thinking has been done, and the working out of what it looks like as a political agenda has been done. the idea that if those things , ast, they are on the ground

politician should think at this point of speech i should say something about what i am going to do. we cannot think of ourselves as being on the cutting-edge of anything. i mean, look at us. but that is a way we can be useful. well, some of us. look at me. i think the ways in which people who think about policy can be helpful is by preparing the ground, making sure those ideas are out there and that these conversations are happening. there are not separate from the political process. when it is time for a politician to think how do i speak to the party in the country about the issues people face, there are actual ideas out there rather than thinking the only way i can do it is to get this amount of face time on fox and that means i have to say this, that than the other, 9-9-9. >> it seemed for a little while that there was a rising libertarian wave.

rand paul certainly exemplifies that. is that still true? >> i think there is on some issues. iy marriage is an issue that think the republicans have lost on and i think that is going to be the future of the party. that is going to collapse on both sides. you see a lot less enthusiasm for invading middle eastern countries and so forth then we had in 2003. in that sense, i think it is true. it's just kind of hard to say, in 2012, and the election was interesting because both candidates seemed interested in saying as little as possible about what they would do. can anyone name a policy agenda either obama or romney had other -- other than appealing obamacare?

>> i wish mitt romney had noticed. general, there was a reason for that. we are out of money. when you poll people, they want to cut the huge foreign aid budget and raise taxes but only on people who make $2 billion a year. they want all the social spending we are doing and everything else and they also want a balanced budget. you can point out things that are mathematically impossible. butnt to balance the budget only raise taxes on four people and don't cut any foreign aid. be 2016ear is that will as well. what i hope is that that will be the way to win. obama won by not adding anything. romney could've won by not saying anything. to talkpe we are going about these problems because they are huge and they need to be addressed.

it's no longer possible to sit on the sidelines. to have atried not tax plan, and then and i think february of 2012 he felt like he was backed into a corner by rick santorum, and then like everybody else he felt like he needed a tax plan, and it came back to bite him in the fall because the numbers added up to you either had to raise taxes on the middle class or it had to be a net revenue loss. i think the lesson people take away from that is that mitt romney got too specific on policy and would have done well to be even vaguer. they thought through whether they should have a policy agenda and concluded that they should not have one. it left us with a headache. they thought it through. it was not that they had no idea how it would work. they thought the politics of that would be a bad idea.

that has to change. the politics of that has to change. >> one thing we have not really talk about this evening is that fragile conservatism is intellectually and also in terms of what appeals to a broad section of america. there are a lot of reasons for that. we always talk about economic policy. we like to want out. wonk out. but young people today grew up well after the 1960's. they put last night's date on instagram or snap chat. ist is a large part of what going on in america that we as conservatives have still not moved past the battles of the 1960's. are we comfortable with the fact that the vast majority of americans engage in premarital sex? i don't say that to be ironic. i think that is something

conservatives really have wrestled with and don't have a good solution to. i think we will end up a pro-life party that will accept liberal hegemony on other social issues. a marriage is an issue where republicans will lose, but if you look at marriage as a whole, it is in -- disastrousape shape, and that will hurt the economy. marriageonal level, makes people happier and healthier. it's actually good for people. if you have serial parenting where people have multiple children by different parents, the father tends to invest in the mother with whom he gets along the best, that is not a stable model for the 21st century. i actually think there is a way in which the gay marriage issue could be used to make a more robust plan.

ok, we have marriage equality, now everyone get married. >> you can make that policy. i think actually having people voice cultural policy also matters, right? i mean, look how influential .ollywood was on gay marriage the positions tv shows took on a, how much that changed public opinion. >> that we should take over hollywood. >> let me try to answer that question if i can jump out of my moderator role. like most of us here, i looked at pro-marriage policies and my conclusion was that none of them worked. my second solution is that parenting skill coaching actually does work. so don't focus on marriage, ,ocus on parenting skills particularly for single moms. some of that includes nurse

family partnership's that government could fund and other things. wouldatter of curiosity, people on this panel support those sorts of allah sees government-funded, maybe if not government delivered, like nurse-family partnerships or early childhood education? >> i think when you're looking at parenting skills -- basically, what you see is that everyone is delaying marriage swath ofty, and one the society is delaying children until after marriage and another swath is not. with regard to that kind of investment, i think -- i call myself conservative despite the fact that i am influenced by a lot of libertarian thinking. ofs goes back to the issue inclusion more broadly. when you are looking at how parenting has evolved, when you look at upper middle income

people, college-educated people, they are parenting not in the way that people parented in the 1950's and 1960's. they are parenting in a new way, a high investment style that happens to be very well suited to a society with rapid change. is high investment parenting something only this narrow group of people can do or isn't something a large swath of the population can do? if you need public policy, as i suspect you do, i think that is something we need to think hard about and feel that it is appropriate for conservatives to embrace, but i think that is going to enter deuce and introduced -- introduce an ew tension. nud there is a lot of exhaustion and faith in failed public institutions, but i think you're saying a whole series of issues, for example, marijuana

regulation, where you're seeing the conflict between chaos and order. even subsidies. some libertarians say the labor market is not inclusive enough. minimum wage might not be the way to do it but wage subsidies might make it more inclusive. i think conservatives need to feel more comfortable acknowledging that they are not libertarians and i think investing in parenting is one part of that puzzle. >> i want to hit on the theme of paternalism. paternalistic.is schools are paternalistic. nurse-family partnerships are paternalistic. as conservatives, are we comfortable with a certain level of public paternalism? >> heart of what has happened in the last few years is a change of ourown understanding fairly recent history. you say welfare reform, which is what everybody talks about first when they talk about

conservative public policy. it was very put -- it was very paternalistic. it was also very decentralized. comfortables are with paternalism when it is relatively local and can be defined differently in different places. even if there is sentinel -- even if there is centralized funding behind it. there's certainly room for that to help people with family formation and with other concerns, but they are always going to work at the margins. it's true, there is some evidence that helping people with parenting skills works. it helps a little. it works better than marriage promotion, which does not really seem to do anything, but it only helps very little. if we talk about the ways in which capitalism does not seem to be working right now, capitalism requires a kind of notzen that it does produce. i think we are seeing now what

it looks like when we fail at least in some portions of society to produce that citizen. and you can't blame the people in these situations. you can't blame the larger society, at least not in the simple sense. this is the greatest of it all is the problem we have. am very much an optimist about america but on the matter of how to help people in those situations, i don't think anyone has any idea. capitalism requires a kind of citizen it does not produce. very well put. libertarians are pretty comfortable with paternalism aimed at children. treat kids like kids. i'm good with that. i will also say that there is public policy and wages -- when you talk to people who study marriage, a lot of them talk about the fact that the wage situation is such right now that men cannot get steady work for 50 weeks out of the year

that pays anything and therefore they are not any use around the house. does marriage promotion work? no, but there are broader public policies where you can try to do things that make it easier to form an intact family. things like early childhood education, i don't know if you can actually scale it. i think harry preschools do a good job. i am not convinced you can reproduce perry preschools for 4 million kids a year. a partnership, even if it does a little, is better than nothing for kids who have very little. >> i think it's right that you want to try these things on a decentralized basis. things that involve complex delivery are better off being done by local governments. that i think doing this with a decentralized model depends on having a centralized fiscal

policy layer on top of it. it's one thing to say we're going to do parenting classes and various other things to try to improve outcomes for kids and families. it's another to say we are to do this and then we can cut the food stamp program. i also just because of the separate approaches with their own merits that can be done together, it's really important to pair those two things. >> thank you. if you don't mind, i'd like to brick bring -- i'd like to bring the discussion from 30,000 feet down to ground level. you have mentioned that it is important to create the citizen for the appropriate scales for the new age. i would put to you that any candidate, democrat or epublican, who can address the

problem of having the right worker, the right employee, would get everyone's vote. let me give you an example. the president of the national association of manufacturers said that at any one time there are two million manufacturing jobs openings that are going unfilled because of a skills gap. why is that? certainly throwing more money at the education system is not going to close that. so we need a set of policies that closes that skills gap and cements the workers' stake in the system by giving him and her those skills that are marketable nd are sought after. right now manufacturing is 12% of the company. if it can be raised to 15% of

the economy, we would have the same level of employment in the manufacturing sector as we had in 1980. now, will we go back to 1946, hell no, that will never happen. but there are -- so the question is, who can help create the kind of policies that will create a closure of the skills gap, to create the employee that is ought after by the new cap tal -- capitalist economy? >> there are a couple of questions in that. and all of them are framed from the point of view of an employer in a way that's interesting. that's useful but i think is also probably too often the way conservatives think about questions like this. i would say it's certainly true that our education system -- the education system of any public that takes it seriously is always going to face the challenge of balancing it self

-- its self-understanding. is your role to create a citizen that is capable of self-government or the worker your economy needs? the answer is both but the way to balance those, the way to distinguish between what is universal education and what is specialized education for what's needed here and now is a challenge for our education system. we at this point are probably not doing either of those things very well and our education system is not great. for many people it's fine. for some people it's absolutely dreadful. from the point of view of employers, it seems to have all the wrong priorities. i think that requires some changes in the way we think about the distinction between higher ed and secondary education. the distinction between worker training and education. those things have got to be -- have got to answer needs that bubble up from the bottom. as you're suggesting. so they've got to be a little more flexible, they've got to be capable of offering people more options, i think there's a lot of room for improvements in the

way that our public education system works and the education in general works. i think it's a low-ranging fruit for public policy. there are a lot of low hanging fruits for public policy. there are a lot of places where the inefficiency of the systems that we have is so great and their inability to deal with problems that are perfectly obvious is so great that you can really improve things quite a bit in a lot of areas. education certainly is one of them. i think thinking about it in terms of worker training is one obvious way to do it. we do have to be careful it's not the only way to do it, because it's not the only problem with our education system. >> i want to jump on this just briefly. my personal view is that the real problem is that you have corporations that have very high profits right now, you have corporations sitting on enormous reserves of cash and why is that? that's because they're not afraid. i think when you look at economic secters in which firms are afraid that their advantage is going to evaporate, that some new startup is going to come and destroy them, those are the firms that are hiring. facebook started out as a

relatively small company. they're hiring quite a lot. they're never going to become as big as g.m. but they're hiring a lot. they're paying higher and higher wages to the people who have skills and that in itself is creating a dynamic in which people are seeking to build those skills. when you look at the corporate tax code, the way it rewards large incumbents, if you look at all kinds of aspects that we treat business enterprises, we are not creating an environment in which these firms are afraid. it's perfect to have a safety net for citizens. it's not appropriate to have a safety net for corporations. i think an environment in which more corporations are afraid of business model innovation, i think that would actually be very good and would be particularly good for workers. >> i lsm never disagree with reihan but i have to here. corporations are sitting on cash because of political and economic uncertainty. they're concerned about higher taxes, regulations can drive up the cost of their business, cost f capital. >> let's get some more questions

here. >> mike with the manhattan institute. we talked about cities, we talked about conservatives being -- needing a national movement. in order to be a national movement we need to compete in cities. that's how we move senate races and certainly eventually presidential races. and we have the examples. we have right here in new york, indianapolis, reforms on public labor and certainly most recently public safety. but we lose cities. so my question is why? is it messaging? do we need a new agenda? many of you would say that we are kind of solving the problems of a decade or two decades ago. but i think in cities we're solving today's problems but we're not getting better. what do we need to do? >> in 2008 when obama was elected, i actually looked at this problem and thought, ok, is this true in other advanced economies? where the cities always vote left and the rural areas always

vote right? and it turns out in europe there isn't a clear pattern. in some european countries the cities are actually more politically conservative than the rural areas and there are maybe a lot of different reasons for that. but that gives me hope that there isn't any inherent -- anything inherent about urban life that necessarily means people must vote more left than rural people. but i do think it's a huge problem and something we need to address and we have to be willing to compete in areas where there isn't a short-term payoff. that's the hardest thing about the political cycle. is the short-term payoff leads us to cultivate the voters that we can win in the near term and that leads people away from ities. >> thank you for being here today. this has been a very interesting panel discussion. i wanted to ask about education but you touched on that. i want to ask about foreign policy. it doesn't translate into a lot of votes but it's something that's obviously very important. the bush years could be

described briefly as perhaps overreach. and now you can say that a conservative critique of obama might be that we withdraw too much and it allows a vacuum for strong men like putin. what would be the conservative response, what would be your response, your policy prescriptions for what's going on in the world right now, particularly in ukraine and syria and how you guys would think about handling that? >> i doubt we can touch on all of those things. but this is an area where the panel is pretty divided. joe sonally believe that has this -- he said in the 1990's i think it was, securities like oxygen, you only notice when it's vanished. i personally think that u.s. global leadership, i think it's extremely important in undergirding much of the rice of global prosperity we've seen. i do think it's fair to say there was overreach during the

bush years but it's very important that we invest and i think the problem is that the investing in our capabilities, the benefits of that are not always clearly visible. i also think it's true that the problem is that there are big swaps at the national security state that are ok. it's hard to tell. it's hard to have a coherent cost-benefit analysis. there are real structural problems and we might want to shift resources. but do i think there's a dangerous tendency on the right to give short drift to the importance of american power undergirding global stability but this is not a popular view. least of all among younger conservatives. >> foreign policy is important but it's not going to be important in the political debates of the next decade or decade and a half. i think -- we've had very little recent time where we've sort of had a normal political environment on foreign policy because we had the cold war and then september 11. got for nk the best we where foreign policy is going to sit in american politics was the period from 1990 to 2001 where

it was not salient. you can see that in the way conservatives talk now about the obama foreign policies. they try to find points to sort of harp on where the president is seen as weak. i think that's behind the obsession with the benghazi attack. i think there was also a very telling statement from marco rubio about syria, when we were -- when the president was waffling about whether we were going to intervene this and rubio took up a position where he wasn't sure if he was for or against an attack in syria but he was against whatever the president was for. and so i think i don't know what kind of foreign policy a republican president will enact if elected. george w. bush ran things that he was going to have a humbler foreign policy and then september 11 happened and directions changed. i don't think that's going to be a key driver of elections.

>> hi. first, thank you, everyone and moderator, for hosting a really interesting discussion. i have a question about health care. 'm directing it toward josh. toward the end of the discussion you suggested the decentralization of service delivery as superior. there is a segment of the health care complex called home health agencies and they take patients in a recoup are ative and retabletative phase and bring them home and it suggests much higher outcome, much cheaper delivery. the affordable care act has almost destroyed the industry. it's led to major reimbursement cuts over a multiple last two, three, four years. do you see this vis-a-vis the left-right divide, given there's a superior outcome with it, as something conservatives can reintroduce, repackage, rebrand and sell in the health care

complex for superior outcomes? >> i think the interesting thing that we've seen or an interesting thing we've seen with the implementation of obamacare is i think to an extent it's been a driver of innovation among providers because they're faced with these reimbursement rate cuts. there's been a real drive in the industry to find ways to contain costs. we've seen i think a slowing in health care expenditure over the last couple of years. and so actually the government turning off those taps to an extent -- and remember, it's not like we had a private health care system before obamacare. we already had the government incurring about half the expenses. so by paying less i think that can be a driver of a kind of decentralized innovation. where the government basically is saying, we're going to pay less. you figure out how to do it with less money. that's not the same as -- that's not to say it's going to work everywhere. if you cut reimbursement rates too much you're just going end to up with scarcity of care. although i would note that among the somewhat disappointing

findings from the oregon health study, we found people were consuming substantially more health care if they had medicaid which suggests that barriers to access due to low reimbursement rates were not as large of a problem as people on the right sometimes say. you don't want the federal government going in and telling health care providers exactly how to do their jobs. but i do think that centralized fiscal policies can be a driver of decentralized outcomes about service delivery. >> it's very simple. give consumers control of their own health dollars. then all of these things, whether it's home health care, retainer-based primary care, a lot of this stuff will automatically happen. why? because if the consumer is controlling the dollars, then the industry works for who pays them. today it's the government and third parties that pay the deliverers of health care services so the person who is important in that system is the payer, not the patient. if the patient is controlling the dollars then the system

magically works to serve the patient. and that's actually -- i resist this call for conservative from a termism because i think the opposite is what we need. we need to actually restrict the doing the government's but actually give people the money. so if we're concerned people don't have the means to afford certain services or support themselves in a certain way, that doesn't mean have some complex government program that tells them what to do. give them the economic resources to pursue the people who would deliver those services directly. >> the point that josh finished with, which i very much agree with, in a certain way the home health care question is one that shows the problem of both sites. the system we had before obamacare and the system we have now. in the bush years there was huge pressure to increase investment in home -- in all forms of home-based health care. which was also a sort of centralized decision about how the system should work. it didn't work very well. it was probably an enormous waste of money. and now we're doing the reverse

and saying, well, let's have a centralized decision that says, no, we don't do that. neither of these is the right approach. the medicare system we have, and really the larger health care system we've had before, was not consumer-centered, market-oriented system. that's the direction that conservatives need to move in. >> some of this sounds very familiar to me. the pessimism i'm hearing was very similar to the pessimism of the late carter years and i was with the reagan administration. it was amazing how quickly things turned around. and i think some of the 1980's solutions are still there. i think problems of regulation, obamacare has messed up the medical markets but it's also messed up the labor markets tremendously.

financial regulation, just today there was a report on a large number of new species being declared endangered. i think all these -- everywhere we look the economy -- [inaudible] and i think that's a lot of the unemployment we're seeing goes back to your mill worker. why does he have trouble finding a job in maybe because employers won't commit to hiring because they don't know what kind of health care expenses he's going to generate in the future. so i think to the extent, if we could deregulate some of these things, we might be able to move away from many of these problems. >> i agree, but it's also true that the policy challenges of today are very different than the challenges -- policy challenges of 1970. just look at the tax rates in 1978 remember us is the tax rates of today. regulation is a much, much bigger problem than it was then. so we have to have an agenda that is tailored to the challenges of today.

>> you guys talked about how there's no republican plan to deal with decentralization in civil society. but i'd argue that the ryan plan was conceptually about that. it was about privatization and voucherization which would decentralize from the federal government and a large amount of spending consults which would allow civil society to flourish. that program seemed very popular with republicans and very, very unpopular with the public. so i'm curious if you think these sound like good concept bus if in practice they're going to be too to volatile and unpopular? >> almost no voters care about decentralization as such. so you can't build the message around that. nobody goes into the voting booth and says, do i want a government and society that is more central or less central? they care about more fundamental pocketbook issues. but the ryan plan thing goes to a distinction that i mentioned

earlier. you want to decentralize certain kinds of deliveries because of the value of local knowledge, you have different preferences in different areas. bureaucrats who work for local governments are more likely to be in touch with local people or who work with nonprofits than people who work for the central government. but that doesn't mean you have to decentralize the actual fiscal flows where the federal government has a significant advantage in its ability to tax and borrow. if you commit to having those decentralized, it gives you more flexibility to centralize our -- other things. this is not just a backdoorway to slash the welfare state and reduce real incomes for people. >> there is a problem that republicans are going to have to deal with. you may have noticed obamacare wasn't popular, still isn't. most things that are actually fiscally feasible are wildly unpopular. people like free stuff that is paid for by some other person

they've never met. it has never been more true than it is today because we have an aging population that is very conservative about keeping what it has gotten and because there's less money. with lower growth you face much harder fiscal tradeoffs. you can't take it out of surplus. you have to take it out of something that people already have. i think this is going to be a big challenge for republicans as they frame an agenda which is that if you're going to be honest about what it's going to cost and how you're going to do this and who the losers are going to be, because there is no such thing as a policy in which someone is not worse off, then you're going to have to go out and say that. and be credible. that is going to make those people very upset. > democrats can do that. >> i think the problem is that it takes us 40 minutes and a

future of conservative -- conservatism talk to mention nything about social issues. we lose people flat-out because we have this bloodletting of state by state gay marriage, yes or no. so is there some kind of way that we can avoid a possible skis much of northeast republicans who frankly this issue is settle, right? all of us have gay friends, we're fine with it. but for southern republicans, how do we keep them from going off and causing a schism and running away with todd akin and pat robinson? >> i think even in the south, young republicans have your views on the social issues. so i think this is a generational transition that's going on on both the right and the left that perhaps won't be as substantial of a schismatic

issue in the future. but i think that's sort of the political element of it. i actually wish and hope that conservatives would have a coherent political philosophy around what they think culture and society should look like that would accept the post-1960's reality, the world we live in. >> a couple questions from social media. but i'm going to jump in. the republican party is a pro-life party. it never will not be a pro-life party it. would die without being a pro-life party. i just have to say that. i'm not a pro-life person. i'm just pointing out the reality. >> there's no generational shift on abortion. >> i carve out abortion from the other social issues. >> this is a question from one of our twitter followers who is watching. it comes and he'd like to know, why not define debt ceiling to e the ratio of debt to g.d.p.? >> the fundamental problem --

this is just a general thing. people believe if they could only come up with some great rule, they could stop people from doing stuff they don't like. we just have to -- first of all, you can never get the rule because the other side understands what you're doing. they're like, no, you can't have the rule. the second problem with this specific thing is that there's always going to be an outstanding emergency. we declare war on iceland once a year and then we give them a plan and we've gone right back. there's always ways to gimmick these budget rules. our job is to tell politicians no, don't borrow any more money, cut spending and by the way, i really -- this is something i think the republican party really needs to do is say, when you spend money, that is borrowing it, ok? the decision to spend is the decision ultimately to borrow and then the decision to tax. and george bush totally elighted the fact that when he spent money he was going to have to

pay for that through taxation and obama has not even been interested in that discussion. on both sides, we need to understand that they're all the same thing and that trying to focus on the debt ceiling is a way to control that is not focusing on the fundamental problem which is the stuff we bought. >> this is not the biggest problem with that. the biggest problem with that is that the economic crisis in this country is massive unemployment and the fact that wage growth is anemic because the labor market is slack. and conservatives have become a movement of people who think that that is a less important issue than government debt even though interest rates are extremely low and capital is flowing into u.s. treasuries because of the market is strongly accepting of the fact that the u.s. government will pay those debts. if we continue to prioritize this debt issue over issues that are actually of economic importance to 58% of americans, we won't -- 85% of americans, we won't be able to appeal with

them. >> i disagree with this on two levels. interest rates are low. t just politically, people hate the debt. this is polled incredibly well. everyone hates borrowing money. do they act on that, no. are they totally hypocritical and irrational about it, yes. but is this political problem for republicans? no, i think this is something that actually when they go out and talk about it, polled extremely well and does them good at the ballot box. >> it's a profound economic problem. the most profound economic problem. >> a conservative is somebody who thinks every market is efficient except the treasury bond market. [laughter] >> we want to have a debate about monetary policy and what they are, that's fine. but let me tell you. in 2040 when we're paying more in interest payments than we collect in tax revenue and china has twice the g.d.p. than we do, you'll be very concerned about the price of u.s. treasuries. >> we've got one minute left. and i'm just going to ask you one quick informational question. since you're all young hipsters.

[laughter] what's the most conservative macklemore song? no. i want you each to name either a politician or a writer who if you had to pick someone to have a profound impact on the future of conservatism/the republican party, pick a person presumably not yourself. [laughter] >> i'm willing to say i will probably be the least influential writer on the republican party like ever. all of my ideas are basically electoral death. but -- david brooks. very much. [laughter] >> credibility shot. >> one person who gives me hope at this point is mike lee. who is first of all a senator who doesn't think he's running for president which is just a wonderful thing in american life and very rare. but he's also a person who is shaping a conservative vision that makes a lot of sense to me and i think it would make a lot of sense