>> rose: welcome to our program, a look at the future of afghanistan with dexter filkins of the new yorker magazine. >> well, to me there always have been two fundamental con addictions in this war, at least in the last five years we mentioned one which is iraq, that took the resources and the intention away. but the fundamental con addictions of this war are for me, number one pakistan which you mentioned, those are sanctuaries right across the border, taliban can do whatever they want, the leadership is there and lick their wounds and plan attacks and all they can do is make it across the border and we have to stop, that has never changed. >> for 11 years that has never changed. sometimes the pakastanis help us, most of the time they don't. but the second thing is .. the state we have built, the government, it is, i mean as they call it, they use the term vice, vice, vertically

integrated criminal enterprise, that is a military term. >> rose: and then we conclude with a look at the 2012 presidential election and also what is happening to the middle class in a conversation with james carville and stan greenberg, both former advisors to president clinton. >> i think president obama has been much better of late, but understand that we come from this from a little different position. stan and i, this is the greatest problem the united states is facing is what do we do about the middle class? >> rose: america in afghanistan, and american politics when we continue.li rss provided by the following.

>> additional funding provided by these funders. >> and by bloomberg, a provider of multimedia and news and information services worldwide. >> from our studios in new york city, this is charlie rose.

>> rose: dexter filkins of the new yorker magazine is here, this week's issue called after america, he asks this question, will civil war hit afghanistan when the u.s. leaves? he reports on fears that an american presence is the only fact of keeping the fragile country out of the hands of the warlords and taliban. >> the 2014 exit many afghans are preparing for the conflict that may follow. >> i am pleased to have dexter filkins back at this table. so here it is. the cover of the new yorker magazine. after america, when the soviets left afghanistan erupted into civil war, now as u.s. prepares to withdraw in 2014, what can be done to prevent another catastrophe. >> tell me on the ground what is a catastrophe waiting to happen? >> well, there is a lot of fear, nothing is inevitable, of course and we can't predict what is going to happen. maybe everything will turn out hunky-dory, i think what afghans are worried about is after the

americans leave and we are leaving, we will be gone, combat troops will be gone by the end of 2014, as we leave the afghans state which we have largely built and the afghan army will not be able to hold the country together. >> rose: are you sure of that? >> no. this is a fear. this is what people are worried about. this is what they are talking about. all you have to do is go into a tea shop in kabul, that basically the taliban will come back in some way, either by force or they will be brought into the government in a deal, and particularly the groups in the north, in northern afghanistan, the minorities, who suffered the most under the taliban, they are terrified of this prospect, because they are terrified of all of these things happening again, which happened in the 1990s and as you mentioned in the 1990s after the soviet union left yo you had tes of thousands of people killed, gave rise to the tall began, al

qaeda and 9/11, nobody wants a repeat here, but that is the fear. >> rose: and what can be done to change the circumstances so that does not happen? >> well, that is hard. i mean, the fix is the afghan army, i mean, that is it. if it is good enough, then the state holds together, if it is not good enough, then it falls apart and that is, so it all comes down to that because, you know, what we have built there, it is not very pretty. it is not sort of a western style democracy, it is not. >> rose: it is not free of corruption? >> no. i mean, it is a giant criminal enterprise. but it is a state, it is a thing, the, you know, it holds the country together at the moment with our assistance so the question is can it stand on its own? can it fight the taliban on its own. >> rose: all right here is a conversation i did with general martin dempsey in march of this year about the afghan army. he is as you know chairman of the joint chiefs.

roll the tape. >> do you believe that they will be prepared to accept the responsibility by 2014? >> well, i will tell you what i do believe and this is from my most recent visit there. i think when given the opportunity to leave, there are some capability gaps, but when given the opportunity to do so, they actually do better than we think they will, and importantly, they perform better than i think they think they can, so, you know, we are plowing new ground really with afghanistan to try to build its sense of nationhood and trying to link together these disparate groups, and to have a sense of national identity. and so to answer your yes, i do think we can deliver the objectives, transition to afghan lead with us in support by 14. >> rose: so is that what the people that you talk to in afghanistan say?

>> or is this the view from washington? >> that's the washington view. and general dempsey a good guy and i hope he is right and maybe he is right, but what you hear and what i saw when i was on the ground is not quite that. at least not quite that in 2012 you know, we have got two years to kind of make it work. but for instance if you talk about -- i will give you one example, i was in a base, i went to an american base that they were literally bulldozing i mean we are leaving and we are leaving, they were bulldozing an american base and they built in its place a small afghan patrol base. i mean it wasn't tiny, it was 100 feet by 100 feet. they didn't have radios to talk to one another and couldn't call for help and they didn't have heavy machine guns and they didn't have water, they didn't have electricity, they just -- i mean the captain -- i mean the head of the unit, he didn't have a helmet. you know, and this is -- this is what it looks like,

you know, the plans are great and there are people working around the clock to make this work and maybe they will but when you get down on the ground in afghanistan and always has been the case when you get way out there in these remote areas, as general dempsey was describing, it doesn't always match the plan. things fall apart in that country because it is just so hard. >> rose: how is the taliban, how is the taliban perceived? >> depends on where you go. in the north, i mean, in the sort of civil war, the prospect of civil war i described is basically a north-south thing. >> rose: which it was before. >> which it was before. >> rose: here is secretary of defense robert games told me on may 16th 2012. >> do you believe the afghans will be able to take over and perform in a way to prevent a taliban takeover in 2014? >> i think a lot -- i think the answer to that question depends in part on how the next two and a half years plays out.

the afghan army has grown a lot faster than was originally planned, and i think despite the problems that we have had that everything i have heard, everything i saw in my many visits out there is pretty good. i mean nobody ever questioned the afghan's ability to fight. >> rose: so they are sticking to the point of your article here, what happens when they come out and they are basically saying we don't know, we don't really know. >> we are rolling the dice, you know, we are leaving, we are leaving anyway. >> rose: you said that. >> so it doesn't -- whether it works or not, you know, so -- >> rose: it is a question of whether it works or not we are out of there and it either works or doesn't work and we will see. >> exactly, yes. and you can see just by listening to secretary gates you see, there is no great certainty in his voice. and you can also see all of the objectives that, you know, nation building, that is out the window, counter ininsurgency, that is gone, we blew it. >> rose: how did we blow it? >> boy that is a big question.

>> rose: okay. >> that is a big question. i think for starters if you just take the really easy, the really easy part, the easy answer is, iraq. you know, if you look back in 2001, 2002, when that was the only war we had, we could focus on that place, but almost immediately after we toppled the taliban we started -- we turned our gays to iraq, we sent the troops there and sent the special force there is, the money went there, the intention went there, the planning, we took our eye off the ball and those are the really crucial years when the taliban went from being completely broken to regrouping and coming back. >> rose: suppose the pakastanis could have and did do their -- do the responsible thing to stop the borders and didn't try to play both sides by allowing the taliban to cross the border in waziristan, which they have never done, would the result today be different? would the taliban have been able

to then be contained? >> and i think it is really -- it is really interesting question, could it all have been different if we had done everything right? we didn't do everything right. we got a lot of things wrong. >> rose: what did we get wrong other than the thing we tried to do something about with which couldn't which is shut down the border with pakistan. >> there are have been two fundamental con diction mrs. this war in the last five years .. we mentioned one which is iraq, that took the resources and the attention away. but the fundamental contradict sthunls of this war are number one pakistan which you mentioned those are sanctuaries, they are right across the border, taliban can do whatever they want, the leadership is there and they can lick their wound and plan attacks and all they have to do is make it across the border and we have to stop, that has never changed for 11 years that has never changed. sometimes the pakastanis help us, most of the time they don't. but the second thing is, the state that we have built, the

government, it is -- i mean as they call it, they use the term vice, v-i-c, e, integrated criminal enterprise. >> that is what the nato called the government in kabul they have come to rescue, vice? >> yes,. >> and this is a government which praise praise on its people. >> preys on its people. >> rose: a lot of treasure more importantly a lot of lives and that question also i ask to the man who is the commander there, general john allen, here is his response. >> this campaign is on track. the anfs is moving into the lead. they want to be responsible ultimately for ending this insurgency, they want to be responsible for protecting the people from the taliban. they want to be responsible for ensuring the stability of the government and they are getting better every single day. so i reject the sense this is a colossal failure and those lives were spent for nothing. those lives, the memorial to

those lives will ultimately be an afghanistan that is stable, an afghanistan that is able to provide a quality of life that is meaningful to the people and an education that can get give the people of afghanistan a future and afghanistan can be part of the solution in the region, a volatile region which if we left this to the taliban it could sink back into the darkness and be a launching launching pad for terrorism and this is an important mission and i reject any stipulation that the lives lost in this mission were wasted. >> rose: and nobody wants to say to any parent and any loved one that they were wasted. >> of course. >> rose: so -- one american official, one, this man, who is on the ground, the commander saying, we are on track. >> on track? >> rose: march 26th 2012. >> remember, though, and maybe

we are on track, right? maybe the afghan army will surprise us all. but maybe they won't, and again we are pulling out. i mean this is -- what we are doing now is we are setting this up, the afghan army as fast as we can with as many resources as we can and spending $11 billion a year trying to do there so we can get out by 2014, i mean in is triage, you know, and maybe the force that we stand up so many afghans do fight and they are pretty good, maybe it will work. i think what troubled me driving around the country and i went to the north and i went to the center part of the country and the east, was when you get down there on the ground it doesn't look quite as good. >> i am intrigued by the fact that the special forces and the cia and all of the american national security resources could find osama bin laden but they cannot find omar.

>> i can tell you what people tell me. >> rose: okay. >> you know, that the isi, the pakastani intelligence agency knows exactly where they are or if not exactly they can find him pretty quickly. somebody said to me an american official the other day, you know, if mullah omar says the wrong thing, publicly, we will get a different mullah omar. that basically he is under the protection, he is almost certainly in pakistan, he is under the protection of the pakastani government, and again that is a whole different -- that is a whole other ball game. >> rose: this is a government we are giving billions of dollars to in aid. >> yes. and they have -- i mean it is very complicated but they -- the evidence is that they have protected the taliban as much as they have fought. >> rose: and again the united states could do nothing, had no influence on the isi in order to get them to give up mullah omar or at least say -- because they didn't even do it with osama bin laden. >> right. i mean, we don't know yet

exactly what, if any, role the isi had -- >> rose: ons osama bin laden. >> yes. >> and everybody says they have no evidence that the top officials in that government knew. >> that's what i hear too. yeah, i don't know. i mean, until i see evidence -- >> rose: can we negotiate our way out of this thing? >> we would like to. we would like to make a deal. why not, right? on paper it looks great. yeah you go to the peace table and you sign a deal with the taliban and the war is over. that is kind of, you know, that is the beautiful scenario. it is extremely complicated. basically for two reasons. one is the taliban, they know we are leaving for the most part, they know we are going to stop fighting by 2014 what possible incentive do they have to negotiate? i think general allen, i don' i don't want to sr him is but i think what they would say is what the american officers say we have been hammering the taliban and decimated their middle ranks of

their leadership and they are hurting very, very badly and they do want to make a deal, i am not so sure of that. i have heard that before, you know, general mcchrystal said to me three years ago, you know, the taliban are not a guy night number, you know, they have an infinite capacity to regenerate. >> rose: the troops. >> yes. >> rose: new troops are always coming in you can't kill your way out of this thing but the second point you ask about negotiating, making a peace deal with the taliban, the other part of this which is extremely complicated, a lot of the afghans don't want it, the north, the minorities, who suffer the most under the taliban, they are extremely suspicious and very wary of making any kind of deal with the taliban. >> rose: they say it is just delaying the inevitable? >> well, they are terrified that the taliban are going to come back -- >> rose: and -- >> yes that karzai is going to possibly bring them into the government or basically allow the taliban -- look the simple deal everybody talks about in afghanistan, what kind of deal,

what is the simple deal? it is g if the taliban the south and give them the east, give them those provinces and call it peace and walk away. there are a lot of people in afghanistan that could not live with that. >> rose: you and i have heard for a while this idea, the americans will leave, that's what they did before, and that's what they will do and that has been at the core of the reason they played it the way they did. the taliban. >> yes. the tall want, taliban, pakastanis, everybody else. >> absolutely, people ask why aren't the pakastanis on our side and the answer is, they don't trust us, we don't trust them but they don't trust us. they don't trust us to stick it out, so their biggest worry is on the western decide of their border is they are going to have another civil war as they had 20 years ago, they are going to have chaos and they don't want that, and so they have got a player in the game and that player is the taliban. >> rose: right. >> and that is the player they

have. >> rose: so does this consequence have an impact on the region and our possibilities in the region? >> definitely. definitely. i mean, i think, look, i mean if there is a civil war in afghanistan or chaos and anarchy that is bad for the afghans, right? everybody knows that. but it is bad for the united states potentially, i mean if you -- you don't have to look back that far, 2001, 9/11 attacks, they came about because of the chaos in afghanistan. it opens the space for the taliban, they came in, they allowed al qaeda to flourish, and then we have the 9/11 attacks, nobody wants that to happen again and that is the worry. >> rose: this magazine article is called after america, when the soviets left afghanistan erupted in receive war. as america, what can be done to prevent this. >> when we come back we will

talk about the presidential election of 2012 with james carville and stan greenberg. democratic strategist james carville and stan greenberg are here, they are both advisors to president bill clinton during the 1992 presidential election campaign, and the reelection campaign, the famous mantra of that campaign was, it is the economy, stupid. now 20 years later, the 2012 presidential campaign draws closer and is, in fact, underway, carville and greenberg have a new battle cry, it is also the title of their new book, it is called, guess what, it is the middle class, stupid! they believe that the single biggest problem facing the country is the deterioration of the middle class, i am pleased to have them here on this program. back at this table, welcome, good to see you. >> let's do relationships first, i mean coming out of the campaign, look -- have you been friends since the campaign? do you have -- >> my kids say we are like old

ladies. >> ah. >> you know, we talk 7:00 o'clock every morning, in the clinton campaign, we met before seven every other morning, but 7:00 every morning ever since. >> it is kind of an odd -- short jewish guy from washington, d.c. who went to harvard and here is the cajun guy from rural arkansas. >> it is a, george stephanopoulos to rob em man to you name of it people who stayed close and stayed together all of these years, it was just a remarkable thing we had. >> rose: bill clinton, where do you think he will go in history? >> i think it is hard to think of a facet of american life that wasn't better the day that bill clinton leftovers than the day he took office and one of the thing we discovered in our book and research is, since 1979 the only period that we had any kind of income growth in middle class

americans was during the clinton presidency. it was the only time. in terms of people that we like, care about, the working poor, the people who work, that is our kind of emphasis here, if you look at the income tax credit and look at family medical leave and you look at the -- president obama getting it done but attempts at universal coverage for healthcare these are things that really affect what we call the lower middle class a lot, so to that extent i think people look at him fondly. >> rose: what is happening to the middle class? you are the guy that knows the numbers. >> they know they are smashed, they are smashed and what is most striking about this because we have got people, get all of these groups together and spread them all out, and looked at the totality of what was happening over three decades, and what you begin to realize is, it wasn't just the crash, the financial crash that took them down and that was bad, you know, they lost 40 percent of their wealth,

you know, from that crash, you know, but my partner says in this, you know, they -- the patient had pneumonia before it got hit by the pickup truck and they are very conscious of the fact that they are dare their jobs are paying less and less, less likely to have healthcare and pensions, you look at the first job someone out of high school gets right now, 20 percent chance of having healthcare, you know, benefits. you know,, the job, the pay is 1973, you know, they are hifg with a long-term decline when they think of the country and they think middle class, middle class is not just a term we use, it is a set of values, it is an aspiration, it is what our parents both thought they were doing for us as, you know -- and it would create the next generation, they all know that, you know, that, they are struggling and at the edge and in pain, they are waiting for a politician that recognizes them and responds, that's why we wrote this book. >> rose: what kind of politics is that? >> with them in the middle, i mean, the biggest inclusion we,

conclusion we came out of this book after doing it was that there is always a reason to look at some other problem, the deficit or that problem, but there -- you are not -- america is just not going to get unless you say the most serious problem we have to address is the future of the middle class. >> rose: do you look at both of these campaigns so far and say they are not responding in a way, they are not proposing campaigning, speaking engaged by this -- what you would like to see? >> let me talk, ncs, i have to follow this up. obama is honestly is like 20 types better than romney, romney is totally -- i mean it is just this wonderful story about a fund raiser he had in hampton you would have thought they were making it up, but from -- the ryan plan would just literally wipe the middle class out in this country, if there is anything left of them they won't be standing if the healthcare goes up $6,000 a year, in the face of medicare, so, sure, i

mean, i think president obama has been much better of late, but understand that we come from this from a little different position. stan and i, believe this is the greatest problem the united states is facing is what do we do about the middle class in this country. >> rose: two things though it is the income inequality and the middle class or do you want the economic growth? >> inequality is an important subject and a lot of people write books about these and these are good books -- >> rose: income disparity? >> the lack of income growth among the middle class, the disparity, i would say would bother us -- if the middle class line was rising and people were getting into it, this is not a week about, this is not a book about inequality but people falling out of the middle class or struggling like the dickens to stay in it, and the thing that got me moving is political people all talk to each other, and everybody knows this, you cannot do a focus group, which

is an instance you get ten, 12 people around a table where somebody doesn't break down crying. their lives are -- >> rose: because of the circumstances they are in now. >> right and these are not people who don't want to work, they worked all of their lives and people who say it is -- it never happened -- >> rose: and they are losing what they have. >> oh, are they. >> understand that -- and even though it is really, really tough, they are not focused on the short-term, they are not saying who can do this for me now? they are the one in this whole mess who are saying, this is a long-term problem. we have watched the president try to take credit for job growth or, you know, understandably, but they are not interested. they want to know, and including similar us, great reluctance to support stimulus and growth packages because they want to know, we know this is a honk term problem, what are you going to do to keep american jobs. >> rose:. > u have jobs pay more and deal with healthcare costs so they are dealing with real

long-term problems and. >> rose: they are suffering from the consequences of the solutions offered so far? >> well, look, a lot of these solutions have helped them a lot, already obviously a lot better off with the policies that the president pursued than if he hadn't pursued those policies but they know it is not enough. they know they had pneumonia before this crash hit, this financial crash hit before the pickup truck hit them so they know a long-term problem and they are looking for a vision and looking for a future actions by leaders that will address that problem. and i guess our point is, just where is the presidential commission on the middle class. where is the institute for the study of the great american middle class at ohio state or princeton or colorado? where is the joint congressional committee on the future of the american middle class? it doesn't exist. because we -- and this will we learn that that is the problem that we filter everything through, then we are just going to be people like huh-uhs who

are writing books and we are going to be -- we are going to just wailing at the wall, and until this sort of focus, you go to these people with the way that they talk about their lives, they talk about this as a long-term struggle that they have been falling behind in and one that has to be busted and somebody has to do something about. >> rose: what should be the ideas that ought to be in force in order to change the plight of the middle class? >> go ahead, stan. >> we what we say in this book, is we are not policy people but political people, the first test of political people is to make sure you have an election that is about this subject, because that is what drives the day afterwards. >> rose: before you say that, suppose someone says i said yes that is true, stan but if you look at the election in 2008 you had an overwhelming democratic election, things have gotten worse. >> i wouldn't say worse. well, no. since january of 2008, i mean,

the economy was about -- i wouldn't say -- i wouldn'tn't say they have gotten a lot better but i certainly wouldn't say that they are worse. >> rose: but are you then arguing that wha what you have o is change the politics and if you change the politics you can change the future of the middle class? >> look the election hasn't been about the middle class. i mean, this is new. i mean, it is not new -- you know, bill clinton ran in 1992, but it has been lost, and, you know, the focus of the middle class is new, that's why it is the middle class as the title of the book and if you have an election that is -- when bill clinton had an election about it is the economy stupid, when he did the address after the election he said i am not going to look at the whole state of the union and just talk about the economy and talk about how we get that fixed. if we have an election that is just about the middle class, and by the way the politics helps elections elects democrats and get a majority that may be able to do something about it, but then that creates the mandate,

the context, context for acting we need both things they are open to big bold things as long as you are focused on the future. >> yes. and understand the election of 2008 was about hope and change, it was not -- it really wasn't so much about the middle class. i mean the president, in the defense, in senator clinton's campaign was more about the middle class during the primaries. >> rose: and in pennsylvania -- >> did come some what in pennsylvania, but the issues -- let me give you how it plays itself out. everybody that we know says the biggest problem we have is we have to do something about entitlements. all right? we think that is completely wrong. we think you have to do something about healthcare costs if you do something about entitlements and do what they are suggesting if you shift $6,000 of the cost away from the government to the middle class, you have ruined tens of millions of lives, but if you just spent on healthcare in this country what the next nation spent, you wouldn't have a deficit and you

wouldn't have to do any of this. so it is not that the healthcare spending is not what the government spent is a horrible problem, not a horrible problem but maybe smart people ought to say maybe there is a better way to do this without wrecking everybody's lives and do something about costs, and to give the president credit, i think his bill is going to help in that direction, but you have to keep doing this and doing this and doing this and focus on it. >> rose: but clearly, everything you said so far is true about what is happening in the middle class, it is reflected in all of the focus groups you guys have done and everybody else does you feel that concern, that agony, that despair, on the other hand the deficit is a huge problem, and everybody knows whether it is people looking at us from afar, that if we don't get our economic house in order we are going to be in a very bad place and if you don't get the economic house in order by in part both looking the at the revenue decide and the cost side then you will be in trouble, that's the only way to do it.

and you had simpson-bowles and other groups try to come forward with some kind of solution and entitlements is a part of that. >> but understand, we spent about 18 percent of gdp on healthcare, the next highest among the industrial nations is among 12, if we had that number down to 15, we don't have to get to 12 if we have the number to 15 many of these problems would be -- >ere is what some people will say healthcare reform primarily dealt with access and did not deal with cost containment. that's the argument -- >> i won't get into it too deep but -- >> rose:. >> we do say in the book they have to double down on healthcare and go further, not just with the status quo. >> look, i work in britain and work for the labor part in britain and focus on policy there, they raised taxes, you know, first and then they addressed the deficit in

britain. >> so addressing deficits first, and less deficit reduction, what we are saying here is focus on the middle class and then being able to have jobs and income and if you do that you are also in the process, i believe, process probably do better on addressing the deficit. >> this argument is being made in europe and here which is the idea that if you are too austere in your budget and in your proposals and in your effort to deal with the deficit you eliminate possibility of growth and there is no way for us, with all of the conditions without economic growth. >> i think it is more argument it is just plain -- >> this is something very important. look, if the crushing debt of the united states could that be terrible for the middle class in a country? of course it could. but if you solve it -- destroys what is left of the middle class, what do you have? if you say the biggest problem we have

is a country is the fact we can't bro the middle class or people are falling out of it then that leads you to a different set of policies to deal with the deficit, it is not saying -- we are not suggesting to you in any way, shape or form -- we were the ones who did deficit -- >> >> rose: in the clinton administration. >> we were for it. >> going to $6,000 a year, that is going to mock them -- they have no chance at that point. and what would do that? >> the ryan. >> rose: the ryan budget? >> let's, let's talk about simpson-bowles as well. >> rose: you are against simpson-bowles? >> look -- >> rose: the president is supportive of -- >> he is more against it than i am against it. >> rose: he understands -- >> i think that the communications on this thing has been terrible. i think that --

>> not so much about the president, the president wants more than simpson-bowles. >> if you read the piece in "the new york times" he was going to offer them more than simpson-bowles, and eddie haskell what is his name, cantor, wrote a, wrote the thing, rolled the whole thing up. >> eric cantor. he looks like eddie haskell to me. >> rose: and what you look like -- >> like a fish that swam too close to a nuclear reactor. it is the 40th anniversary of the -- it was out of a love scene of deliverance. >> rose: i won't make that call. >> i was express anything respect for simpson-bowles. >> they raise revenue and did brave things in the polarized

context we are in, there is actually a letter, open letter to -- a private letter to tom friedman in this book where i say, look, but you can't come to this book -- people -- the biggest problem is people are spending more and more of their own -- social security is a higher and higher proportion of their retirement and right on the edge. and the idea that you would solve this problem by raising healthcare costs for seniors is just a killer, that is killer, and if you say the main problem -- >> rose: but ryan doesn't speak to social security? >> he talks to medicare. and simpson-bowles, and both say the main problem is healthcare spending by the government. now if that is the problem, because it is true, rising healthcare costs for the government if that is the problem, the deficit, then it is fine to move that money away from the government on to seniors, but if you say the biggest problem we face is the middle class then you say, we have to address healthcare costs andrea matt economy. >> rose: since you cite in

this letter tom friedman, paul krugman, are you essentially saying that pretty much what krugman argues is what you believe in terms of economic policy? >> we certainly, i can't speak for -- you know --ment. >> we differ about -- we agree on what his analysis zero is of what happen and we agree on what we have to do to get us out of the depression. and the voters saying the issue is not getting out of this recession. it is the three decades of income decline, stagnation. >> right. >> and job loss and rising debt, you know, and actually corruption -- >> rose: decades of what now? >> three decades of stagnant incomes, job loss, you know, out of america, and rising, both public and private debt, all of

that problem precedes the crash, and getting us out of this depression is not enough. we say you have got to go -- >> rose: for democrats and republicans can contribute to the circumstances of the crash? >> oh, come on. >> leading up to the crash -- >> with the exception -- >> let me be careful here with the exception of the 90s, you have one democratic president from 1980 to the crash which occurred in the 2000 -- >> it was during that time -- >> rose: reagan, bush, clinton. >> it was only, only during that time that you had income growth among the middle class,. >> rose: what do you want to do and see as part of -- >> first of all i want to say the democratic agenda on healthcare to be very, very serious about bending the curve, or reducing the rise of healthcare costs which is the

number one cost of bankruptcy. >> rose: how do you do that? >> >> there is stuff -- first of all, medicare delivers healthcare more cheaply than private insurance. all right? and there are people, i don't have you to get healthcare accounts, you know -- >> rose: single pair option -- >> i am going pass the single pair option, i mean, come on. >> look we have to -- we take healthcare -- >> let's hope it gets upheld by the supreme court, and then let's take it as far as we can. take the reforms that are in there, and we even go and say maybe we ought to consider going to a full individual mandate, where insurance travels with the individual rather than employment as a way of really getting in a competitive, using the exchange in a very comprehensive way, try to get healthcare costs down.

we show, offer a lot of ideas here on how to go beyond -- use the healthcare reform to go further to try to drive down costs. >> look at what is happening in education, particularly higher ed. we are not even certain today that the cost of a college degree is worth the price of it. and look what is happening in every state, in the state of louisiana, when you have like 40 percent cut in the state allocation to that and everybody says, you know, well we have got to do this because it is these times. why can't we do other things? why is education always -- we have lost i think i want to say half a million school teachers in this recession. i mean, that is going to help cutting school teachers and cutting state universities? that is going to help grow the middle class? that makes it early no sense at all. >> rose: tell me how the president falls short of doing what you want him to do and how much of it and why do you think that is? >> well, look, i think the point we make in the book is, that

this is the sort of focus right now of our time, what do we do about this? and -- >> rose: and i want to talk about the president. >> >> rose: no, i do because you keep trying to bounce away from it. you evade the question. >> i don't evade the question. i this at this president, i like the idea he wants to take top tax rate to 39.6, i think -- >> rose: you like the idea he wants to extend the tax, bush tax cuts or another year. >> for the people under 250,000, right. >> rose: extend the tax cuts -- >> yes right now i wouldn't -- >> rose: more than a year -- >> if they propose a year, that seems like a good deal to me. >> rose: all right. >> okay? i am fine with proposing under 250,000 a year. >> rose: the buffett rule and that kind of extra taxes -- >> yes, that's fine i like 39.6. >> rose: do you feel -- why do you think the president has not done more? >> because he is faced -- i mean, come on, the reason he hasn't done more? you have

seven, he is losing 750,000 jobs a year, the banks have literally blown up the world, by the way, ma film laying interest rates and god knows what, they have done -- they put a lot of things in place that could be helpful in the short-term but what we are arguing here is the real future focus is, how do we -- you know, how do we build the middle class, let's make that the mission of the second term, we understand you have a different mission in the first term. >> rose:. >> you would like to see the president or even governor romney say if i am elected the first thing i am going to do is assemble the smartest people i can and bring in you and you, there is no joint committee on the middle class. >> i would. >> right. and bill clinton has said, you know, this election ought to be about the future. >> rose: right. >> right. >> rose: the middle class the future of the middle class and the relationship between the united states and the rest of the world. >> and the president is saying -- >> rose: what is wrong with the president saying if i am

elected. >> nothing, great, okay, if i am elected i will appoint a commission to make recommendations on the middle class and i am going to bring in the top ten university presidents in this country and i want somebody to have an institute for study of the middle class and i want to generate ideas about this, i want to know what has happened and have all data available. we have spent billions of dollars on this thing and that thing, all of which are important, okay? climates is important, the deficit is important, all of these things are important you know what, if somebody says i want to focus on heart disease that doesn't mean you don't care about cancer, you don't care about aids or you don't care about something else, the point is, that middle class the deterioration of the middle class does not get the attention that it deserves in this country, that is why we wrote this book. we are not making a perfect policy -- >> rose: let's show how naive i am. if you a smart politician, the

most important thing you can do is to try to make an appeal to the middle class and say that i hear you, i am going to propose things and in my administration as a february of congress or as the president, i am going to do things that deal with your issues. now, they may say we are doing it and that's the difference in the two campaigns, but i mean -- >> as political guys what is more important for electoral success than saying to the most, largest part of the american population, -- what the president is trying to do -- >> moving to that point. >> rose: so back, so back to my question, in at the moving to that point to suggest he is not there. >> right. one of the problems we had and we are very public about this is when the president would say that the economy is getting better, that we would say that is not, when middle class people would not hear this, and during the clinton careers we were

never able to talk about the economy until 1996 it takes a long time for the effect office a recovery to get to the middle class, many people feel it before they do, and have any kind of job security. what we do believe, and we have talked about this is that the president's message is getting better and more focused. and so what i am saying is, if it is improving i want to give him credit for his improving some what. >> rose: i keep asking why there was less of a sense of this despair before he started changing. i can't get you to say -- >> i don't know, i don't know. that is the real answer but i am glad -- >> rose: now if he was sitting with a group of his best friends, political savants would he say, i don't know or would he say i don't want to come to this table and talk about it. go ahead. >> look, everybody, look, bill clinton would have rushed with those job numbers, job must be to get in front of the camera and say the camera is doing better and trying tried to in

'94 and it didn't work. >> i had a conversation with a politician it may very well turn out in this election the most important thing that barack obama did in his first three and a half years is the auto bailout, because in michigan and ohio, it is huge; is that right? >> it matters a lot, and there is no doubt i have been to ohio and michigan. >> rose: jobs for the middle class. >> jobs for the middle class and in those two states, he is much more favorable than elsewhere. >> rose: if you are going to have an influence. >> but it didn't define him as believing in rescues and bailouts as an economic philosophy, i it definned, defid him, although tarp happened under george bush, people believed the elites of both party came toll together to bail them out without dealing with the middle class. >> rose: and that's what fueled the tea party? >> tarp, without any doubt, was the most symbolic policy was tarp. >> rose: along with healthcare reform? >> eventually healthcare but tarp happened even before the

election, got defeated in elections, tarp is the -- >> i think it is one of the great policy decisions, gutsy decisions but you do not hear this rarely, you hear it fair will i often because nobody bailed the dry-cleaners out, the working people. >> rose: so not as power as you think -- >> no, no. it is. i have watched it now and the polling must be in those two states on this issue, there is no doubt it is helping him now but it did define his economic philosophy if you asked him what is his economic world view people would say spending and bailouts. >> rose: i mean the president tried to say that we are doing this to save jobs and to save an american own company and we will own a part of these companies and when they get on their feet they will pay us back. >> the president needed to tell a story. >> rose: he could explain this. >> there needed to be a story told throughout this entire recession and recovery that said

where we have been and why we are doing it and where we are going. >> rose: it is not happening -- >> how many people do you think know they had a tax cut? the 40 percent of the economic recovery act was tax cut and every since year tax cuts has been his main -- >> rose: and. >> the problem is the economic recovery. >> it is kind of stunning in one sense they did this, it worked and, you know,, it would have been definitely been awful if he lost the oil companies, but it certainly does make a difference in ohio and michigan, but it looks, to some people like, hey they were lucky enough to be in an industry, all the banks, because i don't think, understand, i think you will fee, i think you separate the auto bailout from the banks. >> and the public's larger view of things i am sure they are both things that needed to be done but boy did they set off a chain reaction that a lot of

people couldn't anticipate. >> rose: tell me what you guys see as the competing narratives in this campaign so far between the president and governor romney. what are the competing mare it was? >> well, i think the biggest problem that democrats have is that people believe that the government is bought and sold, and that the democratic -- and that the democratic answer to things is government, that they don't trust government. there has been a real, real deterioration in the trust development. so when you bring a government solution to a problem, they are going to say, that is just all caught up in everything and it stinks. that is a narrative democrats really have to deal with and if we don't believe that and i think i am speaking for both of us here is some element of reform and let me, and we put this in the book, it has to be

the at the core of something that you are going to do something about this bought and paid for government. if you look at last night you saw it in the 60 minutes things on the, just a level of the kind of corruption if you will and that they see every day and they view to some extent the banks and i guess to a less extent to some extent the auto bailout as part of that and they just don't feel like they have, the government is out for them, that they are out for the really powerful and for the interest groups and stuff like that and you know what, they are not stupid there is a lot of truth to what they say, a lot, it makes me uncomfortable to say that but it is and our first policy recommendations wit whice pretty bold are on campaign finance reform, lobbying, reform because you have got to clean up this government, if there is going to be an act on the behalf of the middle class that's the starting point. >> rose: and how large is an issue and maybe a part of this dysfunction in government what we see in the inability and the fights that took place over

raising the debt ceiling? >> and it is a central piece here. they think nothing can happen here that can help the middle class because they don't trust the government and wall street. >> rose:. >> they claim both. they blame republicans more in every poll we do by about ten, 12 points they say republicans are more responsible -- >> rose: why doesn't that have a hand in the election? >> the economy. >> rose: what do you think the narrative ought to be for this campaign? >> well, there ought to be -- well, where we are right now is you have, you know, you have mitt romney trying to say this is about the economy and the economic performance of this administration. and if you think that they have failed to make things better, on the economy then you should vote for us. if, in fact, that argument becomes the dominant argument. >> it will be a tough election. >> if that were the dominant argument -- >> rose: romney wins? >> if you look at the poll numbers when romney moved ahead, it was during a period when the

administration was -- >> rose: badly -- >> no, no. it was saying, you know, we have created x number of jobs in the private sector, you know, it is healthy, when they were in kind of an up beat, we are moving in the right direction, you know, message, you are then the in that debate with romney about -- >> rose: the shorthand is -- the romney campaign, the conventional wisdom, the conventional wisdom is now if in fact governor romney can make this a referendum on the obama economic performance he wins, do you accept that? >> no, yes, he would but, but he has a lot else going on but what he said zero on the job numbers this was a kick in the guts of the middle class, so he put it into the frame of the middle class, we want that, that is accepting what the president is saying, is that the future of the middle class is what this election is about and when we move to the future, on any choice you want to make about how to go forward, obama --

>> rom in i have a very, very defined challenger right now, and people, people basically, the narrative on romney is he is pretty strong, i mean,. >> rose: you believe it is beyond an opportunity for him to define himself? >> well, i am not going to say that, you know, he has got -- he has never done it as governor, he has whole parts of his life, governor, because of healthcare, religion, because of mormon, there is a whole bain, his job creating record, bain, we have a whole series of parts of his life which are problematic which can't be revealing about them, so i think there are hims to how far he can go. >> rose: by november the questioning will really be who do i trust more in terms of debt, creating jobs, all of those important -- >> but going back to sam, my, stan, they are going to trust someone that use this is power and intelligence in how to do it in some way to trust to use it

in a way that is helpful to the country, and if it is more receptive -- i mean, i do think anything can happen, as i pointed out earlier in the show but romney, he has a tough sell between now and election day because there is -- >> i would rather be in obama's position than romney's position. >> rose: not withstanding where the economy is. >> notwithstanding the economy i would rather be where obama is than romney. >> rose: a fascinating discussion about politics and these two guys know politics well, they come there one side of the political spectrum, but they have written about american issue that is at the heart of who we are, it is the vast middle class, and whether this country is working for them the way it has in the years, they have as many people have pointed out fought the wars and paid the taxes and in a sense always believed that next generation would be better than their generation and that was what they lived by, this sense that america would continue to grow and that america would see

people's children live a life better than they had and that was the dream of so many people in the middle class and throughout america and that is one of the questions now that the country faces, and this is an argument for not only that but also some solutions that they think and some politics that they think will go right to that issue, so i am pleased to have james carville and stan greenberg sit at this table. thank you very much. >> thanks for having us. >> rose: thank you for joining us. see you next time.

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