>> rose: welcome to the broadcast. we begin this evening with peter orszag, he is director of the office of management and budget, and we talk about the budget, about the deficit, and we look ahead to the smit in which president obama will talk about a health care in a live televised encounter. >> as you go out over the long term, there is nothing else we can do. i don't care what revenue proposals you have, what social security proposals you have, what proposals you have to reduce discretionary spending. none of that will matter over the next five or six decades unless we succeed in reducing the rate at which health care costs grow. that is the single most important thing we can do for our long term fiscal future, not only thing, but the single most important thing. >> rose: and we continue with author and journalist richard reeves. his new book is called "daring young men," it is about the berlin airlift. you'll learn a lot about your country and about the people who came forward at a historic moment. >> my students had never heard of this great american adventure. i mean, it brought out as lincoln said, the better angels of our nature and i'm not sure any other people in the world could have or would have done what those young... the daring young men, those young americans did when they got phone calls in the middle of the night saying they had to report within 48 hours to save the people who'd been trying to kill them. >> rose: peter orszag and richard reeves coming up. ♪ if you've had a coke in the last 20 years, ( screams ) you've had a hand in giving college scholarships... and support to thousands of our nation's... most promising students. ♪ ( coca-cola 5-note mnemonic ) captioning sponsored by rose communications from our studios in new york city, this is charlie rose. >> rose: peter orszag is here, he is director of the office of management and budget. it is the office that drafted federal government's budget for the president. he has served a prominent role in the ocean. he helped design the dlb 787 billion stimulus plan as well as the health care overhaul bill now before the congress. as the economy has stabilized, he's bun addressing the fiscal deficits that have heightened worries about the country's fiscal stability. i am pleased to have him back at this stable. welcome. >> >> good to be here. >> rose: what do we expect to come out of this experience that's happening on thursday with the president and health care? >> well, what i hope comes out of it is agreement on a health care bill that notnly expands coverage but that helps to reduce the deficit, contain costs, and improve quality over time. that's what we need do. >> rose: so essentially you hope what happens is he convinces republicans and democrats to get on board the new bill that he is recommending, which is essentially the senate... >> with some improvements, yes. >> rose: improvements? what are the improvements? >> well, for example, one of the concerns had been the degree of costs imposed at the very bottom of the income distribution, so called actuarial values that were contained the in the plans in the senate. the president's proposal addresss that to some degree. so there are a variety of changes that have been made that we believe are improvements upon the original senate bill. >> rose: and what about the cadillac plans? >> they're what the presidens proposal reflects is a small increase in the threshold above which the excise tax on high cost insurance plans will apply. and also a later starting date, and i know that's received a lot of commentary and attention from any perspective the key thing with regard to that excise tax is what happens out in 2020, 2030, 2040 where it can help to contain private sector costs and improve efficiencyin the private part of the health care system. >> rose: and the cost of this of this over ten years is what? >> it has not been scored by the congressional budget office but it's going to be in the range of $950 billion or so. in terms of growth costs, but it will reduce the deficit by somewhere close to the senate bill. the senate bill reduced the deficit by a little north of $100 billion over the first decade. anticipate roughly the same from the president's proposal. >> rose: you guys-- and specifically you-- always considered health care as a tool in deficit reduction. >> yes andet me be very clear about this. as you go out over the long term there's nothing else you can do. i don't care what revenue proposals you have, what social security proposals you have, what proposals you have to reduce discretionary spinding. none of that will matter over the next five or six decades unless we succeed at reducing the rate in which health care costs grow. that's the single most important thing we can do for the long-term fiscal future. >> rose: it's what percentage of the g.d.p.? >> currently overall health scare about 16% of g.d.p. it is projected to rapidly increase. and... >> rose: to what? >> well, in ten years it will increase by a few percentage points as a share of g.d.p.. the issue is it continues thereafter. and the thing that's important about the bills under consideration is... the single most important thing we can do-- and this is something bill frist wrote about in the "new york times" a couple days ago-- is remove the incentive systems for providers, for hospitals and doctors and what have you, away from fee for service and towards fee for value, towards paying for quality. the problem that we have is that we currentlyo not know exactly how to design that system. even if i appointed you dictator today and we didn't have a political system, in your opinion charge of the health care system, you would not have the nooj today in a prudent way to snap your fingers and take 15% of the economy and transform it to a fee for value system so what we need to do is aggressively test out different approaches, medical homes, paying for performance in the medical system and then have a way of moving the scale rapidly as we learn which approaches are more promise promising. and that's what's contained in these bills. you have the infrastructure to move towards a higher quality lower cost system over time even though that will require continual effort. >> rose: w do so many doctors do that? >> well, one reason is-- and this is nothing derogatory-- they are financially penalized if they don't. the most glarg example involves, for example, hospitals that have succeeded in reducing readmission. so you're discharged from a hospital and something happens perhaps because the hospital isn't monitoring you correctly or your doctor is not making sure you're taking medication and you're readmitted to the hospital. a surprisingly large share-- roughly 20%-- are readmitted. hospitals that have succeeded in reducing readmission rates have concluded they can't financially afford to continue the practices because they're losing too much money from the reduced readmission rate. that makes no sense. >> rose: one of the things that republicans always say is that why don't they want to make a deal about tort law? >> well, i think the president has expressed-- and he did, in fact, when he gave an a.m.a. speech last year-- some openness to exploring different ideas. >> rose: he says he's open to every idea! that's basically what he says so there's no big thing to say i'm open the the tort law. the question is how serious is he and where are you prepared to move? >> but i guess i'd push back and say if that's the deciding issue let's see a comprehensive plan or a statement that says with this additional piece we now sign on. one thing i would note on medical malpractice is the same people that criticize the existing bills for not reducing costs efficiently, not reducing the deficits efficiently use the congressional budget office as the basis for reaching those judgments. here's the point. the congressional budget office has said most of the medical malpractice reforms throughout despite what doctors and hospitals lieve don't do very much to reduce costs and the deficit. >> rose: fair enough. >> that having been said, the whole purpose of thursday, the event? which you're going to have a gathering of both republican and democratic leaders is to have that discussion. so if there's a specific idea... people say medical malpractice reform, does that mean caps? does that mean a medical court? does that mean safe harbors for evidence-based medicine? what exactly is intended? >> rose: every aspect of the conversation should have been discussed before. health care has been the president's primary domestic goal since he... since the inauguration. >> and the president has put forward a plan, specific plan, that expands coverage, reduces the deficit, will put in place an talk from which you are that will help contain costs over time. and i guess what i would say is weeed... there may be things that, look, will be difcult to do but that if that's what necessary let folks step forward and say with this specific change i will sign on. because it seems to me unfair or not correct to say the president should go out there and start embracing different ideas that he may or may not support in exchange f what? exn exchange for not even getting... >> rose: what would have been wrong for the president to have been much more and you and everybody involved in this effort to have come forward and say "this is what the country needs, this is what we want to do and this is our plan." because the congress conventional wisdom-- and i underline conventional wisdom-- is that the congress put together the plan. >> well, i'm not going to go back through history and start second guessing. i mean, remember, we are further in the process of getting health reform done with bills actually passed both the house and senate comprehensive health reform, than ever before. >> rose: even now after massachusetts. >> well, even now, after massachusetts it's still the case that you have significant pieces of legislation passed both the house and senate. we'll see what happens after the thursday summit. i'm more focused on the content of why this is important to do and what should be done from a substantive perspective. >> rose: i mean, hasn't that argument always been throughout? >> yeah, but let's not forget that if we lose this opportunity if we don't get health reform done now, i don't know that anyone's going to be willing to try again for a very long time. and so the question is not whether these bills are perfect, or the proposal is perfect, the question is whether it's better than doing nothing at all for a very significant period of time. >> rose: so what you hope... the administration hopes comes out on health care is what? >> i bill that reduce the deficit over time, that expands coverage so that fewer americans face the risks of both health and financial risks associated with insurance and that puts there n place the key truck dhaur will help move to a higher quality system over time. the. >> rose: and the goal always has been coverage or cost containment? >> well, here's the thing-- and i'm just going to be frank on this, too. >> rose:please. >> because some of my fellow deficit hawks say "well, why don't you just do the medicare commission? that holds promise, just do the medicare commission and the medicare savings, the reductions in provider payments, et cetera." >> rose: right. >> and what i would say... and leaving apart the moral imperative of expanding coverage, from a political economy perspective, you wouldn't get near... i challenge anyone to come up with a scenario under which a medicare commission would be enacted into law in the absence of comprehensive health reform. so, in other words, the pieces, even though they are aimed at different problems ff together formed a package that again passed both the house and senate in a way that if you just tried to split off one component you would be much less successful at doing. i think it is highly unlikely that we would have gotten anywhere nearly as much in medicare savings where they not linked to other things that were desirable like coverage expansion. and there's certainly no way that a medicare commission would have been passed by on the floor of the united states senate but if... accept if it was part of a comprehensive package. >> rose: what's harder to exrain? is it more difficult to explain health care or is it more difficult to explain how do you at one time stimulate an economy to create jobs and at the same time how do you expand an economy that will go forward in terms of reducing the deficit and the long-term dead obligations of the country. >> i don't know that i want to rank them in relative terms, but they are both challenging to explain. but nonetheless, correct or substantiveedly content is correct. which is that we need to in the short run on the deficit, in the short run additional measures that were enacted are helpful even though expand the deficit in helping to stabilize the economy. but we need to bring the deficit down over time and that seems to conflict or seems internally inconsistent but it's not. and similarly with regard to health care, we have multiple problems that need to be addressed. lack of coverage, lack of attention to quality, and rising costs. and they all need to be addressed and it does get it... it often creates a message problem when they're combined but that's just the way it is. >> rose: why is it that american health care is a larger percentage of the g.d.p. than any other industrial economy? >> well, there have been a few studies of this. i think leading one is from the mckin zi global institute, but there have been others. by the way, those cross country comparisons consistent within the united states studies suggesting that a very large share-- perhaps as much as 30% of the health care that we pay for in the united states-- doesn't actually improve health outcomes. but the mckinsey study suggests the higher costs re are spread throughout the system. it's partially that we are more intense users of technology, partially that we pay more to doctors but that it's basically spread throughout the entire system. >> rose: and is there judgment about the quality of american health care versus the quality of health care in other societies? >> again, at a sort of simple level, most of the studies suggesting that the quality, if anything, is lower here. what i would say though that at our very best institutions, if you face a complicated medical condition the reason that you see foreigners often traveling to the united states to receive care is that our top medical facilities are the best in the world. the problem is that our top medical facilities often are practicing medicine in much different ways at much different costs so comparisons of even our leading medical centers suggest costs are sometimes twice as high at one than the other and they're both world class. >> rose: can you learn anything from lookingt a cleveland clinic or a mayo? >> absolutely. we have examples... this is the stunning part. we have examples in the united states of world-class medicine being delivered at much lower costs than at other institutions with the united states. and if f we can move towards the practice norms that exist at cleveland, at mayo and so on and so forth, we would not only have higher quality, we'd have a lower cost, too. >> rose: but do... but are those people who run those systems and understand how good they are but also what the problem of the system are, are they completely on board about the health care reform proposals passed by the house and pass by the senate and now argued by the president? >> i think they generally believe that the legislation under consideration is much better than failing to act. >> rose: may not be perfect but better than... >> sure. there's always more than can be done. when i was back at brookings i would write about how much more could be done. it's different when you have to face the constraints of what's actually possible. >> rose: that's interesting. you have now been-- more than a year-- director of the office of management and budget. you have seen and studied the numbers and tried to make them work. so being in the pilot seat has made you learn what and understand what thaw that you didn't understand before? >> that it's a lotasier to write a paper than to get a proposal enacted. >> rose: does that have to do with politics or something else? >> it has to do with political economy. in other words, it's easy to write an academic paper... it's not easy, but it's easier to write an academic paper laying out... >> rose: how things should work. >> how things should work. it's much harder when you have a real-world constraint of not only the congress but imperfect knowledge and the details that come with it. it's a lot easier to write a conceptual piece than to actually write a piece of legislation that gets it done. >> rose: as you know, there's a whole big debate going on of which the subject is does government work. are we in gridlock? has washington in a deep freeze? >> well, i think there are areas where we can get a lot done, but there are underlying forces that need to be overcome. and i would point to both the fractionalization in the political system, the gerrymandering, the effects of gerrymandering that leads to polarization among elected members of congress, for example. and then, frankly, changes in technology in the media where you have the blogosphere and new forms of communication that is leading to polarization in how people receive their news and a payoff to being extreme rather than doing your home work. >> rose: so what do we need change? >> well, i don't have the answer to that. but i do know that there are... >> rose: you're an economist rather than a political scientist. >> yes, exactly. but i do know that we have been able to overcom those challenges in the particular areas. i will point to education, for example, where i think we can make significant progress on a bipartisan basis to improve the educational system in the united states. it's one of the things that we invest more in the administration's budget that we just put forward. >> rose: i'm... lots of people who are critical of the administration on a number of issues on education are saying there's a case where they laid some new ground work and have surprised me with the achechlts they have made. >> and i think there's significant progress being made in elementary and secondary education. i'd also point to higr education. one of the things that i think is not fully recognized is we've had a wind at our backs over the past couple decades because average educational attainment in the united states has been rising. that's now flattened out so we no longer have that. we either need go back again and try to get more kids to go to college and complete college or focus just on improving quality. there's a lot we can do to encourage more kids to not only enroll in but complete college, one which is to focus on the pell grant, which is the main form of assistance to low and moderate-income students. but i'd also... even simple things. there was a study recently that the application form for financial assistance to go to college, federal assistance, is more complicated than a tax return, even though most of the items come from a tax return. simply prepopulating the form with the information from the tax return and then filling in the other five or six questions raised college applications and college enrollment by almost 30%. >> rose: already, this is paul krugman on our program on february 18, last week. here it is. >> you have to bring health care costs under control. and if you do that, then you're still left with a fairly sizable gap, but not a huge one at the kind of thing that almost surely the bulk of it has to involve raising more revenue. you know, the united states is the lowest taxed nation among the major economies. if we move to just moderately higher taxation then there will be endless negotiations about what form that will take. that plus health care costs control brings us within striking distance. >> well, he's absolutely right that the key is health care costs. and then beyond that, look, we still face an underlying fiscal gap. that's why we're creating a fiscal commission that is intended to not only help bring the deficit down over the medium term but also over the long term. >> rose: do you think it will work? >> i think it will. we have alan simpson and erskine bowls who are... >> rose: republican/democrat. >> republican/democrat. but willing to work hard on a bipartisan basis, know the issues and know washington. so when isaid i think it will work, 100% guaranteed? absolutely not. >> rose: even though most people look at it and they say anything that causes... that talks about a tax increase no republican will buy into and anything that talks about sere qlous spending cut-- certainly in welfare programs-- no democrat will buy into. therefore there is no possibility of funding a commission that willbe able to prescribe a result that will get bipartisan support. >> well, that needs to change because if it doesn't we will ultimately wind up with a fiscal crisis. so we have been very... the administration's been very clear: everything has to remain on the table, the commission has to go and do its work and folks should not go into the commission with strongly held preconceived notions of what is or is not acceptable because we face a gap... i mean, it's not complicated. spending is higher than revenue. there has to be changed that are made in order to bring it under control. >> rose: what's the red line for the administration on spending and on taxes? >> well, we've put forward what we support in terms of spending and revenue and that's in the budget. but with regard to the commission, we've been very clear. everything's on the table. the commission can go do its work, consider options and i think that's exactly way it should be. >> rose: and what do you think the commission might come out with at the other end? >> hopefully a set of proposals that reduce the deficit by 2015 to no more than 3% of the economy, that's the goal. and also help on the long-term fiscal imbalance. >> rose: but can you do it without a certain austerity program and a certain tax program, certain revenue-enhancement program? >> well, dollar whole variety of combinations that will get you there. >> rose: and do you have one in your mind? >> when i was at brookings i had 60 or 70 in mind. >> rose: they all worked at brookings, didn't say in >> the issue is not writing down on paper ways to get there. the issue is building a coalition that supports a particular approach. that's exactly what erskine and alan simpson are going to do. >> rose: so their responsibility is not so much to lay out an... a plan, but to, what, agree... >> i should have been clearer. it's not... and maybe they'll come upon some new solutions. that would be great. but i don't view the problem at this point as being fundamentally a technical one in terms of coming up with new ideas. maybe they will. but the problem that is fundamentally how do you bring people together around an approach choosing from one of several that are out there? and that's what i think they're going to be focused on doing. >> rose: recently-- and i've had a series of people who have talked about in the past where republicans and democrats sat down and they tried to work it out. you know, whether it's people who've sat on... nick brady, for example. you know, talking about commissions he sat . and henry kissinger, commissions he sat on about central america. and they hammered out something that was acceptable to both. that's the problem. >> rose: that's exactly what we need. and, look, i'm very encourad. the discussions we've had with bowles and simpson suggest that's exactly what they're going to try to build. that kind of spirit of cooperation, even though both sides there might be things that... you know, one side or the other doesn't like but they recognize they have to step into the boat together or it won't get done. >> rose: here was the administration's proposal at the beginning. what we want to do is deal with... we want to stimulate the economy first, then we want to do something about health care. we want to do something about education. we want to do something about climate change. >> dealing with the economy was a very important step... >> rose: that was the stimulus program. >> don't forget, the recovery... in fac there was a new analysis out by the congressional budget office today suggesting the recovery act has played a massive role in why we've moved from almost minus 6% real g.d.p. declines at the end of 2008 to almost plus 6% real g.d.p. increases at the end of 2009. now, it's not where it needs to be, but we're moving through a cycle. there's this three-stage process as the economy recovers. first rapid productivity growth-- we're seeing that. second, stabilization of the work week and increase in temporary hiring-- we're starting to see that occurring. and then only finally an increase in actual'm moment. we'd like to accelerate movement from the second stage into the third stage and that probably will take some time. but at least we're well into the second stage. >> rose: is there a new normal coming on which employment numbers will settle in at a level that was higher than we'd experienced and in which u.s. growth rate will set until at a number that is lower than was the norm in the past? >> one of the reasons we're so focused on the getting the economy back on its feet in the recovery act and a new jobs bill is to avoid... this was a concern during the 1980s, we have seen a significant increase almost a doubling in the share of the unemployed who are long-term unemployed. that's more than six months or so. the median duration of unemployment has doubled over the past year. one of the real concerns there is as people are out of work for too long their skills atrophy, they might lose motivation and they fall out of the labor force. we have to prevent that have from happening because if it does we will suffer the long term... we will suffer economic negative consequences for an extended period of time. >> did the stimulus program create enough jobs... you know, larry summers used to say timely targeted, temporary. >> you know, i think despite what some of the... >> rose: conventional wisdom. >> conventional wisdom was, although i think conventional wisdom is shifting, i think the book version of history on the recovery act is going to look back and say it was enacted very rapidly-- which is a good thing. >> rose: it's true. that was true. >> the spendout has occurred as initially projected. it's on track. it has done a substantial amount avoid economic catastrophe and help to restore economic activity. and here's the final part and i give credit to the vice president on this. we have not seen a-- knock on wood-- we have not seen the kind of fraud and abuse that you would normally think was a big risk with a program of this size with money movi as quickly as it is. and that's i think attributed to the vice president's aggressive activities to try to avoid that outcome thus far. >> rose: so answer this: at what year will we see most of the deliverance on the new jobs created by the recovery program? >> by the end of 2010 you're going to see roughly 70% of the money spent out. >> rose: so the end of this year you'll see 70% of the jobs that are going to be created by the stimulus program created. >> of the money spent out. and peak employment also occurring around that time, yes. >> rose: how much will you have spent in the money by the end of 2010. >> according to the congressional budget office, roughly $200 billion in 2009, roughly $400 in 2010 so a total of about $600 billion. >> rose: leaving a hundred plus billion for 2011? >> correct. >> rose: okay. give me the long term belief that the director of the office of management and budget has about reducing the deficit over the next ten years. >> deficit has to come down. a big part of it will involve economic recovery as the economy recovers, revenue goes up and certain kinds of spending comes down. that should cut the deficit from about 10% of the economy to about 5% of the economy. we've put forward $1.2 trillion above and beyond that. that's still, given the depth of the whole that we face, not enough and more is necessary, which is why we've called this fiscal commission. so we need to bring the deficit down because we're not on a sustainable path. but we also have to do so in a glide path that avoids the mistakes that were made in 1937 where we move to to fiscal constraint too quickly, threw the economy back into recession and that's no good for anyone. >> rose: what am i missing here that you think is essential to communicate to the american people about the budgetary and programmatic projections of this administration? >> i guess what i would say is i think we face three challenges. short term economic recovery and jobs, medium term and long-term deficit, and then also third inadequate investment in education, r&d and physical infrastructure. and the problem that we face is we face political economy constraints in each of the three areas and occasionally acting aggressively on one exacerbate it is other two. and we do face all three problems. we need to be making progress on all three. and that's what we're... we're trying to walk the line on addressing each of these three critical challenges in a sensible way. and in a practical way. >> rose: do you believe the administraon-- including the t president-- has to explain this in a way that the american public understands it? >> well, i think the president has said on health care that he's been... has been somewhat sfrus rated that he hasn't... that some of the objectives and the details of wha we're actually trying to do have not been communicated as well as possible. but i think that's partly also what's going to happen on thursday. >> re: it's always great to have you here, thank you very much, peter. >> great to be here. >> rose: peter orszag, director of the office of management and budget. thank you for joining us. back in a moment. >> rose: as the countdown to the academy awards continues, we bring you another oscar moment. >> when you say somebody is a victim of circumstance, it's very... it's wide, you know? it could mea so many things. in her case you think you know what it is until you really go and dive right into it and then you start to realize that it's almost... i always used to say you couldn't put it into a movie because nobody would believe it. this woman's life was just... it's so hard to imagine. i think we all go through tragedies and we all have our skeletons in our closets and w survive things. but what this woman survived was just unbelievable. so i left... i think as much as i possibly could trying to understand how she got to where she did in her life. >> rose: how she got to murder. >> yeah, how she crossed that line. >> rose: it has been called the first battle of the cold war. in june, 1948, soviet dictator josef stalin blocked all land, sea, and rail routes into allied occupied western berlin. he hoped the move would force the united states to surrender the city to soviet control. president truman ignored the advice of virtually all of his advisors and ordered an air lift to try to save the isolated americans and germans, a group of historic and heroic pilots-- many of them veterans who just returned home from world war ii-- were quickly mobilized and began to fly round-the-clock deliveries of food and fuel and medicine. journalist and historian richard reeves tells the story of the berlin airlift in a new book. it's called "daring young men." i am pleased to have him back at this table. welcome. >> i'm pleased to be here. >> rose: do you think most people know much about the berlin airlift? >> no. part of the reason that i decided to do this... i wanted to do a book about what i think america is and what i thought it was growing up and abu ghraib was really what made me write this book. i wanted to write about what i thought america was. and i was looking for a story and then i realized reading tony jud's book, david mccullough's, that in post-war history histories of europe, the berlin airlift had been almost written out of the history. even where i teach at the university of southern california my colleagues tended to think it happened in the '60s. it's very confused with the berlin wall. and my students had never heard of this great american adventure. i mean, it broughtous-- as lincoln said-- the better angels of our nature and i'm not sure any other people in the world could have or would have done what those young... the daring young men, those young americans did when they got phone calls in the middle of the night says that they had to report within 48 hours to save the people who had been trying to kill them. >> rose: and the man responsible most of all is harry truman? >> truman became such a hero in my mind. i think the minds of the american people and going over that history i am now relatively convinced that that was the reason he was reelected in 1948. that he saw america as its saw itself, trying to do good, a generous country trying to share what it had with other people. and i think that's why the american people went for him against all odds in 1948 as he went to save berlin against all odds. >> rose: okay, tell the story. josef stalin decides that he wants to blockade berlin because he believes that the americans will have no option but to leave and then he'll own it. >> well, we certainly would have had no option. we had 6,500 men there. he had four million soldiers of the red army. they kept the red army in germany, in east germany and in eastern europe because they had never been paid during the war.f his army in useless currency like hitler's reich marks. and because of the symbolic importance of berlin, it had... it was the 1710 miles within east germany, 110 miles. as we would say now, behind the iron curtain. and the idea... it was not only that we could spy on them and know about them, it was that eastern europeans would see how westerners lives if that... this island of the west were left in the middle of communist country. that's what he wanted to get out. and he thought-- ando did all of truman's advisors. robert loaves vet said "mr. president, don't you understand the russians need need to drive us out of berlin" and that was the case, and the one thing he could do was fly things in by air because international air codes created three corridors flying into the city. >> re: here is harry truman, a former has been dasher, a former vice president who hardly knew anything about the preparation for world war who when he... at the end of world war ii when he took office at the end... the death of f.d.r. george marshall is the much admired secretary of state and former chief of the army during the u.s. military world world war ii. >> rose: >> omar badly the chairman of the joint chiefs of staff. >> rose: the great world war ii sort of general and they're all saying... >> don't do this. >> rose: don't do this. and what does he say? >> he listens, doesn't say a word during the meeting, he takes a vote around the table, every single vote says... >> rose: serve in >> everyone. this cannot be done. it was pragmatism to a certain extent and truman says "we stay in berlin, period." anwalks out of the room. and then we had to figure out how to do it and find these known do it. we had only 37 c 47s d.c.-3s in germany when this began and at the minimum we figured it would take 4 shgz 500 tons a day to keep western berlin-- which had two and a half million people-- going. our planes were... we had totally demobilized and on the night of june 26, 1948 phones rang all across this country policemen knocked on doors, telegrams came and the telegram said "the president of the united states orders you to report to camp kilmer" if in your opinion the east. >> rose: if you were a pilot? or a mechanic? >> a pilot, a mechanic, a weatherman, a navigator, a statistician. and in the end, of course, we could never get enough people. one of the secrets of the berlin airlift was because the planes were flying six and seven times what they were designed to fly, they were breaking down at a huge rate that in the end mechanics... we couldn't get enough were luft watch, we hired... >> luft watch. >> rose: i want to talk about the bigger names and all of the people who made huge sacrifices to make this happen. lucious clay. >> lucious clay was a great man who stopped the united states from... they was governor general of germany, military governor, he succeeded eisenhower. and his greatest contribution was in fighting the plans to turn germany into a pastoral country. henry morgenthau, the secretary of the treasury, wanted to return germany to the past, restrict its people to 1,500 calories a day so they could never rise up again. and it was lucious clay... >> rose: morgenthau wanted that? >> it was the morgenthau plan. we put it into effect. these guys, the daring young men i talk about, part of the orders were that they were to... the garbe cans and dumpsters outside mess halls, they were supposed to pour gasoline on them so that the germans couldn't eat them. instead these guys... >> rose: because the women were coming to scavenge looking for food. >> yeah. and when young corporals, young 19-year-olds found this out, they would load up trays of food and carry them out to nuns and to orphanages and to children because they didn't see nazis, they saw starving women and children living in caves in a city that smelled of death because under the rubble of berlin were rotting corpses. but clay was the one who thought the best chance of preventing a new war with the soviets was a strong germany industrialized as a buffer between east and west. >> rose: when truman made this decision did he think he might be risking world war iii? >> he knew he was risking world war iii. but the... clay particularly thought... clay wanted to send an armored column in, he wanted to fight. he wanted to fight because he thought the russians didn't want to fight. and i think truma.. i do know... i know truman thought that also. and in the end... >> rose: why didn't marshall think that, and why didn't loeft think that? >> they didn't think it could be don't. they thought the winter would come, it was the foggiest coldest winter. how could we possibly get planes in and out without revolutionizing aviation? lovett. well, as it turns out one of the side eects of the berlin airlift was revolutionized. >> rose: i want to talk about that. >> we were taking off and landing at three separate airports in berlin, a plane every 45 seconds. at that time, the most modern airports in america were laguardia and national in washington. in bad weather they had to have 20 minutes between landings. >> rose: who was general william tuner. >> general william tuner, willie the whip was... willie the whip who was an organizational genius who figured out how you could get these planes in every 90 seconds and get them out, get them maintained, keep the men who were sleeping... >> rose: come fly in, drop the supplies and fly out. >> and he he had done the hump, the flying of ammunition over the himalaya to the chinese nationalists fighting the japanese the the war. he was an organizational genius who found others. one of the stories of the berlin airlift was the people who put the airlift together under tuner also designed the systems that became kmart and wal-mart. the idea of getting something exactly where you needed when you needed. but they did it... they didn't have computers, they did it with teletypes and telephones. >> so twoor three months into it what were circumstances like on the ground in berlin? >> it was a circus. there were people sleeping in airports, sleeping in barns, being shaken awake to fly planes which weren't being maintained. one british flier... and the brits had a lot to do with this, said it was a loose collection of parts flying in loose... flying in formation. because the planes were being so overused. after those two or three months, the cowboy operation were literally... they'd run into the mess hall and say "we've got a plane ready" and everybody's run out, fly it to berlin. he... tuner came, organized that he was a very tough guy and also fired out the best... since they had no enemy except the weather the, he got squadrons and countries competing against each other to do more and ngor the point that they were able to bring in on the best day starting with 70 on the it is first day, 13,000 ton it is best day. >> rose: i was 11 years old when the airlift began, as thrilled by the actions as only a small boy could be. i thought i was on those planes far, far away riding to the rescue of innocent people, of course, berliners were not that innocent, but that just made the effort more heroic to an american kid, particularly one who wanted to be a pilot. >> that was me, obviously. and i thought they were heroes then and when i reunited with them-- and there are a lot of them around 50 years later-- they were everyone more admirable than i thought they were. >> rose: tell me tir stories. >> these guys had come back from the war... i mean, we forget how young they were. they would come back from the war and started new lives with new wives, new jobs, new schools. one of the fellows i focus son a guy named ed win gear who gets a phone call... he's just graduated from alfred university in new york he's going to new mexico law school. he gets a phone call 3:00 in the morning saying lieutenant gear... and nobody called him lieutenant gear for three years, he'd been a b-24 pilot. and lieutenant gear, you have to be in camp kilmer in 48 hours and leave your wife... his wife had become a school teacher in albuquerque. and she couldn't take that job. one of the big problems with the berlin airlift, these guys were called for temporary duty for 90 days, airline pilots. the airlines were shut way down to do this. many of them if they weren't with their wives at the time it happened, their wives dn't know where they were going, they didn't know where their wives were. the lost wives club as it was called, they had no power of attorney, no checks, no nothing, but they went and they did it. i don't know. i think that's what... i thought that's what americans were like. another guy my exact age could talk about what was what it was like opening the first packages that came on those planes, some of them were care packages. and he could remember every single thing that was in that package. the food that was sent that way was the food that had been warehoused for the invasion of japan. and that boy, the boy who told that story, was helmut kohl, who became the first chancellor of united germany. there's a lot of love and marriage and a lot of young germans my age ten, 11, who ended up americans.. ended up american air force officers usually because their mothers... germany was a country without men. the men were dead. the men who were left were old. and boys. so that you've got this lusty young group of americans and these man-starved young group of germans. had a lot to do with what our relationship is with germany today. >> rose: stalin counted oning? on the winter, called general winter. >> general winter defeated napoleon, defeated hitler when they tried to take russia. and so not for a minute did stalin think the americans would be able to... and the british would be able to figure out a way to fly through this. so he thought it was low risk. there was also another factor that did in stalin as opposed to a truman. that is no one would tell stalin the truth. fairly early on a lot of russian officers realized that the americans might be able to do this. and they also came to learn the hard way that east germany and east german industry and eastern european industry was often dependent on parts made in the west or materials in the west. so one of the reasons we won the airlift was that eastern european industry broke down without... the thing about communists is they don't understand capitalism. broke down without... because they couldn't get any supplies any more. >> rose: how did it end? >> it ended... stalin didn't give interviews, but he would occasionally... and reporters in thosdays would send written questions to the kremlin and one of them was kings bury smith, who was chief correspondent of the hearst newspapers and he sent five questions to stalin and stalin chose to answer those five. and one of the questions was about currency reform. it was currency reform, the fact that we wanted to put in a real currency backed by gold and the full faith and credit and that was the last thing the soviets wanted. they wanted economic chaos so they could take over these countries. and in the answers to smith, stalin never mentioned currency and dean acheson, who also had been against the airlift, noticed that. and then at the n. the u.s. ambassador phillip jessup approached the russian ambassador and asked "was that intentional?" he said "i don't know, i'll ask." and came back that stalin had intentionally not mentioned currency reform. so now there was no reason for the airlift. and also he realized west germany had been formed, we formed nato because of the airlift, it was formed during the airlift. that the las thing the russians wanted was a mutual defense pact between europe and the united states. but that was another fallout from the airlift. >> rose: it's what's called the hinge effect in history. >> yup. it was a hing of history. and that's why i was a little heartbroken that it seems to be forgotten. >> rose: so i want to come back to you and abu ghraib. but it was a time that made most everybody-- you were an 11-year-old kid-- proud of america. and it changed our image in the world or it added to our image and it made it... pick up on the story. >> well, did it change our image? it was what america... what people thought america was in those days and god knows what young americans... >> rose: it enhanced the image, right. >> there's a fellow named articlely nick swhon is the chief pilot of american airlines who was called back in. his salary went from $550 a month-- which was a lot of money in those days-- to $140 a month and he was captain of the air force against. he went to frankfurt, rhine main it was main u.s. base in west germany. and the first night he was there he went to a cafe off the base, it was filled with germans, he stood in the doorway and every german stood up and walked out, left their food. and these were hungry people. left their food there. two weeks into the airlift he came back to the same cafe, stepped in, every german stood up, went to the bar, got a stein of beer and lined them up on his table. and it was not only in germany that people were seeing america that way. i means this the way americans saw themselves in those days and frankly it's the way i'd like americans to see themselves again. >> rose: do you think they are? >> no, i think we've become smaller and petier and more divided and we've forgotten where we really came from. we came from lead big example. we weren't a rich country before world war ii. it was the war and the post-war years where we gave an example. we led by example. now we try to lead by strength. anthe idea of torture, of preemptive war, all of these things. these young men would have... that's what they associated with the enemy. that's what we were fighting against. and, yes, i would like to plant that idea in the heads of fellow americans. >> rose: but some people say around the world that one of the things that president obama has been able to do is to begin to change t image of america. >> i think he has beg to change america. >> rose: with speeches and... >> he's not wedded to the idea that everybody wants to be like us. they don't want to be like us. they want to have what we have. but still... i mean, i get around a lot, you get... i've... i literally am ripped up by the hatred for america that i see. >> rose: even today. >> even today around the world. and that's why i wanted to talk about these things. >> rose: i mean, even secretary gates has a comment in today's paper about europe and how he's disappointed in europe because they're not prepared to support america more in afghanistan and other places. >> well, i think we have to give them good reason to do it. and good reason is not imprisoning people and rendering them and torturing them. >> rose: your daughter works for president obama? >> she does. >> rose: in the white house? >> in the white house. >> rose: so you see him through a prism. >> i sure do. (laughs) i want to tell you this, in personnel matters the man can do no wrong. >> rose: (laughs) he's a hell of a judge of talent isn't he? >> he sure is. >> rose: (laughs) and this book is dedicated-- guess what-- to jeffrey reeves. >> my son. >> rose: how old is he? >> jeffrey is in his early 40s and is an actor, starving actor like most. but as you know, we've had some health problems in our family and my son jeff has just carried the family a way that you... makes you proud to be a father as well as an american. >> rose: how's your wife? >> she's bert but we she can't get around a lot. you and i both love to go to ris but she's getting stronger and she's got a strong will. >> rose: she's been living with cancer far while. >> seven years. >> rose: and this book... and you. so what's next? you went from nixon to kennedy to... >> i wish i knew. >> rose: you don't know. will will it decide for you orb... >> i'm searching like crazy. my editor, who you know, alice mayhew, wants me to write another adventure story like this. >> rose: this book is called "daring young men. the heroism and triumph of the berlin airlift." june, 1948, may, 1949. adds dick reeves said, it will make you proud of your country, it will make you proud of the people who put their lives on the line by interrupting their lives and then going and being part of a heroic and triumphant moment in history. our thanks to dick reeves and our best wishes to kathy. see you soon. >> see you soon. as soon as i get another idea for a book. >> rose: (laughs) we'll do our best. if you have an idea, mr. reeves... >> please e-mail it. >> rose: let him know. he needs to put food on the table. (laughs) >> that's exactly right. >> rose: thank you for joining us. we'll see u next time. captioning sponsored by rose communications captioned by media access group at wgbh access.wgbh.org ♪ ♪ if you've had a coke in the last 20 years, ( screams ) you've had a hand in giving college scholarships... and support to thousands of our nation's... most promising students. ♪ ( coca-cola 5-note mnemonic )