i like to close to facts. i think they are facts. as you a question based upon something. a biblical fact, number one, judas did not trick the arabs out of the middle east. king saul, david, solomon greuel their 3,000 years. jumping at, u.n. resolution 242 gives israel the right that exists. palestinians and other countries , institutions want to join the un. this is a fact of un policy. why don't these two, given all the other arguments in between, carry more weight in resolving this whole issue? as i said, perhaps incredibly naive. >> enter the jews. i think you make a mistake if you refuse to -- the degree to which and the muslim world, in europe, one of the reasons that people don't accept this outcome is they don't like the idea. they don't want to except. that as been demonized really almost since the day it was created. that is a factor. downplay it. second, you go back to this tree of this, there was of you right at the beginning. we don't need to accept this. everyone except us. that is not the case. that is why the resolution passed. the united states recognizes. they tried to us killick in the grill. it's not a federal penalty in 1949 and 50. as we saw in 7073, some of those cases there were a bit too close for comfort and were in some of those cases you could say only some kind of outside intervention saved the state. it may have been check weapons. americans had another point. i think for a policy standpoint and for people who hated the ally, alas, during the cold war. the continuing belief the continuing disposition. and this could be turned around. it may take awhile, but it may be takes another 65 years. does the reference. so i think that the differences for so many people it is still not complete, and that is why that is why i think you cannot possibly ever exaggerates the importance of the closest possible most visible ties with the united states. this is a country surrounded by enemies with hundreds of millions of people around the world who wish to eliminate the country. of course the iranian said to do it more quickly. others want to do it or willing to do more slowly. we do not accept the permanence of this. the permanences is actually debated. one of the things that really changes that argument is then the world's greatest power repeatedly in words and action say this will never happen. this fantastic president, the addition 307 million people in the united states. that is the kind of rhetoric and action that we really need to combat this terrible elimination this threat that only then the entire world will be saved. thank you. [applause] >> we would like to hear from you. tweet us your feedback. facebook.com/booktv. >> you're watching book tv. now peter blair henry argues that the u.s. should look to a china, brazil, mexico, and other developing countries to develop its own plan for prosperity. this is about 50 minutes. >> growing up as a little boy on the island of jamaica in the early 1970's i cherish the time i spent on the porch of my grandmother simple two-bedroom ranch house in kingston, the nation's capital. there number three when the way in harbor view and middle and working-class neighborhood at the southern edge of the city i would sit on the brown speckled tile leafing through the pages of encyclopedia britannica reading bible stories and poring over back issues of national geographic for hours on end. the needles that line the front yard and shaded by world from both the son and the gazes of people passing by on the sidewalk sense from grandma's kitchen. breaking bread, brown sugar and land use wafting through the air they'll get better as the day progressed and the sun made its arc to the expense. the approach of the evening is always my favorite stretch of time. about compositor needed day in the fall of darkness. grandma finished with the housework, come outside and sit with me in the early evening here encouraging children to read and dream, grandma, a former schoolteacher did best. she never missed an opportunity to work with one of our favor students sitting together in the fading light. we lost our cells in conversation. a company by the pulse of chirping crickets -- credit crickets in beads from the nearby room shop in the animated voices of young men playing soccer in the streets. these are the sounds of the caribbean. the lyrical backdrop to grandma's outdoor classroom. i asked question after question about the people and places i had encountered in the days reading and my ever patient teachers shared with me facts and figures about distant lands. the greatest lesson i learned from my grandmother came not from something she read to me but from something she did to someone else. in jamaica party is never far away. give way to the pearson call for women at the front gate. this is henry. this is henry. we beg you, and. when poverty calls to you from the front gate you have to make a choice. you can avert your eyes, perhaps even turn your back and harden your resolve not to engage, but poverty would still be there looking to you, even if you don't have the courage to return its case. syncom, grandma called out, she mentioned her tiny, the haunch train from the chair next to me, walked across the tiles, stepped from ports to carport and made the 30-foot journey to the gate. good evening. how are you. her appearance belied her reply. all right so far. looked anything but all right to me. as i want to follow grandma toward the porch. the closer she came to my sick classroom, the sharper the contrast i discern between her and my beloved tudor. with their feet, tattered clothes, nodded there and a protruding belly seemingly at odds with their thin frame this month appeared to be from an entirely different time and my grandmother with repressed and starched cotton dress and neatly groomed appearance was the quintessential schoolteacher and matriarch of the church. they asked if she was hungry. she replied, yes. a long time we not eat. my grandmother disappeared inside and emerged a few minutes later with a large tumbler of milk and a plate of warm heart-dough bread it dripping with butter. i sat their watching this moment eat and listening to the exchange. my grandmother asking questions in the queen's english. ms. mahler responding in padua. the continued out for some time. ms. mama chronicling her tough circumstances. my grandmother suffered worth of comfort and encouragement. until the last crumbs disappeared from the plate, the milk was drained, and my grandmother sent miss mom on their way with a familiar jamaican benediction. well, good. i don't know how she got her name. and i don't know where she came from, but i can't picture her today just as i saw her in that first encounter in late 1977 when i was a years old. over the next several months she appeared at my grandmother's front gate with increasing frequency. one day in 1978 following what turned out to be the last time i saw our, i asked my grandmother, grandma, ms. mama has a big belly. why is she always hungry? my grandmother replied that some people have big bellies, not from eating too much, but because they never get enough to eat. for me economics is all about this mama. i was drawn to the subject because i wanted to help people in developing countries, native jamaica help themselves. feeding the hungry is an act of kindness. providing that i agree with the means to feed themselves is an act of empowerment that confers dignity as well as nourishment. my grandmother was too old and lack the technical trading -- training to give people like ms. mama that kind of enabling assistance. i wrote this book because i have no such excuse. helping people to help themselves begins with a simple observation. never in the history of the world has a country substantially reduced poverty without significantly increasing its populations average overall standard of living. they canes for economic expansion may not be evenly distributed, so growth alone is not a sufficient condition for development. it is absolutely necessary. correct -- light becomes a series of zero some troubles directed at limiting one's share of resources with growth, the pie expands and the politics of distribution no longer involve such start trade-offs. because economic expansion provides the most reliable means of enabling the poor to lift themselves out of poverty. the critical question is, what kinds of economic policies were the foundation for growth. economic policy decisions implemented in the months and years ahead will determine whether people eat or starve, live or die and not just in the emerging economies. the financial crisis of 2008-9 drew record numbers of people in the united states, unemployment, foreclosure, and poverty to say nothing of the devastating impact on the after shocks of the economies and peoples of europe, whether in the first world or the third, there is no place to hide it from the power of policy. also no place for you to hide. [laughter] come out to hear talk about a book on economic policy. you have great courage. but as you can tell from that reading, this book is as much about humanity and relationships as it is about economic policy. and what i would like to do with my remaining time before we open it up for question and answer is just give you a sense of what our release of critical issues. the last paragraph, what are really critical moment in the economy. growth is slow in the events economies. less than 3% last year. europe is in recession. emerging economies are for the first time driving economic recovery. the question is how will we create a more prosperous future? and really in a nutshell the book is about three things that can allow us all to have a more prosperous future. and what we in the first world can learn from the history of the developing world to help us attain a more prosperous future. and so those three things. those three things are disciplined, clarity, and trust. that is what i would like to do, give you some stories if i may from the buck to illustrate the power of those three. so disciplined, this one is not what you think it means in the context of policy. discipline does not mean fiscal austerity, nor does it mean wasteful spending. to put it in terms of eating habits this one is not crash diving and been cheating or sherry service. this is about finding a path to prosperity. so discipline means a sustained commitment that is both vigilant, flexible, and very important and but what is good for the country as a whole over what is good for the individual, interest groups or persons running for political office. in the context of fiscal policy which is appropriate to talk about given the current discussions around the world, but the united states and europe, fiscal policy, this is no more complicated than a simple story that everyone already knows, the story of the hand and the grasshopper. the and saved sometimes the flesh so that it has something to eat when times are hard. the grasshopper partied and was really hungry when times are lean. who is the end and who is the grasshopper? one point in time the first world went around the third world lecturing about how we live and like, but in 2001 in this country we have a record $236 billion fiscal surplus which we decided, again, during feinstein's we would return to the people tax cuts. during 2002-7, during record time of global growth and not just the united states, fiscal deficits. about 3% of gdp. became more indebted. third world countries who use discipline to turn themselves around. the fiscal surpluses during that time. the country in particular, the story that really resonates. in 2008, again coming out of this record time of global growth between 2002 and 2007 experienced a boom due to a developing commodity prices, copper and particular. there is enormous pressure on the is trillion finance minister to spend the surplus to give it back to the people. he resisted that pressure. said no, this money is for rainy day. did not use his exact words, but that is what he said. of course read a financial crisis. in the deaths of the financial crisis in chile had socked away billions of dollars that allowed it to then enter a $4 billion tax cut to stimulate the economy to provide for a buffer exactly as we learned economics 101 called countercyclical fiscal policy. no more complicated than the story of the internet grasshopper. third world dance, first world grasshoppers. that's discipline. clarity. for clarity i want to tell you the story of another caribbean island, not jamaica, but the tiny island in barbados. in 1992 barbados' faced an enormous financial crisis, a potential financial crisis. about to add a foreign exchange. the u.s. economy was in recession. the economy dependent. the exports. barbados was in real trouble. and barbados received a visit from the international monetary fund, the imf. barbados at that point in time also had what is called a fixed exchange rate, much like the countries in the eurozone. a certain value. in this case just over one-half billion dollars. the imf says your country has become very uncompetitive in the same way that country's in much of europe had become uncompetitive. rages -- wages have risen more quickly to much faster than productivity. cost has risen. what is the deal? they said, well, we think you should devalue your currency which would make your exports cheaper and imports more expensive which will allow your economy to readjust and making more competitive. the said we don't think so we don't like the idea of cutting wages without the people's consent which, in fact, is what a devaluation is because you move from 17 to two u.s. dollars and the prime minister was concerned and said we want to convene a discussion. we want to bring together the private sector, the unions, and the government. we want to talk about this problem. and over the course of the next several months there was a very heated discussion. the alternatives were laid out. the brady and said we have a choice. we can either do with the imf says and devalue the currency or beacon cut wages. we have to do something. ultimately the discussions got to a very difficult place. the government consulted with the private sector and the unions. it was agreed that there would be an 9% wage cut. 9 percent wage cut. people were very unhappy and took to the streets. roughly 30,000 people took to the streets. barbados was roughly eight in the population. that is the equivalent of 40 million people marching on washington to protest a wage cuts. somehow the center held. the leader of the trade units said we have to do this to save the country. the three parties work together, the wage cut held, and the economy of barbados recover quite quickly. before those efforts the prime minister and his party were kicked out of power for 14 years . the economy recovered after word . summarily dismissed from office. when asked in retrospect would he do it again, the prime minister or foreign prime minister said the price i paid was a small price to save the country. clarity. clarity matters. what can you possibly take and my answer to that is it is not so easy to do things in a small country. the person his wages get cut is not anonymous. a cut in wages affects your brother, your cousin, possibly even your mother and father. so if a tiny country, a close-knit society can find a way to make difficult decisions, to find a way to make its economy more competitive, not through austerity, but through reform and by the way, part of the story and left out, the private sector agree to open its books and agree that in the future there would be rate increases. in other words, the benefits would be shared amongst workers and the company's, a social compact, compromise, clarity about what needed to be done. the third key lesson from emerging economies about what needs to happen to have a more prosperous future is to discipline, clarity, trust. i mentioned the imf. let's go to emerging economies as a larger group and less talk about the so-called gross, brazil, russia, china, south africa, the large emerging economies. the bricks, the so-called brakes now account for 21%. and yet of the international monetary fund and the world bank to of the world's most robust economic and financial institutions were setting the international policy agenda that together the united states treasury plays a major role in the 70's and 80's, and 90's and teaching, again, what they needed to do to turn around the economy's and become emerging markets. at these institutions the brakes only have 11 and and a half percent of the voting shares despite the 21% population approval in the economy. the contrast, the countries of the eurozone area account for about 25 percent of what was gdp that is 32 percent of the votes. why is it a trust issue? well, in order for emerging economies to continue to grow, to continue to be our economic indulgence will they do so? will they continue to do so? will the political leaders have the capitol that they need to sell tough, clear decisions to the electorate if there is no reciprocation? and give you another example. at the onset of the financial crisis the advanced countries in particular made a pledge to be committed to continue free trade , open markets. between november 2008 and november 2010 we know that more than 800 instances the protect those measures during those times. more than 40 percent of those were implemented by former g-7 countries. so as much talk as there is right now about fiscal deficits, when we look at the world economy and, the trust deficits is, perhaps, our largest impediment to future growth. we need to build trust. and the unwillingness of first world countries to reciprocate and recognize the new stature, the gains that some of the third world is made, taking a lonrho to prosperity undermines our chances for a shared future prosperity. .. >> the future lies in the catholic church in the emerging world, but as a goes in the catholic church, so to in economics. will the first word be able to summon the discipline, the clarity, and let me add the humility to regain or gape the trust of the emerging world so we can all share a more prosperous future? i'm hopeful. happy to answer any questions you may have. [applause] >> if there are questions, we ask you go to the microphone, thank you. >> i'll take it up. >> okay. >> how can you have the first two, the disblip and the clarity, when you lack the trust and the example i use would be our relationship with china. we don't trust them to keep to a lot of the currency. we don't trust them to properly regulate ip. you know, we think they are stealing all of our stuff. how do we maintain, you know, solid discipline free trade relations, support their growth, support our growth when we just don't trust them? >> right. it's a great question. as i think about it, and i can't help myself because, you know, i have a loose math here tonight, but just clarity equals trust. use the example of free trade. let's take that example. discipline in the cop text of -- context of free trade means we need both imports and exports to profit. the media and the popular press talk about the importance of having a trade surplus thinking exports ared good, imports are bad, but the real benefits from exports, what you have to do -- export in order to earn roirses needed to pay for imports. free trade is good because it aloes countries to specialize in what they do best, most efficiently, so we use the resources well. discipline in the context of free trade means we recognize we need both imports and exports, and the example to south korea is a great example you don't need to run trade surpluses in order to prosper, and south korea from 1995-1990 during its period of extraordinarily rapid growth, 7% per year, per capita terms. south korea grows three times as fast than the united states grew in the g