Transcripts For CSPAN2 Book TV 20130527

several months ago -- >> yeah. >> it's just too perfect. it's just too perfect. >> i remember -- [inaudible] he knows what he's talking about. >> plus i've got a -- you'd attract a lot of people. the interesting thing is we had to get on the poster your title for the kids. >> i know, i know. this is what we were talking about, there's no memory of pre-1990, you know? and i was doing the c-span thing, you know, with brian lamb, interspersed with all this footage from 1981, '82, and they're going to say, well, who's this guy being interviewed? i had all my hair then -- [laughter] >> i, actually, i was on c-span sunday morning and talked about the book a little bit. >> were you? >> yeah. i see every now and then you do a lot -- >> i do a lot of bloomberg. >> yeah. and i think haven't i seen you on msnbc? cnbc. >> this week i was on -- [inaudible] monday morning, and they didn't even stop me, they just let me fly. and they had me come in on, you know, they had that walk-in thing where you sit down with and all those, and internship playing the -- and they were playing the theme song from the -- what was the, apocalypse now. [laughter] >> that was great. >> yeah, yeah. >> yeah, please, this is -- [inaudible] from bloomberg. >> hi there, how are you? >> i'm diane -- [inaudible] >> oh, good. [inaudible conversations] >> concord. >> yeah. okay. um, and sheila bair, isn't she involved with them? >> she's two doors down from me. >> okay. well, say hello to her. you have to look at my book, because she's one of the 20 heroes in the book. >> with i heard about that. i have to tell you, i read your first book when i was much younger, but it influenced me quite a bit -- [inaudible conversations] >> yeah, you have. concord coalition. >> and i'm -- >> really, oh, you're at cbo? so you're a budget lifer is what you are. >> yeah. >> okay. well, good for you. >> the author of the economist mom blog that you may have -- >> i put you up there a couple times on my blog. >> oh, you did? many well, i'll look for it and get it up on my list. >> okay. >> it's sort of static now -- >> you don't have a -- oh, is that right? >> yeah. >> and you, you're not in the budget business? >> oh, no. brookings. >> oh, you are? what is your field? >> [inaudible] >> oh, really. okay. so this is like a family affair. >> yes, yes. >> i've done a lot of work with alan auerbach. >> i'm really on the warpath because i think they use a model which is obsolete. it's kind of a keynesian full employment where below it we assume the economy springs back in four years, that's what cbo is now 14-17. we get to full employment, and we stay on the path of potential gdp forever. now, it hasn't happened in the last 15 years. >> right. >> why are we using models that way overproject the economy and result in a, you know, a projection that is far lower than it really is? what i did the other day was i took the last ten years, and i said cut and paste. we estimate the budget with the same economics as the last ten years -- >> oh. >> -- because i don't see any reason why it's going to get any better. >> yeah. >> it may get worse. >> yeah. >> the investment's -- [inaudible] not trying to make it worse, i'm just trying to pick it true. >> right. the wars and recessions take effect on -- >> yeah. but we're going to have another recession. >> right, of course. >> that's right. this budget, you know, these projections assume 14 years with no recession. >> yeah. >> which hasn't happened in human history, okay? >> yeah. we sort of have this rule of thumb fiscal policy that if we can get deficits down below 3% of gdp, it'll be okay -- >> well, who invented that? >> right. we think that the economy's going to grow at 3% on average, but it may not. >> it never has. >> yeah. >> it's grown at 1.7% real compound since the first quarter of 2000 through the last quarter of 2012. that's not a cycle, that's a trend, okay? >> yeah. >> and if you projected gdp at 1.7 real and 3.9 nominal -- >> right, right. >> this is what we also had in the last 12 years. >> yeah. >> pretty ugly. >> yep. >> anyway -- >> thank you. >> go renew. great, good to see you. >> i'm josh. i saw you yesterday. >> i thought so. >> i met you a zillion years ago through our mutual friend judy miller. i read the op-ed, and i thought, oh, my god, he's off the deep end. [laughter] even though as you can tell i disagree -- you're still here. >> it's a new take, okay? it's a retake, a revisionist take. it's an attempt to debunk a lot of mythology in the public dialogue things about the republican era that republicans believe as a matter of course are pure myth. things about the new deal including the fact that in 1937 there was a recession because they tried to balance the budget, that's not true. not even remotely true. what happened was, i don't know if we got into this yesterday, there was an accidental massive stimulus when the bonus payment was made in the summer of 1936 for the world war i -- >> right, of course. okay, right. >> and they didn't realize, they gave them bonds, and they didn't realize all the veterans, and there were three million who received them, were so desperate they'd cash in their bonds immediately. they thought they'd be cashed in over ten years, so it was a $1 trillion stimulus in today's dollars. >> right. >> all of a sudden the sales took off, inventories were filled, industrial production took off, employment, and then the veterans spent their last dollar, and the bonus was gone, the shelves didn't move, and it ended. and that had nothing to do with the treasury i secretary, you know, roosevelt's treasury secretary worried about the deficit. >> why do you think -- when i asked you yesterday about, okay, fine be, you said -- [inaudible] you said it'll be constrained to wall street. i wouldn't cry about that a. but my sense was that there was enough mortgage-backed, etc., in the -- >> no, there weren't. you've got to read my book because i show in the entire mainstream commercial banking system including the $11 trillion asset balance sheet -- >> right. >> there was 100 billion only of securitized mortgage debt. only 100 billion. which is nothing, you know? it's like a tenth of a percent. >> [inaudible] >> yeah. now, because it would have been written, you know, they wouldn't have had a panic dumping of those few securities. >> in that case what my reaction would be is maybe with the benefit of information, thought and calm -- >> yeah. >> i am more sympathetic even though i'm not a fan. paul krugman because they weren't -- >> they were panicked. the fact that -- [inaudible] [inaudible conversations] they could have looked into it. they could have realized that all the securitized, toxic garbage, all the reallies of it, was either on the inventory shelves -- >> you don't think that after lehman they just freaked out? >> well, they should have -- they shouldn't have, but i call it the blackberry panic. >> right. >> they freaked out, the institutions they knew and loved like goldman and mo began stanley -- morgan stanley were going down, and there was no run on retail banks. anyway -- >> if it had been -- if they had known that, they probably still would have done the same thing. but it would have been -- >> no, paulson was bad. paulson was bad. >> okay. i think of him as well meaning. >> yeah. but he was in the wrong job. he was an m&a -- >> right, right. >> and you know what m&a guys are like, right? >> yes. >> okay. i was one too. >> yes, i know. yes, right. >> moving around the world doing deals, and he didn't understand it's not the job of the treasury secretary to do deals. >> right. >> and he got himself all hot and bothered and lathered and sweaty, and all of a sudden he, basically, thought he was running the world. he did. and bush had no clue, and they were -- treasury took over. i call it an internal coup d'etat because congress was totally buffaloed they were scared to death, bernanke runs around talking about the great recession which is a lot of bs, never anywhere close to a great recession for structural reasons that i lay out. >> you've got me talked into reading the book for -- >> [inaudible conversations] >> yes, yes. >> but chapter 31 called "bernanke's false depression call." and i think i laid out pretty well the difference between 1930 which was night and day from today. massive exporter, creditor and our industrial economy tanked when all our customers around the world disappeared. >> right. >> this time it was china that was the massive -- >> yes. >> and they tanked. the hoovervilles were in schezwan province. >> that's true. >> here we were basically a huge importer, debtor, consumer economy, and after a slight downward shift, you know, millions of jobs which wasn't good, it bottomed. it bottomed before any of the stimulus, it bottomed in june '09 before -- [inaudible] [inaudible conversations] >> all right. >> hey there, how are you? -- [inaudible] >> yes, yes. now, where are you from again? >> minnesota. >> all right. >> i'm -- finish so i was treasurer -- >> one of the only financially literate congressmen we've had. >> we need more. >> how long were you there? >> six years. three terms, 2001-2007. >> okay. and -- >> what was their area? >> you mean specialty? or committees? >> yeah. >> i was on transportation -- [inaudible] >> you know, when i first started in congress, i was on the commerce committee. now it's called commerce and energy, and that was the late '70s when we were having all these battles over jimmy carter's energy program. so it was a pretty interesting -- >> i have not had the graduate school of management at -- i now head the graduate school at george washington, and i -- [inaudible] economics in minnesota. you're going around the country looking for places to speak? >> yeah. i'm going to be in minnesota. do you know former senator david -- [inaudible] >> i do. >> he invited me to speak for some organization around minneapolis somewhere. i think it's in late april. >> late april? >> yeah. >> this year? >> yeah. >> i think it's like 25th or 6th. >> treat. >> so -- >> well, we'll talk to dave and see if we can get a few people there. >> yeah, okay. that would be great if you'd do that. >> good. thanks so much. >> thank you. >> thank you, everybody. before i introduce david, a couple -- i need to brag for a second. you see the bottom of the letter next to the two awards? [laughter] a couple of weeks ago, qorvis got its latest awards for a commercial we did for am coe. you may have seen one where the car's going like that? that was us. and two people who did it -- cassie, where are you? >> i'm right here. >> cast -- cassie and -- [inaudible] were the two people responsible for that. not a shameless promotion at all. [laughter] couple of quick things. if you're trying to get on, we set up a special wireless for everybody, if you'd like to live tweet while this is gown on, the hash tag is q book party, and we'd love to have you follow us. but the live tweets are all going to be on the tv in the conference room there where david will be signing books in a minute. all right, let me introduce david. what i'm about to do is two quick very true stories. 27 years ago i was coming back from a trip to hawaii. now, as glamorous as that sounds, i was actually there doing briefings on the graham-rudman-hollings law. it was three-hour briefings. i was coming back the day this book was published, "the triumph of politics." it wasn't available in the bookstore in honolulu, so when we got off in l.a., i ran to the bookstore in the airport, got a copy of it, read it. this is that same edition. it's still got all my underlinings, and today, 27 years later, david corrected a huge miscarriage of justice, he signed it for me. [laughter] so thank you for that. all right, now, the other quick story. i was mentioning this to david before we began this evening. i have vivid memories of him testifying up on capitol hill about military pensions. he said something to the effect of how he was outraged that it was a, you know, just a terrible thing that the generals were more interested in this their pensions than they were in defending the country. i say this today because yesterday, almost three decades later, the current secretary of defense, chuck hagel, said almost exactly the same thing talking about pensions, military benefits, those types of things. and everything had to be on the table. in other words, david stockman was clearly a man ahead of his time. in fact, when you think about the fact that chuck hagel said that yesterday, you'd think we arranged it almost. i'm not going to tell you we didn't, but in any case -- [laughter] i should also mention that secretary hagel used much milder language than david did when he was testifying. that's not surprising if you've read the book or the excerpts or anything that appeared in the "new york times." you know that he said some things directly, you know, and unambiguously. which brings us to david's latest book, "the great deformation." actually, it's not a book, it's an indictment. and that's a word i'm using very intentionally. who's being indicted? well, in no particular order, wall street, corporate america, republicans, democrats, and you have a particular thing for the federal reserve. >> that's right. >> i'm not going to repeat what you said about william miller, but you also went after arthur burns, alan greenspan, ben bernanke and almost anyone who might have passed by the building. what david said 27 years ago in this book, if those of you who remember or read about it or googled in preparation for this today, you know what he said there created all kinds of waves. given the people he has indicted in this book, i have no doubt that the waves are going to be crashing again from every possible direction. rather than me telling you any more, please welcome david stockman. [applause] >> ben, this is yours, right? i would invite you to move in closer, but i want to warn you, i'm wired. and i know in washington to get near someone who's wearing a wire is probably not a healthy thing to do. but i want to say just a few things, and then hopefully take a bunch of questions, and i'm happy to sign the book and so forth. but i have to start by confessing that i'm really gratified that all of you came to a book party when i'm not even a real author. according to some, i actually do rants and screams and, you know, i'm a cranky old man who got lost somewhere in 700 pages of error, at least according to professor krugman. and so i am politically incorrect, but i have to say that when i did the times piece on sunday and then the reaction came immediately not only from him, but many of his fellow travelers, all of a sudden the book took off. i was amazed. i mean, a 700-page book, and it's got a lot of great history and so forth in it. i'm not stepping on my own book, but normally you wouldn't think that would go right up to number five on the amazon list in one day, the first day it's out. and this is not to brag because i want to point out what's ahead of me. there are two diet books in front of me, and there's one book called "the walking dead" which is a novel -- a horror story. so what i'm thinking is, this really is a diet book about the national diet bigtime, massive that we're going to have to have over the next decade or longer if there's any hope whatsoever, and i don't give it much chance of getting our massive fiscal imbalance under control and reeling in what i call the rogue central bank, this serial bubble machine at the fed that has really done an enormous amount of damage and continues to do so. so what i thought wild do here -- i would do here because you can't possibly get into all the details with all of you standing and waiting is that i would give, like, four or five very provocative sound bites, be happy to answer any questions that try to, that may result from anyone who's not quite convinced because i'm not going to provide any evidence, i'm just going to say it -- [laughter] and then if you're still not convinced, i'm going to invite you to buy the book because it's all there, and you will, hopefully, be convinced at the end. so here we are, this is why i think we're heading into sundown in america. i think we have underway a massive failure of the machinery of government. and i think that's a little ironic because the dialogue, the public dialogue for decades in america has been about the failures of the private economy, about the imperfections of capitalism and about the need to pile on government one responsibility after another through the arm of the federal reserve, the central bank or through the fiscal authorities or true the tax code -- or through the tax code or through the entitlements to fix so many problems i don't even want to list them today. but you're fully familiar with them. even out the business cycle. take care of, you know, dislocations between regions. fix up the cities. have a social safety net for 50, 60, 70 million people. end poverty. um, you know, massively subsidize the medical care system and so forth. all of these things have come crashing down on the arms of government and have paralyzed it. it's got too many responsibilities, the costs are the too great, the inability of our democratic system to deal with it is now transparent because what the proponents of big government -- and they were both republicans and democrats. remember, when republicans went for tax cutting anytime, anywhere for any purpose, they essentially turned the irs and the revenue code into another arm of big government to make this happen, you know, in the energy sector or something else happen in housing or something else happen in the financial industry and on and on i could go. so we ended up with a massive government which is a jobs machine in the eyes of everybody. the democrats on the spending programs, the republicans on the tax side. we end up getting revenue depleted down to 15%, we end up with spending being ballooned up to 24% and then both parties paralyzed on either side of this enormous gap in between. in a democracy if you don't have a conservative party willing to defend the gates of the treasury and pay the government's bills if it can't cut spending which my book shows we did pre-1980, that's what eisenhower did, that's why he's one to have the great heroes, you end up with two free lunch parties competing for the affections not only of the electorate, but the affections of the whole money-raising political action committee, special interest group process that i think now totally dominates the system. so the first thing then is the budget has become a doomsday pa chien. the deficit -- machine. the deficit problem is far more structural, far more permanent, much bigger than anybody imagines, far bigger than the seven million that cbo's projecting for ten years. it's not on a glide path down, it's on a banana peel, and it's going to go up if you use honest economics. honest economics, and here's a simple way to explain it, do a cut and paste job on the last ten years in terms of the unemployment rate, the gdp growth rate, interest rates, a few other things that drive the budget. project forward for ten years, and you are get 15-20 trillion of deficits, not seven. and that gap so huge that there's no way the politicians will ever be able to deal with it because any pain that they're talking about today which is minor is a rounding error in closing the gap. one example, the idea that we should change the cost of living adjustment and make it a chained cpi is a good idea, but it's only 1 or 2% of the real gap that's out there. when they begin to realize how permanent this is, every time the budget -- debt ceiling expires which is going to happen month after month, year after year, we're going to be paralyzed fiscally, that's going to spill over in the economy, that is going to fundamentally undermine confidence, and i'm not trying to paint a story of doom or gloom which it is, i'm trying to get the honest truth out about in this budget doomsday machine. second is the fed is a serial bubble maker. their bubble machine. they're doing untested theories that would have been considered wacky as recently as 1990 by any, you know, 99 out of 100 economists that you might have taken a poll among. they are expanding the balance sheet of the fed so fast, they are so deeply involved in all the financial markets that interest rates have been destroyed. wall street today is nothing but a casino that is front running and trading what the fed may do and, therefore, the bond market is the greatest bubble that has ever been created, and when it explodes, a huge problem will happen. the political parties have failed. i say in my book that, basically, they have become glorified concierges whose job is to introduce politicians to money. and the political action committees and other, the other mechanisms of getting reelected. the parties stand for nothing, or if they do have words if their platform, they betray it the first time they get a chance. look at what the republicans did, and this is my fourth point. rampant crony capitalism is now -- has now captured the machinery of government. the republicans bailed out wall street in 2008. i've got a whole section on what i call the blackberry panic that demonstrates there was not a great depression 2.0 coming down the pike. it was the wmd of economics, and that means it wasn't real, it wasn't plausible, it wasn't going to happen. but it was a cover story for going into wall street, bailing out goldman sachs, bailing out morgan stanley. i demonstrate that aig was not a contagious disease, it wouldn't have spread to the whole economy. there never was going to be atms go dark, there wasn't going to be payrolls that couldn't be paid. all of this was urban legends created in a few days to allow all of the, basically, the goldman sachs' occupation of the treasury building dive into wall street with t.a.r.p., the fed to dive in with massively liquidity injections in order to bail out the last few investment banks standing which were really big gambling casinos and glorified hedge funds that should have gone down that wouldn't have done great harm in the long run to our economy. so that's the fourth thing you'll see, and there are many other propositions in the book that's mild compared to some other propositions in the book. so you can see we cover a pretty extensive terrain. there's a lot of analysis and data that supports some of these things, but i hope that gives you some flavor for it, and i'm sure there's one or two people not convinced. so i'd be happy to take questions. thank you. [applause] >> we're going to take three quick questions because david's got to sign some books for people. >> over here. >> looking forward not back as it relates to the fed, do you have any ideas, david, about restructuring the fed? do you think it's the fault really of the debt members who are too tied to wall street? if you have a kind of correction for the fed going forward, what's your idea? >> yeah, i do. very simple. go back to the original design for the fed in 1914 when it opened. the design was created by carter glass who was chairman of the house banking committee that created it. a lot of you are familiar with glass from glass-steagall. he was one of the greatest mob tear and -- monetary and financial thinkers ever to be actually elected to office in the united states. he was secretary of the treasury for wilson and so forth, and he basically said the job of the fed is to run a passive discount window where banks can come with their collateral, get cash at a penalty rate of interest, the badget thing that some of you may be familiar with. but it would not own any government debt, it would not intervene intentionally or proactively in the financial markets. it would never be in wall street and, therefore, it wouldn't become a national monetary planning agency and end up with 12 people trying to run the world. the other conception was milton friedman's, and so i think the great debate of the 20th century was not high yak versus keynes, it was really friedman versus glass. friedman was wrong, glass was right. friedman was supposedly a great free market guy, but he created this monster of the discretionary federal reserve intervening in the debt market and buying up the government debt. now, of course, he was a conservative. so he said only put monetary units on the fed who will sit around most of the day, you know, reading book reviews, not doing anything and every now and then change the dial so the money supply grows at 3%. but he never explained how the political process was going to deliver up monetary units that would have that kind of discipline. what we've had instead is people interested in power, people interested in running, you know, the economy and the world and finding excuses to do it being appointed to the fed, and we've turned it into a massive agency of, you know, substantial economic destruction and dislocation. >> in 2008 i think most of us can remember there was a real sense of panic, both potential panic. how would you have carried forward during that moment? just put a couple more places for sale? is. >> yes. yeah, it's a great question. but i would have done the teddy roosevelt thing. during the panic of 1907 which was every bit as dire as this, trust banks were failing and even a commercial banks were failing, we didn't have a fed. teddy roosevelt was president. he was down in louisiana bear hunting. he got a message that there was a crisis on wall street. he said, i don't care, i'm going to continue hunting my bear. he stayed in the wamps of, you know, louisiana for the next ten days. by the time he got back, wall street had taken care of its own. jpmorgan said anybody that's insolvent, you're gone. we'll make a loan from the clearinghouse banks. not the fed, not taxpayers' money, our money, the syndicate of banks, and the next thing when you open, the solvent banks and, you know, they carried a lot of them out on a stretcher because they were insolvent, but the solvent banks, when you open tomorrow morning with our money that now is at risk, the 24 banks in the group, all you officers, you're gone. you screwed up, you put the bank in this situation, you are gone. you're out the door. a new team is coming in tomorrow morning literally. he then said the board of directors who are supervising you have failed. they're out. they replaced the whole board of directors. that's how a real financial crisis is involved. if you let the market system work. now, i might point out that during the four or five days of that panic which i compare, you know, the panic of 1907 to the blackberry panic that bernanke and paulson and all these people running around during that panic there was no federal reserve. nevertheless, they got it under control. the economy suffered for a couple of years, but it worked its way out. and an indication to me that the mechanism that's missing today is interest rates. on many days, this'll be unbelievable. bernanke couldn't even imagine this. on some days the interest rate went up 10%, the call money rate in one day. it peaked at 80% and, therefore, all the speculators who had borrowed a lot of money on margin to buy stocks or, you know, buy some real estate, they were wiped out. and for the next generation, nobody did it again until 1929, and then they got wiped out, and for 40 years it didn't happen again. so i think we're really off the deep end. we have a fed that's owned lock, stock and barrel by wall street. it is, basically, coddling wall street. it's not helping the main street economy. it's crushing savers in america. how can anybody save money if you're getting 50 basis points or half a percent? so that's why i say it's sundown in america. our machinery of government has gone off the deep end and is doing things that are harmful to any kind of orderly and healthy recovery not only of our economy, but of our political system as well. >> mr. stockman? >> yes. >> i remember getting a 19% mortgage at one time. but my question is, when will we see the turn? in other words, we know the federal reserve's buying about $4 billion of securities a day to keep this all going. what are the first symptoms we'll see when they start to pull back on that buy? >> the problem is they've taken themselves hostage, as i said in my new york times piece sunday, they're in a monetary prison of their own making. because now there are literally hundreds of billions of treasury bonds owned by speculators and fast money traders who then buy the bond and borrow 98 cents on the dollar in the repo market. they're paying ten cents, you know, ten basis points to borrow. they're earning 180 points on the bond. they're pocketing the spread, laughing all the way to the bank and sleeping like a baby at night because uncle ben is telling them he's going to keep the overnight rate at ten basis points, and he's going to be massively intervening in the market. what he hasn't thought through is that if there's ever a hint, a whiff, even a slightly detectable smoke signal that the fed is going to stop buying, all of these smart guys will get out of their trades. they'll unwind the carry. they will pay back, you know, the repo, sell the bond, and as the selling starts, yield will go up, prices will go down, ten the middle -- then the slower bond traders will figure out, uh-oh, something bad is sweeping its way through wall street, we better get out of the way. we should lighten our portfolio, so we will. and then the really slow-footed traders who are out in mutual funds in kansas city and other places will suddenly find that their end-of of the week mark is down. and my point is there is no bid. this market is so propped up, medicaided -- medicated, artificial, that if the fed ever stops, and, of course, it can't print $8 billion a day for eternity. why is anybody saving? just have the fed print money and drop it out of a helicopter, and we can all sit around having a good time. this is not a sustainable idea. they don't know how to stop it. they have taken themselves captive, and that's why we're in such a dangerous time. >> one more. >> [inaudible] with regard to the dollar as the reserve currency? >> yeah. well, it's a good question. but i think the whole idea of the dollar as a reserve currency is more or less a myth. a reserve currency -- you have a reserve currency and a fixed exchange rate system where something has to be the settlement asset. it can be gold, it can be dollars in a dollars-based system or sterling as it was in the 1920s. but when you have a floating rate system where every government is manipulating and managing its exchange rate like japan does, like china does, like taiwan does, a reserve currency has no meaning. what they're doing is buying dollars, putting them in the vault of their central bank, expanding their own money supply so they can keep their exchange rate down and their export machine, their mercantilist economic policy going. so what they're -- what is happening is the so-called reserve currency of the dollar has been transformed into, basically, a peck nhl for us -- a mechanism for us to borrow money from everybody else in the world through their central banks in constantly, you know, pegging their currencies and intervening in the exchange markets. i say if you look at all the a central banks of the world, they're doing the same thing. and it's a convoy of monetary roach motels. the bonds go in, but they never come out. and if you look at the u.s. debt today, so-called publicly traded, 12 trillion total outstanding, 5 trillion is in the vaults of central banks. that's not natural. what if these central bank withs stop buying or finally reach the point where they can't buy anymore? then on the margin you need real buyers, real at-risk investors to buy, you know, a trillion dollars of debt a year or maybe even more where i think we're going, and i think that's where the day of reckoning arrives. >> sorry, we're going to -- >> okay. >> first of all, quick round of applause for david. [applause] >> we'd like to hear from you. tweet us your feedback, twitter.com/booktv. >> look, don't mean to put you on the spot here, but, representative tom cole, what's on your summer reading list? [laughter] >> well, i'm reading as a good grinnell yang david roll's to wonderful book, "the hopkins touch," which is on harry hopkins, the legendary aide for fdr and a grinnell graduate. you know, we probably don't have the same politics, but i admire the political style, and it's a compelling life. probably next up for me i haven't had the chance to read the kaiser book, "act of congress," but the reviews have been pretty compelling. and i think, you know, that's going to be an interesting case study. and when you're reading a brook where you know -- book where you know all the characters, barney frank and senator dodd ask some of the legislators, it's interesting to get that perspective and some of the staffers. and then there's a book that i've just ordered on james burns who was, you know, a legendary south carolina politic. actually, jonathan martin, a politico reporter, put this on my radar. this is a guy who very nearly was, you know, vice president instead of truman in '44 and continued to play an extraordinary role in politics and became one of the architects of nixon's success in the south in '68 and '72. and he's actually, interestingly enough, just popped up working with harry hopkins on the 1940 in this book that i'm reading on the 1940 nomination of fdr, the third term, which was a pretty neat political work. so, you know, look, i like to read about the process, and i like to study history, and i ought to read more policy and less history, but i just seem to learn better in history. >> the title, "saving justice," comes from bob's decision not to resign after the saturday fight massacre. night massacre. which, by the way, he thinks should have been called the saturday night ip voluntary manslaughter. [laughter] because nixon didn't plan it, but just blundered into it. bob believed that the president has the authority to control everyone in the executive branch and to fire insubordinate personnel. and cox had proclaimed his insubordination on national tv. whether a president is wise to exercise that authority is for history to decide. attorney general richardson had promised the senate that he would maintain a special prosecutor in place, and he thought, therefore, that he had to resign when nixon asked him to fire cox. but bob bork had not made any such promise, and he thought that the president is entitle led to dig his own grave if he insists. he also thought that he should not gain by the deed and certainly should not appear to be a toadie. so he planned to fire cox and quit. richardson and william ruckelshaus, the deputy attorney general, talked him out of resignation. there was no line of succession in the department of jus us the after the solicitor -- justice after the solicitor general. so if bob had walked the plank, the department of justice would have been leaderless. to one knew -- no one knew who the president might install. richardson, ruckelshaus and bork all feared that it would be a political shell, leading the assistant's attorney general and much of the department's senior leadership to design and crippling the department. so bob bork saved justice by staying. had he quit in protest, he probably would have been treated as a national hero and confirmed to the supreme court in 1987. perhaps he would have been appointed by president ford in 1976 to the seat that went to john paul stevens. he was on the list that edward levy sent to president ford of possibilities. but had he quit, the nation as a whole would have suffered. so he stayed in office, in the sg's office. he was so determined not to benefit that he turned down an opportunity to be appointed as attorney general, he turned down the chance to work from the attorney general's more elegant office, he avoided the attorney general's private dining room, and he even turned down the attorney general's chauffer and limousine during the time he was acting attorney general. i can't say much more about those times. today occupied the last six months of 1973, and i did not arrive in the solicitor general's office until mid 1974. but everything bob bork says in his book he said in 1974 too. richardson, ruckelshaus and the people who worked with him most closely then such as edmund kitsch and keith jones tell the same story. and bork's narration in the book is entirely consistent with the man i knew for 40 years; intellectual, considering consequences before acting and absolutely honest. he's also the funniest man i ever met. that didn't come through in his 1987 hearings, but the book is full of his wit. [laughter] the life of a solicitor general, like the life of a judge, is reactive. other people decide what suits to bring with. the solicitor general controls the government's presentation in those suits to the supreme court. what petitions to file, what responses to file, merits briefs, oral argument, and the solicitor general also decides when the government will appeal an adverse decision by a district court or seek rehearing en banc in a court of appeals. the solicitor general has authority to decide when, if at all, to participate as amicus curiae in the supreme court or a court of appeals. it's a broad portfolio and requires a large base of knowledge, plus the ability to learn fast. the solicitor general does not control who litigates about what, and he doesn't start the process within the justice department. cases that arrive are farmed out to the litigating divisions; civil, criminal, civil rights, antitrust, tax, lands and natural resources and the environment. they make recommendations which go to the sg's assistants and deputies. sometimes there's an internal conflict. the department of justice includes the bureau of prisons in the criminal division, and those people always want to defend wardens and guards in suits by prisoners. the civil rights division tends to favor the prisoners. somebody has to resolve those fights. or an assistant to the solicitor general may think that the criminal division's statutory theory of prosecution is weak. the solicitor general has to resolve those issues personally. bob bork conducted many conferences not only to settle fights within the government, but also to hear presentations by private counsel. it's one of the office's traditions that anyone -- a litigant, a potential amicus curiae -- can be heard by the solicitor general personal hi before the united states files a brief in the supreme court. bob prepared carefully and asked sharp questions at these meetings. as e said in the book, he tried to advance the positions of the executive branch, not his own views. i never saw him favor his own position and never saw him misunderstand an argument. >> you can watch this and other programs online at booktv.org. >> there is no word the processed food industry hates more than the a word, addiction. and i do try to use it sparingly because they can rather convincingly argue that there are some differences between food cravings and narcotic cravings, certain technical thresholds. however, when they talk about the allure of tear foods, again, their language can be so revealing. they use words like craveable, snackable, moreishness. >> our online book club meets tomorrow night, and if you haven't read "salt sugar fat," you can still w

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