it was mainly sponsored by the arkansas phase of things to believe honestly mrs. clinton lied in her answers. that is what most of it had to do with his lobbying on the answer is not with the conduct itself was less significant. >> guest: he told me monica sade hillary because the office of independent counsel was so focused and thought they had the president in their sights they thought this would be a distraction into be fair about it their assessment was at this point the chances of actually convicting even at the indicted were very low, so they chose not to do it but that was going on right at the time that they were pursuing the prison on the monica lewinsky charges. >> host: to testify against the president and the secret service presented then resisted that. and you tell that story. it devolved into were fbi agents were accusing the director of the secret service of participating to cover up. that is shocking. >> guest: i spent a lot of time on this in the book is you know and it is just a remarkable piece of the story. the head of the secret service who also happens to be from pittsburgh originally, decided to break his silence into talk to me and it was remarkable. he did believe, and really most of this story i checked out as carefully as i could. it was just remarkable that he believed the fbi was pretty much try to set them up to get him to agree that he was somehow facilitating liaisons' with the president and young women in the white house. >> host: feeding him false information hoping he could find out that false information. >> guest: having to do with the blue dress and telling them there was no dna on the dress. >> host: finally a lot of people after the president was acquitted in the impeachment case said well live least the system works. if you look at the entire story in the world that the institutions of government play, to think the system worked at the end of the day? >> guest: the system worked in this case? the system worked in the sense that the american public put a stop to this finally. it was the pressure of the american public this said enough, we have had enough in this trial has to come to an end but they think both sides in this and here i'm not thinking about ken starr and president clinton personally but both sides got to the point that they really lost their heads and were ready to win at all costs. there was not restrained in this i think is what produced the just collision that occurred here that was not good for the country and my hope in writing this in one of the reasons i spent so much time trying to get this right greg is really had to think we have to learn from this that we can never ever let this get to let ourselves get to this point again in the country. it was a devastating event when so many other things were neglected, so many of the things were happening which we now know terrorist starting to think about it tax on the u.s. and this is what we were focused on. >> host: one last question. henry hyde was the chairman of the gigi shahri committee, probably as responsible as any single individual for the impeachment of william j. clinton was defeated in the trial in the senate, but when you talk to him, he took pride in one fact and let me ask you my last question in this interview. .. thank you for being with us this evening. president obama today spoke and the first anniversary of the 787 billion-dollar stimulus package that passed the congress and he signed last february. here is a little bit of what he had to say and that we will get our authors reactions. >> we acted because we had a larger responsibility than simply winning the next election. we have a responsibility to do what was right for the economy and the american people. one year later, it is largely thanks to the recovery act that a second oppression is no longer a possibility. one of the main reasons the economy has gone from shrinking by 6% to growing at about 6%. this morning we learned that manufacturing production posted a strong gain. so far the recovery act is responsible for the jobs of about 2 million americans who would otherwise be out of work. >> host: amity shlaes what is your take, the president had to say about the stimulus package? >> guest: well peter i'm glad it is the stimulus anniversary because now we can say we are done with stimuli in 2010 will be a non-stimulus word and maybe barry that wording get it out of our public vocabulary, because stimuli don't work all that well regardless of what the president claimed. >> host: now, the president said the stimulus package presented a second depression. >> guest: well, i regard that as hyperbole. the analogy here for our economy is not the u.s. in the 1930's but rather japan, where there were i believe ten stimuli over a series so of the anniversary of the stimulus to get another stimulus and in the end japan's debt was up there with zimbabwe's in jamaica's and unemployment went in the wrong direction during that period so we want to compare where we are now to the '90s, what became the lost decade in japan and that demonstrated the weakness of stimuli as a care. plus could dean baker, same question to you. >> guest: wiley think president obama exaggerated the impact certainly but for example i don't think we did before the great depression. it requires not just one bad year but basically prolongs ten years of stupid economic policy and that something that was really in the cards but i think it did lead to growth, did lead to employment. there is a number of independent estimates in the congressional budget office, moody's, global so they are pretty much the same range somewhere in the order of 1.2 to 2 million might be a little high. 1.8 million jobs, probably closer to a percentage point added to and-a-half 3% of gdp or. that is a big deal. is not nearly enough and we are still looking at an unemployment rate that is almost 10% in projections are we are still even two years of looking at an unemployment rate averaging 03% and are now projected to get back to normal levels of unemployment until five years out which is why i would like to see much more stimulus but it is important to put this in context that we should've seen much more class february, but it did have a big impact and a positive impact. we would be much worse shape without a. host: you would like to see another stimulus just as big or bigger maybe? >> guest: to put this into some context of the look of our lost demand why are we in the situation? we have this housing bubble. we are building houses like crazy. we had a bubble and nonresidential real estate. that purse. the bubble wealth around $8 trillion in bubble well, most of that has disappeared. that bubble wealth was feeling so you to add up how much lost we have because of the collapse of residential and nonresidential construction it is somewhere in the order of $1.2 trillion a year. the stimulus package president obama has drawn on the table people talk about 787 billion. 87 billion of that was technical tax issues from the stimulus, around 100 billion or so will be spent in later years so if you say what are we spending 2009/2010 it comes to roughly $300 billion a year so we are trying to replace $1.2 trillion in lost man with $300 billion in stimulus. that is not going to be enough. i think it was a step in the right direction and i'm glad we did it but is nowhere near enough stimulus. >> host: ms. shlaes, any reaction to that? >> guest: i have the supply orientation so i would ask and a lot of us would ask, what would make someone want to supply something to supply a job, to supply a new-product? keene is arguing more from a keynesian perspective. i would argue from a classical perspective then when you have spending like that what happens if there are all kinds of distortions in the economy? to put it in common sense terms you don't know what the next emulous is coming if you are a little firm. you don't know where it will be. you know tax increases are coming to pay for the stimuli. you are worried about the health care situation. maybe that will help their business to have help from the government but it might put a mandate on you so you don't, you to not contribute to the economy and that very much is what is impeding our recovery. stimulus there gets in the way as opposed to helps. you can see purchases advanced over time. the government gives you get big enough offer you will buy a car this summer where the then next, but milton friedman, often you were moving around purchases he planned to make any way and you also by the way, sometimes don't purchase of all because you think we'll mac that that looks big overtime in the government will have so much debt in my lifetime, maybe i will be a lot more cautious than i might it then five years ago so all of these are factors. us the good evening to you also. as the mentioned at the top this is a call-in program and we want to hear from our viewers. (202)737-0001. here in the mountain and pacific times sounds 202-73-7002. you can also ascendancy tweet at twitter.com/booktv or an e-mail at booktv at c-span.org. let me tell you a little bit more about our guests before we get to your calls. for speier going to start with dean baker, the co-director of the center for economic policy research. he is the author of numerous books including "plunder and blunder" and his most recent is "false profits" recovering from the bubble economy. publications including "the atlantic monthly," "the financial times" and "the washington post" in currently writes columns for the american prospect, the guardian newspaper and trista or. if you want to follow his blog you can go to american prospect bought borgen click on the top of the tehjan blogs and you will find him there. his blood is called "meet the press." amity shlaes as a senior fellow at the council of foreign relations, syndicated columnist from bloomberg news service and a former columnist for the editorial board for "the wall street journal." she is written several books including "the greedy hand" how taxes drive americans crazy and what to do about it and the one we mentioned "the forgotten man," a new history of the great depression. she has a web site, amity shlaes.com. we want to show our viewers the federal budget proposed for 2011 along with the deficit then what is left for discretionary spending. the obama administration has proposed this. about $3.8 trillion in federal spending. that $3.81.4 trillion is in discretionary funds and the projected deficit is the old phrase that mr. ornstein learned in college was to budget is to choose. we no longer choose and that makes the over focus on the tiny share of the budget allocated to discretionary domestic spending so discouraging. amity shlaes, first of all is the deficit too big and do we not have enough discretionary spending funds? >> guest: sure the deficit is too big but what is different now safe from the 1980's or the '70s is exactly that tuition norm ornstein is the looting. were trapped by our entitlements, those created first of all and the new deal period such as social security. that is not the discretionary part and then you add to that the great society entitlements and also this is a bipartisan thing, medicare part d for example under president bush. they hog the budget and they hogget wider and wider in the discretionary spending is squeezed to decide. you want to mention also i believe defences discretionary people don't want to mess with that so you have discretionary spending that they are-- very narrow thing. the economic theory that fits here is called public choice theory which says government is aggressive and what you see when you see a budget like that this government winning. >> host: so, what is the solution in your view? is it cutting spending? is that raising taxes? >> guest: we used to save the cut taxes it will be alright. this time you can't do that. you have to have to rearrange the budget and rethink the entitlements and start with the idea that young people don't expect social security to be there for them in any case and we also were rained some of these things. i was interested to see congressman paul brian has a new proposal that is rather thorough. he changes social security, he changes health care, he changes the tax code radically. including for many high earners probably increasing their tax with the flat tax rate anyway of 25%, to rates ten and 25 and stop taxing capital gains and that is a big change. it is a completely-- that is the kind of discussion we need to have been there is more common ground i think in the two parties then one would imagine there. both parties have to talk about this, democrats and republicans about how the reform those nondiscretionary? >> host: dean baker. >> guest: first thought in terms of the budget deficit, we have big budget-- deficits. people like alan greenspan and ben bernanke gave us the largest downturn since the great depression. that is why we have a huge budget deficit. we didn't have a huge tax cuts. we had stimulus and response to the downturn. we have higher unemployment if we have not had that but let's be clear if we are upset about the deficit greenspan and bernanke, i don't know why we reappointed bernanke. in terms of the entitlement programs, yeah we have a public pension program, which is hugely popular. you look at polling day that-- i was at a conference this morning in social security is over 90%. they ask people would you be willing to pay higher taxes to sustain sosa security benefits and 70 to 80% said yes. i don't see any problem with running a pension program through the public sector. what is the problem with the? it is usually popular. health care costs, medicare again. we are providing medicare health care benefits for seniors. that is also hugely popular. you have these tea party people out there yelling don't let the government touch medicare. they are anti-government but they want medicare. medicare is a government program. these are success stories. our health care costs are out of line in such as security has not been rising in its share of the budget and it will in the near future is baby boomers are retiring and getting benefits. in fact it actually fell a few years back but in any case that is not the big share of the budget. medicare because we have they broken health care system and president obama was trying to address that, but that is the direction you have to go, so we want to talk about getting our budget in line really this is a health care story and one point to understand here, we pay more than twice as much per person as people do in any other country we think is comparable, germany, canada, whatever country you want to point to. with we have the same for person health care costs we would have enormous surpluses as far as the eye can see. so we have an enormous health care problem and that is dealing with special interests, the pharmaceutical companies, the medical supply companies, the doctors, the insurance companies. congress is not anxious to tackle those but if we are worried about the long-term budget situation it is the health care story. >> host: it is time for your calls. carlynn indianapolis, your efforts. >> caller: hi, my question is for dean baker and it involves the viability of the campaign stimulus. let me first-aid i'm a lifelong democrat but i have major questions on how any keynesian stimulus will work when the conditions that allowed the keynesian stimulus to work under fdr namely, that we had very limited in flow of workers the immigration. not what we have today. we have massive inflows of new workers, i think 1.5 million issued new visas every year according to the census department and i don't know how many illegal entries for workers. it seems to me the keynesian stimulus worked precisely because under the 1924 immigration act there was relatively little in flow. >> host: mr. baker? >> guest: i don't think immigration changes the story. i think your numbers are a little high. mini emigrants, accounting undocumented workers and illegal immigrants but many of those are not workers. some of those are families, kids and parents of people who work here but in any case that has some medpac that would say on wages that there is a lot of research showing wages of less educated people tend, there is downward pressure but in terms of that total employment picture that is a relative drop in the bucket in the scheme of things so i think we should be talking about immigration policy because they think the current policy is a complete disaster, having millions of people work off the books is that for them in bad for workers and i would like to see those people in a situation where they can work on the books. they actually did not break the law. the people that hired them for of the lahsa we could throw people in jail for hiring undocumented workers and we could talk about that but i think we should be performing immigration law but that is not what is preventing the economy from growing and that is not why we have 70% unemployment. >> host: thomasville, pennsylvania. thomasian on the line with amity shlaes and dean baker. >> caller: how are you doing? great programming c-span. i have a couple of quick questions. one is the regulation of derivatives, there is none as of yet and i think that was one of the reasons what has happened with this debacle, and also, it is one of the things where the pendulum sometimes swings too far and you can't regulate too much, where you fort growth but you have to regulate somewhat because of the things we just saw like thomas jefferson said if men were angels there would be no need for government. also come on the one gentleman, mr. baker mentioned about another stimulus package. where are we getting this money? is that just seems to be building and building and building. >> host: amity shlaes would you like to address those concerns? >> guest: thank you for that question. the regulation of derivatives is important because there was a big what we would kindly call disingenuousness on the part of the market and regulators since derivatives fell between regulators they didn't have to be regulated and we have lived with the consequences of that but i would also save one reason we need to regulate derivatives is the too big to fail doctrine, and a better way to go about this is to let those who invest poorly in derivatives failed. then they want next time make the wrong that. if you overregulated and overregulated and then press ewind westy you have a postal system, very team, not susceptible to strong growth, makes the u.s. less competitive so the standard for derivatives regulation should be transparency, markets and clarity not arbitrary prosecution and beating up cases where the agency goes after this person or that person but if you have lots of clarity about how derivative should be traded and were, that is fine. it is time to cooperate internationally. what is not find this to make prosecutions out of it and again the problem behind it is the too big to fail doctrine because then too big to fail banks will trade in derivatives. host: the gentleman referred to our programming last night. we had discussion of the wealth of nations by adam smith. amity shlaes one of your books is called "the greedy hand." is that any reference to adam smith's invisible hand? >> guest: not really, although it is related. it is from tom paine who spoke of "the greedy hand" of government, thomas paine, making our prosperity its prey. when i wrote this book we had prosperity. it was the '90s but it seemed that taxes for some of getting in the way so i was trying to capture that. thomas paine was a great pamphleteer from around the time of america's founding. >> host: very quickly what is your opinion of adam smith and alimport missy today? >> guest: he is very important and he is worth bringing in. i am j