And my view is we need to take transformational reform to solve the too big to fail issue so we never have to ask taxpayers to do that again. Rose and they became vulnerable and could have failed in not rescued because they made such bad bets on subprime. Correct. We had a nationwide housing downturn that none of us predicted. And the banks disn see it either. The regulators didnt see it. And then they ran into trouble. Rose we continue with al hunt on the story with Governor Terry mcauliffe of virginia. You look at how many the democrats start out with and how many the republicans. We have a huge lead in the Electoral College. How do you grow that ledge torral college . Youve got to go to states of new mexico and colorado an nevada with large hispanic populations. They have watched this Republican Debate in the attacks on the hispanic community, on the immigrant community, whatever it may be. This is such a turnoff. And we generally get, you know n this mid 60s percent of the hispanic vote. With what has been said, i think what donald trump has said and others have said, i think you look at that hispanic vote, it could be a historic high for the democratic nominee. Rose we conclude with the legendary 9d 5 year old new yorker magazine writer roger angell. We find that the unbearable things happen to us. Losses, weight of losses seem unbearable. You go on and we show we are better. An were happier and we are looking, we are the same as we were before. Rose john michel that wait, terry mccallive, and the great writer roger angell when we continue. Funding for charlie rose is provided by the following rose additional funding provided by and by bloomberg, a provider of multimedia news and Information Services worldwide. Captioning sponsored by Rose Communications from our studios in new york city, this is charlie rose. Rose on june 23rd, voters in the united kng dom will decide whether to leave the European Union. As of last year the chances of seemed remote however a recent poll suggests that more and more britains do not want to stay. In what was seen as a major he beuk to Prime MinisterDavid Cameron london mayor bore is johnson recently declared his support. Johnson said remaining in the eu would lead to an erosion of democracy. Joining me now is john micklethwait, the editor an chief of bloomberg from 2006 to 2014. He was editor in chief of the economist magazine which is where i first got to know him. Im pleased to have him back at this table. Welcome. Im delighted to be associated with any erosion of democracy. Rose so explain this to us. The british have long been in a state of angst about europe. Right. Rose. Cameron decided to offer a referendum, huge debate about whether he should have done that, that is the starting point. Rose margaret thacher. The british have not voted on this since the 1970s. And i think there was a lot of pressure on cameron to give them a chance, to have another say on this. Its been building and building and particularly within the conservative party. David cameron both Prime Minister and head of the conservative party. Within the conservative party, the easiest way to think about europe is its roughly akin to being prolife in the republican party. If you want to get selected, being very sceptical about europe, is part of the committee. Anyway, cameron, his deal has always been he would go to europe and we come back, he said, with the kind of improvements in the relationship. I brought those back. Rose he associated with negotiated. He nshted with angela merkel, with fran choy hollande. He brought that back to parliament and said we will now have a referendum on whether to stay or go. I will offer everyone a free vote but i want to stay. Rose stop right there. Tell us what the European Union is and what is the advantage to being a member of the European Union. The main advantage to being a member of the European Union is that you are part of the worlds biggest free trade, the world worlds biggest economy. That is the main reason why people would generally think its a bad idea to ef loo. There is also a kind of bigger reason for the people who set it up which didnt include the british. People like the french and the german really, the European Union, was about trying to bring peace and longterm prosperity to europe. And it has always been slightly a project of the elite. It was set up at a time when people were worried about pop lism. They did for a long time, to be fair. For a long time europe was very popular. And there was a time even within the conservative party where you get back to the 1970s, back to the era of ken clark grew up in, back then to be a kind of proeuropean was a big thing in britain. Margaret thacher was less that way inclined and ever since then the conservative party has been more sceptical. And there is this sort of division in britain. The british are stuck. On the one hand with possibly the most cosmopolitan nation in the world. Weve always welcomed foreigners. On the other hand, we have quite an insurance lar thing, not surprisingly because we are an island. We are stuck, we are stuck. Rose so what did he nsht . The negotiation he essentially did is one where he has gained a little bit. And hes gained the idea that the European Union isnt always about evercloser union, particularly for britain. Hes got a few opt outs to do with welfare reforms. At the moment one of the biggest issues in europe is as you know well is to do with my grant, people going backwards and forward, in this case internal pieg rants for the European Union and what is happening people are getting angry about the number of poll, the number of czechs coming too britain, staying there and claiming benefits. Hes now got a rule which says youve got seven years before are you allowed to get benefits. Its worth something. But its not really the sort of thing you can go out and sell this on the streets of britain, that a great passionate declaration. The main argument for staying which he will make repeatedly is that the prospects of going out are much, much worse. And in some ways everything has been reversed. The idea logical dreamers, are largely those that want to take britain out. They think britain can become this free trading paradise outside the orbit. Rose britain is a member of the European Union but not the eurozone. Exactly. Rose that is the point i was making. There is the economic unity, there were two points i wanted to make and you corrected me, and im not sure that im not right. Were back on familiar territory. Rose we are. It is the idea that the idea of europe has had some economic dimensions which have been successful. The political dimension has not been successful. At times not, not at all and the british have never really bought into the political edge. Rose my point. But now there are many other people who are feeling the same way. France youve got marine la pen, other people throughout europe who are asking questions. Exactly. So the really dangerous thing about the thing at this precise moment, and i should confess, im one of those people who think that britain should stay in the European Union. I was somebody who was against it. I was against britain joining the euro because i thought all the Crazy Dreamers were in inside europe, this time i think the Crazy Dreamers are inside britain trying to take it a what. The main reason for britain to stay tsh tsh wz who with be a crazy dreamer. I think bore is johnson is being. Rose before the last time, in terms of joining, not joining the eurozone. I think back in terms of yoin joining the eurozone, pretty much a quite a lot of the big british banks, the cbi, various people came out saying it would be better to join the euro and they were wrong because britan had a different economy heading in a different direction. What is happening now though which is really interesting, and the reason why everybody pretty much, you know, america as well, this is about the west. As well as bilt an. I think that is an incredibly important thing to look at. If britain leaves it is probably bad for brilt an but also very bad for the European Union. Will you have france, germany, pretty much left there alone. You dont have this balancing fact. Youve also got the fact that the most dynamic economy in europe is britain. If it goes out, you can see all these other problems coming back to haunt it. And there are other things to do with security and all these other things. Gathered together. There is a reason for americans to worry. If europe acted as a unit, it would be the largest economy in the world. Yes, but its always going to have it is the largest economy in the world but its not in terms of kind of the clout that comes with that. The divisions within it. And cultural differences and everything else. Yes, i think, it is interesting what you were saying about the political thing. Ed bowls, one of the advisors, famously, he had a scrimtion. He once told me about a meeting way back in the old days when they sat around the table, the british, the french, the germans, everyone around the table, jack will lore, the great man at the center of europe, the man who pushed it forward, something went through then he turned to the belgians and dutch and said no, no, you have to do this for europe. And now the ability to persuade anybody, anybody at all to do anything for europe is much less. Its like the United States with each state fighting desperately. Rose is bore is johnson in opposition for political reasons or for a deep and passionate belief about economics and the European Union . I think there is a certain amount or strong amount of personal ambition. Theres always been tension between him and cameron on many many different levels. And he is dying i think to become the successor of David Cameron. There is principle as well. Bore is has always been on the side, hes always been a euro scept particular but so have many other people including cameron and osborn but they have made the decision that in this particular case, the cost of leaving is just so guy begannic, its not worth doing. Does George Osborn get all the credit and does he deserve most of the credit for whats happened to the british me . I think he deserves a lot of credit. Some people would say he took a bit of a gamble in the same way as David Cameron is taking a gamble now on this vote. I think what osborn did, has managed to do is convey the message that some degree of austerity was necessary, that britain needed to tighten its belt. Rose was it the right economic answer. The answer is in terms of the numbers, he has been proven right, there are many people, Larry Summers has to some extent had to i dont think that is going to happen. Rose who never thought. People said this wouldnt work. But actually strangely that balance between having tight fiscal thing never is quite as tight as osborn talked. And lose Monetary Policy has worked. The british economy is growing much quicker and better than the rest of europe. And that is another reason why if the british left it would have a dramatic effect on the rest of the European Union. Rose tell me what you think, and im really talking beyond im not sure what else there is to say. The vote will be when. The vote is june 23rd. And it is one where at the moment things are very close. Not that lodgeogue i wrote a piece called the 20 world. Where i said there is a 20 world where maybe you end up where a president trump, a whole variety of Different Things and a lot of those 20 s keep on going up. Rose where do you think shall is there any common trend you can see. I mean if you look at the labor party, its more left. Yeah. Rose if you look in france, lapene suggests that right wing parties have a certain, because of the my grants issue and other issues, a certain gaining of strength. In terms of what is happening at the moment, you look across the whole west am and you see a repeated thing. You see people who are angry and cross because they feel left behind by globalization, left behind by an economy which seems to be rewarding some people more than them, certainly particularly them. And they feel angry, they want change. They seem to be turning to leaders whether it is donald trump, whether it is mareven la pen, nie gel, some ways bore is johnson in this respect. And the people who say look, im the person who tells it like it is. Im the person who will tell you what is wrong with the world and will try and fix it and there is a deep kind of enu i as the french might say. The reason why the European Union is particularly prone to this is because it is very much an elitist project. Its one which is set up by the elite which is worried about pop lism. Whenever they have had referendums before and they have gone against the project, the eur poans have sent it back and said you go and vote again until you get it right. Is scotland, what is going to happen . I think one of the many consequences, one of the many reasons why this certainly makes a whole series of things happen, one set of things to do with britans relationship with europe and what happens in the European Union, what happens with scottland is also really interesting, because what is likely if the british vote to go out, is that the scottish will probably have voted to remain in. What will immediately happen after a referendum, the referendum is an exit, i think you can first expect to see David Cameron go. Very soon after that you could expect to see the scots say we didnt play any role in this. We want independence. Among the many many things that could follow from a break is probably the division of the united kingdom. And that is a big thing. Rose what is your best geses. My guess at the moment is that britain will probably stay in. But to leave an example, were sitting high above lexing tong avenue at the moment. If i said walk across the road there is a 60 chance you will reach the other side, i think you might think twice before going across it. It is the risk, the downside of this i think is a very big one. And that should frighten people. Even if the odds at the moment are on staying in. Rose in part that is the unknown. It is the unknown. And its the unknown because nobody has really had the clans to ask the british people about this. For 40 years. And its a state that people are angry with their leaders just as they are here. People are cross about the many things that have come from europe, quite rightly such as too much regulation, not enough opening up markets. And people fundamentally also, they want to have a say about this. And the real question much as it is with scotland, is will they be scared. Because i think the scared bit is in a strange way, everyone says you arent allowed to do negative campaigning. In this case as in scotland, the negative side will be dont do this. The risks are too high. Rose thank you for coming. Thank you, charmie. Rose back in a moment, stay with us. Neel kashkari is here, the president of the Federal Reserve bank of minneapolis. His career began as an aerospace engineer, after working at Goldman Sachs he joined the treasury department. There he oversaw the 700 billion bank bailout initiative. It was known the t. A. R. P. He made headlines last week after suggesting that regulatory efforts had failed to cur the risks posed by large banks. He proposed that they could be broken up and regulated like Public Utilities or have increased Capital Requirements. Im pleased to have Neel Kashkari back at this table. Welcome. Thank you, charmie, its great to be here. Let me just talk a little bit about your career. Were you an engineer as i sugd. I think you went as an analyst in Silicon Valley. After Business School i went to Silicon Valley when i was a banker at gol man. Yup. And then hank, who was a c. E. O. Of Goldman Sachs goes to treasury. And did you simply write him a letter or call him up. I called him up. I met him once for ten minutes. Rose he said come to washington lets talk. So i met with imhad, he was not yet confirmed sew wasnt a treasury yet. And i went in there with a pitch like i want you to hire me. And he just said stop with your pitch. I need somebody on my team who will just do whatever needs to get done. How does that sound. And i said. Sign me up. Rose this is a year before the financial crisis, none of us saw it coming. Then you had deep involvement as was suggested in the introduction. And then thats over. Yes. Hank leaves as secretary of the treasury. And then you go back to california. And were wondering what you are going to doment and you run for Public Office having never served in Public Office. And running for governor. Well, you know, i looked around the country and i saw a lot of people running for office and i thought if they could do it, why cant i do it. I looked at the state of california and i thought california still has, unfortunately, the highest poverty rate in america. I have lived the american em droo. My parents came here, immigrants from india, i grew up a normal middle class kid. I get to go work for the president of of the United States. What a great country. So i said i want to give every kid in california 9 same shot as i had. And that starts with a good education and getting a good job. That is what i ran on. You won the primary first time out as a politician. Yeah. You learn