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tv   PBS News Hour  PBS  May 7, 2010 7:00pm-8:00pm EDT

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captioning sponsored by macneil/lehrer productions >> brown: good evening. i'm jeffrey brown. employers added 290,000 jobs in april, the biggest hiring increase in four years. >> warner: and i'm margaret warner. on the newshour tonight, signs of an economic recovery were tempered by continuing market uncertainty in europe and here. we'll assess the economy and look at the markets' volatility. >> brown: then, simon marks reports on the dramatic outcome of the british general election, where no political party emerged with a clear mandate to govern.
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>> a big, open and comprehensive offer to the liberal democrats. i want us to work together in tackling our country's big and urgent problems. >> warner: coalition negotiations are underway. we'll get three views on the horse-trading that lies ahead. >> brown: and we close with the weekly analysis of mark shields and david brooks. that's all ahead on tonight's newshour. major funding for the pbs newshour has been provided by:
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and with the ongoing support of these institutions and
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foundations. and... this program was made possible by the corporation for public broadcasting. and by contributions to your pbs station from viewers like you. thank you. >> brown: u.s. employers revved up hiring last month, even as more people entered the workforce, causing the overall unemployment number to rise. in the meantime, wall street continued its losses. the dow jones industrial average lost nearly 140 points to close at 10,380. the nasdaq fell 54 points to close at 2,265. that came amid uncertainty over the situation in greece, and questions over what led to yesterday's sudden 1,000 point plunge. newshour correspondent kwame holman begins our coverage. >> holman: payrolls expanded by 290,000 in april, the most in four years.
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of that, private employers added 231,000 new jobs, with widespread gains across a number of industries, including manufacturing, construction, retail, education, and health services. another 66,000 temporary government workers were hired to help conduct the census. despite the job growth, the unemployment rate still rose two-tenths of a point to 9.9%, as more than 800,000 jobless americans resumed their search for work. at the white house, president obama called today's report "very encouraging news." >> yes, we've got a ways to go, but we've also come a very long way. and we can see that the difficult and, at times, unpopular steps that we've taken over the past year are making a difference. >> holman: on capitol hill, reaction to the jobs report from members of the joint economic committee was mixed, with republicans contending democrats had not done enough to create jobs. kevin brady represents texas' eighth district.
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>> a painfully slow recovery is better than no recovery, but for the 15.3 million americans who are out of work and waiting for washington democrats to finally focus on jobs, this report is disheartening. >> holman: the jobs numbers also didn't stop the jitters on wall street a day after one of the most volatile trading sessions in history. a computerized sell-off midday yesterday sent the dow jones industrial average plummeting nearly 1,000 points in about 30 minutes. >> it's like "terminator"-- machines taking over. >> holman: some reports indicate the activity might have been caused by a simple typographical error. meanwhile, some members of congress are now pressing government regulators to ensure that high technology trading is well-monitored. mr. obama said yesterday's events are being investigated. >> the regulatory authorities are evaluating this closely, with a concern for protecting investors and preventing this from happening again.
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and they will make findings of their review public, along with recommendations for appropriate action. >> holman: even before the sharp drop in the market, stocks had been lower. the main cause was investors' concerns the $140 billion bailout for greece by the european union and international monetary fund might not be enough to stop the debt crisis from spreading throughout europe. today, g-7 finance ministers were teleconferencing on the crisis, while the german parliament approved its share of the rescue package. chancellor angela merkel spoke before travelling to brussels for a meeting of the e.u. >> ( translated ): this is a very important decision that makes clear that we are protecting the currency in the interests of our citizens. but it can only be effective in combination with the ambitious greek austerity plan, which was passed in the greek parliament yesterday. >> holman: president obama said he spoke with merkel this morning about the greece crisis, and made clear the u.s. supports the rescue efforts.
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but even with the support of the international community for greece, anxiety over the country's debt issues rattled markets in europe and asia. >> brown: and we turn next to two economy-watchers: mark zandi, chief economist at; and mohamed el-erian, c.e.o. and co-chief investment officer at pimco, a global investment management firm. mark zandi, starting with you what are the jobs number tell you. a lot of jobs across lots of different industries. you know, we have been in recovery for six to nine months. but the missing link was job growth, i think we found it today. very positive report indicates that the economy should do much better going forward? >> and you see it you said widespread among key sectors, fill that in a little bit. >> it was very broad based. it was manufacturing. it was construction, two sectors that have been losing lots of job during the recession.
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it was leisure hospitality, it was retailing, it was parts of financial services. it was of course the federal government because of the census hiring. almost every sector added a bit during the month and that is a very good sign. >> and mohamed el-erian, what do you see in the jobs market. >> same as mark. we are finally seeing all these cyclical tailwinds translate into job creation. and the question is can this continue given what else is going on in the global economy. but on a stand-alone basis, today's report was strong not only in terms of the headline number but also there were parts revisions that created even more jobs over the last few months. >> and just to explain, mr. el-erian why the unemployment number went up, more people are coming back to the workforce. in theory that is a positive right? >> correct. at people see their neighbors getting jobs, they are encouraged to start looking for jobs again.
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so ironically you get both job creation. but you also get more people looking for jobs so the unemployment rate goes up. in this case it went up to 9.9%. >> so the question, mark zandi is the pace, the rate of growth of jobs. and it sustained these people coming in. and the number of jobs that we need to create to get the economy really moving. >> right. i think we need approximately 150,000 jobs, each and every month just to stabilize unemployment so to bring unemployment down in a meaningful way we would need job growth of 200, 250, 300 k. now we got that in the month of april. we got a similar kind of job growth in march. we now need to see that over the next six, 12, 24 months. we need consistent job growth. and the preconditions for that are in place. businesses are doing much better. corporate profits are up. their balance sheets are in better shape. so they are-- it's no longer a question of are they able to hire. it's really a question of are they willing.
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>> well, mr. el-erian, you just raised that big uncertainty of what's happening around the globe particularly in greece. spin that out a bit. how worried are you and how does that then play into the positive signs for the economy we've just been talking about? >> it is worrying. this week greece went from being a country problem to being a problem for europe as a whole. and it starting morphing into a global problem. so if you are in the united states, there are different implications. first and foremost, unfortunately things are going to slow down in europe as a whole. this is a deflationary shock. it's going to reduce activity. it's going to reduce demand. and therefore it's going to reduce the ability of europe to buy exports from the united states. secondly, what's happening in greece which is fundamentally a solvency issue, people are worried whether greece will pay back its debt, despite the 140 billion dollar package that
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was referred to earlier, the market is still worried about solvency. it is worried about greece's ability to pay off its debt over time. because of that there has been an increased risk aversion. people are getting nervous about what's next. and in particular, what happens to the banks that are exposed to greece. now as you know, banks are like the oil in a car. they connect things. if the oil in your car does not work, the car doesn't go forward. and what we started seeing this week is that the european banks are getting under pressure. so that ended to disrupt sentiment. and that is why we have seen sell-off in markets. there was one silver lining in all of this, which is capital that would have otherwise gone to europe may well be diverted into the united states. and that's why our interest rates have been coming down this week. >> you mean the united states has a safe haven amidst all the problems elsewhere. >> yes, my former colleague says sometimes you wonder
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where you want to wear your cleaner shirt but there are times you have to settle for your cleanest dirty shirt. there are times you live in a relative world. and relative to europe today united states looks attractive to foreign investors. >> mark zandi, how does all of that temper your more positive view, especially with these job numbers for the u.s. economy? >> well, if the greek debt crisis continues on, if it's not quelled by policymakers, then it would change my view. i mean i think the greek situation is if unchecked will undermine our stock market and the stock market has been key to strong economic growth. it's the reason why consumers are outspending. it's why businesses are starting to hire again. so it's very, very important for policymakers. the european central bank, the european union, the imf, to really engage here and quell the crisis. and they have the tools to do it. the ecb can provide more liquidity to the banking
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system, mohamed mentioned the problems the banks are having, they can help with that. they can also lower interest rates if the european economy does, in fact, begin to struggle. in the u.n. imf they put forward $140 billion but clearly that is not enough. they can increase the size of package and get creative how they provide aid this is a policy decision on their part and they need to put an end to this so it doesn't become a larger global economic problem. >> mr. el-erian we talked about this last night, i want to ask you the same question, to what extent do the problems that you see in greece and perhaps spreading elsewhere in europe, does that raise questions about our own long-term debt problems here. is that an issue here, or is it really 9 more immediate, as you were laying out before the impact on our exports and the connections there? >> it's both. in the short term, it's a contamination from europe. but over the longer term, what is happening in greece tells you three things that
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has to be taken very seriously in our country. first, deficits and debt matter. you can't simply ignore them year after year. secondly, it is important to have flexibility in the budgetary system to respond. one of the problems greece has is even if it's willing to adjust, it's finding it self not able to adjust. and that's because the situation has gotten so bad that there is limited flexibility. and the third lesson that greece tells us all is things can change very quickly. who would have thought that within a few weeks not only would there be doubts about whether greece could make its debt payments, that there would be doubts about what the euro zone would look like from 6 months toary i year. so things can change quickly and it is important we don't waste time. >> and mark zandi, very briefly, do you expect more market volatility based on that uncertainty? >> yes. because to get out of the financial panic and great
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recession every country had to engage in massive fiscal stimulus. i think was absolutely necessary that they did that because we would still likely be in recession if they hadn't. but the downside is now every country including our own has a very large deficit, a very large debt load. and each country is going to face this problem unless they make the hard choices and clean up their fiscal situation. >> mark zandi and mohamed el-erian, thank you both very much. >> thank you. >> brown: and now, what did happen yesterday to briefly cause the stock market to plunge 1,000 points? and could it happen again? for that, we're joined again by susie gharib, anchor of pbs's "nightly business report". susie, thanks for joining us again. what-- what more is known today about what happened yesterday? >> you know, it's hard to believe but they're still trying to figure out what happened. it turns out that decoding what happened yesterday is not so easy. there are very complex systems at work here. officials here at the new
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york stock exchange as well as the nasdaq and regulators are investigating. here's what we know tonight. at first it was thought it was human error. now turns out that is too simple an explanation. the focus now is on computerized trading. it appears that some dramatic moves in the currency markets yesterday may have triggered computerized program selling in the stock markets. and once that happened, the stock transactions were like a domino effect. anything that was available to sell was sold. also today a lot of fingerpointing going on between the new york stock exchange and the nasdaq, the blaming who was really at fault here. the chicago mercantile exchange said eferl was properly functioning at our exchange. the exact origin of what went wrong t will probably take a couple of weeks until we know when the investigations are all wrapped up. >> but there is still the how in the world, you know, we all remember this happening in the past when there were some really huge drops. and then my understanding was they put into place what they call circuit breakers. so that there would be a
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kind of cooling-off period before things really got out of hand. now does this suggestion the circuit breakers aren't there or they don't work? do you think people are getting around it? what's going on? >> no, the circuit breakers exist, but there are certain situations that have to happen for the circuit breaker to kick in. at the new york stock exchange, for example, the dow has to drop something like 10% for the circuit breakers to kick in. but after 2:30 p.m. the dow has to drop something like 20%. well, all of this comotion happened after 2:30 and the dow did not hit that 20% threshold. the other thing is there are circuit breakers for individual stocks. and that did happen yesterday. because procter & gamble, for example, dropped 10%. and the circuit breakers kicked in. trading on that stopped. however, the electronic traders, the traders on electronic exchanges bypass that and they still went on to do trading. and so the selling was continuing outside of the new york stock exchange. now the new york stock
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exchange believes that investors would be best served if everybody had circuit breakers in place. and that they all kicked in together in a universal point of view. but the electronic exchanges say we want to have continuous trading. so this is an ongoing debate. and so yesterday's the circuit breakers didn't really have an impact. >> and briefly, as you said, there's fingerpointing going on. and the sec is now involved looking in to make sure, see what happened and make sure it doesn't happen again. >> right. and you know, until we know what happened, it's kind of hard to know who is going to fix this problem. if it has to do with the exchanges, then the securities and exchange commission will get involved. if it has to do with the futures contracts on futures exchanges, then the commodities futures trading commission will get involved. one way or another, all of the exchanges are going to have to have a say-so in how to fix this problem. and of course there are log lawmakers in washington already today a house subcommittee is said they are going to have hearings
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on tuesday to figure out what was behind this whole market drop. and what should be done to fix it. you know that already congress is talking about financial reform because of the financial crisis and too big to fail. now it looks like wall street regulation is also going to be on the table. >> all right, susie gharib with nightly business report, thanks again. >> warner: still to come on the newshour: the british cliffhanger election; and shields and brooks. but first, the other news of the day. here's hari sreenivasan in our newsroom. >> sreenivasan: a massive containment dome made its way 5,000 feet to the bottom of the gulf of mexico today to try and cap the well that's been leaking for 17 days. newshour correspondent tom bearden has our report. >> reporter: the 100-ton concrete and steel box began its long descent into the water last night. thick brown oil adhered to its side as it traveled through the gulf waters. b.p. hopes the dome will be able to capture up to 85% of the crude oil still flowing from the well, and funnel it up to a
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waiting tanker as soon as sunday. a top b.p. executive gave this update. >> over the weekend, we expect to connect the dome to the ship, and hopefully will begin to evacuate oil from the seabed. this hasn't been done before, and undoubtedly will have complications. >> reporter: efforts to stem the leak grew more urgent as the huge slick began lapping the shores of louisiana's chandeleur barrier islands yesterday. today, louisiana governor bobby jindal flew over those islands to observe the damage firsthand. eyewitnesses have reported seabirds diving into oily waters and dead jellyfish washing up on the beaches. the oil hasn't crept as far as alabama, but workers are still deploying more booms to try to keep it out of mobile bay. the edge of the slick is now about 30 miles offshore and stationary for now, but forecasts are it could reach the beaches in three or four days,
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depending on the weather. it's a beautiful spring day on dauphin island on the south coast of south alabama. there are a lot of people on the beach, but we're told there should be a lot more. several we spoke with are wondering if they'll be able to come back anytime soon. sonia summer has been coming to these shores for 15 years. >> i am concerned about it, mainly for the wildlife and or the marine life. the beaches won't be white, but i am sure it will come back. they will get it fixed. >> reporter: jeff villmer and his family are visiting here from st. louis, and worries about the long-term impact on tourism. >> it is tragic. we actually started to smell some of the oil this morning, probably from the breeze coming off the ocean. i think people are afraid to come down. it all is going to depend how well they can prove the cleanup. >> reporter: at the west end of the island, national guardsmen were extending shoreline defenses, filling containers with sand, in hopes of keep the oil from getting too far inland.
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>> sreenivasan: also today, federal regulators said they are examining the effectiveness of blowout preventers on offshore oil wells. they are the last-resort cutoff valves that failed to work in the "deepwater horizon" incident. a new safety board established at the interior department will lead the investigation. police closed part of times square in new york city briefly today after a suspicious white cooler was found. police said it was just a few blocks from where a failed car bomb was discovered last saturday. but on closer inspection, the cooler contained water bottles and books. in the saturday case, the associated press has learned investigators are searching for a money courier who may have helped faisal shahzad finance the plot. shahzad is the pakistani-born american citizen who was charged on tuesday. today, the head of the u.s. central command, general david petraeus, said he thought the suspect was a "lone wolf" terrorist who did not work with others. two more nato troops have died in afghanistan. officials announced both died yesterday, one in an insurgent attack in the south, the other in a rocket attack in the east. there was no word on the
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victims' nationalities. ten nato service members have been killed so far in may. back in the u.s., a widespread recall was issued for romaine lettuce amid fears it could be contaminated with e. coli bacteria. the lettuce was sold in 23 states and the district of columbia under the freshway and imperial sysco brands. at least 19 people have become sick; three of them were hospitalized with life- threatening symptoms. the food and drug administration is focusing its investigation on an arizona farm as the possible source of the outbreak. those are some of the day's main stories. i'll be back at the end of the program with a preview of what you'll find tonight on the newshour's web site. but for now, back to margaret. >> warner: now, to that no- decision british election. we start with a report from simon marks. >> reporter: as the votes were counted late into the night and early into the morning all over britain, it soon became clear that the country was indeed sailing into uncharted political waters. the election proved to be a disaster for all three major political party leaders.
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gordon brown suffered a drubbing at the polls. his ruling labor party lost 90 seats in parliament, though last night, he claimed... >> the outcome of this country's vote is not yet known, but my duty to the country coming out of this election is to play my part in britain having a strong, stable and principled government >> reporter: that's because david cameron of the opposition conservatives failed to win a mandate of his own. his party gained more than 95 seats in parliament, its best result for 80 years. but it fell short of securing enough of them to enjoy an outright majority, and therefore the automatic right to become the country's next prime minister. to secure power, he wants the support of nick clegg, leader of the third-ranked liberal democrats. despite the electricity clegg generated on the campaign trail and in televised debates, the
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liberal democrats actually lost seats in parliament. but still the potential king- maker in british politics, nick clegg quickly opened the door to coalition negotiations with david cameron and the conservatives. >> it is now for the conservative party to prove that it is capable of seeking to govern in the national interest. >> reporter: within hours, david cameron seized on the opportunity presented by mr. clegg's willingness to begin a conversation. >> i want to make a big, open and comprehensive offer to the liberal democrats. i want us to work together in tackling our country's big and urgent problems-- the debt crisis, our deep social problems, and our broken political system. >> reporter: gordon brown remained holed up in his downing street office. there were no traditional post- election pictures of moving vans arriving to escort the loser out of power. late today, he said he'll let
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conservative/liberal negotiations play out. >> i understand and completely respect the position of mr. clegg in stating that he first wishes to make contact with the leader of the conservative party. clearly, should the discussions between mr. cameron and mr. clegg come to nothing, then i would of course be prepared to discuss with mr. clegg the areas where there may be some measure of agreement between our two parties. >> reporter: so, where does britain go from here? all signs point to several days of uncertainty as the three party leaders jockey for position and horse-trade over policies in negotiations to create some kind of workable agreement. for now, it's impossible to predict just who will end up walking through the door of number ten downing street. but it is possible to identify one of the key issues that will dominate coalition discussions-- the liberal democrats' passionate belief in reform of
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britain's electoral system. they want the country to embrace proportional representation, a voting system used in many european countries that would give the country's smaller political parties much more muscle in its parliament. david cameron moved quickly today to signal his willingness to discuss the issue. >> i believe we will need an all-party committee of inquiry on political and electoral reform. so i think we have a strong basis for a strong government. inevitably, the negotiations we're about to start will involve compromise. that is what working together in the national interest means. >> my view is that we're going to see another election this year. if not this year, then very early next year. >> reporter: britain is in for much political churn, says commentator anthony howard, a former deputy editor of "the observer" newspaper. but the gordon brown era, he believes, is sure to end. >> it's also crystal clear that
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the conservatives got a sizeable, much larger slice of the national vote than he did. though it's difficult to know who won this election, we know who lost it, and that person is gordon brown. >> reporter: in finchley and golders green, that closely- contested north london district the newshour profiled on wednesday, it was the conservative candidate who romped to victory. mike freer will now be a member of parliament, but like everyone else, he doesn't know if his leader, david cameron, will be prime minister. >> i think it's not surprising that the prime minister will try to cling to power, despite having clearly lost the election, lost the popular vote and lost the confidence of the country. and as i understand the constitutional niceties, he really should step down and let a fresh party try to form a government. >> reporter: in the west london area of notting hill today, and across the country, voters were reacting to an era of
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uncertainty in british politics that many analysts argue is reflective of broad dissatisfaction with all the main political parties. >> i think it is a great display of immaturity on the part of the british politicians that they can't actually now say, "okay, we have to work together on this." >> quite predicted this would be the case. i hope a good outcome, that parliament will have to be made up of more people that are working together than the past. >> reporter: and the drama that got underway in britain today could soon involve another major player in british society. in the event of a closely fought election, queen elizabeth ii-- usually thought of as merely a ceremonial head of state-- has the constitutional power to determine which political leader is invited to form a government. and that government needs to be formed soon. parliament is due to reconvene on may 18, with the queen opening it ceremonially one week later.
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>> warner: more for me wet three perspectives, from matthew parris, a columnist for the times of london, he was a conservative member of parliament from 1979 to 1986. martin walker, a former correspondent for the guardian newspaper, he's now chief international affairs writer for upi and he's also senior director of the global business policy council, a for-profit think thank. and michael elliott, the deputy managing editor of "time" magazine and editor of its international edition. and welcome to you all. michael elliott, let me begin with you. what do you think the british people were saying in this election? >> well, margaret, i think they were-- i think they were saying athat they didn't particularly like any of the choices that were in front of them. gordon brown lost this election. i think that's pretty plain, after 30 year approximates in government and administration, the electorate pretty clearly shows that they've had it
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with him, losing 90 seats or whatever it was. at the same time to use what has sort of become a cliche over the last few years, david cameron, the leader of the conservative party didn't manage to close the sale. i don't think he's particularly-- particularly loved by the great mass of the electorate. as for the liberal democrats, who had their moment in the sun a couple of weeks ago, i always trust my wife on these matters because she is the best observer of british politics i know. and she has been saying for the last week the lib dems won't poll nearly as well as the opinion polls are telling us. and she was absolutely right. they came in at about 23%, the polls were saying 26, 27. so i think there's reason for all three parties to be pretty disappointed about the outcome. i think if you stand back and look at this in the round, you would say that britain has a center left majority in terms of its politics in society.
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the tories didn't manage to do more than 36% going against, as i say, a very unpopular administration. and i think they'll be pretty disappointed with that. >> warner: matthew parris s that how you see it, that really was kind of a-- on all their houses? >> no, i don't see it like that. you cannot have a three-horse race in which all three horses, had they taken a realistic view of their prospects, could be disappointed by the results. the fact is the labour party lost nearly a hundred seats in the 650 feet legislature. the conservative party achieved the best result that they have in 80 years. and the better result than margaret thatcher achieved when she came to power. and the liberal democrats did just about as well as they did last time. what is fair to say is that the conservative party would have hoped really to have swept the board on a great wave of national enthusiasm for a right of center
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alternative to gordon brown and they didn't do that. the electorate have shown that they don't care for gordon brown. they've shown that they are not entirely persuaded by the kind of doe-eyed chat up lines of the center party candidate nick chraing, the leader of the liberal democrats but they are still a little cool about david cameron and he's got, i think, some important battles to win in wing the confidence of the electorate. but there's no question he is by far, he leads by far the largest party in the house of commons now. no question but that he should be prime minister and given the chance to try. >> martin walker, follow up on that but let's get into also the horse trading. david cameron and nick clague have talked today, we're told. what are cameron 's-- what are the prospects for the tories and liberal democrats to do a deal and come up with a coalition government. >> the real problem is that the british people didn't speak, they mumbled and they shuffled their feet and they
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couldn't really make a decision. and what's extraordinary is that gordon brown should have lost by a greater amount than he did. because it's the worst economic recession for 80 years. an exhausted government after 13 years in office. but labour is not down and out. what's remarkable, if you look at the vote is that the tory vote, the conserve-- conservative vote shank as you went north up the country and virtually disappeared into scotland so a pure conservative government would not represent the country as a whole. the conservative was need support from the liberal democrats. labour democrats would have over 50% of the vote. they would have some kind of legitimacy in that sense. the real problem now is that the terms on the liberal democrats demand which is for forced representation-- . >> warner: changing the voting system, essentially. >> that's right. so instead of first-- we would have a proportion 58 number of seats depending how many vote us got. that would put the liberals into the position of being virtually in power forever. and so far cameron is not
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prepared to go that far. he's promised a house of commons committee to discuss it. gordon brown has already promised instant legislation. and so for the liberals, they must now make that choice. do they go with gordon brown or labour where they might demand-- or do they go with the conservatives with whom they disagree profoundly over things as important as relations with europe. >> warner: matthew parris, what do you think are the prospects for any, either of these two major parties wanting to make a deal with the liberal democrats when, in fact, if you had a whole different voting system without getting into all the details, those two, the tories and labour would eliminate the kind of duopoly on power that they've had for quite a while. >> the prospects are very good. it isn't the case that labour plus the liberal democrats would have more than half the seats. they wouldn't. that's one of the problems. the liberal democrats plus the conservative party would have a very convincing majority. but the question is, are
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they of one mind. do they see things sufficiently closely to make an effective coalition as it were government. and i think that they do. the liberal democrats and the conservative party believe in the free market. the liberal democrat its and the conservative party both believe in the liberty of the individual. they have important differences on the european union. i think those differences can probably be settled. the really big difference between them is the tories. the conservative party don't really want to change the voting system. the liberal democrats do. i think the solution is probably a grand commission of some kind to look into it and put conclusions to the electorate in a referendum in about a year's time. i will fully expect nick clague and david cameron after two or three days of talking to come to some sort of arrangement in which the conservative party will lead a minority-- mrtion and the liberal democrat party on
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the basis of prearranged discussions will support it from the outside. >> warner: michael elliott, your view on all this? >> i think matthew is absolutely right. i think that's exactly what is going to happen. i think david cameron is going to form a minority government as wilson did in similar circumstances in february 1974. i think the liberals will stay out of a formal coalition. but our to the conservatives support on something like an agreed plan. i think matthew is also right that david cameron has a right to try that, to try and be prime minister. you claim he has the large number of seats in the house of commons and i think he's entitled to try that. and the liberals will find-- . >> warner: let me just ask you then, michael. so you are saying gordon brown, you don't think he will ever even give himself the chance to to form a government with the liberal democrats? >> i think nick clague has been principlesed and brave in saying that he would talk first to the person who won
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the most number of seats and the highest proportion of votes. and that plainly is the conservative party. i think it would be extraordinarily difficult for the liberals, notwithstanding the fact liberal democrats, notwithstanding the fact that they have some key policy agreements with the labor party, particularly on electoral reform, to appear to prop up the prime minister who had been widely rejected in the country. i am not sure that that would be a long-term sensible bet for chraing to make. >> let me end quickly with all three of you on a bigger picture question which is the pound sterling took another beating today. the european markets are troubled by this indecision. martin beginning with you, what kind of pressure does that put for a quick resolution here but then what does this muddled result say about the prospects for any british government to take the tough steps it has to do to deal with this huge deficit it has. >> well, it sharply cuts the time available for the politicians to operate and to haggle over the terms. because the political timetable is running much
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more slowly than the market's timetable. i think they have to reach a deal by monday or tuesday otherwise an economic crisis, higher interest rates, collapse of the pound, start becoming possible. the real, i think the real issue now is going to be whether there is going to be enough of a consensus among the two key parties, liberals, conservative and the labor party as well to come to some kind of national agreement about the sheer depth of the cuts that will have to be made. it's a 13% budget deficit. >> suarez: . >> warner: second only to greece. matthew parris, briefly on that point. >> i entirely agree with that. we are as a nation dancing on the edge of an abyss. and any party that looks as though it is just concerned with add miring its own electoral nest or making complicated complications for the other two in dealing with the crisis is going to be rejected decisively by the electorate. the electorate are looking for groupup politicians to deal with each other and
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come forward with a national plan to preserve it in these difficult circumstances. and i think all three political parties are very conscious of that. >> warner: mick-- michael elliott, do you think we'll see this kind of national con sense-- consensus? >> i'm not sure that we will, although the markets might force it. i expect that there will be a flight to dollar denominated assets and the dollar on foreign exchange markets next week. there will be pressure on the euro and the pound. and that the global economic outlook after this election and after the greek crisis, the euro zone crisis is going to have us all thinking about broader topics than the makeup of the house of commons. >> warner: well, thank you very much for joining us this evening and explaining both. michael elliott and matthew parris and martin walker. thanks. >> brown: and from british
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politics to our own political analysis of shields and brooks-- syndicated columnist mark shields and "new york times" columnist david brooks. so, we just watched the british election dam drama. do you see in i parallels, lessons we should take? >> there are some affects here. the first is deficit. the u.k. deficit situation is not quite as bad as greece but a lot worse than ours and pretty bad. and a fragile government will find it hard to control those deficits. so if you are worried about a global debt crisis this is not good news. the second impact is on the republican party. the republican party and tory party had very similar problems post thatcher and reagan. the republican party has gone in a small government more libertarian direction, the conservative in a more you union tarian. this is broken, whering go to do school its, nurse family partnership, much more centrist and they have actually done quite well. and finally the liberal democrats. the fact that they as michael pointed out did not get the votes suggests to me that if we have a third party, you might get a protest movement in the surveys about that, but people will probably congregate back to the big
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two at the end of the day. >> lehrer: a lot of attention but then migrate back. mark what do you see? >> dwight marrow, the family of ann marrow lynnberg, the united states diplomat said the political party which takes credit for the sunshine should not be surprised when it gets blamed for the rain. and that's what has happened to the labour party in great britain. when the economy is bad, the economy is the only issue. and i think that's certainly the truth here. and i think that's something that we will see in this country in 2010. >> lehrer: that's a good segue to our economy. go back to that discussion i had at the top here that con twution between good job numbers but turmoil in the markets what is the political calculation. >> well, first of all the good job numbers, because unemployment where you spend time and again call it a lagging indicator, whatever else, it is big casino in american politics. that is what american-- that is how they judge prosperity, it is not whether dow jones
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is up 1.5% or down 2.5% it is whether in fact people are working. and this is the best in 49 months, breast number of jobs created, even with the census jobs in there, 231,000 of them i believe were in the private sector. good news, manufacturing, construction. it is funny to watch john boehner say where are the jobs. the republican leader and you want to say to him, john, cheer up, eventually things will get worse. this was good newed,. as far as the markets are concerned, i mean i think, you know, we live in a-- we live in a world that is totally wired not simply economically, but visually. i mean we saw what was happening in greece as it was happening. and we saw the-- attacking it democracy and attacking banks. there is a reality behind it. it is just not the public. there is a real problem. you see it.
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and we are not innocent bystanders to it. the last recession began here. we're seeing something else now. >> so the president comes out today, we saw him earlier and he's talking up the jobs numbers but he has to be very anxious about what he is seeing happening, it might spread. >> he's got to reflect where the country is. and i think the country has probably a pretty good read. what happened yesterday in the markets was just something that happened. but what we are seeing usually at this point after a steep recession, you got some phenomenal growth numbers. you up in the 9, 10%. we are not seeing that. we are seeing 3% and we're seeing good job numbers for the first time so there is clearly a trend upward. nonetheless there is just allots of bad news floating around there and i think the number one weigh on the public's mind politically and markets minds are the debt floating around. the greek debt, the american debt, the u.k. debt that is psychologically weighing everything down. and you see this quick hair trigger panic. i think that is reflective when you talk to people on wall street. it certainly redirect -- >> we heard that from mohamed el-erian talking about the long-term debt here.
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but do you see people focusing in on that now or thinking the jobs numbers are the main place to look and that gives us some positive? >> i think the real question among politician and among the public leadership, i think the answer to, that if something like dave obbey who announced his retirement this week, is that it is a jobs deficit. and we can't-- that is a serious long-term budget deficit and fiscal deficit, we have a debt we have to deal with as a country. but the way we do it is by attacking the jobs deficit which is an income deficit. so i think, you know, that there isn't-- there hasn't been the will. there hasn't been a call for collective sacrifice since ronald reagan was elected president of the united states. and he really began sort of an ouchless, painless prosperity. and it's going to be a new and different message to voters. and it will be interesting to see, i assume the president has to deliver it. and it will be interesting
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to see the reaction. >> that aside, i mean even while that's happening it was a big week for major challenges here for the president and all kinds of leaders. oil spill continues and the fallout from times square. how do you think that's been handled, the times square. >> i think he's doing a pretty good job. people fault president obama for being passionless sometimes, for being a little too cold. but when you have a week like this with the greek situation, the oil spill, you got times squares, you got floods in nashville, i think they responded with reasonable speed. but basically with a level of calmness which is in his nature. which a, didn't make any mistakes. wasn't annoying, no missteps. but was reasonably active in all those spheres so i think this is one of those times when his very calm nature actually serves the nation reasonably well. he is not the central figure in many of these dramas but it is important for the president to be there actively involved. delegated power in the gulf, reacted reasonably calmly to what happened in times square. so i thought this is a good time to have a president
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like obama who is just steady. >> of course a few on thes ago after-- months ago after the christmas day attempted bombinging it was august the talk of the lack of coordination, the lack of information. did it look like the system worked better this time? or were we just lucky or -- >> i think luck is always central whether it's president o, president bush or president clinton. i think whoever the president is, luck is a factor. and the terrorism is not the issue in which thed a mrtion would prefer the spotlight to be. although compared to an oil smile it might-- spill it might be preferred. they have closed the gap, the democrats have and president obama was. what was an enormous disadvantage after 9/11 republicans had a 30% advantage on which party was better to deal with terror. that is now down to 6% advantage for republicans. the president himself has high marks for his handling of terrorism. you see a few things. there was no explosion. there was no loss of life.
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we did get him. but to me we saw a snafu as well. when you have the nypd and fbi both leaking and competing with each other and you can read about it in the paper, that hasn't changed at all. so i mean coordination and cooperation and sharing of information and all the rest of it. but i think you know, we have to find out that the airlines cannot handle the responsibility. the tsa has to step up on foreign flights as well as domestic, the watch list. >> what about this move toward the lone wolf terrorist version of counterterrorism. we talked about it on the show the other night with somebody from the national security council, readjusting, you know, counterterrorism to deal with the people who can come into the country, come out of the country, get an education, get a job. >> get citizenship. >> get citizenship. >> yeah, i'm a little dubious about this. i think that is a false formulation. i know david petraeus used that formulation today. but what's involved here is
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a pretty common, which is you have recently educated affluent people this guy had an mba, who are radicalized. and it's not that they are lone wolves in the way a crazy killer say lone wolf. they are part of an ideaological system. and so it is the same ideaological stming whether it is there or here. so to see them as aly wolf as sky cosis when it is ide ideaology t is a mistake. >> what do you see. >> i think that-- i'm fascinated and miss at this find by somebody-- mystified by somebody who apparently did buy into the american dream. came here, did all the things that one does as an aspiring american, new american. goes to school, gets. mba. married, family. and something clicked. i mean whether, in fact, this was the manchurian candidate three or four years later. the common denominator is the islamic cleric al
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-laki, i guess. but he had that connection and he was sort of the sponsor, the ideaological sponsor, if you would. and spiritual councillor to the doctor at ft. hood to the christmas bomber. and again to shahzad. >> yeah, but there is also a person, the french writer had it years ago which is a lot of these guys including some of the 9/11 guys,, very well educated. they are caught between modernity and a fantasy version of pure islam. and they choose that fachbt see version. >> but we still don't know quite why. >> it is a matter of individual circumstances. >> let me in our last minute or so here, i want to come back to politics. you mentioned david obey. a very powerful figure for a long time. announced he will not run again. what is the significance? >> significance is that david obey was almost unique among political figures in this town. 41 years.
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he was never on the washington d.c.-- circuit. he was grumpy. he was hardworking. he was smarter. he was an amazingly effective legislator. and he was truly remarkable in my judgement in, unlike anybody else. he absolutely meant what he said and said what he meant. and he said the same thing to whoever he was talking to. and he got in fights with presidents of his own party. and leaders of his own party. but he said to me, he said you learn early on in this town that our society is wired. and it's wired to the advantage of those who are privileged. and the one thing public policy can do is give a break to people who aren't privileged and don't have that advantage. and i think his whole career doing it. he will be missed because he was truly one of a kind. >> and of course this announcement play nass this question of how democrats, prospect for democrats. >> they have bad prospects.
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there are not a lot of retirees, there are chunks but not a lot. i agree with everything mark said about david, but i still think he ill-served the country in a crucial respect. obama comes in promises a new style of politics whether that is realistic or not, i'm not sure. but immediately there is a stimulus package that goes through the house of appropriations committee and i remember watching the markup. and david obey was as rude and as ruthless towards the republicans in that committee as frankly republicans had been o democrats when they were in power. and that set us back. >> all right, that will have to be -- >> he wrote the stimulus package and he said it's the unpopular things you do that you are most proud of. and he's proud of what he wrote. >> mark and david, thanks so much . >> warner: again, the major developments of the day: employers added 290,000 jobs in april, the largest hiring increase in four years.
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president obama said he was encouraged by the numbers. but there was continuing market uncertainty both here and in europe. in britain, no political party emerged with a clear mandate to govern after yesterday's election. and a massive containment dome made its way 5,000 feet to the bottom of the gulf of mexico to try and cap the well that's been leaking for 17 days. the newshour is always online. hari sreenivasan, in our newsroom, previews what's there. hari. >> sreenivasan: there's more on today's job numbers. we asked a panel of analysts to weigh in on what the new figures mean for the overall economy. and several of you are watching how many gallons of oil are gushing into the gulf of mexico with our interactive leak meter. explore different estimates of the current flow rate by adding our widget to your web site. and on "art beat," jeff talks to damian kulash of the band ok go about their quirky and popular music videos, and the group's decision to leave its major record label and start one of its own. all that and more is on our web site, jeff. >> brown: and that's the newshour for tonight. i'm jeffrey brown. >> warner: and i'm margaret warner. "washington week" can be seen later this evening on most
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pbs stations. on many of those same stations, you can watch tonight's debut of the new pbs news magazine, "need to know". we'll see you online, and again here monday evening. have a nice weekend. thank you and good night. major funding for the pbs newshour has been provided by:
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and with the ongoing support of these institutions and foundations. and... this program was made possible by the corporation for public broadcasting. and by contributions to your pbs station from viewers like you. thank you. captioning sponsored by macneil/lehrer productions captioned by media access group at wgbh
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