but it was a great labor of love to learn more about them. people often ask me, how did you pick these hundred people? one of the great one of the things the was the most fun about the book was reading about these hundred people. i recently analyst to a 250 people. i contacted friends and others that did not know out of the blue from historians, journalists, like our first, and ask them for their recommendations of people. and then made a point of trying to identify people, some of the more famous and many of whom were not well known. there are three kinds of people in the book and the three categories of people. one group of them are organizers and activists, people like eugene debs and the socialist party, the early 1900 s. people like alice paul, the great suffrage leader it was probably more responsible than anyone else for women getting the right to vote and a leader of the women s suffrage movement in the early 1900 s. she was also an advocate of civil disobedience. she and others which in themselves of the white house fence and get arrested in order to draw attention to the cause for women s rights. up until now, more recently, schneiderman it was an immigrant , one of the leaders of the current workers movement in the union movement in the early 1900 s, particularly after the triangle fire tragedy in new york, there were people who built these great movements for labor, women s rights, a gay-rights, environmentalism, civil-rights, and for peace. the second group of people were politicians and judges. and this is probably the most controversial, because of politician that some point have to make compromises. and so progress of this don t like compromise. we don t like to learn to live with compromise. my view of compromises that some compromises are stepping stones toward greater change. some compromises are part of what progressives need to do to understand the difference between a sellout and a stepping stone when you re compromising. when we were debating the health care bill a couple of years ago in 2010 there was a lot of debate about what moves us forward in what is a sellout. and is really important for us to make that distinction. some politicians are always, always making compromises, but sometimes they re making compromises as allies on behalf of social movements. so the politicians include hiram johnson, the great governor of california who is is possible for the first minimum-wage law, a workmen s compensation law, the first major regulations on the railroad industry, corporations. his counterpart in the 1930 s, radical governor of minnesota. marcantonio, the great congressman from new york who is a protege of someone also in my book, the mayor of new york. and the great paul melson who died more than ten years ago in a tragic airplane crash was a great hero and the principal politician. the great feminist and peace leader who was in congress before that had been involved in the women s rights in peace and civil rights movement as a lawyer. of the 100 people, about 20 of them are people who either ran for office or who were elected for office. of the renter of the ran for office like upton sinclair. almost one on an end poverty in california platform but did not win. eugene debs was never elected to anything. victor berger was a member of congress. and so the library of politicians and the people who are most controversial in my book are theodore roosevelt who was a military stand imperialism but also a strong advocate of labor rights and consumer rights. responsible along with upton sinclair for the passage of the first consumer rights legislation, the meat inspection act of 1906 and the food and drug act of the same year. and some other people who ran for office but did not win. the third category and the one that was sort of the most fun to read about or musicians. everyone from paul robeson and pete seeger who should win the nobel peace price before repasses. we find a way to get him the nobel peace prize. bob dylan, the most recent one is bruce springsteen, riders and playwrights like arthur miller and tunney kirschner it is the author of the film playwright and the author of the film lincoln . photographer like lewis hine, an unknown figure among most americans who is as responsible as anyone for ending child labor by being a great photographer who did incredible documentary photographs of the abuses of children working in factories and mines and other dangerous workplaces. he really held a mirror up to america and said, these are your children. these are the conditions there working in. and the child labor movement really took off with the help of people like jane addams and florence kelley and other people . and the national consumers league, which was a leader of that movement against the child labor. we have sally in the room tonight who is our current leader of the national consumers league. and figures like abraham joshua, the great theologian, wayans wayne coffin to my mentioned dr. seuss, langston hughes, the great negro poet. northwest w.e. dubois who was a sociologist and an academic, but also a propagandist and a writer, most famous for black folks. and people who were in the arts and in the humanities and who inspired us to think about a better world, think about a different kind of society, to think that people organizing together can win victories that make society more livable, make it more humane to make it more democratic. and so we had activists and organizers, politicians and judges, supreme court judges in my book, including thurgood marshall. an activist of civil-rights before it was on the supreme court and then the thinkers, riders, the legends, musicians, and artists. and in coming up with that list i realize that it was going to be controversial. and i have gotten lots of feedback on the book, and there are two kinds of feedbacks that i get. one is, how dare you include that person in your book. did not deserve to be in the book. the other is, how do you leave office person who should be in your book and isn t. so i have to admit, i cheated a little bit. in the intersection to the book their is a list of 50 people who would have put in the book if i have more room. so there s sort of the kind of second-tier or the pinch hitters to would come up to bat if i had more room in the book. and the last part of the book is about the future. the last chapter of the book is called the 21st century so far. i think what is important is to realize that the book is a book of social history and a book about great, heroic figures to change america, who raided a better society. there are people today, probably some people in this room, people who will be watching this on c-span to are the florence kelly s and the walter groups and the martin luther king s and the john lewis s and the myles horton and the upton sinclair s of the 24 century. and so somebody someday is going to write a new edition of this book called the hundred greatest americans of the 21st century. and the last chapter of the book says that it nominates and describe some of the people who are active today in the women s movement, the gay-rights movement, the immigrants rights movement, the labor movement that has had better days but is revitalizing itself as we speak. the movement for a living wages and the movement for environmental justice, fighting the same fights kamal those standing in the shoulders of the people in my book. if there are any lessons from the history of these 100 people and the movement that they represented, i think there are three things that i learned from this from doing this book. number one is the importance of an inside-outside strategy. all progress happens, as frederick douglass once said, when there is protest, there are people in the streets mobilizing, when there are people very great and expressing that anchor not at themselves, not inward through violence, but through non-violence, protests, and activism. but they re also need to be people on the inside it are the allies of these great social movements. and so, franklin roosevelt, a great story is told about african roosevelt had a meeting in the oval office with an activist during the depression. he listened to they re grievances and demands for change and said to them, i agree with everything you just said. no, go out and make me do it. create the conditions and make it easy for progressive liberal allies of yours to pass these laws. i think that is a lesson that obama is learning right now. he learned from the first four years of his presidency where he did not encourage active movements. even during the health care debate. now in his inauguration speech he said, we can do this within the white house. can t do this from just the inside. we need the outside. that s where he was talking about some of the falls and stonewall. we will see whether on the gun-control issue, and grant rights issue, issues for climate change were the movements around the country really build up to a point where president obama would say, like roosevelt, go out and make them do it. the political climate of protest and here that will make it possible. the slauson number one. the second lesson i learned from writing this book is the social change doesn t happen overnight and have the long view. we have to force it to ban further and further. michael harrington, the great socialist writer and activist was my ahoy mentor once the you have to be a long distance runner. you can be a sprinter. the seneca falls convention was in 1848 and they did not get the vote until 1920. victor berger proposed social security in 1911 and it did not pass until a 1930 s. there are people fighting. we don t want to be to patients. too much patients can be paralyzing, we have to realize that the fights continue in that we never win everything now wants and we have to have the long view. the third, we have to be part of the movement. individuals and single issue groups can t when things on the rhone. the thing a learned about the upheaval in my book is a almost all of them are defined with particular issues that it would sell themselves as part of broader movements. the mosaic, the interconnection, the web of all these movements coming together. there is a movement today, an environmental movement, a gay-rights movement. they re all in it together fighting for more social justice she was a founder of the naacp, the founder of the settlement house, a feminist, a pacifist, one of the founders of the women s international league for peace and freedom. a leader of the child welfare movement. .. to make america and the world more humane and more socially just and more democratic. here is my quiz. and i want to and with this. the people in the early 1900s that fought for and believed in the possibility of social security and women s right to vote, civil rights, consumer rights and government protection of workers against unsafe and unhealthy workplaces. they were thinking for the ages. they were thinking beyond their immediate battle but they fought immediate battles of the same time. so for those of you that are here, think about 50 years from now. think about your children or your grandchildren and when they look back, on their society and they think about the ask their granddad or mom or dad, what was life like that when you were my age? you can tell them well, that and we had this but that was considered people fighting for a better world, the things you take for granted back in 2063, 50 years from now, things you take for granted were considered radical ideas way back then in 2013. what are some of those things that your children or grandchildren 50 years from now will look back on and be taking for granted then but will look back on these ideas that today we consider radical? any ideas? i was thinking of that american should have a right to a job and should be able to have to sue the government if the government fails to provide enough jobs enough jobs. so in the year 2063 you believe that we people might take for granted that everyone has a legal right to a job? okay. all right. anyone else? global warming. will we have global warming and 50 years? we are going to have a movement but what was your generation doing when the rest of the environment was going to hell? you did absolutely nothing about it? i think that is this generatiogeneratio n s big issue. they will look at us and say you guys sat around and did nothing about it and we are angry about it. i don t want people to be angry about it. i want them to take for granted in the year 2063 that there ll be an end to global warming so what would that actually mean waxy don t have to answer that but what would it mean for our children or grandchildren 50 years from now to live in a world where global warming is no longer problem but has been addressed and solved by what is happening, by the environmental and other movements between now and then? any other ideas? i remember new zealand being [inaudible] so in the year 2063, it will be kind of like same-sex marriages. people will take it for granted that a woman has a right to an abortion is no longer a controversial issue as opposed to right now where even it s the law of the land we are still trying the right-wing is still trying to fight against it. i don t see any other hands. anyone else? health care. what about health care? everyone will have free health care. universal high-quality comprehensive health care. okay. that is what our grandchildren will take for granted. anything else? everything you buy in the store will have exactly what s in it and they want bna fudging. that consumers will no the products from medicine to food to automobiles if they still have automobiles in the year 2063. anything else? a couple more. [inaudible] incarceration will be replaced by education and mentoring. there ll be an end, so our grandchildren will say daddy, granddad kind of like my kids as me, did you ever used a typewriter? i can t imagine what a typewriter look like and i can imagine what a prison with the like where we stop the prison industrial complex that we have now that so destructive of human lives. anything else? no one will spend more than 30% of their income for housing. housing will be a human right and people will not pay more than one third of their income to afford housing is posted now when people sometimes paid 40, 50 or 60% of their income for housing. one or two more. [inaudible] s. okay so when my grandchildren asked me when you went to college, did you really have to go into debt? that would be a crazy idea. like in many other countries, public higher education would be free and high-quality and people won t have to go into enormous debt to pay for their education. i can think of a few more that i will end with. one is the end of the death penalty. i would like to say to my children or grandchildren when they are older they will look back and say how barbaric it was that back in the year 2013 they still use the death penalty although it is true carol still have the death penalty and one that often comes up when i asked this question, some people wonder whether there will be, whether we will still have automobiles. whether there will be other forms of public transportation as both a condition of changing the way we move in our cities but also changing the problems of global warming. so, all of these things and many others are today considered radical ideas that are outside the box, that are considered, many people would say that s an impractical idea. that s unlikely to happen but that s exactly what jane addams, lawrence kelly and john lewis and opeb dubois and many other people in my book when they had these ideas including victor berger when he introduced social security and old age security, they thought they were crazy. they thought they were impractical. so the lesson i take away from doing this research which is really a labor of love is the radical ideas of one generation are often the common sense of the subsequent generations and of the next generations but it doesn t happen inevitably. there has to be movements for justice and people have to fight the fight and they have to engage. they have to get off their buts and be part of the social movement. that is the case the martin luther king idea, the arc of history towards justice, we will have a new generation of park vendors who will move the society in a more democratic direction. my book is really about the great heroes of the 20th century and some of the ones that are today in a 21st century move the country in that direction and i m sure that many the the of the people in the room today watching on c-span were part of that movement and it s a great tradition to be part of. i hope that whether or not you buy the book if you were in that history on people whose shoulders we stand because our democracy really depends on it. thank you very much. [applause] before 1990 american were controlled gulf waters but had little presence in the ground following the iranian revolution of 1979 and lebanon 10 years later. washington held a limited defense at rhee with a rain but no one else. there were for example no u.s. troops in saudi arabia in 1990 are any in that kingdom or kuwait. in fact on the eve of the iraqi invasion but tensions grew american policymakers staged the idea that perhaps this will be a good time for joint military. let s show saddam we were in this together this together. about the gulf states only one, the united arab emirates even agreed to the limited demonstration of solidarity. they feared more than saddam a public backlash from cavorting with what the iranians routinely called the great great state and in fact is saddam hussein directly told the united states ambassador before the invasion quote, he felt secure, secure in the belief that no arab government would ever allow the united states to lose to use their land for that purpose. defending kuwait. why was he so secure in his belief? well for two reasons. first because of his few muslim states that reject american troops on their soil and second because in practical terms no one had ever done so since 1979. of course the shah of iran had but that was not a model that other arab leaders wish to follow. saddam therefore believe that muslim states would reject direct american aid and more specifically the station of american troops on their soil. in retrospect there were strategic miscalculation but it was hardly an irrational one. for america to influence the persian gulf was offshore rather than on site. this was not the 30th parallel in korea. this was not the gap in germany. where american church or station directly in harm s way as tripwires american resolve. on the contrary american policymakers for decades at this point have long hoped to influence the gulf and keep its oil flowing with as little direct involvement as possible so long as the soviets didn t interfere in the region themselves president carter declared in 1980, so long as the iranians didn t stop the gulf president reagan declared a few years later american planters were by and large contested. ultimately didn t matter as long as it will continue to flow in this is the bush administration s first line as well. in unseating the fact a year before saddam s invasion ,-com,-com ma enunciated in the latter part of 1989 and national security directive 26 which laid out the full scope and rationale of american involvement in the region. this document which you can get in the archive if you would like does not use the word freedom. it does not use the word democracy. it does not mention particular leaders and it doesn t talk about regime types are radical islam and it certainly doesn t mention wmd. it says instead quote access to persian gulf oil is vital to national security interests. period. memories of hostages in iran destroyed erikson beirut is reason enough to be wary and this context matters to understand the widespread american reluctance to do more in response to iraqi s vision. to not threaten that long range destruction of oil. moreover the middle east was not particularly an appealing place for those american politics in the sense of short medium and long-term history. take told secretary of state james baker who had advised presidents for decades or for years but more importantly among his closest friends for decades. he was secretary of state and upon hearing this news contemplating it and getting back to washington, he told the president in the oval office, close the door and told him quote i know you are aware of the fact that this has all the ingredients that is brought down three of the last five presidents, a hostage crisis, body bags and a full-fledged economic recession caused by 40-dollar oil and quote. indeed, we need recall that bush s decision to move american troops to the gulf was hardly embraced across the board in american politics. at the same time we should call curt congressional opposition to the war was far from being partisan. it was was conducted rather a richer sense of concern. concern. as senate majority leader george mitchell argued the risk of active american intervention is great. he said quote using an unknown number of casualties at this billions of dollars spent a greatly disrupted supply in oil price increases of war possibly widen to israel turkey or other allies, the possible long-term occupation of iraq increasing s instability in the gulf region long-lasting arab and american embassies and and a possible return to american isolationism end quote. looking back on mitchell s mornings we can see that few of those things occurred in in the immediate aftermath of the persian gulf war but arguably all of mitchell s fears untold casualties, billions of dollars lost disrupted markets disaffected allies ever american hostility and isolationism all returned to haunt the united states. can watch this and other programs on line at booktv.org. in bad history, worse policy peter wallison takes a critical look at the dodd-frank wall street reform and consumer protection act and argues that it is based on a false nerd of what led to the 2008 economic collapse. he spoke about his book at the american enterprise institute in washington d.c.. this is just over 90 minutes. ladies and gentlemen, welcome to our discussion of my distinguished colleague peter wallison s netbook, bad history, worse policy . let s start with a quotation. quote this legislation will safeguard and stabilize america s financial system and put in place permanent reforms so these problems will never happen again. will never happen again, a quote from then-president h.w. bush and 1989 after the passage of the financial institutions reform recovery and enforcement act. president bushes prediction was of course a very bad one as we know and needless to say similar and no doubt equally bad predictions have been made about the effects of the dodd-frank act which we will be discussing today. the predictions highlight a predictable cycle in the wake of a financial crisis. there is an inevitable political reaction based on political not necessarily economic or financial logic and the political logic goes something like this. i is a politician must do something. what can i possibly do? well i can always expand and reorganize regulatory yurocko sees, even if viewed over time it doesn t work or indeed is perverse to do so. a famous military cause of fix talked about the fog of war and the financial crisis. we have the fog of the crisis followed by the fog of legislation. but it s even worse in the voluminous legislation not only reflects the fog but is based on a wrong idea, a faulty understanding or as peter persuasively argues, a flawed ideological narrative. peter wallison is the arthur byrnes fellow on financial policy studies at aei and his latest insightful book entitled bad history, worse policy how a false narrative about the financial crisis led to the dodd-frank act is what we are here to discuss. in addition, to these constant flow of instructed commentary on financial issues and regulations, peter is also the author of ronald reagan, the power of conviction and the success of his presidency. a great look which should be read by every student of competitive equity. a better way to organize mutual funds, privatizing fannie mae freddie mac and the home loan banks. we are still working on that one. the gap gap and optional chartering regulation of insurance companies. here is our book. i hope you read this whole book, but in case you are intimidated by the thickness of it, please send in any case read the closing chapter on the burdens and blunders of the dodd-frank act. it is a succinct and compelling case for the prosecution with dodd-frank in the dock, to which the jury of time will surely respond guilty and the judge pronounced sentence, spring string him up. peter will present his book and in 25 minutes we will have three expert discussions who i will only introduce after peter s remarks and we will give peter a chance to respond and some discussion among the panel and then we ll open the floor to your questions. at at 11:45 unless we run out of questions sooner we will adjourn to a coffee reception. copies of peter s books are available at no cost. should we run out and you don t have one yet you can sign up to get a free copy and he will be glad to sign books during the reception. thanks to you all for being with us today and peter looking forward to your comments. thanks an awful lot, alex. the reason for the free books, i thought i might explain this. this book was written with a grand which we received a generous grant to publish my financial services outlooks, the ones i have written over period of eight years. and when it was published we learned that the active publisher had placed a very high price on the book of $90. i generally refused to speak at a conference to sell above for $90. it s not worth it. but, we thought well okay we can buy the books from the printer as part of our arrangement and then we can buy them for much less so we might as well give them away. we did not advertise that the free books were going to be given away today because i was afraid that would draw a crowd. i am happy to see that actually people came not knowing that so i appreciate all of that. thank you. now that history bad history, worse policy makes a simple point. that every major public policy is based on a narrative, a description of how at problem came about and what changes are necessary to resolve it or prevent a recurrence. in cases involving major national issues, there is a debate usually about the substance of the narrative in which differing views are heard and evaluated. an example of this process is the current debate about whether human activity is causing global warming. there is an ongoing controversy about the facts in which each side understands but disputes the arguments of the other. eventually a decision will be made. not everybody will be reconciled but everyone who wanted to have a chance to speak or to express an opinion will have had that opportunity. other examples that are a similar process of resolution or immigration, gun control and entitlement spending. in these cases the issues have been joined and in the debate will eventually produce an outcome. the abortion issue as an example of what happens when this process is not followed. they are, the matter was decided by the supreme court or for any kind of public debate and the result has been continuing turmoil and even violence. in the book, i argued that there was never any significant debate about the causes of the 2008 financial crisis. although there were two narratives about why it happened, only one of them was accepted and propagated by the media. in effect the necessary competition and ideas never occurred. as a result in the policy that was adopted, the dodd-frank act, is not soundly based on any political consensus. this will leave the village is made of the act in question for the foreseeable future. the dodd-frank act is based on a narrative developed entirely by the left in places responsibility for the financial crisis wholly-owned the private sector and particularly on the large wall street commercial and investment banks. to the extent the government had in the world in the financial crisis it was in failing to regulate adequately either those institutions or the mortgage originators who profited by selling mortgages to people who could not afford them. the book traces the influence of this narrative into the specific revisions of the dodd-frank act. i argue in the book that this narrative is false. it was bad history and it produced worse policy. it is certainly true that the private sector had some role in the financial crisis but this was relatively minor when compared to the government s effort throughout the clinton and in part of the bush administration to degrade mortgage standards in order to increase homeownership. this contrary view was never put before the american people in time for its implications to be considered in the debate over dodd-frank. if that debate had occurred, it s unlikely that the dodd-frank act would have been enacted in anything like its current form. now why did this debate not occur? why it was there no competition in ideas on this matter? that is what i will largely talk about today. for those not familiar with the argument that than financial crisis was caused by government policy, but the state is as succinctly as i can. before 1992, the vast majority of mortgages in the united states were prime mortgages with down payments of 10 to 20% and made to people with good credit records. fannie mae and freddie mac were the principle enforcers of these rules, delinquencies and defaults were few. in 1992, congress adopted legislation that required fannie and freddie to meet what we will call a affordable housing goals. the legislation initially required that at least 30% of the mortgages fannie and freddie made had to be made to people who were at or below the median income in the places where they lived. the hunt was given the authority to increase the quota and it did so, raising the quota to 50% by the end of the clinton administration and 255% and the bush administration. statements by hunt throughout this period make clear that the agency s intention was to reduce the underwriting standards that were prevailing in the market in order to make mortgage credit available to a larger number of our worst. there is no ambiguity about this issue. it was difficult for fannie and freddie to find prime quality mortgages among borrowers who were at or below the median income especially when the quota had been raised to 50%. so in the mid-1990s they began to reduce their underwriting standards, accepting 3% down payment by 1995 and zero down payments by the year 2000, acceptable barro fico scores credit scores were also reduced. because fannie and freddie were the dominant players in largely set the standards for the housing and mortgage market, these lower underwriting requirements spread throughout the market, not just to those mortgages that qualified for the affordable housing goals. the availability of government support for low quality mortgages and the easy availability of mortgage credit substantially increased demand for housing and build an enormous bubble, nine times larger than any previous bubble between 1997 and 2007. by 2008, half of all mortgages in this bubble, that was 28 million mortgages, were sub prime or otherwise low-quality. of these, three quarters were on the books of government agencies such as fha or other entities controlled by the government such as fannie and freddie. this shows in controverted way in my view where demand for these loans came from and why these mortgages proliferated. when the bubble finally deflated in 2007 and 2008, these loans defaulted in unprecedented numbers driving down housing values and weakening financial institutions in the u.s. and around the world. when lehman brothers collapsed, a financial panic ensued with banks and other financial institutions hoarding cash and refusing to lend to each other, and that was what we know as the financial crisis. it s not as though these facts were unknown or unknowable. fannie and freddie were two of the largest financial institutions in the world and were taken over by the government before lehman brothers failed. you don t become insolvent by acquiring and guaranteeing prime mortgages. included in this book is an essay by charlie, professor at columbia and you probably all know him that he and i wrote in september of 2008, the same month that lehman failed. outlining fannie and freddie s role in the crisis. .. you can and show come and i were once accused in the new york column he and his of using the big lie technique for suggesting that the government had a major role in a financial crisis. it doesn t get much worse than being compared to joseph. [laughter] most americans have no idea that there is an alternative view of what caused the financial crisis. the result is an odd issue on public discourse. when i m interviewed about financial crisis is, i am also asked why no bankers have been served personally or tried criminally duty causing the crisis. i usually respond by saying that i don t think that they have actually caused the crisis. this appears to interviewers to leave the interviewers dumbfounded. they have no frame of reference with which to interpret this response. i then have to explain my views about what were the actual causes of the financial crisis, and they and other listeners have to take it in comments rather, it s rather complicated description of an event that in many cases they have heard for the first time. this would not happen, for example, in an interview about climate change. if i were asked whether the u.s. should reduce reliance on climate change, many would understand that there are two views of the subject. those who believe human activity is causing climate change, and those who are skeptical about it. before we take steps that will hinder economic growth, most listeners will understand the views underlying my remarks. even if they disagree. it occurs the narrative that if we reduce fossil fuel at use, we will suppress economic growth. however, because most americans have not heard anything about an alternative explanation for the financial crisis, they have no frame of reference court other than the disaster that caused that was caused by the wall street banks. when we have this, public knowledge that one of the significant economic events? there has been a major flaw and the reasons are not hard to discern. it is no secret that the media is dominated by the left. the left has always had suspicions about capitalism as an economic system. not only is capitalism regarded as darwinian, an enemy of equality, it is also seen as inherently unstable and prone to crashes. that is why immediately after the default and result in chaos, this is why people said it was the end of capitalism. it has revealed itself as too dangerous to be able to function without from government control. the fact that the default ensuing chaos agreed so completely with the last view of the u.s. economic system allowed many on the left and the media to view it as a confirmation of something that they had always believed and not a debatable issue. other explanations or were dealey tory and a waste of time. and it also served the interests of another group with a loud voice in the subject, the national regulators. we are familiar with the fact that regulators, and alex was talking about this before, they get more power when they fail. i won t go into a to be things meme, because many of you have studied banking and financial law will know it. each was a new set of powers for regulators who had recently failed. in the case of the financial crisis come in the national regulators were quick on the crisis coming. they fought for power is coming to be an uber regulator with a potential eventually to regulate large insurance companies, finance companies, hedge funds and money market mutual funds as well as banks. if you read the speeches from those around the world, they easily can get control of the securities market. the codewords are shadow banking. it is a result of a sufficient supplier of funds to the real economy of banks. it is simply less costly to sell bonds and notes and commercial paper to investors than to borrow from a bank. since the mid-1980s, by intermediating these transactions, the securities industries has supplied 15 times more financing to the real economy than banking. and it has done so without government regulation. bear stearns, lehman brothers, heavily regulated banks whitelock cobia and washington mutual. so it is hard to see that more regulation is the answer. what we are watching in the name of prudential regulation is the government gradually squeezing the life out of the banking industry the way the interstate commerce commission squeezes the life out of the railroad. if we let the government insurer and provide regulation to the securities business and some regulators have proposed, we will pay a heavy price in lost economic growth. finally, even natural supporters and members of the financial industry were shaken by the crisis and slow to resist the tide of commentary within the media. without an alternative explanation of what happened, other institutions had to admit that they did many of the things that were now being cited as the cause of the crisis. these confessions came because although they had no idea that they had securitized subprime mortgages, the government had done the same thing with three times as many. that was not reported in the media. without this information, it was possible the private actions could have been responsible for the financial crisis that they saw all around him. a good example of this phenomenon is the chief investment officer at jpmorgan chase. he circulates a newsletter to friends and clients, and in 2009, he used it to plain banks like his own for making irresponsible and risky mortgage underwriting decisions of ron the financial crisis. this was to be expected. the only information he had was what he has read in the newspapers or saw on television. he did not know what the government rule have been. one day he ran across the majority report of the financial crisis commission, to which i argued that it it was the government s housing policy, and the affordable housing requirements that were imposed on fannie mae and freddie mac that drove down standards and built an enormous bubble and caused the financial crisis. he then looked further at the data assembled by ed pinto and concluded that he had been wrong. it is not the jpmorgan had not done the things that he had initially sided. it is just that the contributions of the banks were only a small part of a larger picture. once he was aware of the larger picture, he used his newsletter to issue a retraction of his earlier judgment. with the regulatory apparatus all coming from the same instance. the very few people were willing to question the claim that the financial crisis was not caused excuse me, was caused by the private sector. even if there were voices in defense of capitalism, their views were seldom given attention in the media. i had a remarkable experience with this problem will member of the financial crisis inquiry commission scheduled several public hearings which were televised on c-span. the media was almost always present, overarching the proceeds on television. i asked witnesses whether or not they were aware that there were 25 million on subprime and other low-quality mortgages in the financial system in 2008 for the financial crisis. that was the number that i had at the time. since then, it has shown that there were 28 million in private mortgages in 2008. all the witnesses who were asked this, they were people that should have known, and they said that they should have heard of such a thing. again, almost half of all mortgages was news. it had never been reported before, and it is a shocking thing. and i never recall a call from a reporter asking me where i have come up with a number. publication would have led to questions immediately about how so many of these mortgages got into the financial system in the first place and where they were located. i would have been able to show that only a minority of these on banks or other private financial institutions. and that most of them on the books of government agencies. yet my statement never evoked the slightest media interest, and of course, was never covered in the report. at the time the report was published, i issued a 43,000 word information, showing that this had caused the crisis. the substance of the defense got no more than one sentence in any major newspaper and was not covered at all in any of the major broadcast or cable media. only fox news interviewed me about my view of the financial crisis, and that was part of a program that to the credit of fox, included a lot of material that also pointed to private sector responsibility. i was never interviewed about my words on the other channels and pbs news hour. despite the fact that the same data i had included had persuaded republican senators and members of congress to vote virtually unanimously against the dodd-frank act. it is no wonder that the american people still believe that the banks and other financial institutions were the sole cause of the financial crisis. there still has been no competition in ideas. if it does nothing else it s collected essays, but that history and policy shows that from the beginning there was a competitive and competing narratives, before the opening bell had sounded, the referee had declared a winner. thank you very much for your attention. [applause] [applause] thank you, peter. i have three expert people who are going to it discussed this book in various ways. let me introduce them. the first will be john allison who is president and ceo of the cato institute. before that he was chairman and ceo of the 10th largest u.s. financial services holding company, which during his two decades in tenure as ceo grew from $4 billion to $152 billion in assets. he has been recognized by the harvard business review is one of the top 100 most successful ceos in the world over the last decade. he also serves on the board of visitors at wake forest university, duke university, and the university of north carolina at chapel hill. the second discussion is hester peirce. she served as a senior counsel to the staff of richard shelby on the senate banking committee. has counseled to commissioner paul atkins at the securities and exchange commission and is a staff attorney in the sec. and she has recently released a working paper on the lack of economic analysis by regulators who are entrusted by implementing the dodd-frank act. finally we were here from wayne abernathy, whose financial institutions, policy, and regulatory affairs at the american bankers association, exists where he oversees policy development, and general counsels, securities and investments, and risk management he was previously secretary of the treasury for financial institutions and a member of the board and staff director of the senate banking committee. needless to say, he was not staff director when dodd-frank was enacted. we are looking forward to all of your comments. i yield the floor. good afternoon, it is a pleasure to be with you. i want to begin by congratulating what i think is an outstanding book. i think the theme is very important. he has done an unbelievable job of creating a mass. the bank industry was not deregulated, we had a massive increase under george bush, the privacy act and the whole idea that there was greeted on wall street, there has always been great on wall street. but there is no evidence that there has been more greek than usual. i must acknowledge the real debt to peter and to alex and add. i also wrote a book about the financial market and i use a lot of information that peter had given in my book and i open it up for that because he s the one person that has seriously put together the numbers that we have needed. his work has been very valuable to me. i very much agree with the arguments presented in these individual papers. reading the book is easy for me because i already read his papers. i did so when i was running this and they helped me make good decisions. we intuitively knew something was brewing, but it was helpful to have facts to encourage us not to do the kind of things that got others in trouble. my company did do better than others in the united states for a variety of reasons. but one reason is the argument that peter was presenting that was influencing and reinforcing what we knew was not good. some of these things are particularly important. the role of the housing policy going back a long time, particularly in the 1990s, and the impact on the economy. the role of freddie mac and fannie mae along with the community reinvestment act and some things that are nontrivial but that are academic. things like tell fair value accounting and the shadow banking system. there is nothing shadowy about it. this created things one by one. he also talks about the role of regulators and that it is destructive nation. very negative causes. in all of these things, i think that his work is very important. if you think about the fact that he was writing this while this was happening, in many cases you can see him projecting where we were going. in every case it turns out to be true, which i think makes a much more powerful argument. when you do this kind of feedback, you talk about where you would differ with peter. i don t know that i differ, but my own belief is that the fundamental cause of the financial crisis were errors made by the federal reserve. we don t have a private monetary system in the united states, a government own monetary system. by definition, they are caused by government policy and the federal reserve has been very creative and in this case allen greenspan made bad mistakes because he wanted to go out a hero. we were having a minor economic correction, he created negative economic rates. then ben bernanke created a new yield curve, because we suddenly had a negative spread, which is a whopping reason this has lasted several years. the context in which the mistakes were made were really federal reserve policies and they got deflected primarily in the housing market, specifically fannie mae and freddie freddie mac and fannie mae. it was destructive for housing and consumption. people don t think about it, but if you consume it and a massive overconsumption, which is one reason we have had such a hard time getting the production process going again. we have taught millions of people how to the mortgage bankers and learn new jobs. this housing, investment, the federal monetary reserve problems is particularly destructive from an economic perspective. the other thing, i don t know that we disagree on this because is because peter doesn t talk about this, but i guess i am for a more radical solution. i do not believe that it is naïve to believe the risk being created by the system itself. it is not big banks. it s the federal reserve. what they are doing today is incredibly real to our economy. if the federal reserve is leveraging itself, then the system is risky. it is riskier today than it was in crisis. if the individual institutions cannot manage risk, i am for using market-based standard. if we aren t doing that, my own recommendation is that a least a step we could take is to require banks to have more capital than they do today as they did when we had a private banking system. and then kill 95% of the regulations, including 100% of dodd-frank, let the market take care of allegations of capital. i think we will get a better solution than what we are working on today. it is hard for the average person to realize the banking system is very much controlled by the government today. if you want to control the allocation of capital and if you can put do it if things don t get blown up, this is what has happened with subprime lending. then they can blame the banks when it doesn t work. it is more powerful in a much more interesting solution. the reason why the left jumped on this issue is because it gives them justification. they had so much fear about any attack on us. they really depend on this matter. anytime you bring up an alternative solution, it s not that they just argue with you, they get emotional because if you undermine this, everything that has happened since this crisis doesn t make any sense. it is a real threat. they really want control of the system. but this is a big and important issue because controlling capital controls and economy. i would congratulate peter on a job well done. thank you. [applause] hester peirce? thank you, john allison, thank you for the chance to discuss this. it differs from dodd-frank in several ways. one is well-written. [laughter] one is argued and one does not attempt to deal with what is unrelated to the issues at hand. but there are some similarities in dodd-frank. i would catalyze them both as tearjerkers, meaning that they make me cry at the state of our financial regulations. the third similarity is that neither of them would have been britain or put together if we had just listened to peter earlier. he was one of the first voices and people to really shine a light on the gse. as he points out, it was so essential to crisis. in the book he talks about the rise and the power that they exerted, the ability that they had to shut voices down. and then the attempt to stave off the political consequences of that. he talked about the early republican senate efforts in the bush administration efforts to rein in the gse and he talked about the situation now where the gse s were not dealt with in dodd-frank. in fact, they took under the private securitization market and we end up with a much more heavily concentrated government presents with fha being the next bailout candidate and the market is unable to restart. i think it lays out a model for what we will see what the future that dodd-frank has created for us, the gse in dodd-frank is systemically important, which include any additional entities that the financial stability oversight council designates. institutions will have an implicit guarantee from the government. they will be in partnership with the government. the government will tell them what to do. they will respond. as peter points out, this will lead to a funding advantage that will then drive competitors out of the market. regulators will have a real incentive to come in and rescue them. the failure of one of these entities would reflect failure of the regulators. ..
one else has ever done before, find a new way for humanity. ty, but it was also kind of a stagnant time in terms of spiritual growth. things were kind of at a standstill. the baseline culture was materialism, and also the feeling that the culture itself didn t honor the human spirit and didn t honor creativity. the early 1950s, the nation recognized in its midst the social movement called b generation. a novel titled on the road became a best-seller. when kerouac s book came out, it became a revolution, defined a new generation of what being beat means, and it defined it as a spiritual revolution. that if we re living in an age of conformity, if everybody s trying to work for the corporation, that you re losing a sense of self. i was traveling west one time at the junction of the state line of colorado. i saw in the clouds huge and massed above the golden desert of even fall, the great image of god with four fingers pointed straight at me. come on, boy, go thou across the grown, go moan for man. go moan, go groan, go groan alone, go roll your bones alone. [ applause ] jack kerouac became like a godfather for counterculture. the village has a life and language all its own. if you dig it, you re hip. if you don t, man, you re square. coffey houses, the neighborhood bars of bohemia, where the strongest potion is coffee, and the coffee house poet is the speciality of the house. to find a place where the eyes can rest. beatniks, they had these coffeehouses they would go in and play chess and read poetry, and those same coffeehouses became kind of a proving ground for folk singers. all young kids were running out to buy guitars and banjos. folk music gives me a lot more than the popular music of our own time does. popular songs should be sung because we don t do anything about say the bomb, you know. the whole situation come to an end. there s got to be an alternative to whatever ways of life are offered to them, you know? i mean, democrat, republican. and i would like to offer some kind of alternative, somehow, you know? folk revival scene had a big part of politics. you can t get left politics out of woody guthrie or pete seeger. so the greenwich village movement was there to celebrate people s culture. if you like the music, you were really signing on for their ways of looking at the world, too. and then, eventually, one guy emerges as being special. a bullet from the back of a bush took medgar evers blood during that time in the 60s, as that cultural revolution was slowly bubbling and kids were starting to question authority, question what was happening in their country, they re looking for answers. bob dylan thought that folk music was poetry. he took beat energy and mixed it with folk culture, and it s more lyrical intensity than anybody s put to song before. and the negro s name is used, it is plain for the politician s gain as he rises to fame up until the time of bob dylan, there were the songwriters and there were the singers. dylan started writing his own music. he says, i am going to comment on the world, i m going to comment on the nature of this human experience. bob dylan was sort of in this white-hot moment of saying more in the popular song than anyone ever had before. only a pawn in their game [ cheers and applause ] after the revolution of bob dylan, the music world moves west. got to go where you wanna go, do what you wanna do with whoever you wanna do royal canyon becomes the epicenter of the rock revolution. the music scene was not happening in new york anymore. it was now l.a. everybody moved to laurel canyon. actors, musicians, artists, and so it was a kind of whole community, very open. if you were driving over laurel canyon and you saw somebody hitchhiking, you d just automatically pull over. hey, brother, get in, you know? where are you going? laurel canyon was an incredibly interesting place to live in those days. i lived on lookout mountain with joanie mitchell. crosby was close, stephen was close. now it was all these artists singing this truth, and their truth was this idyllic sense of freedom. there was a thriving community of kids that were discovering their new life and couldn t wait to play the new song they had written. it was a lot of freedom. there was a lot of drugs. this was a lot of beautiful women. there was a lot of good rock and roll being made. it was a fabulous time. ah. 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ken keasey took classes of writing at stanford university, and he writes the great novel one flew over the cuckoo s nest, and this makes him a celebrity. while i was at stanford, i was given the opportunity to go to the stanford hospital and take part in the lsd experiments. keasey had volunteered to do tests for lsd, a government-sponsored test. lsd was isolated in a pharmaceutical company in switzerland. are you happy? yes. you have tears in your eyes. oh. is that a beautiful experience would you say? i would say yes. some people think it s when keasey discovers lsd that the counterculture in california is born, because more and more people then want to try to experience what keasey experienced, and he becomes a promoter of it. keasey created a drug commune at la honda, which is an hour from san francisco. great artists love smashing traditions, and at his best, keasey was doing that. everybody would have this communal lsd trip together. tom wolf would write the electric kool-aid acid test about it. people were constantly slipping drugs into my food. i d wonder what happened. they thought they were doing me a favor. they were having the world s fair in new york, so a bunch of us were going to do. but the bunch of us were too big to fit in his station wagon, so he bought this converted school bus. keasey, he was going to put the bus in dayglow, bright colors and then go with what he called unsettling america, blowing people s minds. the whole idea of blowing people s minds, you have to present something that is so different, there s a crack comes open where something new can come in. and the reaction to all these people was wonderful, because what it was in 1964, there was no other thing like this happening. it s part of a kind of cultural revolution going on, making the squares pay notice to this underground of america. when we got to new york city, which is the home of the beats, where kerouac lived, and picked him up, because we were in his presence, we were just acting as goofy as we could, playing music, putting on costumes, doing all kinds of acts and stuff like that. and then kerouac sat on the couch, we would get a big, tall budweiser. he was obviously not an enthusiastic guy. those beats, they had done their thing, you know? i are i really felt like the torch had been passed from those guys to the psychedelic generation. keasey was very messianic, and thought he wanted to get as many people to try lsd as they can. so we started renting halls. we called the thing the acid test. the band of course was known as the warlocks. as time went on, they changed their name to the grateful dead. st. stephen with a rose, in and out of the garden he goes country garden in the wind and the rain wherever he goes, the people all complain lsd was not an illegal drug. when keasey held these acid tests, as they were known, they d have two vats. one was punch and one was punch with lsd. the acid tests were like a party. the scene is a lot of light shows and music and people dancing. when the dead were playing, it was a way to feel that acid in waves. and i looked down and i saw kids in front of me moving to the music. they looked up at me and i said, yeah. the drug culture really took hold. and that s where artists, whether it was the grateful dead or jefferson airplane, were able to embrace it and put it in their music. the counterculture in california is born because more and more people want to try to experience what keasey experienced, and he kind of became the grand poobah of the carnival in san francisco in the 1960s. there s nothing a grown-up or sophisticated in taking an lsd trip at all. they re just being complete fools. ? 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[ chuckle ] you wouldn t expect an insurance company to show you their rates and their competitors rates but that s precisely what we do. going up! nope, coming down. and if you switch to progressive today you could save an average of over 500 bucks. stop it. so call me today at the number below. or is it above? dismount! oh, and he sticks the landing! if you misplaced your discover card you can now use freeze it to prevent new purchases on your account in seconds. and once you find it you can switch it right on again. you re back! freeze it, only from discover. get it at discover.com. cbs news, without any flowers in its hair, is in san francisco because this city has gained the reputation of being the hippie capital of the world. i got accepted in san francisco state and i found an apartment at haight and clayton street, right in the center of what would become the haight-ashbury. the psychedelic shop on haight street started about a year ago. it spreads the gospel based on brotherhood, love and lsd. for all the people out there hungry for meaningful spiritual life, that s why all these people are down here. that s why there s so much interest in the haight-ashbury. it offers hope. we lived right down the street from the psychedelic shop. people were growing their hair long, they were wearing beads, playing music on the street. it was just an incredible environment at that point, in the beginning. that s when it was just like one big, giant family. before you knew it, it was a congregating place for artists, and the dividing line seemed to be the psychedelic experience. you couldn t understand the posters, you couldn t understand the fashions, you couldn t understand anything if you hadn t gotten high. the diggers group scrounges food and money to feed free those who arrive in panhandle park with a bowl and an appetite. diggers are people who share, says their manifesto, and their aim is a society where everything is shared, everything free. the diggers were one of the first groups into social consciousness about what was needed to take care of this huge group of people that were coming into the haight-ashbury. their free shop looks more like a playground at first sight. here they make sheets and clothes for other hippies, who can come and take what they want without paying anything for it. everything in the store was free tools, clothing, televisions. so we were inviting people to imagine a way of life that would please them, and then to make it real by doing it. what we re thinking about is a peaceful planet. we re not thinking about anything else. we re not thinking about any power, we re not thinking of any of those kinds of struggles. we re not thinking of revolution or war or any of that. that s not what we want. nobody wants to get hurt, nobody wants to hurt anybody. we would all like to be able to live an uncluttered life, a simple life, a good life and think about moving the whole human race ahead a step or a few steps. we wanted to learn more about the real meaning of life, why are we here? certainly not to kill each other but here to celebrate life, to make music, to do art and love each other. these people are hippies. they represent a new form of social rebellion. it is hard to figure out what positive things they are in favor of. the reason we can no longer identify with the kinds of activities that the older generation are engaged in is because those activities are for us meaningless. they have led to a monstrous war in vietnam for example. we did want change from war, from rigid ideas of what the sexes ought to be doing. a change from black people ought to be here and white people ought to be here. no. why can t we try and make that work? the haight-ashbury community has created a council for a summer of love in san francisco. the council is calling for creative love happenings for every weekend throughout the summer. we ask all who come here to come here in love and we ask all who live here to greet all men with love. they at their best are trying for a kind of group sainthood, and saints running in groups are likely ludicrous. they depend on hallucination for their philosophy. this is not a new idea and it s never worked. it was sort of a divide of generations. a lot of mistrust. young people didn t trust old people. old people didn t understand young people. what s so offensive about long hair? it looks sloppy. [ laughter ] [ applause ] it doesn t differentiate the boys from the girls enough. we didn t call ourselves hippies. the hippies are a fabrication. they were an attempt to diminish young adults and infantalize us, and it certainly serves to exclude the people that were deeply thoughtful about the world, that were ready to dedicate their lives to making change and had questioned the paradigm of materialism. look around you. nothing works. the only thing a kid is presented with is when you grow up, you can join the army, go to war, get a gig as an engineer, become a vegetable, drive to work in your own car. your own, big, metal box. and it just looks absurd, people in their metal boxes like this going all over from job to job, frustrated, uptight. what joy is there in life? life should be life is and should be ecstasy. the counterculture had the arrogance to tell everybody else what they were doing is wrong. and nobody likes that. it s estimated that anywhere from 10,000 to 200,000 youngsters may pour into haight-ashbury this summer. many people are apprehensive. they feel that black power or other political activist groups may use haight street as a stage setting for riots. haight-ashbury cannot handle 100,000. of course, there isn t room. the tension between the government and the people began to be evident. supervised to become a part of a group such as that. they re fascists as far as i m concerned, and they don t like hippies and they don t like the things we do and they try to harass us and bother us. in some ways, their revolutions are war between generations. the hippies rallying cry is never trust anyone over 30. the war cry of the youth establishment is on full swing on about every front. about four policemen came in and said everybody get out, the store is closed. they wouldn t give a reason or identify under what premise they were doing this. when we asked them, they pushed people around. they pushed people physically out of the store. the mayor, this is very insidious, what he s up to. he wants to stop human growth. the hippie leaders say all will be well. flower power will prevail. they say it will be a summer of love, a great pilgrimage. hopefully, they ll be right. if it s necessary to bring in national guard, i ll bring in national guard. i ll use whatever force is necessary. fresher dentures. .for those breathless moments. hug loud, live loud, polident. can a business have a mind? a subconscious. a knack for predicting the future. reflexes faster than the speed of thought. can a business have a spirit? can a business have a soul? can a business be.alive? we now seem to be witnessing in this country and elsewhere an intense preoccupation with the pursuit of pleasure. call it hedonism, call it self-gratification, call it what you will, you cannot avoid noticing it. you may not like it, you may not accept it, but you cannot ignore it, a change in morality. eight miles high turn on, tune in, drop out. i ve spent some time in new york and i ve spent some time in london, and i m here to tell you, it s happening all over! in any large city, there were other haight-ashburys, which people could point to. see, we re on the map, we re big, and we re far more interesting than what you all have to offer. how do you answer the questions of parents who are concerned about the use of lsd and marijuana for their children? these are young people who are hungering for older people, for their parents to listen to them. these youngsters want to share with their parents the grandeur and the glory that they are encountering. and perhaps, eventually, when you re spiritually ready, you ll turn on with your children, if you think that s the right thing to do. monterey pop, it was the absolute ultimate love-in. down by the window, just looking out at the rain mm-mmm, oh the best festival that i ve played pretty much ever is monterey pop festival. just looking out at the rain monterey hit like lightning. popular music was changing and had become something different, and it was a whole new generation of people that wanted to march with it. it said, get on board. we re leaving town. and i want to love you, i want to love you for so long oh, yeah you realize, this is janis joplin before she was known, before she had ever done her first album, before she had ever done her first single. looking out at the rain ic that is just being born. and the audience is like and i said, oh, whoa, whoa, well honey this can t be, b-b-b-babe, but now, no, no, no, yeah why, oh, why, people, tell me why love, honey, why love was like, was like a ball and a chain and the policeman who was in charge brought flowers out to his men, and he said, don t bust anybody. monterey was that hippie dream come true. culture was changing. the hippie movement, it was swaying the mainstream. this is where the youngsters come to buy their clothes. and not just the youngsters. it s the young adults and the men who are 40, 50 and even 60 years old. in the middle class, pot is going middle class and spreading like prohibition liquor. as more and more citizens get zonked out of their minds, the drug cult enters the bloodstream into american life. like it or not, we re living in the stoned age. the counterculture came in with hard punches to the mainstream culture. people have already changed their minds about contraception, abortion, premarital sex. the 1960s were absolutely a sexual revolution. because of the pill, women could take charge of their own bodies. they could be sexual. they didn t have to get pregnant. everything sort of coalesces. the perfect storm of societal forces come together. here, if you love somebody, and people here love everybody, if you want to make love somebody, then you should. there s no reason why you shouldn t. free love was all well and good, and there was a lot of accidental sex. [ laughter ] but we didn t look at it as hedonism. people were just so open to each other, and life was beautiful, you know, and people weren t judgmental. the mainstream young people were telling their parents, you ve been prohibiting my sexual freedom, and the puritan work ethic is bunk. it was clear the rules were changing. and the rules were really that there were no rules. ut once-daily anoro ellipta. it helps people with copd breathe better for a full 24hours. anoro ellipta is the first fda-approved product containing two long-acting bronchodilators in one inhaler. anoro is not for asthma. anoro contains a type of medicine that increases risk of death in people with asthma. it is not known if this risk is increased in copd. anoro won t replace rescue inhalers for sudden copd symptoms and should not be used more than once a day. tell your doctor if you have a heart condition, or high blood pressure. tell your doctor if you have glaucoma, prostate or bladder problems, or problems passing urine as anoro may make these problems worse. call your doctor right away if you have worsened breathing chest pain, swelling of your mouth or tongue, problems urinating or eye problems including vision changes or eye pain while taking anoro. nothing can reverse copd. the world is filled with air and anoro is helping people with copd breath air better. get your first prescription free at anoro.com. we all enter this world with a shout and we see no reason to stop. so cvs health is creating industry-leading programs and tools that help people stay on medicines as their doctors prescribed. it could help save tens of thousands of lives every year. and that would be something worth shouting about. cvs health, because health is everything. (vo) around age 7, the glucose metabolism in a dog s brain begins to change. (maryjo) she s always interacted with dogs and now does suddenly not want to be around dogs. (jack) she s very much a loner. (maryjo) you are what you eat and this is definitely the case with bright mind. (jack) i ve been surprised by how much has happened. she s much more affectionate than she was. (maryjo) she just has integrated herself into the family again. (vo) purina pro plan bright mind promotes alertness and mental sharpness in dogs 7 and older. purina pro plan. nutrition that performs. color is a beautiful thing.. i know, i know. color is a beautiful thing if you feel it, you can find it. all new color by behr. the topic tonight is the hippies. we have with us mr. jack keurac over here, who is said to have started the whole beat generation business. jack kerouac never wanted to be a prophet. he wanted to be a great american writer, but fame destroys people in america. to what extent do you believe that the beat generation is related to the hippies? well, they re just what do they have in common? was this an evolution from one to the other? they re just the older ones. i m 46 years old. these kids are 18. the beat generation was a generation of beatitude and pleasure in life and tenderness. i believe in order and piety. here s the progenator of the counterculture kind of disowning his own babies and trying to make sense of a decade he didn t feel pairy to. a movement which i did not intend. this was pure, in my heart. all sorts of people have been writing various articles about the hippies, usually about the hippies as if they were animals, something to look at. thus, we ve gotten hundreds and literally thousands of people coming up to haight-ashbury to watch people. it makes it an unpleasant place to be in. news got out about the haight-ashbury. it became overrun. we re now entering what is known as the largest hippie colony in the world. the fountainhead of the hippie subculture. the nickname is hashburies, and marijuana, of course, with lsd, is being used. literally people made the trip to san francisco to be a part of something. by the time they got there, that trip was over. this is the latest stage in the evolution of the hippie movement. the hippies are trying to get away. so, they go out to a cabin in the countryside and start a commune. here they can get away from the tourists and reporters that badger them in san francisco. communes started. this is really what the hippie movement was all about. an idea of sharing everything, clothes and food and everything. people would just help themselves. we lived communally because it was the cheapest way to live. a lot of people began to clarify and simplify their lives. what will follow this dispersal of the hippie movement to the countryside is hard to predict. they may be, as they say, coming here to build the foundations for a new society in this nation. or they may be becoming like the woolly mammoth, to find their own extinction. down where the wood vines twine, that s where i meet my love down where the sun never shines, down in the woods where the wood vine twine i was working for the new york times in the catskills. and there were just a couple of us going up there. as we went north of the city, we began to run into traffic jams. i finally said to a cop, what the hell is going on? he says, i don t know, there are thousands of people here, and they re all going to some farm. and it was, of course, woodstock. i think woodstock was an opportunity for people to realize they weren t alone. a lot of people who in their hometown or in their family felt isolated realized they weren t. the townspeople, quite frankly, were terrified at the prospect of the hippie arrival. i was apprehensive. this little hamlet has a population of under 100 people. when i started hearing the figures of 200,000, 300,000, finally, 500,000. we had a sea of people there. the word got out. everybody and their brother came from all over the country. first, the sudden rain. then the thirst and hunger from the shortage of water and food, just for the opportunity to spend a few days in the country getting stoned on their drugs and grooving on the music. we got together and had a little powwow about what are we going to do to feed these people? we went into new york to buy 1,500 pounds of wheat, rolled oats, 130,000 paper plates, 130,000 dixie cups, and i believe we served 200,000 people. by now there are tens of millions of people who feel themselves to be an irresistible river of change. and you get something incandescent. freedom, freedom, freedom freedom, freedom, freedom singing freedom, freedom, freedom, freedom, freedom freedom, freedom, freedom freedom, freedom, freedom freedom, freedom, freedom we had had love-ins in l.a. on the weekends where everybody gets dressed up and goes to the park and brings an instrument. but to see hundreds of thousands of people, like a meeting of all the tribes from all over the country. boy, we didn t know there were so many of us who felt the same. [ cheers and applause ] we must be in heaven, man! a rock music festival that drew hundreds of thousands of young people to a dairy farm in white lake, new york, over the weekend came to an end today. admittedly, there was marijuana as well as music at the rock festival, but there was also no rioting. what did not happen at that dairy farm is possibly more significant than what did happen. these long-haired, mostly white kids in their blue jeans and sandals were not wide-eyed anarchists looking for trouble. they were very polite. they emptied their shelves for kids. merchants were stunned by their politeness. while such a spectacle may never happen again, it has recorded the growing proportions of this youthful culture in the mind of adult america. whenever you see a phenomena, especially if you re living in it at the time, you tend to think, that s the arrival. this is the dawning and the start of something new. unfortunately, woodstock just marked the end of it. kaboom. well, i just have a few other questions. chuck, the only other question you need to ask is, what else can you do for me? i ll just take a water. get your credit swagger on. become a member of experian credit tracker and find out your fico score powered by experian. fico scores are used in 90% of credit decisions. (vo) you can pass down a subaru forester. (dad) she s all yours. (vo) but you get to keep the memories. love. it s what makes a subaru a subaru. is this going to be woodstock west? well, it s going to be san francisco. woodstock was followed by altamont only a few months later, and there couldn t have been two more different concerts. the jefferson airplane. jefferson airplane. we had had the hells angels be security at a number of free in the park concerts that we had done, and they were fine. they were funny. they were doing what they were supposed to do. so, we suggested using hells angels. what happened was a lot of speed and alcohol. that s a deadly combination for bikers. marty said the f word to one of the hells angels. while we were on stage, a hell s angel knocks him down. that was just the beginning. i would like to imagine that the hell s angels just smashed marty in the face, knocked him out a bit. i d like to thank you for that. you re talking to me, i m going to talk to you. i m not talking to you. i m talking to the people who hit my lead singer in the head. you re talking to me. i ll tell you what s happening. you are what s happening. no! one pill makes you larger, one makes you small and the ones that mother gives you don t do anything at all oh, that s what the story is here? oh, bummer. really, man. it s scary. who s doing all the beating? hells angels. hells angels are doing beating on musicians? marty got beaten up. go ask alice, i think she ll know when we left, it was dark and the rolling stones were on, and we were on a helicopter. paul looked down, he said, wow, it looks like somebody s getting killed down there. he was right. they were. remember what the door mouse said, feed your head feed your head in california, five members of a so-called religious cult, including charles manson, the guru or high priest, have been indicted in the murder of sharon tate and six others. all of the elements are present for one of the most sensational murder trials in american history. seven people brutally murdered in a glare of hollywood history. the involvement of a mystical hippie clan, which despises straight, affluent society. young girls supposedly under the spell of a bearded svengali who allegedly masterminded the seven murders. good morning. why? the sun s shining this morning. it is? yeah. charles manson cleverly masqueraded behind the image of being a hippie, goes up to haight-ashbury district, surrounds himself with a bunch of young followers. their lifestyle was sex, orgies and lsd trips. allegedly, he gets them to mass murder for him. with blood, the killer scrawled on a refrigerator door death to pigs. you see, prior to these murders, nobody associated hippies with violence and murder. people would pick up a hitch-hiking hippie. there was no big deal. but after the manson murders, you saw a hippie with long hair hitch-hiking and the image of manson would enter the driver s mind and they would drive right by. by the time of charles manson and watching altamont and what happened there, it symbolized the drained idealism of the spiritual quest of the beats and early hippies. today, the magic is gone. aimless and disorganized, the hippies have fallen prey to their own free spirit. free love, free drugs and too much free publicity have gradually corrupted them. somebody happened to haight-ashbury since last year. we hear it s not the same place. it s not. the love-ins brought more and more people. then people who were just bums trying to get into a good thing, you know, free food, free everything. so they all just came in, you know. and a lot of really rotten people. so now you ve really got a bad thing. it used to be you could set your stuff down beside the road, nobody would touch it. and now it got so you couldn t even put your things inside a building. somebody would come along and take everything you had. one day i woke up very hungry, very tired and disgusted and decided to get a job, settle down and get serious. joe s job is making jewelry. he s been taking a six-month course to learn how. it was hard in the beginning. getting up at 8:00 every morning and all those changes. joe bought the suit, uncomfortable though it looked. will he be equally uncomfortable in his own life? there have been generation gaps before, but today s is probably the widest yet. can the joes of america bridge the gap and conform without society making concessions in return? i would say there was a common element in the counterculture of people trying to invent a new world. but people mature. their point of view gets more nuanced. the costs start to come due. children come into the world. that idea of sex, drugs, and rock and roll, it s a youth dream, then youth dies. yet, our mainstream culture took what it needed from the hippies. the actual movement of the 60s was the movement towards something more authentic. in the 60s, we thought of other people as part of our own family. we were into caring for society as a whole. this is what the revolution is all about. mercy is better than justice. the carrot is better than the stick, and the most important lesson is, be kind, be kind. to me, every day was a highwater mark. we played music all day long. we worked. we did not have jobs. it was the most care-free period of my life. dylan has this great line in the early song, he says, i wish, i wish, i wish in vein that we could sit simply in that room again. $1,000 at the drop of a hat. i d give it all gladly if our lives could be like that. esleys. it s not true, it s not true! when the beatles arrived, from then on a thousand different things arose. glad all over is it a sex thing or yes, it s sexual. there was the desire to get power in order to use it for good. how does it feel pop musicians in today s generation, they can rule the world.
broadcast. new york state offered $100,000 reward for information leading to the capture of two killers on the run. the men broke out of a maximum security prison in dannemora new york, launching a manhunt in the foothills of the adirondack mountains near the canadian border. authorities are looking for richard matt and david sweat. both serving long sentences for two separate brutal murders. check points remain in place near the prison but the search has now expanded to canada and neighboring states. we begin with don dahler in dannemora. reporter: armed law enforcement officers are panning checkpoints on every road around the upstate new york town of dannemora hunting area. much of which is heavily wooded. the clinton correctional facility is roughly 20 miles from the canadian border so police in that country have increased their vigilance as well. at this point in excess of 150 leads have been developed. reporter: sometime before 5:30 a.m. saturday convicted murders richard matt and david sweat escaped their adjoining cells through holes, authorities say, were cut by the men using a power tool. they then broke through a brick wall, climbed on to a six story high catwalk and made their way into a steam pipe, weaving through a complex series of tunnels. they left behind a note with a racist caricature and the words, have a nice day. authorities say the two emerged from a manhole after cutting through its lock and chain hours after they were discovered missing. new york governor andrew cuomo toured the facility. encompassed drilling through steel walls and steel pipes. so this was not easily accomplished. reporter: francine mitchell lives within sight of the prison. so immediately i made sure i locked all the door, made sure the windows were secure. reporter: richard matt is 48, serving a 25 years to life sentence for kidnapping and murdering his former boss in 1997. he s described as six feet tall with black hair and hazel eyes and has tattoos including mexico forever on his back and a marine corps insignia on his right shoulder. after a burglary conviction he escaped from a different prison and fled to mexico where he was convicted of another murder before being extradited to the u.s. 34-year-old david sweat is 5 11 with brown hair and green eyes and tattoos on his left bicep and right fingers. he was serving a life sentence without parole for the murder of a broom county new york deputy. his escape has stirred up raw emotions in that sheriff s department. mr. sweat is a local person. he s from this area. so of course our the threat level goes up a little bit. reporter: there have been contractors working at the prison. authorities say that may have been how matt and sweat got ahold of a power tool. jeff, the reward is $50,000 for the help in the apprehension of either of the two men. glor: don dahler in dannemora, thank you very much. authorities in new york hope history is on their side. in most cases, prisoners who pull off daring escapes end up getting caught. the danger is what happens in between. here s carter evans. reporter: they became known as the texas seven, a group of violent convicts who in 2000 escaped from a maximum security prison outside san antonio. they overpowered guards and stole their uniforms to get free. but while on the run for nearly a month, they murdered a police officer and committed numerous robberies. six were eventually recaptured and sentenced to death. the other committed suicide during a standoff with police. one especially notorious prison escapee is richard lee mcnair, a convicted murderer who broke out three times from three separate prisons. the last in 2006 when he hid in a pile of shipping bags and in effect mailed himself out of a federal prison in louisiana. and while he often changed his physical appearance, sometimes he just talked himself out of trouble. i promise you i am not no you would have done wrong by now. mcnair was eventually recaptured 18 months later in canada. perhaps the most infamous prison break is the one still shrouded in mystery. the escape of three inmates from alcatraz more than half a century ago. they used spoons to dig through the walls and just like the escaped inmates in new york, they left decoys in their beds before they fled into san francisco bay using rain coats as makeshift rafts. it is still unclear whether they actually made it or died trying. carter evans, cbs news, los angeles. glor: new flooding concerns in the south and severe storms in the midwest. first the red river continues to rise near shreveport, louisiana. here it is just over 34 feet t is expected at 37 feet by tomorrow. eric fisher of our cbs boston station wbz is tracking the situation. eric, what is the latest? reporter: jeff, we had tremendous rainfall back in may, across the red river base in that water moving downstream the crest coming to shreveport tomorrow on monday. the highest water seen since the floods of april of 1945. minor flooding expected as the water moves down towards alexandria later into the weekend. high pressure late this week sets move toward the florida panhandle, really going to pump up a lot of tropical moisture this is something to watch and certainly heavy rain may be a threat again heading towards next weekend. in the short term watching kansas across parts of the midwest around chicago, detroit, indianapolis, all with the risk of severe weather tonight. that threat will extend eastward heading into monday. could be a busy start to the week. west of new york city and d.c. down towards nashville. we ll be keeping a close eye on it. glor: thanks very much. the g7 summit is under way in germany. used to be the g8 but russia sidelined over the flooding ukraine. president obama s day began with a meeting focusing on mending ties with germany. major garrett is traveling with the president. reporter: bavaria, land of lederhosen trotted out the green hats for president obama. music played as german chancellor angela merkel escorted the president through well-wishers to a sun splashed picnic of pretzels and beer. afterward the president sounded satisfied. how was the beer, mr. president? it was a very fine beer. i wish i was staying. reporter: the stunning setting for the g-7 could not compensate for a summit noticeably short on ambition. the u.s. is lobbying europe to maintain economic sanctions on russia due to expire next month. but not contemplating new penalties for its incursion in ukraine. the president and merkel agreed and mr. obama took up the issue with british prime minister david cameron. i think there can be a peaceful diplomatic resolution to this problem, but it s going to require that europe and the united states and the transatlantic partnership as well as the world stay vigilant. reporter: as for debt-racked greece, leaders are exploring ways to shield international markets from potential default. they re also lobbying cameron to keep the united kingdom from leaving the european union. leading up to the summit protesters clashed with police. an estimated $8,000 have gathered to decry economic globalization, income inequality and pollution. the president meets on the summit sidelines tomorrow with iraqi prime minister al abadi to discuss coalition efforts to defeat isis, abadi recently complained coalition partners are not doing enough. even so, jeff, the president is not expected to bring new commitments to the fight. glor: major garrett, thank you very much. car sales took off in the u.s. last month. new vehicles were moving off the lot at a pace of nearly $18 million a year. here now with more is cbs news business analyst jill schlesinger. americans are not spending overall but they are buying cars, why? the average age of a car on the road right now is 11.4 years old. so as the aging vehicles need to be replaced, people have to get to work, they cannot delay this. we ve talked to auto experts who say this could be the best year for auto sales in a decade. glor: here s the thing. wages are not up so how are people buying these cars? these low-interest rates are really helping. so all the loans have exploded and specifically auto loans for subprime borrowers credit scores below 640. one in four auto loans is for a subprime borrower and part of that is lenders are more willing to do this because delinquencies are down, the economy is getting better. but there are also ways they can track these drivers. they put something in the car called, get this, starter interrupt devices, that can remotely shut your car off if you are a delinquent borrower. glor: truck and suv sales also up big time is this because of low gas prices? yes, low gas but also people believing that gas prices will stay low. when you look at large suvs, the biggest guzzlers, up 12.4% last year, hybrids down by 9%. glor: jill, thanks very much. thank you. glor: american pharoah entered the history books this weekend as the first triple- crown winner in 37 years. so what s next? here s michelle miller. they re off in the belmont stakes. reporter: american pharoah lead wire to wire to win by five and a half lengths. american pharoah has won the triple crown! reporter: for the jockey victor espinoza, his third try was the charm. he stepped back but in two jumps i was right in the lead. reporter: you were here for all three. yes. lifelong racing fan ryan riboldi witnessed history. he followed american pharoah from the kentucky derby to the preakness and finally to the belmont stakes, riboldi said he knew even the well rested competitors couldn t beat american pharoah. he proved that if you are a great horse, you win the triple crown. if you are a good horse, you win two out of three. reporter: and the three-year- old colt may not be done winning. originally racing manager justin zayat said american pharoah would be retired after the triple crown win. he is going to the four seasons as soon as he retired. now his father, owner abed zayat says the family has had a change of heart. it s my genuine desire as a fan, somebody who loves horses is to race him as long as i possibly could. reporter: ahmed said he s already sold american pharoah breeding rights for an untold sum. sports analysts estimate the superior horse could bring in as much as $100 million, hall of fame trainer bob baffert has three previous horses come up short. it is ridiculously insane what he did yesterday. i will never forget the sound of the crowd. reporter: with american pharoah not being put out to stud, he may hear that sound again. michelle miller, cbs news, new york. glor: the women s world cup soccer tournament kicked off in canada this weekend and team u.s.a. is hoping to win for the first time in 16 years. jericka duncan is in winnipeg. reporter: team u.s.a. comes to canada with one perfect goal in mind, win the title they narrowly lost against japan four years ago. midfielder megan rapinoe. i m anxious and ready to go and i can t wait to play games. reporter: rapinoe was one of the stars of an american roster filled with them. abbey wallback is the all-time goal scorer male or female in international play. fiery goalkeeper hope solo is still one of the best in the net. and 39-year-old countries ini christy rampone playing in her 6th world cup, the last remaining agoative player from that iconic 1999 world cup team that took the title. winning it back won t be easy. today s international field is more competitive than ever. the women s game, i think, is growing so much. and you re seeing around the world so much more money and just more resources put into the club environment and the professional environment. reporter: forward alex morgan is a go-to scorer but she s nursing a bruised knee that forced her to miss almost all the pre-cup warm-up games. i m going to be ready and ready to give everything that my team knows i can give out at the world cup. so nothing is really going to hold me back from playing this tournament. reporter: the u.s. team arrives hear with high expectations. but germany, france, sweden and japan all loom large. the u.s. women s team plays their first game tomorrow evening against australia, the stadium seats more than 30,000 people and jeff, officials say they are expecting a near sellout crowd. glor: jericka duncan, thank you. the texas police officer on leave after a confrontation with teens at a pool party. and the big upset at the french open when the cbs evening news continues. so when my husband started getting better dental checkups than me i decided to go pro. with crest pro-health advanced. my mouth is getting healthier. my teeth are getting stronger. this crest toothpaste is superior in five areas. great checkup. guys, it s just the two of you. the setting is just right. but here s the thing, about half of men over 40 have some degree of erectile dysfunction. well, viagra helps guys with ed get and keep an erection. and you only take it when you need it. ask your doctor if your heart is healthy enough for sex. do not take viagra if you take nitrates for chest pain; it may cause an unsafe drop in blood pressure. side effects include headache, flushing, upset stomach and abnormal vision. to avoid long-term injury, seek immediate medical help for an erection lasting more than four hours. stop taking viagra and call your doctor right away if you experience a sudden decrease or loss in vision or hearing. ask your doctor about viagra. kellogg s® frosted mini-wheats®. 8 layers of wheat. and one that s sweet. for the adult.. and kid - in all of us. 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[music] defiance is in our bones. new citracal pearls. delicious berries and cream. soft, chewable, calcium plus vitamin d. only from citracal. glor: a police officer from the dallas suburb of mckinney is on leave after pulling his gun on teenagers at a pool party. the confrontation was caught on cell phone video and mark albert has details. get on the ground, i told you to stay. reporter: officers were responding to a disturbance call at a community pool in the dallas suburb on friday when according to police, they were met by multiple juveniles refusing to leave. this cell phone video posted on youtube appears to show one officer forcing a young woman in a swimsuit to the ground. then pulling his gun on a group trying to intervene. oh my god. reporter: the officer then tells her to get on her face and later kneels on her back. greg conley is the chief of police. it s something we re going to have to look into to determine what we re training as far as the officers and their reaction on the scene. any time you confront a large group of people, it s very dynamic situation. and can tensions can rise very quickly. reporter: the incident is just the latest in a series of conflicts between white police officers and black citizens caught on camera. how is this happening? how is this happening? reporter: last march images of university of virginia student martese johnson sparked public outcry and in september the california highway patrol reached a $1.5 million settlement with marlene pinnock after video surfaced of the 51- year-old getting punched repeatedly by an officer. but the interactions in the texas video weren t all hostile. two young men returned a missing flashlight to one of the officers. who offered this advice. i m just saying, don t take off running when the cops get here. reporter: police say they made one arrest and are not aware of any injuries. everyone else was released to a parent or guardian. police did not say how long the investigation into the officer will take. jeff? glor: mark albert, thank you very much. up next here, an american woman sets off on a solo journey rowing across the pacific. bring us your aching and sleep deprived. bring us those who want to feel well rested. aleve pm. the only one to combine a safe sleep aid. plus the 12 hour pain relieving strength of aleve. be a morning person again with aleve pm. the real question that needs to be asked is what is it that we can do that is impactful? 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(supergrass alright ) (plays throughout) kellogg s frosted mini wheats® feed your inner kidult. working on my feet all day gave me pain here. in my knees. but now, i step on this machine and get my number which matches my dr. scholl s custom fit orthotic inserts. now i get immediate relief from my foot pain. my knee pain. find a machine at drscholls.com you total your brand new car. nobody s hurt,but there will still be pain. it comes when your insurance company says they ll only pay three-quarters of what it takes to replace it. what are you supposed to do, drive three-quarters of a car? now if you had liberty mutual new car replacement, you d get your whole car back. i guess they don t want you driving around on three wheels. smart. with liberty mutual new car replacement, we ll replace the full value of your car. see car insurance in a whole new light. liberty mutual insurance. introducing the first ever gummy multivitamin from centrum. a complete, and tasty new way to support. your energy. immunity. and metabolism like never before. centrum multigummies. see gummies in a whole new light. glor: we close tonight with an update from haiti where two baby girls recently went through a dangerous operation dr. jon lapook was there as surgeons made medical history. reporter: there is nothing unusual about twins holding hands. but six month old infants marian and michelle bernard share much more. they are joined at the abdomen. they are minutes away from one of medicine s rarest and riskiest operations. improbably, the 2010 earthquake that brought so much death and destruction to haiti, also helped bring michelle and marian a shot at a normal life. their chance lies in the hands of dr. heni ford. born in haiti, he and his family left this port-au-prince neighborhood in 1972. he became an ivy league trained pediatric surgeon, now chief of surgery at children s hospital los angeles returned to his home country. that changed when the earthquake struck. i arrived the second day the airport opened and pretty much went to work and spent two absolutely grueling weeks, toughest of my life it wasn t a one and done thing. reporter: ford put together a team of more than two dozen volunteer health professionals from the united states and haiti. reporter: to avoid confusion, everyone is color coded. a line is drawn to show the surgeons where to cut. what we found was pretty much as expected. reporter: things go smoothly until michelle s blood pressure suddenly and dangerously drops. she is given a transfusion and i.v. fluids but because the twins still share a liver those fluids go from michelle s bloodstream into marians. the remedy is to complete the separation and to do it quickly. we now have two babies. two independent, living organisms. reporter: nearly seven hours after marian and michelle bernard enter the operating room together, they leave in separate cribs. their parents are overwhelmed. i m very happy. very happy. there is something special about coming to haiti to operate on haitian children with haitian physicians, haitian anesthesiologist because i feel that i m contributing to the future of this country. reporter: just this friday, two weeks after the operation, the healthy girls are discharged from the hospital. a homecoming made possible by a native son coming home. dr. jon lapook, cbs news mirebalais haiti. that is the cbs evening news , later on 60 minutes, followed by the tony awards. and first thing tomorrow, cbs this morning. i m jeff glor in new york. good night. captioning sponsored by cbs captioned by media access group at wgbh access.wgbh.org tenants to conserve water. tragedy on a bay area interstate three people are killed in a more fall out from the record-break drought. the trick many are doing to get people to conserve water. tragedy on the interstate. three people killed in a horrific crash in which two people were thrown from the vehicle. get ready to bake. a heat advisory fo good evening to you. misty may, june gloom are gone. for the first time since last fall the bay area is seeing is serious heat. he d advisory goes into effect tomorrow for most inland locations. it was already heating
pelley: good evening. this is our western edition. you can be sure the heat will be cranked up in the car tonight when president obama makes his way to the capitol for his fifth state of the union address. it s 19 degrees here, heading down to 14, and that s just tip of the iceberg across much of the country. the mid-atlantic states are getting another round of dangerously cold temperatures, and the south is seeing something it almost never sees snow. atlanta got about 2.5 inches, but that was enough to cause big problems in a city not used to it. in chicago, the temperature hit 11 degrees 11 below 0. we have a team of correspondents covering the severe weather affecting an estimated 70 million americans. first, manuel bojorquez in north carolina. manuel. reporter: well, scott, freezing rain has started to fall here, but fayetteville is expected to get up to six inches of snow, its worst storm in three years. drivers unaccustomed to slick roads are going nowhere fast. crews in north carolina sprayed roads with de-icing fluid, but traffic was still a mess in places as drivers tried to beat the ice and snow. this was atlanta; a 20-minute trip took three hours. less than an inch of snow near birmingham, alabama, caused this. six southern states have declared an emergency. widespread power outages are expected. this convoy of trucks was being pre-positioned near jackson, mississippi. now, towns are rolling out rarely used snow plows. bill hammond is a maintenance engineer for cumberland county, north carolina. it may be tough, depending on how much snow accumulation we get. if it tracks further east and we don t get none it, won t hurt my feelings at all. reporter: schools here will be closed tomorrow. fort bragg, the army s largest base, is also closed for nonessential personnel. scott, temperatures in this part of north carolina will not get above freezing until thursday. pelley: manuel, thanks. in the upper midwest today, we saw a tragic example of how dangerous this weather can be. jamie yuccas of cbs station wc northern plains dip to 46 below zero. jamie yuccas of cbs station wcco in minneapolis has our story. reporter: wind chills on the northern plains dip to 46 below zero. one driver who slid off a road west of minneapolis froze to death. mccloud county sheriff scott raymond: the driver made a decision to walk home and never made it. reporter: icy highways and blowing snow contributed to more than 350 crashes around minnesota. any moisture on the road immediately freezes, creating black ice. we see black ice form, actually, when the exhaust from vehicles driving over the roadway freezes, and it doesn t typically happen until those temperatures get well below zero. neither one of you guys are hurt, though, right? reporter: minnesota state trooper tom erickson told us that raises the risk for first responders. it makes it very dangerous for us as first responders on the scene. we have a number of squads who have been hit. reporter: none of the troopers injuries were serious. temperatures here tomorrow could finally reach the low 20s. pelley: even in places that are used to this kind of snow and ice, this winter is busting budgets and a lot more. here s elaine quijano. reporter: the cold is blamed for two water main breaks today in new york city. one was in greenwich village, where ellen peterson-lewis has lived for some 50 years. how old are these pipes? they probably date back to the late 1800s. reporter: des moines, iowa, has had a record 100 water main breaks since january 1. damaged pipes also created this sinkhole in detroit. some cities, including indianapolis, have nearly used up snow removal budgets. michigan has spent almost $6 million, twice as much as last winter. here in the new york area, the long island community of brookhaven has almost run through its entire $3 million snow removal budget. scott, the town will likely have to borrow money to pay for additional snow costs this winter. pelley: elaine quijano in manhattan. thank you, elaine. president obama put the finishing touches on his state of the union address last night. the speech is creating controversy, even before he s delivered it. his advisers told us today he plans to tell congress he will use his executive powers to get at least part of what the republican-controlled house won t give him. one of those things is an increase in the minimum wage, at least for some workers. major garrett has seen part of the speech at the white house tonight. major. reporter: scott, the president will highlight continued job gains. he will talk about the improving housing market, and a stronger auto industry, but he will concede wages remain stagnant, income inequality has increased, and the feeling that many americans have that they re treading water economically and doubt whether or not they can ever get ahead. one of the things the president will say is, our job is to reverse these tides. what i airfare tonight say set of concrete, practical proposals to speed up growth, strengthen the middle class, and build new ladders of opportunity into the middle class. some require congressional action, and i m beinger who, to with all of you. as you mentioned, scott, the president will take some action on his own. he will eventually sign an executive order raising the minimum wage for some federal contract workers to $10.10 an hour, but the white house has not told us when that executive order will be signed or how many workers will be affected. pelley: major, thanks. the idea of using executive orders to go around congress riles republicans, of course. john boehner, the speaker of the house told us this morning, we do have a constitution. if the president ignores it, he ll run into a brick wall. late today, we spoke with the republican chairman of the house budget committee, paul ryan. the president is going to say in his speech tonight that he s going to work with congress where he can and go around you where he must. how does that sound to you? well, we each take an oath of office to swear to protect constitution. it sound to me like he wants to go around want constitution. if you want to write a law, the elected representatives here in the house and the senate, the legislative branch, they re the ones who write laws. presidents don t write laws. pelley: what about immigration reform? any hope for that? i think there is hope for that. we intend to take this issue up here in the house. pelley: what are house republicans willing to do on immigration that is a step toward the president s side? it s taking the issue up, number one. number two, we think we need to fix illegal immigration. we think he we d to fix the fact we have 11 million or so undocumented. we won t give an amnesty. we will not do that. i think the president understands that. pelley: you say no amnesty, but would you contemplate a situation where a person who is in this country illegally could go through certain steps and at least, if not citizenship, could attain legal status somewhat. yes, there is away of doing that not talking about citizenship a way of doing that where a person can earn legalization, something like a probationary status, where they have to go through acknowledging that they broke a law and make amends with that, whether it s paying back taxes, fines, learning english, learning civics, making amends with the fact they did not follow our law, and making sure the federal government does its job securing the border. pelley: we are two or three weeks away from this country having to raise the debt ceiling again, the amount of money it can borrow to pay the bills. are republicans willing to do that without conditions so that that piece of business just gets done and we don t have another crisis? we don t want to have a government crisis. that s one of the reason we had a budget agreement which prevented two possible shutdowns from occurring this year. this is our concern with the president. his plan for jobs spend more money. his plan for taxes raise them. his plan to pay off the debt he doesn t have one. at least work with us on something to reduce the debt. pelley: will the full faith of the united states number jeopardy again? no. pelley: it will not happen. no, it will not be in jeopardy again. pelley: and bob schieffer is joining us now, the anchor of face the nation, our chief washington correspondent. bob, what about this idea, the president using executive orders to bypass the congress? well, presidents in the past have used it to do some big things. harry truman desegregated the armed forces with an executive order. jimmy carter created fema, the emergency management agency that looks after disasters. but the fact is, when you look back, president obama has used the executive order very sparingly. you have to go all the way back to grover cleveland in the late 1800s to find a chief executive who has used executive orders fewer times than president obama did during his first term, 147. having said that, republicans think that the president, by announcing this, is really kind of rubbing their noses in it here. they also point out that what he s talking about is raising the minimum wage for people involved in future government contracts. john boehner said today this is not going to affect anyone right now who s working for the federal government. so it will be interesting to see rogers, begins at 9:00 eastern time, 8:00 cen pelley: bob, thank you. and you ll be right here with us for our coverage of the president s speech. our live coverage of the state of the union address, and the republican response from congresswoman cathy mcmorris rogers, begins at 9:00 eastern time, 8:00 central. this that begins immediately following this broadcast at 6:00. there is a. violent situation that is getting worse by the day in the former soviet republic of ukraine. protests started two months ago when ukraine s president rejected an economic deal with europe in favor of closer ties to russia. holly williams is in the capital, kiev. capital, kiev. reporter: anti-government protesters on kiev s central square have barricaded themselves in, determined to stay put after days of deadly clashes. at least five people were killed last week when riot police fired rubber bullets and stun grenades and demonstrators hurled rocks and molotov cocktails. now, the police have retreated, and today, the country s unpopular prime minister resigned but that won t be enough for many here who claim the government is corrupt and increasingly authoritarian and too close to russia. inside kiev s city hall, we met andre, an unemployed waiter. i would stay here, until the president will go, and the government as well. reporter: you want the president to quit? yes, of course, first the president and his team get out, please. reporter: these demonstrations began peacefully in november when president victor yanukovych turned his back on a free trade treaty with europe in favor of a $15 billion rescue package from russia. but after enduring years of russian rule during the soviet era, many ukrainians still fear political interference from moscow. marsha borysova, a 10-year-old protester, explained why many ukrainians want their country to move away from russia and towards democracies. democracies. reporter: tomorrow, ukraine s parliament will vote on an amnesty that would free protesters arrested during the last few months. it s another attempt to appease the demonstrators, but, scott, they say they ll only be satisfied if the president resigns and the country holds fresh elections. pelley: holly williams, above independence square in kiev. thank you, holly. in one of the most beautiful states in america, the governor warns something ugly is bubbling up beneath the surface. a pope who preaches humility is getting rock star treatment. and queen elizabeth is urged to watch her spending when the cbs evening news continues from washington. sorry. 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[ male announcer ] get the spark business card from capital one. choose 2% cash back or double miles on every purchase, every day. what s in your wallet? i need your timesheets, larry! pelley: the president s address tonight will cover a world of subjects, but one state governor decided he would talk about just one crisis when he gave his state of the state address to his legislature. the crisis is heroin, the state is vermont, and michelle miller is there. reporter: 27-year-old stephanie mountaine grew up in st. albans, vermont, the picture of the all-american girl. but behind these smiles, from the age of 17, she hid a addiction. what was your gateway? i started smoking marijuana. reporter: from there? i smoked crack and tried pills. eventually, it went to oxycontin, to eventually heroin to i.v. drug use. reporter: what would do you for a fix? i would steal from my family. i would do whatever it took. reporter: she has been in rehab five times. about 4,000 vermonters are in drug treatment for opiates such as oxycontin and heroin. since the year 2000, vermont has seen nearly an 800% increase in opiate drug abuse. governor peter shumlin: it s an illness we need to treat, talk about, and stop being afraid of acknowledging. reporter: the two-term democrat said devoting his entire state of the state speech was necessary, because 80% of inmates in vermont jails are there on drug-related charges. serious crimes are up 46% over the past five years. and last year, heroin overdose deaths almost doubled. it doesn t affect just one class of people. it affects rich and poor. it knows no party lines. it knows no economic lines. reporter: access and demand have fueled a $2 million-a-week drug trade through the state. vermont sits in the middle of the northeast drug corridor. dealers traveling between philadelphia and montreal have found small vermont towns to be lucrative stops. you can go and buy a bag of heroin for five, six bucks a bag, and you can sell is it here for $20, $30 a bag. you can understand the economic incentives for drug dealer for destroy lives. reporter: they are pushing for harsher penalties for dealers, and help for addicts by putting them in treatment instead of jail. stephanie mountaine said she s now clean and working at the vermont teddy bear factory. i had to keep so many secrets, and i don t have to do that anymore. reporter: she is no longer a prisoner to her addiction. the governor hopes to free his state from the same peril. michelle miller, cbs news, montpelier, vermont. pelley: in a first today, a group of college football players has asked permission to be represented by a labor union. the players, from northwestern university, called the n.c.a.a. a dictatorship that gives players little say in safety while generating billions off their talent. we ll be right back. 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[ man ] with copd, i thought i d miss our family tradition. now symbicort significantly improves my lung function, starting within 5 minutes. and that makes a difference in my breathing. today we re ready for whatever swims our way. ask your doctor about symbicort. i got my first prescription free. call or click to learn more. pelley: queen elizabeth is being told to watch her finances. a report today by the house of commons says the royal family is running low on money and buildings are in urgent need of repairs. the heating system in buckingham palace is more than 60 years old. the report suggests that the royals may need to cut staff and open the palace to visitors more often to raise money. today, a missing ingredient was added to the google glass. that s the experimental eyewear that is basically a tiny computer with a screen above the wearer s right eye. it should be available later this year. today, google said it will offer an attachment for people who use prescription eyeglasses. quite a few people have commented that pope francis has the appeal of a rock star. today, he made the cover of rolling stone. the magazine s next issue explores the pope s efforts to bring the catholic church into a new era. its headline borrows from bob dylan the times, they are a- changing. one of the great influences on bob dylan and generations of folk singers has died. in a moment, we ll remember pete seeger. but i am so stuffed up, i can t rest. 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[ male announcer ] it s known that diabetes damages nerves. lyrica is fda approved to treat diabetic nerve pain. lyrica is not for everyone. it may cause serious allergic reactions or suicidal thoughts or actions. tell your doctor right away if you have these, new, or worsening depression, or unusual changes in mood or behavior. or swelling, trouble breathing, rash, hives, blisters, changes in eyesight including blurry vision, muscle pain with fever, tired feeling, or skin sores from diabetes. common side effects are dizziness, sleepiness, weight gain and swelling of hands, legs and feet. don t drink alcohol while taking lyrica. don t drive or use machinery until you know how lyrica affects you. those who have had a drug or alcohol problem may be more likely to misuse lyrica. ask your doctor about lyrica today. it s specific treatment for diabetic nerve pain. to hear more of terry s story, visit lyrica.com. pelley: as president obama was preparing to speak about the state of the union, he took a moment to honor a man who sang about it, pete seeger. the legendary folk singer died last night at the age of 94. the president said seeger used the power of song to remind us where we come from and show us where we need to go. here s anthony mason. if i had a hammer reporter: pete seeger, who wrote if i had a hammer, used music to break down walls his whole life. if i didn t think music could help save the human race, i wouldn t be making music. angry, angry, are we reporter: he resurrected america s homegrown folk songs while writing some giants of his own, like where have all the flowers gone and the byrds hit, turn, turn, turn. the son of musicians, seeger would drop out of harvard to ride the freight trains with folk legend woody guthrie, who inspired him to write the words on his banjo. this machine surrounds hate and forces it to surrender. he had a sign on his guitar saying, this machine kills fascists. i wanted to have something a little more peaceful. reporter: but he carried that banjo into many battles. in his support for workers rights, seeger, for a time, embraced communism. good night, irene good night reporter: after good night irene, his song with the weavers, hit number one, seeger was blacklisted and later convicted of contempt of court when he refused to testify before the house un-american activities committee. how did you feel in the midst of all this when you were being blacklisted? oh, it was a joke. reporter: his conviction was later overturned. in an interview for cbs sunday morning, seeger was still defiant. all it did was give me free publicity and sell more tickets anthony mason, cbs news, los angeles. this land was made for you and me pelley: and that s our western edition of the cbs evening news. the president s state of the union address is coming up next. with thanks to the jones day law firm for this view of the capitol and for all of us at cbs news all around the world, i m scott pelley. i ll see you in a minute. ,,,,,,, captioning sponsored by cbs this is a cbs news special report. president obama s state of the union address from a joint session of congress. from washington, here is scott pelley. pelley: good evening, president obama is about to give us a status report on what george washington called the american experiment, an experiment now in its 238th year. since his last state of the union, the unemployment rate has fallen below 7% since the great recession. some of it because there are more jobs but also because some people have stopped looking for work and are no longer counted as unemployed. since the president s last state of the union speech, more americans believe the country is headed in the wrong direction. 61% up from 54% a year ago. and the president s job
and a good evening to you on this tuesday night. we are here in washington, d.c. for the president s state of the union address. and one thing is certain, tonight, this union is in the grip of a deep freeze. more than 140 million americans in 24 states with a big chill, the slick ice and a scramble for help. as tonight, we take you down south, where the palm trees are frozen and the fountains are icicles. abc s steve osunsami standing by in greenville, north carolina. reporter: first, a blizzard. and now, brutal cold for parts of the midwest. windchills as low as 40 below. the first time in years the south is really feeling it, too. governors sending in the national guard to deal with a rare snow and ice storm. as soon as the first snowflakes fell, school officials across nine southern states started cancelling classes. the icy roads here, no place for a school bus. outside asheville, north carolina, six teenagers were on the bus ride home when they flipped the on the ice. and one of them had to be hospitalized. just come around the curb. just slid off in the ditch. reporter: tonight, schoolchildren in alabama are stuck at school. the roads, too dangerous for parents to come get them. if you trust your teacher to take care of your child during the day, they will be taken care of tonight. reporter: this was a freeway in austin, texas, today. police here reporting more than 214 accidents and counting. passed about ten wrecks on the way here. reporter: in new orleans, where the city doesn t even own a single salt truck or snowplow, they re calling this their worst winter storm in at least ten years. winter storms of this nature are very, very unpredictable. and are to be respected. reporter: around atlanta, the highways were a mess. i haven t seen it like this in years. reporter: families who emptied grocery stores spent hours trying to get home on the icy roads. i d advise, if you ain t got to be out, stay at home. reporter: for cities like wilmington, north carolina, myrtle beach, charleston, this is their first measurable snow in years. and some areas could see between six and ten inches. greenville, north carolina, is expecting snow all night. and they only have three snowplows. the city of new york has dozens, if not hundreds of snowplows. you have how many? three. reporter: three. we do hurricanes. we don t do snow. reporter: just yesterday, it was 65 degrees here. here are those three snowplows here in greenville, waiting for the snow. it s starting to sleet already. governors across the south, tonight, declaring states of emergency, trying to get resources like these to the places where they re most needed. diane? as you were saying, steve, it s once in a generation. thank you. so, is there any relief in sight? let s go to abc s meteorologist, ginger zee, now, with the answer. ginger? diane, that s the question everyone is asking. as you see the ice chunks floating on the hudson river behind me, i have an answer. yes, relief is in sight. but we ve got to get through that storm first. let s talk about it, as that low pressure system slides across the southeast. it will eventually pull away tomorrow morning. you can see the coastal carolinas getting a little of the snow and freezing rain mix. and then, it is the windchill that settles in. that s going to be the headline early for so many people. really, the eastern two-thirds of the nation, that s the brunt of the cold. and yes, that white color is zero, dipping into the deep south. but places like atlanta, that will struggle to make it to freezing, as we go into your wednesday, will be 60 by the weekend. diane? okay. thank you, ginger. and also, to steve again. as we said, we are here in a very cold washington, d.c., tonight, for the president s state of the union address. he s about to announce ideas for his final three years. so, is he fed up with congress? will he go it alone? here s abc s chief white house correspondent, jonathan karl. reporter: taking a quick break from speech prep, president obama got a taste of the frigid washington weather. good thing the speech is inside. reporter: it s not just the weather that is cold. obama has the lowest average approval rating of any president after five years in office. the white house sees tonight as a chance to get things back on track. the president has spent the last week refining his speech and practicing his delivery. one of the big themes, the president doesn t need congress to get things done. it s always better when you have big, bipartisan solutions in congress. but the president has tremendous authority. and he s going to use every ounce of it here. reporter: case in point, a push to connect 15,000 public schools, 2 million students, to broadband internet, using both private funds and money congress has appropriated. the president will promise executive action to require higher fuel standards for trucks. and to raise the minimum wage for those working on future federal contracts. but a warning from republican speaker of the house john boehner, who told reporters today, if the president tries to ignore congress, he s going to run into a brick wall. we re not going to sit here and let the president trample over us. the president also hopes to inspire tonight. he and the first lady have invited some genuine american heroes. boston bombing victim, jeff bauman and carlos arredondo, who helped save his life. boston strong personified. and antoinette tuff, the bookkeeper who prevented a potential elementary school massacre by talking a would-be shooter into surrendering. the white house has just released a few excerpts of the president s speech. and in these, you see a real note of determination and defiance. one excerpt saying, america does not stand still. and neither will i. so, wherever and whenever i can take steps without legislation to expand opportunity for more american families, that s what i m going to do. that, a message, obviously, diane, right to republicans, who have successfully blocked almost everything he s wanted to get passed over the past three years. and we ll be watching what happens when he says that tonight. thank you, jon. we turn, now, to co-anchor of good morning america, george stephanopoulos. george, what s the big picture for everyone at home tonight? the big picture is the president is coming into the speech with the best economy of his presidency, far and away. and the worst politics of his presidency. but it s about as low as it can be coming into this speech. congress, as jon pointed out, is still against what he s doing. and the country has given up on all of them. they re fed up with everybody in washington. he has to do one thing tonight, convince the country that he can actually get something done. and that s why he s showing the determination jon talked about. and we ve been looking at the pictures over the years. all these years he s been giving state of the union speeches. as you look at him and think about him, where do you think he is personally tonight walking into that room? a little more gray. we see that, for sure. and he s always been a measured, tempered guy. but i think you have more of that now than ever before. he comes into this speech tonight, with a clear sense of what he s done, what he can do and what he cannot do. a real sense of the limits of the presidency. we re going to be watching together tonight. want everybody to know at home george and i will be right here covering it all with our powerhouse political team. the president s state of the union address beginning at 9:00 p.m. eastern. but next, now, here tonight, we do move on. last night, we told you about the mystery onboard the cruise ship. hundreds of passengers sickened by a lightning-fast virus. tonight, new clues on how it spread and what the company has offered all those passengers, their vacation ruined. here s abc s linsey davis. reporter: onboard the royal caribbean explorer of the seas, anger is spreading as fast as illness. one woman onboard sent us this picture with the caption, feel like we re in a bubble. and sad thing is, they aren t even doing the right thing for us. we didn t go to half our ports. there were almost nothing to do on the ship, the days that people were sick. reporter: royal caribbean has apologized they are unable to deliver the vacation our guests were expecting. they re offering a 50% refund for this cruise and 50% off the cost of a future cruise. basically, we had two good days out of ten we were promised. reporter: they want their money back. but experts say, it s unlikely. is this rare for people to actually receive full compensation? the cruise lines don t have to compensate you at all. when they decide to compensate passengers, it s, so to speak, out of the goodness of their hearts. reporter: the stomach bug believed to be the norovirus is highly contagious. each infected person generally passes it along to as many as three other people. and so on and so on. leading to as many as 100 cases by the third day of an outbreak. on this cruise, the first case was reported last tuesday. by sunday, the number of people infected had reached 303. 24 hours later, that number more than doubled, with 626 people reported ill. today, that number shot up to 672 people. for the thousands on that ship, it s a vacation that simply can t end soon enough. linsey davis, abc news, new york. and we move, next, tonight, to a big medicine headline. for millions of americans using pain relievers. today, a new government report said the over-the-counter drug aleve, may be labeled the safest pain reliever for anyone with heart issues. the fda found the key ingredient naproxen, may provide a lower risk of heart attack and stroke, than a rival medication, ibuprofen, sold as advil and motrin. and with the super bowl now just days away, a startling discovery. a lot of counterfeit tickets to the big game are being sold. so, is there any way to catch them? abc s gio benitez, now, with the secret and the warning. reporter: fans, fireworks, and tonight, with the super bowl just days away, fakes. bogus tickets seized overnight. they look so real, investigators believe they could ve gotten someone into the stadium sunday. there was some really advanced technology there to make these tickets. some of the most advanced counterfeiting techniques i ve ever seen. reporter: take a look. this is a real super bowl ticket, side-by-side, with the fake one. they have the same artwork, the same foil-embossed logo, even an identical diamond-shaped watermark. so, how do you tell the difference? on the back of the ticket there s a graphic that s printed with something called thermochromic ink. when you apply heat by rubbing it with your thumb or your hot breath, it will disappear. as soon as the ticket cools off, it will reappear again. reporter: every year, as many as 200 super bowl fans are scammed with fake tickets. they are sold online, on sites like craigslist and in person, on the streets before game. vinny pasculli bought a phony super bowl ticket two years ago for 1,900 bucks. the pressure to get these tickets. and you see something, and, you know, you go for the deal. reporter: but as the counterfeits get more sophisticated so does the nfl. we re hoping to stay ahead of the counterfeiters as much as we can. reporter: this year s tickets have about 15 secret high-tech markings that the nfl hopes ticket counterfeiters never find. and heads up 3,800 real tickets are still up for sale tonight. gio benitez, abc news, new york. and someone got a kind of royal reality check today. the queen of england and her family. a scolding, new report warning them to start tightening the belt. they have apparently run through a fortune. here s abc s terry moran. reporter: think of the british royal family and you think of opulence and grandeur and magnificent events. you would never believe they re nearly broke. but they are. well, not them personally. but the royal household. the official department that runs all of their palaces and properties, 360 buildings, thousands of employees. a scathing report in the british parliament found that the queen s public accounts are down to less than a couple of million bucks. privately, she s still fabulously rich. but her public finances and her palace are a mess. buckingham palace looks great on the outside. but behind the scenes, this place is in desperate need of repairs. the roof is leaking. central heating needs replacing. and chunks of stone are falling off the building, endangering members of the royal family. the report demanded that the queen and her family tighten their belts and find ways to make more money, like by bringing paying tourists into buckingham palace. only open 78 days a year now. in contrast, the white house is open all year round. the queen s defenders say the royals make britain billions every year in tourism. and that elizabeth herself is a frugal housekeeper. at night, looking around the palace, and if there s some lights on, she goes and switches them off. reporter: she could always hock the jewelry. terry moran, abc news, london. and up next, right here tonight, caught on camera. drivers fighting back against speed cameras. do they sometimes say you re driving too fast, even if your car isn t moving? 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[ male announcer ] try campbell s homestyle soup. wow.look at you. i ve always tried to give it my best shot. these days i m living with a higher risk of stroke due to afib, a type of irregular heartbeat, not caused by a heart valve problem. at first, i took warfarin, but i wondered, could i up my game? my doctor told me about eliquis. and three important reasons to take eliquis instead. one, in a clinical trial, eliquis was proven to reduce the risk of stroke better than warfarin. two, eliquis had less major bleeding than warfarin. and three. unlike warfarin, there s no routine blood testing. 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[ male announcer ] ask your doctor today if eliquis is right for you. and next, here, tonight, caught in the act. almost two dozen states use traffic cameras to catch drivers speeding and running red lights. big tickets, big fines. well, tonight, surprising, new questions about how often those cameras are wrong. one city s launched an investigation because of so many mistakes. and abc s senior national correspondent, jim avila, shows you what you can do. reporter: it s the flash out of nowhere, when you don t expect it. sometimes when you don t deserve it. a baltimore intersection. this driver has clearly stopped. but the unmanned speed camera cites this car, brake lights on and traffic whizzing in front of it, for going 38 miles per hour in a 25-mile-per-hour zone. a costly mistake at 40 bucks a ticket. among the documented 10% error rate for speed cameras in baltimore. some individual cameras off by as much as 50%, according to an audit leaked to the baltimore sun that has the city council investigating. nationwide, about half the states use cameras. cheaper and easier than radar guns. but class-action suits in ohio and new york attack their reliability. los angeles stopped issuing camera tickets altogether. this maryland driver videotaped his speed, ten miles below the limit. the speed camera ticketed him for ten miles over. the car with the speed camera was approximately right here. reporter: schoolteacher erin grunden got five tickets leaving her maryland school. i was clocked at 51 miles per hour, which a math teacher figured out is physically impossible for me to have been going that fast. reporter: her 10-year-old honda couldn t reach that speed in the short distance from the school driveway to the ticket camera. in all, 22 teachers were ticketed here. if you give companies an incentive to ticket more, lo and behold, they will ticket more. reporter: california has banned per ticket fees. but advocates say cameras slow people down. some cities are using these cameras in new and different ways. this one is set up to monitor a stop sign, not a stoplight. if you roll through the stop, it will click. costing you cash, in a flash. even when the picture doesn t tell the story. jim avila, abc news, washington. and when we come back, next, right here the piano man, billy joel, doing something no rock star has ever tried before, in our instant index. imagine not getting out of bed again and again. and imagine finally taking control of your symptoms with the oxytrol for women patch. now fda approved as otc. it s safe and effective when used as directed. and it reduces frequency, urgency, and accidents. just imagine how your life could change for the better. take control with oxytrol for women. available in the feminine care aisle. so here s to the bride and. 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[ sneezes ] our instant index, beginning with this video we saw everywhere today. did you? all of us asking, is it a hoax? is it real? a white-knuckle experiment. a test of the emergency brakes on a tank, allegedly from the dutch military. 23 volunteers, a 62-ton tank, barreling towards them at 42 miles per hour. watch the horizon and listen. as the roar gets louder, only two of the brave souls even flinch and look behind them. today, we called the dutch military to ask why? and they told us, they re looking into it. but they re as puzzled as the rest of us. and the piano man, billy joel, back in the saddle, reaching for history. even you cannot avoid last night, kicking off a series of concerts at new york s madison square garden, as a kind of artist in residence. no one s tried this before. he s going to perform a concert a month, open-ended, going as long as the fans keep coming and the piano man is still up to the challenge. and we ve all seen all the rock stars on the cover of rolling stone magazine over the years. adell, dylan, michael jackson, beyonce. now, a different version of a rock star, pope francis. the first pope to make the cover. calling him the people s pope, the magazine put it best, saying, the times, they are a-changing. and up next, music from america s songbook. this land was made for you and me the man who sang and helped america build a nation. afghanistan, in 2009. orbiting the moon in 1971. 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[ male announcer ] you re welcome. ready? go. a body at rest tends to stay at rest. while a body in motion tends to stay in motion. staying active can actually ease arthritis symptoms. but if you have arthritis, staying active can be difficult. prescription celebrex can help relieve arthritis pain so your body can stay in motion. because just one 200mg celebrex a day can provide 24 hour relief for many with arthritis pain and inflammation. plus, in clinical studies, celebrex is proven to improve daily physical function so moving is easier. celebrex can be taken with or without food. and it s not a narcotic. you and your doctor should balance the benefits with the risks. all prescription nsaids, like celebrex, ibuprofen, naproxen and meloxicam have the same cardiovascular warning. they all may increase the chance of heart attack or stroke, which can lead to death. this chance increases if you have heart disease or risk factors such as high blood pressure or when nsaids are taken for long periods. nsaids, like celebrex, increase the chance of serious skin or allergic reactions or stomach and intestine problems, such as bleeding and ulcers, which can occur without warning and may cause death. patients also taking aspirin and the elderly are at increased risk for stomach bleeding and ulcers. don t take celebrex if you have bleeding in the stomach or intestine, or had an asthma attack, hives, other allergies to aspirin, nsaids or sulfonamides. get help right away if you have swelling of the face or throat, or trouble breathing. tell your doctor your medical history. and find an arthritis treatment for you. visit celebrex.com and ask your doctor about celebrex. for a body in motion. and finally tonight, we remember a songwriter who inspired generations of singers. from bob dylan, to bruce springsteen. pete seeger, his words, his banjo. urging americans to take up a hammer for civil rights and justice. abc s john donvan, now, on the man who put music to america s conscious. reporter: watch what pete seeger did here two years ago. where just for a moment, he stopped singing, mid-chorus. to everything turn, turn reporter: knowing, the words would get sung by everybody else. for the better part of a century, that was one of his goals, whether singing other people s compositions, like dylan s a hard rain s a-gonna fall. did you see my blue-eyed son what did you see, my darling young one if i had a hammer reporter: or his own, if i had a hammer, which peter, paul and mary made famous. i got a hammer and i got a bell to everything reporter: or turn, turn, turn, which was a huge hit for the byrds. a time for love reporter: the goal was to get everybody else up and singing. so, it was a natural, that he delivered to the civil rights movement, a song he collected from the labor movement and reworked, we shall overcome. we shall overcome reporter: he saw music as a way to motivate social change. by ripe old age, he had achieved full-on icon status. a hero to springsteen, who brought him on to inaugurate a president. that was five years ago. and still, he sang, until he stopped. once again, mid-chorus, but for good. though the words, of course, will still get sung by everybody else. john donvan, abc news, washington. and we thank you for watching tonight. we re always here at abcnews.com. join us tonight for our coverage of the president s state of the union address. coming right up. and we ll see you again on world news tomorrow night. i would hammer in the morning i d hammer in the evening this is an abc news special. america s possibilities are limitless. from so much hope. this was a pretty shameful day for washington. a year of anger and dysfunction. this republican shutdown did not have to happen. obviously, we screwed it up. nobody is listening to your telephone calls. challenges abroad. this initiative has the potential to remove the threat of chemical weapons without the use of force. and here at home. anybody in this country who works hard should have a fair shot at success. now, tonight, a chance to