L.G.: But I've seen you quoted as saying that young people do want what they want, and they want it now.

P.P.: I understand—that's part of the problem.

L.G.: And that's not your way. You're sort of old school.

P.P.: I'm old school in that way, but the fact that they want it now-life is a choice of alternatives. If they think that wanting everything now doesn't have any serious implications on the future, they're mistaken.

L.G.: And I think, by the way, in that context you were referring to Steve Schwarzman.

P.P.: In what context?

L.G.: Well, in the context that Steve had five houses and this and that, and just a lot of things.

P.P.: The last thing I'm going to do is be critical of a partner who's done a great job here as far as I'm concerned. Let me see where we were.

L.G.: You were just talking about the young people.

P.P.: Right. Nor do I think the parents have suddenly become crassly cold and indifferent to their kids' future. I think we have been disinformed, misinformed, denied, etc., all of the knowledge of this. We want to think of some youth leadership summits, for example.

L.G.: So obviously part of this component is a major public-education drive.

P.P.: Major public education. We've might identify several hundred or a few thousand—I don't know—young leaders from business, from academia, from wherever. And we bring them to New York, or take them to somewhere, and we present where we're headed, and then we can talk about how should they get organized. What should they do? Do we need a youth organization? Lord knows, the elderly are very well represented. How do we organize the young?

L.G.: So do you feel an urgency to get this discussion up and running so it has an impact on the presidential campaign?

P.P.: But this is going to be a problem that takes years. I don't think I'm naive about these problems.

L.G.: But now that the candidates have been discussing these issues in public forums like the debates...

P.P.: I wouldn't agree that they've been discussed.

L.G.: Can you force them into the discussion before November?

P.P.: The point is, if the public can become aware of the seriousness of the problem—what I call a major breakdown-and they start asking political leaders very informed questions, I think the dialogue can change. But I would say, the lack of serious discussion in this campaign is just another symptom of the magnitude of the educational and communication and motivational challenge we confront. We have something else we're planning -- Dave has been willing to participate over the last year on something called "Fiscal Wake-up Tours," and because he is perhaps the expert, or one of two or three leading experts, we plan to greatly expand that effort. We go out to the major cities in the country, get some of the political leadership, get some of the educational leadership, get the press, and take them through what the magnitude is of these problems.

L.G.: Tell me why John McCain would make a better president than either Hillary Clinton or Barack Obama.

P.P.: I watched the most recent debate and was very impressed with the intellectual horsepower of both of these people, both Hillary and Barack Obama.... I have been supportive of very much of President Clinton's fiscal policies. I'm a great fan of Bob Rubin and much of what they did during the '90s. Now, John McCain, more than any other candidate, I consider him a true fiscal conservative.

L.G.: When they left that office, they were forecasting a $5 trillion surplus.

P.P.: I know this. Hell, I go back to 1981 or '82, when I got into a lot of trouble in the Reagan administration because I was asked to give the inaugural speech to one of the Women’s Economic Roundtable. And so since I'm a relentless negotiator, this woman who was president had a house out in the Hamptons on Georgica Pond that my wife and I had always been interested in, and she was very ambivalent about selling it. So I said to her, "I'll make a deal with you. I will make this inaugural speech if you will sell me the house at your asking price." And she said, "Well, there's another aspect to the deal, which is that you have to do a thorough review of the Reagan budget." So here I am, I guess you'd call me a moderate Republican, a Rockefeller Republican, whatever. And we just got a Republican president who's just come out with this program. I'm supposed to analytically review the program. I made a deal, and I did it. And the more I looked at these supply-side expectative numbers, the less convinced I was that they made any sense. You know, huge tax cuts, huge increase in defense, the entitlements growing, and by '84, the motivational effects of supply side-productivity would go up dramatically and so forth. I didn't believe it then, and I don't believe it now. As a matter of fact, I say to some of my supply-side friends, "I don't understand how you explain what happened during the Clinton years, they increased marginal rates, but they combined them with very tough spending restraints, and it's one of the best periods we've ever had and we ended up with a big surplus."