and we had allies in these clashes. that is why starting the world anew, as obama imagined he does in most everything, pressing the reset button all over the world has consequences not the least of which is among our allies. for example, resetting relations with russia and caving in on the missile defense, men to be trained the czech republic and poland which had taken risks in joining us in this venture. it meant once again leaving them about american reliability and about our post cold war and their own post-cold war independence and whether now they were returning to the limbo where their sovereignty is constrained by moscow. ...

>> and almost without even.

>> the consequences, relentless pressure on israel was a non-issue of settlement to create gratuitous daylight between the united states and israel, precisely to gain favor with the palestinian and the arab states. hence, also the comedy of errors in honduras where obama reflectively supported as you go shove a hugo chavez wannabe and allied. while opposing the actions of nearly every constitutional institution in the country which had acted to depose a would be dictator, according to article 239 of the honduran constitution. hits, also, and i'm quite chocolatey, lebanon's recent demonstrations of fealty, to syria, syria had been ostracized by the bush administration for its role in the assassination that it is now with the obama

administration which is offering conciliation and the return of the u.s. ambassador. the pro-western and pro-independence lebanese know how to read wind direction. hence, the recent astonishing visit of lebanese president to damascus, to bend a knee to president hasan, the man he knows was behind the murder of his own father. but who is now the once again rising regional power. as the obama administration resets relations. with lebanon's syrian overlord. in combination with enemies is not a free lunch. it has its price. and finally, the piste of resistance of this policy of

extensive accommodation, iran were obama has consistently upheld the legitimacy of the thuggish clerical regime insisted on maintaining the good relations, and has been slow and often silent in support of the democratic demonstrators in the streets. the basic critique of this foreign policy is not just that it is naïve, and that it is unseemly stain of the american tradition of supporting democratic forces around the world, but that worst of all it has been a failure. we chose russia over eastern europe, and what did we get in return? cooperation with iran, nothing. and from china, from china in fact, we received explicit statements that they will oppose any sanctions on iran in the security council.

what have we gotten for our pressure on israel? the complete breakdown of negotiations. for 16 years the palestinians had negotiated with israel without a settlement freeze. until obama arrived to reinvent the world. the arabs now refuse any negotiation, as they prefer, logically, to sit back and let the united states extract unilateral concessions. from israel. this is only the beginning. in his first year we've only begun to see the fruits of obama's internationalism. but the signs are unmistakable. sure this policy continue for the next three years, let alone for the next seven, it will have profound consequences throughout the world. it would constitute a gradual american retreat. again, with the possible exception of afghanistan, although obama has pointedly

insisted that within 18 months the retreat from their begins as well. and it will have an actual consequences, easily and 60 li stated. went erstwhile allies seize the american umbrella beginning to be withdrawn, they will begin to accommodate themselves to those countries that we were protecting them from. so obvious are the these consequences of the disconnect between the real world and what president of france has called obama's virtual world, that is hard for me to be the that the current policies can continue. indefinitely. because at some point the empirical reality must intervene. the reality of iranians intransigence and aggressiveness, of china's headlong pursuit of its own

national regional and international interests, of russia's determination to regain its near abroad of the arab states to refuse any kind of reasonable settlement of the current israel has offered under several governments, a serious designs on lebanon, chavez is designed on the weaker countries in latin america. maybe i'm wrong. maybe this kind of a loser he foreign policy can persist indefinitely. perhaps obama will prove himself in pervious to empirical evidence, and to experience. in which case all these accommodations, the weakening of alliances, the strengthening of centers of adversarial power in moscow, beijing, caracas, tehran and elsewhere, will continue a

pace until some cataclysm links us up. such other wages of living in a virtual world, i pray, we believe it's a. thank you very much. [applause] for the excellent speech, you manage to cover every issue i was hoping you would touch. just what i thought perhaps we were running out of time you hit the right points. so thank you very much for that. we have some time for discussion, for some questions, for charles. we have a microphone over here. so if you would like to ask a question, please raise your

hand, asked for the microphone. it would be helpful if you could also identify yourself. >> chris from the young conservatives coalition. also professor at american university teaching a class in the history of the conservative movement. thank you very much for coming today and for all that you do. was wondering if you could expand your thoughts on little bit more on the u.s. foreign policy in the western hemisphere, particularly with hugo chavez and the consequences of obama's policies the next three to seven years if that's the case. thank you. >> i think honduras escapade was quite damaging, calling it ugly to without even considering what the conditions had been and what the constitutional realities inside of honduras -- it was a demonstration of where obama's instinct or. in the end, they lucked out because the would be dictator

proved to be so inept and so little domestic support that it fell apart that there was an election, which we come in the very end, accepted, which was sort of obvious we should have accepted it from the beginning as the clear solution to the issue. there's that which sends a signal about where we stand. i think there was some improvement towards the end that it was the first time actually where i think empirical evidence actually intervened over time, and there was sort of a maturation, if i could say, but at least the wrongheadedness had decreased, rather, slowly but effectively over time. that i think was the first example of crisis. the other i think interesting as how the obama administration will subordinate domestic

concerns over pricing international. one example of that is the free trade agreement with colombia. colombia is a classic example of a country overcoming enormous obstacles in the name of freedom. and doing it with great success against a neighbor, adversary. in the chavez who has been intent on damaging it. and here's a way in which we can express our support. both symbolically and material materially, without agreement. but of course, it is being held up because of the democrats, the influence of over the democratic party by the labor unions. so when one example is neglect. the other was sort of actively stated. i'm not sure that the crises are going to come in this

hemisphere, which is what i think it's on a lower scale of urgency, although i think it is wrongheaded, the direction are headed. but i think the internal problems that chavez has will probably restrain him, but it surely isn't going to be the united states under this administration. >> my name is robert. i am from the soviet union. thank you very much for your interesting lecture. my question is, growing up in the wonderful regime of the ussr, we looked upon reagan's movement to dismantle or to break down the berlin wall as something extremely helpful, and unrealistic at times. and actually i watched the celebration of the berlin wall, dismantle. there was no mention of president reagan nor margaret

thatcher, nor any of that effort, except communist gorbachev was celebrated. mr. obama mention himself three times during his speech. so, do you see a problem in rewriting the history and why there hasn't been any resistance on our part to sort of counter -- counterattacked the effort to rewrite what took place in 1980s? >> well, i think that's a very telling comment you made. and it was a very telling instance, the president of the united states removes himself to copenhagen to bring home the chicago olympics. it removes himself to copenhagen for climate change. he removes himself to oslo to receive a prize, but he doesn't show up in berlin on the 20th anniversary of an event of biblical proportion, one that i'm sure most of us in the room would never imagine we would ever see.

that shows you how he sees the world, reinforces that quotation. i mean, i could have used one of dozens. but the one i chose it from was the address of the general assembly, in which you can see his priorities. and to speak of the cold war divisions, sort of arbitrary and not to see how rooted they were in the fundamental values of the united states and the west, as cleavages of some obsolete conflict, is simply staggering. but it tells you a lot about his worldview. and i thought the berlin event was very, very telling. particularly, as you say, leaving out the great figures that reagan, thatcher, pope john paul, sharansky, sakharov, and others. gorbachev was the hapless caretaker. to his credit come he didn't shoot people in the streets.

that's the only -- and i give him credit, because you have to make a choice. but the unraveling was our doing. and it was the pressure that was applied relentlessly. and i would remind people who don't remember then, everyone now is a post-cold war cold war your. like in france, the ones who are underground after the war. people forget in the 1980s, the enormous struggle that reagan, thatcher had. the largest demonstrations in american history. there was one in new york against reagan's nuclear policies. it was a freeze demonstration. the demonstration, thatcher had to face it down when she approved the placement of the persian and the cruises. all of this is forgotten as if everybody was on board and the pressure applied on the soviet

union. it was extremely partisan, the arguments, over all of those measures. the reagan doctrine or the contras. and that history i think you're absolutely right has been obscured. and largely forgotten. >> israel has stated that a nuclear armed iran is an existential situation for them and it appears that europe and the obama administration have more or less accepted a nuclear armed iran. do you suspect that israel will, in fact, attack? and if they do, how do you foresee the consequences of all of that happening? >> i think in the end israel will. and the consequences will be very, very grave.

the only question i think for the israelis not is a technical one. can this be done? do they have enough intelligence? is the stuff that's critical accessible by air attack or not? do they have the resources, the refueling capacity, to do major damage that would set them back a few years that the israelis are not imagined they will get a solution but it gives them time. when you are a small country, and you have a history, the history that the jews have, even a few years is important. even if you have to -- if you only have a temporary respite. but what will happen is predictable. the iranians will try to strike back. probably scuttle ships in the persian gulf to shut down the oil. trade, double the price of oil

around the world, set off a worldwide recession, unleash hezbollah which probably has about 40000 rockets to attack israel. hamas would do the same from the south. so involve israel into beriberi hot wars immediately. it will be very dangerous and difficult. for the israelis a very hard choice to make. nonetheless, i find it almost impossible to believe that they will accept 6 million jews living under the threat of nuclear annihilation, particularly given the history of jewish people. and i think that will trump all other considerations. they can deal with the other problems, i think they think, which are at a conventional level. they have dealt with those in the past. but a nuclear country pledged openly to the eradication of

israel, and the killing of all its inhabitants. is a threat that i don't think the israelis will live with. >> we have time for one more question. >> charles, i just want to thank you for your contributions. your listeners learn from you and also love you. my question is this, relative to spending. what happens in 2010 if the chinese decide to not show up at the auction block to buy our bonds? >> two questions. on the apocalypse? [laughter] >> i'm not sure the chinese would do that. it's not in their self interest. you, it's the old joe, if you owe the bank $100 you can't

repay, you're in trouble. a few of the bank of billion dollars and you can't, the bank is in trouble. we are sort of locked together. i mean, i think the threat over time is that they may try to wean themselves off the dollar, maybe look for a basket of international currencies and we will lose our places, the kurds in the world, of course is a huge advantage for us. but it would be catastrophic with the chinese, because if they send a dollar into a spiral, they are holding a lot of dollars. that evaporates. there were is where going to inflate our way out of our debt so there will be a gradual loss of the value, what they are holding. which is why i think if they are klauber in the long one, they will try to sort of diversify that they're holding the dollars into other currencies. but to not show up at the auction and to essentially unload the debt, their dollars, is a way of impoverishing not

just us, but then. so i'm not sure it's a sort of mutual assured disjunction. you know, the old, would apply the nuclear world with the soviet applied here economically with the chinese. and they are a very rational people who have a very long range view of history. we look to the next election cycle. the chinese look to the next century. >> charles, thank you. we will be publishing charles' speech as a thatcher center lecture. probably in a matter of a couple of days when you approve of it. charles, thank you very much for being here today. thank you for your excellent speech. we hope to hear your strong voice for many years to come. and i'd like to thank all of you as well for coming here today, and hope to be able to see you again at our next thatcher lecture series. if i could ask everyone just to remain seated for a moment while we exit. thank you very much. [applause]

[applause] >> we want to thank you for joining us today. it was a remarkable lecture. we do thank you for your kind attention at all of our events. we remind you again, heritage has its launch at the index of economic freedom tomorrow with a rather significant lead story, so do watch for that in the news. somethings are a little different this year than in past. we do thank you for your kind attention. we are now adjourned.

[inaudible conversations] [inaudible conversations] and a schedule update for you today at 1:30 p.m. eastern press secretary robert gibbs will answer questions from reporters here at the white house. you can see the briefing live here on c-span2. also coming up at 2 p.m. keeshan, the u.s. house gavels in for legislative work on several bills, including one that extends bureau of land management contracts with timber companies.

>> a group of economists on the nation's largest banks gathered at a conference last week to give the economic forecast and predictions for what the federal reserve will do this year. among them, stuart hoffman ,-comconchita dominus of pnc financial services who says the economy will gaif jobs in the private sector. it's an event hosted by the american bankers association, and it's 40 minutes. >> good morning.

i am with the public relations department here at aba. i want to thank you all for coming. hopefully you all got a press packet that if not there are some outside. just to let you know, my card is in there. if you have any follow-up questions after today's conference about the forecast today or any other matters, friendly, feel free to shoot me a call or an e-mail. also, we are making the fork is available online later today. if you want to go back and take a look at that, it should be posted sometime early this afternoon. now i'd like to turn it over to jim who is her chief economist here at aba. >> thank you, peter, and let me add, my welcome to you to be at the aba today in our boardroom. it's been a great pleasure over the last day and have to meet with our economic advisory committee. its 14 members, and it really is the chief economist of the major

banks in our country. they meet twice a year. they will come back in june as part of their meeting, we meet with some government officials and in particular, we meet with the federal reserve board. i will tell you our arrangement with the federal reserve board is that is a completely off the record conversation, and i would ask you not to ask what the board may say. you should ask the board yourself of what comments they may make. and i'm sure you will be excited about the response. but it is off the record, and we respect that as the fed does. as well. essentially what you hear today from our chairman is a presentation that was made to the board. so you are hearing are forecast that was developed over the last day and have. what i want to do is introduce some of the members who are able to stay over today. they would be available to you for interviews or discussions following the press conference

with stuart. so first, jim vogel, ftn financial. scott anderson from wells. scott brown, raymond james. dana johnson from comerica. and george from huntington. and with that, let me turn it over to stuart hoffman who is our chairman. >> good morning, everyone, and thank you, jim. welcome to all of you. appreciate you joining us this morning here. as jim just told you, argubright had a busy day yesterday. spent most of the morning and early afternoon discussing our outlook for the economy and in your packets, both a press release and there's a table summarizing the forecast and the important variables that we have talked about and issues.

and that's what i'd like to discuss with you today briefly. and of course, that open it up for questions. i will talk about what i think with a six most important points that we talked about that came out of the forecast, but also the differences of opinion as we would put it, this sort of dispersion around the forecast you see here, which is a medium, as jim said, not all 15 of us were there, but i believe there were 10 of us there yesterday. so around that median forecast. clearly there are differences of opinion and i want to try to bring them out as well. the first point is, as the headline said, the group feels that economically recovery that began probably the middle of last year, not officially designated yet, by the mbr, but we feel that economic recovery will be sustained throughout 2010 and hopefully beyond. and so we're not looking for a double dip or the downside

relapse back into recession. so we do think economic growth which has begun can be sustained. the rate of growth in terms of real gdp, median forecast for this year, the fourth quarter, was 3.1%. which while we don't have the fourth quarter date yet for gdp, if it is around 4% as of this committee thinks, plus the 2.2 in the third court would mean economic growth in the latter half of last year, gdp growth, should be coming in somewhere between three and 3.5%. so our forecast is a sustained economic recovery around that pays. but i would emphasize as the committee did, that while that recovery is welcomed, i refer to it or i characterize it on my own, but i think the committee agreed, what i call it half speed economic recovery. because 3% economic growth, while welcome, if you look at the recovery following past deep recession in the u.s., and

surely this has been a deep and broad recession that preceded it, you might expect real gdp growth in that first four to six quarters of recovery to be as much as six or 7%. so we don't lose sight of the fact that while a welcome and sustained recovery will be very helpful, it is being restrained from the very rapid advance with more typically seen following past deep recessions. second point that we make is we do expect that we are on the cusp, the economy is on the cost of private-sector job creation. . .

from the public sector, which clearly has helped as a catalyst monitoring fiscal stimulus, along with, and maybe even preceded by improvements in the financial community and financial conditions have stimulated or been the kindling for economic growth but for it to be sustained, the private sector, private consumer spending, business investment, exports, housing, that has to take up the slack and we think that hand i don't have will be successful. it won't be fumbled and economy thrown back for a loss. we talk about that as well in the press release we think we're in the process of seeing that occur, even as fiscal stimulus we see

787 billion of a year ago, begins to wane in the latter half of this year, and, as at least in our forecast, the federal reserve becomes what i would call, less accommodatetive in their policy than they have been. the third point is on inflation. the committee feels that inflation will remain well-contained. in 2010 and 2011. we used a core pce deflator, which is figure we focused on. forecast somewhere around 1.25 to 1.5% over the next two years. indeed the cpi that came out this morning, that of course was for december, .1 on the total. .1 on the core we think is some example of the relative stability taking out, especially the big up and downs in oil prices that containment in inflation will continue and, that is a positive outlook within our

forecast. forth, just to give you a little sense of the distribution around this committee's mean forecast and, what we, we showed you the numbers but sort to put ourselves to the test, i would say, maybe not like many other economic forecasts of a collection of economists. there is a little wider range of opinion around the central tendency, that is probably even true in the fomc's forecast it puts out. if 3.1 is our real gdp forecast, when we polled the committee whether they thought the odds favored it being 1% stronger versus 1% weaker, actually five thought it would be stronger, or the odds would be greater it would be stronger and only one thinking it would be weaker. so there is a little bit of skew in our distribution actually to the upside in terms of real gdp but even 4%, if it were that, would

again, be a little more than half but wouldn't be sort of a normal rapid economic recovery. on inflation we did the same thing. 1.2 is our forecast for the pce deflator for this year, fourth quarter. again, asked if you thought, each committee thought it might be the odds favorite of it being half a percent higher or a half a percent lower. actually seven thought it was more likely to be half a percent higher and only one thought it was likely to be half a percent lower. so again a little bit of skew to the upside although i note 1.7 on the core deflator might still be interpreted as being within bounds from the point of view of the feds long-run goals on inflation. so there is clearly distribution around this. fifth point, credit delinquencies and charge off-s in the banking industry expected to improve

this year. modestly both consumers and business credit. over next six months, which is way we phrased the question, talking about credibility, credit availability, our members thought or at least pretty large majority, overwhelming majority thought that credit availability would slowly improve both for businesses and consumers over the next six months and i suspect over the next year as well, and that the quality of lending, quality of conditions on consumers with probably be stable and might actually improve a little bit the quality of credit for the business side. and finally the 6th important point was the point was about the fomc and the fed. our group collectively expects the fomc to start raising the fed funds rate from 0 to 25 r5i7k. sometime probably late in the third quarter, and, by the december 14th fomc meeting, the meeting and

forecast was fed funds rate of 3/4 of 1%. i would also say there were some significant differences of opinion within the group around that as often hidden by medians. four of the 10 actually did not think the fed would tighten at all this year and therefore, the fund rate would still be 0 to 25 basis points. but four out of 10 also thought the funds rate would be at least 1% or higher. so clearly the 3/4 is somewhat as often happens, is sort of a midpoint after little wider range. so clearly there are some differences of opinion. we did think that mortgage spreads would probably widen relative to treasurys and at least those of us who thought that the fed would tighten a little, thought that the treasury yield curve, the slope between the t-bill and a 10 or-30-year treasury would flatten a little bit as we went through the year. so that was our thoughts on

the federal reserve. at that point i've given you what we viewed as most important highlights. i'm going to stop there. be glad to open it up to your questions. thank you. yes, sir, start right there. >> you talked about the recovery not being as robust as coming out of past recessions. why? >> yes. >> what are the reasons for that expectation -- >> would you repeat the question? >> the question was, why it might not be as robust. i sort of view this as a balancing act. you might have also asked me why is there going to be any sustained recovery because clearly there are forecasts out there of relapse in the economy will fall back into recession. so the coral laurelry question would there be recovery -- corollary? the answer would be the we have balance of factors. the reason we have recovery we talked about, there will

be hand-off and private sector hiring. there will be some business investment. there will be some improvement in housing. what are some of the restraining factors, what i call potholes on the road to are therery rather than roadblocks that would prevent it? we know that consumer spending will still be constrained by high unemployment and difficulty that's causing and you know, the, let's just say, won't say lack of confidence but the caution that consumers feel and the determination to raise their savings rate. so, consumer spending while we expect it to grow 2.5% is still what i would call moderate and not rapid indka of splurge you might have scene a fueled more past rapid recoveries. the other would be we talked a little bit about commercial real estate not turning around and being somewhat of a drag on the economy. we talked about it as a risk, higher oil or energy prices that could dampen economic outlook. and, certainly, even in our

view of job growth. in the forecast there will be job growth. the job growth is not rapid, rapid enough to take the unemployment rate and maybe bend it down a little below 10% by year-end. a lot will reflect growth in labor supply. while there are factors of sustained recovery, the three or four i listed are moderating or impediments on that recovery being sort of the rapid recovery we all hoped for in at least the aftermath of this deep recession. yes, jim. >> stuart, congress and other policymakers who look at this data, you talk about a hand-off from the public sector to the private sector in job creation. should they have second thoughts about further stimulus and job creation packages, or might that actually help accelerate the pace of gdp growth and might

they benefit us by having more stimulus. >> jim, we certainly talked about that as you might expect, whether there be another fiscal stimulus or jobs bill. we had talked about the extension of the home buyer tax credit. i think the group felt that was a good idea, that that was done extended from when it would have expired late last year through april or threw closing by middle of the year. but i think there was a mixed opinion tee pending how weak or strong each individual's forecast was. but my general impression was to give, consensus of the committee to give it a little more time. that a lot of fiscal stimulus is 787 billion from a year ago was just kicking in now and indeed, a lot of the momentum from that was occurring in the first half, into the second half of the year. so while we didn't make any definitive statements about it up with way or another, i think the sense of the committee was, if we see in

a couple, three months, we're not getting private sector job growth, then, it might be a more urgent need or more prudent to move on additional fiscal stimulus, on the monetary side. it is pretty clear. we all expected that the federal reserve to remove as they have laid out, some of these liquidity facilities and pare them back and, as i've said there was quite a difference of opinion whether the fed should actually raise the funds rate which i would characterize as sort of lifting the pedal to the metal and, you know, that but doesn't that occur until later in the year. so consensus was, let's wait a little on fiscal stimulus. i think we can. and, on monetary stimulus, or the current stance of monetary policy should be left alone, at least for the next six months. >> stuart, -- from bloomberg. you talked a little bit about hand-off from public to private being more sustained. you talked about the hand-off from terri, private

growth factors to more sustained ones. specifically inventory cycle rebuilding and pent-up demand toed growth. >> the question was, the question was about the hand-off i think you mentioned temporary, i assume you're referring to some of the temporary help numbers have gone up as opposed to full-time hiring. again we didn't discuss that at length but there was a feeling which is fairly well-known sequence when gdp starts to recover, typically, initially there is productivity and we've had that in spades. we've also had some temporary hiring. there is some improvement in the hours worked or more people moving from part-time to full-time or even more hours even if they're still not full-time. we saw some evidence that that was occurring. we did think that give some of the uncertainties in washington as those are perhaps cleared up, that, that movement would continue a little more and that is why any private sector,

full-time hiring starts very slowly although it does start, and then, over time, as more part-time people move to full time, as maybe more temporary help are offered full-time jobs as businesses feel a bit more confident about the sustainability of recovery and see it in their own top-line growth, that's where the transition occurs. that creates labor income both in terms of new people working, in terms of people who are working now, working more hours or working longer work week. that does create labor income and in an environment where inflation is still relatively under control, we think that creates real income and, spending power. but as i mentioned here, we temper all of that, recognizing how high the unemployment rate is and the consumers clearly want to increase their savings rate, and so therefore, even if they do get labor income, they're not going to be spending 100 cents on the dollar, probably more like

95 cents on the dollar as they try to increase savings as they have, back up towards around 5% at least as measured in the income and consumption data. yes? >> chris -- at ap. i want to follow up on some of the employment discussion. sounded like you see, you guys see some private sector job growth certainly. >> yes. >> but not a lot to necessarily bring down the rate very quickly. is there, where do you see the hiring happening? is this going to be based on large companies that are exporting? did you guys have anymore sense of who might be hiring then this year? >> we did not talk in a lot of detail about different industries and certainly not company by company i think we did feel some of it was less job losses in some of the areas you've been seeing it in manufacturing and construction, and probably greater job gains than

you've seen in the eds and meds. education and medical care. perhaps some improvement in jobs in the retailing industry as we have this modest growth in consumer spending. some in professional services, whether accountants, attorneys, you know, consultants. people of that. maybe a few in our own industry of financial service although we didn't specifically discuss any forecast of jobs in our industry. but, i guess i'm going to say, it is more service than goods. can definitely be in the energy-related industries. different types, production workers, engineers. so, it was fairly broad-based but admittedly more service than goods. and, again it would start slowly because of hiring process is just beginning, even if a lot of the lay-offs have tapered off. companies are still going to be slow to hire. that's why we get small increases but, you know, it was not all in education or medical care, and certainly

we said private sector so we're not referring to any government jobs, either permanent or temporary, for the census. although, you know, those do create income. those do create jobs and those individuals, depending on what they over the wise going to be doing may have jobs and income than they wouldn't have, but maybe a different mindset about it than if it was full-time employment. yes? >> was there any discussion about interest rate risk for banks as a result of the federal fund rate possibly coming back up during the year? >> question about interest rate risk for banks. not specific. we're still starting from a extremely low levels, and spreads are still quite wide. now, i don't mean credit spreads have narrowed quite a bit from the panic a year ago but say the treasury curve or libor rates are still fairly sleep. steep. so we really didn't talk about the interest rate risk into the banking industry

and certainly not to individual banks. i think we did say we thought the rise in interest rates, reflected some, as i would phrase it, some improvement in the health of the economy. interest rates are so low and again this is my term. when i talk to pnc clients. i talk about interest rates being low as like your heart beating 40 beats a minute. that is an anemic beat. we don't want interest rates to slow. a healthier economy would have a bit higher interest rates, real rates, not necessarily inflation, so actually a modest rise in interest rates, especially starting from such low levels at short end is more of a sign of recovery and not a threat to recovery unless it is occurring much more rapidly than we think or occurring because of some outbreak of inflation or much worse inflation expectations. yes. >> i'm wondering what sort of policy initiatives you took as givens in coming up with this forecast?

and what major legislation, like say, an energy bill with a cap-and-trade, how that might interrelate, how that might effect your forecast if it were to pass? >> a question about policy assumptions. you know this is a one-year outlook although we do also try to look out into 2011. i think assumption was although maybe not made explicit, if there were changes in policies, they probably would be effective much later this year or next. we did not specifically address cap-and-trade. we talked a little bit about health care, like everyone else, waiting to see what might come out of conference committees. so we didn't have any specifics on that. we did assume there would be tax hikes, with sunsetting of bush tax cuts at least at upper end of the income were likely to take effect as scheduled in 2011. so we're mindful of the fact, i think built into here that rates will, tax rates, with

top marginal tax rates are likely to rise in 2011 a as scheduled. so that doesn't require legislation. just something to the contrary to prevent it from happening. those are some of the issues. catch and trade not so directly. again, ask about whether additional fiscal stimulus. we didn't specifically build in a number or not build in a number but i guess implicitly, we weren't assuming any additional fiscal stimulus in our forecasts, in the very near term. yes? >> reuters. could you comment on consumer sentiment and how regulatory reform efforts are impacted if at all? >> we didn't specifically talk about regulatory reform efforts affecting consumer sentiment. i think we all agreed consumer sentiment is still quite restrained and that if we do have some private sector job growth, that helps a little by all means on the margin. as we've said the

unemployment rate is still painfully high. and that is one of the reasons we talked about, at the beginning that consumer spending will be a force for recovery, but, not a rapid recovery. in fact consumer spending, forecasted to grow less rapidly than the economy over all. so consumers are contributing to, but i wouldn't say leading this economic recovery and in part because the sentiment is still being restrained by house prices that are down and even with the rally in stock market or other invests, still concerns about jobs and, so we looked at consumers, sort of a balanced picture. certainly not going on any spending spruce but having enough confidence in some income growth, and, some improvement in investments to be able to spend, at a moderate, what i call cautious pace. but that's, where the sustained part of the recovery comes from, but not, a robust or rapid part of it.

>> my name is --. let me ask, general question. many people are still talking about the kind of, concern of, lofty gain in the coming years. seems you don't support this kind of idea. this kind of argument. why is this so long? and, the second question is just -- how do you estimate the up gap of this economy in this estimate? >> yeah. on the question of the lost decade, looking ahead, not behind, we did not address that directly. i think the general feeling was, or i could maybe more speak for myself that, i'm not anticipating this to be a lot of decade in what sense you mean that in terms of whether job growth or out put growth or value of homes or stock prices or distribution of income, but clearly our forecast was

focused on what i call near-term cyclical economy of next couple years. so i really can't give you an answer to the first question that would reflect the committee. on the second -- >> -- issues? >> we talked about structural issues in terms of the some of the deficit issues and structural issues in the economy. we did not come up with a forecast but we did not poll the committee as what we thought that might do in terms of growth rate of the economy. i can try to answer a little bit in getting to your second question, which is, if you look here, the full employment unemployment rate is been moved up a little from this committee to 5.4%. still well below where it is now but potential long-term gdp is 2.6%. we might have shaved a little bit off of that compared to this committee a year or two ago. 2.6% if we think of that as

long-run potential growth doesn't sound to me like a lot of decade. so we didn't directly talk about that, implicit in our discussion and long-term view not necessarily to live up to it but the in our view the potential the economy would not have a decade of lost growth and end 2010 with gdp in real terms where we began the decade or this year. question? >> specifically, with respect to questions about health care reform and costs associated with it is that acting as a damper on permanent hiring and causing firms to extend temporary hires at the cost of permanent jobs which might give consumers greater incentive to spend? >> clearly we don't know for sure but i think the committee felt that the uncertainty surrounding health care and cost of it which may may be cleared up very soon. we say markets and

businesses certainly don't like uncertainty. they might not like uncertainty what they hear about, but the point is they don't know for sure. there was certainly some discussion and shall we say conjecture that, some of what might have been holding back private sector hiring is a clearer view of, not only health care costs but some other policy issues. but clearly we, as we said, we think we're on the cusp of hiring and, we think it is a full-time permanent hiring, and so, if it has been uncertainty holding it back, in part the top-line revenue growth, improvement in the economy and maybe some clarity in that quote, health care uncertainty, is what helps break a bit of the logjam to where we see, slowly, businesses starting to hire, at least to the extent, greater extent than they lay off and we see small gains, in this case we're talking under 100,000 a month upon average in the first quarter, but i guess i would say that would be a

welcome change to have a plus in front of the friday, once a friday or first friday of every month employment report, as opposed to a november number plus 4,000, plus something that had a few more zeros behind it. yes? >> said you discussed tax policies -- from dow jones. tax policy and impacts to the economy. >> yes. >> did you discuss specifically the bank tax and impact on the industry? >> we did. not in the conjunction with this forecast especially since even as it is proposed it is not going to take effect if it does at all, until 2011. admittedly our forecast we're focusing on in the coming year, but i'm going to ask jim chessen from the aba i will hand off to him and he can talk about a bit of the discussion and some of the aba's position. >> thank you, stu.

on the bank tax we were obviously very concerned about the announcement that came out and troubled by it. part of it is just the misperception of the tarp funds from the very beginning in fact. if you separate out the tarp funding for banks, versus non-banks, you have a dramatically different story. on the banks side there has been about 225 billion provided to banks on the tarp side. 2/3 of that have been repaid. with interest and dividend and warrants already exceeding $15 billion. and the treasury, a month ago, said that they expect there to be a profit on every single program devoted to banks. and they expected that profit to be in excess of $19 billion. if you look at the non-banks side, where they have had almost the same amount of

money, a little over 200 billion, provided to the auto industry, aig, they have received only 4 billion back from the money provided there. all the losses expected are for non-bank programs. not from the banking industry. so we're concerned that such a high tax, directed at wrong parties, will have serious consequences. and it will have consequence. this is an enormous tax at a time when institutions are doing their very best to provide loans to their customers, to help stimulate this economy, and we believe it will have a very serious effect on the entire banking industry and their ability to easily meet the needs of their customers. stu. >> there is a fact sheet with this information. some of the numbers jim mentioned john has it in the

back if any of you want a copy. >> thank you, jim. yes? >> -- budget deficit going down to one trillion in 2011. >> yes. >> how concerned are but the deficits and will the recovery be sufficient to bring the deficit-gdp ratio down to about 3%? >> we certainly talked about the deficits. there is a concern, more in terms of a risk level that there was some discussion that a worse deficit, particularly as a function of a weaker economy, could put more upward pressure on interest rates at least from the point of view of additional supply. you're right, these are huge numbers. we did not talk again about the next three to five years and how you get the deficit down. we certainly talked about the rate of growth of government expenditures. as, probably in our opinion as a committee, still, too

rapid. and that one way to reduce the deficit would be to slow the rate of programmed expenses. clearly there is some improvement in the deficit built into this forecast from the revenue side of just, a growing economy, absent any, you know, policy tax changes like the ones we talked about. so clearly we talked about the deficit. i think that the drop you see here is what i call a little more indigenous, in the sense it reflects higher revenues from a growing economy and maybe less expenditures, particularly as you get into 2011, in terms of unemployment compensation and of course as we said, in 2011, our expectation is that there will be higher marginal tax, income tax rates and that is likely to raise some additional income but also might be a reason why that consumer spending growth remains restrained, relative to the, to the spending spree that might have occurred or to pent of up demands built up. that consumers will not have the wherewithal to go on that kind of spending spree

and all the more so if tax rates are going up in 2011. jim? . . and certainly i think the implication is in how that will affect voting. i think our forecast would be that the recovery will feel more genuine. the unemployment rate will still be very high. there will still be a lot of unemployed. so i can't say from a voting pattern how that will be and we didn't necessarily discuss that.

>> but still high and still clearly prevalent in a lot of individuals who have yet to get that, you know, benefit in their home or in their wallet of the economic recovery. yes. >> what you were just saying, you seemed to be forecasting job growth but still a very high unemployment rate. within job growth you're seeing higher unemployment. that implies more people are coming out of the nonworking part of the labor force into the labor force working but it doesn't change the fact of numbers working. can you address that a little bit. and say what are the

implications of that? >> yeah, we do have the unemployment rate coming down a bit. i mean, it's 10%. i guess it was in december to use the quarterly average and 10.1% in terms of quarters. if you run your eye across the forecast of the unemployment rate by the fourth quarter of this year we have it at 9.6%. so the job growth that we see -- the private sector job growth is more rapid than the labor force. obviously, the unemployment rate is the ratio of job -- or people with jobs to people in the labor force, meaning they have jobs or they're looking. so, yes, we assume as is typical in a recovery and in a growing population there will be labor force growth. that's why the job growth of about 2 million for the year at least in the fourth quarter, only brings the unemployment rate down a few tenth of 1%. because i guess if we did the calculation, we'd probably figure the labor force will grow

around 1.5 million. so the difference of half a million people that are getting jobs that are growing in the labor force is your equivalent around 3 and 4 depending on how you drop it around it tends to decline in the unemployment rate. so, yes, we certainly think labor force growth will be occurring. and some discouraged workers may be coming back in. the so-called underemployment rate could be ameliorated a little bit by people who have been part time working full time and people who are working full time and are getting more hours but our forecast acknowledge that the growth in jobs again in that sort of half-speed theme is welcomed but not much more than it takes just to keep the labor force blind. -- employed. and maybe a half million more and that's why the rate doesn't go up anymore but doesn't come down very dramatically either. any last questions?

i'm going to turn it back over to jim. or peter. >> thanks again for everybody for coming. both stu and some of the other members of the committee will be available for some questions. jim will be available as well. and again my cards are in your packet if you have any follow-up after today, please feel free to reach out to me. thanks. [inaudible conversations] >> today at 1:30 press secretary robert gibbs answers questions

see that briefing live here on c-span2. at 2:00 pm the house gavels in for work on several bills. >> now remarks from environmental protection agency administrator, lisa jackson.

on the epa agenda and how she plans to run the organization. hosted by the women's national democratic club in washington. this is 45 minutes. we'll show you as much as we can before our live coverage of today's white house briefing. it's scheduled to begin at 1:30 eastern. >> okay. [laughter] >> okay. we are honored to welcome the environmental protection agency administrator, lisa b. jackson. she leads epa's efforts to protect the health and environment for all americans. she has pledged to focus on core issues of protecting air and water quality, preventing exposure to toxic contamination in our communities and reducing greenhouse gases. she has promised that all of

epa's efforts will follow the best science, which i guess is a change. adhere to the rule of law. and be implemented with unparalleled transparency. she has made it a priority to focus on vulnerable groups including children. the elderly. and low-incomed communities that are particularly susceptible to environmental and health threats. in addressing these and other issues, she has promised all stakeholders a place at the decision-making table. before becoming epa's administrator, a cabinet-level position, ms. jackson served as chief of staff to new jersey governor john s. corzine. and commissioner of the state's department of environmental protection, dep. prior to that, she worked for 16 years as an employee of the u.s. epa.

she is a summa cum laude graduate of tulane university. and she earned her master's degree in electrical engineering from princeton university. she was born in pennsylvania. and grew up as a resident of new orleans. louisiana. she now resides in washington, d.c. she is married to kenny jackson. and is the proud mother of two sons, marcus and brian. governor corzine said of her after her confirmation to head the epa, the american people have gained a timeless public servant and a tenacious guardian of the government. oh, she's here. maybe i can leave the last quote until she enters the room. [laughter] >> because i can see cameras flashing so she is here.

this is a direct quote -- [applause] >> hello. ms. jackson, i took the liberty of making an introduction about you to the audience before you arrived because i didn't think you need to hear your own biography. [laughter] >> but i'm going to now end with a quotation from you. this is a direct quote from ms. jackson to the associated press. it's about me trying to figure out what i would like people to say about the lisa jackson epa when i'm done. and i want them to say, you know, she really opened that agency up. she really made waves that lift past her for that agency to

speak to people of color. to speak to the poor. and to make sure their issues are taken into account. let's welcome lisa jackson. [applause] >> well, this is efficiency. i mean, we're democrats. but we're pretty efficient here. [laughter] >> well, thank you so much.ws÷ obviously thank you to the president. thank you for having me. and thanks for giving me an opportunity to just share for a few minutes some of the things we're doing at epa. and make sure you -- you're aware of how important all your efforts are for change. and how that's come to be. is that better? okay. good. and please allow me to do something i rarely do, which is introduce my chief of staff,

diane thompson-long around in many circles. [applause] >> i honestly spend some portion of every day -- she doesn't know this -- wondering how i lucked out. and what i did to deserve her. but she is extraordinary. and she's a teacher and a friend. and to elaine, i don't know where she went already. but a former -- elaine newman who used to work at epa -- there she is. for having the foresight of saying, yes, it would be wonderful to have us as well. so it's great to be with you this afternoon. this group has played a strong role not only in the history of women's rights and empowerment but in the history of america. so thank you all for carrying the torch today. i happen to work in a field that has benefited greatly by the work of amazing women. in the 1930s, it was a woman named rosa lee edge who took on the established notion of environmental conservation. and her work taught the nation

the importance of preservation and environmental protection.oc7 she did that at a time when women really didn't raise a voice on these issues. she was standing on the shoulders of other women. and then other women stood on her shoulders. women like sill vea earl and marjorie stoneman-douglas and jane goodal who are leading advocates for the environment and for protecting our health. and, of course, rachel carson who has a room named in her honor at epa headquarters. and who was a transformative figure not just in the history of epa but in our country's moment of turning to address the urgency of environmental challenges. her book "silver spring" changed environmentalism forever. and i don't think her -- it's a coincidence that a book that came out in the '60s by 1970, there was such a thing as the u.s. environmental protection agency. so obviously these women played

an important role in epa's life and in mine at least indirectly. but you need to know a little bit about me as well. and it's the thing that i hate doing the most, so bear with me. i started at epa over 20 years ago. and i will make you laugh and say i thought i would just go because as a young professional woman the federal government was and remains a wonderful place to have a career. and i thought i'll go for a few years. i'll punch my ticket. and then i'll go make a lot of money out in the big, wide world. and i did. i started as a staff-level engineer. i had just finished graduate school. it was still a time when you didn't see a lot of women engineers in general. there were, i think, two women engineers in my entire graduate school class. and two in my undergraduate school class. and that was a shock 'cause i'd come from an all-girls high school. so i moved into this field with almost no women and very few people of color.

i felt as many women do a call to service. and i think it's one of the things that distinguishes us at all times. a call to using my technical degree to make a difference in the world around me he. and at epa, i worked my way up the ranks doing that. and in the time it took me to get from that place, the young staff-level engineer and the extraordinary journey that brings me to stand before you today, i've seen the environmental movement change. i've seen many changes in it. some good, some bad. but one that certainly become more than good is the number of women in the field of environmental protection and conservation. in many places, women outnumber men in their caring for the earth. and their work on issues that are about the legacy and the stewardship of clean air and clean water for children. and for our families and for future generations. i feel personally that i owe a lot to women who go before me.

and that it's always important to take a minute to remember them. whether they're female engineers who went before me. or mothers or grandmothers or women business leaders or educational leaders, all of whom paved a way. one of the things that struck me -- i'm also -- i'm from new orleans. i grew up there in the ninth ward. and my family -- my mom owned a house there until the hurricane. and i've been struck a lot by how often the first voices after a catastrophe or a crisis that start to deal with environmental health issues are those of women. of mothers. or public health practitioners. who are on the front line of worrying about soil contamination or air contamination or water contamination. in new orleans, in some of the poorest neighborhoods, where you would expect the rhetoric would go something like we can't afford to worry about soil contamination, how about we just get you a new place to live, i have been struck by the advocacy of women in those neighborhoods to stand up for clean and

healthy and a safe place for them and their families to live. it takes an amazing amount of strength. and i don't think that strength can be underestimated. that's why i have a particular -- i'm particularly touched when i think about the strength of the women in our amazing cabinet. and the growing number of women leaders in congress. and why i'm hopeful about our future. now, you guys asked me here to talk about change. and i'm happy to do that. i'll talk about change in my little world, which isn't so little, over at high-speed. -- epa. over the course of over 12 months we had one very simple desire and that was to show the american people that there was a real difference in the obama epa from the last eight years. to show them that the election really did matter. and one of the place it matters most is that the only agency, the only agency across federal government entrusted with

protecting human health in the environment -- it's an independent agency. that's epa's entire mission. and its job is to implement some of the most fundamental laws in our country, the clean air act, the clean water act. the superfund cleanup law. the hazardous waste laws. laws that are really foundational to what has made this country a world leader in environmental protection. so, yes, we've had a change in direction. when i arrived on my first day, it's almost a year now, there were 18,000 dedicated employees at epa ready to turn the agency around and get to work. i like to joke with the president and i told the first lady when she came, i'm pretty sure it was 99.9% sure for the president during the election. it's not by accident. still in this day and age and it saddens me the environment has become a polarized issue when it comes to partisan politics. and yet it shouldn't be. but it does make me proud as a democrat to know that we are the

party that then carries the idea, the idealism of an environmental movement that's above broke. -- protection. through the hard work and nonpartisan efforts, 2009 was a busy year. we talked about a return to science. the best science we can muster on behalf of the american people. a return to the law. because we had seen almost a decade of rules and regulations almost commonly thrown out by the courts. and when the courts would throw them out, they would issue scathing opinions that quoted fairytales and alice in wonderland in our clean air regulations. there were moments when we all looked at it and thought, you know, it's kind of funny. but when you think about what that means on the streets, when you think about what it means in my hometown, with children who are battling asthma and seniors who are already trying to go outside or trying to enjoy quality of life and realize that every one of those court

decisions as it was overturned were years, almost a decade of inaction, nonimprovement on clean air. and sadly, a creeping belief that that inaction was somehow necessary so that we could have economic growth and vitallity. so what have we done? we spent a lot of money under the american recovery and reinvestment act. almost $7 billion. most of it is on the street and under contract. i'm happy to say. most of it, $6 billion of that $7 billion go into water and wastewater projects across the country, through the states. we're approaching 70%, i think, under contract. and we have a statutory deadline of february 17th to get 100% of that money under contract. so that means work will start. jobs will be saved because congress saw fit to entrust epa in the states with investing in our water infrastructure as part

of our economic recovery. it's a great message for us. it's a great message for president obama. because as he says all the time, there isn't a need to choose between jobs and the environment. and, in fact, in the recovery act we see the perfect marriage of both. how you can invest in clean water is an investment not only for human health but for economic recovery. because you cannot have economic growth without adequate and reliable supply of clean water. we put forward new principles to address chemical safety. the recognition that chemicals are present in our environment and in our bodies with increasing numbers and with increasingly long names was a call to action. and i believe epa this past year answered that call to action with a set of principles for the obama administration to use as we work with congress to hopefully revise the 30-year-old law that governs chemical management in this country.

we were happy to support president obama by proposing a clean car program. those rules for clean cars are not only for fuel-efficiency. they are the nation's first proposed rules to cover greenhouse gases from any source. and they came after years and years of almost unabated warfare between states and the auto industry and the federal government over what cars should be built in this country. and president obama did something that in all my years as an environmental regulator i never thought i'd see. he made us all sit down at a table and come down to -- come out with one roadmap that made the state of california happy and my own stomping grounds new jersey happy. it made the unions happy. it made the business community happy. those rules are due to be finalized this spring. they accelerate fuel-efficiency and, therefore, reduce greenhouse gases in this country

in our automotive sector by 2016. and we're already starting to talk about 2017 and beyond. we put in place quietly world-leading nationwide greenhouse gas reporting structure. we proposed that rule and finalized it last year. and set the stage to reduce emissions not just in cars but at stationary sources as well. and in a long, long, long overdue action, we announced an endangerment finding on greenhouse gases. we sent it to the white house. this time around the obama white house opened the email and finally 2009 marked -- last time they didn't. 2009, therefore, marked the year, officially, when the united states government began recognizing and taking action on the threat of climate change. those are just a few of our accomplishments. and they're all in one area. i can talk about any number of

them. but i want to leave time for question and answers. but i also want to talk about a change in direction. because as much as any one action might impact an agency or the american people and how it's perceived, it's really about a direction that i think i want as you heard in the introduction us to be about at epa. it's what makes epa valuable to the american people. and it's what we plan to continue. just give me a couple minutes and i'll at least outline the big seven priorities for epa's future. i just put a memo out this week. each one of these is equally important. and in no particular order. which i have to say to my staff because they were all eager to see what we were going to do. the first, of course, is taking action on climate change. and putting the president's clean energy transition agenda first and foremost in our minds. we have to continue the work we

did, all that work i just enumerated in 2009. we have to continue it. and i believe we can continue to reduce greenhouse gases, assure compliance with existing law. and help transition our economy to a more sustainable way of doing business. i think we can do that while working with the senate and then with congress to get a new comprehensive piece of clean energy legislation wait a minute. -- at the same time. we have a right to complete our energy star programs. it started at epa. epa officials who weren't able to regulate greenhouse gases realized the american people would do a lot just to save money. and energy star appliances and energy star home products and home retrofits with energy star -- that whole brand has saved the american people millions and millions of dollars. and has saved us millions and millions of pounds of unused

energy and, therefore, millions and millions of megawatts of unused energy. and, of course, that means greenhouse gases as well. next, is improving air quality, pollution in the air we breathe remains a critical, environmental and public health concern. last week epa announced stronger proposed standards for ozone.rs ozone is the main ingredient in smog and that single measure alone over the course of probably many, many years -- because that's the way the clean air works, will save lives. will save hospital admissions and will save doctor visits. will make it easier for americans to breathe. we want to build on that. we want to set up and fund a strong -- a stronger monitoring permitting enforcement system. we need to turn our attention to air toxics. those contaminants that aren't really regulated to the extent of the big pollutants are. but that have a tendency to build up in neighborhoods.

probably the one you've heard most about is mercury which is -- can be a hot spot of air pollution contamination and ends up in our water. and last year studies came out almost every single fish that was tested had mercury in it. some above safe levels. some below. but it is there. it is becoming ubiquitous. so we need a cleaner air bill of health. number three was ensuring the air of chemicals. every few weeks americans hear a different story about a new chemical with such a long name that we abbreviate it. a chemical that can affect brain development and has been linked to obesity and cancer. it can be found in baby bottles. and another which is said to affect reproductive development. whether it's lead or cadmium is the money that's on tv in toys and products. we see a list that seems endless. and a problem that seems insurmountable. i believe epa working with congress has an opportunity to

make significant long-term progress in chemicals management in this country. last year i announced principles for how we could reform our toxic substance control act and this year is the year to accelerate our work to see legislation to actually do that. another priority is cleaning up our communities. using all the tools at our disposable including enforcement and compliance. we have to continue to make a dent in the superfund site backlog. but we must also understand the importance of addressing brown fields. the smaller sites that have been in communities forever. that are just with a little nudge can probably move towards cleanup and more importantly be locations for economic investment and growth. and we need to protect america's waters. i can't believe i'm standing here in the year 2010 saying we need clean water. but that's precisely what i'm saying. because although we have made under the clean water act tremendous progress on point

sources, on the contamination that comes out of pipes, we have to address nonpoint source contamination. what happens when it rains? when rainwater flows over our lawns and over our streets, over our parking lots? over our agricultural operations and over in our animal feeding operations and into the drain and into our surface water. sometimes it contaminates our water. and probably nowhere where it's available in the chesapeake bay and there's an executive order to hold us accountable to short term milestone to really improve the chesapeake bay. next, we'll focus on expanding our conversations on environmentalism and on environmental justice. i just left our department's martin luther king day ceremony. and it's always interesting to hear how all the issues that he fought for come down to simply ensuring a level playing field in this country for americans.

environmental pollution is much the same way. no one sets out, i think, to pollute any one group. but because people are poor. because they can't afford to move away, that doesn't mean they should be subject to a lesser standard of environmental protection. because they can't afford to move away. there's two pieces to that. first is the conversation. we need to make sure those voices are at the table. and that they understand that, yes, indeed, even in the midst of an economic downturn. even in the midst of what we're doing, we also need to make sure that as we grow, we protect your health. yes, indeed, we must. but we also must be willing to listen. to understand that priorities in communities can sometimes be priorities that are different from those that we look at across where we sort of look across the u.s. and both, i think, are going to be crucial to epa. and last but not least, we're going to work hard on building stronger, better partnerships with our state governments and

our tribal governments. ...

. >> and it means looking ahead to 2050. when we're 80 years old. and saying to ourselves what should we be? how can we make sure we're in front of the threat to our grandchildren and children in 2050. and i look forward to working with all of you on that and delivering our change. thanks so very much. [inaudible conversations]

>> i wish one of those two questions was harder. honestly. i don't think i need to explain it any more to say it's surface mining that happens literally very close to or almost on the peak of a mountain. and almost exclusively -- and exclusively in this country, it's not too high or appalachian mountains. we see it primarily in west virginia and in kentucky. and one of the things that environmental advocates have been saying for some long time now is the practice should end. i think that i'm actually quite proud of the work he has done on mountain top mining so far. our work is not done. because we have tried to bring science back into the discussion. what really happened is that we had years and years of a wink and a nod giving to top mining permits. if you apply for one over

periods of time, you would get the permit. and comments on the water concerned associated with the practice. and put in the following permits issued. the first thing we did was make it clear that the we were going to review the comment and if necessary exercise our right to veto any permit that we believe really threatened water quality in the way that was unacceptable to be protective. we have not yet vetoed a permit. we have a lot of attentions from permit that we e have okayed. the most recent one is mine. but little attention for the ones that haven't been issued. they are undergoing rigorous review. the question about coal, coal like other forms of energy use and production in the country must transition to a different tomorrow. what is so painful is realizing that a lot of the real animosity towards the position that we

hear is just people being afraid. they are afraid of the economics of the time when people are literally trying to figure out how to make ends meet. i do believe the epa has cleaned their act, literally driven the frontier of technology, acid rain battles. and we're probably drive mercury as well. if we were called to be truly cleaned, that means we should be in coal mining and the disposal of the waste that comes out of the process. and of course lastly, we need technology. which isn't there right now to sequester carbon if it's written on the clean from the stand point of climate. >> it is expected under the clean air act for the co2, there

is political action such as contacting certain senators which would help maintain the strongest clean air act as possible? >> the only thing i'm allowed to do by law is invite you to become educated on issues. but i cannot lobby. and in this case, there's nothing i could lobby you if i were going to. there's nothing that we know next to the 20th, there's a possibility that there will be a vote on the amendment to the clean air act. we have not seen the amendment. senator murkowski of alaska has been talking about whether or not she'll do one. i will simply say this, having that i have not seen it, i have respect for the senator that she is in the past been really a voice trying to move forward the issue of climate change. but i will say as well that i'm quite proud of the actions that epa has taken on co2 under the

clean air act. and i believe that there are more common sense actions that can be taken under the clean air act that will not harm our economy and that will actually help move us along in the transition to clean energy. which americans want. americans want to transition to clean energy -- cleaner energy. and they also want to transition to more homegrown energy. because we are all worried about the national security. and the president has said over and overagain that jobs in the future are going to come around clean energy technology. so we need to move in that direction. i think epa can move forward and hopefully we'll see congressman in florida at the same time. >> are there any circumstances in which beneficial reuse of core consumption rates is justified. can you share your thinking on the issue and offer details about spending the weight issue? >> yes. yes, to the first question.

are there examples where they can be reused? absolutely. that's my technical opinion. we are in the middle of working on rulemaking. the rulemaking will come out. you're all have the the opportunity to comment on any proposed rule. i have to be a little careful, expect to say that there seems to be general agreement that the use of concrete and concrete like products in the environment. it's from the fact that coal ash is really coal that's been bury ied. if you put that ash in the ground in large qualities, you're going to see it increase andlings like arsenic in your water. i think there's general agreement on that. that's not a problem from the concrete perspective. there have been a lot of

halabalu over it. we are going to try to craft rulemaking. i think we agree it can be reused. in fact, we would love to try to reuse coal ash. >> from the nuclear power, it may drowned out smaller companies working on the wind power. can limits on money going to nuclear power? >> anything is possible. you know, i think right now when nuclear companies would argue that there are limits. because nuclear is such an expensive proposition, they needs lots and lots of money to -- lots of and lots of loan guarantees and money in the form of loan guarantees. that's certainly one of the issues that i think the robust debate on comprehensive clean energy legislation would help the country deal with. why do you want legislation, can't you do it on the clean air

act? >> there's some big policies and decision that is we would like to see, people, representatives, and congress speak to. the role of domestic sources of energy. and, of course, how to move to a price on carbon. the cap-and-trade question. to move us from where we are now, where it is free to put as much carbon into the air as you like to a place that the industry says, it's cost money. we're going to find ways to latch it down. that's what with we'd like to see. >> can you comment on the difficulties involved in being transparent about science when the public and the media are not science literal? that's question number one. number two, why are so many epa political appointees not scientist despite on the every says -- emphasis on the return

to science. >> we have quite a few political scientist. city planner. we have chemical engineer and a lawyer by training, he runs our program. but somebody else. of course paul, the head of our office and research and development who's widely considered the father of green chemistry. it's a scientist. we have al, who's the engineer. he's the head of our dallas office. so we have a nice mix. but we do still -- for those of you who are attorneys, we have the legacy of attorneys in all of our agencies. thanks goodness. we along with the return to science have talked about the return to law. that's extremely, extremely important. it is difficult. i won't say to the public. i mean even to myself. the issues that we are dealing with are very complex. the more we learn, the more we know about the relationship between water and air. the things you do in one can

make pollution in the other. i think there's also a weariness on the part of the public because they hear scientific experts from all sides saying sometimes completely opposite things. i think that key to transparency are two things. you need to know who's paying for the research. because organizations both be there whatever on the political spectrum put out some study. scientific or otherwise that proported to speak. but in my world, it's about science. on the toxicity of any chemical. i think you would to know who said for that. i think that's extremely important. often times by the organization, when it's epa, you know. and we are rigorous in our conflict of interest screening that we use. i think we continue to be and very proud of it. it maybe a problem here or there, but i'm not aware of any major problems on conflict of

interest. the second major tool we have is peer review. i'm never afraid of peer review. expect when people will peer review just to delay. at some point it becomes our job as managers and policymakers to round up all we have and decide when the delay is more health impact or protecting each other. that's what we are working on. >> can you give some example on how epa is putting science back into the environment? >> i can. i can. you know, those decisions last week was a tough one. in fact, still what happened on the decision was that under the clean our act, there's a boulder that's supposed to render decisions every five years on what levels of any pollutants are safe. it's a safe level of ozone. that we will not have adverse impact with a reasonable margin of safety. those are the words in the law. and the board, years ago, during

the bush administration recommended a range between 16 and 70. after that, the president himself proposed 75. it was such a hard moment. we know at one time, we were saying to the country that we don't enjoy saying. which is, hey, you know, the numbers we've told you in the past, 84, 75 aren't good enough. we're going to have to get to even lower numbers. so the proposal now is between 60 and 70. my belief is we can't tell people that if we can't say listen as a country this is something we can solve quickly. here's what we have to try to get to. and it's the best science we have. we can't have a conversation. some day we'll have a mayor onus saying our air is at 75. billions of people are still

getting asthma. what's going on? we have to be honest. that's scientific integrity to me. it's out for public comment. i urge you to take a look at the proposal if it's of interest. and then we have to move into how do you get down to something like a 60 or a 70. then we have to look at cost. if you don't look at cost when it comes to the science, the law forbids it. when it comes to how to get there, of course you have to look at cost. if it's in a risk information system which we've revamped how it comes out to the ozone standards. i think we have moved toward transparency in terms of moving information out for public comment. i think that's very important to. >> we have only time for one question. i'm going to do one on top of the other. >> okay. that's good. [laughter] >> politics there. >> do you have any hope that environmental issues can be a

rally point for bipartisanship in congress despite recent history? and the next question is where do we stand in america today in terms of where the world stands on issues related to the environment? >> bipartisanship around the environment. absolutely. all history shows there should be tremendous bipartisanship on the environmental protection. this is not the environment versus jobs or the environment versus economic roads or the environment versus one city or -- but we have seen a couple of places where i'm sad to say we see some indications that it's not going to be that easy of a road. which is a pretty political environment that we are all working in. and it's my hope that over the long term that can change. there are moving towards justice. i think the heart also moves every one of us is a member of a family. >> we're going to leave the

remainder of the program to take you live to the white house with the briefing with robert gibbs. >> we repeated today, he said, i think the white house did everything we were asked to do. if ask earlier, we would have responded earlier. and then something you said. >> well, i think i was asked friday why we were coming on tuesday but not friday. i ask we'd been asked. >> i understand opinion the indication here the white house with an election this important did the majority to your agenda and health care can't assert itself or won't assert itself into this issue and try to make a difference. can you talk about that a little bit? >> well, look.

obviously president went on sunday to lend his support to martha coakley. he talked about why he believed he should be the best senator. somebody who has fought for mid-class, working-class folks in massachusetts. you know, we're going to have penalty of time to get into the back and forth of all of this. i'd prefer to do that when we know as a result. >> that's why you're saying you don't want to assert yourself with something important unless you're asked to do which is weird. or that you're setting yourself up for this election to be lost by democrats. >> well, again we'll have a chance to discuss the outcome of the election when we know the outcome of the election. which is many people know is ongoing. right. >> quickly, on another topic, tomorrow there are i believe six

hearings having to do with the christmas airline attack, yemen, al qaeda, fort hood, can you talk about that. how is the white house getting ready? how do you want that play out tomorrow? >> look. i don't know much about preparation. other than obviously you've seen john's report on both topics. obviously these hearings were announced after the incident but before these reports. i think the administration obviously is more than happy to discuss what's in these reports. but more importantly, the steps that we are taking to address the concerns that these documents bring up. that's been the president's charge to the team this entire time. i think you've seen the president be quite open in the discussioning our failings.

the other that now all of us -- both capitol hill and the white house to ensure that we do all that we can to plug those short comings. yes? >> so we know now of the cutting loss in massachusetts. what planning is the doing to keep the health care bill alive as well as to -- >> obviously the -- we can get into discussing the results of tomorrow tomorrow when we have results. >> whatever the outcome of the election up there in measured, what's the thinking of the administration that this is exposed public skepticism, perhaps a backlash not just health care -- >> again, i don't. i think to get into why something happened before it happened, we will schedule a briefing not unlike this for approximately the same time

tomorrow. and we can discuss a lot of this. jay? >> for getting the results of the election -- it's incredibly close; right? you guys have said -- >> it's a heavily contested election. >> heavily-contested election. okay. is the president say that it's any reflection on him or his agenda or his governing style? >> look. again, as i said, we'll have a chance to get into -- >> no that's -- >> no. let me finish. i think there is -- obviously this isn't something that's known in one election in one state. i think there's a tremendous amount of upset and anger in this country about where we are economically, that's not a

surprise to us. because in many ways, we're here because of that upset and anger. that upset and anger, it indicates much farther back that the than the 2008 election. that's not to talk about any previous administration expect for quite some time the middle-class has thought that washington was looking out for washington and the big special interest and not looking out for them. i don't think there's any doubt to that. i think the president who reads letters from people every day could be in hawaii doing a town hall later this week. i have in doubts that people are going to express anger about where we are. we have seen the economic downturn and collapse that we haven't seen since the late 1920s and early 1930s.

it is -- i think that is going to be the source of -- rightfully so. a lot of frustration. understanding that there were a lot of people that were hurting well before the calamity hit wall street. waging weren't going up. you guys heard the president talk about this. people working longer. people were working harder. people were very productive even as the wages couldn't grow. there's a lot of economic frustration. >> if you look at the right track, wrong track number, which i know you pay attention to, it was improvement after the president obama took office. and then it became the majority of americans at one point thought that we were on the right track. that number has started to go down. even as the economy has continued to tank. a lot of americans are now attaching their frustration with washington and what he's doing. >> i think there is certainly

some attackment to us. i think there's some larger attachment to this town. i think there's a attachment to the pace of that we cover re. that you would count the president among those frustrated. the president is understand understand -- understands that there is frustration out there and he's frustrated himself. >> when you look at the whole -- what the american people think about his family and health care reform and the health care reform bill himself, they don't approve? >> right. >> is it possible that it's not just -- along with president obama they are frustrated with the economic recovery, but maybe that americans disagree with what president obama is doing. disagree with the direction he's taking the country. >> look, we have had a vigorous back and forth about health care in this country. we'd be the first to admit that we -- we think there are a lot more benefits than people see

and feel in these bills. if that's a failing, i think that is -- it's certainly a failing that i and others here at white house take responsibility for up to and including the president. yes, ma'am? >> if the senate loses the 60-member filibuster, does the president feel it would be in the best interest of moving health care forward for house democrats on the -- >> let me just. these are going to be all great questions tomorrow. but i just -- i promise i'll be here tomorrow. how about that? >> can we turn to haiti then? >> sure. >> our flag is flying over lathe -- over haiti passing the message that they should not try

to come to the united states. they would be turned away. >> i don't know the message that you are talking about. we have no preparation for any time of mass migration that some might have been concerned about. we don't see any evidence of that at this point. >> you don't have any message? >> i can certainly check on that. i know there's a 2:00 call updating calls that we've done on giving you all information from our disaster response teams about the latest on the ground. and our focus obviously is on search and rescue right now. >> governor said that the white house is informal getting the plane out of the orphanages and just clear -- >> they are working on that

now. i don't have that up-to-date information. >> do you know that half of the orphans were sent -- there was a number of 53 -- >> we will get a fuller readout on that. we've been putting it together. some of the folks that were involved are on their way back from haiti to washington today. >> there is a 4:00 meeting at the white house? >> with? >> us president. >> there's a principals meeting. not a presidential meeting. there maybe some updates that we will brief you on as well. sometimes the president has been in sometimes, he hasn't. coordinating our response and ensuring that if people feel like we need -- if they need more help in doing stuff that reaches the highest levs so we can make sure that happens.

>> what's his agenda? >> i think the top priority, helen, is to continue to work hard on the economy back on track and create jobs. that is he outlined some ideas in september on some successful programs, some are which are in the recovery act that many people have -- the pilots have oversubscribed in terms of the amount of money that was available. it is primary focus will be on creating jobs. >> i'd like to talk about a different topic. the election in massachusetts. [laughter] >> you don't want to discuss why something happens before p happens. something has happened.

there is a ground support for a republican for a candidate who's running against the president's agenda? >> well -- >> go ahead. >> go ahead. i don't know if that was the question. >> there's so many questions. is this a sign that the white house is simply lost touch with the american people? i just don't get it? >> yeah, the poll didn't come to that conclusion. whenever the construction poll, they said 70% of the american people thought the president cared about people like them, i came to the conclusion that 70% of the people believed that he cared about people like them. so i don't -- >> i mean this is massachusetts. >> i should try that. use your poll on him and sort of -- >> it does sound like you are confident that the republican are going to lose. that's the point where the

american people are going to use. >> your question is whether the vote would be reflected. i said your what your poll showed. chip, again we'll have time -- >> i think he's just lost touch with the american people. >> i think according to any reasonable measure the answer to that is of course not. >> have you heard him express some surprise or frustration about how close the race is? >> yes. >> could you give us -- >> he was definitely surprised. >> anything else, angry? >> he's not pleased. >> frustrated about -- >> we'll get into more of that tomorrow. >> i recognize you don't know the results yet. and in the preparedness which i'm sure the president used the virtue. we're talking to speaker pelosi at all about the house happening. >> i don't think the president has had an opportunity. i don't think the president has spoken directly. >> and i assume that some people

here have talked to the speaker. i don't -- i do not have a catalog with each and every one of the conversation. >> why didn't the president lay out the steak when he was in massachusetts on sunday and say to those folks if you don't put martha coakley in the united states senate, our health care bill likely dies. >> again, let's wait for the results. i don't think the president believes that. >> so we doesn't look how they are hanging on by a string here. >> health care is a priority for him now. it'll be a priority for him tomorrow. >> is there any reason -- >> i think the president laid out exactly what was at steak for. for the people of massachusetts, it's about electing somebody with their interest. are you going to elect somebody who has consistently fought for middle-class interest as you

heard the president say a or somebody who campaigned as independent 96% of the time with republicans in the state senate. i think he laid it out quite clear. >> it's his decision not to put it in those terms. if you don't put coakley in the senate, our health care bill could fail. that's not a very common argument. >> again, i don't think that the president believes and subscribes to that as an overall premise. >> i'm talks about the focus on the economy -- >> there's a race near connecticut. >> i wasn't going to mention it this at all in the question. >> right. >> my question is -- [laughter] >> go ahead. >> but feel free to answer your own question if you -- [laughter] >> mississippi is lovely this time of year. >> what -- can you give us some concrete specific examples of

what you'll be doing in the coming months to persuade american people that you are focused on the economy and on jobs. we were talking in general terms. >> look, i can give awe list of what we're going to do. we'll have economic events here later this week. on thursday here we'll visit hawaii on friday. we'll talk to the u.s. conference on mayors about job's training agenda on thursday. but the president is going to get focused on the economy in the coming months. the president obviously has been focused clearly on the economy since his first moments in office. last week the president discussed a bank responsibility fee that focuses on the health of the economy. the president will talk about the agenda for creating jobs. by getting ourself back on a path towards fiscal responsibility.

making college education more affordable and taking the banks out of being the middleman for college loans. a lot of those things the president has talked about and will continue to talk about. and you'll see obviously some of that in the state of the union. mark? >> well, since you've answered all of our questions on the special election. can i ask you if the president is going to take notice any way tomorrow? >> nothing special, no. >> does he aware that it's his first year in office? >> well, i don't want to be technical about it. but wouldn't today be the end of his first year? >> tomorrow would be the end technically. >> i don't know if there's anything that he'll do prior to noon that -- i mean i got to be honest with you mark. i think in many ways it is -- it's, you know, it's an anniversary of types.

but i don't. i don't see that a lot of people are ultimately focused on marking the first year. i mean you have to remember that we've had the anniversary of the election, that was the first year. and then there was the end of the first year. and then there'll be the end of the first year at or around noon or -- so, you know. there's first 100 days, first 200 days. first 6 months. we can. [laughter] >> no, but they'll be no surprise parties for the end of the first year. >> the president called bipartisan commission on the state of the union? >> he has in talking about laura's question about the economy. the president obviously has put

-- head has talked a lot about the need to get our fiscal house in order. he shares the concern about where our fiscal situation is. and he's exploring many options for both the budget and in the state of the union that we would be talk about our commitment to doing so. >> why didn't the president say it would be harder in october and november? >> the president continues to work hard on that. >> robert, i understand you are still gathering information on governor randal and the adoptions. >> let me get more information before i -- look. obviously it is -- i think we have all seen remarkable steps

coming out of such a calamitous disaster. you know, our search and rescue teams finding more and more people every day. the record number of people for an earthquake just yesterday. but i think as you're heard administration officials on the ground in haiti say. we will do better today than we did yesterday. we'll do better tomorrow that we're going to do today. we're trying as hard as we can in working with the haiti government in the terms of the largest humanitarian effort we've seen. what we will do will be bettered by what we do tomorrow. >> totally new topic. any update on where the president is going to donate his noble prize money? >> they continue to talk about it. i think he's not received any money yet.

but it's -- he makes those donations, and when we does we'll let you know. >> we talked earlier during the campaign that you guys were able to tap into the anger in the country as actually the outsider. >> well, and i also said that obviously we -- that anger was there. we certainly acknowledged it. >> i guess the question is do you guys feel that what has know happened to the president and the white house is that you guys are now the recipients of that anger in a way that you maybe didn't expect? >> no, no, no. to go back to mark's question, we haven't been here for a year wondering what it is we were here to do. you know? obviously the president was elected to deal with a set of problems. to make the right decision whether or not it was the popular decision. and, you know, look this was the

case long before the poll that jake or the poll that i mentioned to chip. some of those decisions weren't popular ones. well, before we got to what you were talking about jake, ensuring that the banks didn't collapse. it's not a popular decision. the president strongly believes it was the right one. ensuring that two domestic auto companies didn't go out of business. not popular. the president believed it was the right decision to make. he understands again -- we understands that frustration. he's heard it. in all honesty, he heard in when he ran for the united states senate in 2003. so, you know, i don't -- i don't believe that -- certainly it's frustration. i think it is with a lot of

people in this class. >> robert, you said moments ago you'd be the first to admit that there are more benefits than the americans see. the sail into the communities that you and others on the white house including the president take responsibility for it. why do you think given the many words that have been spoken, the many adherences that the president has made around the country -- why do you think he's unable -- no i'm not. >> i know. >> why has he been unable to convince the american people that this bill is a good idea and the right thing to do? >> look, i think in many ways -- some of this is dragged out. there's no doubt as many words as the president and as many interviews as he's done and as many appearances that he's had, there's no doubt in some ways it's drowned out by arguments that may or may not be central

to the focus on the bill. but whether we have -- whether health care today was passed or not. the president would be talking about the benefits of that bill even if it was passed. many of those benefits that he would talk about going into effect immediately. ensuring that a child that has been discriminated against in trying to get health care doesn't get wiped away as soon as the president signs health care. >> you talk about it, is there anything that you would do differently looking back. is there something you could have done better to make your case better for the american people? so that we -- you wouldn't be in the situation that you're in right now? >> look. if we -- i'm sure -- i'll read this transcript thing -- i think -- there's no doubt about that

we couldn't have done better. i'm not going to spend lot of time, at least now, going through all of that. at least suffice to say, nobody believes anybody has pitched a perfect game. >> the president spoke by phone i gather on friday. can you tell us what they talked about? >> let me -- i don't have a readout on whether they talked or not. and i can certainly look at it. >> okay. is that also the subject of chris dodd coming this afternoon? >> i believe if i'm not mistaken my guess is i'm sure they will touch on health care as well as financial reform. >> can you give us an overall statement on what we were talking about last week. negotiations to try to bring the two together? >> i know the staff met and discussed a lot of this going through the weekend. i don't have any meetings at this point to announce that the president is in. but i know they continue to work

through the staff level based on hours and hours of meetings. emerging the two bills together. >> does president obama take this special election personally? >> how so? >> you said it's not referendum on him. but should he feel or does he feel he bears some responsibility for the -- >> again. let's see whatñn the outcome i. >> i assumed that -- well, the president will call the winner. we'll have a readout of that call. i don't -- i think the poll is close. i don't anticipate the president will have a statement tonight. yes, sir? >> the financial reform. is the president going to do the first thing as far as the consumer protection agency or coming around thinking that could be the responsibility along that?

>> no, the president's viewpoint on this is i think is quite clear. that we have to have a strong independent voice on behalf of consumers. that's the president has talked about repeatedly in the process. and something he'll emphasize again. >> i believe that will -- my sense is financial reform written large will come up. i get a sense after the meeting whether the consumer part or not. yes? >> i have trouble projecting tonight. leading bank economist last week predicted the private sector hiring will increase during the first three months of this year. they suggest that the politicians refrain from spending more tax dollars on job creation until the end of the three-month period. if our projection is wrong, then

we should spend federal dollars. i'm just wondering if the president this week when we talk about the economy has that kind of patience. that's wait and see. >> well, the president outlined a series of ideas which i mentioned earlier. an increase in funding for clean energy jobs. there's obviously been discussions about infrastructure aid. there's been discussions about state and local fiscal relief. the president beliefs that the out -- the ideas he outlined in december are no less needed now than they they -- than at any point. and he'll continue to push forward. do i hope the private forecaster are correct? i think there's certainly millions of americans that hope that's true. the question obviously we will eventually get to is the pacing of that.

and are there things that can be done to explain that process? that will be -- that's what president has asked his team and that's what the president will demand of all of us, including congress involved. >> you don't have an answer. if the economist say if you spend more money, it's over kill. >> again, i mean -- the whole -- the important hole is about half a million since the recession began in 2007. i don't think that anybody -- again that's just -- 7.5 million have lost their jobs. there's obviously people that are not in the statistics, because they continue to look but they've been looking for more than six months. i don't think we're in danger in the three-month period in filling that hole completely. the president believe that is we've got to do that and begin

to add jobs based on a new foundation that doesn't depend on bubble of bust economy that we've relied on for a long, long time. yes, ma'am? >> robert, proudly speaking, can you talk about the difference between 59 and 60 votes here broadly? >> broadly, it's one. >> i know. >> we'll talk more tomorrow. >> yeah. including code paint, green piece or plenty rally for the white house to protest what they say have been a failure to accurate deliver on a lot of the change that was promised a year ago. what's the white house message that's questioning or the lack or at least the pace of the action on a lot of those priorities? >> well, you know, look i -- there isn't directed at -- this is directed as a response to those interest groups or what have you. i guess doing back to mark's

question, the president -- i missed the reason that there's not a lot of recognition about one year. it's certainly -- it's a callen dare dates that denotes you've been here a year. you know, the president didn't outline throughout the campaign here's what i'm going to do the first year, here's how i'm going to fill two and three and year four will be this volume. change takes a time. change isn't ever easy. well, i think he learned -- helen, part of what i'm talking about. which is that the changes is never easy. that change takes time. the change has to go through congress. and that's not to say -- i think

what congress has accomplished this year has been enormous. getting a recovery plan through as quickly as was done to get resources into the economy that we've already seen as helped pull an economy from negative economic growth from four consecutive quarters to the positive. i think there's an awful lot to be proud of in what has been accomplished. i think can aa sure that you that the president never thought we'd wake up in january 2010 and well, i've finished it all. now what am i doing to do? we always knew we'd have plenty to do. >> is it fair to expect that the state of the union address will depend on what happens in massachusetts? >> i don't think that's true, no. i think we've been working on a series of ideas and proposals.

helen asked what the most important issue was on jobs. the president will -- regardless of what happens, the president is going to talk about jobs. he's going to talk about fiscal responsibility. he'll talk about the obligations in iraq and afghanistan. he will address tourism. i honestly don't think that -- they are writing the speech right now. if they are going to change it all tomorrow, i think it just goes a little early to the gym today. >> is there difference between the body language? >> i think the president understands that regardless of what happens, we face a set of circumstances that have to be addressened and dealt with. whether there are 59 seats in the senate or 60, we still have to work hard to get our economy back on track. we still have to work hard to

make the promise of affordable, accessible health care for millions of americans a reality. i don't believe that there's an entirely new agenda behind some door based on the result of tonight. >> senator voinovich says that he thinks the president obama agrees on him on bipartisan but isn't sure the politics are there. does that sound right? >> look. i know in the coming day thes senate is going to vote on what senators conrad and gregg have proposed. that's certainly one thing among others that we have looked at to get our country back on the path towards fiscal responsibility. >> what about the draft right along for the speech? >> john, if you can hear this,

please call. i don't know. >> this is not like the first or second draft. it's been ongoing? >> he's been writing for a while. >> also. on the speech, when it comes to haiti, will the president deal with the issue of haiti in the speech and giving and compassion of the american part? is that part of the speech next week? >> he will undoubtly mention haiti. i think what we are all enormously proud of as americans is the outscoring of support for suffering that people have seen on their televisions. one the things -- that's one the reasons he wanted to visit the red cross yesterday. i think we have -- the spirit of the american people always meets

the challenges that is faces. i think american we could all be proud of -- of that spirit. >> is there a concern about some of the organizations that have been raises funds on the relief effort. is there concern about some of the controversy on the organization? >> well, look, i don't know enough about individual -- all of the individual charities. obviously there's a set of criteria that people can look at before they give their money or how much is spent on overhead, how much goes to, you know, to what is needed on the ground. obviously, former president bush and former president clinton have helped the setup an organization to deal with both

the search and rescue and what is needed to get heat and water and resources there now. but they will also be there in the months and years to come in what will clearly be a very long-term project of renew renewal and rebuilding. >> two things. you said the president was angry, with whom? >> i didn't. >> can you now? you might tomorrow? >> there's always hope. >> the other thing is i want to emphasize -- [laughter] >> the transfers to. >> you have emphasized the president's concern about the unemployment numbers and about the deficit. in dealing with one, do you exacerbate the other? >> look, i think the president understands that, for instance,

the recovery plan was split up into basically covered two fiscal years because nobody believed that we would have turned this completely around given the depth of the recession that we were in immediately or only after a year. so i think the president is understanding of whatever -- what tension may be there. in dealing with the medium and long-term fiscal challenges that we face. but absolutely. if you necessarily pull back completely you're not -- you've got to gas and break going that isn't going to necessary help where the economy is. thanks, guys. >> what about tomorrow? >> meet me around 10.

if we're not here, with start without me. [laughter] [inaudible conversations] >> they are heading to the polls to elect a new senator, the seat that ted kennedy had for years. the candidates that martha coakley, scott brown, and joe

kennedy. we will accept your phone calls and e-mails. live tonight on washington coverage here on c-span two. did you know that one of the top free news apps for the iphone or itouch is c-span radio. you can get quick access to c-span, c-span radio, and c-spaf the links including q and a. it's all available from the app store. >> now a discussion on the role of google in the study of history and hue it's book program, google books is helping higher education and professional research. we'll here from google and the university of california. this discussion from the annual meeting of the american historical association in san diego is two hours.

>> well, hello, everybody. thank you very much for coming. i am shawn martin from the university of pennsylvania. i am the executive director of the american association. we are extremely happy to be cosponsoring the session with the research division of the american historical on is google good for history? which is very engaging and interesting. i hope that a lot of you have questions and thoughts in mind for a discussion. so we have three great speakers that are going to be talking for about 10 to 15 minutes each. maybe a little bit more. and i think what i will do is introduce all of them to you now. they'll talk in that order. and then we'll have time for -- plenty of time i think for questions at the end. so without further adieu, i'll introduce our three speakers. our first is daniel cohen. he is the associate professor in the department of history and

art history in george mason university. his own research is in european and american intellectual history and history of science. and most notably for this group he is coauthor a guide for presenting the past on the web from the university of pennsylvania press. no personal connection there, i can assure you. our second is paul duguid who is aadjunct professor at university of berkly and university of london and visiting fellow at york university in the uk. and for the institute of management. his current research focuses on the history and development of trademarks. and again notably for this group he has written two articles about google and the issues that google raises for history in particular. one inheritance or loss, a brief

survey of google books. and also lines of health organization, pure protection, and the laws of quality. also from first monday. and last, but certainly not least is brandon badger who is product manager for google and has been at google for four years. he studied computer science and ainsures me that he got a b minus all of his history courses. he's well qualified to talk to all of us today. without further adieu, i'll let the speakers go. thank you. >> thanks, shawn. it's great to be here and to talk about this topic. is google good for history? of course it is. we historians are researchers of

evident. :

>> while it seems an excessive book about google comes out every week, where are the points of criticisms about proquest or other large information companies that serve the academic market in more troubling ways? these companies also provide search and information services, charge exorbitant rates for the privilege of access. they reach money out of budgets every year that could be going to other more productive uses. google on the other hand gives us the google books, google scholar, scan newspaper archives and more. often best in commercial offerings and often being completely free. in this bigger picture away from the obsession of the biggest tech company at the mall, and i'm sure some of you can remove the same obsession against microsoft and ibm in prior eras. google has been very good for history and historians.

one can only hope that they continue to exert pressure on those who provide costly alternatives. of course, like many others, who feel a special bond with books and our cultural heritage, i wish that google books was a project not under the control of private entity. for years i've called for public project asset many others, or at least a university consortium skin schoolbooks on a scale that google is attempting. and i must admit i'm envious of the recent announcement in france to spend $1 billion on public scanning. in addition, the center i work at, has a long-standing partnership with the internet archive to put content in a nonprofit environment that will maximize its utility and distribution and make the content truly free in all senses of the word. i would much rather see google books at the universe archives or the library of congress or somewhere else.

but the likelihood of a publicly funded scanning project in hmt party ration is slim. now longtime readers of my blog and other writing know that i've not pull punches when it comes to google. to this day the biggest spike in readership on my blog was one very are in google books scanning project i casually pushed a scan of a human hand covering a page of plato. the post ended up one day, and since then it's been one of the many examples to the detractors of google used to show a lack of quality in a library project. so let's discuss these quality issues for brief moment. since it is one point of obsession in the academy. and it's an obsession i feel as you see a slightly misplaced. google has poor scanned. as the saying goes haste makes waste. but i guess is that scientific survey, a scientific survey, of the overall percentage of pages that are unreadable or missing and surely there are many school fraction of the total.

in regarding errors as john of google books has noted, when you're dealing with one-two pieces of metadata you're sure to get a million or two wrong. and let's also not begin the bibliographical world beyond google is perfectly many of the problem of google books comes from libra partners and others outside of google. more important, google likely has remedies and i assume brandon will talk about this, for many of these inadequacies. google has constantly improving its ocr capability and a date correction, often in clever ways. and recently purchased or acquired the recapture system which some of you may have heard of from carnegie mellon. which uses unwitting humans to transcribe difficult or much worse of all books when they log into sites. and they've recently added a feedback mechanism for users to report foreskins right on the page they are viewing. so i find myself a bit nonplussed by quality complaints about google books that have

engineering solutions. that's what google does. it solves engineering problems extremely well. indeed, we should recognize and not without criticism as i will know momentarily, that at its heart google books is the outcome like summary of the things at google of an engineering challenge and its associates use of mathematical problems. how can you scan tens of of books in a decade? is easy to say they should do a better job and get all the details right, but if you do the calculations, as i assume brandon and his team have done, you will see that getting a nearly perfect library scanning project would take 100 years rather than 10. that might be a perfectly fine trade off, but that's a different argument for a different project. those who are involved with ocr know, getting from 99% accuracy than 99.9% accuracy, which by the way would still have hundreds of thousands of heirs, would probably still take an order of magnitude longer and in order of magnitude of greater

expense. so that's the trade off google has decided to make and as a company interested in search for near 100% accuracy, is unnecessary. considering the possibility of torch perfection from an perfect first version, it must have been an easy decision for the company to make. google books is an incredible useful even with these laws. although i was trained with place of large research library's of google book scale, i am not an institution that is far more typical of higher ed with a mere million volumes and a few rare words. enabling research that can only be done if you got into the right places. i regularly have students find new topics to research and new discoveries through their searches on google books where you can only imagine how historic researchers and other scholars and students feel and even less privileged places. despite its flaws, it's undoubtedly true that google books will have a tremendous impact on historical

scholarship, around the globe for the coming decades that it is a tremendous leveler, a democratized of access to historical resources. google is also good for history and that it challenges age-old assumptions about the way we have done history. before the dawn of massive digitization project and equally important bit indices, would necessarily have to pick and choose from a sea of analog documents. all that searching and shifting we did any particular documents evidence we chose to write on and continue to choose right on, were and are and let's admit it, proud to errors. read it all, we're told in graduate school. but whoever does? we sift through large archives based on intuition, sometimes we invite important evidence out of sheer luck that we have sometimes made mountains out of all those, because, well, we only have time to sift through molehills, not mouser regardless of our technique we always leave something out in this analog

world. this world has rarely been a world of comprehensive historical search. this widespread problem of antidotal history, as i culligan will only get worse as more documents are scanned and online. many works of historical scholarship will be exposed as flimsy and haphazard. the existence of modern search technology should push us to improve historical research. it should tell us our analog necessary partial methods have hidden from us the potential of taking a more comprehensive view, aided by less capricious retrieval mechanisms w publishet mr. restriction on to large swaths of our cultural heritage, through a settlement that you any caddy support. john orwin and dan clancy and brandon badger have done it admiral job explaining much of the internal process at google books and i applaud them for the. it's much better than the engineers and product managers at places like microsoft or ibm.

but still, the project he was removed and aiding in a way that other google projects are not. that is partly because the article it up and thus hamstrung from responding to somend featu. the same house but that will lead a company to digitize entire libraries also led it to go to four with an copyright books living to break it with authors and publishers in the flotsam that we have in front of us today. we should remember that the reason we are in a settlement that is that google didn't have enough to take the higher tougher road, a direct challenge in the courts, the court of public opinion, or congress to the intellectual property regime that governors many books and makes them difficult to bring online, even though their authors and publishers are long gone. while google regularly uses its power to alter markets radically it has been uncharacteristically meek and attacking head on this intellectual property tower and its powerful corporate defenders.

had google taken a stronger stance, historians would likely have been fully behind their efforts. says we, too, face the is that unveils copyright law places on our pedagogical and scholarly use of textural, visual audio and video evidence. i would much would have historians and google work together. while google as a research tool challenges our traditional and outdoor combat system historians very well may have the ability to challenge and make that what google does. historical and humanistic questions are often at the high end of complexity of engineering foxes google faces. similar to and even beyond, for instance, machine translation. google is it just might learn a great deal from our scholarly practice. googles out of rhythms have been optimized over the last decade to search through the hyperlinked documents of the web. but those same algorithms falter when faced with the odd challenges of change over centuries, and the alienist of the past and old books and

documents that historians examine daily. because google books is a product of engineers, with tremendous talent and computer science, but lessons of the history of the book where the book as an object rather than bits, it founders in many respects. google still has no decent sense of how to rank search results in humanities corporeal. metrics and text mining work poorly on the sources as opposed to, say, the highly structured scientific papers google scholars specializes in. studying how professional historians rank and sort primary and secondary sources, mike hill google a lot. which it could use intern to help scholars. so ultimately the interesting question for me is not, is google good for history, it might be, is history good for google? and to both questions, my answer is yes. thank you.

[applause] >> good afternoon. thanks very much to whoever it was, i'm not quite sure who invited me here. i'm very grateful to be invited that i'm also slightly apprehensive. oath for the same reason because i'm not a historian. talking to you about historical question is a little tricky. i'm also not an engineer so i have a feeding eye of the show on the platform here. i do have perhaps a slightly embarrassing confession to make that i teach a course that is called the history of information which in 15 weeks trots through to twitter. that claims that i would put around that are not very strong that i was looking at my evaluations from last semester, and one of them said what did you not like about this course called history of information that and there was a one word answer, history. [laughter] smack i've not done a very good

job and represent you, the other parts of the world i'm afraid. let me if i'm in looking at the broad question, again make pretty much the same step that dan made. the question is, "is google good for history?," to talk mostly about google books, the sort of shift in the way that i think of as going from the famous scribble scribble scribble to get into the scam scam scam mr. google. there are two reasons for doing this. one is i think that was the premise of the panel, because i sounded off on the topic and maybe a third is because i have been up splinted by the historians were doing so. so let me see if i can get back up further. but my answer effect is exactly the same as dancer is google books but for history? absolute that my caution is is a good enough and my answer is no. somewhat similar to dance in the tone of the answer but i think i look at different points of some of which i think you want to dismiss and say not important. so let me try and outline just

three issues around us, or go through the. i want to try say what i think is wrong with this manifest at the moment what i think it went wrong, and therefore will be harder to fix than we might imagine. and then finally to the point why it seems to me at some times surprisingly hard to criticize google. so that is a different take. and then seems to think google is an easy target to criticize a. i tend to think they're on the other side, people tend to think too highly of google and it is worth taking shots at a. and that way i would remember microsoft. i think we must criticize, i think that probably the people that i am most at odds with, and this puts me at odds with the one remaining neutral on the platform, our librarians. i think librarians -- i see a fight on every side. librarians it seems to me to be in general, and of going to make some exceptions, remarkably supplied with regard to google and those of the people who

could've held google say to the fire and i think they fail to do so. in a way, there's a sort of story which i haven't found the punchline for. it's one of those an englishman, an irishman and a scotsman went into a bar, kind of an engineer, my brain and scholar embarked on this project. what's the punchline? i am still trying to see. let me try to say first what i think is wrong. i think, and i will expand this a little later, i really like to think this way and working in silicon valley as a resource and constraint issue. i will amplify that led about what i want to say is we look in some ways as books as these paperbound collections of information. and if we can come along and extract information and leave the paper behind, that will make life a lot easier. and in many ways it does. but i think it overlooks the fact that books are actually, i made a point again, enormously obdurate, complex and annoying things. but they are that way in part

because they embody physically a resolution to a lot of very complex questions about human communications. they may not do it perfectly, and they're often get in the way, but a lot of the difficulties we have in communicating, if not, result in the physicality of the book. so when you take that away, you have to think a lot about what you are losing as well as what you are gaining. now my argument would be the one reason that google is fraught with problems i think google books is because the data is bad that i think it's not such a product i think it is a very large problem. because my feeling is that when you take away those almost invisible resources in the book in the way it was bill, you actually have to provide yet better metadata to help resolve the remaining information that you have. information doesn't speak for itself in its own validity.

if you write a check to somebody, and they look quizzically at it as if to say, should i trust it or not, it doesn't actually have to lean forward and right good for payment on the front of the check. that isn't going to get someone to rush off and say okay that makes it okay. it's a little more information. so my general theory is you have in some ways to think a lot about the ways in which you triangulate data into which it has been triangulate in the past that and i think that google in many ways has made a hash of that because they didn't understand the problem. let me say again you have to say always have to say this, i use google and google books extensively. i just finished a piece on the contribution of the union label innovation and trademarks in the united states. google books was fantastic and many, many ways for lots of ways that i was -- things i would not have known existed, things i could not have said that i rely on it enormously, but i was also

at the same time using something like the rejects stay, infuriating though as it is, i was using 18 century books online, english books online. but the difference is quite extraordinary that and the point is not to say simply i agree with dan on the santana, wouldn't it be wonderful if they had managed to scan to the extent to the extent google does. on the other side wouldn't be wonderful if google had managed in some way to arrange some kind of metadata in the way that they have. that's what i would like you to to come together. the question of metadata i'm going to pass over fairly quickly, but point you all to a paper that my colleague wrote for the chronicle of higher education, jeffrey denver, about googles and metadata train wreck. that he just pulled a series after series after series of things that google had got wrong. what's interesting and i will mention this again later, he got vilified for the.

not so much by historians. very much by liberator to people who thank him for it were actually the people then has mentioned, both dan clancy and john at google. thank jeff for pointing to the fact that they had these millions of metadata enters in their database. so they took it seriously. one of the things they got wrong, that is of misidentification by title. i will refer to the olympic matches of ms. identification. masses of misidentification by classification of thomas brown's, and masses and masses of misidentification by date. so that i was delighted to find that i had written a book published in 1879. [laughter] >> you may wonder how i remain looking so young but that last part is critical for historians. what do historians have going for them if it isn't dates? and if you mess up dates, you guys, you have got a lot left.

so is it surprising that they went down this road? well no, i don't think so. i don't know -- saying we're going to scan books and i said which ones are you going to scan? he said we will just get everyone of them. that will resolve all the problems of selection. s. probably not a very good way to begin. and i think that google themselves talking to people at google and i've not met brandy before, my sense is they will never say it publicly that they took on a lot more than they realize that they were taking on. another thing that i discovered them i had is both denied and confirmed by google, but i talked to the first six libraries working with google. when google came to them they asked for the books and they were offered metadata. google said we don't need metadata. that's libraries to. we can do it with algorithms. in fact, they tiptoe back a little player as dan bush and will admit that suckled metadata, you would mind if we

had a little of that and took it away. to do only with metadata, you need as dan has suggested, very good algorithms. i suspect that's not enough, but you need very good algorithms. google has bunch of those because brandon is very intelligent. you also need to understand the problem, and my hunch is that google didn't understand the problem. because that in a way is what scholars do. and if you push dan clancy for what he's saying, we don't really understand that stuff and why did you talk to scholars. the one thing is libraries to this kind of a proxy between the two and that wasn't helpful. so what is the issue in a way? i think this is it, what we have got out of google books is a splendid, wonderful, fascinating, brilliant, a replaceable, marbles, fantastic, can i say it again and again, but she books. but it isn't a corpus. and that's a huge difference. because if we're going to invest

in the library of the future, that's what we want. we don't simply want the old library with direct running over. we want something a little more adventurous than that and we haven't got that yet, i think. so my way i think of thinking about what went wrong is to quote from the admiral george bush as it was a case of ms. under a -- miss underestimation. some evidence for that other than things like describing the project forgot what to me, when my colleague was describing some of the rotten metadata in google, a library and stood up and said come a senior laboring, and said, don't worry about all broken metadata, you can find that book another way. and when i made a few remarks about google books, and jeff of life, rather sort of critical is going to dislikes everything,

google books is wonderful, sab many a trip to the libra and a lot through internet -- to interlibrary loan. and i hung my head and i thought if that's really what we've invested, huge resources, because libra's have invested not just google, and all we're getting a way to save trips to the library, the finding on search, that's a pretty sad outcome. because as i think others have argued, this is probably a once and for all scanning. put dan clancy to the wall again and he will admit that you have to push them quite hard, nobody is ever likely to take this task on again. google has squeezed that space out. okay, so it's also starved a lot of other scholarly endeavors. i've talked to major research centers with a huge amount of money whose directors are saying to them, give up that scanning, google is doing it.

so people with particular domain expertise are actually being told to stop, because a bunch of people have no domain expertise at all are going to do it better. if you look in the google, one of the things are klim is there going to start building on the sub corpora so they can actually sell these two lovers at a slightly lower price pigs so they will decide what is a domain, what is a topic and what are the books inside of it using the metadata they do. and that again to me is a pretty worrying constant. the other thing is also that google might give up. and then we're left with a half finished project badly executed, but nobody else willing to take on that and i say that because, and brandy made the night is come but if you look at some of the people at google in the eye, there's a look of fear about how much this cost that if you ask them how much it cost, they usually will not tell you. but it frightens them, as far as i can tell. and i've talked to several

people at google. the question, why you went wrong but if i'm right, why did go wrong? i think one of the things is a splendidly naïve romanticism. today that books were a whole lot easier than they really are. because books look deceptively easy. now, can you call those hardheaded engineers splendidly naïve romantics? this is a little unfair, but let me just say one reason why they often start off in one direction before you get a course correction. currently the predominant business model for commercial search engines is advertising. the goa correspond to provide quality search to use but we expect that advertising first funded engines will be biased towards the advertisers and away from the needs of the consumers. search engine buys is particularly insidious. we all recognize those words written by page and brin in the outline for the google search

tool. or you get a letter talking about, and he said, people don't buy books anymore. you should put your books online for free. so a letter asked him who would pay me the salary to work on the book, who would pay for my trip to google including hotel and car, who would editable, who would do the tour and the marketing, who would prepare the index? by the end of my question, brin wanted to change the subject. the reason i think is that he is innocent faith in the internet, and adequate knowledge about how books are published. so these people are enormously smart. but when you hear them talk about books, you shudder a little. britain's own article which he was writing while we were collectively at a conference in new york on about google library, what was his validation for the libra, because in 1916 i think he found a reference to an electric carpet that i did that what we really have got is just some serendipitous dipping tool

that can pull out little facts that make the whole frivolous beyond all measure. one of the reasons, i think, that this is problematic and i have to go back to what i said before, is my experience of working in silicon valley for 10 or 12 years and being around engineers a lot is there's a very deep conviction that you can divide the work into resources and constraints. what a good engineering solution does is it removes the constraint and you're left with the resource. but so often the world doesn't divide easily that way. and the paper and books is one example in which it doesn't. when we start to see the issues that come about when you try to remove -- let's remember, i think in 19 tonight is the first example of someone saying that within a couple of years where going to have newspapers without paper. and we're still battling a century later and we still haven't gotten there and no windows with the business model will be. even people in google knows who i know very well are absolutely perplexed about what the future

is. so that idea that you can just sub remove constraints and end up with resources i think is deep. and i think that goes along with two enormously powerful but also problematic engineering traits. and that is a notion of a proof of concept. at is, i can think of something with the tools i got an because i've got a very smart which will show you how this will work, at that point a lot of the very best engineers tend to walk away. that's what things remain eternally bitter because actually the hard tedious work of saying how do you ask a different proof of concept to really serious execution can hang around for a long while. let me just give one great example and i know this will drive the increasing because he asked for scientific proof, and i don't have scientific proof. let me say one case in which i crossed swords with some of the people at google. it was an enjoyable counter at the antenna. they put up on the google blog,

where they said we can pick illustrations out of books and put them on the cover. and boy, won't that look pretty for all those illustrate 19th century books. and it looked pretty and there on the google blog were for examples of books they have done this with. the first was a book called for in butterflies, the censure and was about the lives in france. and the third was studies in american fungi. all three were misidentified. the first one had probably the wrong title. and probably missed all the series information that went along with it. the second one, that was also, although it was in fact a book on butterflies in the 19 tisza, that was classified as juvenile nonfiction. the one about living in france in 18 censure was also classified as juvenile nonfiction. and the studies of american fungi was classified as cooking. [laughter] >> i then looked inside the book

because this was now not only worth looking to see, did they get information from the title page right, and no? but if they're boasting about the illustrations, let's have a look at the illustrations that you go to the first and it's a folded illustration. and google can't photograph old illustrations all you get is this mess unfolded but then i discovered what the real skill behind the algorithm was, going into the book and finding the illustrated that google had not botched and putting those on the cover. but the thing was i pointed this out on the list which i shared with several people from google, and what was interesting is the change the name and the author of the book. and they got it even worse. my idea was really that they didn't know it was wrong in the first place, and the use of this book to boast about how skillful they were. that book was up to because they wanted to say look what a good job with into. when i pointed out there was a problem with that, they rushed

to fix it and they did know what they're doing when they fixed it so they fixed it so they made the title and the author even worse than it was before. that is a sense that they don't -- what was intriguing with the complaints i got about my complete is the first person said, what on earth are you doing looking inside this book looks as if that was some kind of outrageous behavior in the second one, which i'm sure that brandon will understand, for heaven's sake this is just an engineer. they said. well now, the first point is nobody says about someone at google there aren't just an engineer is like someone is just a member of the institute for advanced studies. it doesn't work that way. but anyway, the point was, google has a lot of, the latest one i love because google has chaos is they have got is very nice, if you find an index in the back of a book you can make hyperlinks in the indexer you can find a page in the book. click on it and you get to page 43. that's fine unless it happens to

be a four-point work. the link will only take you to the page within the book that the index appears in any of the three bugs are left out. so it is meaningless. brilliant idea but actually execution need to understand a little more than i think they do. then one of the issues i think for me then is the question of, which then brought up, concerned a lot. i think this is where as cars we ought to be putting a pressure on is the question of quality in google books. how do you judge quality? one of the ways in which people often like naïvely to judge quality is to have somehow faked in those old books. those old books are really good books that this is what got me into this problem is that the faith which product guttenberg which everyone download all these old books up onto the net. what do we member is 19th century, the late 19th century is the home of some of the most

atrocious publishing that ever happened. and to those books oddly have been put out of the reach of most innocent readers. if you're a scholar and you want to look at bad conditions, you can go and find them. but they are not the first copy that you will put your hand on. why aren't they the first copy? most libraries in fact have, through a winning system, move them off into the different positives and yet to go down and dungeons are drydown wrote or fly across the state to find those books. that was actually a quality assessment process that was enormously powerful. and with good publishing and good editing and better scholarship, we actually ended up in a position where the books on the shelves probably one way or another you could say were reasonably the best quality. now google has gone in and they have sucked back out of those repositories, because those are the very first places they went

up they didn't go to the shelves which we all have acts of. library said no, go down the roads. start down there with all the junk we have got. so the very first off that came out onto the net through google was some of the very worst additions. i've been making a point about for about four years and each time i go back and look, it's even worse on google books. but the first dozen books are incompatible to anybody who understood anything about that book. apart from the vacuum and involving three and your link onto volume two of additions that were published hundreds of years later, etc. etc. so what we'd done in the way with this great step forward is pushed us back into the past. and we're partly because of the effects of copyright law but also a certain naivety about and you say this to dan, that's where the library and sent sent as. that's where they thought nothing about it. let me just a couple of points on why is it difficult to

criticize this project? well, one thing is it's great that it's wonderful that i hate to be without it and one of the very worrying thing about the summit under the department of justice guidelines is it wants to push us back to snippet you for an awful lot of books. if anyone knows how awful snippet view is, the thought that all modern book should go back to that is disaster. that's one reason we should think about it. so it's free. now i had this problem also when i criticize, how can you come along and criticize. is like going to the high school breaks out and sang that doesn't look like it came from shea bernice. but that surely isn't the issue so simply. i don't think we could pass it up just because we're getting it for free. there's an awful lot of money and an awful lot of libra resources that go into this and an awful law in the dreadfully economic field of opportunity cost that have been turned out to do this and will never open

again. so free is a good enough for me to let them off. i think one of the things that makes it difficult is google has a remarkable community character. when they want to call it a library in a "new york times" article he wrote, they called it a libra. when you say this doesn't work in order to me like a library, they say it's not a library. sometimes they have got to, say quite what they are. are they a research tool or for the general reader. if you say it is a research tool peoples no, no, no. it's just for the general dubik you can't hold to those data to give you say it's for the general review copies or streets things like i've got baltimore here and i can't find one and two of the same book and a libra and said to me, people don't read that way. in a tone of outrage that what seems to be going from baltimorvolume 12.2 is not a bad thing to do. the other thing is it's just going to get better. maybe, maybe not that i've been following one particular book. they know i'm critical of and i talked to some of them about and it hasn't gotten any better.

it's probably gotten worse. but the other thing is we can't simply allow that inevitability, that technologically future. if it's going to get better we have got to complain. with got to shout and say what's wrong with it and why should scholarly libra's have been cooperating in something that doesn't look scholarly. if they want to go to the public library, go to the public libra. the other thing is if you criticize things like this you start to look like a luddite. i think is one of the most difficult things i did with library trick as i said, jeffrey number, at a stroke he pointed out 200,000 errors in the catalog. he was thanked by google. library and went up the wall. one of the things they did and one of the things i think that distribute most of all, libraries do things worse. you will find senior librarians standing up there whenever you criticize google and said we make a terrible mess of metadata. we're awful. one thing is they don't list

200,000 books as a stroke of a keyboard. that isn't even in the capability of libraries that they don't have systematic problems but they are difficult because they have random problems yet they don't have the same problems. if you say google gets the volumes, audience has shrunk. they will say we get volume set from. the two problems are entirely different. libraries don't tend to get for volume works published at the same time wrong. they get multivolume works published after 70 years wrong, and who can blame them? but that isn't the same problem. libraries, and this is what worries me, if you talk to senior libraries, the want to talk to me about ranting about google, they will spend a great deal of their time to redeem google by trashing their staff, by basically saying all the people we employ are incompetent so therefore, why should we worry about google being bad? i think that's a deeply, deeply disturbing think that it's even more disturbing in some ways because when we said look,

google is that, they said we have a solution of. we're coming up with the antitrust. the antitrust organized by libraries is going to redeem all the airs that google has made and all the failure that libra had in the first place of setting any standards of quality on google. what do you read about the trust that the trust is no worry, pain-free solution to archive it, you can rely on the expertise of libraries and information technologists. so on the one hand they want to track their staff and say they are incompetent. and incapable of writing good training so why not let google do it. but when google seems to be, they say no, no. , we're so express oblate will come along and saved a. you can have it it both ways. either you are incompetent or you are brilliant. or that somewhere in the middle every. so finally very fun and i have gone on quite a long, my apology to the store and. historians, some have said that

it's a scholarly smallmindedness to criticize the. biblical ethical fasted in his identities of more than once. i like that one. my dear old mother, long dead, but noticing her sloppy completely careless son to have been called fastidious i think would have made her life worthwhile. i'm sorry, it's too late. to ask them volume two follows volume one or that you should be able to follow is bibliographical fastidiousness. god help us all. the ideas you just don't get, the assumption you don't get it, but you're locked in the past or introducing new ones into the big as i was once accused of. or indeed, that you are feeding pandering to special interest that none of that holds up to be. google books is great, it's good for history, but equally if a store and they'll start putting pressure, not necessarily google but on their libraries, to think a little more serious about what the digital collection of the future should look like, and

turn them not simply into a bunch of digitized books but into a reliable corpus, then we are all wasting our time. thanks very much. [applause] >> thank you. those are both good talks. my name is brandon badger and i'm a product manager for google books. i must say that i'm here for selfish reasons. because you guys are power users, and one of the things we try to do at google is to listen to our users and particularly larry are always harping on is to build for the power users but because if you do that well, your product will work for apple announced that when i worked on google earth and google maps, has anyone had a chance to play with that? you can spin the globe and sort of spy on your neighbors and see what they're building in the backyard that in that world i was meeting a lot with people in geologist and people who just worked with this world and try to soak up all of their

learnings so we could improve google maps and google earth. we still have lots of problems that i do a search for how to drive from new york to london and it would tell you to swim across the atlantic ocean. i think we put that in as an easter egg. it tells you to drive off the bridge that isn't there. there are lots of errors and. we are constantly working to improve that. part of that is improving the sources of our data, part of it is improving your algorithm. you have all these data point where the addresses are located and where the roads are and how big the roads are and you have algorithm that is trying to pick the shortest path between those points. you can improve that. on google maps we worked a lot to help the users fix things. so now if you type in your address for your home and it's in the rocks but you can go to google maps and corrected and it improves the system. so there's a lot of analogies there for what we can learn. now that i am on google books how we can fix the things on

google books. so i think it helps what is google doing this? why isn't microsoft doing this? we are a corporation. we have shareholders. it's not a cherry-pick why are we doing this? i think it helps to kind of understand the culture and to our founders are. i think they are very unique. which is what makes it an exciting and fun place to work that you have probably seen some of the bit is that you can run around on scooters and free meals and it's a fun environment it but it really is sort of an engineering driven company and i've worked at other places where it's at the mbas and nba's andersons and they are sort of done their market research and telling engineers wanted to. this really is sort of a unique company what it is flipped and very much bottom-up driven to a lot of parts are coming from the engineers idea. something like gmail. one engineer decided we can build a better e-mail system and if anything ever told and that's a stupid idea, there's already tons of web e-mails out there. the engineer felt passionate

about and was given for free to work on it. projects like google books and many others are at the same way. someone who is passionate about the topic at google is a unique environment where you are given the freedom and often the resources to be able to pursue those. with google, even going back to their days, they were a little older than me at stanford that one of the problems, their problem-solving and the like to solve big problems. one of the first problems was how difficult it was to find information in scholarly journals and books. one of the first ideas even before their idea for the search engine was scanning books and making those more accessible. would seem like a crazy idea so they went on to the other crazy idea which is making a search engine and making it easier -- likely, that went very well. [laughter] >> and a lot of ways it's sort of that success has given them the opportunity to do this project which are very passionate about, and this isn't

part of google. it's not a cherry project or but it's hard to qualify it as a necessary just business oriented as well. it really is something that's driven from the passion of buglers. with people and we feel passionate about this and we are excited what we work on. that does play a large percentage of what we are doing here. so what are some of the things i'm excited about? continuing on that story, so why is google books? you for the mission of google, is to organize all the world's information and make it universally accessible. the ideas what about all the information that is preweb? you know, for example, all the information in books, what can we do? that's where this came from. so there's a lot of difficult engineering challenges there. scanning books, you've all seen the hands on the prince. some of those are mine. [laughter] >> it's a hard thing.

i'm trying to learn how to chip a little better in my golf game. it's not working that if you were tatami scan this book, it would be, i could get a really high quality camera and i could spend all day taking pictures of it and working on it. i could spend time at researching and getting all the data and the transport and doing a good job. our challenge is how can you make that to scale? how can you do that not for one book, but for really all the world's books, for millions of books. even google we don't have unlimited money. there are research constraints and it is money per book and it's also time. to do every book perfectly, you could do it in a way where you do a perfect from the beginning and it takes 100, but then we're all dead. but this really is sort of the start of a long project. one analogy is, do you remember earlier in the web days when you load an image on a webpage, the jpeg images, it would look

perfectly but it would sort of feel and slowly, that's one good way to fill in an image. now you see it loads the whole image and a sort of is more and then it goes in and tell it gets perfect. sort of the analogy, that's what we're doing at google books and we're trying to make this information as accessible and useful as much as we can, the 80% therefore as many, sort of in your lifetimes. we can continue to go back and fill in and work in the gaps. so what else gets me excited? i think the marketization of this information and making -- it's exciting to me to think a student in anywhere in the world can access to this information. and you know, so i think at this point i believe time for questions. great, thanks. [applause]

>> thank you all again to all of our speakers, and we do have plenty of time for questions. so i have been encouraged since we have the television there, but anyone who has a question, please go to the microphone and speak it in there. otherwise, i will leave it open to the audience. anybody. >> my name is jim goodall. i have to wonder what books published and my concern with google books is a lot of stuff i do, i have dealt in a similar classified environment. i've got some in an unclassified format. i spent many, many years researching, interviewing people, little red dots on my chest out in the desert. you know, what is my incentive if everything i do eventually goes online to continue to do what i do because -- i've seen

some of my stuff that only i have ever inquired i've seen it on the net from places in europe and asia and whatever. that's one of my main concerns. we have copyright, trademark standards here in the u.s. and a lot of countries signed up to it. but there's a lot of characters out there that really could care less about intellectual property. >> that's a really good question. i think with the internet, it offers a lot of opportunities but a lot of difficulties and challenges there as well. from our point of view, on google, we're trying to be basically, help you reach the audience of users who want to purchase your book. so what we're trying to do, what sort of a topic he wrote two books on? [inaudible] >> so what i'm hoping for is when someone just go to google and i search for the blackbird plane, we want to be able to

show your book. and ideally give them a little snippet that reinforces to them that this chapter three of your book really needs answers the question that their anti. and that we want to buy links where they can purchase the book. so right on google books we have links to amazon and barnes & noble and borders, and basically the book retailers can input their price inventory data into our system. and then we think these users out to the. were also working on an initiative that we talked about called google editions where we'll sell digital access to the book. so users will be able to click right in google books, paid a $25 or whatever you want to pick a price for your book, and then they can have immediate access to the whole book right in google books. what's exciting about that is with digital reading, i don't think we will ever lose the paper book, but digital reading, the idea is you can keep your books in a cloud sort of a buzzword right now, but we are

making available lots of different devices and access points for the users to read that. the idea is you can get him, maybe it's a sony e-book red or a samsung reader, that constructively to book and when i'm on the go and i have my phone with me, i can continue where i left off. so i think it's -- i think it is a compelling offering for consumers, and then ideally you would sell more books due to this exposure. there is a lot of piracy on the web. when twilight or some big book comes out it seems like the next day it is on the web. goes on and scans from google. those are people, that even crowd sourcing where they say everyone on a website, then they put all together. so they are quickly able to transcribe these popular books. i'm not sure if there is a solution to completely stop and pick one solution is to have an alternative legal way of users can buy things really quickly that we have seen it in the

music industry. for a long time, then music publishers were resistant to selling digital music. so there wasn't a legal avenue for consumers to buy music. so there was a lot of piracy. it seems to me when apple came out with itunes, it made it that. your time, oftentimes it's not worth your time, you know, to go find the free music that it's easier just to buy the song for a dollar from itunes that i think hopefully that should mitigate some of the piracy. >> thank you for your brilliant overview. my name is christopher, researcher from hawaii. i'm very interested in the new google iphone and the opportunity to look at some new trends in history research that can help a lot of students. if you look at it, let's say, wikipedia. is basically familiarizing people with a broad overview

first before they get into a very detailed specialized research. are there ways to visualize, conceptualized that process whether it is mind mapping or maybe a timeline that could be a new way to help people look at that familiarization of it of a particular period? there are good books on timelines and the ability to look at a timeline, stretch and shrink it, and then go right in, maybe a helpful simple way to bring history together for a lot of people to look at multi-trends, trends within a particular time period. and through that visual structure, similar to gis, you are looking at informational systems, economic and using a late system along the timeline that would really help them visualize and familiarize that system in a way that makes sense. and i work with one of the

leading geniuses of gis, and he started with a very simple principle, the layer cake construction of reality. when you're a little child and happy birthday, and the birthday is so good with a birthday cake. las. .

on the side of the interesting to france and analysis into the digital book to maybe could then do with a paper copy it so for example on the google books have an interesting project where we are able now that we scan the book are able to find place names. so let's say it is a book like around the world in 80 days and actually able to extract the places and then you can do a mack view of a book. one you go to google earth and you can zoom in on a location like on london and then you see the references in any book that we know about to that location and as interesting way to find information. you mentioned time lines. google research has something with extract dates from web pages and are able to do a time line so you can search for like

george washington or simply give from history and then see the spikes on the timeline of the books are referencing the person. that's on the data extraction sign which is interesting and then i think it's exciting on how you can augment books and make it easier to engage with the contents so here's my golf book and it has quotas for how to do a pitch shot put want to see is a video and i am setting a history book i was out on the aircraft carrier and i'm reading a book about that i want to see the videos from the world war ii footage and i want to see maps and see where this aircraft carrier went and more of those. wouldn't it be great if users could contribute to players like gone google maps. people can create these maps with and these photos and videos. you do the same thing with books were you still have the core book, not missing with that, but to decide if you have these layers people can turn off and turn off and share and augments.

i think back to my day is going to school i would read a book and maybe understand 20% of its and a half two go -- my professor would help me get a deeper understanding and have a classroom discussion in and get her input. i think in the digital world where we are connected it's exciting to think about virtual book clubs or virtual university class is for you can get together and discuss things and maybe a professor rights there authoritative layer that slices and this is the book and explains its and i could find that as well. >> if i could comment on that because it highlights what i was trying to get earlier is right now there are those lawyers existing in google books and they are written by google engineers. there are mapping tools of things to concede that google has access to. the have a hunch and they can write to see all the books ' any other book even if it's not in the footnotes but we don't have access to scholars and haven't been able to create anything on

top of that. all the other google properties i talked about act as platforms on which scholars, software developers and users can build things. we haven't seen that out of google books in some of this is the legal problems but it's still the intense when you look at this and here's where i very much agree with paul is there is a tone deafness to the way history is rich and complex so the kind of things engineers to of history is they extract place names and make a map. and hope that's interesting. but there are others among us that want to do other things on top of google books. we don't have the kind of access to their programming in prime as we would like. >> if i could add to that an echo every to become best of friends if not careful, because i think that point is absolutely right and underlines what i think i was saying about proof of concept. the google algorithm is great except is one of all to discover that part of king lear takes place in upstate new york

because the duke of albany, of course, -- there is a place name for you -- or a friend since the trollop when he wrote to the warden was writing about maternity and child bearing, a very and taliban thing because when he took out those wonderful quotations they forgot their advertisements in the front and back matter of books so of you with the most quoted the spots of their published advertise in the front so the proof of concept is wonderful but the details and execution to get it right so that if you're layer dated doesn't take you to the wrong place in the wrong time use exactly the inputs that dan is calling for an google doesn't allow and i think that is why in a way some of these tools are enormously powerful and completely under fulfiled. >> i am writing a dissertation in history but my real money job, history is not enough money, and a library and new york university and i'm one of

those web people. with becker and bibey this pc laptop so i'm learning how to use a mac. i am still seen by the library of administration as one of the is because i think that books are still in important and those algorithms are a problem. we are using algorithms to read half a million bucks at the library they haven't been circulated but any historian and in a humanist and a lot of other fields they don't go and check out every book that they use, they look up a friends -- reference or citation and that doesn't get circulated. it's taken off the self, some people put them back and some don't, they don't get counted, so my experience with google books when it first came out of my dissertation is on gender and anarchism in spain. there are so many problems with mapping because when the spanish republic came in all the royalist street names renamed.

when the revolution took place heavenly things were renamed and then when franco juan industries for renamed. then when the market. >> and bring good guy the streets were renamed. oslo the capital of norway was there and for a long time. those are problems that i think google has to solve, there are problems with the way people use in the concern me and we see it in my university when i talk to other colleagues and people in europe on the international labor history institutions so i'm interested in the article. people are coming to the library because they think they're finding everything they need to find using google and they're looking at things uncritically. and they are not -- i don't know how many students come to me and say i want to write about the battle of saratoga and i need to find a counter or recently a student wants to write and about

sailors meaning rank seamen, the accounts of the napoleonic wars of been a sailor and a center going to be hard-pressed to find a first-person accounts because most sailors were not illiterates. but they use google and they have an article of the diary that was old and want to know why they could find a library, unable to make the distinction. and i think dan is right that the google books is great, pro quest, god rest when ebersol they may have left, are much more of a problem because we get gouged in an endless marketing were over to 2% of our budget goes to electronic products. what many of you may not know that a product itself may not be that expensive, they hear this every year with maintenance fees. with electronic journals, we end up paying a lot for the journal, we are paying for the maintenance fee that every year escalates. i'm also on the new text mining project board ninth with center

for history new media and some of those products look really great. i really look forward to seeing what can come out and i think pena will to do some of the stuff that dances you have algorithms for and making them available so we can start using them and getting people to use them but my concern as a librarian is more that people come to me and saying i can't find anything in google on the greek force removal of breaks from turkish territory after world war i. they don't realize that if they don't know bregon don't know turkish, google is not 25 for them. >> definitely google books is just a tool and i wish i could make this all great historians but there is more to it than that. i'm sure you can attest to that. i think students see it as a tool so that may be a source pointing you in the direction of the library's second help but they still need to get add of the pajamas and go to the library and interact with the original books as well.

>> go ahead if. >> is used to mean that there are two difference strands of criticism of google books, on the one hand, questions about access and actually some ways in which google allows access to things like a pro quest and then questions about quality of stands were dated in individual thing so i'm curious as to how our panel of critics, paul and dan, and from a library perspective if sean wants to add, how you would evaluate what is more important because one of the points dandridge to make was the access questions aren't being asked nearly as much as we hear about hands on pages were things out of order and i'm just curious about how each of you when way those out. >> year quickly i think dan in

many ways of resolution. i always talk about the problems but opening up will make a huge difference because well as an engineering project there aren't going to fix those problems and people like dan get their hands on it and other sanctions are to say this is how it has to be fixed and the difference will be huge but i'm not very excited about google opening at. >> you could compare with the google is doing with a dividend to the internet archives of the library project is doing which they've completely changed and outsourced and they have gotten a very strong support, the library of congress which has donated records and other places. i would love to hear and maybe brennan can help out but there was at some point to a big meeting about the bollea graphic intro and some kind of unified system of a vendetta improvement and sharing. again i feel that a lot of the quality issues can flow at a more open environment where we have a better sense what is going on. errors can be corrected, and broader ways from institutions

and individuals. >> the question of which is more important, they are both important and we have to fix both. going back to the maps analogy, how can you fix the bad directions and web mack, part is algorithms' but also lives in the raw data and building the tools so that the experts in that domain -- who knows better about where you're house is located in new? so we gave in that world maps lead to a place on the map for your house is. of course, you have to build tools and there for the prankster high school kids will start moving things in the hospital, but you can solve that. you can see two people said the hospital is over your answer to trust that and the credibility. we have taken baby steps toward that on the google books and we have the feedback button where you find an error you can fly into and that brings it up to our attention so we can have a human operator tried to fix it.

that is 5 percent where we need to go. that's definitely the direction where we are going. i want to get to a world where when you see an ocr errors where we've done something funny and mess up in the transcription mayor, why shouldn't you be able to type in and fix it right before us and we can have a system that takes the input. two people say this were to be this and we can trust that. i definitely think that's where we're going. >> just one copy as about the data issue. i have written about this, i think the data is pretty weird stuff and i think i looked at the project like grace notes which tries to open source the identification of tracks on popular albums in the archive which is the archives that identify if you use itunes and the album spirit a goes astray very quickly. it actually is a hard thing to open source and am not sure the internet archive is having the

success it helped with its wiki. in principle i like the idea and i think it's a hard idea. i think metadata is third difficult and weird stuff. >> i agree and doesn't completely solve it. just turning over of metadata into wiki doesn't solvent but it is a weird stuff. >> usually as chair i try to step back from these things and not make a comment, but since it's been pointed out several times and the only library and on this platform i feel somewhat obligated to say a little something here. and from the library perspective the of all these issues other loss of criticisms to be made about google? certainly. however, we can certainly say that ed least i used to work at the university of michigan the wasn't directly involved in this project, that we have a digitization program is going on for a long time before this war we were dealing with all these issues but the problems of intellectual property and the criticisms brought up here are so huge it was usually just easier not to deal with them.

so we didn't. and for the purse time when the google comes along and says we can do all of this we can digitize all these books that the university of michigan would have taken over a thousand years to do with this that we currently have, and i think we owe them all a tremendous debt of gratitude in that sense for if nothing else realizing that these issues exist and that we haven't been dealing with them. so from my perspective a lot of the time that i think we ought to be focusing on here and what is important is that we have tremendous possibilities that google books and things like google books open up, is a pervert? no, are we ever going to live in a prepared to grow? in though. so what can a things can we do and some other things ever brought up with gis and mapping and bringing these books together, how can we were to get something that's maybe not perfect but it leaves it can pass. also kind of the things that you're bringing out as an

author, myself and to, i want to get my work out there in this debate and how can i do that in a way electronically that is probably going to be piracy, yes. but i'm also going to get my work out there to a much broader audience than might have been possible before. so i guess from an fibre point of view this is really how we see it to. that this was a tremendous opportunity to bring these issues to the floor and now it's a matter there are lots of imperfections but how we work together to try to get them into something that's at least passable and those of us can say is okay. so, thanks. >> i first want to thank all of you. i was surprised to find how much sympathy i was having with all of your arguments as we went along. i am all there for openness. i want access to the api and what that data. i am trained as a medieval west

in literature so when you start talking about the books and talking especially about the metadata, about those books, who owned them, where have they been, i right there with you. in i now work as a strain to be used in instructional technology specialist. i'm working on trying to code it up -- not quite up to google standards but pretty close. it's interesting what you're just turning to get into really the focus of the question i have reviewed because when i heard from everyone i think it recurring theme here is trust. how do we decide when we trust data that we have a and how do we decide whether we trust this answers that google is giving us? so i was wondering if i could just ask all of you to maybe look back at what we've got so

far and think as a scholar trying to produce an argument, try to get my information together, of what are the standards of trust that i would like to see at work and in play in a project like this? >> good question. >> i will start. i think trust is a good question and i'm not sure as an historian will and academic it's always good when two not be fully trusting. we've all gone into the archives, i certainly have where people live in letters that we read and forge dates and the airbrush people out of paintings and photographs. it's not too bad to have a little bit of paul with us all the time to be the skeptic, the knowledgeable skeptic. [laughter] who can see that there may be reasons to not trust things. i think that's not a bad feeling and i want to give a quick

example that shows this because i've been in brennan's position at the center for history and media where we cooperated with the american social history project of the city of new york in the digital archive which was a very large archive of digital materials that we gathered by the web in partnership with the library of congress and the smithsonian collecting the visible artifacts, we collected the digital stuff, and we ended up with 102,000 objects we gathered over the web. i remember going to the society of american archivists to present the project, the results of it, and immediately people started standing up and said it's not an archive, you know someone didn't buy when they said you were colin powell, what will you do about that. i guess my sorta was a response at that time was we don't check our brains at the door when we look at these things.

that we have to go with some amount of skepticism and that's what we want is and i think what paul very good point is is we actually need more metadata. but we did in the september 11th archivist try to provide the researchers, but that the archive now the library of congress with as much metadata as possible. we got the submission here, this is the ip address, this is the location of that address, we tried to e-mail the person and it didn't go through -- years all the things we did. but at the end of the day we have is a rauf archive that we knew was problematic and we tried our best to reiterate to worth something that was decent and usable but we left it to the historian, the smart historian in 50 or 100 years to analyze all the material and to measure against other sources as we do every day. so at some point we're going to hit that wall i think with google books. we are not there yet and i think brennan will admit there's a lot

to be added but as in free speech more free speech is better and more metadata is better, or did the metadata come from, rather conflicting sources, have someone waiting to say this doesn't look right? all these things can be helpful to the scholar to assess veracity and thus build trust. >> the only thing i would add it is one of the key things for trust is having sources. we have probably stand tens of what versions of a particular version of hamlet so if there were a case where i would take one book that had something airbrushed out or scribbled out, ideally we are helping by giving access to all 10 versions of the book from tender libraries. so with more resources on the metadata with more resources you can make a better decision about what you trust. one anecdote right now our core web site is tried to be made better, additionally our side was with a bad home page and we're making it easier to browse so i've got a senate seat to

quicken the computer subject. why is hammond at the beginning of the computer subject is so we started looking into it and we get the metadata sources from the book from 30 different sources. 20 all say that to this book should be in the computer section but then we have one random data source that says it is a romance novel. algorithms orrin set up to deal with that. we were too trusting in the case of that data source. but the advantages we often have multiple sources so you can do a simple logarithm for you trust of 10 people say this book belongs in the computer section is, more likely that and the one who says it's a romance book. i think the key is the outsources. >> i think the question is a very poor in one, it's a tricky that in general there's an awful way in which this is shoved off on somebody come off sun -- off and on librarians which is called digital literacy and

assume there is a way that magically weekend to read this. i would say to a google search on anything and looked at the results you get and then think about which when you click on and think in a way of what kind of years and years of the body of knowledge goes into the decisions about when you can click on and what to avoid. is how do you short cut back? i don't know but it's tricky. i think one of the things that google has going for it although i come back to the early page on the suspicion about commercialization because i think google searches are getting worse, but they had an enormously reliable ranking and in general don't unless you have something very strange going much beyond the first page letter alone the first three pages and then stand brought this up and is terribly important that there's no way of understanding how that maps

across into google books. how the first seven books range, what that means -- it's certainly not the standard page frank alvarado or anything like it. so what that means and how you're meant to make sense of it i don't know and that would be alright if somehow that was black but the fact it looks exactly like the standard google search and therefore somehow you are meant to trust in the way you stand at the same google search strikes me as enormously problematic. there are ways in which you can disrupt that order because it doesn't work. another thing that, in fact, i would just say although i know people used to work with the xerox and went to google, i admire a great deal but somehow it worries me that the very first figure you see in google it is to be blunt a lie. if you look at the page count that a given number of hits, it is almost always under the false. why? well, some of the answers have

been given it would take as a couple of nanoseconds lager to get that figure right. we will take a couple of nanoseconds. but if you want people to trust you don't begin by lying to them with a very first thing they see. >> i think to that point there is a lot of difficult engineering that goes into figuring out how many hits certain a query hits on, but -- go ahead. >> ic3 university. i apologize in advance for this question, it's confusing because the subject matter of time confusing. i was wondering if the 21st speakers might comment on the. underlying tension between i guess what i would call the fragmentation on one hand and comprehensiveness, on the other hand, when we think about information resources.

it seems to me that there are costs and benefits to having inquiry approaches than either kind of embrace fragmentation or go for a comprehensive approach on either side. often human life and feel quite fragmented and so the modern world may be best understood from this angle or that angle and at the same time historical society is often like to aim for having a comprehensive view of culture and knowledge, etc., and perhaps harder after dante's time. i'm not sure but what i guess i am looking for from you is, how google books contributes to the kind of the latest round in this tension? and kind of a societal perceptions of whether the sources better use our

fragmented to start or comprehensive to start. maybe they interesting in the log is the example you brought up of the book which looks very beguilingly simple and kind of it commands of some kind which, in fact, is much more complex underline that. maybe this is all a roundabout way of asking is kind of the comprehensive d that google books is hoping to get and may not achieve it is that really kind of just then the fragmentation for our era? and what does that mean really to users at the end of the day? so maybe you can make something out of that model of a question. >> look, what google excel that at first and continues to exile last with the exception of google books is that if this a master of abrogating resources that are at web skill and providing search and access to

those things, that's what it was always of to do. i said earlier about a google books to be in on property within the google plaques and here again i feel it's very strange there are trying to come up with a comprehensive library on the campus and what they've done all along is say go forth and have the thousand servers with a thousand books and we will provide an overarching search and access to the materials. one could have imagined different google books search book that would have as all noted a subject of maine, experts, digitizing small quantities of high quality and providing as they do with web sites access to google where google provided what is good act. what's strange about google books is they are trying to do the aggregation themselves. and for me that is not webb scale. so again i find it's a very on projects for them to take on and i wonder if there is a different version of this that would take what has been scan scattered

around the globe and does something on top of that as they did with web search. >> i think that's a very nice point. a very early on google talk about the library project before they started denying it was a library and i said their aim was, our goal is to create a comprehensive search or virtual card catalog of all books in all languages. they changed from that in some ways if they had done that and have led other peoples to the scanning and provided ways they say to help readers discover books on the world, that would have been i think in many ways playing to more of their strengths. now they could certainly we hope give some of the money they put into the project to help other people to the scanning but it might have been better if they had left some of that to other people. the basic question you asked i think and you know this has all sorts of the decedents, the alexander myth, the idea that we can collect everything in one place.

and, of course, again i don't to keep going on about this but there is a wonderful naiveté which got the whole project started in its greater that reason but when they began and they said they're going to organize all the world's information. ..

>> so the way in which different generes were in the property is very, very different. we confuse ourself when we lump the ball together. and libraries have lived with that confusion for a long time. we have found ways around it. it's information it's a simple concept. it glosses over more problems than it reveal. >> on the fragmentation, there's an interesting story for the profession that had researched something. they came back with all of the books. it's all books that were available on google books. i think, you know, the risk is that google books is too useful. it's too easy to do research in your pa somewhere -- pajamas.

i any it's up to you historians to see it as one tool. you still need to go to the library. we don't want to get to the world when someone goes the research they only do the research in google books. >> push that back for a second and talk about how google money indicates what it does. i think that's a fine arms for all of us. but what -- since your trying to kind of create -- >> sorry you might want to talk into the microphone. >> since you are trying to create the optimal user experience. how are you going to direct us into what it is and what it isn't? and where will you actually say we're going to be comprehensive and up here, but we recognize there's everything over here. and we're going to give you the platform tools that hook into the rest of live as opposed to kind of maybe making people think this is kind of the only

one or something like that? >> that's a good question. we're doing our best. and, you know, we are adding tools that the user can build on top of that. and we do have programming interfacing that are available where you can search for the book and return to the day that you can embed our preview in your our site and build on top of that. that's definitely the direction where we are going. and going back to gook the, there's google books and google the of search engine. our hope that is other people will continue to scan books and do similar projects. from google search we point to the users to whatever has the best sources of information. >> well, and just to build a little bit on what brandon was saying, speaking formerly, the way that we really saw this, at least for the books that we owned, that were our booked

scanned by google, we built our own database for searching of the books. in many ways were we're trying to you've on some of these issues that we've been talking about. -- improve on some of the issues that we've been talking about. it's n books, which is kind of the implementation of all of the google books that we with had at the time and are continuing to build on. and also trying to credit some of the meta data issues. really from a library perspective, this was a great way to get the books scanned. then we could kind of handle all of the problems for our own stuff as we came along. as the books get google indexed, presumably if people search on particular topics, our books will come up there as well the google books. i don't see these things as being exclusive but trying to work together. building more meta data and

think about the kinds of things. >> hello, i'm alex from the evergreen state college. my question is it seems to me the criticism of the academics and the librarians about the way the google books has put together and meta data has organized are probably accurate. it doesn't sound like there's any incentive for google to respond however accurate they may be. i'm guessing that it may be because google owns and operates the means of physical storage. i don't know if that's accurate. i suspect that at some point it will be. why don't you guys team up. why don't you -- why don't libraries help share the cost of the physical storage of google books. that way you can have more of a adventageous position for getting the information. >> people -- we definitely want to work together; right?

we have some expertise that we're bringing to the table. it's sort of like the computer science and those have the benefit. especially when you are dealing with millions and millions of books. if there's a problem in the meta data for this book. in our general frame of mind is to not just fix the one problem, but try to figure out how is the algorithm? we thing that the to the table. obviously the historians and librarians, they have their own. we want to work together with the different groups. >> again, i feel like i'm talking too much here. but from the library perspective again, i don't think google is the only one. michigan was storing all of the books that they scanned in their own databases. for us, which is an issue not

only important for google, it's important to use that as other storage. librarians see that as an issue. >> hi, i'm the graduate student. id also like to follow about the account about google books being extraordinary influence for students like myself who are not at harbor or stanford but now have access to all of those libraries. >> hold on a sec. someone is talking to me. one the concerns that you have -- and you kind of eluded to it earlier when you were discussing why it is that google books is important to google. one the things that you highlighted is the fact that your founders have something that's critical to the part of their mission. and google, my concern of course

is that they think of golf, they had grand kids. if anybody has been followed apple, they get ticked. that is my concern, at some point, what is potentially going to be the most extraordinary digital archive in existence is going to be potentially be able to be turned off when they take control. and they always end up taking control. i think you can look at -- that's true. as a shareholder of google, i some point wanted them to take control. and the graduate of oregon is critical that it stays affordabling for people like me to continue to research. i mean that's probably a fair question. it's not really something that you can answer. it does seem to highlight the point that there has to be a way for this information if somebody something does happen with google that it has to be stored in different places. because if google turns it off,

then it's done. i currently have 1600 volumes of medical journals in my library. and if google decides one day dunne due to the current law, this is just not worth the las the. i have lost all of that data. >> that's a good question. obviously, you know, hopefully the founders don't fly on their plane together at any one moment. they are not allowed to. in case there's an accident. they have done a good job of really pushing out the culture throughout the company. it's part of basically everyone there. i think that even if the founders did go away and some evil businessman came in and took control, i think we could kick them out quickly. there's enough -- it really is a bottom -- the power really is distributing to google. there's really no master plan from top down. it's really spread out to the corp engineers who are making a

lot of the decisions. you've all heard, don't be evil. and it kind of sounds silly. people do take it seriously. it's a company that's built on trying to be different than your ster stereotypical thought. you know, if i could -- could google tank? what would happen to the books? it is a valid question. that's what why it is the library. when we check out a book from the library, we make a scan, they get a scan back. that's why it's important that other people do this as well. when we check out of book from the michigan library, it's just like you check it out. we check it out, scan it, give it back. when we do that, we don't damage the book. we don't want to be the only one with the digital version.

>> librarians already thought about this. we wish with the best for google. i feel somewhere ironic since i'm wearing the suit. paul mentioned the trust negatively. without kind of going into that comment, what it was founded to do is bring all of the g whatever it is now, the google libraries together and try to figure out a way to preserve this content. and if, you know, heaven forbid google went bankrupt and goes away, at least there is somewhere that has all of the content together and is working hard to preserve it in some kind of managed way. libraries have thought about this issue and are working on this issue. >> i just want to pay a compliment for google. but at google earth is anima any

sent product. >> thank you. >> and it gets it's appeal not from the amount of data, but rather than by how easy it is to move it out. you just feel like you have the whole world in your hands. is there in google books -- without revealing your secrets, where are you going with novel waves of the moving about all of this huge amount of information? beside this keyword search? which i imagine is where you are beginning. >> yeah, you know, i'm in charge of the web site in a lot of ways. i'm almost embarrassed by web sites sometimes. i think that step one is sort of getting all of the content and getting the millions of books. i think the next phase is if you have all of the books, how do you make it easier to find the information in the books? it's a problem. i kind of thought like the music world. if you had access to all of the world's music, what do you want

to listen to it? i think we have that in google books right now. you go to the home page, you know there's millions of books but you don't know where to begin. it's something that we need to address. some the interesting trends. i think social is going to be an interesting way to discover content. so, for example, that's how we discovered what to read often in the. . your friend starts reading a book and recommends it. or you want to read it together and discuss it. so maybe it's -- you know, and g-mail you have your contacts and your friends e. if we can start people with their reading book. the big thing with facebook is activity streams. it's pushing updates. when you check your update, here's a picture of your friend bob at zoo or jane updated status.

i think an interesting way is starting pushing those updates of bob finished this book or jane reviewed this book. and you start to define books that way is one interesting trend. but then also giving people the tools to create their own collections. so, you know, if you are interested in golf, someone creates their top ten books for golf. you allow the community to basically vote on and filter those collections as well. a lot of them do it well. and when you search on the topic, you can search those as well. i agree it's a problem. the problem now is you have so many books, how can we do a better job of helping users find the right book for them? >> we have time for a few more questions if anyone has one? >> the other zesting trend is mobile. i'm really excited about the smart phones and tablets and device. i have a kindle.

and i think they are great. there is sort of a -- an attachment to physical books. i can't bring -- i can't read my kindle at the bathtub or other places like that. it's really convenient. you can't can't -- the ability to get a book within 60 seconds. wirelessly. i think it's good for readers and authors. we make it easier for readers to find and get the books quickly. i think these devices also can encourage more reading. if you think about it, as these devices get cheaper, they are about $200 or you can get them for free on a great plan. i think in two years a lot of people will have smart phones that have a large enough screen that you can read on, have a data plan. more opportunity for people to do more reading maybe on the 10 minutes on the train or moments in their days when they might not have otherwise lugged around

a book. just with the interactive screen. we mentioned the exciting things you can do where starting to do more of multimedia with the book and connecting books together and doing notes and that kind of stuff is also there for you. >> one the things that's been interesting to listen to you folks, one the things that's interesting about listening to you is it's almost as if there's a conversation not happening. and -- i mean -- given that we spend a lot of our time walking into a room full of vibrant young people who immediately begin falling asleep, i know that the way we talk doesn't always hit with the way that the rest of the world thinks. at the same time, i can hear people eye's rolling. you read that? why? there's no footnotes. and so what i'm wondering is do

you folks at google hire people to be the people that interact between your power users and the folks like you who are actually designing these things. >> that's a good question. just for product design in general, the risk is you create a product for yourself and not for your actual users; right? >> you might want to talk more. you know, our demographic is in a certain, you know, key way. the risk is are we building a google books product for geeky engineers. we don't want to do that. what's the solution? obviously, we have more p communication and coming things like this and talking with the actual historians. >> i have a guy that runs a grad program might have a solution. >> that's a good solution too. >> available for the right amount. [laughter] >> you know, we do have a u.s. user team that we work with. we'll put an add in craigslist.

>> i would recommend h-net. >> h-net. [laughter] >> i have a job. i'm not looking out for the grad students. it seems like -- like you said, the usability team in which there's a lot of people that you are thinking about, we can encourage more reading or if a book is a single text that we want people to read. these guys are thinking like each book is useful for it's few quotes. i want thousands of them to be used to make broad arguments that make our students eyes roll. >> that's interesting too. the diversity and types of books. it's very different. a book like "twilight" which is fiction is different. the ui needs to be designed for that. rather than a really dense academic book where you are doing different things and researching through it and trying to connect quotes and

thoughts versus the passive reading. and it affects -- for example, an device like the kindle. it works really well for fiction. but not scholarly work. it's hard to flip pages. we're thinking through those issues. we have to come up with better solutions. >> thanks. i just want to say we have two more questions. we're running a little short on time. please both to our questioners and our speakers. >> i'm a librarian actually. and i'm practitioner. i use google books to find answers to questions that i could never have found before. but i just have a suggestion for you when you say in your next step and you mention the social networking thing. well, i lost interest right there. what you really need to do is develop a more powerful search engine for proximity, adjacent, many more things that i can't do right now.

i want this word in the title, this word in the first paragraph, maybe these two in the second. i don't care what sally, on the facebook page. that's not what i use google books for. >> i think that comes down to the use cases. like the previous, where do you get this input from? i'm sure you see the popularity of facebook. you go that's great. i don't know that that's what people want google books for. they want it more for a research database, i think. i use it as a index. i should get that book for interlibrary loan and use that to answer the question. >> testify nitly, the scholars, they are the power users. i think there is a different set of users who it would be nice as, you know, just findinging -- you want to find a fun of fun book to read.

we want to support those users as well. we need to support both, i think. >> okay. >> my hunch is that google took librarians for proxy for scholars. they had to talk to librarians and i think they are starting to but i don't think they did in the past. i think that was a problem. >> i want to build on the last. i'm not a librarian. my first session that was dan and brandon go out to dinner tonight. but i mean that actually more institutionally. the worst possible solution is to find out what sally is reading. when a student goes into a library or anybody working with a teacher in any environment, they are choosing books based on what the library or teacher suggests. and what you're going to end up with instead is what you have have with google. which is an algorithm that's based on market rather than

expertise. it seems to me it ought to be possible to work with scholarly societies and all of the disciplines to create algorithm for google books. but to create that would also include authority as well as market-based phenomenon. >> that's a good point. i want to build a tool so that people can build different collections. someone might put together about romaunts -- romance novels, but i want it to work for the scholars too. and basically reputation is important as well. so if we get to the world where there is margin notes and sanitation, that's definitely important. you can imagine who the author of the book is and you get more ways to that person. users get comments and those are voted up or down. basically as the community validate that is you contributed good thoughts to this conversation. you can get voted out. so i think that's important.

you know, i think as far as connecting the dot, my friend is building more tools. to google books -- it's a large thing. to spend focus on the engineering challenges of scanning the books. the next is making it easier for the user to organization those books so user can find the data that they need. [inaudible question] >> yeah, i guess i'm using the word user as a subset of users. it's of all of the users who are organizizing data, building ways to identify those who you trust more than others. >> and on that note, i think we probably have to say that though this is a very valuable conversation, we obviously need many more, maybe this is an opportunity to kind of begin

this within the society or elsewhere. i want to thank all of our speakers again one last time. [applause] >> i thank all of you for have a good rest of the conversation. [inaudible conversations] >> here's our schedule. next mississippi state haley barbour delivers his address. >> all day massachusetts

residents have been heading to the poll to elect a new senator. the candids are martha coakley, scott brown, and joseph kennedy. after the race is decided, we'll have acceptance speeches here on c-span 2. >> this weekend on book tv, john mueller believes the chance of terrorist attacks is smaller than people believe. and from the annual operating cost to globallg, anne talks about her book. and get the latest booktv updates on twitter. >> now haley barbour delivers the state of the state address. we spoke about hurricane katrina

and how jobs are being created. from jackson. this is 40 minutes. >> thank you, y'all. thank you very much. [applause] >> thank you, y'all. thank you, y'all. mr. speaker, governor bryant, members of the legislature, distinguished guest and fellow mississippians, for the 7th time i'm honored to come before you to share my view of the state of our state. i appreciate your inviting me, and i want to say that i appreciate mississippi public broadcasting and it's presenters for telecasting tonight's speech live, again for the 7th time. welcome back to all of you legislators who had to go home early the last two weeks during the icy cold weather and the water system problems. we're glad y'all made it back to

jackson safe and sound. i have to tell you, this global warming is about to freeze me to death! [applause] know that i genuinely appreciate your warm welcome of marsha. i'm biased, but i promise you, i could never have a stronger, better first lady who loves our state and works hard for it. a little tidbit, phil ratted on me, while marsha is still the beautiful college girl i met in 1968 to me, last week by god's grace she did become a grandmother again for the 4th time. [applause] i had written that to stay she's still a chick to me, and my staff wouldn't stand for it. >> what'd you say? [laughter] >> see, i could have got away

with it. at the beginning of my speech, i want to recognize mayor general bill freeman, our adjutant general. [applause] i recognize bill freeman as a way to honor and prize the men and women of mississippi national guard. today we have nearly 4,000 guardsmen and women in iraq and afghanistan. fighting for our freedom in the war on terror. for many, including our largest guard unit, 155th brigade combat, this is the second tour, for some others even more. marsha and i ask you for your prayers as well as your praise for these soldiers and airmen

and for their families. additionally, i have to tell you our air guard is flying missions to the combat zone every week. and last week a mississippi air national guard c-17 was among the first planes to deliver life-saving, relief supplies into port-au-prince for the people of haiti. [applause] >> remembering how good people were to us after katrina, we continue and will continue to do everything we can to help the people of haiti. and we should all remember them in our prayers too. marsha joins me in thanking you for what speaker mccoy called the best first day of the legislature in the 31 years he's been a member. i'm grateful to the lieutenant governor and speaker and to chairman watson and kirby and

all of the other e leadership for the passing the package to bring schultz, gmbh, to tunica country where the german company will invest $300 million and employ 500 people of manufacturing advance steel products for the energy industry. like general electric and beatsville and atk in tishomingo county, both have just announced expansions, schulz manufacturers made with advance products using advance materials and technologies and processes. of course, this is just what we want more of. because it puts mississippi workers on the front lines of innovative technologies and advance manufacturing. and i want to say to you, i appreciate you for recognizing that during this global recession, when mississippi competes for a project like

schulz, which was sought by about 300 counties nationwide, and mda and our local leaders succeed in the competition, it behooves us all to move quickly and decisively. which you did. and i'm grateful for it. give yourself a hand. [applause] on the same day as schulz, you reviced and reauthorized the workforce enhancement training fund. i congratulate you again and thank chairman watson, straugher and kirby. originally passed in 2005, this so-called wet fund provides more than $20 million a year to our community colleges for workforce development and job training. under a program created by the state workforce investment board and department of employment

security, that features strong accountability and it has produced terrific results. those who have been trained with w.e.t. fund dollars earn $4300 a year more than before their training. some think workforce training is something we do for employers to attract industries and jobs. and that's true. but that's only a small part of it. i believe workforce development and skills training are things we owe our working people. to help them increase their wages and get better benefits. sometimes more skills lead to new, higher-paying jobs. but most of the time, this training is necessary to keep the current job or to get a promotion at the current workplace. and it works. although the 2009 numbers aren't in yet, from 2004 through 2008,

per capita income in mississippi went up 27%. one of the largest increases in the country. and a lot of that came from replacing low-skilled, low-wage jobs with higher-skilled, better-paying jobs. your passage of the w.e.t. fund authorization, reauthorization means we'll be able to keep doing more of that. which lets american eurocopter at columbus at 64 jobs and expand to build every year 60 more light utility helicopters for the army. it complements our shipbuilding academy to help find new workers and upgrade the skills of current workers for our shipbuilders on the coast and for our energy industry. let me just say about our energy industry. it is both growing and critical to mississippi's future.

mississippi power's $2.2 billion kemper county electricity plant will be national pace letting. it will take mississippi coal, convert it to synthetic gas, burn it to generate electricity, and then capture the carbon dioxide and tell it for use in enhance the oil recovery. that gives value to this indigenous, local ignite coal. it prop sides many jobs, it gives mississippi power customer's stable, affordable, base-load electric rates for decades to come. and it'll be the first commercial-scale example of carbon capture and sequestration in the united states. it's a home run for mississippi.

[applause] enterjy has announced $510 million expansion of the facility. it will increase output by 13%, again providing more stable, low cost already base-load power to customers while providing lots of good jobs and generating more taxes. and nuclear, the big, green, clean energy machine, emits no greenhouse gases. south mississippi electric power is in the middle of a $500 million series of upgrades to improve service for our state's rural electric power association members. chevron and pascagoula is completing $700 million dollars

of upgrades that have increased its output of refined gasoline product by 10% while using no more crude oil. next is chevron. gulf lng is approaching completion of it's $1.1 liquefied natural gas terminal in jackson country. it will enfurther -- it will further enhance our state's standing as a reliable energy state. in fact, mississippi is one of the few states in the country where petroleum production has actually gone up during the last several of years. companies like denbury resources and tellus continue to use advance technologies to produce mississippi oil and gas for america.

ergon and bunge's facility of vicksburg supplies 60 million gallons of ethanol a year. and scott petroleum has a fully operatal bio-diesel plant in washington county. there's much more to come. and for important reasons, i will tell you that in the years to come, 10 or 15 years from now, companies when they ask about energy are not going to ask what does it cost. they are going to ask, can we get it? that's why i am proud that you have helped rentech which is to build a $3 million-plus coal-to-liquid fuels plant in natchez. in mid-december, rentech announced an agreement to

prelude to its provision of certified jet fuel made from coal and produce in adams county to 13 domestic international passenger and cargo carriers. also mississippi gasification has been selected for a $1.7 billion guaranteed loan to build a synthetic natural gas plant at moss point. this plant will buy pet coke, a low value bi-product of refining process and convert it in synthetic gas. this will provide a stable price for natural gas. which all of you know have seen it's price extremely volatile in recent years. and it will create a much lower use for our pet coke, keeping the energy in mississippi. enerkem, a canadian company, just received $50 billion federal grant to build a waste

facility. and bluefire ethanol, a company based in california has been awarded $88 million in grants to build a $300 million celluosic in fulton. these are two of only 19 renewable energy products in the entire united states that received grant awards from the u.s. department of energy. [applause] experts confirm that mississippi is a prime focus on the biofuels energy industry because of our large supply of wood products and our proven capacity to grow feedstock crops for cellulosic ethanol and similar fuels. i will tell you, as long as i'm

governor of mississippi, we will have an energy policy. and our policy is more affordable american energy. that's what our country needs. [applause] both improving the skills of our workforce and being a reliable energy state are crucial to job creation in mississippi now and for many years to come. when toyota or general electric talks about why it chose our state, the first thing cited is the quality of the workforce. it's number one. we have to make sure that we have enough high-quality, skill workers who can be trained for the next expansion or the next 10 new industries. our workforce has gained tremendous respect nationally and internationally over the last few years. and it is incumbent upon us to keeper the pipeline filled with

good workers. ready to be trained for job-specific skills. we must never let that pipeline of skilled workers run out or be perceived as running out. i spent the first part of my speech tonight talking about job creation. because mississippi families know job creation is the most important thing needed to help them, their businesses, and our state. more people working means more income for those families who were personally hit by this global recession. it means more revenue for our small and middle-class businesses who are the backbone of our economy, and of the nation's economy too. and here in the state government, job creation means more taxpayers with more taxable income. indeed, most of the difficult budget problems facing us this

session and for another year or two after that, i'm afraid to tell you, directly result from job losses and the recession that led to them. so i hope you think it's appropriate that i would speak to you first about job creation. my top priority. and i believe it should also be the top priority of our job intel. still, we can't be together tonight on this occasion, early in the 2010 legislative session, without focusing on the difficult fiscal challenges that we face together. i emphasize together. because it will be hard enough to resolve our budget dilemma if we do work together. we may not agree on everything. and we don't have to.

we do have to be honest with each other and our constituents about the facts, the situation that we face, and honest about the option that is we have. as i've said many times over the last several weeks, i have felt like the leadership, bicameral and bipartisan, recognizes we have tough choices and are open to new ideas. i appreciate that, and our citizens need it. i want to say, i am committed to working with you. [applause] we all know we must have a balanced budget, and it appears to me that there's no appetize for tax increases. i agree. i don't have any appetize for tax increases. in a recession, when our

businesses and families are hard pressed and their incomes are down, the last thing we should do is further reduce their incomes by raising taxes. [applause] the joint legislative budget committee's budget recommendation called for record savings, and left no sacred cowed untouched. while the cuts were not quite the same as those in my budget recommendation, the committee made plain that in fiscal year 2011, it can't be business as usual with state spending. i applaud the legislative budget committee, and i applaud you that are in this room and those that are not present tonight. and i pledge to work with you and the lbo staff to fashion the

best budget that we can that lives within our means. [applause] of course we don't agree on everything. we shouldn't be expected to when we're talking about $5 million of spending. i strongly believe the state's rainy day fund, the working cash stabilization fund, must last at least three more years. 1/3 of the balance of $78 million, should be appropriated this session for fy 11. i feel that way even more strongly because as you were adviced by state treasureer tate reeves, our annual tobacco payment went down by $10 million compared to last year.

of course, we'll have to adjust that down to show that, and the other reductions in the available revenue. i consider one the worst mistakes that can be made at a time like this would be the excessive use of one-time money. of course, the appropriations for the year we're in right now, fiscal year '10, and those for next year do and will contain huge amounts of federal stimulus money that the following fiscal year will go away. there is one-time money. because it'll evaporate under current federal law. about $150 million of that stimulus money is scheduled to be gone by december 31, and about twice as much or $350 million on june 30 of next year. we have to carefully work around these funds -- using them productively, but knowing and

planning how to budget and spend when these funds are gone. as they will be. these enormous amounts of disappearing federal funds mean fiscal year 2012, the budget you must deal with the next legislative session, the legislative session during the election year, may be even tougher than this one. again, because of all of this i urge you to be prudent and conservative. to err on the side of less spending, lest you make next year even worst. we have some differences in the amount of money we'll have available to appropriate appropriate between my budget and lbr. that was before the $10 million decline in the tobacco payment.

we recommend spending down $35 million from the tobacco trust fund. now for our public viewers, this is separate from the money spend from the annual payment, which we get every year that state treasurer has actually gone down. this $35 million in the legislative budget recommendation would actually be taken from the balance of the existing trust fund. since i've been governor, it has become clear to me that this trust fund -- the health care trust fund, as it's officially known, is not and never will be held in trust in the troupe sense of the word. it'll never build up since the interest or earnings now are not large enough to be material in future budgets. so while i didn't propose it, it's the will of the legislature, i will agree to spending down the balance of the

existing fund, so long as it's done on a schedule of equal payments over a period of at least four years. on the other hand, i don't support the idea of a tax amnesty. first of all, the overwhelming majority of mississippians faithfully pay their taxes every year. those good taxpayers deserve for us to make every effort to collect the taxes that are owed by people or companies that aren't paying like they are supposed to. the state had a tax amnesty in 2004. it produced about $9 million in extra revenue. just back in 2004, i want to suggest to you, if we have a tax amnesty every four or five or six years that is proposed by the lbr, tax cheating will get worse. because some people will fear they can beat the system by not

paying. and they can not get caught before the next tax amnesty. [applause] i don't -- [applause] >> my budget calls for no tax amnesty. but instead for a small increase in the tax commission budget for collecting unpaid taxes owed to the state of mississippi. and that should be produce as much money every year as the tax amnesty would produce just once. let's don't undermine tax compliance or be unfaithful to faithful taxpayers. let's collect the taxes our state is already owed. [applause] there's a proposal in the hurricane disaster reserve fund. this fund is there to pay matching funds that we owe the

federal government for $400 million of hazard mitigation expenses made in south mississippi. for three years, we have tried to get fema to accept in kind payment of the nearly $100 million we owe them. we think that's right. we think we deserve it. but they haven't agreed to give us in kind treatment. so spending any of the existing hurricane disaster reserve for any other purpose than this federal match would be unacceptable. because we have to have this money to pay them the nearly $100 million that we owe them today. when we look at state revenue for the first six months of the year, of the current fiscal year, july through december of

2009, that revenue was 8.1% below the level on which this year's budget was based. since the decline in december, i see no reason to expect any improvement in revenue for fiscal year 2010, the fiscal year we're in right now. if you figure revenue gets no worse this year, but stays at minus 8.1% for the rest of this fiscal year, the shortfall in revenue for the general fund and equivalents will be about $437 million for the entire year. just a fewing months ago, we estimated the shortfall would only be $371 million, but an 8.1% shortfall which is what we had the first six months would be $327 million.

and i'll have to say to you, i fear it may be worse than that. for the budget year you'll pass this session, the budget for fiscal year 2011, that begins july 1, the revenue estimating committee will give you reviced figures in march or so, so you'll have updated information on expected tax collections before you're asked to vote on an fy 11 budget. however, for this fiscal year, 2010, spending or reductions must be made now to get our budget back into balance. by state law the governor is required to make cuts to appropriated spending sufficient to align spending with actual revenue. you may recall that i cut about there 226 million in the state spending last fall.

another $211 million must be cut, based on an 8.1% revenue shortfall. the attorney general has issued an opinion that says only debt service is exempt from the current law that limits the governor's discretion in spending cuts. that law says the governor can cut any department agency or line by up to 5%. but it can't cut any account by more than 5%, until every department and agency has been cut by 5% expect debt service. then the law goes on to say, any cuts above 5% must be the same for every department and agency with no exemption but debt service. i have asked you to change that law to allow the governor the

flexibility to cut departments and agencies by up to 10%. the senate has passed such a bill, though it limits the governor's discretion to just this year ending in sine die, which is fine with me. i want to suggest you're going to want to give the governor the same flexibility next year for the same reasons. but there's no reason to have to deal with that now. because the departments and agencies need to know as soon as possible what size cuts they have to make, i ask and urge the house to please pass the 10% flexibility bill. if not, every department and agency will be cut about 8.1%, including special as well as general funds. as an example of why the 10% bill with flexibility is

critically needed, let me refer you to the corrections budget for our prison system. an 8.1% cut for corrections would equal $26 million. to make such a cut for the rest of this fiscal year would require the corrections department to let 3400 to 4,000 prisoner out of prison. it's your order. this would be 3400 or 4,000 convicts who are not approved for parole, not have gone through any pre-release preparation or training, and for whom there are very, very few jobs in mississippi today. i cannot believe anybody that's watching this speech on

television or hearing it on the radio would vote to turn lose 3400 to 4,000 convicts, to turn them lose on to the public and on the civil society. that is not most glaring reason that the senate bill needs to be passed. further, this 10% bill would allow smaller cuttings in maep and k-12 education than under the current law. because i can use the little discretion that i would have to that end. and experience shows the managers and directors of departments and agencies and schools need to know this week, at the latest, the amounts of their reductions so they can make the changes required to achieve that amount of savings. and it's imperative that

agencies receive lump sum appropriations and be taken from under the state personnel board in order to effectively manage the necessary cuts for the current fiscal year and for fy 11. none of this will be easy. but every day that goes by makes it even more difficult. let me close on this subject by saying current law would not produce an acceptable answer in implementing the required budget cuts to have a balanced budget. but the only choices are, current law, the senate bill, or for the legislature to make the cuts. if the legislatures wants to enact the needed $200-plus million in cuts, that's fine with me. but my experience is that would take a long time when time is what our schools, departments,

and agencies don't have. that's why it seems the only reasonable way forward is the 10% flexibility bill passed by the senate. we have some really difficult budget problems. and it's no fun talking about them in a speech. however, we all know our job is to face the facts and deal with the facts the best way we know how. i have to tell you: i believe next year's budget will be just as hard, if not harder. because of all of the federal stimulus money that will be gone. with all of that said, let me close by telling you despite our budget problems, i'm bullish about what's around the corner for our state. i'm optimistic that soon mississippi will be leading the country out of this recession. this global recession, taught as it is, strikes me as just a

break in the economic momentum our state had until the mid of 2008. it knocked us back, but it didn't knock us down. the fact that state revenue is a lagging economic indicator that recovering more slowly than a real