276 million over the enacted 2010 model. longer term i am pleased that the budget to an increased investment of 6 billion nasa science, aeronautics and enabling technologies over the next five years compared with last year's plan. ..

>> that are critical to enable next generation space light. earth sensing and air -- aeronautics capabilities. they will spur new businesses such as the recently announced partnership between nasa and general me -- motors robot, r2. i want to thank all of the nasa employees and contractor who's have worked so hard on the program. their commitment has brought great value to the our agency and the nation. they will continue to play a pivotal role in nasa's future. many of the things nasa has learned from the constellation

program. as the crew escape vehicle and test vehicle from lower vehicles. however, as the augustine committee continued, if we continue on our current course, we will have to make deeper cuts to the nasa budget. terminating national space station early and reducing aeronautics. the constellation enables us for the 2010 budget that includes demonstration and development program that allow us with our international and commercial partners and other government entities to demonstrate critical technologies, docking, and closed-loop life support systems. heavy r&d activities to support development, test, and ultimately flight of heavy launch vehicle sooner than

projected as assessed by the augustine program. we will decide on the vehicle no later than 2015. robotic submissions to multiple destinations in the solar system, in support of future human exploration, including missions to the moon, mars, and its moons, points and nearby asteroids. significant investments for the development of commercial crew and further cargo capability. in concert with our international partner, extensions of the utilization to 2020 space station and beyond. pursuit of the capabilities led by the newly established office of the chief technologist have game-changing innovations to make space travel more affordable and capable. it will enable nasa to substantially accelerate and expand its earth science capabilities, including a replacement for the orbiting

observatory. aeronautics are in need, green aviation, and safe integration of systems into national air space. education initiatives, including the summer pilot program to inspire middle school students and better equip their teachers were improved classroom performance in courses. we understand that many concerns are being expressed about that budget. but i believe it's the right vision for nasa. i look forward to continued discussion with you and our authorizing about your concerns and how we might solve them. i want to acknowledge to the committee, the committee's concerns that details such as our justification documents were slow in reaching you. i acknowledge -- i apologize and asked for your continued patience as we finalize the details in nasa's direction in historic change. we have turned through inspiration throughout the history.

our work gives people an opportunity to imagine what is barely possible. we at nasa get to turn their dreams into real accomplishments for all human kind. this gives nasa a road map to more historic achievements as it spurs innovations, provides jobs and encouraging people around the world. madame chair, thank you again for your support and that of its subcommittee. you would be pleased to respond to any questions from you or other members. >> thank you very much, administrator bolden. i'm going to ask a few questions. then we'll turn to shelby and bennett and return to the regular order and go straight on down. does that sound like a good way to go? administrator bolden, i have many questions. i actually have 13 pages of questions. and i had wanted my original questions were going to focus, of course, on space science as

well as human exploration, but i think we got to get right to the human explorations aspects. my number one concern, while we have to look at budget, is the safety of the astronauts. many members on this committee has been to launches. but we've also been there be when the challenger went down, the terrible tragedy of the columbia we say a grateful nation will never forget. whatever course of action, we don't want to forget. so my question will be the safety standards. will nasa have -- first of all, how will you ensure the safety of the astronauts in the new proposed program? and will nasa have one safety standards for human in space? not one safety standard for government development programs that are very tough, and another for commercial companies. one commercial company said they could produce a crew vehicle in

three years. well, that sounds promising. it also sounds ambitious. my look at the history books showed that the shuttle took 12 years from when president nixon approved it to the first human test from 1969 to 1981. again, tell me about the safety standards and are we going to have one set of safety standards for both orbit and commercial vehicles and so on because it would be my hope that there is one safety standard? >> madame chair, it's been pointed out already by several speakers, i was a member of the aerospace safety advisory panel that now advises me. when i was a member of that panel, as john frost who will testify after me will comment, we were concerned that nasa was not sharing it's human rating requirements with the commercial vendors. i think, and i hope mr. frost will attest to the fact that

since my becoming the nasa administrator, we share the human rating standards with all of the perfective vendors, whether they are large or small, entrepreneurial or not, we are actually developing a set of human rating requirements for commercial vehicles that will take the massive numbers of engineering requirements and various other requirements and put them in one source document that will be available for all who wish to enter the market. in terms of safety, safety and reliability are very interesting factors. and when we -- when i talk about safety of a vehicle and satisfies myself that a vehicle is safe, there are a number of criteria that have to be met. the number one criteria is demonstrated reliability. i would point that we have three can -- candidate vehicles.

we have never thrown an aries one or falcon 9 or taurus 2. they are equal. they are all zero. i will also point out when we flew the space shuttle, when i came to nasa in 1980, the predicted reare liability and safety factors for the space shuttle was going to be 1 in 1,000. we were going to fly 50 flights a year. most people know -- the maximum we flew, i my we had a banner year in which we flew 9 space shuttle missions, i think. that was an incredible year for us. the demonstrated reliability of the space shuttle today is 1 in 125 or somewhere in that neighborhood. so i would caution anyone to get carried away with predicted safety and predicted reliability numbers. we all know, as we say in the military, no plans survives crossing the line of departure.

i am very comfortable that i can guarantee before i put a human being whether it's government produced or commercially produced, it will meet the safety standards. >> but do i take it to say that there will be one safety standard. >> there will be one safety standard for any vehicle that carries human beings from this planet to anywhere. >> well, thank you for that. i would like to ask a contract termination question. because if you're -- if this is what you want -- if this is what the president is proposing, how do you intend to handle contract termination, the work force dislocation, but for us and i know others will be asking questions about safety, -- >> excuse me. >> but what is your plan for the contractors who will be forced to terminate your work if this

proposal is accepted? and are you planning to terminate all constellation contracts? i mean the issue saving technology is one thing. but this has tremendous implications for our budget. >> madame chair, we're in the process of transitions the constellation program to where i inherited to where it's going to be. the term termination liability is one that has caused a lot of angst recently. because it is a term that used in procurement. it is a factor in all of nasa contracts. every nasa contract has a stipulation that the contractor should provide for termination expenses. and every contractor knows that. to we are not changing requirements. we are not modifying requirements. those having existed in prior nasa contracts and they exist in our contracts today. >> i'm puzzled by this. how do you square -- you're been

reminding contractors of their obligation to have reserve funds. how does that square with the fiscal 2010 appropriations law that prevents you from terminating or restructuring contracts for this fiscal year? >> i cannot terminate or anything that has to do with the constellation program and we are doing that. we are -- if i can make one minor correction we are not informing contractors that industry to maintain reserve funds. we are reminding them it is their responsibility to look at and to determine, i guess technically, what level of risk the company is willing to accept as of being able to handle a determination. we are not telling them to reserve funds. we are telling them that termination liabilities, some of them lie on them by their contract. it's the companies determination of what level of risk they want

to occur. when they put aside funds or assume that they are not going to need them. >> i want to ask more about this. >> yes, ma'am. >> i do want to make sure other members have a chance. senator bennett. i have a great deal of questions about this. >> thank you very much, ma dame chairman. i appreciate your courtesy of allows me to participate in this. general bolden, i'm a businessman. >> yes, sir. >> if i were sitting on the board of directors and you were making this pitch to the board of directors has to the direction in which you are going to take the company, i would tell you haven't made the sale. let me give you four areas where i think you have failed to make the sale. by the way, madame chairman, i have a formal statement, i would appreciate it put in the record. [inaudible response] >> the four areas are number one the science, number two, the protecting the industrial base,

number three, the money; and number four, the law. let me run through those very quickly and then you can respond to them as you will. you made a statement just now that i find incredible. when you say the demonstrated reliability of aries is zero. now you probably have seen this. but let me show it to you. "time" magazine just six months ago in november of 2009 published the 50 best inventions of the year. and number one of the 50 is aries. the best invention of the year. doesn't sound like shabby science. they say you can contradict this, they talk about this from time to time, in 2004, the u.s. committed itself to sending

astronauts back to the moon and later to mars. you need something new for them to fly. the answer is aries one who had its first unmanned flight and dazzled even the skeptics. that doesn't sound like there's no demonstration of reliability. i think there's a definition problem. none of other things you talked about can match the tested perfection of earless with the test that has already been done. so i challenge that one. number two, the industrial base. you said the president will make a decision as to what will be done by 2015. if you kill the industrial base of solid rocket motors now with this action, in 2015, you cannot get it back. this is not like -- this is not saying, well, we're going to stop buying this kind of car and we'll look at buys another kind of car or pickup truck or suv

four or five years from now and there is an industrial base that will have them. this is the only game in town. and you shut down the industrial base rockets, solid rocket motors and there will be no contractors available in 2015 if you make the decision that's the way you'd want to go. and i think that is a very significant issue that you need to address. now, money. number three. you have not made the case that this is going to save money. and let me point out particularly two things. with respect to money. on the -- senator shelby has referred to this already. the fiscal 11 budgets includes $2.5 billion in constellation contract termination cost. and new commercials provide when

we don't really know who they are. the cost and schedule growth has been referred to in the opening statements already with their level of inexperience. an additional $312 million for money that was never planned. so you got the $2.5 billion, you got the uncertainty of where you are going, and it seems to me a much more responsibility use of taxpayer dollars be to use the combined $8.8 billion that is represented in your budget to finish the program that has had five years worth of progress and accomplishments. and it is designed to deliver a safer and more reliable way to send our astronauts to orbit than something that we are just guessing about. i think the prudent financial circumstances is to stay with what we've got instead of plunging into the unknown. and looking at -- looking at

construction cost, i'd like you to address what i find a significant gap in your money calculations. you stated in congressional testimony that the aries would cost $4 billion a year to fly. doug cook, the administrator for systems and admissions recently stated to the occurring cost is $140 million per flight. you got to have a lot of flights at $140 million to get to the $4 billion per year. i find that a disturbing kind of thing that i think you need to explain. finally, the law. this committee, congress, and the fiscal 2010 omnibus appropriation bill prohibited using 2010 funds to terminate or any way change or modify the constellation program. just yesterday atk received a

notice that funds for their contract under the launch aboard system will be limited and no additional funds will be forthcoming after april 30th, 2010. that's a week away. it seems to me this is a clear violation of the law that says no money will be use -- no funds will be used in any way to change or modify the program. and for fiscal 2010. fiscal 2010 has not run out yet. to summarize what i said in the beginning, i think your conclusion on science runed a foul of the experience of what we have found with the testing of aries whereby i think the threat to the industrial base cast doubt upon your ability to do something in 2015 if the president decides or whatever president it is decides they want to go back to solid rocket motors, they won't be able to.

i think your numbers on the money don't add up. and i think what is being done right now is counterindividual of the law. so i'd very much appreciation your reaction to those four points. >> thank you, senator. i'll try to go down the line. the first thing is the science. with all do respect we are very proud of having been recognized for number one invention of the year by a number of different authoritative publications in the like. perhaps we were not very good in explaining to people that aries 1x is not aries. aries 1x is a four segmented rocket that had a dummy fifth stage and dummy interstage and dummy nose cap. the aries 1 vehicle is a five segmented solid rocket motor that has never flown. we are very proud of aries 1, -- 1x, and its recognition, because

it gave us seven pieces of data from sensors that were put on. it was greatest wind tunnel test. that was not an aries 1, it was an aries 1x that we wanted to do that the shape and form would work. so the science does -- >> in the interest of time we're not going to have a debate. if you could also, we'd appreciate the extensive data. if you could answer the question because there are several other members. i'd like to keep a well-paced hearing. >> the money -- there's a big difference between the per flight and recurring. most would come from maintaining the infrastructure. that's the reason that the money difference is. the law we have not terminated any contracts, we not directed anyone to stop work on anything. and if you were talking about

the launch abort system test, that is still scheduled for may, i may be misunderstanding your comment, but the launch test is still scheduled for i think may 5th, we're looking forward to seeing that. we'll get a lot of data from that test. the industrial base, unfortunately, the solid rocket industry has been over capitalized for many, many years. it was far over capitalized for shuttle. because we said we were going to fly 100 missions a year, or 50. that's what it set up to service. we ended up flying eight missions. it was over capitalized for shuttle. it would have been grossly over capitalized for constellation. so the business decision, since you're the business answer. the business decision that needs to be made by the only company that's legitimately in that industry right now is how do i downsize. there's a big difference between what nasa uses in solid rocket motors.

we use large solid rocket motors. since the cancellation of the titan program, there's no kind of use. so we are carrying 70% of the industry for a capability that nobody uses but nasa. i am concerned about the industrial base. and we're doing everything we can to work with the counterparts in dod and to work with adk and work with them. we still need solid rocket motors. >> administrate tour, we need sorter. >> those are the four questions. >> i need good answers -- >> yes, sir. but i'm done. >> no, he asked about the law. >> i said, ma'am, we have not violated the act and the stipulations. i have not terminated any contracts nor directed people not to go forward with, you know, to my knowledge. >> senator bennett, i know you had many more questions. i must turn to other members. i want to ask the administrator

and also invite my colleagues to submit other questions in writing to leave them open for the record so that there be an extensive record of these deliberations. and proceed. is that satisfactory? >> absolutely. >> absolutely, madame chair, i very much appreciate your courtesy. i apologize letting my enthusiasm and desire to engage get a hold of me. >> no. we got to -- we got a lot of people that want to talk and ask questions. let's turn to senator shelby, the ranking member. >> thank you, madame chair. madame chairman, i have two articles. one appeared in the tuesday's "golden mail" in toronto, regarding the space program. and one appeared in "florida today" i'd like to ask that that'd be made part of the record. >> without objection. >> i would like to quote just a

little from "global in mail" about the obama plan from tuesday. this plan basically they say, and i'll paraphrase, barack obama has lowered the ambitious of america. space is not the final frontier. earth is. that's part of the article. under the "florida today" article that appeared april 16. it says obama doesn't get it. space is last frontier. president obama pulled the plug on our space program here in thursday. although he masked it with some vague long-term suggestions. the late president john k. kennedy must have turned over. he turn -- launched the moon landing program, because he understood that any nation that wants to remain number one on

earth must also be number one in space. a couple of questions. it's my understanding, mr. administrator, that there's been a lot of internal administration on how to circumvent that includes nasa's ability to terminate or alter the constellation program. given the important of this issue, we need to understand the legality of the decisions nasa is making, relating to the program of records. especially in view of legislation. would you provide to this committee, the appropriations committee within the next week a letter and a decision documents from nasa's general council regarding nasa's interpretation of the 2010 appropriations language and the applicability? >> yes, sir.

>> nasa, what's their legal opinion? >> sir, i would submit that in record. in summary, it had to do the potential termination liability as the chairman, madame chair was talking about. >> thank you. i want to get into the aries 1 versus the falcon 9. general bolden, it's any understanding that you have stated to congressional members that you think aries and orr yen are no safer. however, according to the july 2009 independent safety review of rockets options initiated by nasa, the report states that aries 1 launch vehicle quote, is clearly the safest launch vehicle option. and that it is superior to all other options. what information do you have that validated the safety of the falcon 9. and if you have it, would you furnish it for the committee?

>> sir, we will get what information we have. but my comment to people over the last week has been that specifically when asked by senator hatch earlier, my cut said aries would be safer than anything else. but that's not what the data says. >> but you will furnish this? >> i will furnish the data, yes. >> the latest is the capsule that will be nothing more than a space station escape pod. i fail to see how it will lessen our reliance for access to space. we're still going to pay the russians for a round trip. we're going to pay for commercial rockets and capsule and pay to build our own return vehicle. explain this to me. >> through the restructuring of the program, it's my desire that it be an approach to develop a

vehicle that will one day take us to the moon and mars. we need to have a capability to get crews back and forth to the international space nation. the original version that the president talked about last week would be a vehicle that we could get there much quicker than anyone else. because we don't have to human rate it for asset. we would send it to space just on any launch vehicle. but it would be rated to comply and rated for human rating for entry and landing. >> general bolden, if commercial is truly the route that you are headed, wouldn't it be cheaper and wiser to use a dragon capsule? >> senator, we hope it would be cheaper and wiser. that is our long-range intent. the first -- the first use of the arrayian is because we think

we can get it used for three years. it also relieves some of the pressure to try to deliver a vehicle that has the human-rated capability in a shorter period of time. >> general, you're a four time veteran of space flights, as aastronaut, each time you arrive safely home. thank god. you've also been a member of the advisory panel, a group that was founded to ensure the safety. of all of the people to lead nasa on its mission, you are more than qualified to understood the role of safety. now you have appear to be the deliberately choosing to ignore from the very people at nasa that you entrusted your life with and you came home four times. could you explain to the committee and people at nasa who

made the united states such a leader in space for 50 years why you as the administrator are ignoring their record of safety and engineering excellence. >> are you referring to the asap? >> i'm talking about overall safety. >> i am not ignoring the inputs from anyone. >> they believe you are. >> if you ask brian o'connor, he was any director of safety and mission, brian will tell you that i listen to him every day. john frost is going to come up. i think john frost will tell you that i listen to him every day. we are increment -- we are decidedly looking at everyone's concerns on safety. that's why i can ensure anybody that before we put a human in vehicle and launch them off of the planet, we are going to have the safest vehicle. i am a safety professional. it is my life. it is no nasa's core values, and there are not a lot of companies

that can say safety is one of the core values. >> you benefited from it four times. >> i flew four time. of i had every confidence in the world that i was going to return. that's going to be the case where everies -- with every other astronaut where privately or government tally. >> that's all. >> senator cochran. >> madame chairman, thank you for your leadership in this committee. mr. administrator, we appreciate your cooperation with the committee. i remember our visit in my office when you were making the rounds of the hill after assuming the position that you know have. and i was very impressed with your commitment to moving forward in the space exploration program and got the impression that that also includes a robust

testing program. we're very proud of the fact that in any state, the space center provides testing payments and experience to help make sure that we do have demonstrated reliability which were your words to describe your test for nasa's safety standards. do you continue to have the view that a robust testing program is essential to a reliable and safe and successful space exploration program. >> senator, i continue to hold that -- there is nothing better than a robust testing program. and the $312 million that the president has proposed in the 2011 budget for commercial will allow us to vie down some risk by helping the commercial industries to do some more test that they may have planned in their present portfolio. i am a believer in test. >> i was worried that the budget

request doesn't have any funds that specifically designated for the testing programs at the space center. >> senator, the heavy left propulsion development program is significantly -- it will contain test that will be run at the space center. i think as you know we are continuing the retrofits to the a3 test stand. we already have commercial entities that have contracted to test their engines. it's commit call and vital to the future of any kind of space flight. because we want it to be the center for testing of propulsion systems whether they be for the military, commercial or nasa. >> that's reassuring. i appreciate the clarification of that. i also want to let you know that we appreciate the comments that your 100% committed to the mission of nasa and its future,

broadening our capabilities in space. we'll continue to serve our society in ways we can scarily imagine. i share that enthusiasm and commit to you our best efforts here in this committee to identify how we can invest the public funds so that we achieve those goals. >> thank you, sir. >> thank you. >> senator voinovich. >> thank you, ma -- madame chairman. first of all, i'd like to say nasa in my state and plum brook station are unique and powerful resource for our state. more than 3500 highly skilled civil service and contractor employees work at these facilities. and your agency economic impact to the state exceeds $1.2 billion. further it's a catalyst for 1200 aerospace companies that employ

iowans. the undertoe and a lot of the comments that you are getting today is nasa has been very, very helpful to our respective states. and the constellation program has been very important to nasa glen. on the other hand, last year, for every dollar that country spent we borrowed 41 cents. our debt is out of control. it's not sustainable. as far as we look down the road, we have budgets that are not balanced. and we have to come to some point that we start to analyze what we are doing. i think that it's important that you do a better job of clarifying what you are trying to get done. are you trying to get a rocket made quick to go up to the space station and you think you can do

it better we having competition from the private sector? are you intending to go to mars and rest of it as president bush talked about? and if you are, how far out is it and what do we have to do in order to reach it? i think that you have to do a better job of clarifying things. >> yes, sir. >> and the question that i want to ask you is -- the thing that you have laid out in your budget represents a fundamental shift in the direction and fundamental shift in the relationship that nasa has with commercial companies. what was it about the way that the agency has been doing business that lead the agency to believe it's needed to undertake such a dramatic overhaul in the way of doing business? is it because of the budget? is it because you think you can get their quicker by going the route that you are going? or is it a combination thereof?

>> senator, it's -- i guess if i can summarize it, the number one thing is we're trying to meet the expectations of the congress and the nation that go back to the 2008 space act that put a primary challenge to nasa to help develop a commercial industry. we see that commercial space industry as allowing nasa to focus on exploration beyond the orbit while the industry provides access to the orbit. so it's a combination of things. but we are not trying to do anything fast. it's always been said, i've heard it said if you want it quick and fast, you'll get it quick and fast. and it probably won't be very good. so speed, urgency is important. speed is not something that i'm asking my people to do any of this. but i do want them to try to get us where we want to go with a

sense of urgency. >> well, there's a lot of feeling in the country that we have to rely upon the russians to get up to the space station. more countries should be paying for that. how can we get others to pick up the tab? we're not uncle sugar anymore. we're in a different position. we're probably worse off than some of our partners. in fact, how much are they going to charge? how long is it going to last? that has something to do with how people feel about where we are going. >> yes, sir. senator, that will require a fundamental change in the way nasa has operated the space station. from day one, the russians will provide assess. nasa because we had the large cargo vehicle, would provide the vehicle to carry cargo. this is not knew that we rely on

the russians to get humans to the international space station and back. that has always been a basic fundamental agreement in the partnership. that's not new. the other fundamental change is that this president through its budget has decided that he must and we must build a sustainable program. the way we were operating up until now was not sustainable. that was my gut feel as an outside observer after leaveing before and coming back now. we are now going to have a sustainable program. you're going to have to do a big job with this committee about it's not being sustainable. >> yes, sir. >> and what you are doing with the money, we're going to make available to you and many of us are interested in the whether or not the money that we have put is going to be poured down the drain or whether or not it's going to be able to stay in the

game in terms of competition to go forward. >> yes, sir. we intend to do that. >> senator voinovich, are you known >> yes, ma'am. >> senator hutchinson. >> thank you, ma dame chairman. i do appreciate your holding this hearing. and i would say that as a ranking member of the commerce committee, i have invited the administrator to come to a hearing next week where others have been invited but have been told that the administrator is not available. and i hope that madame chairman, that changes. general bolden, because i think after the incredible consequences of the president's decision that i would ask you to

be able. >> senator, may i acquire the time and date? >> april 28 at what time? 2:30? >> perhaps the administrator bolden staff could check it while we are engaging. >> i think there maybe some confusions or lack of communications. it was my understanding that we had moved the hearing to the 12th of may and i was going to be there. because i'm scheduled to be the johnson space center on the day of the hearing that you originally scheduled. but we'll resolve the issue. >> thank you. general bolden, i read your testimony. i've heard your testimony. i've heard the president's speech. and it just doesn't all come together. and i will say that i was one who was very supportive of your

nominations of reasons other have stated, i knew you would be committed to nasa and would understand it and be a great leader. but i am concerned about a very mixed message. the president says that he's committed to science. you don't see how you can have a commitment to science but not a commitment to having humans in space. at the same time. because the space station is right now one the key areas of science. there are others, the hubble which i support completely. by the space station is the future. congress and the president have embraced extending the space station until 2020. but we have not assured that we can get people there. and i know you said that isn't a change that the russians were tasked with putting people in

the space station. but it was always envisioned in any estimation that american shuttles would be going to the space station. for one thing, you have to make sure that you have the equipment. the second thing is you need to make sure if there are repairs or something that you might need in the future that you have the maximum capability. we were never going to have a gap in the beginning. now the gap started coming, of course, because frankly i think nasa has been starved through several administrations. so i think that you are going to have to work with us, i hope, in a constructive way toward keeping people in space and keeping american control over

our own destiny. the emphasis to the tune of $6 billion into a very fledgling commercial capability, i just think is not sound and it's certainly not going to be reliable. they are very short. i mean, it was even said that you have all of the expenses of closing down a contract. but then we're going to have to have are new contracts. so let me just say that i am skeptical and very disappointed that we would have a goal of keeping science in the forefront but no plan to keep people involved in that effort. under american control and under the control of nasa. i think we are too heavy relying in the president's plan on commercial capabilities which we

had a hearing in commerce committee. we had the leaders of the commercial, the two commercial space operations. there in my opinion, i tended the hearing. not ready for this kind of reliance and i don't think we can take that kind of chance. so let me just ask you the questions that i can. if the russian saw you -- has an accident or something happens that the crew return vehicle isn't operable, what if you had the accident and it grounded the use for an extended period of time and we don't have our own reliable efforts or i would ask you how long would it take before the six-person crew that would still be abored the

international space station at certain points would have to evacuate using two of the used vehicles that just experienced a critical failure, assuming the failure occurred on descent? what are your plans here? >> senator, aisle going -- i'm going to try to understand the scenario. if that takes place between now and 2015 with the existing program of record, after shuttle is retired in september or whenever we fly our last mission we have no way to get americans or anyone else to the station. we have two vehicles on station. we would be able to get the six person crew home but that would terminate all use of the station. the constellation program was not going to provide that capability. the gap that referred to began in 2004, probably began before

then. when the vision was given and then not fund, the gap began to materialize and grow and grow and grow. as senator voinovich mentioned one of my primary drivers and recommended what i did, i could not responsibility ask him to put the nation into even more debt by putting the amount of money into constellation that would have required for us to try to catch it up and in fact we still would not have been able to gain that gap. money can do a lot of things. it would not have been able to close the gap. we were looking at 2015 before we would have a domestic nasa built with industry and capability to get humans to space. >> well, general bolden, the starving of nasa started before 2004. >> yes, ma'am. i agree. i agree. >> it's been starved for over 20

years. and so we don't need to place the blame so much as we need to address the issue. >> yes, ma'am. i agree. i am concerned first of all. i think we need to go forward with the constellation or the next generation. if skipping from ares 1 to 1x, i'm not committed to the constellation. but i am committed to the constellation mission, which is people to and from the space station. and with all due respect, i think we ought to be looking at not adding to the number of shuttles but delaying the time frame. that would bridge a gap and it can be gone if all of us work together without an additional

budget over and above it is reworking the budget that the president has said is the budget. if we had over two or three years the same number of space shuttles so that you have the ability to assess and use this in between to take people too and from, i think that would be much more innovated and it will give us much more of the filling in of the gap for the emergencies or for the scientific capabilities at the same time that we are developing our own constellation type operation. so i hope that we can work on something that would not say we're going to be closed down in september and 2015 would be the first time. in fact, in your own testimony, you said that we would be able, under the president's plan which you're supporting, to put humans

into space early in the next decade. i'm assuming since this was 2010, you're talking about 2020. that's early in the next decade. >> perhaps i didn't make myself clear. under the president's budget and his vision, we will have humans going beyond earth orbit in 2020 or very shortly after that. i have just selected a class of astronauts in the past year who were brought on strictly to occupy and operate the international space station. so in terms of -- in reference to your concern about science, we now have the capability with a fully occupied international space station to do incredible science and thanks to the president, recommending that we and funding providing the funds to extend the international space station to 2020 and beyond, we know now we are going to have 10 more years. >> i know my time is up.

let me finish with the last question. that is the we have an accident and we can't get there for two years or three of how can the station survive? how is that possible? >> ma'am, the international space station use will as i said, in the scenario that you mention in today's environment with the program of records, unfortunately because we allowed this gap to grow, there is no way to do what you and i both want to do. we will be -- we are -- we will be single string once the shuttle stops flying. we will be just like we were after the columbia accident for a couple of years. >> i think we need to fix it. a couple of years will be okay. five, seven is not okay. i hope all of the senators will work with you and with the administration. i think we can do better than this. >> thank you very much. >> thank you, senator

hutchinson. there are many more questions. it is now 11:30. we anticipate a vote soon and we want to hear from mr. frost. so the ambassador, -- ambassador, you are in treaty negotiations. [laughter] >> and you -- well, what we will have will be a whole series of orr questions we'll submit to you and for our team for our record. the -- i will have a particular set of questions related to space science. and particularly also to green science. we are heartened by the fact that the president did provide reliable, undenial, survivable, $5 billion in the science of appropriations request. but we just don't want to be spending money.

we also want to be able to get results for our science. i'm so proud of the proud of the work that the done as godert. you can't be the kind of space station through the institutions at hob -- hopkins without being very proud of what we do in science. it's what the world relies on us to be able to do. we want to make sure we have money in the appropriations but that we also have the outcomes we seek. so we'll move with that. so we will excuse you today. we look forward, honestly, there must be more conversations on this around our mission, around our workers, and the industrial-based and look forward to further conversation with you. >> thank you very much. >> thank you very much. appreciate it. >> thank you. >> the chair, thank you administrator bolden.

the chair now calls mr. john c. frost who is a member of the nasa aerospace safety advisory panel. we comes with a distinguished background in safety, serving on dod as well as his work in nasa. and rather than going through a long bio i'm going to put your bio in the record so that really you come with extensive experience, outstanding credentials and a real commitment to both safety and knowing what government needs to do when government asks people to do it that we keep them safe. why don't we get back to your testimony. we appreciate that. >> thank you, it's a good time ahead. good morning to you and ranking member and to the rest of the committee. i do appreciate the community to approach the panel and explain

our views on these issues. i'm very comforted to see that you obviously have read what we have written and already are very tuned into our concerns. our chairman could not be with us today. it was created by congress in 1968 to provide independent safety assessments and recommendation to nasa after the tragic apollo one that took the live was our astronauts. we also advised congress on the challenges and performance. we issues recommendation to the nasa and publish an annual report. our role here maybe somewhat unique. because as we say in alabama we don't have a dog in this fight. maybe we can bring the view to the table. before we began, i want to express the heartfelt accommodation that is shared by every member.

that accommodation is the quality of the leadership and the commitment to safety that has long been demonstrated by administrator. when it comes to the safety of our astronauts, i can think of no better hands. now under the key 2009 findings. first the life of the space shuttle is nearing its end. in view of the hazards, the age of the critical subsystems that it contained and the need to recertify, the panel believes the life of the space shuttle foul not be extended. to do so would require substantial efforts even after which the vehicle could not be considered safe by modern standards. second, i'll address the following under the shuttle. which is really the subject today, i think. after detailed evaluations we have found that because of the fundamental vehicle architecture choices made at its concept stage, the use of the heritage

base subsystems with proven track records and the intense involvement of the experienced nasa safety design professionals, the ares 1 offers the basis for a high degree of safety. the fact that there's designed to groove the tenfold of -- improve the tenfold of the safety. in our opinion, such safety cannot be taken as a given. impossible alternative launchers, as some would like to be the case. as we have already been quoted a couple of times today from our 2009 report we believe to abandon ares 1 as a baseline vehicle for any alternative without demonstrating capability nor proven superiority or unequivalence is probably unwise and cost effectively. we are aware that they provide safe and low cost access. we look forward to their innovations. we do support their work.

we must point out that nasa has not established the safety requirements are. they cannot be required until the safety the proposed designs are evaluated against them. our bottom line safety recommendation is to not abandon the progress already made before determining if the alternatives can provide equal or better safety for our astronauts. they map the skills and funding streams to move to the funding of the ares. if the workers is the path that's chosen, it's imperative that new plan be developed quickly to show these workers the space in the new vision. other than we face a risk of loss to the key personnel that

essential to safe space flight. finally, i must report to you that we are seeing examples of facility which concern us across nasa. : >> both theresources and the mission must be kept stable. asking nasa to attempt too much

too fast with too little can only lead to danger and to disappointment. i'll be happy to answer any questions that you were the other members may have. >> i am going to turn to senator shelby to ask his questions. he has many duties also related to the financial. >> thank you. mr. frost, welcome to the committee. we are glad to have you here. more than that we appreciate your background and your statement. the future of human spaceflight is being proposed to be given to companies that have never launched humans before. that is disturbing to me because your own panel four years has advised me that they are not ready if there is substantial risk in relying on unproven commercial providers to put our astronauts in orbit to you have a suggestion on how to reduce

that risk? >> quoted as saying if it is a horse race, bet on the field. you can pick the winner a little later. so keeping redundant capabilities and not being single string defended can greatly reduce that risk. there is a cost to that. >> a big cost. >> that's right. >> do you believe that nasa should relinquish its role in insuring safety through rigorous testing during development and production if nasa were to allow the astronauts to fly on any spacecraft commercial or otherwise? >> at the current time were nasa to put its employees, its astronauts on board something as potentially hazardous as a

rocketship they're going to have to have a robust program to check its safety. there may come a day when it becomes as routine as a commercial airline. that day is far away my personal opinion. >> thank you. >> first of all, mr. frost, i would like to thank you for the service that you have done through the asap committee and also please thank the other people who participate. but put a lot of time into this. we have read your report. we also note that there is a irregularity to the actual we've intellectual exercise reading memos or mathematical simulation. we take to heart all of your comments, including the degradation of the nasa facilities and your caution

about maintaining morale and competency among the work force. let's get right to this whole issue of going to commercial. there is inherent tension here between baldness and innovation. technology moves fast in its development, is faster than government contracts and procurement. at the same time we are not sending cases of tang into space. we are sending our astronauts and the astronauts from other countries. they rely on us. so here goes the question. on page three of your testimony you say we have not evaluated the proposals and cannot comment on their eventual safety. here is the key point. however, we must point out that nasa has not yet established in the safety requirements for their commercial providers.

now, as you recall in my questions to general bolden i state, is there going to be a single standard. he told me yes. then he told me that they had this manual that you either developed or are in the process of completing. i am confused. is there a standard? is there a manual? could you share with us your comments on this? >> yes. we will be happy to. my understanding is, and we have been briefed and evaluated on this very carefully. nasa does have a human rating. it was recently updated in 2008. it specifically did not address and exempted commercial providers. it was aimed at the type of program where nasa managers the hardware. that is critical because the way you state and explain and tractor the safety ety requirems

depends on the kind of program is. if you are buying a taxi ride you have a different set of requirements than if you were developing a taxi. so that was exempted. the asap made that a prior recommendation for, i think, about two years. that section of the standard be built out so that people trying to develop commercial vehicles knew what to aim for. general bolden has taken the initiative to make that a priority. the current estimate is that some type of standard for those commercial providers will be available by the end of 2010. >> so if, in fact, we say to these bold innovative companies that we are now betting the future of our astronauts going to the space station or in low orbit we are going to have, there is going to be a safety standard, but we won't have it complete until 2010? >> that is the current estimate

would be that is correct. i might point out that is the hardware requirements. then we need a set of processes that will take longer. those processes depend on how much knowledge we have of the provider. if we don't have much inside as to how they develop their rocketship, if you go, then we will need very extensive testing and verification. that process will take longer in my opinion in 2010. >> so then there is the processes. now, there is the hope that i n -- that they will be ready to go in three years. that is all part of the glitz and the glory that we are hearing about that they're going to be ready to go in three years when i'm working with the development of the shuttle we have followed the development of the shuttle together. senator shelby and i came to the congress and have worked together since we came. the shuttle had problems. remember, the shuttle was going

to go 100 flights. it was going to be, you know, like the greyhound bus to wherever we wanted to go. now what i am saying, though, is if, in fact, the safety manual was not done until 2010 and the processes that are really mandatory, usual, and customary, how could a commercial vehicle just getting what they need to know and the standards be able to meet at three year timeframe? the you think that is realistic? >> i am not privy to the development schedule of the folks. that sounds highly optimistic to me. >> i am not trying to pin you down. and trying to get your experience. >> my experience would be that would be a tough schedule to meet. one safety concern that drives our panel is that they are designing parts of those vehicles today. there are engineers at table picking safety factors and design features that may or may not comply with the requirements that will be developed later in

the year, in which case you will either have to accept the risk or step back and redesign. both involve risk. >> they are designing today without having the firmness and the definite nature of nasa standards. >> that is correct. they are attempting to design to what they think the standards will be. if they are right in me will be in good shape. if they are wrong we will have difficulty. >> okay. next question. senator hutchinson presented a really doomsday scenario. when she said it i said, oh, my gosh. she is so right. when it comes to the space program we have really been a bipartisan group. for those of us to meet with the

astronauts, we feel like we are all in this together. when senator hutchison said she is concerned about bringing them back home if something happens to soyuz, bolden says it would be the end of the space station. yeah. it is also the end of those astronauts that are up there. what do you think? you talked about it in your testimony. you say and the shuttle. hutchinson presents this very troubling scenario. is their a way we can have it both ways which is to have a shuttle on reserve erve for res, keep flying it for a specific mission but have it? in other words is she on to something that we should explore? in your oral and written remarks you say it is time to say goodbye to the shuttle.

every scientist and engineer, etc. and nasa administrator has said the san. could you tell us what you think about extending the life of the shuttle and why would it be possible or is it really would be, what would be your observation? >> of >> i'll be happy to. first to the premise she is absolutely on to something of a nightmare scenario. being single-string dependent having humans in orbit and only one elevator to get there subject to a catastrophic failure in which case it can be shut down as we have seen is definitely a high risk. at think it needs to be thought of. there are several solutions. minimizing the gap, in my view, is the best approach. you could keep flying the shuttle. there is no question. we see -- it won't wear out in july.

it is getting old. principally it has a very high level of risk. each launch is something like one and 78. the more times you fly the more likely that you are going to find that result. >> in other words just to be sure the risk analysis, after a certain date the longer you keep the shuttle flying the more increased the risk to the astronauts. >> right. we don't see an increase per flight. as you do more flights it is like playing russian roulette. the more time s you pull that trigger the more likely. >> i think we get there. >> we don't see this show wearing out immediately. it's simply that there is greater risk involved. the nation could accept that risk. the astronauts, i'm sure, are willing to live with it. that is a very high level of risk. >> but we all have these kind

of, the way we think the world works like the movies are now like video games. could you literally take a shuttle and put it aside and keep it prepped and ready to go if they would have to be a very daring rescue mission? >> i think the movie was space cowboys. great movie. in safety there is a concept called up tempo. that is if you fly to many nations to frequently it becomes an safe. oppressing a cruise to hard. but on the other side of that is if you fly to rarely they lose their skills, their heads, their abilities. they don't remember. safety degrades greatly. that curve is generally a bell shaped curve. if you put the shuttle in storage and did not use it, i would have a great concern about the reliability of that launch as it came out of cold storage.

>> i appreciate that. this is my final question. will the asap committee be involved in assessing the safety issues of these commercial enterprises? >> yes. we have made that a central focus of our committee. we are not staffed to do a technical evaluation, an independent review of the hardware. we will look at the processes that will be used to do that. >> well, i think these were excellent. senator shelby, do you have -- mr. frost, first of all i would like to thank you for your answers here. i think they were very instructive to us. we will go forward possibly as this process of evaluation goes on to come back to you and other members of the committee. again, thank you for your

excellent testimony. we would also we will come from the committee this issue of center infrastructure degradation. no matter what we do we have to make sure that they are fit for duty. thank you very much. this committee will excuse you. we would ask you and your committee to be available for ongoing conversation. >> we will be happy to do that. >> senator shelby. >> madam chairman, i just want to thank mr. frost for his incisive answers in his background and experience a safety. thank you. >> thank you. >> i also want to note that for nasa's 2011 budget it affects many states. i know that there is an interest in other centers with this topic. there will be follow-up questions that are both

budgetary, programmatic, mission focused and how we can do this within this budget. >> madam chairman, i hope we could reserve the right to hold another hearing on this matter. >> i absolutely agree that we will hold another hearing to be able to pursue any topics. i would suggest now that our able staff connect with nasa, really sit through this rather content rich -- the content rich nature of what we have listened to. i would also like to thank all of the members who participated for their civility and for their very insightful questions. i believe that if we all focus on where we want america to be in space and how we protect americans we will be able to find solutions to how we go through these complex challenges. again, mr. frost, thank you. if there are no further questions this morning senators

may submit additional questions for the subcommittees official record. we are going to ask nasa's response within 30 days. the subcommittee stands in recess until thursday, april 29th at 10:00 a.m. when we will take the testimony of attorney general eric holder. the committee stands in recess. thank you. [inaudible conversations] >> i think there is a huge lack of knowledge about how this town works, how congress works. >> when you are doing the actual research work you just have to do that yourself. >> this weekend award-winning historians richard norton smith

and douglas brinkley will talk about their work, their books, and their profession and revisit their first appearances on our network. q&a sunday night on c-span. >> all this month see the winners of c-span student cam video documentary competition. middle and high school students from 45 states submitted invidious on one of the country's greatest strengths or challenges the country is facing. watch the top winning videos every morning on c-span at 6:50 eastern this before washington journal. at 8:30 during the program meet the students who made them. for a preview of of the winner's visit studentcam.org. >> on thursday's washington journal we talk to "usa today" reporter about the growing number of unaffiliated voters and their political influence. this is 40 minutes. >> host: meet richard wolf, our final guest. he is a white house reporter for

usa today. this week he filed a story with this headline, "frustrated voters cut ties with democrats and republicans." the nation's fastest-growing political party is none of the above, which could be bad news for democrats and republicans. you and i both in washington politics for a while. the unaffiliated voters has been on the rise for quite a while. what is different? >> guest: in a sense nothing is different except for the trend is continuing. we have had this trend, not for about 20 years or more, back to the end of the reagan administration. we chose to, "usa today", look at the latest statistics. we wanted to see to what degree it was continuing. we compared four years ago, although that was during the presidential -- to two years ago during the presidential campaign. we compared early enough 24 months ago to show the difference between that and now and found that in 14 of the 28 states plus the district of columbia that to this form a party registration independence and other affiliated voters were

growing faster than democrats and republicans. i should note that in most of the state's democrats were also rising. republicans were fairly flat. the democratic rise might reflect what was going on in 2008 at the beginning and then as the campaign went on the democrats did a better job. but all throughout it is clear -- excuse me, the unaffiliated voters are rising faster than either one. >> host: we have republican, democratic, and private lines. if you are an independent and have newly become so will you tell us about it and why you make that decision? we will put the phone numbers on the bottom of the screen. what does that mean for the 2010 elections? >> guest: in theory it should mean that there is room for moderates, room for canada's who are w ho are in the middle which might be encouraging to some people who think there's too much dark blue and dark red. they want more moderation. i say that is true in theory

because as more -- as the democratic and republican parties have a smaller percentage of the registration that means that those primary voters in states that have closed primaries susan swain that would be only democrats or republicans respectively. the people voting in the primaries will tend to be more toward the extreme. the candidates is coming out of primaries may be more and liberal on the democratic side and more conservative on the republican side. in general elections everything can change. in 2010 john mccain in arizona is being challenged from the right. he might benefit from, mccain might benefit from the rise in independants. although charlie crist is on the ropes in florida, he might choose to get out of the republican race and run as an independent. anything can happen, as we have

seen. >> host: another poll that has done a great deal of attention is that to study which suggested that americans disaffection with congress is at an all-time low. this this suggest more active involvement in the elections are just staying home. >> guest: well, it is hard to read voters' minds. i don't think -- i would think that in this -- first of all, voting will go down in the midterm election to refuel have anywhere near the numbers we had in 08. the disaffection that is going on is going to lead a lot of people to vote to be how the vote is another question to beat we don't have yet a lot of third-party candidacies. i should note for instance there is a lot of this independent rise that has been going on for a couple of decades. in new england you have three very viable independent candidates for governor. maine, massachusetts, and ryland. maine has had a couple of independent governors in the past. so there is a chance that you

could see voters choosing to go independent. i don't see -- right now it seems like their anger is so severe that i don't think there is the normal response which is to stay home. how they vote is another matter. >> other recent polls, the people who call themselves a supporter of the democrats and the republicans is getting close to on par with people who say they support the to party activists. >> again, it is a little unclear still even after a year or more but the tea ut the tea party represents. they certainly don't represent all or probably even a majority of the trend that we see the people choosing to register as independents or affiliated. there probably are some percentage of those who represent tea party folks, but it is unclear to me, at least, where the tea party movement had said in 2010. if we thought that was the majority of this and we would say that those voters who are

going independent are doing so because they are upset with washington, upset with more government, upset with more taxes. it is not clear yet that is why they are choosing to go independent. they are obviously frustrated with washington, congress, the white house, and the two major parties. why they are frustrated and whether that is mostly a libertarian tee party anti-government sentiment we don't know. >> we are looking at voter affiliation iliation and realignment. there is also a realignment going on in great britain. we are covering three of the first ever candidates among the three party candidates for in the british parliament. the number to debate is happening today. i think it is at 330. check my time. we are going to have it live on c-span 3. double make sure all that information is correct. it will also be aired on sunday night. let's get to telephone calls.

we like to talk about politics a lot. we are going to begin for richard wolfe and a call from san luis obispo, california. this is -- let me see if i can find it. you are on the air. >> caller: hi. >> host: good morning. >> caller: i have a question about, we did not have political presidents until lincoln. you guys in the media act like we have always have them. can you address this because i think that is so bogus that for the first tender gears we did not have a political president. now the past hundred years we have had these political bass string it out. you guys don't address that. >> host: of right. >> guest: i am not sure exactly how he means we don't address it other than in the news business we are not talking very often about the era before abraham lincoln in the 1860's. i guess it is true. >> host: do you agree with this analysis that we did not have political presidents before

lincoln? >> guest: well, i am not that great a student of the first 15 presidents. i imagine i am not going to quarrel with the fact that, perhaps, things were less -- a think what he means is that things were less argumentative, far to the right, far to the left types of elections prior to that. starting with lincoln -- lincoln was a republican president. we went more to the d's and r's. true, if that is his argument that we don't talk very much about the first 15 presidents and what happens in that era, it does not enter into news stories all that often is all i can say. >> host: i was off by half an hour. it is at 3:00 p.m., not 3:30. we will carry it live on c-span3 and it will also be on c-span.org. you can watch it on sunday. there it is the announcement on the screen. next telephone call for richard wolf is from shenandoah, pennsylvania. this is kristine.

democrats line. >> caller: shanandale. >> host: not even close. >> caller: anyway, i am under the impression that president obama is way too far to the right. he gives in too many times. we don't get enough news out of other countries. ten years ago germany felt that by now just by the high-speed rail and the people's energy electricity uses they would need two new nuclear power plants. the government asked the banks to loan. we wanted to participate. enough money to finance the solar panels on his or her roof. the electric company was ordered to repay citizens seven times more than the amount due for excess energy. that pretty much equal the mortgage on the equipment. today ten years later after many jobs were created to make that solar equipment no new power plants remain and germany has more solar panels than any other country in the world.

they are now creating as much power as eight nuclear power plants. why are things like that, reported? why are we only during the same old thing over and over again? >> host: all rights. >> guest: there are several points. one is the decline of foreign news in newspapers and in media in general which has happened partly because of the economy and cutbacks. it is very possible she is seeing less foreign coverage, particularly by reporters working for those knees entities. the second point, i think, that she is raising is that there are ways. maybe we should get congressman barton in here. there are ways to address our energy needs without expanding nuclear power which president obama has agreed is necessary as part of his energy plan. i stress as only part of his energy plan. that think the caller is saying there are countries where they don't have to go nuclear in

order to expand their energy base. that is true. the third point he raises is that obama and her mind is too far to the right to be there is -- we come back to who is the democratic base at this point, whether she is a registered democrat in pennsylvania, i don't know. i suspect she is to be at the pace of the two parties, to get back to the topic, is probably each year, each couple of years there are more independent and unaffiliated voters the base becomes a little more liberal and on the republican side of the more conservative. you are hearing from her a growing sentiment among liberals who are very important in electing president obama, canada obama two years ago, some of whom feel that el that he has gn in too much to republicans. obviously that is another school of thought. he would not be getting the achievement he has gotten on health care and other things if he did not try to negotiate with the other side. >> host: talk more about his

recent story, frustrated voters cut ties with decrats and republicanbothe electorate. our producers found other stories that tie into this. for example, in the state kansas and ohio voters helped to change the registrationbefore primaries. in oren unaffiliated voters shake up board in politics. in north carolina the fciu working toward north carolina third party. let me mix into this a question from the viewer about primaries. i won't find it in enough time. but asking about doing away with primaries and allowing people to vote multiple candidates in a general election. as the electorate becomes more independent in these states partisan primaries play what will? >> guest: well, that is part of the trouble. as the electorate becomes more independent there is the presumption that they are doing so because they sort of feel a pox on both parties.

as they leave the republican or democratic party or as those parties, perhaps, don't grow as fast as unaffiliated independent voters that leaves the base of those parties to decide who their candidates are going to be in primaries other than in states where there are such things call open primaries. that is one of the reasons for the growth of unaffiliated voters in the state. you can be an affiliated and not to identify yourself as a republican or democrat and still have the option of voting in one of the party primaries if you go and choose to vote in the primary. sometimes it means becoming a democrat or republican in order to do it. you can and become a democrat or republican right afterwards. the problem is that as more people become independent a lesser percentage of the registered voters are left in the two parties. what it could mean is those primaries produce more partisan candidates just like reapportionment and redistricting is producing for

house members more partisan democrats and republicans because of the how districts are being drawn. that is a problem that goes back for this decades. you're going to have the same potential in the primaries. people that would be left happily satisfied. likely to be those more liberal or conservative. >> host: how many states have open primaries? >> guest: i don't know the number. there are 28 states with party registration, plus the district of columbia. twenty-nine. i don't know the exact number that are open primaries versus closed primaries. i'm sorry. >> host: pennsylvania, michael. >> caller: good morning. thank you very much. i am a first-time caller. just want to say that i am going more and more toward independent as a republican and the democrats have given up our voice and they don't care really what they think and do what they want to do. i was always a republican because of ronald reagan and what he did. today i am disgusted with the

media and congress. everyone continues to think that america is still the richest country in the world. 1960 we had 50 percent of the wealth and now we have 40%. all you have to do is look at tv and china. places in india which are much more beautiful and much more progressive than the united states. the united states has its claim in the eyes of the world. thank you. >> guest: it is interesting that he mentions china and india. as those are two of the countries that on an increasing portion of our debt. i think the caller is upset with the degree to which this country has gone deeper and deeper into debt through annual deficits. it is an issue that would get a lot of attention over the rest of this year. president obama and members of congress appointed that will begin to meet next week. although there are deliberations that probably won't produce a lot of news until after the elections which is permissible

after the election we will see whether they can come up with any solution to one of the things that i need is driving this, to consider becoming a registered independent. that is can we do anything about a 12.5 trillion growing debt? that will be one of the hot stories. can an 18-member commission come up with a solution that congress would then vote on? the only way congress will be asked to vote is a 14 of those 18 members agreed. so therefore republican members would have to agree to whatever the democrats want. very long shot. possible. >> host: talk about the florida race earlier. the new york times as a political memo. me test the odds as an outsider mark rubio, charlie crist primary battle. from this new york times story

this means that mr. crist will have to win voters across the political spectrum at a time when partisan anger has intensified. sherri brown is quoted, anyone running alone will need an enormous amount of money to be heard above the screaming. later on there right remains an issue. fund-raisers say, will not say whether they plan to stick with the governor if he pulls from the party. florida campaigns are especially costly. talk about the money. >> money is extremely important. joe lieberman was able to win as an independent. he was the elected incumbent senator. losses democratic primary. i can't remember, did he lose it or did he? obviously had the name recognition. the ability to raise money. the governor of florida. i imagine he has the ability to raise money. whether he has the ability to raise money on par with the

party operations, that is going to be very difficult. absolutely true that money is still important. it depends on the independent candidate in question in each case whether that person has the name id and the appeal to get the number of contributions. that would normally be a lot of small contributions to enable him to compete monetarily. money isn't everything. i just think that what we are seeing with this rise of independence is a much more undependable electorate. that is not to say that an independent with $5 is going to be able to figure out how to beat a democrat and republican who has 5 million each. it does mean that voters are fickle. voters are republican increasingly unpredictable. in some states party operations are still very strong. and others, you know, we have seen a professional wrestler. just like in a state like minnesota where you have

governors coming from the relatively far left, the relatively far right. i don't know what you would call jesse ventura, but how does that happen if voters aren't -- and don't think that is happening because they only are aware of one candid out of the three because that candid as the most money and is on television. voters are paying attention and voters are willing to take a chance on somebody who is being outspent if they see what they want to see which in many cases is somebody who is not on the far right or left to is a problem solver. >> host: the federal election commission numbers are out to read a lot of stories about parties, financing, and their states. some dams to well after health vote. she writes about the democrats' fund-raising advantage. the campaign committees this week reported a $21 million edge of republicans in the amount of cash available. house republican campaign committee raised 8 million in

march to e democrats 98 million, the best monthly haul since losing control of the house in november. what can we take away with the way cash is flowing to the parties? >> guest: you can take away a couple of things. one, it is very unusual or has been in recent history for the democrats to be able to have raised the republicans. something is going on. we know what that is. that is the election of barack obama in 2008 and the election of the democratic congress in 2006. money flows to power. the majority of money in the last couple of cycles has followed a little bit more to the democrats than the republicans. in some cases a lot more. they are the party in power. rica is showing that in some cases the republicans are gaining back. what is going on there is also obvious. this is a midterm election. voters are angry. you are they ey angry at? predominantly the party in p

ower. democrats will have a very difficult time. president obama is lucky that he is not on the ballot right now. it is not at all clear the democrats will take a severe beating as they did, say, in 1994 during the republican revolution. so how that money plays out between now and election day is point to be important. the republicans are hanging in rather than getting completely demolished in terms of fund-raising. they certainly have the advantage to win back some seats in the senate, some seats in the house. nobody knows how many. simply reduced democratic majority. >> host: richard wolf. usa today. next call. al on the independent line. good morning. are you there? all right. we are going to move along. next telephone call is from san bernardino county. lawrie, democrats line. >> caller: good morning. your guest had a good point. when i was a kid viable

politicians used to be given air time on the networks. now, the fact that they have to raise all this money keeps them in perpetual campaign months instead of doing things. now, in my district we don't have an open primary. i have to register as a democrat. i don't feel that the democrats or the republicans represent me in any way. i think they are all in it for their own self-interest. here in southern california we are bankrupt. in los angeles, los angeles is being held hostage by the dwp and mayor villaraigosa. i see homeowners all across the country save, but i see politicians to spending our money like they are just going to print more tomorrow.

with over 10% unemployment rate nancy pelosi and harry reid are going to bring comprehensive immigration reform, i.e. amnesty back to the table. and it is disgusting. we need to create jobs for american workers first. thank you very much and have a good day. >> host: california. >> guest: thanks. a couple of good points. one is he started out talking about the amazing amount of fund-raising that members of congress have to do, and that's true. it is shocking how much time members of congress and competitive districts, at least, have to spend every day on the phone personally seven days a week making calls for money. they hate it and they have to do it. the campaign finance system is what it is. there has been a campaign finance law changes. there has been a supreme court decision right now that congress is likely to attempt to address. president obama is backing trying to change the ability of

corporations and unions to spend even more during elections than they currently are able to pare that will be an important legislative battle during the next few months. it is one more battle that obama has a good chance of winning. it is unclear what will happen. so, yes, too much fund-raising in congressional politics. yes. there is somewhat of a solution when it comes to presidential politics. the money of the candidates can get during the primaries and for the general election from taxpayer dollars. that makes things a little better if both parties agree to accept that. he also talked about the overspending by congress and the white house. that is also, that is really, over spending more than anything else or the belief that it is overspending is what is fueling a lot of the anchor and a lot of the growth of independence in his state e as he points out if he wants to have a roll in the primary he has to stay within the democratic party.

it is also interesting to hear that as soon as he gets through that primary is well can be counted on to read while i was saying before that who is left among registered democrats and republicans are probably far-leftist and far-rightists to some degree. that is not true in closed primary states where they might be moderate or they might not be so enamored with the party they are registered with. if they become independent they lose one ability to vote. they lose their primary vote. they can do that. >> host: next phone call is from magnolia, texas. david independent line. >> caller: yeah. how're y'all doing? first off, the obama is smart when you are talking about elections. and the way they're going to beat him, he went offshore and he got the old money. he has opened nuclear plants to be he's death the nuclear money. he is going to have all the money. did and well.

here is the way i look at it. don't matter who you elect. that is why i went independent. >> host: how long ago did you do that? >> caller: about four years ago. it is because as soon as they get up that the money hits them. you can turn the money down. >> host: what party when you registered with? >> caller: i was a democrat. >> host: thank you. four years as an independent for david. >> guest: a couple of things. i don't think anyone would say seeing what we have seen since last january 20th 2009 that it does not matter who gets elected. at the difference between the bush administration and ation ae obama administration is very clear. for better or worse depending on your point of view there is a huge new national health care bill if it was not for who we chose to elect. that will play out again and again. it is trying to play out to a lesser degree on the financial regulation legislation that is

before the senate now. that may be the one major bill of these two years that because bipartisan. it is not fully bipartisan yet, but it is headed that way. on most other issues i think what we have seen over 16 months is a lot of the change that candidate barack obama. whether you like it or not is a totally different question. i don't agree with the caller that it does not matter who you elect. that is what you're asking before, whether these people who are going independent are going to figure it is not even with voting anymore they are so frustrated or they are so angry with one direction or the other, what they perceive as the correction of washington that they are very much inclined to vote at a vendor. i would think that, i would guess that it is going to be more of the latter than the former. more people voting and of anger and frustration. >> host: "usa today" this morning has another snapshot of you, the voters.

susan paige has written this for the paper. americans overwhelmingly say civility is important to democracy and possibly even, and possible even when people disagree. digging deeper into debt, and i would like to have your response. when asked about seven specific issues solid majority said elected officials could find compromise solutions on all but one of them, abortion. about two-thirds of compromises to be found on immigration and climate change legislation. two of the most intensive issues now being debated. there were significant -- this is the part, significant differences by ideology. liberals by 59-36 percent favor the ability to compromise. conservatives views were a reverse of that. by 60-34 they preferred a willingness to stand firm. >> if i was interpreting that -- a was a little bit surprised

when you said liberals wanted more compromise. as we heard from one caller earlier a lot of left, people who are so that the left have been a little bit disappointed in some of the rhetoric and some of the decisions he has made since coming to office because they wanted him to stand even firmer, for instance, and public auction on health care. here is why it makes sense. the democrats are in power in congress and the white house. if there are achievements out of washington regardless -- i should not sit regardless. to some degree regardless of the details of those achievements they accrue to the democratic majorities in the house and senate and a democratic president of the united states. if there is sufficient compromise to get things done it is the democratic congress and president who are going to get the lion's share of the credit. on the republican side the republicans in congress basically made a decision after obama was elected that the way to when congress and the white

house back was to oppose as much of this agenda as possible. that is not to say every decision they make is political and they are going to find a reason to oppose it, but opposition by the party out of power is their likely to get back to power. by compromising with president obama on issue after issue voters might be more satisfied with how washington is behaving, but it is unlikely that is going to put the republicans back in power. so i think republican voters are seeing the same thing that republican legislative leaders are seeing. >> host: richard of. this is changed and our our republican line. good morning. >> caller: good morning. i feel that the two political parties have hijacked the democracy system. you see it. they seem less interested in

listening and much more interested in listening to the third party leadership. i have a couple examples of that. in 2008 in the fall you saw a huge number of politicians ignoring the constituents and voting for the bank bailout bill with that extra $150 billion of the march on top including guys like john mccain, john bennett, mcconnell, guys whose constituents did not want them to vote that way. this year where you have some democrats they voted yes because of party leadership. i just feel now if you look for somebody that person does not represent you, they represent their party. i want to know how you feel. >> guest: i think they don't represent -- i would make one twist on what you just said. that person doesn't represent you. they represent their party. i would say to some degree it is that person doesn't always

represent you. they were elected by you to do what they think is right. the reason i say that is when it comes to the quote unquote bailout of the financial institutions which largely occurred at the end of 2008, the very end of the bush administration and during the transition, which obama pretty much supported, a lot of members of congress regardless of what they were hearing back home were hearing something that they believed, perhaps, was more important from people from the treasury secretary and fed chairman which was this entire economy could collapse. we could be faced with the great depression. the situation could get so dire you you have never lived through anything like this economically. really what we need is for this bailout to pass no matter how bad it might smell. acting that is what you saw when you saw a lot a lot of people gg against the wishes of their constituents. that was one of those issues where members of congress were called on to do what they felt

was the right thing regardless of the sentiment back home. and i think honestly that is their job. sure, they have to represent constituents as much as they possibly can, but then you hear voters disdainfully saying, oh, that politiciantake a poll polln everything. if he takes the pole on on everything in his district he is doing what you would want to do. he is figuring out exactly what percentage of people in his district want to do yes or no and he will go with the majority. that is not exercising free will at all. in a couple of these cases what you have is members, perhaps, give them a break, doing the right thing to be . when it comes to health care bill and the democrats and moderate and conservative districts who voted yes, sure, you did see a lot of democratic party arm twisting because this was, really, this was the big kahuna. this was something the democratic party had tried to do since harry truman and bill clinton and others. they really, really wanted to

get this done, a, for the policy of giving far more people health coverage and making it more affordable. and also, b, because they felt that failure would be terrible for the party in the upcoming elections. so, yes, i think you did see a certain amount of moderate and conservative district democrats being cajoled. that is a light term. it was a lot worse than that, by their to r leadership to vote ty they did. and that is not to say it is wrong. if the bill works out then they took some what of the noble stand. maybe they will be paying the consequences for it back home in the next election. if that is the way it plays out and they voted yes, but you vote him out of power and that is really what politics is all about. >> host: as to how the parties are reading the tea leaves, lots of different signals out there. we showed you the "usa today" story which suggested that the

democrats in the and try to support the bill are seeing an increase in their funds in the district. on the other side of the coin the "wall street journal" story, gop candidates scored seniors, health care overhaul backed by democrats portrayed as damaging to medicare. michael phillips writes in other senior heavy areas of the counter republicans of trying to use medicare cuts and other health-related issues to bludgeon democrats. the jockeying over the health bill. issued a health release aimed at inspectors. he votes to kick pennsylvania seniors off medicare advantage. more details in that story. we are seeing messages from both sides. tampa, florida, you are up next. you are on the air. >> caller: good morning. i just have a question. here in florida for the senate race charlie crist and robio. it is 8.2 million. now, florida is supposedly

broke. to pay our unemployment benefits we are having to get the money from the feds. why does it cost so much, and are we really as broke as they are saying? i will get off the phone, and you can answer the question. thank you very much. >> guest: well, states have to balance their budgets. states are, from what i can tell, really as broke as their saying. the federal government does not have to balance its budget. it is more than broke. it is in debt, running deficits of a trillion-and-a-half every year, running a national debt of 12.5 trillion. that is headed just on autopilot to beyond 20 trillion or more of the course of this decade. yes, we are broke. next question, if we are that broke who is it that is bankrolling his elections? where is that money coming from? that is the political system we

have where people with contributions to make, people with money are not being asked by the government, please hand it over to the treasury so that we can spend more on unemployment. they're being asked by the democrat and republican parties, give to us so that we can win the elections of that we can influence the next two or four years of policy. we will do something about the other problem, the fiscal problem that the states and the federal government face. it is just the political system where we have with that much money every political cycle goes in to campaign financing. >> host: marcia, north carolina. sherry, independent line. >> caller: i am calling regarding your comment. realignment. i see it more as a matter of the republican party looking to disrupt in order to achieve their party realignment. the tea party is using tax relief as a smokescreen. they have people whose life

styles are based on unbridled consumerism. considering the history of the republican party which was supposedly found that for purposes of abolishing slavery, after they destroyed the nation they had no plans for slaves who were subsequently abused. i would like to know how these tea party people are going to get themselves in the tickets when the green party has been struggling for verification state-by-state over the years? thanks very much. >> guest: a lot of different points. the tea party to my knowledge is not trying to get on ballots the way the green party or the libertarian party is. the tea party is more of an ephemeral movement. i don't know. the college started out talking lking about the republicans trying to reposition themselves. where the republicans want to head and where the tea party is,

per se, and they are a desperate one ahead, is a question mark or one of many giant question marks in this election. it is not at all clear is that the republicans have that the party figured out. so i am not so much disagree with the caller as saying that she started out talking about what this realignment has to do with a grand republican scheme were strategy. the republicans should be so lucky to have the scheme or strategy. right now they don't really know where this tea party movement is headed. it is not at all clear that it is headed their way. >> host: last call, michigan. richard. good morning. >> caller: good morning. i guess i would have to consider myself a few years ago as a kind of centrist republican. i can point to the very moment that the democrats drove me further to the right, oddly enough. that is when on in b.c. some of

of the mainstream media, when the democrats to took power it was reported heavily, and i believe it was nancy pelosi that made the statement that we don't need the democrats -- we don't need the republicans. i felt enormously marginalized by that statement. rather than going independent, i was so offended by that statement. it actually drove me further to the right. >> host: i'm going to stop you right there because we are just about out of time. any reaction? >> guest: i don't remember the statement by nancy pelosi. i would not doubt that some members of the democratic party being gleeful might have said that. i was going to say that he is very typical of a lot of republicans who you don't see many moderate republicans left. you don't see many left even in new england where there used to be the majority of the republican party. you don't see any moderate republicans such in congress.

so the move that he has made is typical of many. go back to what we said at the beginning. the rise of the independence is one thing. the people who are left are moving to presumably the edges of the democratic and republican parties. he would be an example of that. >> host: one thing we can agree on would be an interesting year. >> guest: certainly. >> host: thank you for being here. >> on tomorrow's washington journal a preview of the immigration reform debate with roll call reporter john stanton. discuss proposals to create a value added tax in the u.s. and jon-christopher of sky news recaps thursday's british campaign debate. washington journal begins live at 7:00 a.m. eastern on c-span. >> next on c-span2 a house

committee listens to the creation of a movie futures market. commodities market for future founds. britain's political party leaders hold the second of three televised debates. later a memorial in memphis, tennessee for civil rights leader benjamin hooks who died last week. ..

the federal government recently approved the creation of a marketplace for investing in the future performance of feature films. on wednesday however the senate agriculture committee passed a bill banning such exchanges. this house agriculture subcommittee examines the issue with government officials, entertainment and financial executives. the chairman is leonard flow of iowa. this is two hours. >> are hearing will come to order. i'd like to thank everyone for joining us here today as we take a thorough review of proposals establish exchanges to trade movie features are out there to give a special thanks are witnesses were testifying before

the committee and offer their insight. tangibly explores a novel new product to be considered for trading on a future exchange regulated by the commodity futures trading commission. this product is movie features or box office derivatives when the commodity exchange act was first passed in the 1930's, it was very unlikely that the congress envision such a product would be regulated by the act. even subsequent amendments to the cea i doubt those here today foresaw the development of this type of exchange. fabulous replica of the proposals to establish the sparks of exchanges are seeking approval of contracts that would be offered there. i am pleased to both applicants are here today to discuss the products in more detail and hopefully answer some of the concerns that have been raised about the nature of the market of these products. mitigating financial risk as a primary reason for the future of these exchanges. however, the natural edges of the products have for the most

hard insisted they will not be using the products to hedge their risk for various reasons. we look forward to our witnesses today on why this may or may not be decreased. as the ftc has approved the application to a stylish these exchanges of the contract are still coming. this is especially timely given the current regular affairs. we understand what the established an established and prohibition of such exchanges. i hope the witnesses will provide the committee with the context necessary to better understand these exchanges and the issues presented by them so that the members here will be able to ascertain the correct course of action going forward for future consideration of this application, for the cftc am allowed to congress. again i would like to thank everyone for joining us today and at this time either to turn over to my good friend and colleague, for any remarks would like to make. >> thank you, mr. chairman.

somebody told me several months ago or a month ago we'd have the motion picture association of america and the tractor spilling from a tight committee. i thought they were kidding but here we are. and we are here to review the proposal were to box office future exchanges in the contracts to be traded on those exchanges. in fact the exchanges are no longer proposals because the cftc has both the cantor change the media driven its exchange in the last week. my understanding that while the exchanges have been approved the actual contract are still pending, commission and review and approval. hopefully mr. berkovitz will elaborate on the profits. until two weeks and i never heard of this concept simply here to learn about a new exchange, the contract of those exchange -- the contracts of those exchanges planned to trade and the benefits and challenges that each may present. the commodity exchange except for this set of standards and exchange must meet before it is approved by the commission. a planet which exchanges met the standards of analysis used by

the commission in reaching this decision. for instance, if the commission and the witnesses expand economic relevance of these exchanges and the potential contracts these changes will trade. i also want to know how these exchanges will prevent potential profit manipulation that might occur. in addition or someone is a set of concern about the contracts and i want to gain a greater appreciation of those concerns. i like forgery in the witness' testimony and hope to learn much more about this new concept of box office future exchanges. thank you, mr. chairman. >> thank you on this trend. i'd like to recognize the hole for him. >> a want to commend you and ranking member for being on top of this issue. sounds like there's going to be a vote so take up anytime and get with the business. look forward to hearing what the witnesses have to say. >> thank you and often other members present can be included for to get for ticket assignment to the task before us.

we recognize the first witness and thank mr. berkovitz for being here. mr. berkovitz, please. >> thank you, mr. chairman. good morning, chairman boswell, ranking member moran, member peterson. thank you for inviting us to testify at this commission on the possible trading of movie futures contracts but i like to request the full written testimony be included in the record. the commission's testimony addresses the standards and procedures with which an exchange must comply to be approved at the designated contact market for d.c. on. this testimony will also describe the process of the commission's review of the box office receipts future contracts proposed to be listed for trading by the two recently approved dcm media derivatives and cantor futures exchange applicants were dcm license must demonstrate to the commitment that it complies with the requirements of the commodity

exchange act and the commission's regulation. specifically the applicant must make a showing that it complies with the designation criteria and 18 core principles in the cea. the action under christ the commission approve or deny designation application within 180 days after it was filed. if the commission denies the application, you must specify the grounds for denial. with regard to the approval of a product to be traded on the dcm, cea provides that a dcm must either sell certified new futures and options contracts or voluntarily request approval of new products. to self certify a new contract, the exchange must provide to the commission at a minimum the rules that establish a relate to a contract terms and conditions along with a statement certifying that the contract and price the axing's regulations. if an exchange request commission approval for a new contract, the cea requires the commission to approve or disapprove such a product within 90 days.

the cea requires the commission to approve such contract unless the commission finds that the new contract will violate the cea. it is the commission's practice on a contract filings are posted on the commission's website and public comment is requested. the primary focus of the commission's review is to ensure that the contract is not readily susceptible to manipulation and that the contract of speculative limits or position accountability level as appropriate. the contract market designation process in the contract approval process are separate and distinct. the two processes involved in the review procedures, time frames and approval standards. contact mike about the cans have the option to submit an application that does not include a proposed contract. however construction with the review of the new dcm application with the contract is not part of the application, the commission staff typically inquires about the type of contract he applicant intends to offer for trading.

information about potential products to be traded helps inform the stuff about the nature of surveillance and oversight measures exchanged would have in place to be designated. the commission is recently approved contract market designation for two applicants to contemplate listing box office receipt contracts. the commission designated media derivatives on april 16 at this year and cantor futures exchange on april 20. neither of these future exchanges admitted their contracts as part of that dcm application. in both cases the commission carefully consider the applicant submitted materials, representations made and demonstrations really to the designation criteria and core principles for the commission determined that the media derivatives and cantor application satisfied the requirement for the cfa and cftc including the criteria and core principles for the order of designation for both media derivatives and cantor requires them to submit for review and approval an e-mail of the

category of media with it a product prior to listen to them for trading. in doing so the commission preserve disability to affirmatively review and approve these categories to futures contracts prior to their listings by dcm's. media derivatives for post-contracts are under a preview here the commission will carefully review these proposed contracts according to the timeframe and standards under the cea and the commission's regulations. the focus of these reviews will be to determine whether the contracts are not readily susceptible to manipulation, whether they are appropriate, whether they're appropriate limits are accounted below to and the cash settlement process. in summary, the commission is committed to filling the statutory responsibilities to oversee the futures markets. it is carefully reviewed the two recent dcm applications and determine that they met the statutory standards. with respect to the contracts are needed for approval, the commission similarly will

conduct a thorough review, if they can comments and make a decision based on whether the contracts under review of the statutory criteria. thank you for this opportunity to testify. i look for 20 questions you may have. >> thank you. before we continue i like to recognize mr. goodlatte from virginia has joined us. although is not a member of the subcommittee hears here with us today at former chairman our full committee and consult the ranking member were pleased to welcome them to join us in question today. >> thank you, mr. chairman. it's a pleasure to be here. i look for during the testimony of the witnesses regarding a very interesting subject. >> okay, welcome. first question i guess would be in reviewing the applications, did cftc examine the hedges both short and long for the products and if so what did the cftc discover? >> as i described, mr. chairman,

the contract application process and the contract review process in the designation process for the exchange are two different processes. so when the designation process for the exchange itself from improving exchange we reviewed whether a method definition of the statute including whether they have the training facility, how the trades are executed, and the integrity of financial integrity of the contracts and the various systems in place to ensure fair and equitable trading. regarding the contracts, the questions that she raised her more appropriately part of the contract approval process, which were every now. those questions are some of the questions were looking under the contract approval process. >> another question. we explained by the commission approved the inside information to participate these markets. all things equal with inside

information be allowed to participate in sec regulated market? >> we have included in a condition for the application -- as i mentioned in the oral testimony, generally the exchange approval process in the contract approval process we suffer your different. we have looked at the exchange in these particular instances. the request for approval of the exchange, with a view towards the contracts will be traded on the exchange. we've been in discussion with both applicants can assume we have a negative. we did in fact know their intentions to list these contracts. part of that, to address the concern you're braced about people inside information, potentially about the eventual box office numbers trading in those projects.

we have included in the contract approval -- and the contract approval process the condition that these exchanges have what we call firewalls between the people inside the studios who would have actual knowledge of the box office receipt from the people in this movie studios who might be trading for hedging purposes or whatever purposes for the studio. so we have included firewall positions as part of the exchange approval process for both exchanges. not only does it prohibit them from the people having inside information about the actual box office receipts from trading, but it would prevent them from communicating information to others in the organization acted on that information. so those conditions have included as part of the approval process for the exchange. in addition as part of the contract approval process were looking at the question further in terms of whether the contracts themselves are susceptible to manipulation.

so the question is in view of these particular contracts now in the conservative than raised by these contracts, we are looking at that issue with respect to these particular contracts are the firewall position have other concerns than raised the need to be addressed as part of the contract approval? >> okay, i'll further questions come to think all recognize mr. moran this time. >> thank you, mr. berkovitz. how does the cea define a commodity and how does the box office futures contract fit within the designation? >> the commodity exchange act defines a commodity very broadly. it's basically anything they could come an article, a service or an interest in anything in which a contract for future delivery is built-in. so if something is subject to a contract for future delivery, then under the commodity exchange act it would be a commodity. >> in the future delivery in

this case is what? the future delivery is the box office receipt. it's a number of bits related the actual box office receipts. >> my questions may be more related to the actual contracts, but what type of data to the exchange is used to settle those contracts? >> according to the information that's been supplied to us today and we're up this question in great detail, but they basically -- they're going to be relying on the tally of box office receipts that is provided as a service that provides from the movie theaters to the studios the actual box office receipt numbers are affected straight to the studios and the studios i believe mlb better able to answer the questions

also collect some of this data in the studios put the data together and then there's the final number from the receipts that they get plethora of information. >> when you say a final number, is that they actual hard number or is that an estimate? >> i believe -- i believe there is an actual firm number. >> okay. i was the opening price of a contract determined and are there currently any other exchanges that use that method? >> my understanding and we can provide further information on the record on this number but generally my understanding of it is that it is similar to the process that other exchanges use for determining what the opening price of a contract is, that there is before the contract is actually open for trading, that there is a type of bidding process that goes on, that the exchange is used to establish

where the contract should be treated as similar. we can get you further information on exactly how that would be determined in any similarities or differences. >> to have an estimated and time at which the cftc with nick and estimation in regard to the contracts? >> there is a statutory deadline i believe for the -- it's june 7th for 1 of the contracts in june 28 for the other one. >> mr. chairman, thank you and the yield back. >> the chernow recognizes mr. counsel from north carolina. >> thank you, mr. chairman. mr. berkovitz, trying to get an understanding of knowledge of the subject matter. when the commission is looking not a new product coming onto market and you mentioned about the factors that are considered in whether this is legitimate product or not. how then judgment outdoes the commission become in terms of

one extreme, just a clio cave meets the points, five of do it. the other extreme, you know, this has no business being there. this is just not something we should be doing. how does that way in terms of once again is just black and white there are judgments on shouldn't be there? >> generally our first black guy would be used for something that the contract for future delivery. the searcher is fictional base, so we say is this a contract for future delivery that's appropriate for further review? it is indeed a contact for future delivery, then we apply the standards set forth in the act, but primarily it is not susceptible to manipulation. other appropriate limits? is this a moment price of contract appropriately the determined whether process for determining the price and integrity in the process.

>> what considerations might be given to unique circumstances that could affect a movie's popularity in terms of the investments that were made versus perhaps insurance that might be used all set unexpected we found out three days before the release had been having illicit affairs or the snows came deep in february in effect did the opening day or there was some other crisis that kept people at home. are we opening ourselves up to issues there that are beyond what we should normally expect or how does that play in? >> well, our primary focus is on assuring that there is no manipulation of the price of that commodity that is traded.

so we would have our surveillance in the exchanges we required to be exchanged rabid to be sure there is no artificial price created to any intentional manipulation of the price and we watched the price move and ensure that indeed the price of these and many contracts that are determined according to the laws of supply and demand basically. >> thank you, mr. berkovitz. mr. chairman, i'm looking for gearing more of the arguments from individuals. i yield back here to >> thank you. goodlatte. >> thank you, mr. chairman. mr. berkovitz, welcome. jenny think of any other commodity that is traded on the major exchanges is anything like a motion picture? >> in a broad sense, the motion picture contract one could describe it as an embedded type contract that is related to an

economic event or an event. we have weather derivatives. we have -- >> the weather derivatives are beyond the control of any individual, are they not? >> certainly. and the gentleman from north carolina race those funds. some of those were big snowstorm beyond the control of anyone who's trying to predict and that certainly would not be unlike buying corn futures, not knowing what the weather was going to be like were things like that. on the other hand, the motion picture is of committees one of those that is produced is a very unique product, very much unlike the next one, whereas one barrel of oil is not much different than the next one. one bushel of corn is not much different than the next one. one euro dollar is not much different than the next one. so it seems to me that in looking at the very broad definition of commodities that

the cftc pass. nonetheless in looking at motion pictures coming or going into an area that we have never done before in my opinion. can you give me anything that is like that, that is us such subjective value is a motion picture that is offered on these exchanges? >> i think the issue that you raised in terms of control or ability to affect the price in terms of a weather derivatives can affect temperature in chicago or seattle. the question that has been raised these contracts, can somebody affect the box office receipts and that distinction is indeed something that we're looking at and seeing whether or not -- >> i've heard there are some discussions with the cftc robotics and people who were involved in the making of a motion picture from being about trade these future contracts, is that correct? >> the conditions that were

imposed upon the exchanges themselves, the firewalls between people that have knowledge of the is, the actual box office receipts. we are examining again whether those firewalls are sufficient for these particular contracts. these concerns have been raised about who really has this type of knowledge. >> no, but if you were to do that and say that all the producers underwrite or as an act there's in crews from the people involved in the promotion of the movie and so on were not allowed to purchase date because they have a better idea than the average public about whether this movie is going to be an "avatar" or this is going to be about, correct? that would be a concern. but i does the same people that shoot ordinarily are wanting to have participating in commodity trading because they're the ones who benefit from the persons of

commodity trading which is to take the risk out of which are investing in, like a farmer being able to buy your self corn futures because once drivers at the future price because father or other market conditions might affect his price. or somebody in manufacturing his concerned about the price of natural gas or oil as a resource for their business, they want to buy futures, southwest airlines very notoriously during the spike up and prices they had bought jet fuel futures oil futures are something that allowed them to have a competitive advantage because they had built-in a hedge against the risk of higher prices. but here you're talking about eliminating from the very marketplace the people who might most benefit from being able to hedge because they don't know for sure whether the movie is going to be a hit or not. and therefore think it will

futures on it, they would take away the reward of the smash hit, but they would also eliminate the crash of the total dead. so if it's to mean that the bottom line here is that we're not talking about really commodity. were talking about each individual unique product in the very people who would benefit from commodity futures trading would of necessity have to be excluded because they could manipulate it. >> and typically, the other example and i think your point is well taken. an oil company, for example, the people inside an oil company is allowed to trade on what they believe will be the price of oil. they may have specific knowledge of weatherfield is coming on or not. they might have superior knowledge of what's going on in the oil market. but presumably those traders do not have knowledge of exactly

what the price of the new york mercantile exchange would be. so per se is not illegal or unlawful for some knowledge of the commodity -- >> sure, but like you said earlier one barrel of oil is not that much different from the next outcome but when motion pictures completely different from the next one. and that's also subject wouldn't you say that manipulation by people who are not actually engaged in the production of the movie, for example, movie reviewers were entertainment companies that can play up the movie on their television network or on the internet or another marketplaces. they also would say let's buy some features in this movie and push back out of this movie to try to drive up the box office. or let's buy futures of monmouth panned the movie and see what can drive right down to the floor and make a profit on selling, you know, the

failure -- i don't trading commodity so i don't know to put some options and so on that are involved here. but nonetheless it seems to me that a lot of people could try to profit from this manipulative where there's only so much you can say about a barrel of oil or a quantity of some other source of energy or food or even a currency like the eurodollar or other things. >> indeed the concerns that you have above about potential for manipulation, the different characteristics of these contracts that you mentioned. we will be looking in in on a very close in the product review. we have initially the condition of the approval of the exchange itself of the firewall, but whether that is sufficient or not and might of these particular contracts is something that we are going to be looking very closely to address those very concerned to have raised.

>> thank you, mr. chairman. >> thank you. chairman peterson. >> thank you, mr. chairman. so, in your view or the commission's view, movies are a commodity? >> the contract were looking at indeed whether these are to approve these contracts for future delivery. >> so if you decide to approve this air, then you're deciding they are commodity quiet >> if we were to approve it. >> and apparently you are thinking about having anybody who knows anything about this trade in it. from what i understand. >> the distinction -- the current firewall is between the people who actually know what the number -- >> i understand that. but there's also been discussion, including anybody who's got to do with the movie business on this weird were considering whether the current

exclusion -- >> which are basically talking about this authorizing gambling? i mean, maybe it should be regulated as states or something. i mean, if you include anybody that's involved in this, then the only people you have left are people that are kindling on this basically, right? i mean -- i'm just trying to understand what's going on here. >> but if we determine the contract with whatever conditions that may be placed on it, satisfies the conditions of the commodity exchange act and regulations that will be permitted to be traded on these exchanges if we make that determination for these products. >> so, can there be other derivatives created off of these bad? if these are approved, would she

be able to have credit default swaps be set up to further make its against what's going to happen in order to protect? >> well, if it were -- it would fit the definition of somebody could announcement that would fit the definition of swap under current law, we would have to look at the end to run. that might not be something that would not be within our jurisdiction because of the excluded from our jurisdiction of the fit the definition of swap and was traded by people who can trade slots, the other participants. that would certainly be possible to be a swap delivered as. >> is that being done now with all? >> i wouldn't have knowledge of that. i mean, they raise money to finance these movies. but i do know. i guess that would be one thing. i don't know who can tell us

that. >> presumably under current law software to create a swap rather than a futures contract based on movie box office receipts and sell it to only the people who met the statutory criteria and sophisticated parties called in the eligible contract participants, then i would not be something if they traded it under according to specify that would not be something in our jurisdiction. >> unless we pass a bill here. >> exactly, exactly. and the senate apparently in the bill that they move it out in the ad committee has put a prohibition on these contracts. is that correct? >> that's my understanding. >> have you looked at the language of that? >> we haven't seen the final. we understand that provision is in there. but we haven't seen the final language that was reported

yesterday. >> and we can do that? we can ban a particular type of contract quiet >> you can exclude right now in the act onions are excluded from the definition of commodity. so search in the congress can put in the definition commodity. >> @they've done -- they said movies are not a commodity? >> i believe that's what the box office receives. i believe they've taken out of the definition of commodity. >> already. thank you, mr. chairman. >> the chernow would recognize the gentleman from missouri. >> thank you, mr. chairman. mr. berkovitz, can you give me a definite vision of what she said movies or motion picture would be to put on the exchange? >> the definition of a motion

picture? we have not undertaken to define what a motion teacher might -- >> to me that's a pretty important point. we have a motion picture now it could be anything from what we believe is a big rock buster "avatar" all the way down to -- i made a list a documentary, x-rated movies, cartoons and by your box office received the academy and six movie theater screens we have made for movies which generate income from the standpoint they're put on tv and advertisers pay to have there ever ties and shown during the showing of that movie. his back in the fall of the definition here of somebody that could execute a contract on a movie that's been made for tv and if we don't generate enough advertising revenue to pay for the production of the movie, that the producers are covered? is that something that could also be construed here to

following your definition of movie? >> the contract terms, when i talk about the product approval of the contract terms, each of these contracts or contracts for future delivery. they have a specification in the contract, what can be traded, which types of movies can be traded and i don't have the application right in front of me that it is specified in the application so that is what bruce ewing is what are the movies or what may be that will be subject, whose box office receipts will be something that we put on the exchange for future deliveries. so that if something were looking up. what is going to be subject to these box office receipts. >> to me it seems like you're going to have to nail down the definition of what a motion picture is here because they

think you can construed to be any of those things. were going to be back in the take a lot of mileage burrs sometimes. x-rated films and that's going to go out there and produce one of those that want to protect themselves, they've got cartoons. i mean, all those things are types of motion pictures that if they fall under your definition near 600 movie screens -- an intimate look at a tv screen is a movie screen? >> i think at this point, you know, your terminology is going to have to be really nail down a little bit more confining -- i mean right now we have it so broad that a list of things we're financing everything that can be put on a movie screen including what goes on a tv in my judgment from what you see here. it's very concerning to me. right now, and is there a defined market and some folks out there that really want to trade in these things right now? or is this the cancer group of an escort to be something

happening? is there a defined group that's looking to try to take the risk of these folks? i think probably the witnesses on second panel might be in a better position. our role is to determine whether in fact these products in some of the issues you describe the specifications in the act and then indeed he >> been asked this question. what do you think is the inherit problem in the cftc? >> our role is to ensure that any contracts that are traded on a regulated facility are not susceptible to manipulation that their appropriate position limits on these contracts to make sure there's no thing i'm petite is too greater share of the market and can influence the price is by having too a shared or that the settlement process, the process for determining, the

box office receipt number that process has integrity and that's a reliable number and not among connive statutory vote what we've been directed to do under the act. >> so mr. peterson asked while ago i think a couple other folks refer to the numbers of people who have access to the movie production, whether it be the actors are anybody who works on the third, any of the writers, whomever -- all those folks at this point are not printed from participating in this. are you looking to train to do that? >> we're looking to draw the appropriate firewall, a few may, between the people who have actual knowledge of the box office receipt numbers who will know if that price is and to ensure and they will not be able to trade or give information to others with traded leather. that is the full extent of the separation. that is something we're looking at in this product approval process.

>> thank you, mr. chairman. the chair recognizes mr. marshall. >> thank you. i was outside may be asking questions that never even ask her if i do, i apologize for that. it's hard for me to see who takes the other side of this product. if you don't exclude insiders, so, you know, the movies in production, it looks like it's just not going to produce basically the houses on fire, but were the only people who know it. so we're going to rush out and buy insurance. well, that would be kind of a fool to be the other side of that to the supermarket with weekly conclude this is too dangerous and could really get stuck as a result of the fact that people will have unique knowledge about whether to buy or to sell concerning this particular product.

and so from a disc packaging perspective, i can see those who are interested in offering the product trying to sanitize it so that it behaves more like a regular futures and commodities that wouldn't, you know, you wouldn't have inside information along those lines. i'm a little surprised though that the cftc as part of the approval process is coming up with this firewall concept. can you give us examples of other products we've got firewalls? is the sort of a new concept for these products or are there other products your firewalls? >> i know cftc personnel specifically can't invest in other people who have unique knowledge, you know, the owners of the exchange, things like that. can you pick a commodity where the cftc has imposed some firewall concept like this? >> i believe it is a new type of condition. >> well, i don't like the fact

that we are very clumsy with our effort to legislate in this arena, britain is the fact that we have a contract for onions forgot takes. i don't think we want to set up some regime where everyone is running to us because they're worried that some products might be approved inappropriately by the cftc. and so we start having to the list. it's not onions and the ins and outs movies announce whatever. i don't know what it's going to be. seems to me the cftc needs to help us out here and coming up with some principle or the parties you need to come up with some principle. that can guide the cftc and guide congress and concluding yes no your this is an inappropriate product. and i just don't see how firewalls that it. it's a license to lie is basically what it is. it's hard for me to believe that the other site the deal is being sophisticated parties would believe that the firewalls would

actually work, that you think you need a firewall suggest that you're worried about that manipulation issues. it's one thing for the party that putting together the product if you like and that's a firewall because nobody is going to buy the product otherwise. it's another thing for the cftc to say there's got to be a firewall. i mean that the cftc has a very limited confidence in the product for the cftc is worried about manipulation, that this is an extraordinary to focus, maybe too much of a rifle shot could have product to your, where would be just too easy to manipulate the price and consequently the market, the very small market. sweat like each come up with some principle other than firewalls that i mean, firewalls don't exist for any other commodity, it seems to me a big stretch for the cftc to say well, we're going to come up with this concept with regard to this particular commodity without may be a broader discussion with congress about

the cftc's appropriate role in whether or not the cftc should be about the business of approving products with firewalls. and it gets close to sort of wandering into -- there's a big difference or at least historically as i understand a big difference between the sec and the cftc's work for these exchanges have been concerned. we want insider information. it's all price discovery stuff. so whatever information you can get come you bring it to the table. with the sec is concerned were about insider. you're kind of setting up an insider-trading regime within the cftc without having gone through some legislative process to determine whether or not the cftc's will should be changed. in fact, i'm just expressing my concern in light of the fact it doesn't appear to be any other product ever approved by the cftc or any exchange that has this firewall concept. >> thank you, mr. marshall.

you've made some points we been hearing about so i appreciate that. this time are they to recognize gentlelady from colorado. >> thank you, mr. chairman. so obviously, this is brand-new territory and there's a lot of concern, legitimate concerns raised here this morning. and let me just taken a little different vein. you have expertise that the cftc in traditional commodities that are traded and this is a new product. what kind of expertise do you have on hand right now with your current staff and how do you plan on developing the expertise that you are going to need in-house to make sure that these products are not susceptible to manipulation? >> our first defensive course will be the exchanges themselves. they're required for full markets and of course that is a condition of their approval of the exchanges that they have

surveillance and they have anti-manipulation processes in place in both of the exchanges that police have contracted with the national futures association to undertake that, who has the expertise to do this. they have surveillance, market surveillance programs for a number of exchanges. the exchanges are the frontline in the and they have submitted their programs to us that have been part of the approval process. and on top of that the cftc program is in addition to that. indeed to address that very concerned, the market surveillance system that they are required to have pursuant to the nation criteria in the core principles are something that we have book that i found they are adequate. so it's not just the cftc by

health of our staff who will be overlooking these contracts and the national futures association also. >> and of course you know congress is looking at legislation to regulate drug it is, so you will already have a bomber your plate within the next year and then this is taking on coming up, additional work and additional commodity. what are your staffing levels like right now with the exchange in order to handle all this additional work regulations that are going to have two be returned, staff but have to get up to speed on new products? >> are congress and the administration has been very supportive of increasing the cftc resources in the past few years to meet these additional responsibilities, both in terms of the current contracts and continues to increase as new product with the legislation, which requires financial new resources. i believe that's in our budget

request. so it's a very real concern that the agency have adequate resources to undertake these new markets with within existing authority as well as the new authorities that we make after the legislation. >> thank you, mr. chairman. i yield back. >> the chair recognizes the gentleman from florida, mr. wallace. >> thank you, mr. chairman. and well-trained to get a handle on here and i think it's an interesting discussion and important one. the need is always there for financial instruments innovation and trying to balance those things out. i'm interested to hear from mr. jacob said, kind of the impeccable timing of bringing up in this environment, but i think that's the nature of it and we have to be able to hear that. the questions i have been watching this and trying to understand not just on the shoe,

but a little broader. you see yourself as a passive pass-through to make sure the rules are enforced exactly as you interpret them or do you see yourself to anticipate potential problems and be more proactive against this? i'm kind of getting the feeling it seems to me and this may be the proper bowl. i'm trying to understand that it's passive, but the rules may fall within the rules so we've got to do it. >> i would describe it as a very active enforcer of the rules that we have. we have the rules and we have to follow the rule. we try to be very good anticipated and looking ahead to avoid problems, rather than simply looking behind. >> i want to make sure that i fall in the right side of this. do you see it -- is it the appropriate role of the cftc to determine if there's a need need for this product? or is that for the market to determine those folks coming to you? >> that's not within our purview to determine whether indeed there is any going on.

>> okay, so that might be at the heart of this. what's up for an alt.? but asking you to do that is inappropriate to put you in. is that correct? and my summing up right quick >> that's not something that is criteria are proving these products. >> i think while struggling with this and it may be a simplistic question because i'm trying to understand this and trying to understand the definition. it don't want to go down the road that the president did at one point on a pejorative towards las vegas, but there's a specific reason for that and i am trying to understand how this is different than a wager. i say for example, is this a bad example as something like the minnesota vikings, they field a team they put together is very futures trading on how well they do this year? is that different or without a wager to determine whether they win the super bowl or not? >> has not penetrated.

>> is it different from definition? is a difference in the movies features. you've got a product coming of investors and you can buy into the studio right now. you get on a regular exchange of the big worry. you can do all that, but the performance of it tends to be based on more of a wager because of all these factors people about a period that's what i'm trying to understand that this is the appropriate place for this. i think you would be appropriate for me on what i know as a casual observer of movies to that which ones are going to hit big in which one third. but that's wager he seems to me. i don't know. i try to get from your expertise on this. >> we don't really approach -- we don't really approach the question from that date. somebody comes in with an application of those who would like to trade a contract for future delivery or an option on

a certain commodity and i look at that application. we are good and whether indeed the contract with the statutory standards, whether it's acceptable or not to manipulation, whether there's appropriate limit again in the integrity of the process. and so, we do a very arab accurate review of that death is presented to us. >> so you're operating inside the frame or curative and i think that's probably appropriate. i think some of these questions are for the next and all. i thank you for your patience and willingness to help us understand this. i yield back. >> thank you. the chair recognizes mr. trader. >> thank you, mr. chairman. i guess i'm biased because i'm one of them may be few members that does not worship at the grill of liquidity and derivatives in the suggest body of ours and while i appreciate what you do in the cftc has a stellar record, it's going to take some convincing to me this is a good idea. what i've heard so far is going

to be fatuous to pass this legislation creep another onion exemption. but i see this as ripe for manipulation. i see no overriding public interest in the fall. frankly the people most affected don't like it from what i've gathered. so i guess we'll hear more about that going forward. and to be honest, gentlemen, it would be sheer folly with the most riveted crisis they have seen with creating another instrument, when the public is owing to see is frankly legalized gambling. i think the person that votes for this to be absolutely insane. but maybe i can be convinced otherwise and i look forward to the rest of the testimony. thank you, mr. chairman. i yield back. >> thank you. mr. markowitz, at the university of iowa, the business offers the iowa electronic arcade while originally created as a teaching school for students, this market is now open to nonstudents and includes trading and election futures from presidential races

to control of congress to individual races. so i'll markowitz investors limited to $500, but it is a market nonetheless. the iowa electronic arcus operates under no action letter provided by the cftc with the cftc says it will not take action against the university for offering political futures contract on their exchange. it seems to me that elections contracts with many of the same concerns we will hear from the next panel he had what is the price discovery for a change service the contract provides? with the ability of the pedestrian insiders in the case of elections that would be posters, consultants, media, using their knowledge to manipulate these market. and what is their utility. for example, is elected official ever going to short his own election in granting the relief in the electronic arcus to the cftc look at these issues and why are these markets provided?

>> my understanding that this was originally done by or is being done and overseen by the university of iowa as an academic and a research -- a research undertaking. thursday dollar limitation on it. it is being supervised by the university. it's my understanding it's not for profit as well. under those circumstances, the cftc granted that no action letter to enable it to operate. the questions that she praised, in terms of the broader beyond iowa are questions that does concern the commission. in 2008, the commission issued what's called a concept release, sort of like a discussion paper in the federal register notice inviting public comment of them at the very questions.

what should the commission's position be with respect to what they call prediction markets, where you can predict the erratically the outcome of an election for other events. much of the regulatory position towards these market be? should we have a knack of rolling like futures contracts are they inherently different from futures contracts? we have numerous public comments on that and we are still reviewing that issue at the commission. >> any other questions for anybody? seeing them. thank you very much for sharing and we like to excuse this time and invite the other panel to take their place. [inaudible conversations]

[inaudible conversations] >> thank you, gentlemen. we'll go back through each of you to make a statement if we could and will last if you can conserve the five-minute rule and would like to hear from you, then we'll have an exchange of questions. so we'd like to start off with mr. jacobs, president of cantor futures exchange new york. >> thank you, chairman boswell, rigid member brandon members of the subcommittee. i am richard jaycobs, ceo of the

cantor futures exchange. we've been working on box office receipts over two years, but it wasn't until the last four weeks that we received any attention at all the subject. and i welcome the opportunity to help alleviate the concerns and put into proper context and what were building how it works and what benefits can be achieved through this. i like to emphasize three points about the economic purpose in the integrity of futures contracts on box office receipts. first, for the private and institutional investors who have invested up to eight to $10 billion of private money and films for my futures contracts can be an important risk management tool just as they are agriculture, energy and other features. they'll make more capital available at lower cost method result great american jobs. second, cantor futures contracts are the basis upon which many decisions and commitments are made by establishing this exchange, a market mechanism is

created to provide independent judgment of that anticipated revenue and against participants in that market and others better information. for example, screen allocations by movie theaters, distribution for distributors can be initiated in the full transparency of the price. third, the regulated futures exchange, we observe all market activity to gather at the national futures association and the cftc we have proper and prudent safeguards against manipulation. cantor exchange takes the integrity and transparency very seriously. our company was founded in 1945 and has extensive capital market experience. chanter supports this committee's efforts and goals for financial regulatory reform through greater market transparency, competition and centralize clean for financial markets. were proud of our law and record and a reputation as a caring corporate citizen in the aftermath of the 9/11 tragedies

good week of our nation's financial crisis and debate on financial risk aren't any new financial product clearly should come under scrutiny. since 2000, cftc has designated more than 10 exchanges with creation of over 1000 new contracts. as an experience next for regulated the cftc is well-equipped to consider the public utility of futures contracts and ensure that any proposed futures contract for public policy, anti-manipulation of their requirement of law. the contract will not proceed with a 50 c. approved legislation on this is not needed. the npa has said that futures contracts are not legitimate, they could not mind a form for gambling on their acceptable to manipulation. these are inaccurate in overreaching statements. the revenue generated by millions of moviegoers can determine directly from the polish reports of distribution or estimate from the electronic salesw# records. initially they use the box numbers released by the studios. however, the accuracy of the