there's only two ways to do this. cut spending and raise taxes. and the right place to start is on the spending side of the ledger. there's no point in having taxes if you don't have spending. but what people don't understand or what hasn't sunk into the public debate yet that 70% of all spending is on one of these five items, social security, medicare, medicaid, defense, and net interest. all right? and people can talk about foreign aid, welfare queens, the department of education, the department of commerce, whatever you want, whatever your favor bug-a-boo is about totally eliminating those type of things would in the have much effect. if we want to focus, we need to focus on the items. if we didn't mind cutting net

interest, we wouldn't have to worry at the deficit in the first place. defense, social security, medicare, medicaid. if you look at those four, it's going to be very hard to do a lot on those. medicare and medicaid, there's enormous health care fatigue. the republicans are talking about trying to pull back some of the health care plan. but that certainly is not going to happen with obama in office. and it seems doubtful to me that it would happen even if the republicans took over in 2013. social security, when it was on the table in 2006, it maybe back on the table now. there was general agreement we were going to grandfather everyone in. if that still holds, it means we couldn't cut spending by a dime, even if we cut social security now, in the 8th year would be

the first year of retirees that would be affected. the likelihood of getting much spending reduction out of social security is not there unless we are willing to go after current retirees or near retirees. that maybe a very tough political nut to crack. defense spending, i should have mentioned earlier that the -- in the extended policy where the deficit is going up to 6% of gdp or more by the end of the dedicate -- decade that has obama's baseline defense plan. the reason that i did that, the baseline defense plan has bigger cuts. obama comes in $300 billion lower than baseline over the 10 years. there are already cuts built into defense in the budget forecast that i showed you. that doesn't mean we can't cut more. but there are already some cuts

built in. so these spending options are only 65% of gdp in '09 because of the stimulus and t.a.r.p. and all of that. they are on a path to go up to 80% by the end of the decade. even with the cuts in defense. the other four are rising. if we want to cut spending, we need to focus not exclusively, but mainly on one the big four or five items. actually, let me just mention prudent risk management right now, i think would make net interest payments go up. the reason that i say that is right now we are financing an enormous portion of our debt with short term securities. we are rolling it over every 90 days. at the same time, we have long-term rate that is are higher than the short term rates, but are still very low relative to historical rates.

there's a strategy that says the federal government would try to lock in the long-term rates and stop boring at the short horizon. if they did that, my guess is they would save money in the long term. but rates and cost would go up. interest payments would go up now. just to make it a little hard tore deal on -- harder to deal on the spending side. all right. that leaves us with taxes. again, i think the right place to start is spending. we need to turn to taxes. there's a joke about an inmate in a jail who's eating dinner. he says to the inmate next to him, boy, this food is really lousy. the other one says, yeah, and there's not enough of it. that's sort of the situation that we face in the tax system. we have lousy taxes and we need more of them. formally, we need better taxes and more revenues as well.

there are three main ways to do this. that would do minimal damage to the economy. none of them involved income tax rate increases. that's probably the worst way, if anything, we should be trying to cut rates by broadened. the first area is tax expenditure. the government does an enormous amount of things in the tax code that basically our spending items disguised as tax cuts. if i described a government spending initiative to you that gave people money depending on how big their mortgage was and the bigger their mortgage was, and the more income they had, the more money they got from the government, you'd say that is ridiculous; right? if i said let's cut the mortgage interest reduction, oh, no, that's bedrock for american society. but that's what -- that's how the mortgage reduction works.

that's how a lot of the other deductions work. in income reform, we did not remove the exclusion -- the nontaxation of employer health insurance. so that was the mistake as far as health insurance was concerned. but it leaves it on the table now for deficit reduction. there's a significant amount of money in reducing tax expenditures in the income tax. the two other areas that i want to mention, one is energy taxes. we need -- energy is the classic, dirty energy, classic, fossil fuel energy is what we all learn about in econ 101. we are not taxes carbon, greenhouse gas emissions, i think this is an area though where the perfect could be the enemy of the good. therfect approach -- the perfect approach here is a carbon tax.

which would raise revenue, impose the right incentives, et cetera, the next best would be the cap-and-trade system. although there's the worry that the auctions -- the permits get given away. if we do that, my view is we can give away all of the permits this year and next year as soon as five or seven years from now, we are not giving away any of them. i don't mind the transition. i just don't want a situation where we are permanently giving away the permits. because that cuts into the revenue, that loses the incentive effect. even if we can't design a carbon tax or cap-and-trade we still have a good option. which is the good ole gasoline tax. there's a lot of move in the gasoline tax. every dollars raised about 1% of gdp, and .8 once you adjust for the offsetting affects on other

factors. what that means raise the gas tax for a quarter a year for ten years, the added tax would be $ $2.50, that's a lot of money from a relatively simple tax that has good environmental qualities. my view would be we should raise the gas tax like that. if we ever get around to a carbon tax, fine, we can use some of the revenues to reduce the gas tax. we shouldn't let the perfect be the enemy of the bad here. the other is value-added tax. we're the only major country that doesn't have one. again, there's -- if i want to -- if you need to raise a significant amount of money of value-added tax is the way that most countries do that in addition to the income tax. let me just say a word about the fiscal commission. their report is due in december

1. they have 18 members, 6 congressional democrats, 6 congressional republicans, 6 white house appointees, their job is to eliminate the deficit, other than interest payments by 2015. so that basically involved getting the deficit down to 3% of gdp. supposedly the deficit in the absence of their policies would get the deficit down to 4%. but my calculations, they have about -- that would mean they have 12% of gdp to go. by my calculations, they need to come up with 2.2% of gdp. because the extended policy outlook is worst the obama policy. there's going to be very difficult for them to do. they've got a rule that in order for it to be a consensus report, they need 14 votes. but six of the members have signed no new taxes pledge. which means they are unlikely to support a program that has any tax increases, which means it's

unlikely the other 12 is going to support a program that has only tax cuts in it. how this is going to get resolved is a really good question. what's clear is we've gone from the notion that congress can solve this on their own to the notion that congress is going to have a commission solve this for them. i think -- we'll see -- all right. i'm going to read the report when it comes out, if it comes out. but it seems unlikely commission is going to support a plan. even we had a crisis that forced our hand or we don't. we need a forced decision, a set of outcomes at a time when it doesn't have to. and the system is not good at that.

let me stop there and saying i'd be happy to take questions and i appreciate your attention. >> thank you very much, bill. >> maybe in a few questions, i'll start with one who came in on a card. the person that admits that is a provocative question, fair enough. italy's debt is over 100% of gdp. 110. japans debt is just try of 200% of gd. i think the implied question is big deal. how would you respond to that? >> japan is an interesting case. that doesn't seem to work the way other countries do. one is they -- they seem to owe it almost entirely themselves. there's also an issue with gross debt versus net debt.

the way they calculate is different, and sizably different, because they have a number of -- sort of like government saving institutions that lend back and forth. so i'm not -- and, you know, we could end up like japan is not really a comforting outcome. i don't have -- you know, i don't think of that as a counter example. italy is different. italy has always had a much higher saving rate than we do. and i don't know enough about the italian debt situation. but the real issue again is not the crisis aspect of this. it's, you know, if the question is japan and italy hasn't had a crisis, you know, why should we worry about a crisis, i don't

think that's the right question. other countries have had, for two reasons. other countries have had fiscal meltdowns at levels that are lower than, for example, japan as reinhart and rogoff. they show you can get all sorts of debt to gdp ratiod. the other issue is we are basically living above our means. the deficit is a reflection of that. the capital flows and the trade deficit is a reflux of -- reflection of that too. that's the case, regardless if there's a financial meltdown or not. >> just on italy, much like japan, a lot of that debt is actually held internally as well. i think that does set both of those countries apart from us to some extent. this one is actually a question for me. it's a more positive view. a number of countries in the

'90s were able to reduce their debt to gdp ratio substantially. sweden being one, canada the other. just curious if there's any lessons from those experiences that might be relevant to us. >> yeah, there certainly is. a number in the '80s and in this decade as well. in the '90s they benefited from the worldwide economic boom. which helped. there are a number of countries that have imposed consolidation plans. mainly, they have been smaller countries that had to. that's one lesson that we need to figure out a way to make us have to do this. we were talking about, you know, too big to fail on the last question, the fact that we are so big and people are willing, you know, we have a financial meltdown, we exploit it to the rest of the world. they send us funds. it's a crazy system.

we are benefiting from it. it will almost be better in some days if we didn't. anyway, the lesson from the consolidation literature. it's that spending cuts tend to be more progross than tax increases. which is not surprises. also, where places have cut spending is entitlement and government wages. we don't have the government wage option to cut. these countries -- at the federal level. if you look at the amount of money that these countries spend on public sector employees, it's much higher than we do at the federal level. you'd have to go to the state level and lay off teachers and firemen and policemen, and stuff like that. so the federal employee angle is not helpful. the retirement angle, you know, of course, would be. and i think a lot of people would like to do that in the

medium term. it's not going to be easy. >> we're going to have bob reischauer tomorrow talking about health care reform. let me kind of -- it was one the questions that was asked. clearly one ski issue is rising health care cost. so, you know, it's not that you dismiss it. you didn't spend a lot of time on that. i'm sure you thought a lot about it. i'm sort of curious what the choices are, what's realistic in the context of what we have going right now, the new health care laws. >> okay. i didn't emphasis this -- i didn't mention this at all. but there's a sort of view out there that the fiscal problem is just a health care problem. not that health care is easily fixed. if we just fix health care, we'll be fine. i think that's wrong. and the numbers that i show you through 2020 basically explain why. that's not fundamentally a health care concern between now and 2020. it's just an imbalance between

what we are really to raise in revenues and our overall spending. it's after 2020 in the long term that health care really kicks in. we spend more time talking about the long term deficit. we could have talked more about that. but the health care problem is layered on top of this already large fundamental imbalance. >> all right. we are just about out of time. let me thank you. and everybody join in thanking you. very interesting discuss. you laid it out in a really nice way. i really appreciate it. thanks a lot. >> you're welcome. >> going to take a 15-minute break. become here at 4:00.

[inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] >> a record 37 governships and congress at stake today as polls are across the country. c-span's election coverage begins at 7 eastern. we'll show election results as they come in along with victory and concession speeches in key races. also your reaction to tonights events through phone calls, e-mails, and tweets. you can also follow election results online at c-span.org.

results will be posted as soon as they come in. but you can go there now to see what political analyst are predicting for tonight. president barack obama reacts to the election results tomorrow when he holds a news conference in the east room. the white house says the president will take reporters questions at 1:00 eastern. c-span will have live coverage. >> c-span student cam documentary is in full swing. washington, d.c. through my lens, your document should include more than one point of view along with c-span programming. there's $50,000 in total prizes. the competition is open to middle and high school students. for all of the rules and how to upload, go online to

studentcam.org. >> next a look at recent announcement by ford that they will invest $850 million in michigan which will likely create 1200 new jobs. from this morning's washington journal, this is 25 minutes. >> the government and community relations vice president with the ford motor company is here to talk to us about jobs in the auto industry. first the headline in the "free press" about ford investing $850 million in michigan, creating 1200 jobs. explain to us how it's going to work. >> thanks for having me, especially on election day. must be nice to talk about something else. the announcement is fabulous. fabulous for michigan. it's great for the economy. we are putting $850 million into the state of michigan. a lot of it centers around building fuel-efficient six speeds there. it's a really good story.

1200 jobs. you also considered how many jobbed are created in the community off of those 1200 jobs, it's significantly good news for the state. >> host: these are transmissions that are going to go in cars also produced in detroit? >> guest: yes, and other places as well. it's a new fuel efficient 6-speed transmission. we are proud of as we continue to do more and more to make our vehicles more and more. >> host: how did ford come to make the decision? >> guest: well, it's interesting, rob. there's a lot of competition these days for investment. it's competition that we see, state versus state, nation versus nation. investment in manufacturing is real good news for state economy, local economy, and so we went through a process where we worked with the state of michigan to line up investment incentives that would help make for better climate for

investment in michigan. >> host: when you say investment incentives, what do mean? >> guest: we were looking at the size, $850 million, we were looking to see through the tax structure, the right climate and partnership to make michigan a great place to do business. as it is. >> host: so we're talking about tax breaks. >> guest: tax breaks, yes, and primarily related to the tax issue. >> host: how big are the tax breaks? if you weren't doing it in michigan, where might you have gone? >> guest: you don't want to speculate, i'd say it could be upwards of $400 million over a period of years. i think the period is probably about ten years of incentives. >> host: we're talking with ziad ojakli of the ford motor company. we're going to go over issues related to the jobs in the auto

industry. if you'd like to get into the conversation, give us a call. independents 202-628 -- as always you can send us e-mails and tweets. ford motor company has 63,000 >> host: it's also expected under the $850 million program, 1200 jobs will be created. focusing on transmission and components. this will occur over the next three years in the detroit metro area.

how soon do you plan to have these facilities up and running? >> guest: the investment will be beginning next year through 2013. the specific investment in michigan. i'd also mention it's the second significant investment as we made as of late. we had a $950 million investment in turning a truck plant into a car plant where we make the ford focus. a lot of good news for michigan and other states coming out of the ford motor company, investing in america. >> host: our first call for ziad comes from michigan. carrie on the line for democrats. >> caller: hi, what i'm wondered, are you going to calling back laid off people, doing new hires? what are your requirements going to be? how will that work? >> guest: good question. first call will be on rehiring some of those who were displaced in the work force.

those are about 1200 positions. 900 are hourly, 300 salary. >> host: carrie, you still with us? okay. andy on our line for independents. a.y? -- andy? >> caller: yeah. >> host: go ahead. >> caller: how's it going? >> host: what's on your mind this morning, andy? >> caller: yeah, i wanted to ask the person from ford with global competition the way it is, how is he -- the ford motor company plan on competing with the high labor cost in the detroit area? >> guest: thanks for the question. first thing i'd say is working with the uaw, we came together on an agreement which allowed us to lower the cost of labor and be more competitive. we still have a ways to go. we are on a plan and a path to be more competitive as far as labor cost.

another related way we compete globally is ford motor company is a big exporter of vehicles. we look for opportunities wherever we can find them. in fact, our new explorer which is coming out of chicago. another investment that we've made recently, $400 million. that vehicle will be exported to 90 countries. a great success story for exporting out of united states. >> host: the article in the "free press" talked about transmission in sterling heights, and also says >> host: tell us what is the

michigan economic development administration and how does ford work with them to get the 1200 jobs out there? >> guest: it's a great group created under the governors leadership. we work very closely to figure out what's going to attract investment in michigan. looking again at taxes primarily, but other ways to incent investment. it's a very affective partnership. kind of a model for other states, i'd say. >> host: next up is new jersey. paul on the line. >> caller: hi, good morning. this is wonderful to have new that is ford is going to hire 1200 new jobs in this economy. i just wanted to say it's sad that it almost took this company to go bankrupt and the other american car companies to go bankrupt to realize that they let foreign car companies set the trend on longer warranties,

better mileage, and towering reliability. so i was wondering what ford is doing these days to meet those competitive demands and again all backed on the great news that ford is going to be hiring 1200 new jobs. this is fantastic for our country, especially michigan. thank you. >> guest: thank you for that. i can say it is fantastic news. it's great to hear. jobs being -- jobs and investment in the united states, announcements to that. we know we had a tough road go. we are proud that we had a plan. we are executing a plan. we are doing it without the precious taxpayer assistance from a few years ago. i'd say each of the areas in competing with foreign automakers we are best in class on safety, fuel economy, we continue to make improvement year over year.

we're very proud of the story right now that ford is telling. we're doing this all on our own. that's the question. >> ziad leads a team that helps promote policy and legislation, including areas of energy, environment, tax, international trade, and improvement in the nation's health care and pension systems. that's quite a lot of different aspects on your plate. how does the current health care and pension system -- how's that going to play into this new program, this new $850 million program? is it going to -- is it going to cost more for the company to do that? >> guest: cost more on health care? >> host: yeah, on health care. >> guest: right now, as it relates to the health care bill that came through, we are waiting to see what the regulations look like in order to make an assessment there.

i'd say we were able to again working with the uaw on our transformational agreement. we were able to come to a way to have trust set up to have retiree health care taken care of. we've done a lot on our own and with our partners to be able to bring cost down at ford. >> host: next up, charles on the line for independents. your on the line for washington journal. charles? >> caller: yes. >> host: you need for you to turn down your television, okay? >> caller: okay. >> host: do you have a question or comment, charles? >> caller: i have a comment. >> host: go ahead. > caller: i had a question. well, first of all, i think it's great that's ford is hiring the 1200. yes, i own a few thousand of shares of ford motor. i don't get a dimes worth of dividends. can you tell me when ford will start paying dividends again?

>> guest: i can't answer that question. i think that's best left to others to answer. there's a reason they keep me here in washington and away from the finances. >> host: next up, maryland, dan on the line for republicans. good morning. >> guest: -- >> caller: good morning. i wanted to make a quick comment and ask the guest to respond. : time ago improving dramatically the quality of their products. and as you know, we went through the financial problems over the past couple of years. ford motor co. did not take any money from the government. and now we see the new products that they are announcing this week. i want to get back to the source of driving of the problem -- quality improvement. my question is, in the mid-1980s

when you sat down with the ford motor co. and all of >> caller: i know ford took a lot from that and they made improvements in their culture and business where other companies like chrysler did not. can you comment on those impacts and i'll listen off the line, thank you. >> host: dan, are you connected to ford motor company in any way? >> caller: no. i'm with the department of defense and do engineering. >> host: okay. thanks for your call. >> guest: great observations there. probably the biggest factor was to go on a plan, to have a plan and execute on all the areas ring not just quality, but on fuel economy, safety, and to make sure that we continuously improve. it also helped that we decided to, part of the plan, a central part of the plan, was to focus on the blue oval and focus on ford.

we had a lot of other brands. we were a family of brands. we had volvo and mazda and aston martin and that distrected from ford and lincoln. all of those together was making sure we had a plan and stuck to it and executed it. >> host: who is mr. deeming in playing a role? >> it is somebody who has written extensively on continuous improvement in the business world, and i think though i underscore it was coming up with a game plan that put the focus on all of those areas mentioned that was the most important going forward. >> host: from missouri, john on the line for democrats. >> caller: yes, i have a comment about the guy that i think he called from new jersey talking about competing with china.

the thing is we need to quit worrying about competing with china. there's no way to compete with them, and we need to focus on just getting us back to work, and, you know, let the rest take care of itself. >> host: one of the things that just to draw out of that is i think we're at a place in this country now where manufacturing matters again. it's important here in the united states when you look at manufacturing it's millions and millions of jobs, about 70% of the rnd from this country comes from manufacturing. we're in a teachable moment where all parties and elected officials are starting to recognize that importance that manufacturing gets the economy going again. we at ford look forward to playing a role on that. >> host: sheila, democrat

line, you're on. glk -- >> caller: good morning. i'm a senior and you had someone on the program saying how many seniors or how many people reach the age of 65. we have two cars. i have a cay car and basically we've been both driving a ford -- i forget the name, but it's a way gone, and -- wagon and whoever around our age sees this car wants to get one like it, and ford stopped making it. wagons are much better for people our age, and it would be a big seller and my other comment is that on c-span when the other companies chrysler and

general motors went to ask for money from the federal government, ford agreed that it would help them if they got money; is that correct? did that help ford keep the business that the other companies did get loans? >> guest: first of all, thanks for being a loyal customer. if you like that wagon, you'll like the flex which is a new product or a crossover, the ford edge. thanks for being a customer. on helping gm and chrysler, we were very supportive chrysler getting assistance from the federal government. we all share a supplier base of 70% of the suppliers are in

common. if one company went down, the supplier base could have had a knock down affect on the industry and led to significant job loss in a time when this country could afford it least. we were very supportive of helping gm and chrysler, and we were pleased at the same time that our plan allowed us to stay away from the emergency government assistance. >> host: the lead story in this morning's "wall street journal" talks about gm's sticker of $50 million. the u.s. cuts ownership stake below the 50% to 35% when the car maker relists stock later this month. according to new figures the company will disclose on tuesday, but it's tough for the government to break even on its investment. give me your thoughts on the situation with gm, why they had to go this route opposed the

route ford went, and where does this put the two companies, ford and gm, in the manufacturing automotive production market? >> guest: i won't pretend to understand what in the decisions at gm. all i know is about ford. we had our own plan. what we did is we took out probably the biggest home improvement loan in american history. it was $23.5 billion. we borrowed when the markets were still lending money and put up our assets up as collateral, even our trademark blue oval. that allowed us to haved funds necessary to get through the crisis, but also to invest in the future, and we're seeing those products come out. i have our plan, i would rather

not comment on their plan. i wish them the best, not too much, but they are good competitors, and we look forward to competing with gm, chrysler, and everybody else. >> with this new $850 million investment, is there going to be much construction, new construction involved with this? building plants to make these transmissions and other parts, or are you going into facilities that are already up and running? >> some if terms of construction the majority of it will be in existing facilities. there's a lot of work to be done to retool and get ready for the transmissions. >> host: greensberg, pennsylvania on the line for democrats. tom, you're on the line. >> caller: thank you, c-span for taking my call, and i'm glad to hear ford added 1200 new jobs to

the detroit area at least for the transmission plant, and, yeah, i have fords. i have quite a few, but through the years, and i still got a 71 ford pickup truck because i still drive once in awhile, and i tell you what, that's one heck of a truck, but, yeah, i need to know if you're going to do anything about the seats in the new ford and that real sharp angle on your wind windshield that slants the roof back. i'd like to see you change that a little. make it maybe look like the 61 thunderbirds that you had where they were pointy in the front and they ran great. like i said, i owned a lot of them through the years, you

know, and i tell you what, keep up the good work, but i'd like to see the lumbar support seats go and the wind shield that goes in your face. >> host: tom, how long have you had the truck? >> caller: 18 years. >> host: if you replace it, will you buy another ford truck? >> caller: oh, probably, yeah, i like my fords. >> guest: come see me when you trade that in. i'll take your comments back and i appreciate you being a customer, but i'll tell you, the new f-150 is just absolutely out of this world. there's a reason it's the best selling truck in the world. it's phenomenal. >> caller: good morning, and thank you for taking my call. my question for the gentleman, is when are we going to see a

purely hydrogen, 100% hydrogen vehicle? i'm sorry? >> host: no, go ahead. >> caller: i still see the three major car companies in the domestic car manufacturers continue to use 100 year plus technology in a combustion engine, and i'm in the market for a new car, but 35 miles a gallon is not getting it for me. until i see an automobile that uses an alternative energy source functional for me, i'm just not going to buy. >> guest: thanks for that question. i'd say at ford we're very focused on making sure we provide all the choices for our customers. we're not banking on any one technology. i think way we're looking at is the whole gamet from electrification with five vehicles coming out in the next years that are full hybrid or

plug-in vehicles or full electric vehicles to alternative fuel vehicles. we have several million on the road right now that are capable of taking e-85 to hydrogen which we continue to work on both in terms of the fuel cell which is longer term to the hydrogen and internal combustion engine that we're doing a lot of work on and have tom vehicle -- some vehicles out on the street being tested. the problem with alternative fuel vehicles is the infrastructure that needs to be in place, and that's something that we have to work on very closely with the federal government in particular to make sure there's the infrastructure. i'll give you the example. on ethanol vehicles we have probably between the three companies, gm, chrysler, and ford, we have 5-6 million vehicles on the streets, but there's only 2,000 pumps that are able to do e-85 ethanol, so

that's an area where, i think, we need to focus public-private partnership working with the federal government. >> host: and al there has to be a certain amount of demand -- >> guest: absolutely. >> host: in the marketplace. do you see that now or on the horizon that more people come into the dealerships saying i want a hybrid or an electric car? >> guest: it's a small percentage now, 2% of all the vehicles out there. sure, i think if the infrastructure is there, if the cost coming down and we continue to improve in the battery technology, there's a lot of factors consumers and consumer credits or a tax incentive, but all of those need to be in place for i think consumer demand to increase. >> host: how much support do you see on capitol hill for a tax inventive like the one you talk about? >> guest: there's strong

bipartisan support. there's already one in place, but there's strong support for doing something on the consumer side and figuring out how to do more on battery technology in the united states. there's a lot of interest in that because the one thing we can't do is trade dependence on one source of energy on another if our batteries are made overseas. >> host: next call is from waycross georgia on the line for republicans. go ahead. >> caller: does ford plan to invest natural gas components for industrial fleet, agriculture and marine investigations? if not, why not? >> guest: we continue to look across the board. we're not picking one technology over another, but we're looking at all the technologies to see which are most promising. some are more in niche markets,

but we're looking at everything. >> host: next up is ohio, carroll? >> caller: yes. >> host: go ahead. >> caller: i'm carroll, my and husband works at the ford motor plant, and i was -- and they -- i need to turn the darn tv down. >> host: yeah, turn that darn tv down. >> caller: they are doing the ecoboost engine, but i was disappointed that they closed the factory and he's been there for 17 years. i have relatives that have retired from ford, and their health plan is different than the health plan for the ford retirees in other states. why is that? you know, i mean, they have to

pay most of their doctor bills now where if you live out of state, you don't have to pay that, you know, and i was just curious about that, and thank you, i'm so glad ford is still here. thank you. >> guest: well, thanks for being part of the ford family, and i know with respect to the foundry, tough decisions have been made over the last couple years and tough decisions to make the business work for the long term, work and become more efficient and meet the consumer demand, on the ecoboost engine that the caller mentioned, this is just great. i mean, it's -- we're putting these engines on a lot of our products, there's 20% increase in fuel economy, and it's really helped us meet the standards or work towards meeting the standards on fuel economy. on the health care question, i'm sorry i don't know the answer to that question, but if you leave

your number or contact, i'd be glad to look into it. >> host: blogs talk about transportation in the white house putting out fuel efficiency standards for heavy vehicles and says in may 2009, president obama broke a deal with the auto industry that saw the corporate average fuel economy or cafe standards rise for the first time in years requiring auto makers to meet a minimum of 35.5 miles per gallon by 2016 and carbon cap and trade and other climate policies need the the cooperation of congress and a tougher gas milage standard was something the congress could do on their own. from your perspective, is there any truth to that statement that it was easier for the administration to, you know, demand or ask for these cafe

standards because of the downturn in the automotive industry right now? >> guest: i would say in the case of ford, we were leaning forward to work with the government and find the right standards and road map to take us threw and increase fuel economy. it wasn't an adversary relationship. i think the agreement by president obama and the administration is a good one that takes us through 2016. why it was so important to us because we have one standard to follow. it takes years to plan your next vehicles. we wanted to have some certainty in the equation, and prior to that deal, all the states could have their own laws, and we had basically a fragmented policy. having one pollty, a clear direction, and it clear number was the right thing to do. now where we need to go is look beyond 2016 to set a road map

further into the future. i'd say one other thing, rob, when you look at co2 reduction and working towards energy independence, i think the auto industry has more than given here. we're the only industry that's been restrained in this way on co2. what we hope for in the longer term solution towards energy independence or co2 reduction is that everybody gets to sit at the table, not just the auto industry. >> host: next up, ohio, herbert, indpint line, you're on. >> guest: yes, hello? >> host: hello. >> caller: good morning. i'm a ford man first of all, and i just am driving a 2010 ford. i love it. ford xlt four-wheel drive. i guess my question is here is i know i'll get my news off of

yahoo, and i've seen on this you're building or it's in the plans of building a $5 billion engine plant in china. i mean, is that true? >> guest: as far as the exact number i'm not sure, but we are expanding our operations in china. we have several facilities in chong and other cities, and we have products that fit that market well and that market is growing. we look forward to selling more and more vehicles in china. >> host: there's an article talking about the president hoping to rally the republicans on a south korean pact, and it says the administration is under heavy pressure from ford motor company and the united auto workers to win new concessions from south korea, the second

largest exporter of vehicles to the u.s.. winning support from ford is particularly important for the administration since the company was the only one of the big three u.s. auto producers to deny a bailout during the auto crieses. this would be a tough l sell for the administration because obama has touted his support for the auto sector as an example of his economic accomplishments. your thoughts? >> guest: exporting is an important part of our business plan moving forward, and as i mentioned the new ford explorer is a great success story. the problem we have with this agreement is there's two big problems. first of all, if this agreement were to pass in its current form, it would bassically just have one-way trade. the trade is coming from korea to the united states, not the united states to korea.

korea is the most closed market in the world, only 5% import concentration into korea and the united states is 40 plus. we're free traders. we're practitioners of free trade. we see this as an opportunity if we open the korean market to sell our vehicles there. the other big issue is if we have a bad agreement on the auto motive provisions in the agreement, we're going to sew that replicated in other places meaning if the chinese or the indians or anybody else seeks a trade agreement with the united states, they're going to demand nothing less than the korea got that is one-way trade. we need to pry open the most closed up market in the world. we're glad the president and leaders in congress are supportive of that position. >> host: next call from

topeka, kansas on republicans. sir, i'm not going to try your name. i'll mess it up. go ahead, please. >> caller: all right. we should be more interested in making jobs at the local level to help bring back money for the people so we can restore the economy. also, does your wife have contempt towards you because you prematurely -- >> host: let's move on to democrats. >> caller: thank you for taking my call. my concern is why don't ford put diesels into their passenger vehicles? diesel engines get more miles per dpal lone than gasoline and the infrastructure is there. truck drivers use diesels, and there's a number of people using diesel. as a matter of fact, i called a

representative of your company and asked them to put a diesel in the edge, so if i could get answer to that, i'd appreciate it. >> guest: that's a great question, and i'd say that on diesel technology, we're pursuing a lot in terms of clean diesel technology. the reason why you don't see it here frankly are the rules that were written overtime that don't provide diesel the same level playing field as other technologies. i think that's changing. diesels have fantastic fuel economy. you see it in europe where diesel technology is dominant, but there's absolutely room more for here for diesels here and ford is working towards that end. >> host: before going to ford motor company served president george w. bush for legislative affairs, the president is chief

liaison to the u.s. senate from 2001 to 2004, and in this role he managed daily interactions with the white house with u.s. senators, assisted in strategy development and coordinated strategy with add min straitive agencies and departments. back to the phones. illinois on our line for independents, brian, go ahead. >> caller: first i'd like to thank ford for being a responsible business in trying to do what's good for the consumer and the community. i do have a question related to the car companies in general, but directly to ford. can innovation get us to a point where we will get gas milage of 60 to 100 miles to the gallon with, i guess, oil-based fuel, algae seems to be a, at least an interesting new source of

potential like fuel supplement, is there any way ford could lead the way in bringing new fuel efficient cars without necessarily relying on new technology? i mean, the carburetor, outdated technology, but with heated fuel in a carburetor, you get amazing gas milage, that may only be long distance travel, but i'd like to hear thoughts on that. thank you. >> guest: thanks for the question. our philosophy is continued improvement on fuel economy whether it's looking at other technologies we talked about earlier or looking at the traditional combustion engine, and ecoboost is a perfect proof point of the technology that is scalable and it increases fuel economy by 20% over previous engines.

we'll continue to look at it, and we'll continue to find ways to be more fuel efficient. i would say in that regard and you'll see this from our focus in other vehicles, we're best in class across the board. >> host: from oklahoma on our line for republicans, mike, go ahead. >> caller: good morning. hey, i'm a ford owner, i have four of them right now. >> guest: bless you. >> caller: i'm sorry you guys are missing the boat on the crossovers or new station wagons. you made the focus in a wagon form up to 2006, and i had one and i'm sorry i traded it in, but all you have now is the edge, and it's a round town milage is in the teens and it's fairly pricey. what's the plans for getting an economical crossover or station wagon? i hope you have one. >> guest: the edge and you did

mention the mkx, the lincoln counterpart which is absolutely a fabulous vehicle. i would say those two are doing very well in the marketplace. you also have a little bit bigger vehicle in the ford flex which is a dynamite vehicle for families, what we're dedicated to at ford is to provide the whole family which is small, medium, large, trucks, cars, utilities, across the board for every consumer's choice. we'll continue to work to that end. >> host: governor jennifer granholm is coming to the end of her term. tell us about the two gentleman running to replace here, and what you see in the future of the relationship between state government and ford motor company moving forward. >> well, we're always -- we're proud of our home, mirs, but we are --

michigan, but we're located in other places around the world. one is a businessman, rick snyder who is the republican candidate, and ridge, the mayor of lancing, the capitol of michigan is his opponent. regardless of what happens, we have a strong working relationship, and we look forward to that continuing. >> host: on the line for democrats, go ahead, larry. >> caller: yes, i just wanted to thank ford. my family worked at the cleveland complex for three generations. i've had my grandfather, father, several uncles, cowsens, and six brothers that all worked at ford. i will be a ford man until the day i die. thank you very much. >> guest: thanks very much, and for being part of the ford family. it's stories like these that

just -- it makes you feel so proud to be part of ford motor company, and to be actually right now producing jobs in the united states, investment in the united states, and being part of the economic recovery to come. >> host: have you started taking applications for the 1200 new jobs produced by the 850 million? >> guest: rob, i'm not sure. i think we're still in the process, and it's only been a week since the announcement. >> host: bill on the line for the republicans. bill? >> caller: yeah? >> host: are you there, bill? >> caller: yeah. >> host: go ahead. >> caller: i was wondering when the unions will get it in their head their overcharging for everything they do in the workplace, their vacations, their retirements, and that's the reason jobs are leaving the

united states of america is all on account of the union charging so much for their labor work. >> guest: i would say this. we have a lot of partnerships that we work through at ford. one of them that's critical is the uaw, and we're glad that we came to an agreement with the uaw to bring down the cost of labor to work on issues of health care and make us more competitive, not only in the united states versus other companies, but around the world as we look to export products from the united states. there are a lot of important partnerships, the uaw is one of them. our dealer network, our ford store owners, our suppliers, ford treasures relationships with all its partners and do the best job we can to be

competitive throwed throughout the world. >> host: thanks for being on the washington journal. >> guest: thanks, rob, thanks for having me. a third of the senate and states are electing governors. coverage begins in an hour at 7 eastern with results from across the country and your calls, e-mails, and tweets. president obama reacts to the election results tomorrow when he holds a news conference in the east rom. the president will take reporter question at 1 eastern. c-span has live coverage.

>> over the next 45 minuteses, the chairman of the house science and technology subcommittee on energy and the environment, brian baird talks about how terrorism and wars changed the u.s. and muslim societies. it's part of a day long forum on the future of u.s. foreign policy. >> tom, it's agreed to see you with us today. terrific. let me talk about brian baird.

congressman brian baird is from the third district of washington state. he sits on the transportation infrastructure committee, house committee, budget committee. he just published a book entitled character politics and responsibility. before he came on to take these duties on, he chaired the department of psychology at lutheran university and was a practicing neuropsychologist. i'll tell you the other side of brian baird. brian has become -- he's leaving congress. he's here, definitely happier than anyone else i've seen in congress, and it's an honor to have him with us. he's a close friend of the new america foundation and mine, and works with us everything from big questions on what's going on in the economy to how this country needs to rethink or think about foreign policy

portfolio and national security questions, and he is a brave person. he's gone to areas of the world that, that we were just say were on the edge. he was the first person in gas gaza after that crisis in israel, and he's challenged and tried to bring intellectual challenge to some of the important debates that congress has had. he played a vital role in the health care debate which he was one of the leading critics for awhile of the health care plan and ended up supporting the president's plan, but used his position i think honorably in the way congressmen should which is to wrestle with the great ideas and not get swept in one current or another. without further adieu, please welcome congressman brian baird. [applause] >> good morning, everyone. steve, thank you for the kind introduction, and i have to say

one the most exciting developments in this city in many, many years is the new america foundation especially on topics relating to the middle east. if you name the topic, some of the most out of the box comprehensive thinking comes out of new america. steve is at the front of that. bob, i think you're right with the money on this effort as a former siling -- psychologist. the idea that we try to understand what motivates people makes a lot of sense. i want to share with you a funny thing that happened on the way here today. truly, it did. i bumped into my dear friend donna ed words from maryland, a fantastic member of congress, we served to the on the science committee. donna shared with me the following story.

she's been asked to speak to a group that has policy that supports a two-state solution in israel an palestine and said if two-state doesn't work, we might look at the viability of a one-state solution. donna has been asked to talk to them, and she then gets e-mails say, no, you can't talk to those people. if you talk to those people, then we may not be able to support you anymore, and she said, well, wait a second, the other grume in town, apac does that? why can't i talk to people? i may be speaking out of school here. this is a conversation in front of starbucks, but it is literally 10 minutes ago, but it is indicative of part of the problem we face. it's a town that imposes group think with a fer rosety that i i was irving who wrote that book.

it imposes it in a host of ways that liement how we think -- limit how we think. i want to challenge that a little bit today and we'll have q and a. one of the fundamental core problems seems to me how we define the problem at hand. terrorism, i think, in most of our minds in congress is often implicitly. intriguely enough, we don't stop and ask what it means to wage war on this. the assumed definition is something horrific and unjustified that happens to us for no good reason. there's so many limitations in that definition that prevent us from solving the problem, something horrific is valid, something unjustified is questionable. now, you cannot say that.

you cannot say that it is worth asking is there ever justification for a terrorist agent. i do not think there is justification for a terrorist act, but the people who engage in them certainly do, and it is worth us asking why they do that. it happens to us, but what about all the things that happen to others including some of the things we do? we are not allowed to ask that in this town either. six years ago or more than that, senator patty murray, up for reelection this year, was talking with a bunch of school children, post 9/11, not long after, and they asked her, why do people do this to us? she said, well, here are some of the differences. she tried to give those young people a perspective from the other side. what happened? somebody had a video camera in

the room, and she was apologizing for terrorists. it was a major issue, but she was trying to teach school children to understand terrorism in a different way. the challenge is members in congress have group-think enforced. if you go to certain country, you get demerits. if you say certain things, you get demerits. if you meet with certain groups, you get demerits. we are just supposed to march lock step with administration or with ideology or something else. it's not going to work. there is a comedian of arab diesels sent who has a joke and he's asked where do you get suicide bombers? he said, oh, the suicide hotline.

now, it's pretty funny actually if you think about it. you call up and say, i'm thinking of killing myself. you know, that's not such a bad idea, but let us recommend a methodology. now, it's a funny joke except that as in so many good jokes, there's a grain of truth to it. here's the grain of truth i take from it. as a psychologist i understand that behavior makes sense. we may not always agree with it, but in some ways it makes sense to the person engaging in it. part of the job of a psychologist and the job of our foreign policy must be to help create conditions in which alternative behaviors make more sense. there's a famous psychologist who reversed the direction of how we look at child abuse, and as a parent of 5-year-old twin boys, i understand this well. we look at child because as the anomaly. if you really think about it,

anybody who has had children has at least more than once wanted to throw them down the stairs. now, of course you can't say that because we're always in love with our children and they are angels and never get upset. the amazing thing is there, not there there's child abuse, the amazing thing is it's not rampant. anybody who has young children gets it when you have to get up at 3 a.m.. if you have the desire you're better than me, but maybe, you're not honest. it's difficult and it's a mild example. in terrorism this is something you can't say. in some instances, in some conditions that we contribute to the creation of a fair question is what other response would you expect? what other response would you expect?

when we engage in activities that create indignity, that impose suffering on civilian population, that deprives people of freedoms, that support totalitarian regimes, some response will occur. terrorism is one manifestation of that. now, ironically, we often say, well, there should be an alternative and promote nonviolent activity. indeed, we should. take palestine that i'm familiar with and if you look at the resumés that talk about terrorism, steve mentioned i spent a lot of time in gaza and to my knowledge more than any other official, and what else would you expect if you see the conditions on the ground there? the amazing thing to me when i visit gaza and the towns

encircled by walls in the west bank is the indignity, integrity, and the passion for compassion that the palestinians manifest. they are dead-set against allowing their children to fall into the trap of december per ration that leads to terrorism and they are courageous people. you meet the doctors, leaders, business people, working their hearts out to say we have to give these kids another alternative. i talked to a clinical psychologist driving with his 8-year-old son down the road when the car was vapor rised and the people in the car died before his child's eyes. a few weeks later the son was disrespondent, and this palestinian psychologist asked his son, what's the matter? his son said i want to be a

suicide bomber. his dad said why? he said we're all going to die, i want to take someone with me. this is not a child raised with death, but he was not going to go see virgins. this child was 8. his life experience gave him a sense of hopelessness, that this seemed to be the most viable alternatives. again, we say you should look at nonviolence. i met with a palestinian leader a month ago, an advocate of nonviolence. what's happening to people who engage in nonviolence? they are imprisoned without trial, beaten, and the world is largely ignoring it. if you want to change behavior, you have to have a viable

alternative. if you suppress the viable alternative, what else would you expect? i suggest we need to make sure that we first address the conditions that can contribute to the december -- desperation and second we support alternatives, and then third on the other side, i think a cold hard reality is also necessary. what i said so far sounds like what you expect from a psychologist and democrat. there are also really horrible people in the world who ideological, pathologically enjoy killing other human beings. they have to be killed. i'm sorry. but i think it's true. we probably have to be prepared to cope with both realities, and we're terrible in congress and

public in this in dealing with both realities. it's easier to say everybody involved in terrorism is like the latter sort or they fight us because we are all bad. no, there's people who are horrific human beings with destructive ideology as we see it. they seek to impose that upon us and the rest of the world, and we have to stop them, and they don't mind terrorism because they think it's part of some personal or divine or political mission, and we have to confront that reality as well. to the degree we address the first set of issues i described, we will be much, much efficient at addressing the second because far fewer people will fall victim to the second. i'll close and open it for questions by referring it back to the institution i serve in, the congress. increasingly, i'm afraid, it is harder and harder and harder in

political life to engage in this kind of dialogue. those of you with flip phones i'm thankful not to see them here, but i think c-span is covering it so i'm toast anyway, and if you read my book, a shameless plug, i'm toast anyway because the stuff i say in there is way out, but you just -- you have to be able to look at things objectively and there has to be a constituency that values that, a constituency in the media, a constituency in the public who says i may not agree with this person, but i'm glad their asking the question and making me think in new ways. instead, what happens is people pander incessantly and the best way to get the media is pander more than the other guy. i think newt gingrich engaged in that in the mosque to name names in the mosque issue. it's a perfectly fair question

to ask if we are to allow a mosque when the 1st amendment says we should, is it not fair to ask what other countries if they would allow christian churches or synagogues. that's a fair question and and essential one. how you ask it means everything and why you ask is it more important. so too i think it's silly and counterproductive and counter to our first amendment, but at the same time is it not fair to ask why can my wife not walk down the street of islambad without being spit upon? those are fair questions, and we need to ask both sides of that. the political pleasure is to only go with one side or the otherment on the left, it's disagreement on how awful it is

to fight against the mosque, but it is only fair to say wait a second, there's other countries that are more intoller rapt to be honest, and we need to confront that as we confront our own, and so the challenge is the last thing is this, terror is not something that just happens to us because external people impose it. it's a psychological response at the end of the day. back to the palestinians again. what astonishes me is they refused to be terrorized. they don't let it happen by and large and their leaders and many, many others. they have been through hell, they had bombs, smart bombs, tanks, and they hang in there. we need, i believe, while we address the other issues to internally adjust our mind set to this reality. for some time to come despite of

the efforts and massive defense capabilities, we're going to get hit from time to time. this city will get hit again. some of us may die. whether that creates terror is up to us. we have to address that. we have to not promise people that under no circumstances whatsoever will somebody slip through because they will, and they will kill some people, but how it affects us is under our control, and we need to think very sobberly about that and maturely about that because otherwise the terrorists will not win, but they will succeed in disrupting our way of life and the very values we hold dear and that distinguish us from them in the most constructive way possible. with that, let's have questions. >> thanks, brian. thank you very much.

thanks for your candor. i won't say you're toast if you run again, but it's not to get a dose of candor and hear somebody talk about resilience. [applause] i want to ask you one thing. i'm a blogger, and i notice a tendency in the blog as of late whether you write in the middle. right, or left, for folks to engage in something that has bothered me a lot traveling through the middle east, and what i see in the middle east is a kind of currency and conspiracy theories, and the use of conspiracy theories to rationalize what people see as to what's going on, an an awful lot of effort in the middle east to try to research or organize or filter what they see through this, and i see this coming to this country in part becoming a part of our own dialogue and discourse in a way that is almost a rejection of empirical

rejection and an approach to looking at things, and have you thought about that as a politician who has been knocked around a lot for some of the things that you've done, but, you know k maybe we need another book, bob, to study what that is rather than talking about it. i'm writing about this now, conspiracy in the united states and how this is such a feature how we report and filter and people associated, people who speak on the podium, and how that is becoming the domination of more and more of our political discourse. if you have comments on that, i'll open it to the floor. >> you hit on a real problem especially i think. it's true on the left and right interestingly enough on the extreme. i loathe president obama as a fascist, but people said the same about president bush on the left in a different way.

i've been in the receiving end of both. there's a quality at a timive dirch, but the whole issue of is he turning america into the muslim socialist nation, why can't we just say i disagree with the man's policies? there has to be something deeper in part because that then justifies the craziness itself. if you said i disagree with the man's policy, fine, engage in political activism. if you believe in this darker force, there's a fundamental, i think a fundamental human need among many of us to be heroic. you want to be a hero. movies are not about average guys, but heros. there's a desire to be a hero, save something, to do something big. terrorism is a good way to do that if that's your desire. it fulfills that need. you can put it all on the line

and blow yourself up as bob studied, but it's even better if it's a big evil conspiracy you're fighting. if it's just a guy you disagree with, blowing people up is harsh, but if there's a big conspiracy, you're fighting for the truth, the way, and life against the dark forces of evil, and that's a better fight. >> thank you. this gentleman here, we'll run a microphone over to you. by the way, i will say that group think i talked about reenforces that pair know ya, the idea you look at the other side and see what they have to say, that's the beef in addition. -- definition. >> i am founder and ed forof a new publication that intends to have multidisciplinary debates and dialogue. it's set up by a bumpleg of us

who -- bunch of us from oxford and hope to bring that dialogue that you talked about. very qukly, i did special ops against the taliban. i appreciate the comments you make. my question to you from an international perspective, a lot of the hate spoken in america seen as represented of america, and the question from me to you is how do you mitigate that considering it's international ramifications especially to people who do propagate these theories and run the suicide schools? >> first of all, we don't get credit for the good things we've done during the -- this is a personal example. during the time we had a young bos kneian student, i don't say that for personal appreciation, but the fact is the united

states thought the genocide there while europe looked on. we get almost no appreciation for that, and we did it at a marginal loss of u.s. lives on the ground there. the work we did in indonesia and the united states and the pakistan earthquakes and ect. and ect. and the list goes on, in afghanistan, the amount of effort u.s. soldiers and leaders put in to troy to avoid civilian casualties is atonnishing. i have seen classified images of drone strikes and they didn't pull the image because there was a child in range. a guy who killed hundreds and hundreds of people. we don't get credit. contrast that to the soviets who

deliberately targeted civilians. on the one hand the media doesn't give us credit for the good we do, overemphasize the mistakes, and don't look at the contrasting conditions around the world. having said that, there no question that our engagement in the middle east in israel and palestine and i say this as a proud friend of israel is harming our security and israel in the long run. unless we reconcile that in a constructive and just way, that will continue to be the focus for many people. i was in the swat valley in pakistan right after it was cleared out, and we were meeting with people and i was ask what their thought was about going into waristan. the other issue one guy said,

why should we fight against other muslims begin what you do in pal palestine? it was the swat valley. it is injust and counterproductive from a security perspective. >> other questions? we're still getting warmed up here. one other question, brian. you talked about the indonesia and deputy john allen who ran an operation and ran it extremely confidently. ..

of that. i will tell you in a rather paradoxical way, u.s. aid years ago under bush made an effort to brand down the pens, the little button or stripe on the pen that said a gift of the american people which naturally support, but interestingly enough the most controversy allegiance we pulled our usaid stickers off, the goal being to give the credit to the local government in power the local government. so we ourselves have been sort of downplaying what we've done. the second issue is in pakistan there's so much as we know so much corruption and a

questionable use of funds, so i'm not sure why more has not been done but we've also done quite a bit in pakistan with the flooding as well. >> right here. >> thanks, steve, thank you, a congressman. i am a security adviser, and i could not sit still when you talked about phasing with realities of the very bad man in the face when they are walking up with a suicide fest on approaching my control point with children giving candy to. the reality behind that, we have -- it's very sensitive. there's a lot of things we can't say in the group think of d.c. and america in general. the word arrogance comes to mind and is used a lot of times by writers who try to address how we are affecting other cultures. when you spoke to come and you said what else we expect them to do when we support these behaviors, the indignity and so forth? so, the previous question from a special operator -- ayaan retired still, and overseas in iraq and afghanistan more than

i've been home the last decade but i also right on peace, a powerful piece, and addressing the reality that the more we use the heart of power, the more we bring the hostility in return. we invite the negativity and the negative energy. how do you see it as the base level working out? because we've information operation strategic looking down but i think we need to engage people like us that have the double perspective all across the world. >> thank you. two things, one strategically in the field tactically we are using the teams that are finally getting at the concept. ironically as some of you know the academic community is criticized. these are anthropologist's, sociologists, religious scholars who go to the field to try to understand the humans. it's been extraordinarily effective and saved a lot of u.s. civilian and enemy lives and brought people from the other side over. so in the field we are finally

getting that general petraeus is a huge advocate of that and i've met many times with these folks. actually had the first joint committee and special lops subcommittee of the house together on human teams because i think it's essential. that, however, is yet to fill up to the congress of large, the issue of smart power, soft power, and the reason is a variety. it's easy to attack somebody, you know, here is the attack ad and by the way when i finish this job i will do voice-over work but it does something like this, what our soldiers need better on tests to protect from artillery. , brian baird wantedd the money on anthropologist's. [laughter] you get it. you've been in the front and to come to the village and said i don't know who to shoot. >> there are a lot of political consultants here. >> i don't know who to shoot and i would rather not shoot anybody. i would rather talk to somebody

if i could and we haven't done that well the lawyer levels and one of the paradoxes, too, is the other thing that has to happen is colleagues not only have to have the courage to look a different sides to open their eyes when they go over. when i was in iraq and came back i opposed the invasion. i think it was a terrible mistake but once you're there you have a moral obligation to not just leave children to get their heads cut off by the al qaeda butcher which is what was happening. and i came back and said we were making progress and would be a mistake to pull out. i think that was the right thing to do but it wasn't as easy as the democrats to vote against the conflict but the troubling thing is you have colleagues who going to the theater knowing what they want to see. so you have to people see the exact same thing come back and report exact opposite things. and i think it's because of how we go in. we go in with a preset and then we have the political -- i've had colleagues say to me back then you may be right, but i don't want to say it.

well, damnit if it's true and it's national securities and lives of the line, suck it u. people are dying, the least you can do is have integrity to look at things with objective eyes and tell the truth as best you understand it. >> this gentleman. >> thank you. my name is tony berman. ayman al jazeera head of strategy for the americans based in washington. until a month ago i was the managing director of al jazeera english and i've been back in north america, located here for about a month, and my first week back was the week of the florida pastor aftershocks of the so-called ground zero mosque. so my question -- one thing i found somebody that is kind of free engaged now in north america particular the u.s. is the incredible shrill level of the debate. and i guess i find your whole fema what is the environment here open to rational

alternative approaches is a serious one. what is you're i guess your own thinking as to what the driving is coming and are you hopeful or confident once this he election is over with in november that the temperature will lower and that there will be more of an openness to looking at alternative approaches to the problems we all face? >> thank you, tony. >> thank you. i'm not super optimistic and the reason is there are a number of factors contributing to the upset. first of all we did get attack on september the 11th and by muslim extremists. you've got to acknowledge that fact ma that that represents all of islam, the dow was at least a part of the motivation of the people who attacked us and that resonates still and you have to be honest about that. second, on top of that we have a

terribly faltering economy. a lot of unemployed people. 20% of my congressional district uncertain towns and they don't know what's happened to them and it's a global environment and they have seen their sons and daughters and mothers and fathers get ticked off of a faraway place to fight a war mike it isn't clear anymore to many people what it's all about. and they want the world to be what it was. it's not just what was before president obama. it's what was forced to relent. i mean, really. and why can't you make it go back there? why can he make the economy be what it was when we had gone from a couple hundred million dollar deficit to a surplus? why can't you make that happen? why can't you go back to the five, 7% unemployment etc? well, all of those things are deeply distressing for understandable reasons and there is an undercurrent of anger that then gets targeted and a

convenient place to target is out, so you out members of your own country whether it is president obama, nancy pelosi, somebody else, but then you out the foreigners and in the most obvious case are islam because they look different, they worship different, they talked front, from different countries, and there is a link to the attack and all of that is really hard to turnaround. remember earlier said it agrees that to get the alterman and nonviolent. when is the last time you saw a major western news story on nonviolent resistance? nonviolent resistance. there is a civil rights era. my good friend, john lewis was getting pounded from the bridge. mao was national news and a troubled the american people. we do not add our own country see that there are extraordinarily courageous people on the ground throughout the middle east -- and that's not just palestine, israel, that

is within the other countries that have a totalitarian regimes trying to bring about change in a non-violently. that would create i think some better empathy with those folks especially if you tie it to the islamic scripture that is part of the motivation and again, not all of the nonviolent activists are muslim. there are many christian activists as well and many jewish activists of course as well over there. so, getting the different perspective, and then i think, i actually think their needs to be a loud voice among moderate muslims in the united states of america. i really believe that. i think there has to be a greater global condemnation of extremism and they are out there. there are people doing great work. jim and many others of the american arab american institute, but it's not getting the kind of coverage. so the american people don't have a person to identify with. if you were to ask the american people name when muslim anywhere

on earth who advocates long silence, couldn't do it. >> we chief of naval operations still coming down. he went in the wrong entrance of the capitol. there was another question over here the finest. >> yes, right here. if you could find the microphone right here. this leedy in the center. lady not in red. >> i'm retired colonel and homeland security for the state of illinois, and my concern as we recently had a young lebanese american who wanted to bomb the ridgely area, leave at night. no motivation. it wasn't and a christian or anything like that. he had his own screwed up reasons, and you brought up an excellent point. how are we going to counter terrorism without curbing our own terror especially against the population, and that does concern me. i'm hoping to hear ideas today. but anything how do we prepare the public's we don't turn on

our neighbors? cpac excellent. thank you very much. >> the short answer is you need political leaders to douse the flames and the reverse is happening right now. for political opportunistic reasons if i could be more extreme than you and condemn the other side as somehow being soft and thereby make you feel good by association with me and more powerful it is an age-old tactic and it works and we have to call those people on it and some are not callable because their agenda is different, their agenda is personal power and some flat and disagree with that and make a difference of ideology but there is a set of people who are pretty darned cynical in their use of this issue and i think you need that moderate sensible rational voice and i think the media needs to become infected al jazeera and the arab world, because, you know, they will put -- they will

put -- was that guy got well for something? he had nobody down in florida and suddenly this becomes international news, they are burning the koran. well, that is a nutjob. he's not worthy of international news or representative of america. but he's easy to family other side as well. so what has to happen is a louder voice, not loud in terms of volume, but being present from the people in this room and from our political leaders and we need to call them on it. we need to have people who go to town halls and say to the demagogues on either side look, you know, it's not just what you're saying i disagree with, it is why you are saying that, and how you are saying it and what its impact is. have you thought about what you're doing to the problems and that is a tall order. we have to somehow communicate that that's actually a better

approach. that's actually the fundamental approach of a space constitution of america and we have to communicate that but it is extraordinarily difficult. i personally believe, and i am a big a student of the founders. my one side is william washington and the other is walter franklin and i can't tell you how many biographies. i don't think any of them could get elected today. franklin was a vegetarian abolitionist, and he enjoyed recreational pursuits as well as france. [laughter] you know, washington didn't want to engage in the fourth military entanglements, etc., but we need states and again and i hope we can achieve that or we are in great trouble and we will not cut them off unless we have. >> well we are having fun, you're not going yet. our naval chief went to the cannon house office building. so that's why some of --

>> but let me ask you -- there may be other questions but i want to ask you -- we will go to tom pickering but i would like to reverse it on the congress relationship with the executive branch and can we get a microphone over to the ambassador pickering while we are doing this? one of the things that interests me is tom donnelly on his way to becoming national security, and i wrote a piece this week saying that one of the characteristics i see in this administration, the executive branch and want to ask because, may reflect on it as well as sheldon whitehouse is how to compete with other branches of government that it ought to actually be running in other words i said in and is bidding gary coming is the pentagon actually works for the white house the the national security council staff feels it is often competing with strategists in the capacity that exists on the pentagon and i'm wondering for the commercial perspective how to use your branch surviving were floundering or not doing well, visa vv executive branch but before you answer me that the

ask the comments. >> you were kind enough to refer to me and the hyperbolic fashion. congressman, think you for your frankness and the directness and your willingness to let most of it hang out if i can use that perverse expression. mine is a companion question one that you perhaps for good reasons is steered away from where to press that bipartisanship is that unknown science and the forgotten history up here in particular. what could be done to resurrect it or are we in the hopeless process of having partisanship be the watchword for the e turtle teacher? >> thank you. tom, by the whitcomb has been a champion of something i also think could be helpful on this and that is the science of diplomacy. the use of science, and tom and i talk about this and championed on the committee. if you look worldwide, one of

the things we are most respected for is the scientific and technological progress and openness of inquiry that allows that to happen. and i believe bringing scientists together in a tecum -- internationally -- you can go to iran and say you've got something in fact there are u.s. physicians and researchers there as we speak i believe working on that. so those kind of things, tom, thank you for your work on that and many other issues. on bye partisanship, to other things. the first would be non-partisan commission is to establish commercial,, andres. it is destructive to the system and creates a secure districts on both sides and frankly in general the secure districts in my experience are less able to work with some of those folks knocked out in the primary if and there are exceptions to that. or because they are so absolutely convinced their ideology is 100% right. now that is problematic in the house and lethal in the senate

because an ideologue who is certain he or she speaks with some the divine inspiration than anybody else, the filibuster in holder can really dumb things up, and that then creates a lot of tension and it doesn't -- the issue is i want you to come my way a little bit, it's my way or the highway and the highway then gets grid locked. second thing i believe is campaign finance reform and i struggled with this. if i could do one thing in life would be to say we will establish public funding, we will ban all independent expenditures by individual candidates and an independent expenditure above that gets matched. but no candidate can spend or raise money themselves because it curled see. it takes away your time, takes away your sole and raises conflicts that are not unattainable become untenable. for their expenditures come, public money goes against them and there would be instant public acknowledgement of who is funding the ad. you know, free speech is a

cherished value but it's not free if you have to sell your soul to engage in it. >> any quick reflections on how congress is doing visa vv executive branch restoration? >> yes, i think the congress has undermined president obama's efforts to move forward on peace in the middle east. i think -- i don't believe we are going to successfully be able to settle the issue between israel and palestine unless there is serious pressure coming from the white house and from the congress and i think the congressional picture has either overtly and or covertly meeting in private backdoor conversations said to people don't worry we are not going to do anything of substance if they don't stop the settlement and if you don't stop the settlements, you do stop at two state solution, geographically it can't work. the settlements continue to expand you're not going to have a viable test solution and if you don't have a viable tuesday solution you are either going to

have -- these are apartheid or nondemocratic states. just yesterday israel enacted a law that you have to take a loyalty oath that says your loyalty -- israel is a jewish state. there's a lot of christians and a lot of palestinian muslims and others living in israel, but to take a loyalty oath not just, you know, i pledge allegiance to the united states of america, but to a particular religious ideology which is prescribed in the first line of the first amendment of the united states constitution bill of rights. but now our number one ally in the region is saying you have to adhere to israel as a jewish state. i think that's going to be counterproductive, and i personally believe president obama kaine, gave one of the best president's speech is a u.s. president has ever given and created a high expectation most of which have been unfulfilled, and i will finish with this story. and gaza after the bombing we need three children, boys.

we left with no security purposefully, we just wanted to meet people. please is blown up -- by golly, hear couple couple of 13-year-old boys. they have their arms around them, their pals. one comes up in broken english introduces himself. we sit where did you learn to speak english? he ressa television? he said no, shakespeare. this is a true story. shakespeare? i love shakespeare, real-time. let me introduce my friends. all of this broken. first friend, just had a new nephew bourn, guess the name of the nephew, three weeks after, barack obama. third from, wonderful boy taking care of his family, attends mosques. why do you build rockets? people come to our villages with bombs and drop tanks on our buildings. but also i going to do? what do you want to do with your lives? first boy, i want to be a

teacher. secondly, i want to be a physician, the one that had a nephew and barack obama. the third bullet, i want to be an engineer. none of them said terrorists. the question for all of us is how to get those kids to be teachers, doctors and engineers when so much of the earth around them is putting them in office under actions and i hope we can get that answer in the discussion today. >> briant, thank you very much. thank you. >> a record 37 governorships and democratic control of

now airforce and chief of

staff general norton schwartz talks about efforts to maintain the air force in iraq and afghanistan. we will also hear about recent moves by defense secretary gates on pentagon spending. from the national press club this is an hour. [inaudible conversations] >> good afternoon and welcome to the national press club. my name is john donnelly, senior writer at congressional quarterly. i cover defense, also vice chairman of the national press club board of governors. the national press club is the world's leading professional organization for journalists, and we are committed to our professions future through our programming and by fostering a free press worldwide. for more information about the press club, please visit our web site at www.press.org.

to donate to our programs, please visit www.press.org/library. on behalf of members worldwide i would like to welcome the speaker and attendees of today's event which includes guests of the speaker as well as a working journalist. i've also like to welcome our c-span and public radio audiences. after the speech concludes, i will ask as many audience questions as time permits, and i would now like to introduce our head table guests. starting from your right. and please, stand when i introduce your names, john danner, chairman sierra and native american communications. [applause] please, hold your applause until the end. thank you. joshed rogan, who writes the cable, a lot on foreign policy national security that appears on the website of foreign policy magazine and the washington post. stephen trimble, reporter with flight international.

jim michaels defense reporter at usa today. andrea esa, a defense correspondent for reuters. christopher costely, editor inside the pentagon. andrew schneider, associate editor of kiplinger washington editors and chairman in pc speakers' committee. skipping over the speaker for just a moment, donna leinwand, usa today reporter and former national press club president. john baird asger of aviation week. kristen corner, a reporter who writes the magazines on the move section which tracks high-profile personal moves in the nation's capital. kristen is a member of the national press club. rodrigo valdiron mog, a member of the national press club board of governors is an independent op-ed writer and managing director of plantation international llc come and vic iii of the alliance could director at morgan stanley.

in june, 2008, the air force was in trouble. relations with congress, the defense secretary and with the other services were strained for a variety of reasons. there for a multibillion-dollar refueling tanker program beset by scandal and other woes was grounded. calls for amounted to stop playing the costly f-22 fighter jet and most significantly, air force personnel recently lost track of nuclear weapons in transit. defense secretary robert gates had enough. he ousted the air force secretary and the chief of staff. the new choice for the air force chief of staff was the general norton schwartz, who is today's speaker. in choosing general schwartz, president obama engaged and wanted to signal things would be done differently from now want to read in every with the past, schwartz was the first air force chief who wasn't a fighter jock or a bomber pilot. instead, he had flown cargo planes, helicopters and aerial gunships.

from day one, schwartz made clear that stewardship of nuclear weapons was dropped one. but he had had a lot more than that on his plate. for the air force is in many ways a service in transition. many of the air force's aircraft need to be replaced at unfortunately right about the same time, roughly over the next decade. the new weapons costs have to be kept under control. meanwhile, pay and benefits for the approximately 680,000 military and civilian personnel in the air force are devouring an ever larger share of the budget, in fact health care costs in particular are engaged in his words, eating the defense department alive. at the same time the country needs to grapple with the mounting federal debt. with half the appropriations congress controls ever you're going to the pentagon, military spending, including the air force's more than 110 million-dollar annual budget, is expected to be on the table for cuts. now as the budget must show its operating efficiently just like the of other services will. must make the case for its

relevance. general schwartz, who is a native of toms river new jersey has extensive experience to draw as he confronts these issues. before becoming chief he ran the u.s. transportation command charged with altering his military logistics. he also served as the deputy commander of the special operations command. he's been in the middle of several wars, starting in 1975 when he was a crew member in the 1975 airlift evacuation of saigon. today is the air force chief of staff, general schwartz is a member of the joint chiefs' staff. he provides military advice to the defense secretary and the white house. we are very pleased to have the chief with us today shined a light on these issues, and so please, give a former national press club welcome to the chief of staff of the united states air force, general norton schwartz. [applause] >> thanks very much for the kind

introduction. it does go back over a bit of history, which is behind us i think. but i would also like to thank the national press club for hosting but i think is a very important even, and it certainly is my honor to address this audience for the first time. i thank you for the upper kennedy to share these thoughts and hopefully to add to the public discussion in which many of you all play a very important part. ladies and gentlemen, i have a quote that i think is interesting, and it goes something like this. old international patterns are crumbling. old slogans are an instructive. an old solutions are unavailing. the world has become

interdependent and economics and the communications and in human aspirations. now these are the words of a prominent statesman, dr. henry kissinger. and while that might not be surprising that he would share this particular sentinelle what his perhaps more interesting is that he made this statement not recently, and not even in the last decade, but and 1975, as the united states secretary of state in the speech titled "a new national partnership." he was stating the then as it is now geostrategic complexity constantly evolves. remakes itself, revealing new patterns of cooperation, competition and conflict. while this mantling old paradigm that has guided our priorities

in decisions over time. therefore, all of the geostrategic interconnectedness is itself nothing new, i would suggest today that the current manifestations that we face certainly are. and they are presenting profoundly unfamiliar challenges. the rub is of course we can only estimate the nature of the future threats, the capabilities of the potential adversaries, or the typography of future operating environments. we are not afford it and never will be complete certitude about such things. and as we continue to be faced with a trillion dollar deficits and compounding national debt, our purchasing power in the department of defense is likely

to diminish. and this means that we cannot just come at substantial financial investments to prepare for an infinite variety of contingencies. for our nation's military this suggests that we must be more flexible across a wide but far from infinite range of contingencies and more versatile and efficient and everything that we undertake. the need for versatility means among other things that we must balance today's needs with tomorrow's challenges. in the likelihood of france and the severity of the consequences, informed of the decisions on how we prioritize, how to balance, and for what to

prepare? we must carefully anticipate the teacher requirements and implement selective and incremental approach of modernizing of legacy capabilities. essentially acquiring a limited capability systems has stopgaps where necessary and procuring next generation technologies where fiscally possible and responsible. the greater versatility that we require is enhanced broadly by the inherent speed, range and flexibility of air and space power. with this, we are able to respond to different will tie spectrum requirements and leveraging the disadvantage of the family business of the united states airforce, to which i will return and elaborate a little bit here in a minute.

so in addition to the first title means, we must also be more efficient in our process and procedures and in our operations. an important strategy is to reduce overhead operating costs, create more savings and shift them directly to the force, structure and modernization and war fighting needs. being more efficient also requires more interaction and interdependence between the u.s. government organizations, toward a whole of government approach including joint and interagency within the executive and legislative branches. for example, admiral garrey rauf head and i are fully committed to a more robust navy air force partnership. currently known as the air

seattle, where we create efficiencies and collaboration to ensure our nation's continued ability to project expeditionary power. the air-sea battle will focus on three levels of a joint cooperation between the nation's to strategically oriented and globally postured military services. first, institutionally with dedicated constructs that normalize the navy and air force collaboration. number two, conceptually with institutional agreement on how the navy and air force systems will integrate and operate together. and third, material. with interoperable the among the current systems and integrated acquisition strategies for future joint capabilities. the air-sea battle was won

promising way in which we will further increase our team work, enhance our joint partnerships and amplify our joint effectiveness, making it that much more difficult for the potential at for serious to keep pace with what is already the gold standard of the inner surface cooperation and collaboration. indeed, the united states air force as a proud a joint partner that will look to further enhance the ways in which will make its enduring and central contributions. first and foremost, airmen provide control of the air and space over our homeland, and wherever friendly forces operate. and they ensure freedom of action in all domains by minimizing the threat of attack

from above. in modern warfare, such control, even when it localized, is a prerequisite for success. and because freedom of action in any more fighting domain increasingly depends upon control in one or more of the others our efforts increasingly include a measure of interrelated control of multiple the mechem air, land, sea, space and so on. second, the air force of leverage is the air and space control as well as mission insurance in cyberspace to bring the desired affect to bear on the most serious challenges to our vital one trust. the airmen provide global vigilance, breach and power he, the ability to see and rapidly

get to and create the desired affect almost anywhere on the plan at through air and space power, speed, range, versatility and flexibility, which are inherent, unmatched, and undisputed. there force and not uniquely but substantially translates these inherent characteristics into rapid, precise, to a third more fighting effects as required by our combatant commanders around the world. and as we continue to do everything possible to prevail in today's fight, we are also vigilant for emerging threats and anticipating associated requirements. the air force will therefore continue to identify the ways in which air, space and cyber

forces and cyber power can further bolster the collective capability of the joint team. most recently, we've seen a rise in air force specialty operations, halgand personnel rescue, joint tactical control remotely piloted systems and intelligence surveillance and reconnaissance from both air breathing and earth orbiting systems. we are very proud of our airmen and have a couple here today who are being trained specifically for these rules as well as non-traditional duties such as convoy operations, installation security and free construction of the war-torn regions but we also continue to provide our core contributions and precision strike. tactical and airlift support.

i should say tanker and airlift support. spaceborne communications, early-warning and precision navigation in timing. and of course so much more and we remain vigilant and ready for the fruits of today's security environment. we are cognizant of the possibility of higher and larger scale conflict for as the near pure competitors and potential up-and-coming adversaries increase the capabilities they may seek to challenge us in ways that will require a somewhat different mix of air force capabilities in response such as what we provided for example in operation allied force over ten years ago. we would hope that this could be a verdict, but in the meantime our guiding principle will be to

continue to stand with our joint and a coalition partners and deliver the fullest possible range of the air and space power affects. if we were able to look forward to budgetary growth, or less urgency for more discipline spending, our task of accommodating this on certain future would be much easier as we could just invest more money to assure a wide range of capabilities and greater operational flexibility. but the reality is defense budgets will likely continue to flatten even as we contend with rising personnel costs, operations, sustainment and acquisition costs as well. even with declining purchasing power, we still have to do more

with the same or fewer resources, squeezing every last bit of capability from our current and future weapons systems. to do this, we will continue to be innovative with our tactics, techniques and procedures and employing our various capabilities in an ever widening array of settings. in short, we must be more efficient, a versatile and flexible with both the ways and means at our disposal, to create the buyer taylor and decisive year and space power affects that are the trademark of your air force. we are proud to make these contributions to the collective strengths of the u.s. military. which are -- which allow the nation not only to prepare for

future contingencies, but to us by year to prevent the war as well. our efforts to prevail in conflicts have the accompanying the effect of enhancing our deterrence posture and ability to this incentivize the escalation of crisis to the conflict and conflict into a large scale war. as we look to the future, control of the air and space, holding out risk, practically any target on the earth, intelligence, surveillance and reconnaissance, airlift and command and control of a year and space capabilities will remain the air force's most fundamental and most enduring cord contributions. let me just repeat that. because i think it is worth repeating.

control of air and space, holding the risk practically any target on the air services. intelligence and surveillance and reconnaissance, airlift, and the command and control of air and space capabilities again, will remain our most fundamental and enduring contributions and our airmen and fellow service members both stood by the unconditional support of our families will help ensure the blessings of liberty and opportunity that all of us have shared in this room shall remain a birthright for future generations of americans. i greatly appreciate the opportunity to make a few remarks today and i do look for

which your questions. thank you very much. [applause] thank you. we have an ample number of questions more naturally than we have time to get to probably but we will might as well get started. first off, there is clearly an uptick in allied force air strikes in afghanistan since general petraeus to command the question our rights. does this reflect the loosening restrictions on air power put in place by general the crystal and another asked what is the air force doing to reduce the civilian casualties in afghanistan? >> on the contrary, the truth of the matter is we have 30,000 additional troops in afghanistan an additional operation suggests that there will be additional air operations as well. remember this is a joint undertaking. so the fact that there is an

increase in such activity should be no surprise. it is with respect to our efforts we know that each civilian casualty and each of our youngsters that are operating in afghanistan know that each civilian casualties is a major concern for the commander, clearly for all of us. and we of capacity to imply great precision and without discrimination. let me make the point that -- and this is human rights watch data, this is not our data, it is credible data from a respected organization that 80% of the civilian casualties in afghanistan are not caused by a coalition fires. and of the remaining 20%, only 40% of that is the result of the

air to ground munitions. so it gives you some sense of the precision, discrimination, professionalism that our airmen, navy, air force, army and so on apply. i'm not suggesting we are perfect, far from it, but you should not doubt the conviction on the part of our airmen to do with the commander has indicated its necessary. >> what role did the air force play last year when the administration was conducting its review of afghanistan, pakistan strategy? >> the roll was basically fulfill -- i have two hats for those that don't know. one is obviously my air force chief had and that capacity i work for the secretary of the

air force and my role is to organize training equipped to the best possible air force on the planet. the other i have is a member of the joint chiefs, and in that capacity i teamed up with the other service chiefs, the vice chairman, chairman of the joint chiefs of staff to provide best military advice to the sick to come to the national security council and of course to the president. we did that through multiple meetings of the joint chiefs in which i certainly contributed as well as did the other chiefs, and ultimately one session which we had with the president and his national security team at the white house. >> staying on the white house, last week president to, replaced the national city of pfizer jim jones with the defeat could jim donnelly, talking about

balancing the world wide security and that is the focus on issues like asia, big tower competition to the question, what does this change at the nsa mean for the air force and do you agree that a refocus on big power capability is needed? >> christa falcon let me recognize jim and diane jones has been wonderful public servants over many, many decades. as you well are aware serve the the commandant of the supreme court, commander of europe and then came out of retirement to do this job and certainly did well. the reality is in my role as an organized training equipped individual and as an air force with the national security council deals with on a daily

basis has relatively little effect in terms of the larger organized training equatorial. it certainly has impact on how we employ, where we go and what we do and so on. so i think fundamentally i think the change will be transparent. both are very talented individuals. i know both of them well, and the united states air force again willful phyllis requirements through operating in the ways that are whistling in leadership mandates. >> this questions about military health care costs. and the questioner wants to know specifically whether military families and retirees should pay a greater share than they are paying right now to address the growing bill dod is paying.

>> a bit of background. health care for the department of defense at the moment is about a 40 billion-dollar level of effort. and by 2015, it will probably be in the 60's to 65 billion-dollar level of effort. as you look at the dod budget, that's probably 12, 13 from 14% of the entire defense budget. that is serious money. and the reality is that the co-payments for tricare, which is a very good program, certainly on par with any others in the country, have not changed since 1985. i think it is inescapable that a change will have to be made, and clearly these are matters before

the executive to propose for the legislative branch to dispose. but we collectively as a family effectively serving and formerly serving members and families have to recognize that if we are not careful these unbounded costs can force out military content elsewhere in the department of defense portfolio. that is worrisome and something that we will have to address, do it come hushovd lee, rationally, but it needs to be addressed to estimate this question is about the ban on openly homosexual people serving in the military, so called don't ask don't tell law to review and the others said previously this year that you recommended that congress not act on to repeal the 1993

law ottilie survey of the troops had been completed. that survey is supposed to be done september 1st. if congress acts on it in december would that be acceptable to you? >> that is on changing the law that is. >> we have an obligation to offer both to the leadership in the department and in the administration and to the congress. our best military advice on how to proceed, and as you suggested, a survey of our military members from 400,000 or so is now complete, although we haven't seen the data yet that should occur later this month and the survey of family members likewise wrapped up on the first of october, and that data is not yet completely visible. but it will be and we are on

track to have that information. the associated research that will enable us again to offer our best military advice on if the law changes how would we proceed with respect to implementing the change. and this will certainly be available for the congress to inform the congress shortly after the first of december. >> just to clarify if it is available then you wouldn't oppose the senate taking up a defense authorization bill that has a repeal provision in december? >> i don't have -- i have not had the opportunity to review the data, and i am not going to

prejudge what my recommendation would be at the time. >> question about china. please provide your assessment of how much the united states should be concerned about china's expanding military capabilities. >> i think it's clear that china is a rising power in the pacific , and clearly it is in our national interest to see that they applied their resources and their genius, and certainly their national power in a way that contributes to stability and prosperity, certainly in the asia-pacific and around the world. and as you know, the secretary of defense met with the counterparts just this weekend.

it's clear that it is much better for us to interact with the chinese counterparts a ban to allow misperceptions to persist. this is a path we are on. they are a sovereign nation of, as you are well aware, you know, several billion people. they have significant capacity as a nation and as the people this is a reality and what we need to strive to do is to assure that in our interaction as the two great powers that we do so in a way that benefits again stability and prosperity around the world. >> another china related question. fri president obama listed some embargoes placed on china in the wake of the trademark in minn

square massacre to allow 31 sales to beijing. can you explain what this means practically and is this part of the administration's drive to reestablish the u.s.-china military ties? >> i'm not personally familiar with that adjustment, but accepting it as a fact once again i think that relationships occur at many levels, they occur at a personal level, professional to professional, they occur between air forces in this case that operates similar or the same equipment. it occurs clearly in a larger sense at other levels. and so if we have approval to export certain u.s. capabilities to the chinese and that is what

they choose to do, then i see that as a potentially positive outcome because it has a way of assuring a long-term military to military relationship, which doesn't mean that either party concedes to the unnecessarily on any particular issue, but maintains the professional interaction, which i think is key to minimizing the perceptions, minimizing potential misunderstandings. and again, allowing rational activities to flow as a result.

>> in july, and we're in the midst now of program review which is a process that will last through the holidays and result in the budget next year. it will be at that point when the presidents budget is announced that the efficiency initiative will become clear to all. i think -- with respect to

multiyear, that clearly -- without a specific weapon system application, clearly multiyear makes sense if you have a long term procurement and the prosect for long term procurements and you can assure budget stability. and so, yes, we as an air force savor multiyear when it meets those two criteria. >> question about the refueling tanker program. when is the air force going to announce the award? and given the possibilities of a protest, is there sort of a drop dead deadline when you have the get the thing under contract to get the program rolling to replace the aging eisenhowerer era tankers? >> as you are well aware, we had

one protest on this program already. and general accountability office found in the governments favor. and so that certainly is a -- in our view a reflection on the rigger and the precision of all of those who are working the current procurement process. in my view, it is more important to get it right than to get it fast. and so once again we see the source election coming to a conclusion in the next few months. but i would emphasize again that it is very important for us to get it right. and like in the case of the united aerospace, we intend to

do that. >> another follow up just to clarify. you said in the next few months, can you say whether or not that will happen by the end of the year or be any more specific on that? >> it is more important for us to get it right. [laughter] >> than to get it fast. thank you. >> i'll take that as a no. [laughter] >> on stepping back, and talking about acquisition in general, what is the air force doing cost schedule performance outcomes on it's acquisition programs, and what are you doing to increase competition to make sure you can have more than the usual systems bidding or that you can have multiple bidders on contracts. >> as you are aware. one the things, this is a tribute to secretary mike donnelly, as many of you might

be aware, i have a role in the requirement parts process, but i do not have a statutory role in the acquisition side of things. that is largely in the line from the secretary to the service acquisition executive and so on. bottom line is that much to his credit, one the early initiatives that we took in addition to stabilizing the nuclear enterprise which you referred to earlier was the acquisition improvement plan. and inherent in that plan were a number of initiatives to again regain that excellence in acquisition for which the air force was widely known and in the not too distant past. that included bringing back into the government fold into the air force certain things which we for a while had allowed to

migrate outside the government to prime contractors, system integrators if you will. that includes cost estimators, program management, financial managers, and very importantly, system engineering expertise. which allows us to run a program to know when things are wishful thinking and when they are not. to have this capacity within our own team which had diminished some over time. and so we have -- we are rebuilding that capacity. and again, this is a case of show me. the major efforts that we have under way certainly, the tanker is one. i think the f-35 lot 4 contract is sort of an indication of the kind of rigger that we intend to

bring to the competitive process and in that regard, certainly we favor competition. it is likely to produce a better product, likely to produce one at less cost to the taxpayer. however, it is not necessarily the only solution set. and one has to run the numbers. you have to look at the business case. and there are certain instances where either for the time or the resources available, where it might make sense to have a hybrid sort of approach where it's competitive in part and perhaps not in others. what i'm suggesting is that a doctrine that says we'll compete everything is as foolish as an approach would suggest that will

be cavalier about pursuing competition. okay? >> speaking of competition, there's a big debate in washington about whether there should be one type of engine for the f-35 jets or two different types going forward. why isn't that a case? advocates of having two engines say that it resulted in savings in the past when the air force did it on the f-16 program. why isn't that an example of something where the air force should keep two manufacturers going? >> you said it exactly right. here's the deal. you know, people look back at history in the '80s. a key thing to understand is that we are not operating with the dash 100 engines of the vintage '80 era anymore. these are much more reliable, much, much better products than

they were in the '80s. that's point one. point two, is that we currently operate aircrafts with a single engine. admittedly, these are two engine craft. but the f-22 is a single engine, f-119. the fa-18 is a single engine, the f-414. the bottom line is this is not unprecedent. >>sure, i don't deny that competition might well result in some savings over the long run. the question is whether we can afford it in the short term. and i have to be candid that if roles in ge are so confident that their product will succeed,

and, you know, bring value to the taxpayer, i'm just, you know, it would be nice if they put a little bit more against that $1.9 billion bill that they'd like to tax player to under take. >> on the nuclear weapons issue, questioner wants to know what assurances can you give the american people the nuclear weapon stewardship is secure? >> i can tell you that the united states air force is focused like a laser on this. losing track of 36 -- or i should say six nuclear weapons for 36 hours was awful. and we have made corrections to assure that that never happens

again. we made corrections in terms of establishing the kind of organization that would provide oversight for the nuclear enterprise, both on the operations and the sustainment side. we have structures now within to work for me who are focused on this, not an array of issues. and finally we have reminded our people that do this work and that live under the pressure that's associated with the scrutiny that the nuclear mission brings with it that their work is valued, that it's fundamentally important to america's military posture, and that they will be rewarded for being in this very challenging line of work.

again this is a show me thing. and it's, you know, things can happen. but it won't be for lack of attention. >> several people were interested in the subject of cyberwar. are there rules of engagement for cyberwar? who writes them? are they completely secret? and who decides who to wage cyberwar? >> it's a complex issue. and it is a sort of recent question. this is an emerging area of competition. and the rulesets, and in particularly the statutory backdrop for this kind of activity is not yet mature. and it is something that all, and certainly in the national security community, and our dealing with and struggling

with. we know very well the department stood up the united states cyber command with general keith alexander as the commander. he certainly is at the leading edge, both of cyber policy for the armed services, those in uniform, he certainly is at the forefront of operations, and at interacting with the various agencies of government here who have stake in how we proceed. i need to emphasize that cybercom's role is within the department of defense. it essentially is dot-nil. it is not dot-com, and only in a limited sense is it dot-gov.

so the key thing here is that is larger than cyberwar or with respect to how we as uniformed services employ our capabilities to create the kinds of effects that will secure our interest on the battlefields. it is broader than that, it includes the department of homeland security, it involves the other law enforcement agencies of the government. so it is yet an immature area that requires our -- certainly our best efforts and clearly is a growth industry. regarding satellites, a big part of what the air force does. what steps are you in the air force taking to protect military satellites from attack? and would the united states ever

attack another nation's satellite? >> we just launched a couple of years week from vanderberg air force in california the first surveillance successfully on a rocket. and it's purpose is to assure that we can watch our systems, be able to determine adverse activity with respect to our space systems. this is vitally important. because i believe you cannot deter if you do not attribute. so we are pursuing a path with respect to protecting our assets on which allows us again to surveil, to observe, to confirm,

and to attribute if and when our assets -- come under either interference or attack or what have you. this is vitally important. clearly we have very important assets on orbit. certainly in the area of recognizance and surveillance, and we have assets that do more mundane things that you all know very well, precision navigation and timing like gps. and very importantly, of course, is strategic warning as well. launch warning. so the bottom line is we are positioning ourselves now not only to look down from that, but to look up into the heavens. >> what about the offensive piece of that? is that a part of the air force doctrine or future procurement

strategy? >> the national policy at the moment forecloses that. we obviously obviously -- we coh national policy. >> question about replacing the air force's bomber. when is the air force going to start developing a new bomber as opposed to study concepts or spend money on basic technologies? >> as soon as we can persuade the secretary of defense that we are ready and that we have a formula that satisfied his view of what the country and what the department needs to field going forward. the bomber is not an isolated platform. it is part of the family of systems that includes not just long range strike, but it

includes airborne electric attack, it includes intelligence surveillance and recognizance, it includes communications connectivity, it includes stand off weapons and close in or direct attack weapons. and so on. and so fundamentally what our purpose is to explain to the secretary and his close advisers how we see this family coming together, it's various capabilities that will last for the next 30 and 40 years and that it is a strategy which can be resourced given the likely pressures on the defense budget. those discussions are occurring now and they will conclude, i think, during this budget cycle and so we'll have clearly some key decisions, you know, later this year certainly soon after

the first of the year. >> question about base closure. the re alignment and base closure process. does the united states need to do that again soon, and how soon? >> if we are looking at efficiency, there are three or four categories of things to look at. clearly one is the force structure. airplanes for us, or satellites on orbit or what have you. there are ways to procure and operate those that drive left or, you know, a lesser cost of operation. personnel is a segment that clearly you could get smaller.

we have no intent to do that in the air force. we're not going to get bigger either because we can't afford it, but the demands on the team are such that man power, at least numbers is not likely to change. you can affect procurement. which is not an insubstantial portion of the defense budget. as you suggested in your introductory remarks, this is not only true of the air force, there are capitalization requirements after ten years of conflict that we need to deal with. so the last area or major category is infrastructure. the question is: does the department of defense has excess

infrastructure to do it's essential missions? this is one area that i think needs scrutiny. i can't anticipate because as you are all well aware, these are emotional issues. these are highly charged, and whether there will be the will obvious -- or the willingness to look at infrastructure as a place to gain efficiency. at the moment, it's largely off limits. my basic point is that i don't think it can remain that way indefinitely. >> we're almost out of time. before asking the last question, we have a couple of matters to take care of. important matters. let me remind my members, first of all, of future speechers, october 15 condoleezza rice, october 5th, allan hershey ali,

an author, and the national spokesperson for the share our kids strength hungry campaign. second i'd like to present our guest with the traditional npc, national press club, mug. since you are the chief, you can put whatever beverage you like in there. >> diet coke. >> okay. thank you so much for coming together. here's the last question for you. you recorded recently saying some days are better than others on this job. of course, you were referring to the air force association's defeat of navy in football game earlier this month. so question is who's going to win the commander in chief's trophy, which goes to the top service football team? >> we're looking forward to go

to the white house this year. you know, i must tell you, just quickly, mike mullen and i were at the game. i got to toss the coin with the chairman. it was a classic day of service academy football. this was two teams committed, played hard, close game, the crowds were supportive of both teams. just the majesty of the moment was terrific. i'm glad we won. but, again, a key point is in i really would like to just connect this with the photographers daughter today. that america needs good people to do this stuff. and certainly, whether they are medi, or cadetted, these are wonderful, wonderful folks that will serve the country well years down the road, as well as

your daughter. and i hope that, you know, you'll consider public service in some capacity as well. thanks very well. [applause] [applause] >> thank you for coming today. i'd like to thank national press club staff for organizing the event. for more information on joining the press club or how to acquire a copy of todays program, go to our web site, www.press.gov. thank you we are adjourned. [gavel] [inaudible conversations] [inaudible conversations]

[inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations]

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that i never thought i would be writing. a miti