in every military person to respect and always look up to the civilian authorities that clearly are superior in our system of government. and so it's tough sometimes to disagree with the commander in chief. it's tough to disagree with powerful members of congress that literally have the influence and power over whether your service receives necessary training equipment and everything else to me to function effectively. so i would like to thank every member of this body -- of this panel this morning for their candor, for their honest opinions. it restored my faith and confidence in the loyalty and professionalism of the leadership of our military. i will not agree to have this bill go forward and neither will

i believe that 41 of my colleagues will either because our economy is in the tank. our economies in the tank, and the american people want that issue addressed. and the military is functioning in the most efficient and most professional, most courageous fashion that in any time of our history. so to somehow believe that this is some kind of compelling issue come at a time we are in two wars, as general rios's support of so eloquently pointed out, is obviously not something that we shouldn't be exercising a rush to judgment. thank you, mr. chairman. i said earlier i don't want to hear from our senior enlisted personnel, but command master chief scum command master sergeant, i want to hear from them, i want to hear from our component commands. i want to hear, again, from the men and women who are serving

who will be directly affected by this and those who have the ultimate responsibility for carrying out whatever change into law takes place and i think that would be more than eager in the coming year to have additional hearings as they have some 13 hearings when "don't ask don't tell" was enacted and look forward to joining with you and senator lieberman and other members of this committee next year in taking up this issue again and examining all of the ramifications by the way including costs which was referred to a little bit here this morning and i would pledge to work with you on that effort. but certainly not in a lame-duck session when parts of my state are suffering in ways they never have in the history of my state. thank you, mr. chairman. >> thank you, senator mccain. senator lieberman thank you, mr. chairman. i say to senator mccain, i

agree our priority is restoring economic growth and jobs in our country. but we can do both. we've got the time if we have the will to work across party lines to both do the things best for our economy coming and in my opinion that means of raising anybody's taxes for the economy is as weak as the numbers came out today said. but we've also got the underlining national defense authorization act, which as the witness is no, contains within it a series of a large number of authorizations. they are really important to the troops come to the military, and particularly to the troops in combat. and if we don't pass that, they are not going to be supported in the way that deserved to be supportive. so i really hope that we can come together and use our time wisely to get to meet all of our priorities. senator wicker asked earlier why

are we here doing this in combat? and i think senator levin gave one answer. we have been at this for quite a while freely, but we are also, we are here in part because some of us think the current -- and admiral mullen particularly spoke to this yesterday the current policy of daudistel "don't ask don't tell" isn't good for the national city and we put 14 doesn't people out, not because they were in any war in an adequate members of the military or violated the code of conduct, but just because they were gay, so we lost a lot of money and one estimate we spent $500 million training vose -- i don't know whether that is right or not -- but trading was 40,000 people who were then kicked out for no good reason in my opinion and we lost the benefit of that money. we are also losing as you all know probably several hundred of those were at mission critical

skills like translators and health personnel and intelligence analysts. we knew those people and in the combat to support our combat troops. so, -- and this policy i think does discourage a certain number of people who are gay and lesbian have specialized skills or just the will and courage to be prepared to put their lives on the line for the country for enlisting them in the first place because they don't want to go through a system where they are living for fear that they will be held at -- outed. there was a part of the survey quoted yesterday at want to quote again. it struck me that the survey did interview a certain number of gay and lesbian military personnel, members of the armed forces. what surprised me was that only 15%, 15% of the gay and lesbian

service members that responded to the survey said they would want their sexual orientation known throughout the unit. this sort of gets in a way beyond the believe or no discussion, general casey, you had to senator reid, and one member said, and i quote, i think a lot of people think that there is going to be this big outing and people flaunting their gayness but the frigate rear in the military. that stuff isn't supposed to be done during the duty hours regardless whether you are gay or straight, and of quote. so i think that -- and then this other testimony that i have heard personally talking to people which is that what they fear is that somebody will accuse them of being gay because they don't like them for another reason and will be a basis for them being tossed out of the military or they will be seen as -- at a bar on the hours when

they are not at duty and somebody will report that and for that reason as a part of their private life they will be tossed out of the military regardless of how effective they are as soldiers and this gets to be the so-called integrity question that admiral mullen spoke of yesterday which is a core military value, again, i repeat military is one institution that still lives by phil use -- del use pilat institutions say we do including this one but we don't do it as well as we should. and so i think all of this so quickly is to answer the relevant question that senator wicker ask which is why are we here and i think we are here because this is the current policy those of us that the change. we are here because we think the current policy is not good for the military in terms of its core values but also more relevant to the combat situation because it deprives us of a

number of members of the military who can contribute to the success in combat. i think your testimony, we will take and i suppose what we will and what we want to take from it, but i think your testimony, i'd object to what i said, this has really been the best, this has been a free exchange of ideas and if there was changed and will make it work. i am encouraged, general casey and others said that in the wording of the amendment we have come getting the secretary unlimited time to certify, i heard the secretary incidentally said yesterday he's not going to certify to this theoretically through the repeal and in other words he's not going to certify to this because he believes it can be done without effect on the military moral effectiveness >> he's going to need to be convinced that there are plans in place that as he said

mitigate or eliminate concerns he has, so i just hope, one, we can find a way to agree this underlie in defense authorization bill is so important to our military and combat that we have got to find a way to get it done before we leave here this session. this will be the first time i believe in 43 years that congress, a congress will not pass a defense authorization bill and secondly, that we let there be a free debate on the "don't ask don't tell" and with the confidence to repealed passes, there is a process in place implement as best we can do by law is implemented so as to use stick to the gates words mitigate or eliminate any of the risks that few of you sincerely expressed your concerns about here this morning so thank you very much for your testimony. and for your service to our

country and many ways including the integrity of your testimony before us today. thank you, mr. chairman. >> thank you, senator. >> i would say mr. chairman i want to thank the witnesses and thanks for listening. i think it's very clear that given the testimony of the service chiefs which i have said all along our military leaders and we need to have testimony of our enlisted leadership we rely on so much of our senior enlisted personnel as well, but the fact is testimony today clearly indicates that we don't -- we shouldn't rush forward to judgment on this issue or pass legislation. also point out that the legislation that was referred to also has controversy all issues including abortions and military hospitals and including the billion dollars worth of

unmitigated outrageous pork that was added in the authorization bill which the american people just spoke so decisively against some of this year marking and pork barrelling that has been going on which they had rejected soundly and other controversies positions. there is a problem with the defense authorization bill isn't confined to the "don't ask don't tell" issue, and again, i am proud that we have the finest and best military ever seen which contradicts my plan from connecticut's statements that there are so many problems in the military associated with this policy. not when you've got the highest retention, the best recruitment and the most professional military in our history. we just have a difference of opinion. i thank the chairman. >> thank you very much, senator mccain. let me say first of all, the place to address the kind of issues which senator mccain

raises is on the floor of the senate. there are issues of course in any defense authorization bill that come out of kennedy and the only way those issues can be addressed this to the date and resolve them in the senate. i'm hopeful that we can get to that point yet this year as that's the only way we can get this bill passed is to debate issues where there are differences and to resolve those differences. that is what has been thwarted and i hope that we can somehow or other to carry out a half -- figure out a path to get to the issues which are legitimate at the base including the ones senator mccain made reference to. secondly i think all of us will hopefully read this report, including the statement of the people who wrote this report, our study group here that the

u.s. military's spry your experiences with racial and gender integration are relevant and they pointed out on pages seven and eight that their assessment in their words the resistance to change the time, this is the time after world war ii and during the cold war, was far more intense. surveys of military review opposition to racial integration of the services as at levels as high as 80-might be present amos of our best known and reviewed military leaders from world war ii era voiced opposition to integration of blacks in the military making strikingly similar predictions of the negative impact on unit cohesion that is quoting from this study about how the military's amazing ability to reflect people has

been proven time and time again. it will be proven in this case hopefully sooner rather than later. you gentlemen have a unique position to make it happen and you testified you can should that be the decision of the congress. i want to join my colleagues in expressing my admiration to each and every one of you. our gratitude to you for your testimony to the men and women that you command. their service and your service is extraordinary, and we will now stand adjourned. [inaudible conversations]

[inaudible conversations] [inaudible conversations]

several tax cuts are slated to expire your the end of the month and the senate is considering proposals to extend some or all of those tax cuts. senator max baucus has proposed extending the cuts for married couples earning less than $250,000, and for single taxpayers making less than 200,000. he talks about the plan on friday. we will also hear from senators chuck schumer of new york and orrin hatch of utah. this is just over an hour. >> mr. president, the provision of economics is about scarcity.

for example, these principles of economics, president bush's chief economic adviser, gregoryc wrote this, quote, economics did the study of how society manages its scarce resources, in the ofe quote.about fis about fiscal polfiicy.sc how fiscal policy is about howment, society, acting through its government, chooses to allocate scarce resources. there is not an endless supply e of money. we have to make choices. every time that we put together a budget, we have to make choices. every time that we formulate thv nation's tax policye, we have to so wn make choices. so when it comes to whether to e extend the 2001 tax cut, once again, we have to make choices. it's a question of priorities.ut the debate over what to do aboue

the 2001, 2003 tax cuts for a those with the highest incomes is a debate about priorities. be are we better off devoting resoc scarce resources to a larger tax cut than those of the very top? taat or are we better off devoting those scarce resources to the to new tax extensions to the investment and create new r job? or are we better off devoting those scarce resources to reduc reducing the federal budget and deficit? those are the choices that we tt need to make.onsidering today the senate is consideringe how we should meet the stressese the amendment that we have offered says, and we are about to offer, -- fd, >> mr. president, what my friend, the distinguished me chairman of the committee, might i interruptma -- ask t >> majority leader -- t >> and i would ask the record to show that there is nor: withoobe interruption.ctresident i thi mr. president --

>> without objection. >> with everyone being notified therel will be no local votes today. we are still votes working on wn time we leave tomorrow, but asay everyone knows, and i have sat e here as the third time, we are within inches of having worke something workout on having votes today, but for reasons that -- for the reasons i don't fully understand and republicans didn't agree to that at the last minute and now we have to figure out what time we are going to it vote tomorrow. if we can't work it out by consent, and of course we willn, do it one hour after we come int which is the rule, and we havetr people lead to moral and people early tomorrow, so we need to furloughing me to interrupt. furloughing me to interrupt. >> thank you for your hard work on the spirit of these working harder than you do to work out t the schedule to invest in theseu issues and we thank you. basall,

>> someone else is basically the what's make the tax cutanent. permanent.one in t that is something ability in this chamber should agree. and after we have cut taxes for middle class americans, thenest. let's have an honest debate thee party. in anycl case, the middle class tax cut permanent is the right thing to do. let's not allow tax cuts fore middle class americans to be held hostage to partisan about tax cuts for those who make the very most. so how did we come to this choice? let me take a few moments to review how we got here. in 2001 congress enacted to let american families keep more of their t money. incenti many of the tax incentivesn phased in over several recent years. cess in 2003, congress enacted new legislation to add new tax

incentives and speeding up implementation of the 2001 law week. the 2001 and 2003 tax cuts lower the tax rates for all taxpayers. and those laws provided much tax relief for families, education and small business. p many ofro these tax provisionss have broad support across the political spectrum. but these tax benefits are not permanent. beginning on january 1st, all o3 these 2001 and 2003 tax cuts ned expire. them the even those four americans who need them the most. at at the same time, the federalhoy debt is at its highest level since shortly after world war ii. and the fiscal challenges are growing at the retirement of the baby boom generation.nds to bh the amendment that we considerae today is sponsored both of thes? challenges. so, what what our amendment to? first, our amendment would

metend tax cuts for middle clasd american families.nd the our amendment would permanently extend the lower tax rates for the income up to $250,000 for married couples and $200,000 for individuals. all standing these lower tax ratesas would benefit all taxpayers, al. taxpayers including part income tax payers. in fact, higher income tax payers would receive the largest av per taxpayer, eand that is, of l course, because we have our marginal rate system in americat so tax cut, make it permanent,am all taxes for those americans below $200,000 will w benefit al americans, those below 250 those above 250 will from this amendment given if it.e the higher-income taxpayers receive the largest tax benefits in terms of dollars per taxpayes even under the to and 50,000 ofr our amendment.ment our amendment would make child

permanent helping working families with children.g a number of people living int poverty is a 15 year high.meri one outca of every five american chilfdren and lives in poverty.r many of these provisions in ourr amendment would help keep. children and their families out of poverty. the amendment would make earned permanent the expanded earned income tax credit for families increased tax credites provides more help to families with children. p the portion of the credit on crt families to receive a benefitcea even when their tax liability il low as long as the family's famy earned income of more than $300,000. this credit helps supportamilie 15 million children and low-income working familie every year. these families are likely tot spend every dollar they receive right away, and that means thatm this provision would also help the economy.

the increased child care credits recognizes the increased cost of child care for working families. people should be able to go to work and have quality care the need for their children. in 2008, the credit helped mores than 6.5 billion working families to make ends meet.t a our amendment would make permanent a tax benefit for employers construct, build or ud expand a property used as a child care facility to read this and if it recognizes thes the contribution that some employero make to help their employees balance child raising and a pro career.permanenrriage it provides marriage penaltyay relief, that we married couples would not get higher taxes as aa added wedding present.ldect the amendment would direct certainer government programs ts regard refundable tax creditsmig the programs. aricans this would insure americans mose in need would not be worse off

because of tax i incentives. we don't want to give a fun hanr and take away with the other. our amendment also addresses tha importance of getting a quality education and the cost of getting that education. our amendment would make it easier to adopt student loann oe interest rate to delineate themt restriction on a number of months eligible for the deduction and extend theore eligibility to the post t a graduates. elbra amendment would make permanent the american opportunity tax credit. affo this would help students to proa afford a higher education. this provision is a partially cp $2,500$2,500 of the college tuin fees and including books. an the amendment includes income ln exclusion for the loan repayment programs postgraduate become mealth professional in thehe a underserved areas. and the amendment wouldfor worke encourage the continued ioucation for workers byexclus allowing an exclusion from

income for employer providedempy gucational assistance programst what will we do about the d capitol gains and dividends? right now capital gains are of currently taxed on a maximum trd rate 15%. and dividends are treated as capital gains. o this treatment expires at the end of this year. act, capital gains will be taxed at 20% and dividends will be treated as ordinary income.rmane our amendment would make permanent the current capital wh gains rate for the taxpayers with incomes up to $250,000 per married couple, and up tols. $200,000 for individuals. gai the amendment continues to treat dividends as capital gains for v all taxpayers.eated as so dividends would not be treated as ordinary income forel any taxpayer.tpaoefpltdhis this would level the playing e- this would ensure thatayin tax e wouldn't put one over the othere

what do we do about theour ame alternative minimum tax? or amendment would apply to years of relief from the amt. tb every year we talk about the amt and how the standard of hard-working americans. cre the amt is to stop it at just fm 155 million from completely avoiding income tax. taxes the was the point of the emt. *l it was an attempt to ensure all taxpayers pay their fair share. what about today? illions of hard-working families are subject to this dreadfulno tax, not 155 millionaires, but hundreds of mi people.ll millions of raising children find themselved hit with hidden fees and taxes.m we are not talking about increig millionaires, we're talking of because it wasn't indexed.yers to keep the number of taxpayers subject to this tax from an growing, congress has to passwih and a emt tax every year.ct to without an amt tax, the payers

subject which explode.lode. in montana, conagra's's failure with more than six times as many fuld have.. our tv could take care of the amendment for 2010 and 2011 andn during the time congress canax view the self tax once and for all as part of the tax reform.or what about small business? a recommend that would benefit small business owners by making the section 179 expansion. what about the state tax? tax our amendment would provide a permanent relief of family-owned businesses. t 2001 congress voted toprovids perfidy state tax relief to american families, we decrease d the rate and increased exemption over time until we had a complete repealed for 2010 only thus we have today, 2010. year next year if we don't act theill law will snap back up to the. ate. resulted this has resulted in uncertainty

and the planning for families.at our amendment would eliminatethe that uncertainty and would makee permanent the 2009 state tax law we going forward.ld we set the rate at 45% and the extension 3.5 per person which4, amounts obviously to $7 million per couple. the amendment includes elections for states that a rose between january 1st and enacted. to be will choose either current law or permanent tax rate andn exemption. it would provide an exceptiony for the family and farms. this provision would ensure thao no family farmer branch ever hah to be sold to pay taxes. would f our amendment would simplifymose planning for spouses. most people believe that a autom couple automatically receives double the exemption amount. so it is an extension 3.5 million most folks assume ae couple gets 7 million.any peopl but what maney people don't know n,

exemption, couples have c to pl. our amendment would simplify of planning for spouses by allowing the transfer of any unused the exemption between houses. that p this would need the law work the way the most people think it works already. wou the very largest estates. it would ensure a small number of people who inherit so much money they never have to work during their life would contribute their fair share. what about the provision that folks call tax extenders? our amendment would extend a number of other tax provisions important to individuals, businesses and state and local governments. these provisions will continue to help create jobs and cut taxes. our amendment would create jobs by improving our nation's infrastructure, reduce the cost to local governments to build roads, bridges, and water treatment facilities. treatment facilities.

>> it would promote energy sustain the and efficiency. it would extend the dollar per gallon credit for biodiesel and extend the manufactures credit for the construction of new energy efficient homes. the amendment includes that credit for energy efficient appliances and credit for fuel vehicles and the amendment includes the extension of the credit of the manufacturing technologies for the production of renewable energy in energy storage. it would provide party for benefits and employees get benefits for transit and parking. it extends a number of tax cuts for individuals including making it work pay credit. very stimlative that provision, helps the economy dramatically, and if we're not, it hurts the economy. it helps teacher by extending

the tax reduction for bying supplies for their class momes. -- classrooms. it has the ability of itemizers to deduct sale taxes in lieu of local income taxes. it extends the qualified income tuition to help with college costs. the amendment stands for relief in communities that suffered from natural disasters. it would extend tax provisions to help create jobs and make our communities competitive in the local economy. it extends the credit to help american businesses keep on the cutting edge and includes a provision to help small businesses across the country to appeal reporting rules active this past year known as 1099.

those rules extended current information to include payments, business, major corporations, and payments for goods and property, not just services. this provision known as the 1099 provision imposes the recordkeeping burden on small businesses taking away from time that business owners need to expand their businesses and create jobs. this information reporting went too far especially in this difficult economy. it's important to repeal this expansion of information reporting. now, some say we should extend tax cuts for everyone, even the very rich. america's working through tough economic times. at the same time, our country has record deaf deficits. our amendment balances these two concerns. our amendment extends all the tax cuts effective middle and lower income americans that congress enacted in 2001 and

2003 that expires this year. there's several expiring tax cuts benefits lower and middle class americans that congress enacted in 2009. our amendment protects americans who have been struggling to get by. the amendment also benefits taxpayers with higher incomes. the cuts in our amendment apply to all of the income up to $200,000 for individuals and up to $250,000 for couples. at the same time, the amendment with recognition of the mounting deficit that our country faces. the amendment would not rely on the gimmick of extending tax cuts knowing that future congresses will be able to resist the temptation to keep extending these cuts. it's about priorities. our amendment makes choices. our amendment would not make

permanent all the expiring tax cuts that congress enacted in 2009. it yowled not make -- it would not make permanent tax cuts to only the americans who need it. only 3% of americans have incomes greater than $250,000 for couples or $200,000 for individuals. 3%. the tax income of the wealthiest 5% has grown 150%. at the same time, the average after tax income of middle class americans has grown but only 28%. 150% for the top 5% wealthiest? only 28% for middle income americans. 150%, the other 28%. the bottom 80% of households receive less than half of all

after tax income. the benefits of recent economic growth have not been widely shared, so the middle class should not be asked to tighten their belts as much as the high income folks who have benefited the most, and as we come out of the great recession, we need to recognize the growing federal budget deficit. in 2010, the deficit was $1.3 trillion. that's the second highest level relative to the size of the economy since 1945. this has exceeded only by 2009's $1.4 trillion, 100 billion more, and the budget office projects deficits will remain high for the rest of the decade. that means the federal debt will keep growing. when we passed the 2001 tax cuts, the federal government was running a surplus. when we passed the 2009 tax cuts, economists projected big

surpluses as far as the eye could see. times have changed. we need to consider our current fiscal condition. with 15 million americans still out of work, it's important to keep the economy on the path to recovery by extending tax cuts for families who need them the most, and who will spend it. our amendment strikes the right balance. it's a question of priorities. our amendment said that we should not devote scarce resources to a larger tax cuts for those at the very top. our amendment says we would be better off devoting those scarce resources to new tax incentives over investment and to create new jobs, or we would be better off to use those resources to reduce debt and deficit. those are the choices we have to make. our amendment says let's make the middle class tax cuts

permanent, not allow middle class americans be held hostage to tax cult cuts by those who make the very most. there is not an endless amount of money, and we need to make choices. i encourage my colleagues to support my amendment. >> mr. president, the other side wants you to believe that the americans support tax breaks for americans. i heard it. they said the election, can't you democrats hear about the election? well, i was running this year. i happened to get 65% of the vote. i got a lot of votes from republicans and independents, and i talked to a lot of angry people. i saw a lot of tea party people, none of them said to me, keep tax breaks on the millionaires. they may have said shrink the government or repeal health

care. that's true. none, none, none, none, none said keep the tax breaks for millionaires and billionaires, and here's a poll that shows it not by some democratic party organization or some republican party organization, but by cbs, it's a nonpartisan poll. the poll yesterday says only 26% of americans support millionaire tax breaks. 26% say, well, that's just the democrats. oh, no. only 25% of independents say keep the tax breaks for millionaires. those swing voters were the ones who created a lot of new republicans seats and caused us to lose a lot of democratic seats, and even on the

republican side, 46, only 46% supported millionaire tax breaks, so this idea that the election was a mandate to cut taxes on millionaires and billionaires, you know, i department only run in new york, but i work with my colleagues in every part of the country, none of them reported any one wanting to keep tax breaks for millionaires. none. that's not what the election said. now, maybe the money of some of those millionaires helped create ads on other issues that helped win the election for these folks, but not the issue itself. so, we need to get our economy humming on all cylinders again, and it is true, we need to stimulate demand. mark zandi, an economist republicked on the left and

right, senator mccain's chief economic adviser when he ran his campaign said that every dollar spent on tax breaks for the millionaires generates .32 cents of economic activity. those of us who believe on economic efficiency, which i do, that doesn't work. let me give you a contrast. every dollar spent on unemployment benefits -- excuse me -- generates $1.61 in economic activity, so if you care about getting the economy going, you'll be for increasing unemployment benefits rather than tax breaks for millionaires. even economists on the right don't believe that's false. they are 46% more stimlative -- excuse me.

on wednesday, when my esteemed colleague from ohio, senator brown came to the floor and asked for concept of a one year authorization of the unemployment benefits, the other side objected, and as you said, mr. president, when you were speaking as senator from minnesota on the floor a few minutes ago, the anomaly, the republican party is saying we don't have to pay for tax breaks for the millionaires, but we have to pay for an increase in unemployment benefits. what kind of logic is that? the middle class, mr. president, is worried. they are worried about how they will stretch that paycheck. they are worried how they will make that mortgage payment. they are worried about how they will keep that job, and this, this recession middle class people are more unemployed than ever before. most recessions in the past had two differences. one, they mainly affected the poorest people in the working

class people who made the lowest salary. this has gone up into the middle class and upper middle class. i've met hundreds of people as i have traveled my state. second, they are out of work for a lot longer. it's not just three weeks, three months, but nine months or a year, and we just heard the unemployment rate went up under these bush tax cuts to 9.8%. we're trying to offer solutions that bring the unemployment rate down. we're trying to offer solutions that focus on the middle class, and they are busy defending the wonderful people who make a lot of money, but don't need the help. after senator brown offered his bill to reauthorize unemployment insurance, they asked consent to pass a bill for the highly successful building star program giving tax incentives so construction workers could build buildings that were energy

efficient. 150,000 good paying jobs. they objected. next came senator from michigan, a real leader in the fight for job creation. she came to the floor to give tax breaks to manufactures. we need manufacturing, not only in her state of mental anguish, but in my state in new york particularly upstate. conservative estimates said the bill creates 45,000 private sector jobs. again, republicans objectedded. then i offered a bill myself. i'm glad my colleague from utah is here. this was a bipartisan bill, a tax cut for business called the hire act. it says if you hire somebody who is unemployed 60 days, you don't have to pay the payroll tax for this year. it'sics pyring -- it's expiring. i wanted to extend it. objection. the bill had passed with

bipartisan support, but the point is to get tax breaks for the millionaires, they would even object to a bipartisan bill that gave a tax break to businesses that would employee people. what kind of logic is that? one final point now as i conclude and that is the deficit. the deficit as i mentioned is huge. let me just say that the bush tax cuts and particularly those for the millionaires and billionaires huge amounts of the deficits, and we don't hear a peep about it from the other side. they say they care about the deficit, but $300 billion that it would cost to give these tax breaks to millionaires and billionaires, that's okay.

please. over the next year, i'm going to be up here reminding my colleagues when they say we can't pay for help to our schools so that they can hire a science teacher who might create the genius that creates a new industry that creates new jobs or when they say we can't have money to fix a road or a suer project to create good-paying jobs because it would increase the deficit, i'll remind all of you that when you gave tax breaks to millionaires, the deficit didn't count. just remember that. >> mr. president. >> would my colleague from new york allow for an interruption? >> without objection. >> i ask that his statement not appear interrupted in the record. >> without objection. >> i've been in touch with senator mcconnell, and he knows i'm asking this agreement. i ask you to consent 10:30

tomorrow morning to vote on the reed motion to concur on hr4853 number 4727 to the time of 8:30 to 10:30 a.m.. >> is there objection? without objection, so ordered. >> mr. president, this is a time that virtually no one is happy with. someone wanted it late, some wanted it early. as i indicated to davis, we split the baby in half. it's the best we can do. we're making as many people happy as we can, so come in at 8:30 which is unusual on a saturday, but people who live certainly east of the mississippi, they can go somewhere that's difficult, but at least some people have an afternoon at home or in their

states. that's an agreement that has been approved. >> mr. president? >> senator from new york. >> and of course, they say that these tax breaks for millionaires and billionaires are tax breaks for small business. well, my good colleague, mr. president, someone who looks very much like you, the senator from minnesota who is seated over there a few minutes ago, talked about that. my dad was a small businessman. he had a little exterminating business. it was not successful. i know how he suffered through it. he knows that these tax breaks are not for a business like his or the dry cleaner or the restaurant or any of these other businesses. they are not for any businesses at all because we are not talk about corporate tax cuts.

they are for very wealth people, some of whom you've mentioned, so i know my colleague from utah has been patiently waiting, and so i'm not going to talk about all the small business stuff, but i just want to remind people about this plan. under the president's tax breaks for millionaires, here's what would happen. under the plan that my colleagues across the aisle are supporting, people who make $1 million get a $43,000 break a year. people who make $10 million get a $400,000 break per year. people who make $100 million a year get 3.8 million break per year. the average middle class family making 60,000 gets 2500.

we want to get that middle class family its break. we'll give the same amount to these folks. they will get a break, no more no less than the middle class family, but we don't believe these breaks when we have so many other needs and a huge deficit to boot are called for, and we'll be debating that all day today, all day tomorrow, tomorrow morning until 10:30, but also for the rest of the next two years. , and again, i want to repeat, don't talk to us about deficit reduction, folks. if you're willing to put this whopping hole in the deficit for tax breaks for the millionaires and billionaires, don't come to us and say this program for this school or this road or this small business incentive has to be, well shouldn't be passed bought of the deaf silt, but --

deficit, but it's okay to give the break to these folks. more people last night tuned in to watch the reruns of "matlock" that would benefit from the republican's proposal. i have not seen "matlock" in a long time, and i'm sure the people who watched it had a good time, but it wasn't many of them, but it's more than the millionaires and billionaires who get this break. they are a powerful group. god bless them, but they shouldn't have the power they have for the people on the other side of the aisle to tie themselves in a knot to prevent all important things from happening until they get their break. mr. president, i yield the floor. >> senator from utah. >> mr. president, i always enjoy

listening to my colleague from new york. he's one the brightest and toughest colleagues here. he's been a good friend over the years. the schumer-hatch bill is now law. it was a good step in the right direction as far as gaining jobs, but also i want to point out that 56% of all capital gains that create jobs are paid for by people who earn over $500,000 a year, and i also would care to point out that i will absolutely guarantee to everybody watching us here today that if there were these tax increases, and i think the thing senator knows is that suggestion polls very well is that the reason why we should do it? no, but i guarantee you, and i don't think anybody can doubt

this guarantee, that if his approach wins, the democrats will take every dime of that and spend it. in fact, the president's budget spends more towards the end than it does now, i mean, a lot more, and that's one of the problems here. we know that a good 50% of small business would be affected, the ones who really create jobs. there's 25% employees and 50% of small businesses would be affected if we do what the democrats would like to do. be that as it may, those are # the differences, but i'm going to explain why at the last minute of this congress after they -- a people that happened during the election that we can't seem to get together during a time of economic disstress and come up

with these tax reliefs that were started in 2001 and 2003 that we can't do that at the last minute to come in and want to change the game again, and do that at a time when we have the economic difficulty and problems that we have, it's more of the same, mr. president. mr. president, over the last few days, americans watching c-span would have seen talks about widespread tax hikes that arrive in the new year. now, many of my friend on the other side pledged several attacks. c-span viewers were probably not surprised that the attacks were aimed at those on this side. i will not get into correcting the record anymore than i have with all that misinformation right now, i'd like to focus on two things we heard. we heard them over and over again. the first thing was repeated many times. it was this.

republicans are accused of holding hostage tax relief for middle income taxpayers. the second thing took creativity. if you listen to our friends on the other side, you would think they had a psychic mind reader that the mind reader successfully read the minds of 42 republican senators. they have determined the merits of 42 republican senators, perhaps not surprisingly the motive described was not very favorable. republicans alleged hostage taken were described as solely motivated by a desire to cut taxes for high income people. mr. president, if our friend on the democratic leadership hired a mind leader, i advise them to seek a refund because it didn't work. you've been had, my friends. you didn't need a mind reader. you need not come to the floor

to talk to your colleagues on the other side of the floorment on this side, the record is clear today, it has been clear for a decade, that the tax relief program has been in effect. actions speak louder than words. votes speak louder than talking points or press releases. when first passed, over -- excuse me over 9.5 years ago, nearly all the republican conference supported the bipartisan tax relief plan. roughly one-fourth of the democratic caucus supported the plan. because of the opposition of the democratic leadership, efforts were made to make these policies permanent law were rebucked. check the record. during the years of the republican ma majority, the democrats made the measures permanent. those efforts were also opposed

by this other side. mr. president, the record since the democratic leadership assumed control of the congress, almost four years ago, a few moments ago i said actions speak louder than words. votes speak louder than speeches. after a second permanent tax relief in the minority, what did our friends in the democratic leadership do when they gained power? well, let's take a look. i have a series of charts here. the democrats have taken power. these charts chronical the record of the democratic leadership on this time sensitive matter. the first chart here chronicals the first year of the new democratic party majority. the year is 2007. the democrats took power on january 4th, 2007. you see it circled on the chart

right here. that's january 4th. look at the rest of the year in 2007. i mean, think about it. no action was taken on the tax hikes that come down in less than one month. no action, mr. president, no action, none, nothing, zilch. let's look at 2008. now, this chart is pretty simple. take a look. it's completely blank other than the calendars on there. no action, mr. president, no action, nothing, none, zilch. here's the chart for 2009. it's an important chart as well. there was big changes in washington.

democrats gained a large majority. 60 votes in the senate. it was basically a filibuster proof body. that's circled here on january 6th. when president obama takes office on january 20th right here. it's circled right there. you can see it. a little over three months later, an event occurred that many on our side of the aisle will not forget. the senior center from pennsylvania crossed the aisle to give democrats a filibuster proof majority. let me just talk to that third circle right here. now, nothing happens for the rest of the year. nothing happens for the rest of the year. the larger democratic majority is sworn in, president was

spurne -- sworn in, and then senator arlen switched party, and that got 60 votes in the united states senate, and nothing else happens the rest of the year. nothing happens. on december 3, 2009, one here ago on december 3rd, the house democratic leadership, now that's way down here by the way, passes a long-term debt tax reform. now, that's right here on december the 3rd. that's after -- this represents a milestone by the way, mr. president. almost three years into the majority and into their majority, one person of the congressional democratic leadership took comprehensive action on one piece of the 2001 tax relief expiring provisions.

now, let's take a look at 2010. it's the fourth year of the congressional democrats controlled both bodies in this decade. the house passed debt tax reform, was placed on the senate calendar on january 20th, 2010. when senator scott brown was sworn in on february 4, the democratic majority fell, if that were, if appropriate to 59 majority votes. what's happened to the balance of this year? what actions have the democratic leadership taken as the big tax hikes approached? with the economy slumbering and big hike tax coming, what actions has the democrats in both houses taken?

with america's small businesses expressing pessimism about the business environment and looming tax hike on the horizon, what actions have the democratic pearpt leadership take -- party leadership taken? with the 9.8% unemployment rate and big tax coming, what actions have the democratic party leadership taken over the last few years? the unemployment rate is going the wrong way. that's upward by the way. it's going up again. more americans are out of work. now, i'd remind my friend in the democratic leadership to pay close attention to this data. it should concentrate the mind on policies to counter the problems at hand rather than politics. with the big tax hike less than a month away and the horrible economic data arriving this morning, what actions have the democratic party leadership

taken? the democratic leadership in the senate? well, let's take a look. of the past several months, republicans senators have come to the floor to urge our friends in the democratic leadership to advance a very time-sensitive topic. i'm referring to the package of unfinished tax legislative business. i'm on the finance committee sitting next to ranking member senator grassley. i expect to take over as ranking member in january. ranking member grassley and i use this chart a couple weeks ago. the only piece of legislation the senate considered is one small, but important piece of unfinished tax legislative business. it's what we call tax extenders. something that we almost automatically have passed in the past.

unfortunately, the democratic party leadership in the senate and house scuttled on a bipartisan agreement about 10 months ago after we put it right out of the democratic finance committee, they basically canceled. that is the tax credit that helps our high-tech world to remain competitive just to mention one. the reason i mention it is because it's something everybody wants, so it's one of the goals that binds everything together. this whole year after we put the tax incentive bill back, look where we are. like i say, unfortunately, the democratic leadership scuttled between ranking member grassley about 10 months ago. after that a partisan strategy

was presented by friend on the other side and it failed several times. mr. president, i give them a check mark on the chart for doing the minimum. my friend in the democratic leadership did at least bring up a bill. they did in fact bring up a bill. as the chart shows, the tax extenders right here due by one year are not alone. there's three other areas of unfinished business and others as well, but i just decided to talk about these. one area we discussed at length a couple weeks ago applies to millions of middle income families this year. it's the 2010 alternative minimum tax. another area is the death tax. in less than one month the number of states to be hit by the death tax will shoot

dramatically upward. as small businesses, family farms are going to be lost unless we do something about it, but here we are in the last few weeks of this session. they have not done a dog gone thing on the amt patch, and really the house did something on death tax reform, but we've done nothing and they have done absolutely flog on the tax -- nothing on the tax hikes. when compared with the compromise on the death tax reform, the number of taxable estates will be ten times higher. in the case of family farms, it will be 13 times as high. now, the 2001 and 2003 tax rate cuts right here. as important as extenders, the amt patch, and the death tax

are, the package down here is mon lific in comparison. i'm talking about the current law until the end of this month. i'm also referring to family tax relief. both pieces were the core of the bipartisan tax relief enacted in 2001 and free. for example, of the importance of this package, we need to look no further than a typical family of four. for a family of four earning $50,000 of income, the tax hike they face will be $2136. in in environment, who thinks it makes sense to hike the taxes to $200 a month? that's where we are, mr. president, unless we can get

this all done. you know, the other side cooperating, somes to me a family of four earning $50,000 will get socked another 2136 dollars. that's where we are. how could we possibly know -- just tell me, how could we possibly held hostage any bill with the votes the democrats have had over the last four years that means as much as these mean? the folks taking these partisan shots had almost four years with an overwhelming majority in the house and senate to deal with the massive tax hike set to kick in less than a month now. republicans -- we have not controlled the house for four solid years. for almost two years, the other side ruled with the most rebust society in modern times.

the house never solely determined the fate of any bill there. it's like wise in the senate. a filibuster proof majority has a lot of power, a majority lost needs to work with the other side, and that's the way the senate has always worked. even if we go to the side to filibuster, how could we have filibustered something that doesn't exist? look at the prior charts, not one dog gone thing done. it's something that hasn't existed for almost four years of democratic party control of both houses of congress. go back through the record. in the four years of majority, show me the senate democratic leadership bill that republicans could obstruct. there hasn't been any. yesterday, finally, the up action broke on the house side.

house democratic leadership sent a bill late in the second week of this lame duck session. the bill does not prevent a tax hike on virtually every american taxpayer, but what kind of action is the house bill? it's political action, pure and simple. it's political. in the statements of the bill's authors, the house kick leadership, we can view that as a partisan sentiments in the democratic caucus. it will not become law, and we all know it. it's up to the obama administration and the senate democratic leadership to work with republicans. the aim should be a by partisan transaction or deal if you want to call it. relegislating on these tax hike prevention issues is long past due. you can say it. long past due. what kind of action are the american people receiving from the senate democratic leadership? the majority leader has used his

procedural power to jam republicans. he has the right to do that, but it has been consistent. call a bill up, fill up the tree, prevent any amendments, and then try to ram it through. i have to say, these tactics jam any democrats who might differ with the kick leadership scheme -- democratic leadership scheme. there's some who do. the procedural jam is to guarantee that we will waste yet more proceed chiewl and more -- procedural and precious time. if you don't believe me, ask the national press corp. outside the senate chamber. taking a bet on a successful legislative outcome of the two jammed votes would not be a good wager. it would be akin to sign an offer to give the brooklyn bridge to the best talking new

yorker. anybody is fooled by this move by the senate democratic leadership, and i challenge any friends on the other side to show me the votes. how many actions have the democratic leadership passed that are designed to fail? maybe there's cheap political benefit to the democratic leadership and party from staging these jam votes. one democratic leader implied yesterday, maybe there will be some campaign material produced. is that what this is all about? is that what the greatest deliberative body is all about in the last few weeks of the session when this country is in the fiscal problems that it's in? i ask my friends to step back and look at the political calculation they may be making. the american people are angry. i know it. i held seven town hall meetings in the last few months, and people are very, very angry.

the american people know it's taken almost four years for our friend in the democratic leadership in both the house and senate to address this looming tax hike. they've had monumental majorities that would have enabled them to put anything through they wanted to. amendment tax hikes they all knew about when they took power long ago. is it really worth running through this political charade with jam votes and campaign commercials to use two years from now? is it? is it really that important? i'd ask my friends on the democratic leadership and the democratic side to consider the political calculations further. especially consider it when these two partisan jams, jam votes, fail. if you want to keep playing politics with the big tax hike on virtually every american, what will you say when we hit

the last day of this calendar right here? do you say too bad, american families? do you say too bad, small business folks? do you say jamming votes was the goal? what do you say after wasting the hard working taxpayer's money on these jammed votes? let's go to the allegation not helpful to the bipartisan deal. it's the second theme i refer. many on the other side describe republicans taking whatever action necessary solely to provide income tax relief for high income taxpayersment senate republicans and democrats want to prevent tax hikes on middle income families. the only difference is senate republicans want to do more. on this side, in this slow growth environment, we don't want to raise taxes on anyone right now. yesterday, i discussed some of the reasons for preventing any

tax hikes, even preventing the so-called millionaire tax hike. it's a hit of small businesses, and we all know it. it's a hit on the after tax rate of return on investment. this so-called quote millionaires unquote tax hike slows the life blood of business and business capital. let's be clear. on our side we do -- we do just as much as the democrats want to protect middle income payer from the tax hike. nearly every republican in 2001 supported it then, tried to make it permanent, and we support it now. you need to look further than the leaders bill that is right there in the bill. on our side, we want more of these middle income taxpayers to keep their jobs. we want a business and investment environment that reduces the punishingly high

unemployment rate of close to 10% now, and that doesn't talk about the underemployment rate more than 18% when you include people who don't want to look for a job anymore. those who have given up. almost four years ago in the 2006 election, the american people provided the democratic party leadership with control of the congress. in the 2008 election, almost two years ago, the american people provided the democratic leadership with the largest majorities in more than a generation. they also provided the democratic leadership with a president of their party. the democratic leadership spent the period of 2001 to 2006 thwarting efforts of the 2001 tax relief permanent. a final assuming control, they spent four years with no legislation, as you can see on this chart to make permanent or even extend the marginal rate

cuts and family tax relief packages. no senate legislative action. no senate committee and floor action. no senate action until this late lame duck session partisan jam votes. the senate democratic leadership needs to engage. engagement is defined as a constructive activity with the goal of changing the law. engagement is not defined as repeating a dead end partisan process like we've seen with the extenders bill, something we should have passed long ago and were willing to. time sensitive tax legislative business should go through the regular order of process. it's too late for that now as you all know, as we all know. it's too late for partisan

stuntings. the -- stunts. the american people need action. actions speak louder than words. it's too risky to aim for partisan stunts. the clock is ticking, and soon, this calendar in this year, right here, this whole calendar will be history. americans deserve real legislative action, and as i've said, it's one thing to man the floor and try to raise the thresholds and so forth on this late date, but small businesses are mainly partnerships, corporations, individual entities where the income comes to the small business person who in most cases if they want a business, put that back into opportunities to create jobs.

i heard the funny argument over the years, well, it's only 3% of small business. well that's $750,000 -- 750,000 businesses that create jobs in this society. i'd like to see jobs recreated. i'd like to see us do the things that we're here to do. i look at the white house, they have brilliant people in the white house. brilliant people, not one of whom to my knowledge has been really constructive in his or her lifetime in creating private sector jobs. they are great at creating public sector jobs as we have seen over the last couple years as jobs have jumped dramatically, but hardly anybody down there know how to create a private sector job.

i don't want to be mean to the president or anybody else. they are brilliant people. maybe there's something they can come up with, but they sure as heck aren't getting that through this session in a way that will create jobs. i hope that our negotiators on both sides will wake up and realize that we have to do what's right for this country, and we have to do some things that will help small businesses in this country help create jobs. in a time when unemployment jumped another to 9.8% and the unemployment rate was 18% last i checked, it seemed to me the worst thing we could do is mess it up with tax increases against everybody. now, i personally suggested thatceps republicansment -- that sense republicans want all of this tax relief in 2001 and 2003 bills to be permanent so we

have wanted that and the democrats have wanted only those 200,000 -- 250,000 and below those figures to have the tax relief, and they want their so-called middle class tax rates to be permanent which we will keep going because we care as much on middle class tax relief as they do. in fact, i think actually more. it seems to me, we ought to get together, and we ought to at least give this economy a chance over the next two or three years. as much as i want to make the tax relief permanent, give us a chance to be able to regenerate jobs in this society in ways that really make sense.

mr. president, keep in mind, when you start talking about this so-called millionaire tax, you talk about 56% of all capital gains rates paid by people, many who are small business people, who are and will create jobs if we get rid of the uncertainty that i have to say has been continue continuous over the last few years. i just hope we can get together. i hope no one construes my remarks as trying to pick on anybody. i don't want to do that. i just want to make the points because i think they are relevant, truthful, and frankly, it's time we get together and get these problems solved. i yield the floor. thank you. >> tomorrow morning, tax cuts are debated.

they convene at 8:15 eastern time with two hours of debate followed by a vote on the baucus amendment. it also includes tax breaks for capital breaks and dividend, unemployment benefits, and the estate tax among other provisions. we'll have live coverage here on c-span2 instead of our regular booktv programming. next, on c-span2, russian president gives his state of the nation address. the senate's armed committee discusses a repeal on the don't ask don't tell debate, and later, u.s. senate tax cuts set to expire this year.

this week russian president gave his state of the nation address including topics with nato and proposals to diversify the economy away from oil. in moscow, this is an hour and 10 minutes. >> translator: the president of the russian federation.

♪ ♪ >> please be seated. >> translator: dear citizens of russia, esteemed deputies, and members of the counsel of the federation. it was a year ago in this very room that i present as my political strategy. the idea was to rely on the values of democracy and modernize the economy and create inventives for progress in all areas to create a generation of individuals who would be free, educateed, and thinking

creatively and create a economy of a new level to reestablish russia as a modern world power that has achieved successes based on innovation. these processes and modernization in this country began amidst a difficult period of time for the whole world. it was a time when the world was struck by a global crisis, and also last year, who were in the middle of an unprecedented heat wave and forest fire, and yet despite all the difficulties, we on the whole have been able to do quite a lot, and i'm here to thank everybody who made a contribution to the rejuve nation of our society. we were able to stabilize our economy following a significant decline, and this year, the

economic growth will amount to 4%, although the prices are food, unfortunately, the world over, the prize of food has risen and prevented inflation from increasing rapidly, the three year goal is to reduce up flags to -- inflation to 4% a year in order to mitigate the consequences, almost 150 million riewg les were allowed and to establish this important area in the rural areas and improve the living in the regions from falling, and i will keep an eye permly how -- personally on how that is going. we have unemployed individuals, 2 million fewer than at the crisis which in itself is a

significant achievement. the sovereign debt is minimal. the current level of russia's international reserves, and that is almost $500 billion is considerably higher than in late 2008. following anticrisis measures that were unprecedented, we are now transitioning to what is now a more balanced budget policy. regrettably, the budget deficit still remains high. we will reduce it. all the leading world nations have taken on identical commitments and obligations. of course, the economy remains complicated, and some of the consequences of the crisis have not been overcome yet, and this has to be said directly for what it is. however, we will comply with our social obligations in an

unconditionble manner. the real population income over the last few months have grown by roughly 5%. for the next year, the wages of individuals employed in budget funded areas will be increased and targeted programs to provide housing to veterans and the military are being executed. we're finding opportunities to annually increase pensions, and the stated goal, goals that was stated by me to make sure that all pension is receiving titles that are at least as high as the assessment that is civil. that goal has been accomplished. ..

> translator: for a small business in the production or social area, two year transitional period will be provided for where the contributions to the health system will be effected at a lower rate. that of 26%. [applause] >> reporter: during this year, we have been purposefully working to implement projects in what are the main areas of technological modernization. our goal is to increase the energy efficiency of the economy by 2020. this goal is feasible and realistic. i have no doubt about that.

what it will do, it will reduce the industry expenses and save the personal funds of the individuals in the first place which could be the most important thing in terms of paying for housing and utility bills. and we have discussed this issue and reached the main conclusion. in order to prevent continued deterioration of the utilities and at the same time to more effectively use energy, private capital needs to be engaged more actively in the housing and utility sector. i have issued appropriate sections. i would like to say we have scored certain successes in the high-tech area. the nuclear power industry is now once again building on a regular basis and annually putting into operation facilities. currently nine energy units are being built in the country. and russia is implementing

projects in india, iran, china, and other countries. over the last three years, the contracts with the nuclear power industry with the machine building industry have increased by a factor of 10, and compared to 2005, a factor of 25. that is a very nice number. [applause] > translator: that of course also means budget director and employees for the industry. another subject. as far as the world rating, the so-called top 500 of the super computers, currently comprises 11 russian systems. next year, the productivity of the domestic super computer will increase by over 150%, making it one of the most powerful computers in the world. before the end of this year, the group will be completely formed

and over the next two years, the construction of the principal digital navigation maps will be completed and the systems -- systems satellite navigators will be applying and available. over the next year, digital access to the mandatory tv networks will be made available in most borderline areas. we have the broadcast network. this year we have taught the worldwide web to speak the russian language. it's important for the country, the rf domain is open and increasingly popular. quickly so. also we have started implementing a new strategy in the russian pharmaceutical industry. during the next few years, the

share of domestically manufactured pharmaceuticals are -- is to be increased from 20 to 50%. whereas innovation medication -- innovation-based medication will increase to 60%. it will make medications more accessible to the public. i hope that the exports of pharmaceuticals will become an important revenue item for the country. the most well known innovation project is the caucasus center. the project is already becoming reality. there's a -- there's a management team. there's also a special note that has been passed which is unique preferences for those that are part of the project. there are proposals from private and government companies who are ready to start working at early as today. i'd like to emphasize the text benefits and breaks and the government funding for research should be made available to any

and all who have ideas and who meet the established criteria. in addition, over the next three years, we are planning to spend about 30 billion right els along with industrial companies. it is not small potatoes. in the event of success, we will need to increase the funding for the program. another project that's important, is the project that involves turning moscow into a major international financial center. responsibility for! -- for implementing this project sits with the federal entities, and the new mayor of moscow. the work is already being contributed to by the major russian and foreign financial institutes.

i am positive here too we stand a good chance of success. also, the benefits of having an effective financial market will be obvious for both the public and the companies who will be able to take advantage of the entire spectrum of modern financial services. obviously for the whole country of russia due to the flow of capital in taxes received as a result of expanded economic activities. indeed, a great deal has been done. if, of course, we look at it from the perspective of just one year. i hope that everybody understands that we are still at the very beginning of the road. the resources that we have available to us have to be used not to patch up but to modernize the economy, to create new, competitive goods and services, to create millions of new jobs, to create a demand for innovation to promote, to expand

professional and social prospect of our people. i'm instructing the government to spend at least half of the saved expenses, as well as part of the additional revenue in the federal budget to support modernization priorities. [applause] >> translator: what i'm referring to are the well known increase in the energy efficiency of this economy, the development of new energy information telecommunications, and medical knowledges. it is on the success of all of these projects that the quality of life of our people depend on. dear colleagues, everything that i have just been talking about, modernization, it is by no means an end in itself. it is nothing but a tool. a tool using which we will be able to solve long standing problems in our economy and in the social area and to support

those who need that support more than anyone else. and to create an environment in which the talents of those who we are pinning high hopes on, that is our children. our young people. afterall, modernization is being pursued for them before anybody else or anything else. and we should not be ashamed for what country we'll turn over to our children and grandchildren. however, it is just as important in who's hands the future of russia will end up. 26 million children and teenagers who currently living in russia must be able to grow healthy, happy, and as full fledged individuals and to become decent and worthy citizens. this is priority number one for all of us. [applause] >> translator: thank you. taking care of the future

generations is something that represents and has the most reliable, smart, and noble investments. a society where in real fact the rights of children are protected, and his or her personal dignity is respected. the society is more kind and humane, but also society can develop faster has a favorable and more predictable future ahead of it. i believe that what we need dramatically is an effective government policy in the area of childhood. a policy that would be modern, a policy that would meet the interest of national development. and that is exactly why in this address i will give the largest amount of attention to this subject. and i will dwell on what, in my view, requires new solutions and new approaches. first on how to improve the

demographics. compared to 2005, russia has increased by 21%. this is among the best such indicators worldwide. infant fatality has dropped by a quarter. last year for the first time in 15 years, we were able to actually see an increase in the russian population. largely, this, of course, is the result of the workings of the so-called maternity capital, or payments to the new mothers of the national project health and other measures of social support for families. we have sunk our teeth in the demographics problem in the most earnest way. we have to understand though, over the next 15 years, we'll still be living through the consequences of the democratic define in the 1990s. however, the number of woman who can still bear children will significantly reduce over the next 15 years. this is a serious threat, this is a challenge entire nation.

what must be done? we have to make more accessible and of better quality both medical and social assistance for mothers and children and to develop the birth certificate program and treatment for children under three years of age for newly borns with small body weight. we also have to increase support for treating childlessness, including using invitro semination techniques. we need to modernize children's outpatient and inpatient clinics to improve the training of the personnel. as soon as next year, significant sources will have to be channeled. at least 25% of the funds collectively allocated for modernization of the public health system will have to be used to build up the children's public health system. this is a great amount of money. in practical terms, it may

amount to 100 billion rubles in the course of two years. today, almost 1/3 first graders have identifiable health issues. even worse is the stats when it comes to teenagers. 2/3 of teenagers have health issues. starting in 2011, i'm issues an instruction to conduct an in depth health checkups for teenagers. especially importance needs to be given to vaccination, to accessibility for children and teenagers of high quality medical preparations and early diagnostics in them of tb, and other dangerous ailments. these purposes -- these programs also need to be adequately funded. the third and highly important question is that of support for new and large families. one of the most acute problems and it remains that way is housing. starting in 2008, the law has

allowed to use the use of maternity capital to repay mortgages which has been signed up until december 31st, 2010. that is before -- that is without having to wait until the child turns three. this has been taken advantage of by almost 1/4 million of our citizens, whereas the housing market has been given an incentive, has been given a boost. which is important in the postcrisis period. i believe that starting next year, this regulation has to become permanent. number four, in expert opinion, the main path of overcoming the crisis is to increase the number of families that have three or more children. recently, i saw an interesting bit of information on the internet that concerned the all high territory where they were holds was an interesting social

advertising campaign. it's a simple idea. but one that i think is very attractive. that is to tell the public which of our famous russians happened to be born as child number three. among them are antoine, nicholas, and without the great individuals, without their creativity, and without their achievements, this world would be a different place. humanities would be poor both morally and in a culture -- and from the perspective of culture. therefore, i believe that large families the most favorite nation regime has set up in certain regions when a family has a third child. the decision has been made to provide to them free of charge a plot of land so that they can build a country house or primary residence. this is, i believe, is an appropriate measure and also example for other parts of the country to follow.

i believe this practice should be rolled out nationwide. [applause] >> translator: i'm also instructing the government jointly with the regions to work through the procedure of providing free plots of land for the construction of the first residence for a second home when a family has a third or a next child. of course, this rule could be phased in on the gradual basis given the specifics of the territories. in the region other forms of support for large family that can be taken advantage of. in the liana region, a 1,000 google certificate is issued to new families when they have a third or fourth or separate child. i suggest all of the parts think the regional maternity capital. this measure, obviously will cost money. it depends on how the things are in specific parts of the

restoration. but the results are worth it. number five, there should be additional tax references. specifically, the tax should be 3,000 rubles a month for every family starting with child number three. i'm instructing the government to prepare the appropriate proposals and increase the tax deductions for all families with children while reducing the so-called standard deductions which for the majority of the citizens of this country have simply acquired a symbolic nature. number six, many foundations, the mass media are organizing direct collection of funds for children suffering from grave diseases. they are also individual businessman who without advertising themselves, which is especially important, or supporting orphanaging, and investing in childrens recreation and sports.

we have been improving legislation on charity. however, the problems remain. for instance, a repeat charity action with respect to the child, even a child who's suffering from a grave disease is nevertheless includes in his or her parents taxable base. this is unfair. funds received to support children sent by charity organizations must be completely eliminated, removed from the taxable income. i am counting on this state to pass an appropriate piece of legislation a.s.a.p. according to the applause, this is what is going to happen. number seven, an issue that is extremely sensitive for new families that which concerns preschool establishments and kindergartens. wherever i go in this country, i'm almost always in meeting with local residents and asked this question. as of years beginning, a 1,0 --

1,674,000 are signed up for kindergarten. often the parents put their list before the child is born. it's because there's not enough vacancies that young families delay having children or limit themselves just to one child. here's what i suggest needs to be done. a program, a nationwide program, programs in every region should be established to rebuild the old kindergartens or build new ones that would meet the modern requirements or provide appropriate premises for them. and such requirements must be both well grounded and feasible. i already said they should not be gratuitous. second, alternative force of preschool education to be given support. in particular, a system of nongovernment children establishments and family

kindergartens and to consider reducing rent and establishing tax benefits on property tax for children who do not go to kindergartens, preschool groups in general education schools need to be established. dear colleagues, for two years now, we have been awarding the order parental glory. it's an order that was established my initiative among those rewarded are fathers and mothers of biological and adoptive children. we take -- we chose to take pride in such families. i have to tell you that frankly even just talking to them makes me extremely happy. when they come here to the kremlin to be given their state awards. unfortunately, in this country, to this day, 130,000 children are parentless. they don't have parents, they

don't have guardians, they don't have families. they are deprived of what is the main thing for them. family. and a great deal has to be done with the very notion of quote abandoned children unquote to become an an acronym. we must find foster families for children. there must not be quote nobodies children unquote in the country. [applause] >> translator: a serious problem is the correctional orphanages. they work to isolate rather than to create them and make them part of society. that's why what is happening there is something that both the government authorities and civil society must keep an eye on. custodial awards need to be

established at every orphanage at every correctional facility and those custodial must work in an open manner. also we need programs and social adoptation to company those who go to orphanages and then graduated. it's not enough to educate and feed children. we have to bring them into the new adult life and prepare and have self-confidence. this is not just something that teachers need to do and the local authorities. the local authorities, for instance, could pay for those who just left orphanages to undergo training within the system of secondary and higher professional education. our childhood policy is based on universal international standards, the declaration of the rights of children adopted by the u.n. assembly declares that the humanity must -- that humankind must give the children

the best of what it has. whereas the childrens right convention has established the priority of the interest of children before the interest of society and the government. in 2009, under the president, the institute of the commissioner for the childrens rights was established. and his work is cut out for him. last year, there were flagrant violations of safety norms in children's summertime facilities which resulted in children getting sick and sometimes dying. it's necessary to prevent the repetition of this. both local administration and supervisory authorities must in advance, now, start preparing for the next summer season. these are matters that have been to be the responsible for both the issues of children's rights, and there are those in already 58 regions of this country. by the way, i believe this institution could be established in virtually any constituent

part of this country. about federation. horrendous problem is violence against children. according to the official data of the minister of interior, in 2009, over 100,000 childrens and teenagers were victims of crimes. just think about this real hard. many facts turned inside out. children, mostly orphans, children from families that are not doing well are being dragged into substance abuse, drug use, prostitution, and other criminal endeavors. and the jerks that are doing that must be punished in the harshest of manners. [applause] >> translator: last year we provided for harsher punishment for sex crimes against pre-age

people. however, preventing such crime is just as important. i believe that once and for all, access must be closed to educational establishments to those who have ever been found guilty of any violent crime or dragged children or teenagers into criminal endeavors. such individuals should not be allowed to be close to children under any circumstances. [applause] >> translator: an appropriate craft with editions to the labor code has been submitted to the state, and i hope will be passed before the years end. members of the council have took into consideration to take care of the life and child is the direct responsibility of his or her family. it's more heinous when violence occurs in the family. it is known that cruelty

generates reciprocal. then they use it in their own lives, schools with armed forces, and in their own families. it's the duty of the entire society to create an atmosphere of intolerance towards any cruelty against children, to identify and cut short such occurrences. i note that in our region, crisis center have been set up to provide assistance in case of family violence and such experience has been amassed in st. petersburg, and in the direct, and must be rolled out elsewhere in this country of ours. there's another problem that i cannot be silent about. we virtually don't have any infrastructure to support the lives of people with disabilities or grave diseases. there's no way to say how hard

it is for school. it's torture to find a bus that's equipped to carry wheelchairs for children with muscular skeletal symptom disorders is a problem. and navigating around buildings or offices in wheelchairs is often just impossible. although i have to say that new houses that are being built, already built to new standards. and yet i have to say that people with health problems and restrictions nevertheless achieve very high results in sports. of course, what our pair -- para lympics have achieved,

creating full fledged environment for disabled children must become a priority in implementing a new government program called an enabling environment. [applause] ! >> translator: raising the future generations is linked with the assistance of modernizing the education system. as part of our initiative, the standard of early school has been renewed and centers for the high school has been changed as well. it's important that now in the middle of what is known as the teachers year, that new qualification requirements for teachers have been published. in addition, teachers must be given opportunities to undergo advance training in the best schools and in the best educational establishments. in 2011, 2,000 rubles were

dedicated. however, authorities must provide finance towards these purposes to school teachers have power that prime ministers can only dream of. that is what winston churchill said once. said this power must be targeted in a way as to open up the talents and capabilities of every individual child and to prepare him or her to choose the profession. that he or she will have. and for this purpose, first and foremost during 2011 for every school, a project of the school of the future must be prepared. the vision of how school can develop. developing this project is, of course, something that teaches me to do both current and former pupils and the parents. but i believe the regional authorities could develop a mechanism for their implementation by engaging business entities if and when necessary, second. it is necessary to complete creating the national system for

identifying and supporting talented children. it is important to be able to develop ones talent at an early age and everybody must have the opportunity, irrespective of where the children live. i'm instructing the government to take it into account as it produced new educational standards and to develop a rule for per capita financing for paragoge call and gifted children. :

teachers must know about th. raising children is something that needs to be done by both the educational system and culture and the society at large. we must create new qualitative -- qualitatively new and high quality films, movies, that will be of interest to modern children. let us remember what impact was made on entire generations by fascinating science fiction. we all read it that inspire children and urge them to fix their own discoveries an entire generation grew on those sci-fi books. more attention has to be given

to the patriotic education of the young people. yes, it is necessary after rejuvenate this effort by serious efforts by patriotic games, smart demand. they helped inculcate with strong character and teach skills that acquired the most complex conditions, and i would like to note the importance of the operations and that identify the names of those who died during the war and in such expeditions young people in the or acquiring the skills and patriotism not patriotism for short, but genuine patriotism. i spoke to the government to deliberate the observations and to update the monuments and everything is great in the area but i believe all levels of

government must be doing it, not just on the anniversary year like this one. number six, the strategic priority for the policy is to create and promote healthy lifestyle values. naturally this is not just concerned children. we must lead by example. elbridge entire society must get over infantile approaches when it comes to a healthy lifestyle. without educating oneself, it is difficult to educate one's children. that is what was once said, in the meantime, 80% of the russians do not engage in any kind of a fitness or sport. we are talking about for a five people. also, this country suffers from one of the highest levels of tobacco smoking in the world, and people are taking a both

tobacco and alcohol at an increasingly young age and those alcoholic beverages to those that come of age must remember that they will be sanctioned, including the go to jail for committing a crime. [applause] i hope the support you just shown me that provides for the responsibility for such sales which is currently will soon become law. the elimination to him on -- dependent what national legacy's we need despite the unique features and the nature. today it is not in the best of shape and the problem can only be solved by setting up a modern and effective environmental conservation and management system. the following has to be done in the short term.

the tradition of the territories must be delegated and this level must be seen as a benchmark, as a baseline in order to implement programs to minimize the negative impact on the environment and the previous environmental damage. certain experts also believe that is necessary to conduct the so-called environmental amnesty provided that a company undertakes very harsh obligations as far as environmental rehabilitation of production and the territory which it is based on and affect spirit i believe this is a reasonable and some idea, not just to repair those programs with those that actually implementing such programs and investing money in such programs. they should not be harassed with fines which will make it difficult for them and the mechanisms should be taken full advantage of private estate

partnership. also, the government must work out norms for the call the environment that might be specific attributes of the territories. this is the foundation for the activities of the national authority and the would be a very clear benchmark for the citizens and partners from other countries. number three, crucial principle role in the protection of the environment must be played by the civil society. i have heard more than once that environmental thinking does not take on, does not stick in this country because our society's aren't prepared for it. well, i guess perhaps that is partially true. that is why as mentioned before how great importance is the role of environmental the education and upbringing and that too must be taken into account and to do educational standards. the environment must be one of the key indicators of the quality-of-life and one of the key indicators of the

socio-economic of a limit of the territories and appropriately and must be seen as a criterium against which to judge the effectiveness of the work of local bodies of government and the heads of the editors of the federation are thereby instructed to annually report on the status of the environment and their regions and of the population of those regions must be fully and completely reliable informed as far as the non-governmental entities. those who are in real terms working to maintain the natural environment given the production and infrastructure must be engaged in a dialogue and acceptable solutions must be found by summing up this particular subject i would like to empathize childhood and the ten years the period of time when his or her future is defined.

, people open things for themselves, when they are not of it for anything, the immigration, the design to something new, the audacity of thoughts. these are all things this country desperately needs right now and we are counting heavily on the energy and ambition of the young and on their wish to work jointly to gather for the goals stated. members of council and federation, modernization creates a smart economy, but modernization requires a smart policy, one that ensures condition for comprehensive rejuvenation of the life of society. what we need is new standards in the operation of the government and the provision of public services, high quality of the work of the traditional and the law enforcement system and more interaction between the citizens in the developing of their communities and the greater

impact on the activities of municipalities. for this i am proposing the following steps. first, we have to achieve transparency and simplicity in the every day relationship between the state and the citizen. and i repeat, every day relationship. understanding of the fact that bureaucrats serve the people, rather than determine the people's states is the foundation of the space system. to the citizen, steve is a bureaucrat, a specific bureaucrat who has come to see, a judge who has passed a ruling and this is a case, a tax inspector or local policemen. anybody come any bureaucrat who is empowered to solve his problems, all as present in this room. the activity of -- activities of all officials such that must not disavow the state. their job is to improve the

quality-of-life of people. the standard of living. we are optimizing the system of providing states. even today, many regions of the country without the fee leaving your house you can electronically file for new passport [inaudible] amount that has already been accumulated conduct, to obtain a driver's license. so part of the news is already in effect. although -- and i will not hide it because people are writing to be -- the way the system works is that something people still have a lot of problems with. it has to be made to work better. the remainder of the rules will be effective this year. the most important of them is the principal of the one-stop window. people don't have to run around all kind of establishment and get the pieces of paper. as parents have to do, who have to take advantage of measures of

support for their children that are provided for the law. it is necessary to legislatively and make individuals who are officials responsible for violating the periods of time during which they are expected to provide government services, and i have instructed the government to provide such proposals within four weeks. second, modernizing the system of government of public service must be given to the public. i believe that we should more accurately involved in the provision of such services, non-profit organizations often in the field are better than even the coeditors and experience and they are helping people who find themselves in difficult situations. i believe the involvement of the nonprofit organizations can make social services more specific and more targeted and what is more important, it will reduce the level of corruption in the big government. the federal agencies must come up with a clear and transparent system of selecting nonprofits

for reforming such functions and selections should be made of organizations that have already -- that already have a good record and that enjoy -- that want trust among the public have been working for a number of years and who are based on organizations that have relevant experience. i am telling the government to finalize the legal framework for the involvement of the noncommercial organizations in the system of providing government social services and to use tenders to a greater extent in financing them. in every region, they're must be coherent program adopted to improve the climate and to create new highly productive jobs on the basis of the so-called best regional office. such include the reduction of the period of time, which is taken up by the issues of crime is required to start a business to create preparing industrial

sites and other measures. on the whole, we must encourage rather than discourage and support the regions that have been able to increase their own revenues. and to take this into account, as we distribute federal subsidies. however, even this is not enough. the government must prepare proposals to change the current proportion of the distributional revenue between the different levels as the result of such measures the role of the regions and municipalities in solving ki socio-economic tasks must increase. the bulk of the responsibility for the future or a region that fits with the governor. how successful his or her work is will be based on how much investment he has been able to correct and how many new jobs especially in the commodities have been created.

and the personnel decisions have to be related to that. number four, the bodies of government must get rid of property that is not directly linked to their direct conferences. always seems that there is no such thing as unnecessary or excessive property. in fact, managing excess of property requires a lot of strength, come investment, and everybody's here to know about that, a lot of funds which is the worst part. at because it often generates corruption. this year i have signed a decree to reduce by 80% of the strategic companies. my instruction to government has come up with a large plan to privatize large companies. the main goal of the privatization is to increase the efficiency of the companies and to bring to the economy additional investments and serious investments, whereas the

privatization proceeds will be used primarily to modernize this economy. appropriate decisions must be made the what the regional and local levels. the law on the general principles of organizing the bodies of of doherty of the constituent of the federation defines that property of the regional authorities can comprise property that is necessary for them to perform their functions and powers, therefore, other facilities and other pieces of property must be privatized. bodies of government must not own plants, newspapers and ships. everybody must do what he or she decide to do. [applause] five, modernization will only provide the expected effect when the society has fair laws, and ferre laws they're actually working when the independent and

respected courts and law enforcement agencies are functioning. those that in july true respect on the part of the citizens. all these links undoubtedly, of course all are linked among ourselves closely and the entire system of the reform of just individual institutions. that is why, along with developing the legislation of the judicial reform, which is something that we have been doing and are doing, we are reforming the minister of the interior and the legislative level creating an environment in which to improve the quality of the work of the investigative authorities and the prosecutor's office. to this progress, i have submitted to the state, to the draft legislation on the police and on the investigative committee of the federalan the regional and municipal leaders must prepare to effectively implement these new acts.

indeed, they have a lot of new things, and not to hide in their offices and watch criminal operators increase their activities and feel like they can get away with anything in their territory. they must do everything to make sure that people who live in their territories are not worried about their own lives and the lives of their families are not afraid to lose their health, property and human dignity. recently unfortunately a number of tragic events have taken result as which our citizens have come have been murdered. the of the reasons among others are the sloppiness of law enforcement authorities and the other bodies of government, and oftentimes, they're direct merger with criminal entities with regard to one such episode i have a decision to relief from his position the head of the department of the interior of

the territory, whereas if the general for the office, the efforts of the investigative committee have been instructed to make proposals regarding holding why of all individuals who worked in those individually areas of responsibility that were supposed to ensure enforcement. number six, in my previous address, i talked about the need to improve the criminal legislation, and that this legislation must be tough but at the same time modern and humane in the reasonable sense of the word, whereas restoring justice by way of the courtroom and for justice and the protection of the rights of the victims must not result in building up the criminal world with new blood. i will emphasize one more time, punishment for significant

crimes to the extent this possible must not involve the provision of freedom. this is relevant in the situation when we talk about young people, teenagers, first offenders. today i will submit to the state which will enable the court to apply a differentiated approach in assigning punishment in a number of different trends the lower limits of the sections will be eliminated and courts will have an opportunity to more broadly use such alternative measures of punishment as fines and community work. the main thing is the insistence of the lower limit of criminal sanctions of court should not see the upper limit as the only benchmark as the same punishment. the strength of the court is not as in the toughness of the punishment, but in the fact that punishment is irreversible and

inevitable. whereas the mission of the justice is not just to punish, but also to rehabilitate. number seven, our crucial goal is to continue to fight corruption. i believe the decisions have already been made are being executed and to keep moving ahead. experience indicates that even 12 years, 12 years behind does not seem to be enough to prevent people from giving bribes. on a number of occasions economic measures can be more productive, therefore the commercial bribery, the giving and the receipt of a lot can be punished with fines in the amount of up to 100 times the amount. in fact, the kind of criminal behavior has occurred as mediation and bribery of other

courts and other government bodies and the revenues it perfectly well there are a lot of scumbags who assure that they know how to take care of any particular court case and who and how much needs to be given to take care of that business. i believe that bribery mediation as well as many fines are to be made part of the criminal law. number eight, another subject that i would like to raise, i will not not demonize number 94 that everybody knows about. it has been criticized in a blanket ways to save the situation has reached the work of what is reasonable, and the goal stated in the mall unfortunately to what extent have never gotten off paper. nontarget expenses including the

direct effect kickbacks and misuse of funds amount to at least a thousand billion unfortunately, therefore we have to start working on a new edition of the law of government procurement. one that will be better fought through. [applause] i also believe that the plan there must be a special internet web site that will preliminarily publish information that will have feedback opportunity for companies regarding their enforcement in the tenders and expert opinion about the extent to which such plans meet this requirement and are in sync with the current crisis situations, so the next three years the forecast plans for the procurement of the state of that equipment and medication and high-tech products on behalf of

the government and large state-owned companies and subsequently and forecasting should be extended five to seven years in which case both investors and researchers will know exactly the product of the work will be in demand. for increasing demand of the year if technology can be accomplished for the modernization of the forces would you like it or not but in different periods of history science and technology were pushed ahead specifically by the defense means and the government in the new technical solution in the area of defense. the recurrence is facing the fundamental goal of creating the new high-tech and what we are going to do is to spend over 20 trillion rubles towards those services. this is a lot of money and such investments will pay for themselves and be twice

effective is that the end of the day to give us the use of the technologies, thus helping us to modernize production and develop the fundamental and applied research and university research. that is why we are setting up a special entity whose job will be to identify and develop breaks of technologies for the defense industry. such entities are in other countries where many of them will find a use in everyday life and most indicate to call the of life is the quality of the political system to improve it as the federal and the regional level in number of decisions have been made. as i stood up this very place back in 2008, i formulated to in positions and in 2009i formulated yet another ten positions which are involved in and purpose in the political system a democracy once again i would like to thank everybody who was involved in this discussing those initiatives and

the members of the council of the federal. at the self-government we need additional steps to be made local, self-government, an important element and the majority is virtually nonexistent as the local level of all the parties are functioning on the little old organizations and my proposals to make it mandatory to use proportionate to the electoral system after the elections of representatives bodies and in the municipal municipalities for the number of deputies at least 20. we set out to deeply modernize the forces. we have already updated the forces and the system of combat readiness and we also started conducting my regular basis war

games. next year the special focus has to be given to boosting this aerospace defense of this country and of modern russia definitely and it also needs to shed goals and functions that should not be performing. also, we are not just building of our armed forces but to some of the national cooperation in the security area. russia is prepared with the country to work on enhancing mechanisms of current directing recently at a russian major summit in lisbon i shared my consideration regarding the possible architecture of about a european abn system which would make use of the potentials of the north atlantic alliance and what put you up against missile strikes. our alternative is either we agree on an anti-missile defense

and create a joint mechanism for the cooperation were a spiral of the arms race will begin and we will have to make a decision on deploying new strike capabilities. it is completely obvious that this latter scenario would be very brief. in lisbon the decisions were made to build a modern partnership, a partnership based on the principles of indivisibility of security and mutual trust country's currency and predictability. we have determined how we will work and how we will work on the creation of a single space of peace and security in the region. this gives of some cautious optimism if you will in the prospects of working on the russian initiative concerning a

treaty. we have to build up economic diplomacy correlating its results with practical outcomes for modernization and the foreign policy must be expressed not only in missiles but also in specific and clearly understood achievements by citizens in the creation of russia are joint ventures and mentions of high-quality inexpensive goods and the increase of number of jobs and i should say that this approach has understanding and our partners and i believe that we should work of a targeted manner with countries and companies that are prepared for that thinks to the professional interest we already are she made up modernization partnerships with germany and france, great potential in the building of

inhibition component of the cooperation with china, india, brazil, republic of korea, singapore, italy, and several other countries in such partnerships will seek to accomplish the release of russia's technological modernization. the substantial reserve for reaching those goals i see an expanding the cooperation with the union and the united states of america and the mechanisms of the russia u.s. partnership must be used to establish full still economic consolation and improve the investment climate and ensure interaction in the high-tech area. the agreement between russia and the european union partnership for the modernization and that is an idea that we formulated its ackley a year ago must work on. first, it involves the natural extension technology,

harmonization of technical norms and regulations, practical assistance of the european union as far as russia's exception to the wto. second is a simplification of the visa regime with its complete elimination in the short term and third, considerable expansion of professional and academic changes. it is in this regard next week i will engage our partners in brussels that of russia european union. extremely relevant is the task of the regional integration and economic space of the asia-pacific. active use not being made of the potential participation in the forum and other forms which takes place expanding the relationships between the countries in the region requiring the strategic character and that is something

that is borne out by the example of the relationship with china and unprecedented level of cooperation projects partnership internationally and in turn is also helping increase the prestige and influence of such entities. serious reserve is available in terms of developing a long-term mutual beneficial cooperation with latin american and african nations of special priority importance with what his course and our foreign policy the cis and thus es keogh entities that are operating. we have set up a customs union and are creating the only single economic space within the year of sector framework. we are flying out new integration schemes and at the end of the day we should work towards building a single economic space stretching from the arctic to the pacific that

will take up the entire territory of eurasia. [applause] number eight, as it relies on the experience, technical and resources, russia can become the initiator of a global system of fighting merchants. effigy 20 summit i launched the initiative concerning the modernization efforts to preserve the marine environment from oil spills. now we have to tackle our main goal, the change of the best practicing in this area and prevention or liquidation of consequences of the oil spills. international flight to piracy must be made more energetic. we have lost initiative to the mechanism to try pilot.

we believe it will help bring pilots to create responsibility. after all it is the fact that they can get away with it that remains as an incentive for them. i am expecting the foreign policy agency to come up with specific results of work in all these areas. defense. together we have to implement the plans that have no point today. i have not the slightest doubt the world of great job at that. i would just add a few more words now, words that are normally not in official documents, but they could be the most important. we are rejuvenating this country. we are rejuvenating were society. we are changing our life, and we ourselves are changing.

and everything we are doing we are doing for those who are left more than anyone or anything else by our children. because we wanted them to live better than us. we want them to be better than us. we wanted them to be able to do things that perhaps we won't have time to do. so that out of their successes, a successful future of our great russia will come together. i am positive that this, indeed, will be the case. [applause] ♪

♪ ♪ ♪ [applause]

without the new s.t.a.r.t. treaty being ratified by the

senate we do not have a verification mechanism to ensure that we know what to of russians are doing and they don't know what we are doing. and when you have uncertainty in the area of nuclear weapons, that's a much more dangerous world to live. today, the joint chiefs of vice-chairman and the chiefs of each military branch gave the senate armed services committee their view on a possible repeal of the military "don't ask, don't tell" policy. there's testimony comes a day after defense secretary robert gates, joint chiefs chairman admiral mike mullen and the co-chair of the pentagon task force on the "don't ask, don't tell" all told the senate armed services committee that allowing gays and lesbians to serve openly in the military would not

harm ongoing operations. and encourage congress to repeal the 1993 law that put the policy into place. senator carl levin and chairs this three hour 15 minute hearing. hr >> good morning, everybody.ody. the committee meets this morninn to continue receiving testimonyr on the department of defense'snl report on implementation of a a repealed of "don't ask, don'tear tell."o yesterday, we heard from ga decretary gates, chairman of tha joint chiefs admiral mullen andc ine co-chairs of therk department's working group on this issue. today we hear from the vicehe chairman of the joint chiefs, the general james cartwright, and from the senior military

officers of each of the services. army chief of staff general george casey, chief of naval operations, admiral gary roughead, commandant of the marine corps, general james a. moss, chief of staff of the airl force, general norton schwartz and, what of the coast guard, admiral robert papp. the chiefs are tasked torain,anq organize, train and to cut ourfs military forces, that is an. emportant and challenging tasksw and we are all grateful to the surface of each of you to this nation.eal if we repealed "don't ask, don't tell," as i believe we should, the legislation stipulates that repealed will not take effect unless and until there is acatiy certification by the president,h

secretary defense, and the chairman of the joint chiefstede that the adopted the necessary implementation steps to assure ndar that we maintain our standards of military readiness and effectiveness, unit cohesion anh recruitinges and retention.e several of you have testified before this committee that pew hadh concerns about repeal ofe "don't ask, don't tell." you also testified that he supported secretary gatess' toad conduct the working group revie' and indicated that its findingsl might influence your view. we heard yesterday that yourhe views helped shape the workingo group's report and recommendations. and we heard secretary gates testify yesterday to the following. quote, i would not sign any

certification until i was satisfied with the advice of the service chiefs that we had in fact mitigated, if not eliminated to the extent possible, risks to combat readiness, the unit cohesion and effectiveness. closed quote. committee wants to hear from each of you whether you are satisfied by this assurance from the secretary of defense, and we want to know whether you are adequately consulted by the working group. the report before us confirms that are large majority of troops believe that repeal is consistent with maintaining unit effectiveness as do the secretary of defense and the chairman of the joint chiefs. the working group found higher levels of concern about repeal in some segments of the

military. such as the marine corps, combat arms branches of the army, and special operations forces. the working group found that training, education, and leadership, will be vital in mitigating those concerns. and of grate importance, the report demonstrates that actual experience serving alongside gay and lesbian colleagues has a powerful and positive effect on service members attitudes. to the co-chairs of the working group, jay johnson, and general carter ham wrote in their report, quote, while a higher percentage of service remembers in war fighting units predict negative effects of repeal, the

percentage distinctions between war fighting units and the entire military is almost nonexistent. when asked about the actual experience of serving in a unit with someone believed to be gay. closed quote. that is to say that predictions of negative effects are higher among troops in war fighting units. but the actual experience of troops in combat units who have fight alongside gays is that their units were largely unaffected according to the working group report. this evidence is confirmed by the experience of some of our closest allies who have made this change. in the militaries of great

britain and canada, there was even greater concern about this shift before it was made than exists today in our military. but the working group reports that their transition was smoother than expected, and that there is no evidence that a change in policy has diminished combat effectiveness for these allies who have fought side by side with us over the last decade. the working group has laid out a careful, deliberative plan to implement repeal while mitigating risks. while that plan focuses on the importance of leadership, education, and training. i agree with admiral mullen who told us yesterday it is leadership that matters most.

senator mccain? >> thank you, mr. chairman. let me thank our distinguished witnesses for their service to our nation. as admiral mullen noted yesterday, we have a group of officers that represent more than 100 years of experience in our armed forces. i welcome them. and i'm pleased that admiral papp and general cartwright are joining us as well. as i said yesterday, we are considering in these hearings a complex and often emotional subject. the proposed repeal of the current law, current commonly referred to as "don't ask, don't tell." which have held differences of opinion among many americans. it's no different among the u.s. military as the pentagon's report demonstrates. however, i think we can all agree that our military today is the most effective, most professional, and arguably the

most experienced force our nation has ever had. we can all agree that we appreciate and honor the service of every american who wears the uniform of our country as well as their families, especially during the time of war, regardless of whether they are straight or bay. and finally, i think we can all agree, and i certainly would, capable force could implement "don't ask, don't tell" just like they do everything else that we ask of them. what it is the congress of duty to determine is not can our armed forces represent a repeal of this law but whether the law should be repealed. unfortunately, that key issue was not the focus of this study. and let me say again just to be clear, i'm not saying we should hold a referendum among our military on this issue and leave

the decision in their hands. that's not how our system works, nor should it. what i am saying, and i repeal, that leadership means knowing what your subordinates think, including on whether they think the current law in this case should be repealed or not. but that is the fundamental question that must be answered by congress, not by the president or the courts but by congress. it's a question that must be answered carefully, deliberately, and with proper consideration with the complexity and the gravity of the consequences for the military and the wars in which we are engaged. i appreciated hearing from secretary gates, admiral mullen, general johnson, and mr. ham yesterday. all of the public servants occupy leading positions within the establishment. their views all deserve careful

consideration. the service chiefs are responsible for the training, organization, and administration of the men and women of their servicive -- respective services. it's their responsibility to recruit, and retain men and women for the services. it's their responsibility to recruit and retain the best personnel possible and to implement policies consistent with the law that produce fully trained, motivated, and disciplined troops for employment in military operations. and at present, that means sustained high tempo combat. in short, it's the job of the service chief to ensure that our military is ready and able to win the nation's wars. as such, their views are especially relevant to the current debate. i have always said, always said, that i would listen to and fully

consider the advise of our military regarding the potential repeal of "don't ask, don't tell." i did that yesterday. i will do that today. i will continue to do that. anyone who alleges otherwise is disregarding the regard. as we move forward with our discussion on this matter, i hope that everyone will put aside political motives and agendas. i hope everyone on both sides will refrain from questioning people's integrity. i hope that everyone recognizes that debate is focused not more on broader social issues, at society at large, but in our military and it's effectiveness. on this matter, i look forward to hearing the view of our witnesses. thank you, mr. chairman. >> thank you very much. we are going to start with the vice chairman of our joint chiefs, general cartwright. >> thank you, mr. chairman. >> general can i interrupt you

for a moment. i believe we have a quorum that's present. that means we can quote on the conformation. quorum now being present. i would ask the committee to consideration the nomination of general claude kaylor. it's been before the committee for a required length. is there a motion to move. >> so moved. >> i second. >> most carried. thank you. general. >> thank you, mr. chairman, senator mccain, and distinguished members of the committee, good morning. i appreciate the opportunity to comment on the final report of the comprehensive review working group regards the potential impact of repealing 10 usc 654

and associated department of defense policy commonly referred to as "don't ask, don't tell." the secretary and chairman emphasized early in this process that our men and women in uniform deserve to have their voices heard. i want to begin by remarks by commending the working group to reach out and ensure the opportunity to participate was broad and far reaching. as expected, the they that gathered reflects a wide range of views on the servicemen and women in the u.s. military who are known to be gay or lesbian. if the law is repealed, implementation will require the deliberate and disciplined attention of leaders at all levels. it's my view, implementation of a new department policy would involve manageable risking with regard to military effectiveness.

even during the high tempo of war time operations. some ask, why not wait for some more timely opportunity. there's never a perfect time. change challenges organizations. however, contrary to expectations, this maybe a better time than one might expect. periods of reduced activity can create conditions wherein the challenges associated of making of change any kind seems enormous. but contrast, in times of conflict, the focus is on the war effort. u.s. service members are devoted to deserving our nation and their comrades. when they are engaged -- when they are engaged in combat operations, they rely on the warrior ethos of the men and women, not presumed or known at to do -- attitudes or lifestyles. from my experience and reinforced by the findings, i

believe the men and women are the most well trained in military history. they look at terms of accomplishment, and look beyond issues of race, religion, gender, and sexual orientation. in my opinion, the findings of the report confirm this view. the opinions are important. i respect their opinions. it's accurate that predictions by service members and combat arms unit were higher than the predictions of men and women in supporting organizations. any good survey though, asks key questions in multiple ways. what stands out to me when we viewing the report is where a sign to combat arms or units, service member who's have actually serve with people known or suspected of being homosexual are almost universally experienced -- they have experienced little or no disruption. it is right to be concerned

about how the organization as a whole might be impacted by the repeal. but when based on actual experience our service members seem confident in their ability to service professionally and effectively alongside gay and lesbian service members. i'm inclined to trust the real world experiences of our men and women on the battlefield. recently, we faced the very real potential. the law would be repealed in the courts. my greatest concern, should the law change through the judicial process, is the department may lose it's ability to transition in a way that permits the managed. repealing the law by the act of congress, on the other hand, offered the greater likelihood that the department will management legislation. they can provide the structure and predictability that the civilian and military leaders require to effectiveness and efficiently implement a change in policy. we pride ourselves as a nation that does not merely tolerate

diversity, varying organization and attitudes, we embrace and are strengthened by the many differences among us. the strength of our nation is the willingness to acknowledge the views, exchange in the debate and at the end of the dialogue, unite under the rule of law and pursue the interest. the character in appeal lies in it's equality, opportunity, and the inclusionive character of our organizational ethos. being more inclusive improves the institution as a whole. strong and committed leadership has plotted the course of the u.s. military throughout history. it is a certainty that change brings challenge, and challenge demands leadership. the quality of leadership that is a hallmark of our military institution will be the determining factor on the question at issue today. my faith in our leadership from top to bottom and the fair minded temperament of the american people,

representational benefit derived from being a force defined by honesty and inclusiveness, rather than by concealment causes me to favor repeal of title 10 u.s. code 654 and the associated policy known as "don't ask, don't tell." >> thank you, general cartwright. general casey. >> thank you, mr. chairman, senator mccain, members of the committee, good morning. >> good morning. >> i've reviewed the final version of the associated working group's report. i want to be able to provide my informed military advise to the committee. i'll begin by relating how i see the military risks -- the risk from a military perspective. then i'll give you my views on the impact on the force if "don't ask, don't tell" is repealed. first, i think it's important that we are clear about the

military risk. implementation of the repeal of don't ask don't tell would be a major cultural and policy change in the middle of a war. it would be yeted by a force and leaders that are already stretched by the accumulative effects of almost a decade at war. it would be implemented by a force in which a substantial number of soldiers perceive that repeal will have a negative effect on effectiveness and the morale and that implementation will be difficult. further, the report clearly states that over 40% of the combat arms soldiers believed that the presence of a gay service member in their unit have a negative impact on the unit effectiveness on the trust that the soldiers feel for each other, and on their morale. as such, i believe that the implementation of the repeal of

"don't ask, don't tell" in the near term will one, add another level of stress, two, be more difficult in our combat arms unit; three, be more difficult for the army than the report suggests. that said, if repeal is directed, the implementation principals in the report constitute a solid basis upon which to develop plans that will mitigate the risk that i just described. properly implemented, i do not envision that the repeal of "don't ask, don't tell" would keep us from accomplishing our worldwide missions, including combat operations. we have a disciplined force, and seasoned leaders who with appropriate guidance and direction can over see the implementation of repeal with moderate risk to the military effectiveness, and moderate risk to our ability to recruit and

retain over the long haul. i do believe that we will have to closely monitor the impact on our mid level officers and noncommission officers as they wrestle will implementing repeal simultaneously with the other challenges that they will facing after nine years at war. it's my judgment we could implement repeal with moderate risk to the military effectiveness and long term health to the force. tell me close by saying if "don't ask, don't tell" is repealed, the army will work to implement repeal in the same fashion that is characterized our service to this country for 235 years. thank you, mr. chairman. >> general, thank you. admiral. >> thank you, mr. chairman, chairman levin, senator mccain, and distinguished members of the committee. thank you for the opportunity to appear before you today to address the report of the comprehensive review working group in my perspective of the issues associa