this bill is about our first responders. this bill is about our heroes and their families. this bill is about the victims who have lived at ground zero. this bill is about the children who are currently suffering from asthma, the most vulnerable in our communities who could not tolerate these toxins in their bodies. i'm going to tell you about three individuals whose story are particularly moving. at a time when most people were running away from lower manhattan, joseph rushed to the world trade center site as an ironworker for these rescue efforts. for 28 days joe helped cut steel beams on the pile to find survivors and to clear debris often sleeping on the floor a nearby office building rather than returning home at night. in the years following his

dedicated work at ground zero, joe was diagnosed with sarcodosis. he suffered from constant joint pain, see diseurs, blackouts and relied on dozens of different medications, unable to work for years, joe had to fight to get his workers' compensation for his illness. in october joe passed away at the age of 43. he left behind his wife and his daughter allison. joe's wife laura recently wrote me a note of plea. she said, "our financial situation is bad. i mean, bad. for six years i've had to beg for help, borrow from family, and i just can't do it anymore, and i shouldn't have to. we need to reopen the victims' compensation fund." this bill is also for people like frank varoene of

california. he was the division chief in california with thousands of milesway from new york city on 9/11 fighting wildfires. along with thousands of other brave men and women who came from all across this country, chief ferrone came to aid rescue workers at ground zero. he had seen his fair share of destruction during his career but nothing prepared for for what he saw at ground zero. he worked 16-hour days with fellow rescue workers inhaling that toxic dust that left him with lower respiratory airway disease. living far across the country, he still feels the effects of working at ground zero, which he says limited his ability to respond to other disasters like hurricane katrina. he has had difficulty getting health care in california for his ailments and says that living out here in california, "i cannot get confirmation or even a face-to-face with anyone

affiliated with 9/11 health issues. i do not know at this date if i am going to be covered for my health concerns. what happens when this health issue disables me and i can no longer work and care for our family?" our needs would meet the needs of this man and this hero who came to help when he was needed. the last story i'd like to give is that of robert helmke. he died at the age of 43. from stage four met it is a stick colow colorectal cancer cd from inhaling and swallowing the toxins at ground zero. he was 43. i am 43. he worked numerous hours at the world trade strvment he ate food and inhaled the toxins while he was working. at no time was he instructed ever to wear protective gear or any kind of breathing apparatus, nor was he told by our

government that the air was in any way unhealthy or bad for him. stage-four met it is a stick colorectal cancer affects the upper g.i. tract and it is very rare in someone so young. he was told that treatment would not cure him. it was t. would only help him to liver a little longer. i want to read to you his reaction to the diagnosis in his own words. he said, "talk about crushing news. my wife and i sat in the car and cried as i asked her what did i ever do to deserve this? on july 11, 2506, i had major surgery to remove two tumor parts from my small colon and have radiation on the large tumor in my liver. before nigh surgery, i had four chemotherapy treatments and was in an emergency room three times to be treated for dehydration before finally having to go on an all-liquid diet and intertra

venous feeding. i was a wife degrees at that and two young children garrett and amelia who have seen my illness worsen. things are being takenway from me, my work, food, helping others and caring for my family." officer helmke died in 2007. these are the stories that really tell us what this bill is about, men and women who are suffering, men and women who have died, men and women who have suffered so much because they did the right thing. what message are we sending here from this body, this esteemed body, if we cannot help those who kim to our reserve sciewrks who were there to find survivors, who were then to find remains and who were there to do the cleanup when our government asked hem to help? you must remember the days after 9/11.

this country would have done anything to help those who had suffered so much in new york and across this country. this was the most deadly terrorist attack in the history of america, and now, nine years later, this body cannot come together to do what's right? this is the clearest example of right versus wrong that i have seen in this body in my two short years. we must recognize the undeniable obligation that we have, a moral obligation to protect these men and women around their families because they did the right thing. it is now time for this body to do the very same. thank you, mr. president, and i suggest the absence of a quorum. sphear officer the clerk will call the roll.

the presiding officer: the clerk will call the roll. quorum call:

quorum call:

quorum call:

mr. reid: mr. president? the presiding officer: the majority leader? mr. reid: we're now in a quorum call? the presiding officer: yes, we are. mr. reid: i ask unanimous

consent the call of the quorum be terminated. the presiding officer: without objection, so ordered. mr. reid: i move to proceed to calendar number 662, s. 3991, public safety employer and kpwhr employer cooperation act -- employer cooperation act. the presiding officer: the clerk will report the motion. the clerk: we the undersigned senators in accordance of the provisions of rule 22, hereby move to bring to a close debate on calendar number 662, s. 3991, the public safety employer-employee cooperation act of 2009. mr. reid: i ask unanimous consent that reading of the names be waived. the presiding officer: without objection, so ordered. mr. reid: i now withdraw that motion. the presiding officer: the motion is withdrawn. mr. reid: i move to proceed to calendar number 695, s. 395, emergency senior citizens relief act and i have a cloture motion at the desk referencing that

matter. the presiding officer: the clerk will report the motion. the clerk: cloture motion. we the undersigned senators in accordance with provisions of rule 22 of the standing rules of the senate hereby move to bring to a close debate on the motion to proceed to calendar number 65, s. 3985, emergency senior citizens relief act of 2010, signed by 18 senators as follows. mr. reid: mr. president, i ask unanimous consent that reading of the names be waived. the presiding officer: without objection, so ordered. mr. reid: i now withdraw that motion. the presiding officer: the motion is withdrawn. mr. reid: mr. president, i now move to proceed to calendar number 663, s. 3992, the development relief and education for ailing miners act of 2010. i have a cloture motion at the desk. the presiding officer: the clerk will report the motion. the clerk: cloture motion. we the undersigned senators in accordance with the provisions of rule 22 of the standing rules of the senate hereby move to bring to a close the debate on the motion to proceed to calendar number 663, s. 3992, the development relief and

education for alien miners act of 2010, dream act signed by 19 senators as follows. reid of -- mr. reid: mr. president, i ask unanimous consent that reading of the names be waived. the presiding officer: without objection, so ordered. mr. reid: i now withdraw the motion relating to that matter. the presiding officer: the motion is withdrawn. mr. reid: mr. president, i now move to proceed to calendar number 651, h*s 8 -- h.r. 847. the presiding officer: the clerk will report the motion. cloture motion we the undersigned senators in accordance with the provisions of rule 22 of the standing rules of the senate move to bring to a close debate on the motion to proceed to calendar number 641, h.r. 64 1, the james zagroda 9/11 compensation act of 2010.

signed by 17 senators as follows: reid of nevada, gillibrand, schumer, casey, murray, franken, bingaman, cardin, inouye, bennet of colorado, shaheen, menendez, boxer, lautenberg, dodd and durbin. mr. reid: mr. president, regarding the h.r. 847, the zagroda legislation, have we stated that motion and have i asked that the reading of the names be waived? the presiding officer: the motion has been state and the names have been read. mr. reid: mr. president, i now ask unanimous consent that the cloture vote on the motion to proceed to calendar number 662, s. 3991 our upon the conclusion of the impeachment proceedings and the senate resume

legislative session. and that the senate then resume the motion to proceed to calendar number 662 and the mandatory quorum required under rule 22 as it relates to all these matters and i filed cloture on be waived. the presiding officer: without objection, so ordered. mr. reid: mr. president. the presiding officer: the majority leader. mr. reid: i ask unanimous consent the senate resume consideration of the articles of impeachment against judge g. thomas porteous -- let's try this again. his name is judge g. thomas porteous jr. the district of louisiana, that that consideration that we're going to do on the articles of impeachment, we ask that that begin tomorrow morning at

10:00 a.m., tuesday, december 7. at that time the commencement of arguments by the house managers and counsel for judge porteous, motions filed by judge porteous with regard to the impeachment articles and the secretary be instructed to notify the house of representatives. i further ask unanimous consent that each side be permitted no more than one hour for arguments on all motions. that counsel for judge porteous be permitted to open and close the motions argument. i further ask unanimous consent that after recessing for the weekly party caucus, the senate reconvene at 2:30 p.m. for the party's final argument on the merits of the articles. i ask unanimous consent that the parties have each one and a half hours to present arguments on all four articles, which under the impeachment rules will be open and closed by the house managers with no more than two individuals speaking for each side. i further ask unanimous consent that at the conclusion of the hours allotted for final

arguments, the senate shall immediately meet in closed session to begin deliberations on the articles of impeachment in accordance with the impeachment rule 20. i ask unanimous consent that the individuals listed on the document i send to the desk be granted the privileges of the senate floor during all open sessions on the articles of impeachment against judge porteous are under consideration. the presiding officer: without objection, so ordered. mr. reid: mr. president, i again stress the importance of all senators attending the impeachment proceedings. i urge all senators to be in the senate chamber at 10:00 a.m. for a live quorum which will begin prior to the commencement of the impeachment proceedings. each senator has an obligation to participate in the case. and his or her office be present and informed and participate. phr-pd, i would say that this -- mr. president, i would say this type of kpwraoefplt -- impeachment proceedings happen only a few times in the history

of the senate. it is important all senators participate in this. mr. president i now ask that we proceed to s. 4010. the presiding officer: the clerk will report. the clerk: s. 4010, a bill for the relief of caguryamatto. the presiding officer: without objection, the senate will proceed to the measure. mr. reid: i ask unanimous consent that the bill be read three times and the budgetary paygo statement be read. the presiding officer: without objection, so ordered. the clerk: . the clerk: this is the statement of budgetary effects of paygo legislation for s. 4010, budgetary effects for the five-year statutory scorecard, zero dollars, total budgetary effect of s. 4010 for the 10-year statutory paygo scorecard of zero dollars. also submitted for the record is a table prepared by the

congressional budget office which provides additional information on the budgetary effects of this act. mr. reid: mr. president, i ask consent that the bill be passed, the motion to reconsider be laid on the table, there be no intervening action or debate ant any statements related to this bill be placed in the appropriate place in the record as if read. the presiding officer: without objection, so ordered. mr. reid: i ask consent that the judiciary committee be discharged from further consideration of h. con. res. 259 and we now proceed to that matter. the presiding officer: the clerk will report. the clerk: h. con. res. 259, concurrent resolution recognizing the 500th anniversary of the birth of italian architect andrea paladio. the presiding officer: without objection, the committee is discharged and the senate will proceed to the matter. mr. reid: i ask that the concurrent resolution be agreed to, the preamble be agreed to, the motion to reconsider be laid on the table, no intervening action or debate and any

statements relating to this hear the be placed in the appropriate place as if given. the presiding officer: without objection, so ordered. mr. reid: i ask now, mr. president, we proceed to s. res. 695. the presiding officer: the clerk will report. the clerk: senate resolution 695, recognizing the 20th anniversary of the national institutes of health office of research on women's health and so forth and for other purposes. the presiding officer: without objection, the senate will proceed to the measure. mr. reid: mr. president, i would first like to note that the main mover of this matter, senator mikulski of maryland, she worked very hard to recognize this important office and she did it for a number of reasons. so which -- some of which i worked with her on this. there was a massive he study done on the effect of aspirin of people taking it as a way to alleviate heart problems. i don't remember the exact

number, but it was a huge number of people were tested, like 10,000. not a single woman. it was all done with men. so that kind of raised the ire of barbara mikulski and we found in doing this there were many situations where the diseases we tend to focus are disease that's related to men. -- disease that's related to men. an example being a disease i got involved in early on about the same time we did this. it is a disease that 90% of the people have the disease are women. it can best be described as the pain is shoving slivers of glass up and down someone's bladder. the pain is excruciating and awful. it was a disease -- a disease that people said was psychosomatic because it was only women that had the problem

and so they overlooked it. if it had been men, because we were an all-male legislator at the time. i'm sure it would have gotten more attention. because of barbara mikulski and i added my assistance to this, we were able to establish a protocol at the national institute of health and now this disease, people understand it. it's made a lot of progress. this is only one example of why the work of barbara mikulski has been so important to. i ask unanimous consent that a resolution be agreed to, the preamble be agreed to, the motion to reconsider be laid on the table, no intervening action or debate and any matters relating to this be placed in the record at the appropriate place as if read. the presiding officer: without objection, so ordered. mr. reid: i now ask that we -- i ask unanimous consent that when the senate completes its business today, it adjourn until tomorrow morning on tuesday december 7. following the prayer and pledge, the journal of proceedings, the

morning hour be deemed expired, the time for the two leaders be reserved until later in the day, and senate resume consideration of articles of impeachment as provided under the previous order. i further ask consent that at 12:30 the senate proceed to legislative business for a period -- for a time to do morning business. with senator lemieux recognized to speak up to 15 minutes. following his remarks the senate recess until 2:30 p.m. to allow for weekly caucus meetings. the presiding officer: without objection, so ordered. mr. reid: let me just make sure, mr. president, that we have this down right. we are going to 12:0 we'll proceed to hedges -- 12:30 proceed to legislative session an during that there will be one senator to speak, senator lemieux to speak for 15 minutes, following his remarks the senate will recess until we complete our weekly caucus lunches. mr. president, senators should be on the floor, as i indicated, for the mandatory live quorum to

begin the impeachment of judge porteous. there will be two quorums. one at 2:00 p.m. 30. one at 5:30. if there is no further business to come before the senate, i ask that it adjourn under the previous order. the presiding officer: the senate stands adjourned until senate stands adjourned until

>> without a 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 the russians are doing. and they don't know what we're doing. when you have uncertainty in the area of nuclear weapons, that's a much more dangerous world to live in.

>> securities and exchange commission chairman, mary schapiro, tacked to account this morning about new rules coming out as a result of the 2008 financial crisis. as part of a conference hosted by the american institute of certified with the contents. it's about a half hour.

>> good morning. i'm chris holmes of ernst & young and chair of the fcc regulations committee. it is my on it this morning to welcome sec chairman, mary schapiro for our keynote address. chairman shapiro will be speaking with us for about half an hour. hopefully there will be time at the end of the remarks to take questions from the audience. i do encourage you if you have questions to fill out question chitin cinema. so please join me in welcoming sec chairman, mary schapiro. [applause] >> good morning. thank you very much for the introduction, chris. it's a pleasure to be here today because you are working so critical to the effective functioning of our markets. it is through records that investors investors receive a timely, reliable and comparable information needed to make informed investment decisions.

and it is through the decisions of fully informed investors that our markets are able to efficiently allocate the capital that fuels innovation and growth in our economy. unfortunately, the scandals and crises of the last decade understandably have shaken the public's trust in america's capital market. for some time now, the sec and other regulators have been working hard to restore that trust. but this goal goal is not one that can be achieved by regulators alone. the accounting profession at the very important role to play as well. in fact, one of the first rules we adopted after he became chairman was one that recognized the importance of your profession to the functioning of our financial markets, a rumor we sought to leverage the knowledge, judgment and expertise of certified public accountants. it was early 2009 and we wanted to find a way to provide greater assurance to investors, that their accounts actually have the money that their investment

advisers said they hope. we enacted rules and called upon independent public accountants to serve as a second set of eyes in support of our investment basics emanation teams. the rules mandating a surprise examinations of advice or help account by independent public accountants. in addition, when an appraiser or philia serves as custodian of client assets committee feistiness attenuates report prepared by an accountant that is registered with the pca opiates to ensure appropriate internal controls are in place to protect client assets. as a result of that rule, we believe it will be more difficult for an appraiser was misused investor has said to get away with at the session. currently we're complicating ways to further leverage the profession by updating the custody role for broker dealers as well. i rule requires auditors to provide assurance that the numbers are accurate as well as controls and compliance. but the rule 17a five was first

implemented nearly 30 years ago. and so among other things, we're considering strengthening current plans controls over the commission foundational financial responsibility and customer protection requirements. we're considering preparing a 21st century foundation on which to pcaob can implement new oversight authority over broker-dealer audits. we're considering eliminating regulatory overload for broker dealers that are also custodians have a registered investment advisor. and were considering enhancing oversight of broker-dealer custody by providing new information and tools to regular examiners. what's more, our actions will underscore your importance to the financial system. of course custody rules have been far from her only can earn recently and our efforts range well beyond areas that directly touch the accounting profession. i think it's fair to say that

our investor protection efforts have been in overdrive for the past two years. since i writes, we might finally our enforcement units, so those who may be tempted to harm investors have a real fear of being caught. we adopted comprehensive rules to strengthen resiliency of money market funds and rules that give investors better information regarding the qualifications of their advisers and the fees they are charged. he became a detailed review of the structure of today's high-speed computer-driven markets, a review that position us to respond quickly to the events of may 6th circuit breakers and other measures intended to reduce the chances of another similar event. and more recently, we've stepped up efforts to increase transparency in areas that maybury systemic risk, like the asset-backed securities market and private funds. and since the passage of the dodd-frank not, we have begun to create contours of a new

regulatory regime around over-the-counter derivatives. these are just a few highlights of a robust will make robust warmaking agenda that is the cornerstone of our efforts to restore faith in our financial market. bobo making nr over forums are not enough to achieve that goal. i believe that effective coordination between regulators and accounting professionals must be an important part of that effort as well. in fact, in our quest to restore confidence, there is one very in particular we cannot dismiss without your help. one barrier against which you have to lead the fight and that is the investor skepticism that springs from a decade they perceive is marked by restatement, misleading windowdressing and quarterly report and off-balance-sheet exposures that prevented them from making fully informed investment decisions. the fact is that an essential touchstone of functioning capital market is an investor's ability to get an unvarnished

assessment of a company's financial condition. that is why the foundation of successful market is accurate and transparent financial reporting and honest verification of that reporting by an independent objective party. on the commission's role in promoting uniform principles for these vital tasks is an important chapter in our history. by trade and transparent reporting becomes detailed reporting from every burden of an enterprise can which generates numbers actually out of but the bottom line. it doesn't end there. that's because accurate reporting is also about tightly, full and fair disclosure of those numbers. it's about getting to numbers that mean the same thing from company to company and from country to country. and it's about pushing back to assure yourself that investors can rely on those numbers. i appreciate that you have a difficult job translating an increasingly complex and global

financial world into something that can be understood not only are market professionals in regulators, but by individuals with less investments or sophisticated financial training. i recognize that your responsibilities are only growing. as we all appreciate today's capital markets are far more complex and is navigated by the accountants inform the aicpa's predecessor organization more than 120 years ago. your profession fundamental role remains very important than ever. as spelled out in your code of conduct is to just treasure duties with integrity, objectivity, to professional care and a genuine interest in service to the public. that is why we see her profession as an important line of defense. an ally in the effort to protect our markets and the quest to restore investor confidence. of course remote investors the

most visible font is on enforcement efforts. one of my top priorities on returning to the commission was restructuring our enforcement unit and streamlining our enforcement procedures. today our enforcement teams continue to pursue cases stemming from actions that contributed to the financial crisis of the past several years and these have included successful actions against countrywide, american home mortgage company century and citigroup. in these cases, public companies failed to disclose millions of dollars in losses and billions of dollars in exposure to subprime mortgages. these material facts, when unidentified, or in some cases actively concealed by the preparers and executives charged with making them public. their failure is not only called immense economic damage to shareholders, but to the financial markets and the economy as a whole. we continue to demonstrate a willingness to prosecute those who put betray the trust of public markets.

bring inactions after the fact substitute for full and honest disclosure at the outside. enforcement actions are cold comfort for investors who lost their savings after warning on misrepresentations or half-truths. and too many investigations, we have been struck at the magnitude of the misrepresentations we uncovered, even when these investigations led to high profile cases against ceos or cfos, controllers, as in the types of cases i just mentioned, they can also raise troubling questions about the many others involved in preparing and auditing the filings and reports. we wonder if questions could have been asked early on by preparers and auditors or forming plans were ignored. we wonder if the eventual losses to shareholders and investors were multiplied many times because material information was not made available in a timely fashion by people who should've

been able to produce accurate disclosures. rather than sec prosecution after the fact, shareholders should be able to rely on effective auditing upright and transparent financial reporting. i urge all of you to ask yourself the critical question when you sit down with the numbers. questions like, could i be doing more to ensure that the information is accurate? are the results of reporting an exercise in which i'm thinking our true report of actual results? do i understand the company bothered you well enough to recognize red flags and have i taken all necessary steps to respond to them? even if the numbers reported are accurate come today compared a picture or a disclosure? at these questions do not yield the answers you need, i urge you the courage to challenge the scissors come a willingness to take your judgment about the quality of disclosures to the

highest levels of management into the audit committee. that said, we appreciate that it is not always pleasant to report results that are not ideal. and we know this firsthand. earlier this month, the sec completed our performance and accountability report. it's really the equivalent of a company's annual report i posted it online. our gao audit found that the financial statements and notes included in the report were presented fairly and in conformity with u.s. gap. there we discovered to material weaknesses in internal controls over financial reporting. while it's good to know what the weaknesses are, they are in no way acceptable and we are already moving to address them. they will be migrating our core financial system to assure service of the office of management and budget with proven ability of the high standard the american people deserve. just as we relied on our

preparers and auditors, investors rely on you to find and identify weak this is so they can be addressed. your honest assessments are what the accounting standards and vision, with a good management team expect and what investors and capital markets deserve. of course the challenge of restoring public confidence is complicated by the fact that today's investors rely not only inaccurate information about u.s.-based entities, but about entities across the globe as well. today it to some investor trading on the new york stock exchange may be trying to analyze the german chemical company with subsidiary in thailand and chile and the powers they spotted her. the sec is working on several fronts to bring regulation like the more complex reality of today's financial world, to bring into cross-border consistency to accounting and auditing. for instance, we're supporting

the pcaob and if it suffers to remove obstacles and kept it from carrying out its congressionally mandated responsibility to inspect non-us firms registered with them. i applaud the recent e.u. decision that allows the pcaob to negotiate agreements with individual countries that will permit the pcaob to perform its inspection role. and i look forward to the final agreements with the individual countries that will allow those inspections to go forward. in this in another important area, we are now looking forward to a pcaob that functions with renewed energy and effectiveness in the months ahead. for many months, as you know, two positions on the board were filled on an interim basis by members whose appointment had expired and once he remained vacant. this was largely the result of a constitutional challenge to the very existence of the board. but what the supreme court summer ruling, the fcc is now searching for a new chair into

newport members. ensuring that these positions are filled with the individuals of integrity and spotless reputations demonstrated commitment to the interest of investors and the public is a top priority. we are now in the final steps of the selection process. i want to be the first to say that during a trying time, i think the board did an extraordinary job, but we are excited at the prospect of dedicated and highly qualified members and aboard able to focus on the critical role without a legal challenge over his head. in addition to the pcaob negotiation, there is of course another international issue of significant issue to the fcc and the accounting profession. in addition to international auditing responsibilities, we are of course focusing on accounting standards and convergence. because investors should be able to make accurate comparisons or judgments regardless of an entity's line of business, ownership status or corporate

domicile. they monitor the progress being made by the fasb and the pcaob on accounting standards. as expected, path towards convergence has been steeped in line at times, but both words have responded to challenges. for example, fasb will allow board members to discuss and resolve issues face-to-face. they have increased efforts to work through unified teams which include members of both words. both have committed to periodic public reports on the status of their efforts. i believe these actions will continue to increase the effectiveness of the collaborative efforts by the board and i'm sure that fasb leslie chair leslie seidman and sir david tweedie will have much more to stem the subject when they join me tomorrow. convergence is a top priority

for the sec, but if both boards recognize resulting standards in addition to being uniform must be high quality improvement over current standards. constituent review and comments are important parts of the process that will produce high-quality standards that investors need. for example, they were the driving force behind the board's decision to modify reprioritize the standard being developed on a joint agenda. the resulting staggered schedule for issuing the exposure draft will allow for greater input by stakeholders. this will create enhanced ability to see whether standards results in the consistent high quality globally except it standards and solutions we seek. hopefully many of you have had a chance to read the progress report by the fcc stepped away we posted in a sober. i still hear later, the staff is

highlighted several preliminary obligations based upon their work today, including observations on imports and implications related to different methods of potential corporation. the iasb funding model and the important role that could be played by fasb if the commission were to mandate ifrf for the companies. i remain optimistic about achieving a convergence that benefits investors in the u.s. and around the world. a significant portion of the work plan remains in progress in the commission looks forward to receiving continued periodic reports from the start and to make more progress in the year ahead. today, investors are turning to shake their skittishness. they are asking everyone for regulators to accountants are doing the jobs they expect us to do and that is a fair question. and because investor caution makes it harder for dynamic enterprises to raise the money

they need to expand and grow, it's important that investors get the answers they need. i believe the sec is on track doing the job that is expected of us as a rule maker and examiner and a law enforcer. but the importance of the accounting professionals cannot be overstated either. it's not just new rules and regulations that protect investors. if accurate, honest and complete accounting by men and women who, as chief justice burger wrote in u.s. beer at the young demonstrate complete fidelity to the public trust. our markets are not competent investors and their confidence rests in part in large part in your hands. i know that's a great deal of responsibility, but that the important role you play. the sec and other agencies can increase confidence investors bring to our financial markets. their efforts succeed only those investors believe the numbers you right on the bottom line. thank you very much.

[applause] okay, the first question relates to the ifrf work plan and what are my personal expectations regarding when will the commission make a decision on adopting ifrf for u.s. companies? what is the commission likely to decide? and one is a limitation likely to occur? okay, i'm not answering the middle question. you know, it is still our plan to make a decision on incorporation of ifrf into the u.s. reporting system next year. and despite a common perception that it will be by june of next year, we have not taught ourselves to the june date. so sometimes next year, we expect to be able to make a decision. one of the reasons we have the

staff so vigorously engaged on the work plan and make an in progress is so everyone can see the areas where we think significant progress has been made. implementation -- one of the things heard in response to the comments when we republish the work plan in february with a great desire pretty much across the board. and while ifrf does not by any stretch uniformly embraced by u.s. public companies or by investors, there was a lot of unanimity around if we go in this direction allowing sufficient time for companies to adjust. so i think it's likely to be a minimum of four years although again not the specific decision point for the commission. after remake the more fundamental decision about the extent to which, if at all, we will be incorporating ifrf. next question is some seem to believe the sec's timeline requires the commission to

address possible adoption of ifrf beijing 2011. however that time it was established before the passage of the dodd-frank wall street reform and protection act. given rulemaking dodd-frank requires the next 12 months as june 2011 real estate? how do demands of dodd-frank affect the timeline clicks as i said, we are not strictly committed to a june 2011 decision day, but rather sometime in 2011. i will say that while i'm sure you've all read in the press we have an extraordinary amount of work to do with respect to pcaob. over a hundred will strike, many within the first 12 months, certainly within the first 18. twenty studies to create within the agency. i will say that only a small amount of that burden has fallen on the office of the chief accountant and jim kroeker can

probably speak to this later, much of the burden of dodd-frank rule-making faults in other, most notably tradename markets world the truth of its regulations, division of investment management for the private funds regulation and division of corporation finance for the new public company disclosure requirement have been decreed by the law. so i think they will be able to not have ifrf or other accounting initiatives related in any way by the pcaob effort. many of those who have commented on the possible ifrf have been larger companies, investor groups and on difference. how will the sec identify issues and concerns of the rest of corporate america i.e. the vast majority of domestic registrants, investors and audit firms who do not have the resources to a comment letters

are to invest in preliminary valuations of the effective adopting ifrf? it's a great question and one we focus on. and i worked then, you will note that we talked extensively about our desire and really neat and determination to understand what the impact of incorporating ifrf would be a smaller u.s. companies who might not see the benefits frankly of being comparable and having comparability with issuers and other countries just because of the nature of their shareholder base. you're highly focused on the costs and burdens of foreign companies. we did actually get quite a number of comment letters to raise that issue. we try to make the comment process very simple. it doesn't have to be -- don't have to hire a law firm. you don't introduce sophisticated analysis. you can e-mail it to us to a comment mailbox. we try to make it as simple as possible for smaller companies and those who can't fix them the

resources of time to go out and hire somebody to write a full-blown comment letter. so we have actually heard from lots of smaller companies and our office chief accountant made an effort to reach out to smaller companies to understand the issues they tank ifrf uniquely present for them. but i would encourage you to make sure that your clients views are heard at the sec directly. the next question i can take a sip of water is on the core disclosure project. about a year ago, we heard about a core disclosure's project to review the commission's disclosure requirements and evaluate whether they should be revised to elicit the right if not more disclosures. we haven't heard much about this since then. what is the status of the?

do you think we'll see any action anytime soon? when we announced the core disclosure project and our defense i would say was a longer-term project. it was before dodd-frank was being passed but we anticipate about the work has been particularly for corporation finance division. but we do think that it was very important to put out on the record so we could begin to get comments and commentary from others are desire to really review all of our disclosure requirement for a deceit, to understand where we have repetitive disclosure, where he had disclosures that no longer are relevant, where we have cops were disclosure might be more appropriate. i would point perhaps where windowdressing proposal that we did in august or september of this year is one of those areas where beside captain disclosure. as a way to try to take a coherent and cohesive look at all of the disclosure obligations to minimize

redundancy in particular. so we have an internal task that's working on it and they've been working assiduously over the past year. i can't tell you a timeline for when we might see the larger picture unveiled, but it's still very much one of those projects along with market structure, along with proxy plumbing that we are not going to lead the push of the agenda just by the exigencies of the current one making workload. what changes have been made or are anticipated to be made to the sec's internal structure to meet the deadlines imposed by the dodd-frank match. for example, even the kitties make the two meet the mandate. can you describe in general discuss that you expect to focus

on, lawyers or accountants -- accountants? and which areas you expect to hire the most people. we were also criticized for being a number lawyered agency. and i actually take exception to that, not because of a lawyer, but because we we're on fact and law enforcement agency commissar lawyers are very important to us and we also read a lot of rules to deal in the law. there is a great need at the sec for accountants were really critical to almost every division in every function we perform. also from less traditional skill sets in the context of the work of the sec. we've been bringing in people from trading desks, investment banking firms, credit rating agencies, from hedge funds, from financial and risk analysis organizations, from risk management operations within a kind of financial entities. we've had tremendous response to the positions that we've posted,

including in areas like quantitative analysis, which has been very exciting for us. and in just the last year, in terms of the numbers of people we've brought in with your skill set, they are not huge numbers, but they are significant. they are high focus for us in the recruiting area and they're making an enormous difference. i can tell you what we had to reconstruct the trading from a six, which is a convoluted difficult process and the marcasite because there's not a single audit trail that lets us look at all the order and transaction data in one place. we have to assimilate -- assemble and analyze audit trails are mounted in different ways but different data contained in each event. had we not had some of our new risk management employees and people who were used to handling massive amount of data, and might have taken us even longer than the project did take. so we are finding that in the

enforcement as well, people with expertise in structure projects are enormously helpful to us in understanding some of the projects that wall street introduced over the last several years and what their impact was on the markets. when looking at algorithmic traders having kwanzaa can help us understand how algorithms operate in different market stress scenarios enormously helpful. so throughout the organization, we really tried to focus on bringing in skill sets that help us keep up with wall street a little bit better. in addition, we created a division of risk, strategy and financial innovation which is a locus for a number of these new skill set that were solving them throughout the agency is well and they are giving us the ability to think about how to connect the dots more effect only in how to take a more interdisciplinary approach to some of the problems we see. so if they work in progress for short, but it's very exciting to see the sec bringing this new

talent. lots of dodd-frank questions. will move away. proxy access. the commission's proxy access rules are being reviewed by the court of appeals. will this cause the rules to not go into effective proxy season? if the ruling strikes down some or all the new proxy house rules, which you expect will happen next? well, when the sec was sued by the chamber and others over the proxy access rules, we actually made the decision to suspend effect is that the rules during dependency of the legislation. we do not want companies to go through the proxy assess process and then be left in a very difficult situation at the quarterback invalidated the rules. so they will not and are not in

effect for this coming proxy season. if the ruling strikes down some or all of the new rules, would have been thanks totally depends on what the court says to us. and there could be a range of outcomes there and it wouldn't really want to predict what those might be, but will have you see what court says and respond accordingly. i will tell you we feel very confident about rules we think the day were well done and done for all the right reasons and will improve governance in this country. and so, we're going to obviously defend them in the court of appeals. and there is a flashing red light here. >> yeah, unfortunately -- i had a microphone. unfortunately, rather time. but please join me in thanking chairman schapiro for joining us this morning and getting us off to a great start. [applause]

>> you're looking for w. in washington d.c., where senators will convene a rare live quorum call at 10:00 tomorrow morning eastern time here diapering all the senators to the floor to begin impeachment proceedings against louisiana federal judge, thomas porteous. that's expected to last two days and will have life senate coverage here in the spin to. >> middle and high school students, as you are and your documentary for c-span student can document icon here's a few tips from our judges.

>> one of the things i look for when watching your videos is he listed them. i want to see you in your personality that helps finger video stand out from all the rest. >> what i like to see most in the student cam entries are a real investment in care and the topic that you'll be telling us about. he sure to be interested in what you're telling us. if you're not interested much representing, chances are we probably won't be either. one tiebreaker formula last year was a requirement of using the c-span video. i'm looking for videos for people afflicted looked at the c-span video content and have said what elements make the most sense for telling the compelling story i'm trying to tell? >> for all the rules, including deadlines, price information and how to upload your video, go to studentcam.org. >> the supreme court heard oral argument last month in schwarzenegger versus potter, a case centering on prison health

care and overcrowding. the high court will decide whether a federal three-judge panel greatly ordered the release of 36,000 to 45,000 california inmates addressing prison overcrowding. this is about an hour and 20 minute. >> 091233 schwarzenegger p. potter and the related cases. mr. phillips. >> thank you, mr. chief justice. may please the court, but we have is an extraordinary and unprecedented order issued by a three-judge district court required the release of between 36,045,000 inmates currently incarcerated in the california penal system within a two-year period. the order in this particular case has made particularly remarkable because it strikes me at a minimum it is extraordinarily premature, but it may come at some point of this process but in order,

probably substantial and smaller in scope may become appropriate. but this is supposed to be in order or remedy of last resort with the district court has done here is leapfrogged a series of steps that should then take into how does going this particular route. >> one case in 20 years -- >> that is correct, justice ginsburg. >> so it seems to me -- it was something like 70 auditors from the district court, the single district court in that case. >> that's absolutely true. >> how much longer do we have to wait? another 20 years? >> now, justice ginsburg. ..

z >> if it turns out we are not making progress -- >> excuse me, could you tell me from your briefs, i can't understand what the alternative steps are. the court below talked about some proposals like instruction and said, the legislature had struck them down. there's the fiscal crisis that has gotten worse, so construction is really not an option. i don't see how you wait for an

option than doesn't exist. they talk about hiring more staff, but the conclusion was that even if you maximize the staff, which you need to cure the constitutional violation, so tell me what specific steps outside of this order should have been given time to be implemented because the receiver had basically said i've tried, and the small progress we made has been reversed dos the population just keeps growing, so we can't get ahead of the problem. slow down from the rhetoric, and give me concrete details about what the least restricted means would have been other than to say that it's back to a receiver and special master who are saying we don't have a solution.

>> well, i think outside -- >> i don't think that's a fair characterization of what was said. >> counsel, that was one statement years ago. if that's all you're relying on. tell me -- give me concrete steps that are less restribtive. >> look at what the receiver has done over the course of the period of time since his appointment, and particularly when the second receiver was put in place. first of all, 89 hurksz was en-- 8900 was enacted, ground has been broken, facilities are in place. there's been success in the hiring process. we're close to -- >> is there in fact less overcrowding? i thought what this case was all about the receiver said the special master has said we can't make any progress at all until the there are fewer people.

you have no place to put clinics. the last steps given what we are dealing with here is that we have fewer people, so there is more room for these health facilities, more room for staff to operate. >> right. justice ginsburg, the fundamental issue in the case is what is the real cause of the constitutional violation here, and the real cause of the constitutional violation has also been the culture for the disregard of the inmates. what the receiver was put in place for, the reason he was appointed and properly so with the state's consent, not over our objection, was to change that culture and provide one construction, to provide increased numbers. >> yeah, but you can't provide construction when the state doesn't supply the min for it -- money for it. >> except in the august 2008 period of time, literally

hundreds of millions of dollars have gone to construction specifically, and more than $4 billion have been spent on the provision of health care in this particular system, and a great deal of that is because of the receiver. >> did there are these rate changes and circumstances so that now medical care can now be administered in something approaching a decent way, you could go back to the single district court and say i'm moving on to 6 # 0b -- 60b, circumstances have changed. it's no longer the case. it's impossible to run this decent health care. >> justice, i don't think we can get that relief from the single district court unless you are asking me to remove the entirety of the claim. the order says we have to get to

37.5% of the design capacity within two years is a three-judge district court decision. >> go back to the panel that you were invited to. it says if circumstances change, come back. >> that will always be the case. the fundamental question here is congress shifted dramatically the aploach that you're -- approach you're supposed to take in this context. this is supposed to be matter of last resort to give the receiver -- >> the receiver said in two paragraphs as you read that, it sounds as if overcrowding is a big, big cause of this problem which is horrendous which if you think it is accurately described in the case in the first page, two paragraphs, that's a fair description frustrate record. it's a horrendous problem. in the receiver says

overcrowding is a big cause of it and then he said you actually can provide care and the plan and turn around plan believes we can provide constitutional levels of care no matter what the population is, and then you look at the care in the turn around plan, and it says spend $8 billion building more buildings, and then the legislature rejected it. okay. there we are. more time? what's supposed to happen? >> the legislature proved a smaller, but nevertheless a mountain billion dollar construction. >> did they agree, it was 2.35, did they approve that in >> yes, they did. >> they approved 2.35? >> yes. >> is there any evidence that suggests that 2.35 is significant to cure the constitutional violation. >> i don't know if it will get you -- >> the answer is no. there is no evidence. >> there is evidence that the receiver asked for contempt for not getting the $8 billion, and

withdrew that motion so there is some sense in which the receiver is somewhat satisfied with 2.35, but again, this goes to the fundamental question the court should have evaluated in the first instance which is are we ready yet to give up hope at this point. >> what the receiver says about the 2.35 that it is a significant step further. it is certainly better than no construction at all. however, that is not equivalent to a conclusion that that current compromise will result in sustainable institutional health care at current population density levels. that's what he said about it, so we have his views, and i'm back to my question what else is supposed to happen? >> justice breyer, when the receiver says that, now remember, he says at current population levels, he doesn't suggest, and his brief is very

clear, that it doesn't urge this court to affirm the particular order in this case, and -- can i just finish this? >> yeah. >> the population levels have dropped pretty significantly since august, the trial on this particular case, and given the actions by the legislature in ab18, actions of the legislatures in ab900, there's substantial reductions in the population size, and so therefore even under the receiver's -- >> but do we have information about that substantial reduction? i mean, in this reference it seems to be that no matter how many efforts have been made, the population goes up, and now you say that the population has gone down. what point in time and how much has it gone down? >> well, it's down to around, as i understand it about 147,000 up

from a high of 165-170,000 and dropped because they will change in the good time credits and there's transfers. that was the purpose of the governor's proclamation. >> it's possible in the two year period you're going to hit the mark? >> if that's what -- that's what the three-judge panel said which is if you implement most of the proposals being made, you are likely to hit the mark, so what you're saying is you're going to do it, # and if you don't, they invited you to come back, and you really don't think if you hit 140 percentage, that the court is going to order an immediate release of the 2.5% over the limited set. it's going to ask you what have you put into place to reach that level over what additional period of time. >> i mean, there's a course where the federal is an answer and a basic forecast chiewl

point -- factual point to be made here. i'll make a point that is important which is that when we made our initial proposal to the three-judge court suggesting what we thought would be a reasonable reduction within a reasonable period of time it was met with emotion for contempt and some of rejection out of hand. >> so what are we fighting about? are we fighting that the plan was wrong, or are we fighting about that you're angry that you were told to do it in two years opposed to in doing it in 25 years. is that what you're suggesting? >> no, this is the federalism point. >> can you do it in five years? >> i don't know. if balancing all the policies that the state has to take into account, can it get there in the best interest of the state of california, if it is, yes. >> suspect it to -- isn't it to deliver adequate constitutional care to the

people that is incarcerates? that's a constitutional obligation. >> absolutely. california recognizes that. >> when are you going to get to that and avoid the needless steps reported in this record? when are you going to avoid or get around people sitting in their feces for days? when will you get to the point where you deliver care that is adequate. >> don't be rhetorical. i'll do my best, thank you. [laughter] if you look at the receiver's 2009 review coming out in september 2010 specifically says there's been a downward trend over the past four years. the 25 suicides in 2009 were 6 # 0% and the 9 homicide were 69% of the average. that's an improvement. the answer to the question, justice, is that the record in this case was cut off in august

of 2008. >> the problem i have with that, mr. phillips, is at some point the court has to say you've been given enough time. the constitutional violation still persists as the state itself acknowledges. the first outing is the principle cause as experts testified, and it's now time for a remedy. the court can't tsh did has -- it has to focus on the remedy, and that's what it did which seems to be a perfectly reasonable decision. >> i agree with what you say and even the last statement because you needed a significant remedy. there's no question about it, but you got a significant remedy when the receiver was appointed in 2005 and implemented a program in 2006. >> how much time do you think the receiver needed? how much time should the court have given the receiver to develop his plan and implement

his plan? >> well, justice, there's no significant timeframe. obviously, we believe we're entitled to a reasonable opportunity to comply with the orders and bring ourselves under compliance president >> the state said if it had 7 years it could get down to 137.5, and they didn't seem to object to that. >> justice kennedy, given all the other constraints, there's a difference between what you do under the hammer of a district court order com is what we have under these circumstances and what the state will do. that said rntion the state is absolutely committed. again, going back to what is the root cause of the constitutional violation. it's not overcrowding. i mean, when california violated the constitutional rights of the mentally ill in the 1990s, was prisons were not crowded, but because there was a lack of atentativeness in the circumstances. that's unfortunate to be sure,

more than that. that was the reason to go back to your point, justice kennedy, that's why the receiver to confer upon a private individual, the entire authorities run. the department of corrections, not just a facility or anything like that, but the entire department of corrections, medical health provision, is incredible. >> but i thought that officer himself said i can't do this without as a first step reducing the population. nothing else is going to work until we reduce the population to the point where there's rooms for cline ins, room for -- clinics, rooms for medical personnel to operate. i mean, that was the view of the district judge, the special master in one case, the receiver in the other case, everybody all

agreed reducing the population is not going to cure it, make everything perfect, but without doing that as a first step, nothing, there will be no cure. >> well, justice jins birring, -- justice ginsberg, even if you accept that, the idea of a 137.5% design cap that has to be implemented within fewer than two years is a remedy that's neither necessary nor sufficient. it is not aimed at the specific class. it doesn't remedy the specific federal rights as required by the prisoner's litigation reform act. >> i don't get that because what -- you can't have a remedy just limited to the class. the class wants to have clinics. they want to have personnel who function outside of a boom closet, so you can't deal with

this problem by just dealing with the mentally ill, the people with medical problems. you have to provide space for facilities. >> i think, justice ginsberg, the point here is it may be you have to get to that stage, but if you look at the receiver's report since august of 2008 which consistently analyzed this issue, and they say we've been able successfully to bring in personnel and have significantly larger numbers, we know there's construction in place, it may not be as substantial as i originally proposed, but it is nevertheless significant, and congress was explicit that the remedy of a federal release order should be the remedy -- >> let me recite this. what i did -- it refers to online evidence, and i went and looked at the pictures, and the pictures are pretty horrendous, to me, and i would say page 10 of the

religious groups brief, for example, shows you one of them, and what they are saying is it's obvious. just look at it. you cannot have mental health facilities that will stop people from kill themselves, and you cannot have medical facilities that stops infection in conditions like this, and then you look at it. now, you've looked at them. i've looked at them, and what is the answer to that? there's nothing in here that the special master said $8 million is the answer. they had some closed. how can i, if you were in my position, what would you say in an opinion that says that these three judges who have 200 pages of findings, what would you say as an answer to what i just said? >> i would say that the prisoners litigation reform act has a series of very specific

requirements that the federal court has to comply with, and that in deciding to go to a three-judge district court in the first instance, you have to examine the orders in place, and whether those orders had a reasonable time in which to operate. >> yes, but the state did not claim that either order in either case has succeeded in achieving a remedy. you never claimed that. >> well, it depends by what you mean -- >> just while i have your attention for a moment. i have in problem with the case. overcrowding is of course always the cause. if i'm looking at a highway system, i need to know the number of cars, or bad service in a hotel it's the number of employees per guest. that's fairly simple. i recognize, of course, that congress had imposed a special duty on us, but i think it means that overcrowding must not be ordered unless that is the only

remedy in a permissible period of time, and it seems to me there's massive expert testimony to support that proposition on the part of the prisoners. >> i mean, it seems to me that first of all, i'm not sure that's consistent with the language. it's the primary cause of the constitutional violation, and not the premare impediment of the specific remedy. i think that's still a difficult and open question as to how to proceed, but it's still strikes me that the sequence that congress envisions and the one that would make the most sense and ultimately the one to accommodate both the mr. plaintiff's interests and the department of correction's interest to allow the receiver to stay on course that will in fact get you there. again, one of the flaws in the case is nobody doubts for a moment that there have been very significant violations of constitutional rights years gone by, and indeed, a failure on the

mental health side to ultimately get to the point where we are, in fact, providing a significant remedy. the reality is in the course of the last three to four years under the guy guidance of the receiver who coordinates with the special master on the health side with the state of california, there have been significant movement in the right direction, and if the court had not jumped the gun and said, look, we're not going to let that play out, but leap ahead to a three-judge court, go to the prisoner's release order, this process would have played itself out, and we wouldn't be here right now. >> all this talk about what the receiver may think can be done seems a little bit perplexing to me because the receiver did not testify by the three-judge correct; is that correct? >> we were not allowed to question him. >> now he submitted what is styled in the meekest brief

where he doesn't address issues of law. he explains his views about, he tries to explain prior statements and supplement those prior statements. is that proper? >> again, i'm a long time believer that meekest briefs are open to whatever you want to present on them. >> i mean, is that true? can a witness submit a brief that consistents of an avid? >> no, that's not appropriate. >> i thought that statement was filed because the in your presentations about the special master and filed that brief to say you must understand this in context. i was making a speech at a club, so he wanted to put in context what you had used, you had quoted your statements. >> to be sure, although candidly

we had referred to the same statements in the litigation, but this is has been a part of the case for quite some time. i don't know what motivated the special master to -- or a receiver to file an out of time brief, but we didn't object to it as long as it was in the mind to hear from the receiver. i think the most important part of that to keep in mind is the receiver didn't ask this court to affirm. he clarified certain statements made and tried to say as described put them into con terks, and that's fine. we don't have any quarrel with that particular presentation, but i do think to say that the receiver has up cysted that he -- insists he cannot get to a constitutional permissible result without the order that's been imposed in this particular case is simply not consistent with the record. >> well, the experts testified to that effect.

>> well, experts reached that specific conclusion, but this court -- >> and the strike force and the government's commission reached the same conclusion, strike team i think they call it. >> right, but again, there's a very, very big difference on what you need to accomplish in order to remedy whatever the constitutional violation is. recognizing in the first instance that the biggest element of the 8th amendment violation is the difference prong which absolutely seems to me to be eliminated by the conduct of the state over the last three to four years. >> what specifically will happen? at the moment we can go through we have these briefs, all the experts, all the reports, everybody's saying you need to spend the money, and we have if you really want to cure the constitutional violation, we have the legislate cheer rejecting 8 million, but supports 2.35, and so, and nothing and a void, and give us

more time. i mean, i read the newspaper, it doesn't seem like california is voting money for new programs. what is it specifically that would happen that would cure this problem were we to say, i mean, a big human rights problem, what would happen if we were to say, no, this panel is wrong? what would happen that would cure the problem? >> it depends on how -- >> a constitutional prop which the state itself admitted is constitutional, a governor saying publicly there's a tremendous safety and health problem in the prisons, what would happen? >> well, if the court were to conclude that the three-judge panel should not have been convened, that's one outcome, and if they approve it was great to prove it at 37.5, either way it goes back to a court of equity. the receiver is in place with a plan in place as he is

implementing as we speak. >> what piece of it -- you said something about the 2.35 million, they didn't get the 8 million, but they got 2.35 billion and then i'm just looking at this brief for the receive. there's a footnote. there's 11 footnotes, well, that money is not there, it's dependent upon several approve priewfls not -- approvals not yet securitied. ultimately the approvals may not be forthcoming. >> i mean, 400 million has been spent. the rest is earmarked for this particular purpose, and the expectation from the state of california is that money is going forward. construction is as we speak underway. what we do know is the receiver was given a check -- >> i think you said earlier this

was a done deal, the 2.35 billion, but this is saying not so. >> the receiver is saying it's not etched in stone. i understand that. our assumption and our expectation and our belief is that that money is going to be used for construction. there are projects that are finished. there are projects underway and projects to begin within the next six weeks, all of which is funded out of that 2.35 -- >> one project that the committee said no, we're not giving you money on that. >> they asked for additional information, but again the expectation is that that money will ultimately be approved and that facility will be built, and we are moving along very rapidly to get that construction underway because we are talking about enormous facilities under these particular circumstances. >> mr. phillips, my trouble

listening to you is it seem z as though you are asking us to refine staff. you have judges involved in these cases since the beginning for 20 years in the cases who thought we've done everything we can. the receiver has done everything he can. this just isn't going anywhere, and it won't go anywhere until we can address this root cause of the problem, and that was the view of the judges who had been closest to the cases from the beginning and the view of the three-judge court generally, so how can we reach a result essentially without, you know, refinding the facts that they've been dealing with for 20 years? >> the problem with the fact finding, -- well, there's two. the receiver gets appointed and there's a motion for a three-judge court and they convene themselves before the receiver finalized the comprehensive plan to bring

everybody into compliance in the first instansz. the reality is that's the fundamental legal error i'm asking the court to correct, but if you get beyond that, it seems it's at best a mixed question of law, and it's the kind of standard this court should analyze to determine in the first instance in an independent review whether or not the overcrowding is quote "the primary cause of the violation." and what makes that appropriate to the court is adherent deferring to the district court in the circumstance is that that the district court cut off the record in august of 2008 and there's been enormous developments since then. >> it was confusing in the briefs, mr. phillips, i thought that the state had said we don't want the plaintiffs to tour these facilities anymore or have it go beyond from 2008.

i thought it was the state that was urging we don't need anymore discoveries. we don't want anymore expectations for it. how could the plaintiffs submit more than they did when the state said it's enough? 2008 should be the cutoff. >> well, there's a huge difference in not allowing formal tours and all that goes with that which is what the state specifically objected to, but what the state wanted to do and what the interveners on our side and others wanted to do was to bring forward evidence that proved that in the interim period of time there have been in fact significant improvements. as i sit here today, justice kennedy, you say it's conceded we're in constitutional violation. it is conceded we have been in constitutional violation.

i don't know whether -- >> if you -- you can see that you have been in constitutional violation, then it seems to me that you have the burden of showing that is no longer the case. that's generally so in -- >> counsel, did you -- >> can i answer justice ginsberg's question first in >> yeah. >> i understand what would be in violation, but an order entered under the prisoner's reform act and it's clear it shifts the burden significantly on to the plaintiff when you are going to go for a remedy as extreme as insisting that somewhere between 36,000-45,000 inmates be released in a two year period of time. go back, the receiver at the time all of this took place, the receiver had been appointed.

the receiver devised a plan. >> the receiver is spending $4 billion on health care to get the system moving in the right direction with the right attitude in order to bring ourselves without question into constitutional compliance. the truth is we have not had an assessment. >> are you talking about one of the cases, but the other one, the newer one, the 2001, but what about the one that was in 1990? >> well, it is a much more serious problem. i don't doubt that, and if the court were to conclude ultimately that coleman ought to go back for another analysis based on the problems there, i could unthat, and it would be a very different prisoner release order because then you have to take out the evidence with respect to plot and let that play out, but that seems like a mistake under these

circumstances with a special master and the receiver was in a sense joined at the hip in a variety of ways, and it only makes sense because the receiver is controlling the provision of medical care in the cdcr, and the special master is taking care of or trying to promote a very small slice of that, so in the seem of things os you might expect, the receiver gets the ultimate authority to make the decisions to help provide the kind ever resources both in quality and quantitity and staff and construction and access to health care. >> counsel, it -- it's this issue about evidence. did you proper to the judge anywhere in the record what the additional evidence it was that you wanted to show? i know that the decrease in suicides happen post trial so you counted have prop -- couldn't have properred that pretrial, but you run the prisons. i presume that you could have,

yourself without discovery, set forth a proper for the court that says we had a wait time between diagnosis and treatment that was 60 days, 90 days, 120 days in the past, and we reduced that down now to 2 weeks, or whatever the reality is. why couldn't you -- >> the district court could not have been plainer, and when the counsel stood up in the opening statement and said i want to start talking about the beneficial changes and where the status is today opposed to way back when, the three-judge court, or at least one member of the three-judge court said we have been as clear as we can be that we are not entertaining evidence on that point, so the notion of coming forward with a proper is currently a feudal act, and we made reference to it. i don't think it's an

appropriate response putting forward more -- >> you were invited to proper that evidence that went to the appropriateness of the remedy so you didn't have to proper it. it viewed you as saying we're no longer violating constitutionally violating the 8th amendment. instead it says we'll take what you have to proper to show that the remedy is inappropriate. >> justice sotomayor, to my mind, there is at least a complete disconnect saying i'm not telling you exactly where the constitutional violation is today. we're not going to get into that. we're going to assume there's a constitutional violation. now, prove to me what remedy will or not work under the circumstances. this is the exact opposite on how to do it. you determine where the violation is -- >> your time is about to expire. thank you, mr. chief justice.

>> mr. specker? >> thank you, mr. chief justice, and may it please the court. for 20 years the overcrowding crisis caused prisoners suffering from life threatening illnesses in their cells because treatment facilities have no room for them. prisoners are committing suicide twice the national average enand two-thirds of the suicides are preventable. >> is that current or past? tell us the date of the figures. >> sure, that's from the trial courts. >> that's what i thought. how do you address your adversary's point that the problem can't be measured unless you measure the state of the situation at the time the remedy

is imposed? >> well, i think, your honor, there is massive amounts of evidence about the constitutional violations that existed at the time that the remedy was imposed, and if i can point to the jurisdictional statement, one appendix of page 30a, the court said nonetheless as we described below, fundamental unconstitutional deficiency caused by overcrowding continue to exist. >> you didn't take evidence on the point, i thought? >> your honor, i'm sorry that's not correct with all due respect. they had massive amounts of evidence the day up to the trial about all the conditions relating to the remedy, and those institutions -- >> current conditions? >> current as of the time -- >> what was your friend talking about when he said that they rejected any effort to show the current situation? >> well, my friend and i have a

disagreement, but i think justice society mayor accurately captured it. what the three-judge pam said is look, we're not going -- you can't -- this isn't the place for you to come in and say everything's fine when everything is constitutional. what the three-judge court said we will consider, and they did in fact consider all the evidence from the state. they had experts from the state, two of the prisons in august of 2008, those experts wrote reports. they testified, and they testified about the conditions current, and one of them from -- >> this is in 2008? >> that was the time of the trial, your honor. >> they had a cutoff state of some two months before the trial. >> in august, and the trial -- >> and that was -- but before that point, the experts that were testified were aware of the conditions that existed. >> exactly, your honor.

>> and when was the remedy imposed? >> well, the final order -- the close of evidence was in december of 2008. >> in the one judge curat? >> no, in the three-judge court. it closed evidence in december of 2008. we then argued the case after the post trial briefing in february of 2009. then the court came out with a tentive decision about 20 days later, and then in august of 2009, it issued the 183-page opinion in the order. >> i'm sorry. let me just keep track here. the evidence was cutoff when? in 2008? >> the trial closed in december of 2008 after all the parties had submitted all their evidence. >> and there was post trial briefings for a month, then argument in feb of that year, and then a few weeks later they issued a brief summary of their

conclusions in attempt to get the state and parties to settle the thing. >> you don't dispute the statement i have in the response of the interveners that between october 2006 and october 2010, the population of the adult facilities declined by 14832 inmates? >> well, i agree with my friend, mr. phillips, that the population has declined by about 10,000 prisoners, and most of the decline is due to transfer to out-of-state prisons, and it's true that some amount is as result of good time credits of state electives to pursue on its own. >> what about the argument that there was evidence that should have been admitted but was not with reference to new construction? >> well, there was no evidence that wasn't -- that was offered that wasn't

considered by the three-judge panel, your honor. they considered all the evidence. there's 183 page opinion is scrupulous in considering all the evidence both that supported the order and distinguished the evidence and that made credibility determinations based on the evidence, but that was contrary. >> can you explain what the connection is between the 137.5% figure and the constitutional violations relating to the provision of medical care in general and treatment for mental illness? my understanding of the 137.5% figure is that that has to do with the total number of prisoners in the system in relation to design capacity, suspect that right? >> that's correct, your honor. >> now, that doesn't speak to the number of personnel who are available in the system to

atepid to medical needs or mental illness. it doesn't speak to the extent of the facilities that are available for those people. it seems to be a disconnect between the two. can you explain why that is tailored? >> yes, your honor. there was the findings that 137.5% was maximum number of prisoners of the capacity of the design capacity of the prison that the prison could house that would enable the state to have all those things you mentioned, staffing, facilities, medication management, the effectives and reach the people who are ill seriously. >> that's what i don't understand. could you not have a prison where the cremes are -- cells are crowded and 137.5% design capacity is not

unconstitutional itself, is it? >> no -- it's a remedy, your honor. >> you could have a prison where the cells themselves are crowded and yet there's other facilities available for medical care and plenty of staff to attend to those things, so what's the connection? >> and you're right, if there were -- if the cells were crowded and the prison had all other facilities available, there might not be a problem. i hope that you can understand that in this case, the prisons were built to double cell the prisoners, but they were not built to provide 200% of health care needs, so as soon as they started to double cell these prisoners, they could meet the literal housing needs not space of the cell, but not the needs of the health care, and that's why, your honor, that the 137.5% figure is reasonable because the

court went almost a third on overcrowding above what all the experts recommended. >> why the release of around 40,000 prisoners many of whom, perhaps, the great majority of them are not going to be within a class in either of the lawsuits. what are the release of all those people rather than ordering the provision of the construction of the facilities from medical care, facilities to treat mental illness, hiring of staff, why not go directly to the problem rather than address what seems to be a different issue all together? >> there's two responses to that and a little separate. the first point is important to understand this is not a release order. it's a population crowding order. the court is not ordering the state to release people. they can reduce crowding by more

transfers to out of state. to the construction point, the state can construct new facilities to increase the capacity in the three-judge panel said if you increase the capacity, you can increase the population. the point about if all -- >> if all they do is build more cells, they don't address the problem. >> exactly. that's the second part of the question. why not order the prisons to hire more doctors, medication, management, all those things, and the answer is in the coleman brief that lists 70 discreet orders which the coleman, single-judge coleman court tried over a period of 15 years which have proven to be ineffective, and that's why the court analyzed all of those things. the trial court analyzed all those things and made a finding of fact that based on the statements by the special master, but the receiver's reports and by the horrendous

conditions in the prisons, that those discreet orders would not solve the problem, and given the level of harm -- >> i still don't get it. they were order to do a variety of things that directly addressed the problem, and they didn't comply, so in order to -- >> no. >> in order to provide some kind of a remedy, we'll order something else that doesn't address the problem. >> no, that's -- >> that these aim at addressing. >> no, justice, they said this would be an effective remedy. all the testimony they heard from experts from texas, from pennsylvania, from washington state, all of whom had suffered, had dealt with crowding in their prison systems had said that when you reduce the crowding, that's the critical thing to do now because unless you reduce the crowding, nothing else is going to work, and the court find that that was exactly true. nothing else over 20 years in

one case in over 8 years in another case has worked, and as justice kennedy said, massive amounts of evidence show that the primary reason it didn't work is one singular word, overcrowding earnings when you reduce overcrowding, the prison can operate and provide those services that it can't provide now so that doctors have room to work which they don't have now. there will be less prisoners so officers can take them from one place to another to get treatments. there won't be as many lockdowns. >> it's still a very indirect way of addressing the problem, and it has collateral consequences. if i were a citizen of california, i would be concerned about the release of 40,000 prisoners, and i don't care what you term it, whatever the terminology you use was, but if 40,000 prisoners are going to be

released, you really believe if you were to come back here two years after that, you would be able to say they haven't, they haven't contributed to an increase in crime in your state of california? in the meekest brief submitted by a number of states, there is an extended discussion on the affect of one prisoner release order which i'm familiar which was in fissle, and after a -- philadelphia, and after a period of time, they tallied up what the cost of that was, the number of murders, rapes, armed robberies, number of assaults, that's not going to happen in california? >> your honor, this trial court found based on 50 pages of opinion, expert testimony, not only from our experts but from the state's experts, from the interveners experts all came to the unanimous conclusion that there are methods by which you can reduce crowding which will

not increase crime. the secretary of the department of corrections who was the secretary of the time of trial testified that he was in favor, for example, of increasing prison's good time credits to reduce crowding, and manufactureover there was statistical evidence saying and looking at all the other states that had reduced their prison population over a period of 15 years all came to the same conclusion which is there's no -- there is no increase in the crime rate -- >> but that is not what the three-judge predistrict court determined. the litigation reform act requires that court to give adverse weight on public safety, and then it said to the state, look, you get a plan that gets you to 137.5 in two years. the state did, and the state did not say, in fact, it did not say

this will have an adverse impact on public safety. >> right, but -- >> that's a double negative there, but what the district court said we're sure the state won't do anything with an adverse impact on public safety on page 4a of the jurisdictional statement, and so it did not make those determinations, but the pli rate requires it to determine what it's ordering or at least gives substantial weight to the public sift issue, so isn't that a base sis -- basis for overturning the remedy that's imposed here? >> i respectfully disagree with that. >> i thought you would. [laughter] >> at least it's respectful. [laughter] i'll tell you why i think that. the court examined all of the methods that are commonly used, and that the governor himself

has proposed to reduce crowding. the governor himself wanted to reduce the prison population by 37,000 in one of his legislative enactments and it was testified those proposals were safe. >> in a two year period? >> yes, your honor, he submitted legislation to the legislature for that, and the legislature wouldn't take it, and the governor actually said reacting to that after a riot which was one of the chino, a prison in california, a riot, and the politicians in sacramento swept want problem under a rug. >> my question is with respect to the two year plan. i want an answer to that. i don't see the district court did what was required by the act with respect to what it is ordering. it said i'm sure the state would

not do anything to harm public safety, after saying we need a plan in two years that gets to 137.5. >> right. it didn't analyze the plan because -- or there was no plan. the court, what the court did was it said we want to give the state the maximum flexibility for reasons to determine how best to remedy the constitutional violations. now, i'm certain, and they said -- they also said they were sure the state can do it in a safe way, but it's -- >> i said we're sure because we trust. i'm just quoting from 4a, we trust the state complies with duty to ensure public safety implementing the constitutional required reduction. the state is saying it cannot meet the 137.5 in two years without an adverse impact to public safety. >> right. that's a safe position in the state's position all along, the

court's findings that a population reduction of this magnitude were clear, and they are not shown to be clearly erroneous here. the court said point-blank that we -- it's our finding that the state can reduce the population to its current levels, from its current levels to 17.5 safely. >> counsel -- >> it wasn't shown erroneous. they didn't have to look at particulars in an effort to give the state the maximum flexibility, they wanted the states to choose the method they wanted. >> what do you mean they can do it? of course they can if they build more prisons. >> you know, that's high in the sky. >> they can do it safely by good-time credits -- >> doesn't credits let people out who are not otherwise be out? >> just a -- you know the evidence was at

trial, and the court's finding about that evidence was, and the state officials so testified that giving prisoners good-time credits is not a threat to public safety. >> with respect, why wouldn't it be a belter course -- better course for the court to say the state can do this in five years without any public safety problem? why don't we let them take those five years? >> because, your honor, as justice ginsburg and others have said, the constitutional violations have been ongoing for years. there's cases of life and death and serious injury, and after all of these years, when they heard the evidence that said that population could be reduced and they made the findings which the state doesn't argue or clearly are erroneous, and they made those findings it could be

reduced safely, they had an obligation to provide a remedy that would provide constitutional adequate care in the safest manner possible and quickest manner possible. >> i think sotomayor has been patient up here. >> [inaudible] i'm not responding to the chief justice, but didn't the district court discuss different safeways -- >> yes. >> of reducing the population that says we're not imposing them because we want the state to choose among them. >> yes, your honor. >> as i look add the state's final plan, i thought they had, in fact, not only accepted all of the recommendations, but they added a couple of additional remedies that the court had not suggested. >> yes, your honor. >> is it a fair statement that the three-judge panel was saying if you do these things, that's their finding? you can do it without affecting

public safety? wasn't that what they were saying. >> yes, your honor, if i didn't make that clear, i meant to. >> the more important question is going back to something that justice scree ya asked you what was you made the statement that no one was stopped from prospering evidence about prison conditions up until two months before the trial, so what evidence was excluded? at what point does the other side make that they were excluded from making? >> well as we said in the brief, your honor, there was no evidence excluded, and inxí

>> this can be done safe proceeding whatever page it was, 253. >> right. >> there are about six pages where they summarize evidence from all kinds of criminalnologists that say an ex there's 17,000 violaters sent to prison who have not committed additional crimes, and they could be released from some of the time they spend in prison, and they go on to good time that lead to people who are 50 or 60 years old who have been in prison for 40 years would be released at age 55 instead of age 75. i guess there's a category there, and there's several other things. okay. now, what is in fact --

>> and there was also testimony that the department of corrections was using a risk assessment instrument to identify the low-risk prisoners. >> isn't it true that one of the main programs that was cited as providing a safe part is evidence-based rehabilitation programs? >> yes, your honor. all of the witnesses from the state, the interveners, local witnesses, our experts all found that those would help reduce crime, and they would be most effective -- affective if they were also in the -- >> what's the general record of the success of reha bill nation efforts? >> you can't say generally because different programs have different -- >> what did congress think when they enacted the sentencing reform act in >> i don't know, your honor. >> i have this question as it's to a remedy recognizing the

district court has to give considerable discretion. it chose the 137.5 figure because it's halfway between 145 and 130. >> yes, your honor. >> i think the prison litigation reform act means if they're going to be release orders, they have to release the minimum amount -- >> yes, your honor. >> that will affect the purposes of the remedy order. there was substantial expert opinion that 145% would be sufficient. isn't -- doesn't the evidence indicate to you at least 145 ought to be the beginning point and not 137.5? >> well -- >> i understand -- correct me if i'm wrong, more experts testified at 145 would work than 130 was necessary. >> no, i, i respectfully

disagree with the record, your honor. the 145 figure is from a report by the former governor in a group he organized, and they said they could operate crowded system at 145% of the capacity, and that figure was high with what the district court found because it didn't take into account health care needs which is the issue here, and our experts testified that because it didn't take into account health care needs, 130% was the better number. it's the number that the strike team had thought of, that the administration's own strike team and the number of that these professional experts believe would be sufficient to remedy the population, and back to my answer is the health care facilities themselves were built to provide services to only 100% of the health care services to

only 100% of the prisoners. >> the experts that were testifying were quite aware of the fact that overcrowding related to the constitutional violations, that was their whole theory. >> yes. >> and a number of them suggested 145. >> i think there was one expert suggesting 145. i think most of the majority of the experts suggested 130. ..

she didn't answer. maybe the answer, counsel, please. >> thank you. my recollection of the testimony was that our experts said it had to get down to 130 in order for the other remedies to be effective, your honor. >> the experts engage the 145. the extra duty of the 145 -- >> there was one expert who said maybe in the best of circumstances if you could get to 145. while the others talked about 130%. >> let's go to the one used the 145. >> who is a psychologist, your honor. >> u.s.a. was? innocuous psychologist with expertise in prison health care. >> to d.c. at 145 you could

deliver health care safely click >> use of a book on that. he's been on the outer reaches that may be true. i want to emphasize that the district court has allowed the state to come out in any kind to modify its order in two minus five percentage points if the circumstances change. >> there's at least two significant changes. one is the senator from california who dispatched the love of a good time credit and also addressing their probationers and the parolee with the technical violation. do you have any information about what effect that legislation is passed in january? >> it was past it think last year. i think it went into effect in july of last year, i believe, if that's what you're referring to.

>> do we know at all what effect this has? >> it is not a marginal effect of reducing the population. they are is no increase in crime. but to get back to my earlier point in your point, justice kennedy, the remedy that these should be the least interest as possible. this order is set to take effect over a two-year period. and during that two-year period, if mr. phillips is correct that the conditions are constitutional and that they can deliver services at the 145%, then the state is free to come in and make a motion to bring those changed circumstances to the court. and if anything, this court has been incredibly sensitive to the needs and desires of the date. and it was extremely reluctant in this order in the first place and would bend over backwards to give the state discretion.

>> i don't see a funny by the three-judge court that 145 would not be an efficacious remedy. i know it is for 137. >> yes, your honor. i don't think it explicitly said 145, but i think he discussed the 145 figure in the context of the fact that it didn't provide for health care services. so it discounted that a little bit, went down about 7%. >> can ask you a hypothetical question at no is not your case? there was a order saying you have to bring it down to 137.5 in two years. that was a practical matter result in the release in prisoners. the state comes back and makes a showing sane if he gives for

years without releasing any prisoners. >> for the district court to say no i want this done in two years, not for years. and we just have to do with the fact they're going to be 40,000 prisoners out on the streets. >> welcome the prison litigation reform act requires the court to give substantial weight to the public safety implications of its decision. so, under those circumstances, it is possible -- on this hypothetical circumstances, there's always the possibility those cases, the degree of public safety could be problems might outweigh the harm. as he said that's not this case. they found that we could do it. and the panel found that the state could reduce the population safely. and there is no suggestion in the record that this two or four

year period would make that much difference. but the 40,000 or 35,000 figure in context. california releases 120,000 prisoners every year on parole. that's a lot of prisoners. in the finance of the district court are even when the california increases the number of parolees in the community, that doesn't increase the crime rate. >> what is the recidivism rate for those parolees caught >> it depends on the risk of the parolee speared >> in general, what is the risk? >> overall the risk is around 70%. a low-risk prisoners, the risk is 17%. >> i'm sorry, what was the first number when you tickle parolees altogether if 70%? >> seventy. within three years. as the situation we have now and that is the situation with the governor, the secretary

described as a failure. with parole reform you could reduce that in the court to describe how ug that. >> for lower prisoners at 17%. california health risk assessment instruments, which the court found could be used to make sure that what happened in philadelphia doesn't happen again. >> if only the low-risk people are released around 3000 of them are going to commit another crime. >> they are not to be released. first of all, i want to make sure emphasize this is a crowning reduction measure. you don't have to release 35,000. >> it on up to be released if you can build enough cell. >> you can divert -- you can improve the parole system so that parole violators don't commit so many cramps if you offer rehabilitation alternatives, if you provide a number of divergent

opportunities. the 70% figure goes to exactly make for. this is going to have. it seems likely this is going to have an effect on public safety on the experts can testify whatever they want. you know where? if the order goes into effect, we will see. people of california will see. are there more crimes or they're not? >> bilson crams another jurisdiction, i want to clarify one point, your honor. the 70% figure doesn't always include cost. and it includes love to parole violators. so it's not as grave as some of the figures. >> is there any other case where it has been done or is this the first one?

>> this is the first one to reach this court obviously. there's a few others that have been resolved by intent as i see it or not appealed. >> is there any evidence -- i see their suggestions that the technical parole violators go elsewhere, that the elderly and infirm prisoners, some of them be released? a good time credits for older people would be increased? and also, halfway houses and other kinds of prison facilities, which used to be called less physically restrictive punishment, or taking the money you saved in building new prisons. okay, that seems to be the gamut. is there any other evidence to declare otherwise because the disputed state did reliant halfway houses that they relied upon the certain camps -- prison camps and some of them were pretty tough.

is there any statistical evidence on the point that justice alito raised whether he did or did not result in higher crime rate? >> the evidence is in the court found and again it's not clear error that these programs were not -- were more effective than prison in reducing recidivism and they were less expensive. mm is part of the reason why the three-judge panel concluded they reduction in prison population would increase costs. >> council, what are the things that the state is responsible for a lot of different things. what happens when you have this case, another district court ordered the state to take action with respect to environmental damage? another coarse-grained effect to spend this much more in education for?

another court and got to spend this much more than the mouse clicks how does the state sort out its obligations? >> we spend more money to build prisons, but i'll violate this other court orders and i have to spend more money to build water treatment plants. >> well, your honor, in this particular case -- >> i know you would like your particular case of indiscriminate put my money. is a budget prioritization of state has to go through everyday not been transferred from the state legislature to federal district court throughout the state. >> i believe the federal courts have an obligation to enforce the constitution and laws. >> i believe that as well, counsel. what i am saying is you have conflicting orders from different district court, telling them you've got to comply with the constitution is spending a billion here and another coursing up at another constitutional problem of my own you've my own you've got to spend a billion of it there. what is the state supposed to do

in that situation? >> well, my simple answer to your question, your honor, i don't need to be flippant, but they have an obligation to follow the federal law, constitutional law and other laws. if they're not, the federal court has too informed a remedy. in this particular case can the state as a choice. we can either incarcerate 140,000 prisoners in the system built for 80,000 or it can incarcerate a lesser number. if it chooses to incarcerate 140,000 prisoners, it's going to incur their obligation. they said in answer to justice breyer's question, they could use to choose lesser strictest punishment, alternative punishments to get a better bang for their buck to have more public safety. if the court impose that kind of a rule, then the state would here saying that it's violating, and it provisions in making policy choices for the state,

which i believe in this case the court gave the state the maximum degree of flexibility to make all policy choices surrounding the incarceration of these prisoners. the constitution prevents the state from incarcerating somebody and then not providing them the basic medical care they need to escape from the prison and not die before the sentences out. and that's what we have here. >> if you take the state's confession that it can meet a goal in five years in a federal court orders two years, we're talking about three years, is there any indication of how fast the state's remedy you would click and? are we talking may be about a 5% referential? >> there's a lot of things if they can do quickly. for instance, you can not incarcerate technical parole

violators. >> no, i'm saying to compare that the state concedes what it will do with what the court has ordered her to do. >> i just want to remind you that the governor proposed the legislature as she reduced the population. it can be done safely in two years. what the court found was with the governor believed was safe. the five-year period is longer. and the five-year period is longer because it takes time to construct the facility the state wants to construct is the difference between the two remedies. but the other method, the good time credits, pro-reform, diversion, those can be implemented very quickly. and the substantial reductions can be accomplished if do not amount of time. >> so should the court said two

years for everything but construction? wouldn't that have been a more narrowly tailored remedy? except that they -- there was going to be no construction adequately because there was no money. >> rates, and the state has not really put up the money to construct those new prisons. this case has been ongoing since 2006 what are the constructed anything. even if i was a more narrow remedy, it would not be a viable alternative. my time is up. >> thank you i counsel. mr. phillips, you have three minutes left. >> thank you, mr. chief justice. just a few points. first of all, but the state of the record and what was profit or what was nonprofit, if you look at the joint appendix that 2085, there is a specific offer that is made by the intervener; text -- i'm sorry, a specific property made by the state --

>> i'm sorry, what page? >> 2085, that is volume six. at that point where the intervening plaintiffs put on the constitutional violations. judge carlton says twice as korda says we will not receive that evidence. you've made it clear -- is clear record as you can. please don't waste our time. later at 238, given volume six, were we enter mr. sommer, was the assistant secretary to charge health care company specifically says i've read the december declaration and it will not be received to the extent it says citizen complaints. so we've made our efforts. >> out about the declaration said. as the actual declaration of the record somewhere quiet and not the actual declaration is in the record. >> on a different subject, does the states and by his representation that it can do this without any public safety in five years?

>> yes, we made a submission to the court and we believed that we could comply. notwithstanding budget economic differences, budget differences. >> plans council talks about all the things you can do. if you look at 78 jurisdictional statement specifically says above the line we can implement and that will teach you about 16,000 inmates in below the line beneath legislation to implement these things. but the reality is that anytime you say you're going to release 30,000 inmates in a very compressed period of time, i guarantee there's going to be more crying and people will tie in the streets of california. there's no way out of that particular box. >> if they were fighters come you could elaborate on a public safety in the way you told the court you could. >> i'm so concerned because the district court says we have not evaluated the safety impact of each of the states or elements

of the state's proposed plan. it seems to me they had an obligation to do that. the other point i want to make with respect to justice kennedy's question as there is not a shred of evidence that the 137 and half makes whatsoever. there is with aspirational. none of that is based on what is the constitutional violation that exists at the time you would do that percentage. it seems to me that the entire problem of this exercise, which is to say we're going to fix this, which is to evaluate the manner sicily by facility to evaluate these matters on the basis of the discrete elements of how you can reduce the prison population and to do it in conjunction with the receiver was in place, who can help to implement this in a very systematic way and get us where we want to get to. >> why didn't you give the court that is your plan?

the court g the court give y the court give you absolute discretion to implement the plan that she wanted. he said we don't want to do facility by facility because we want you to figure out where you need to implement. so, your plan didn't do that. either in your five-year plan for you and your two year plan. >> the district court orders that you're going to have to reach 137.5% in two years. that is a categorical rule. the first time i went above the 137.5, justice andersen are not doing that. >> thank you, counsel. mr. phillips, mr. speck orcome in the case is submitted. >> attorney general eric holder today until the operation broken trust, a collection of unrelated criminal and civil cool and transpacific cases in financial fraud. defendants facing charges. representing more than a $.3 billion in investor losses.

here's a portion of the news conference from today at the justice department. >> good morning. i'm pleased to be joined today by several key leaders in our collect of effort to combat financial fraud. fbi executive assistant director shawn henry, sec director of enforcement rob saw me as well as the united states postal inspection services, chief postal inspector guy could tell. ira's criminal investigation deputy chief, rick raven and commodities future trading active director of enforcement and said mcconnell. we are here today to announce the results of operation broken

trust, a three and a half month investigation targeting of investment fraud to her country and a crucial step forward in line for his network to protect the american investors to ensure the strength of our markets and to prevent financial fraud schemes. now while there is not a new about conducting nationwide operations and sweeps, this one is different in that it brought together a broad array of criminal and civil enforcement tools for both the federal and state level to attack investment fraud schemes collectively. operation broken trust is the first national operation in history to target the many different types of investment fraud schemes that pray directly on the investigating public. this historic effort has been coordinated, executed and led by members of the financial fraud enforcement task force that president obama created in november 2009.

this task force is the broadest coalition of law enforcement, investigatory and regulatory agencies that were established to combat fraud. multiple federal agencies as well as department of the state and local levels are working together to ensure that no stone is when it comes to protecting consumers and investors. now our mission is simple, to bring financial fraud schemes to light and those who operate them to justice. and our chris of coordinated is working. since operation broken trust was launched on august the 16th, all across the country, investment fraud cases have been prioritized. to date, the operation has involved enforcement actions against 343 criminal defendants and 189 civil defendants whose conduct harmed more than 120,008 is. several individuals have been charged with defrauding men and women across the country out of

thousands sometimes millions of dollars. the cases in this operation involves a variety of different investment fraud schemes that have led to more than 8.3 billion values in just the canonical cases alone. these are staggering, staggering numbers. these losses represent hard-earned money in your life savings in some cases. and if it may not demand and dreams that may not be fulfilled. all of these victims can tell a tragic and a cautionary story being exploited often by someone who they trust. many of the scam artists we identify were praying on their own neighbors and on the most former members of their communities. several of those prosecuted during this operation solicited victims and actors from around churches. one man in texas allegedly targeted his fellow parishioners, asking them to invest within and claiming that

the success in foreign exchange trading was closed a blessing from god. in florida, one defendant was convicted recently for his role in investment scam that specifically targeted the local haitian community in ohio, a former police officer operating a ponzi scheme from active and retired police officers and firefighters. and in chicago, and other ponzi scheme resulted in $30 million in losses to hundreds of it comes, many of them elderly immigrants. as a result of our prosecutions, the man who operated the scheme has been sentenced to more than 20 years in prison. many criminals related ideas investor funds to support lavish lifestyles. one man operating in at 880 million-dollar ponzi scheme in florida duped investors from across the country and use the money to buy foresees a professional vesco games and

make payments on his personal god, his beach house in his mercedes. a new jersey man charged with operating investment scam allegedly used investor funds to make payments on three different luxury cars and to pay at least to country clubs. now what this operation, the task orders is sending two messages. you have to be alert to these drugs. take appropriate measures to protect yourselves and repurpose such schemes to proper authorities when they do occur. the second message to anyone to send team to operate an and invest in. we will use every tool at our disposal to find you, to stop you and to bring you to justice. cheating investors out of their earnings and savings is no longer a safe business plan. among with the agencies represented here on stage, i also want to thank the federal trade commission, united states secret service and the national association of attorneys general because of their work and the

contributions of everyone involved in operation broken trust, dozens of criminals had fraud screens not a significant time behind bars. between one defendant at 85 years. although this operation marks an important step forward for the fight to combat financial fraud goes on. the task force will continue working with consumer groups to increase financial literacy and to raise awareness about the warning signs of financial scams. we encourage investors to share tips and concerns with us a visiting stop fraud.gov. but the commitment of so many partners and help with informed public, i'm confident we can take on fight against financial fraud to a new level. i'd like to turn things over to fbi executive assistant director, sean handley. >> thank you you like to thank the attorney general for his leadership in this operation and thanks to all my partners who are standing here with me on the

stage. operation broken trust is the largest nationwide investment scheme we've ever conduct it in terms of an investigation. the focus of the soup soup is recommended against individual investors, including ponzi schemes, high-yield investment gods and market manipulation cases. operation broken trust highlighted pervasiveness of the threads and its impact on individuals from all walks of life. the perpetrators of these kinds are those who you might trust, hence the term operation broken trust. friends, colleagues, people you worship with, people you work place, people from your kids soccer team. criminals have always preyed on the trust individuals with offers to good to be true. other schemes might change, the underlying greed does not. one victim of a large ponzi scheme in tennessee said we were such very good friends. we went to his house often. he was a brilliant man. that's how he was able to con people for eight years.

financial fraud is not a victimless crime. criminals live lavish lifestyles as attorney general described in the senate lifesaver for me when i'm with uncertain financial futures. victims who might have to postpone retirement and fine second jobs, victims who may lose their homes, victims who are left wondering, what to i do now? to illustrate the scope of the problem, consider this. in the swimsuit alone, we have investigations and 48 of the 56 field offices nationwide. more than 120,000 victims, with an $8.3 billion in fraud, and losses. the mission of operation broken trust was twofold. to stop and bring to justice those that are responsible. focusing on 231 high-priority security fraud cases ranging from ponzi schemes in foreign exchange fraud to the classic pomp and dump schemes. the second goal was to raise awareness of the general public. the american people need to understand the threat that they

face in their responsibility to remain vigilant. the american public as part of this. more americans are in the american security markets. we've seen more fraud and misconduct in these markets and the creation of complex investment vehicles coupled with an increase in the amount of money and developing technology has generated greater opportunities for fraud. at operation broken trust is merely a snapshot. there are many ongoing frauds and we will not let up the fight. in the past three years of increasing number of agents assigned to security fraud cases by 47%. since january 2009 come with open when the 200 ponzi scheme cases alone, many with losses in excess of $20 million. while we've had great success in shutting down the schemes and putting those responsible behind bars, there's always more work to be done. we must continue to focus on intelligence and information sharing, not only to prosecute financial fraud, but to predict

and prevent these types of investigations, these types of fraud. fbi agents and analysts are trained to identify emerging schemes in price and will continue to use sophisticated investigative take me including undercover operations to successfully prosecute our adversaries and to finally stop criminals before they're able to prey upon others. the most important weapon in our arsenal to combat this threat is collaboration. we need the help of our many partners, including law enforcement and the private sector. it's no coincidence to represent us so many different agencies seem inherent stage and others to