i think if all of you are confused by some of the things you read in the paper every day, this is a little filter for you saying is this a manifestation of the positive or negative forces of our interdependence? that is, we can't get away from each other. what happens here taxpayer and vice versa. every citizen's duty is to try to build up the positive and reduce the negative forces. and when you're all said and done, the best you can ever hope for is have a positive record because everybody makes mistakes. i think when you read tony blair's book you will conclude that these had quite a good run and is still very high on the positive side. thank you. do not doubtless terrific. [applause] ..

now from the american university public affairs and advocacy institute, a look at lobbying on climate change policy. former deputy energy secretary elizabeth miller talks about how the november e elections will refrain the politics of environmental issues. her lecture is an hour and 15 minutes. >> this is the public affairs

institute american university. it is an institute that goes for two weeks every day all day. our students are interested in the efficacy lobbying business and so we are hearing from professionals in the business about 30 presentations in two weeks. the presentation today is related to the case study and that is climate policy. betsy is the perfect person to give this presentation. the presentation title is the present state of political debate over policy. she is the executive vice president and head of government affairs and public policy and council or was to the excellento corporation recently retired. you have an advisory positiony n with the corporation right now. fo's an energy corporation.foly formerly unit,, and it produces -- it is one of the largest

energy companies in america and it produces electricity from a variety of plants, coal-fired plants and of many nuclear powel plants, the interested in that n space. also interested in transmission issues and betsy came to the joo and comes with us with anve extensive experience in energy vironnvironment policy. she was the senior counsel for the committee on energy and natural resources from 1976 to 7 1988 and worked with scoop woedi jackson from the state of washington and also john whoha were tears of that committee. she also supplanted by reagan te serve on a member of the rich to the drew commission. she was appointed by george h.ye w. bush and bill clinton andhaif became chair of berc and was o

deputy secretary of energy in the departmenten of energy workd for worked for a law firm here is that specializes in energy, and also has been given a variety of awards for her service. one that i will mention, i won't mention all of them who is a national energy distinguished service award, and she's been named by the hill, the publication, top corporate lobbyist in washington annually since 2003. but most importantly she is a graduate of american university. welcome, betsy. come on up. [applause] >> thank you. thank you, jim, for that kind introduction. i appreciate the invitation to speak. this is early in the morning, i understand that you guys need to go out and get coffee, i won't be offended.

i don't think the tv guys well might he do. it's a pleasure to be here. i did recently retired but i graduate from au before most of you were born. but i haven't fossilized quite yet. and i have known of jim for many, many years, more than, actually probably end you were before your borchardt i shouldn't say that but tit for tat on these things. my comments today will focus on epa climate initiative, but they will, just because of the way up and what i've done and so forth, be from the perspective of that utility executive. that's what i've done for the last almost 11 years. and the electric utility sector is one of the most impacted by what congress and/or epa are up

to. and in order to understand the electricity and utilities perspective of just going to give you a little bit of electricity 101. it's not something that you grew up knowing about. many of you may pay bills to petco or pico. anybody from philly? peco energy come is a savior of the company i used to work for. , and in chicago. it's a complicated industry so i will do the electricity 101. then i will briefly cover the congressional debate over climate legislation, try and make it not too boring. then finally i will try to talk about what epa is up to. and what it means from the industry's perspective and some of the politics that relate to that. first, electricity 101. by the way, i understand karen has distributed what i toiled over yesterday. i did do my homework though i guess i could say i've been doing my homework for about 30 years on this subject. anyway, it's a very important

part of our economy. there are many, many actors and is just an organizational mess. it's a roughly 350 billion-dollar industry, employs 400,000 people. you have heard of the shovel-ready jobs. these are ready jobs. and its roughly 3% of our gross domestic product. its capital needs are huge. they are just crazy. if you sit in the boardroom of an electric utility you talk a lot about money. there's roughly $350 billion on the books these days that's known as being an ratebase. that's what your rates are based on for the service that you get. but a recent study by an outfit called the brown group estimated that the industry will need over $500 billion to build new power plants in the next 20 years. and that's without any changes in carbon policy.

roughly $300 million, or $8 billion, for transmission. that's to get the power from the power plant to philly. and another nearly $600 billion of distribution, so you generate the power. it comes out of the power plant at a very, very high rate, if you will. big fat wires on the transmission wires, and then it is quote steps down. you have to get this so it's a lower source of power to be distributed around the city. so your generation, transmission and distribution. those are three distinct parts of the utility business. there are four principal types of actors in the industry. there are 210 investor utilities. that means stockholders on them. they're typically traded on the new york stock exchange, utilities are exchange traded

entities. there are also, they range in size from exelon corporation which is slightly less than $30 billion in market cap. it's one of the big east, essentially the second largest in the country. and him to a small iou, investment owned utility like a white electric i've always want to be the ceo of hawaii elected but i think it would be a nice job. but they never offered it to me. they're also about 2000 municipally owned utilities. the city of richmond, virginia, for example, just a little south, 100 miles south of here as the government of richmond owns the utility. and it snowed as the municipal utility. many in our jargon. they're mostly small to medium-sized players. and then that are about 880, 890, they come and go, they merged so the number change from

time to time. cooperatively owned utilities. these are typically rural utilities. they're regulated by the department of agriculture. strange but true, because they are all part of, willing to get electricity out to the boonies historically. there are a bunch of miscellaneous players. the federal government owns a couple utilities like bonneville power if anyone is to washington state our pacific northwest. they also transmission companies come and then there are a whole lot of independent companies that are power producers these days, and there are almost as many independent power producers as, that on power plants in the capacities amount of electricity those power plants produce is roughly equivalent to what all the ious own. so they are very important part of the sector. that's not always been true, that movement began in about 1978 when congress passed a thing called a public utility

republican, that's not part of this discussion. i digress. utilities use a wide variety of fuel to generate power. you use wood chips. you use biomass these days. you use water, hydroelectric. but the principle sources of fuel for the electric sector our goal, which is like 45% of the power in the country. natural gas which is a less than 25%. these precise numbers are in and out. 20% roughly that is nuclear. uranium, if you will, 6.8% hydro and then the other miscellaneo miscellaneous, solar, biomass, wind, hopefully one of these days ocean waves. i think that's very cool, the idea you can produce electricity from the ocean. that's sort of miscellaneous

renewables is a really small chunk, but it's growing. but it's not the same across the country, and the reason that matters from you guys, for you guys is that if you are a cold heavy part of the country, if your utility and use coal a lot, like the southern company in atlanta, georgia, and they serve a lot of the southeast, or aep in the middle of the country, columbus, ohio, you are going to be really, really worried about what epa is going to do to regulate coal. on the other hand, if you are from new england, which is mostly natural gas which is much less carbon intensive like a third less carbon intensive than coal, or nuclear, or if you're from the pacific northwest or california, which has a lot of hydro, epa regulating carbon,

i.e., coal and natural gas, is going to make your assets if you are in seattle electric power company, or tacoma, this is going to make those assets more valuable. so, you know, the key in all this discussion really come and is always true in politics is you need to follow the money. i have some numbers in the presentation that are boring, yes, but they really do impact politics. because if you're a cool guy he will worry about epa. if you're a nuclear utility and an excellent is about 96% nuclear, there are more nuclear power plants that excellent owns and they don't emit any carbon emissions, then you see regulated coal as a good thing. so that means your power plants are going to be worth more and you can have better opportunity in the market. so think of the southeast and a lot of the midwest that's heavy coal. think of new england.

specific northwest dashing pacific northwest, gas, electric, natural gas, nuclear to some extent and hydro. i think of texas and oklahoma and that part of the country as natural gas. and you have the picture of the politics. now i think as you get more and more into this issue you will begin to see those sources in the way the people react to the politics of climate change played out because of where they sit and how much it'll cost them is epa or congress is successful in regulating climate. that electric sector is also a major source of pollution. i once went to a lecture at the brookings institution down on massachusetts avenue where they introduced the ceo of aep.

that power company behemoth in the middle of ohio, and the person introducing said this guy is the world's largest polluter. and, you know, i thought, i don't think i would like to be introduced that would. that's not exactly kind, but he took with agreement of site and said we are big. we are getting cleaner. unit, that's just where you live is how you see things. the industry is a major source of pollution, and i use that word i think appropriately. the best source of members on this, an annual report that is put out by michael j. bradley, called benchmarking. it came out most really i think in june, and they have the emissions by each utility in the country. and emissions are declining? , and they are declining very slowly in the carbon world.

but the sector does count for 66% of esoteric emissions, 19% and 70% of mercury's which is carcinogens, not good for people over your health. and 39%, roughly 49% of co2 emissions in the country. more than any other sector in a country. that's what the reasons the fact that it's just a sitting duck for carbon regulation and the sources are easily identifiable. it's why epa is focused and the congress is focused on the industry. and now surprise lake the so-called dirty utilities are less likely to support carbon regulation because it will cost them a ton of money. and the clean utilities, the ones that don't have carbon emissions, pseg in new jersey,

constellation in baltimore, exelon, just to be called florida power, now it's nextera energy in florida. pg and e. in california, these don't have as many carbons, emissions and so they're much more likely to be in favor of regulating carbon. actually they have a little group, the trade organization called the clean energy group, and there's a lot of good data on their website. i'm not going to get into this but the industry is regulated heavily, regulated by the feds, for, epa, sec, by the states, the local utility commission, each state has a local utility commission that regulates the local distribution of power, the dams are regulated by ferc on a regular by the department of agriculture.

regulation varies by state by state and so as i said it's really a mess, are a wonderful thing if you're a scholar of this sort of thing and interest from a regulatory perspective. so now you are expert in the electricity sector. big deal, expensive, polluting. where you sit inside look at carbon legislation on what epa is up to your let me talk about politics. i'm sure most of you are graduate students, i'm told, and you've been through all these classes at this wonderful institution. and i'm sure you at some point heard that two years is a lifetime in politics. that's a congressional term. that's the long range planning horizon of a typical congressman. then it's all the way up to six years, and, of course, for years the president. so let's just think more than two years ago, and the evolution of climate change legislation, the prospects are regulation of the prospects therefore our religious proof positive that

two years is a lifetime in politics. rollback two-and-a-half years ago, barack obama and and john mccain were running for president. they both actively supported enactment of comprehensive economy wide cap-and-trade legislation. the nation was on its way to electing a very popular african-american from illinois your my company is from illinois so we considered him our senator. and his popularity was very, very high by any of the traditional means of measuring these things. there was hope and excitement about passing landmark legislation. the democrats had just elected a filibuster proof 60 majority in the united states senate. in november of 2008, congressman henry waxman of california, remember that clean state out there? had toppled john dingell from

michigan, a dirty state, as chairman of house energy and commerce committee. and he did so, in one of the reasons they change their leadership, it was not just because dingle had been there forever and no longer was popular with the young turks, but it was his attitude about regulating carbon particularly from the auto industry and that was not popular with the majority of the house. the 111th congress seemed poised to pass legislation to address climate. as a matter of fact, the first hearing that waxman had as chairman of the committee come and been chairman of the committee is like being a god in the house. it has most far-reaching jurisdiction of the house committee with the exception of the provisions committee, and they can medal in anything. so it's a big deal, very first year he had as chairman was on carbon legislation. he invited all the ceos of the

members of u.s. cap, united states partnership which was a group that had been formed a couple years earlier. he invited all the ceos to come and testify on carbon legislation. they had one of these really long tables for the ceos to sit, and they all stood up and raise their hands. they had on author expensively tailored suits, i can assure you. there were no women i might add. as the ceos. and they came and dutifully said they are in favor of mandatory economy wide cap-and-trade legislation, provided that it had ways to protect consumers from crazy economic impact of doing this. and the recession hadn't quite hit as badly as it was beginning to be awful, but they were very mindful of what the politics were from an economic point of

view. by the way, one of the ceos had to leave. the second group had a bunch of women by the way, i just want to assure you there are women in the industry, although i'd think there only to women ceos unfortunately. anyway, the waxman-markey who were viewed with distrust, shall i say, by the electric sector weren't very, very good about listening to the sectors concerned. they work and they very aggressively with congressman rick boucher from southern, southeastern, southwestern heart of virginia to craft a bill that the industry could support. it passed out of committee. it became sort of a super bowl of politics as it went to the floor. waxman and markey stepped up and make lots and lots of political deals.

i know you're shocked that that might happen during a major piece of legislation, but it certainly didn't. the administration was very aggressive in its support of the bill. valerie jarrett who is one of the two senior advisers to the president said in a meeting i attended with her that the president had made more calls on the cap-and-trade legislation than he had anything previously in the congress at the time. i suspect that record, it might've been eclipsed recently by the health care debate or anything that they did in lame duck. but it was a big deal here my then boss from exelon called in on defense democrat from illinois, whose name is bill foster, and foster said look, john, the president has called me. the vice president has called me. rahm emanuel the rahm emanuel the chief of staff called me. al gore has called me. carol browner has called me.

unit, the white house climate garden. lisa jackson ahead of epa has called me. so what you can you tell me? so i tell the story only because it was a very big deal. by the way he was not persuaded that he voted no. he should have known better. he actually eventually was defeated, but not because of that particular vote. but they did pass a major climate bill in the house. it passed by 219-212. are only eight republicans who voted yes while 44 voted no. one other republicans who voted yes was a congressman taken from illinois, congressman kirk. he said i voted yes, but now i would vote no. it was one of those and that was when he was running for the senate. he is now a senator. the lobbying effort was huge. the edison electric institute did support it because it had enough of those consumer protection provisions in it, and enough of provisions to

guarantee that the price, and i can go into obnoxious detail about this if you are desperate, but they had a lot of consumer protection provisions in there. and edi did support it. so did the u.s. cap. most unions supported the bill while the u.s. chamber of commerce u.s. chamber of commerce, the national association of manufacturers, the american petroleum institute and a whole bunch of conservative organizations, and this is setting up were you guys are going with this class, i get that, opposed it. and interestingly there was a newly formed evangelical group in favor, you usually think of the evangelical group has a very conservative group, particularly on social policy but they have a newly energized group. i met with in a number of times and this was sort of unfolding that has convinced that society is hurting the earth, and it's their duty as evangelicals to do what they can to overcome that.

said they were actively engaged in the subject. and the administration was very actively involved. the bill was a kitchen sink kind of bill. it had carbon legislation in it. it had a requirement, utility procurer 20% of the energy they use by 2020 from renewables. but it did have a comprehensive cap-and-trade provision that by 2050 would reduce the nation's overall carbon footprint, require a deficit of 80%. as an aggressive goal, but i think should have been manageable. then the politics began to get ugly. they pass it. i remember the first time i heard about tea party. i'm a democrat, proud of it. i understand not everybody is. and i respect that. it's the nature of our system,

but i was sitting in my office and i heard that this guy, tom perriello, he is from, i see somebody not a. they know who years. really bright guy, he'll trained -- yale trained lawyer, who had formed a number of faith based organizations. democrat, conservative guy, great profile, really, really smart. was going home for august, you know when they do all these town hall things, and a bunch of people were coming to his town hall meetings. they were packing his town hall meetings. of all the strange things, and opposition to the cap-and-trade but it was the tea party. i thought what in the world is the tea party? i didn't get at the time. i've got it now. they're also talking about health care legislation, but cap-and-trade became a very important anti-cap-and-trade became a very important part of the tea party movement.

and it went from bad to worse. in the senate the very liberal environment public works committee took up the bill. it was pretty half-baked, even its authors would tell you that they had a lot of placeholder provisions in it. barbara boxer, california again, was very much in favor of climate legislation. and it was approved by the committee on november 1 by voting 11-one. there are more people than that on that committee. all other republicans boycotted because they were so unhappy. and the one was just somebody there for procedural reasons, didn't support it so that he did it what you need to do procedurally if they ever need to reconsider this thing. but it was obviously was given the 11-1 vote and given the fact that the republicans al all the

posts. didn't show up. were angry enough at barbara boxer not to even come to the committee markup. jim inhofe from oklahoma, very conservative, doesn't believe climate change is real. doesn't believe that science, is very skeptical about the whole thing. just refused to show up, and lots of others on the committee felt the same thing. so it was obvious we need to do something new. senators kerry, graham and lieberman wrote an editorial, kerry graham i guess was wrote an editorial in the near times, talk about a comprehensive climate and energy bill. they were very busy writing one. it was a big deal, and then they are trying to get a bill ready for the floor. and then the majority leader of the senate, mr. reid, announced that he was going to take up immigration legislation first instead of climate regulation.

graham, conservative republican, was also the key guy on immigration. he was furious. i heard some blue words come out of his mouth that i don't ordinarily here are from members not on the record. but he was very unhappy. they were poised to have a press conference on monday announcing their bill with a whole bunch of ceos standing up. grandma walked out and said not doing it. reed pulled the rug out. kerry and lieberman soldiers on. they came up with a bill in may, but without a key republican. and grant has managed in his tenure in the senate to become a key republican on a lot of really interesting issues. the bill went nowhere. his defection that resulting

from reid's decision to do immigration for us, which was usually imported from a nevada -- nevada perspective that he was worried, shockingly, about his reelection. there was won by the name of intellect laid who was running against him, a tea party or we might recall. decide who's going to do what he could on immigration instead of climate. he was afraid to take up climate. .. duck ultimately a lot of cap-and-trade supporters were defeated in the november election. rick boucher from the southwestern virginia who had been in the house 28 years and

had been a key to reach you really understands the sector. e he had been a key negotiating with the waxman markey waspair defeated. periello was defeated. the 48 page pledge to america uv butei republicans unveiled in advance of the election included their commitment to oppose be asn't anergy tax. a national and trade energy tax. no truth in labeling here. and my favorite, my favorite in this a very perverse sense was the commercial i caught one night with then-west virginia governor manchin, anybody from west virginia? well, they missed this, maybe, or maybe you saw it. had a rifle, and can he shot at a giant target labeled cap and trade. i thought, oh, my. i was quite surprised. he won, the climate legislation lost, needless to say.

the 112th congress looks hopeless for any sort of comprehensive cap and trade legislation. it ain't happening. i know that, it's one of the reasons i felt no guilt whatsoever at having quit my job and on to a new life. congressman fred upton who's the new chairman of the energy and commerce committee instead of henry waxman campaigned for the chairmanship in part by assuring his colleagues that he would not support cap and trade legislation. they were worried about whether he was too liberal or not. he appointed congressman john shimkus from illinois chairman of the environment and economy subcommittee. i've known john shimkus a long time, he's a great person. i love him to death. i disagree with him on this subject, though, however. he doesn't believe -- he opposes climate change legislation on religious grounds, on moral grounds because he believes man

cannot destroy the planet, that only god can, that it's this bible. he says it very sincerely that's his position, he's not going to promote climate change legislation in his subcommittee, i assure you. that is quite a contrast in politics from ed markey of massachusetts to john shimkus. and this guy has the jurisdiction over the epa. congressman darrell issa is the next chairman of the house oversight committee. of he's promised two oversight committee hearings a week. he's going to be a very busy man, and he's very excited to have lisa jackson, the administrator of the epa, come before him regularly. senator james inhofe from oklahoma doesn't believe in the climate science, is going to hector barbara boxer every day of her life, and he'll be delighted to do it. so there is just no hope for a pill. mean -- bill. meanwhile, though, so mow you've got electricity 101, you've got

cap and trade 101 -- i hope, the notes might help if this is going too fast. so now we've got to look at epa. what are they up to during all this? mostly, they're hiding under their desks because they're really quite worried about this new congress. i say that in jest, they're not. they are doing what they've been told to do by the united states supreme court in massachusetts v. epa, to regulate carbon. they do not have authority under the clean air act to do a cap and trade program. they have, they have issued a ruling that carbon is a pollutant, consistent with the supreme court's mandate. and they haved thed to work -- they have decided to work on, they've cut a deal with the auto companies as far as tailpipe emissions are concerned, and they have decided to go after regulating stationary sources -- refineries and power plants. those are big carbon belchers,

if you will. at least the ones that use coal in particular. and they're going to -- the gist of what they are doing is they have issued a determination that wherever you make a major modification to your existing power plant, you have to get a permit from the epa, or you have to get a permit to do that modification from your local state authority which acts under authority of the clean air act. under the clean air act, epa can delegate stuff to state mini epas, if you will. works they way for mercury, nox, not mercury so much, but sox and nox. that's the gist of it. the feds issue the rules, the states implement them unless they decide they don't want to implement them in which -- or that they're implementing them in a way that epa doesn't think is equally valid under the law, and then they take over the program. there's a tit for tat going on

in the state of texas. epa doesn't think they're properly administering the program, so they're harassing texas. so they're going ahead, they've issued this tailoring rule, a proposal for who is to be regulated. their initial rule was much more expansive in scope than these large stationary sources. they got a lot of grief in their record and politically for being so expansive, so they sort of pulled back a little bit, and they're going after these large stationary sources. and they're going about their business. now, they're very worried about being overturned by the congress. it could happen in a variety of ways, but so they have been very, very careful in the way they're approaching the rulemaking. gina mccarthy who runs the air program, knows the industry backward and forward, she used to regulate air in massachusetts. i've talked to her, there's a

power plant in boston that she participated in a deal to get it to reduce its sox and nox, and then it was supposed to close out. never closed down. she learned a lesson. so she's, she's smart, she's savvy. lisa jackson is as smart as they come, she was an epa staffer. she has a son who has asthma, she'll tell you that as part of her shtick as a speaker, and she is going to go about regulating not only carbon, but they're also aggressively pursuing other hazardous air pollutants, haps in the jargon. mercury is a very major source of what they're up to. so the, unlike last time where the, where epa -- excuse me, eei, it's the trade association for the investor-owned utilities -- supported what the congress and waxman and markey were up to, this time the

industry is just absolutely split wide open on whether they support or not what epa is up to. the heavy coal utilities -- progress energy, southern company, aep -- are the vast majority of the carbon polluters, if you will. and the numbers are in my presentation and be in that document that i mentioned. and they are opposed to epa doing anything. the clean utilities, that group i mentioned to you -- national grid, pseg, constellation, exelon, you know, florida/california -- are very much in favor of this. so there's a split in the sector. the comments that have been submitted in the apa rulemaking, i can just imagine what their secretary's office looks like. i ran a regulatory commission for a number of years. the comment that you get in a major rulemaking are, i mean, there are just stacks and stacks and stacks and stacks. they have who's who in the whole

electric -- actually, the whole nam chamber, american petroleum institute opposing what they're doing, and the clean guys sporting what their -- supporting what they're doing. and one of the reasons the coal guys are really worried about this, you remember i talked about that $500 billion in new investment that they need to put in generation? that doesn't even include carbon regulation. so it is a very expensive proposition. now, the clean guys aha, we're already clean. we have nuke la power plants or natural gas plants. they see this as a benefit to them. so as we talked earlier, it's, like, follow the money and what's going on here. the greenhouse gas requirements would be imposed on both existing and new utilities, so they have to involve of, have to apply the best available control

technology, bact. it's an epa/clean air act jar gone. they haven't defined precisely what that means. mostly they're letting the states figure it out, or at least that's epa's rubric now. what it really means is you have to make your power plants more efficient, and you are going to have to adopt programs to make your utility much more efficient in order to get a permit. you're going to have to apply scrubbers for coal if you haven't already. mostly, they're already scrubbed. and in many cases the cost of this regime is going to make a lot of the existing small, crummy, old, inefficient coal-fired power plants uneconomic. they're just not going to be able to compete in the marketplace, so they're going to have to close them down. exelon's announced, for example, they're intending to close down a couple of power plants in pennsylvania. thai not making any -- they're

not making any money. some people's world this raises reliability concerns because if you don't have enough power plants, it's hard to keep the lights on. but the industry has a record of getting these power plants built. it's pretty easy to build and permit, to permit and build a new natural gas fire-powered plant. it's not a long process. you have to have a site, a gas pipeline, stuff like that, but it's not hard. there's a recent study by my friend, sue tierney, of the analysis group that looked at -- she talked about the wharton economy, economic -- sorry, can't say it. at wharton in philadelphia a couple months ago about the reliability concerns associated with new epa regs. and the north american electric reliability council which is nerc, it's an industry-formed council with oversight by ferc,

and they have concluded there are not major reliability concerns provided the utilities get the new plants built. and so they're very busy planning for the new plants and the new transmission. i mean, be -- if your existing power plant's here and you're going to build a new one here, you pretty much have to get the transmission line from this one to go to this one, so that involves permitting new transmission lines. that's not fun, it's not easy, it's expensive. but that's what the industry does. it's what they've been doing since electricity was invented by thomas edison in the pearl street station in new york city, he built it as the first one, trivia that's just in my mind, i apologize. it's actually kind of a cool plant. it's a national historic site too. but that's what they do. that's what the industry does. and i'm absolutely convinced that if they are, if the regulatory certainty is there

and if epa succeeds, that the industry will get it done. so the question is whether that republican-controlled house will get the votes to pass something like rockefeller and say, no, epa, can't do anything for a couple of years. or yesterday i actually picked up a rag yesterday where the new chairman of the house energy and commerce committee said, hmm, he doesn't think that's the way they're going to go. this was not in your scenario because it happened yesterday. he wrote an op-ed in the "wall street journal" yesterday. he says he just thinks they should revoke epa's authority to do this because two years is not enough. so fred upton has thrown a little curveball in the middle of your scenario. you can check out the journal. i did it yesterday. this is just to make jim's job more difficult. and to throw a ringer into your plans. you're going to have to figure out whether that helps or hurts the override, and then the senate is another question.

i think there are going to be five, six, seven votes in play in getting to 60. and then they'll try, i'm sure they'll try and attach a rockefeller-like piece of legislation to a must-do vehicle. appropriations bill, debt ceiling, the defense authorization, there are just always these things, these must-have things. and then the question will be if they are successful in doing that and they get cloture, what will the president do? well, he has a very good track record on carbon. the epa has been very good about working with the white house and with carol browner in particular. she used to run epa in the clinton administration. she knows this stuff backward, forward and inside out. the rumor is she's going to be deputy chief of staff in the new, in the new crowd. but will the president sign something like this, or if it's on a must-pass bill, or will he veto it, and will they get to 67

votes? it's, this will all be wrapped up in senate politics, it'll all be wrapped up in presidential politics. after all, two years until the presidential election. there's a whole lot at stake, and that, in my mind, is what makes it interesting. thanks. >> thank you very much. [applause] we have time for lots of questions. >> yes, sir. >> sam from pennsylvania. >> picot customer? >> [inaudible] >> okay. >> it might be semantics, but was the decision directing the epa to regulate or just to give them the authority to if they chose to? >> i think -- i used to have a copy of that decision on my desk. i had it on my desk for about three years. i loved that decision.

but i haven't read it recently. they directed them to look at it. and the mandate is that they have to look at carbon and determine whether it is a pollutant and if they make that determination, then it will be summit to the clean air -- subject to the clean air act. epa in the tailoring rule, as it's known -- and there's just a ton of information on all this -- determine that it is a pollutant. they did a very lengthy job at making this determination and, therefore, it should be regulated under the clean air act. so there was some discretion there, but i can assure you that this epa was not interested in not regulating it. that's my interpretation. now, i will reread the decision, and if i'm wrong, i'll let you know, sam, but that's what i think. yes, sir. >> the scenario we've been given, the rockefeller bill, and

be i want to -- >> rockefeller-rahal. [laughter] >> okay. >> there's that pesky house. >> if it's a two-year period, in your efforts when will your lobbying efforts to extend that happen? will it begin once it passes right away? >> oh. they're ongoing. they don't stop. i mean, the, those who are in favor of what epa is doing and those who are opposed to what epa is doing are very, very busy putting stuff in the apa rulemaking record, they're very busy going to talk to the new members of the house and the senate, and they -- about either in favor of or posed to the rockefeller-rahal program, so it just goes on and on.

>> since it has been signed in law -- >> right. >> i assume the industry doesn't want regulation at all. >> no, it's split. industry's split. some like it and some don't. >> but the people that don't want the regulation -- >> okay. >> -- their efforts will continue even after -- >> absolutely. >> okay. >> and the way they will continue, the authority of the congress to say no will be challenged. they will try and challenge the law on whatever grounds the smart be lawyers think up. the, the -- i know you've got a speaker from the chamber, i think, next week, so i'm picking on him. he's not here to defend himself, i won't be here to defend myself when he speaks. they'll be very aggressively trying to help

rockefeller-rahal, they'll be very aggressive in trying to help the president decide to sign it. and then if clean energy crowd successfully gets to court, i guarantee you that the chamber and can api and nam will be in court on the other side. they'll move to intervene and the proceeding, i'm sure they'll have standing, and it'll be a off to the courts. so i think that having issued the decision in epa -- massachusetts v. epa -- the courts changed. and there's a very interesting, for the people who sort of watch the ins and outs of who's who in the court, they're likely to look and see whether the roberts court will come to a different conclusion on this and whether they have to regulate in the way epa did or not. so there's just lots of work forever and ever on this subject. it's a wonderful thing for the federal energy bar association.

and there is such a thing. [laughter] yes, sir. >> johan from vermont. when identify heard, like -- i've heard, like, a contrast between cap and trade and, say, the clean air act, my understanding has always been the clean air act was in some ways easier to pass than cap and trade because it was particularly focused on a limited number of coal plants primarily. but you seem to be giving, giving us the sense that in cap and trade it's also focused largely on these same coal plants as well. so in this your understanding what would be the difference between the fight to get the clean air act enacted and the fight for cap and trade? >> that's a really interesting question. i hadn't thought about that. the, one of the interesting con travises in my -- contrasts in this my mind, and it's kind of rueful on my part s that the

1990 clean air act amendments which were really a directive to epa to do what they've done on so2 and nox, they were conceived of and promoted by a republican crowd, and that same crowd has now disavowed the whole idea of cap and trade as they, as a vehicle or as a way of regulating. it used to be that the republicans were against, quote, command and control meaning, you know, the big, bad epa doing specific regulations that says this power plant has to use, you know, this kind of technology, the best available control technology. and they much -- and they were very much in favor of market-oriented policy like cap and trade. so it's very confusing to me these days about why that, why

that orthodoxy has changed and why it is difficult, why so many of the, those who previously had supported market-oriented mechanisms like cap and trade and be its allowances to, you know, limit the economic impact of a particular regulatory regime, why that's all changed. i really, frankly, haven't figured out why it has except for politics. and i think one of the reasons that cap and trade, the orthodoxy against cap and trade has become so strong is because the democrats have now embraced this market mechanism of cap and trade, and the republicans really pretty much had nowhere else to go. so it's, i'm -- it's confusing to me. i mean, they're not following the playbook that most of us would have, would have written. we thought that, that the more

conservative folks would have liked a market-oriented kind of mechanism. so these things come and go. you see a very different thing playing out with epa's efforts to regulate the hazardous air pollutants, the haps, where they are being very specific about the kind of technology they have to have in contrast to what they're doing on carbon where, thus far, they're leaving it up to the states to figure out. so some of the sort of traditional views about who would think what about what, i think, are just definitely impacted by politics. that's probably not a very satisfactory answer because i'm confused, and i know that, and it's hard to figure out. >> may i follow up and say that elections matter, and the tea group people got mccain to flip, they got all kinds of other people, upton to flip, and

change their minds. upton wanted to be chair, and he campaigned for it, as you said. changing his mind on this point, right? >> fair point. totally. they do have consequences, that's right. just like you had upon the changing his mind -- upton changing his mind, you had congressman kirk saying i voted for it, but now i wouldn't. >> it's a representative democracy. >> yes, sir. >> matt from delaware. in this instance you have the clean utilities kind of going against the dirty you facilities -- utilities. is it conceivable that the clean utilities ever consider kind of teaming up with the dirty utilities because of a fear that, like, once the coal plant's gotten cleaned up they might come after them? call 'em clean, but it's not like they're 900% clean -- 100% clean, so do you feel the everything pa might set their sights on them next, or is it they just want to make the coal

companies go through what they kind of go through now? >> for purposes of this discussion and this presentation today, i purposefully oversimplified some of the details. and clean and dirty, there are those who are sort of in the middle who might object to my characterization. i know they would. but, and you did have the unholy alliance, if you will, between the clean guys and the dirty guys as we went through the last congress with the edison electric institute which historically has been very conservative in its view of epa, of the scope of the authority epa used to have. there was an unholy alliance that was worked out, actually, by the ceos of the largest members of eei in a series of meetings that took about two years. ceos don't usually do the down,

dirty work. they leave it to the likes of me and my staff to do that. but they met in, you know, posh surroundings, weekends about two years and came up with this unholy alliance, the compromise where eei agreed to both the clean and the dirty ones agreed to support comprehensive, economy-wide cap and trade legislation provided ha they had enough -- that they had enough allowances to sort of make it relative of ofly -- relatively benign from an economic perspective for the first few years. so there was a long-term planning horizon they thought they could live with. so you have had alliances in the past between the clean guys and the dirty guys, my phrase. right now that does not appear to be the case, at least based on the epa, the comments in the epa rule makings, those stacks and stacks of papers i talked about. eei, the ceos meet first week in

january, maybe it's in scottsdale, of course, nice golf. i don't golf, but i've been to that hotel. it's a nice meeting. and they will go out there and talk. i expect that what they're likely to do this time rather than say, well, you know, we still support comprehensive cap and trade legislation because they know they're not going to get that, i think they're likely to say that we support energy efficiency legislation, and we support tax breaks for those of us who have to clean up our power plant, and we support sort of the new orthodoxy is supporting smaller, less comprehensive pieces of legislation. i do not believe, and i think there will be general agreement in the sector in support of those kinds of things. i do not believe that they will,

however, take a position on whether epa should be stopped in it tracks a la rockefeller-rahal because the split will continue on that. but they'll be united in things that give them the tools to begin to make the transition, that help them economically to make the prition that epa is going to require of them, but i don't think they'll come to an agreement on rahal-rockefeller type stuff or upton type stuff. because of the split. yes, sir. oh, i'm sorry. no, wait, you've asked. y fromy. .. you mentioned in the new initiations in the cap and trade they discuss ways to address price concerns. with the epa regulation, is it possible they may not have the authority to address that and so the costs of updating facilities and things like that could be passed on to consumers? >> epa does -- the beauty, if

you will, about a cap and trade system is you put a cap on the carbon, the amount, number of tons that are allowed, and you give a period of time to comply, and the cap, you know, comes down over time from, you know, down to that 80%. and you get allowances that are allocated to according to how our congress decides what to do. but they would have given 40% of the allowances to the electric utilities initially so that they would with -- be able to -- and they also would have been willing to sell additional allowances. epa would have sold additional allowances, and there would be a cap on what they could sell them for because there'd be a floor and a ceiling. and so they had the ability to,

they had sort of economic mechanisms that would sort of make the transition a much more tolerable transition from a customer and from a utility perspective. with what epa can do under the existing clean air act, they don't have a cap, they don't have allowances. all they have are command and control kinds of mechanisms. so i think what they're likely to do is instead of saying each and every power plant in -- you're from ohio -- aep's fleet or from southern ohio, okay. each and every power plant in aep's or synergy's fleet -- duke, i guess, now -- has to have this kind of control technology. they're going to say, well, as long as duke or aep sort of cleans up its fleet on a system average basis, they have some

ability to say to, quote, bubble where they deal with several power plants at once. so you can close down a bunch, you can close down one entirely, and you get the advantage of those tons spread across several power plants. they're going to do sort of tick key little things like that where they're going to try and build in regulatory flexibility. and try and be make it less onerous from a customer perspective, and they're going to give them time though there are time limits in the statute for how long it can take, three years, basically, plus the president can give them another year under the authority of the statute. once you apply for a permit, you can't give them 20 years to clean up their act. there's time limits in the statute. so i think they'll do what they can within the scope of their authority under the existing law to limit the economic impact. long-winded answer, but it's complicated. >> liz from philadelphia.

and picot, so thank you. >> as long as your parents pay your bill. >> they pay it. so, you know, yesterday we talked about possibility of even though there is the bill going through different avenues such as congressional review of the regulation or through appropriations to block funding, and going through the freshman members last night, it's becoming clear how hot button an issue this is and saying two years wasn't enough and this needs to be a comprehensive action, what -- how realistic would it be for us to really pursue those other avenues instead of trying to pass the bill, but going through congressional review appropriations? >> well, i think what you have is people like rockefeller, and there is a, there's a, an ugly partisan war right now where inhofe is blaming rockefeller, rockefeller is blaming inhofe for the failure to stop epa in

its tracks in the lame duck because rock fell beer didn't agree -- rockefeller didn't agree with the inhofe approach and blah, blah, blah, blah, blah. but i think what's likely to happen is someone like rockefeller talking to his colleagues, and it'll include the kerrys, and it'll include the liebermans, and it'll include, you know, the whole spectrum. it'll include the senators from maine, for example, those who are just all the time on the bubble. and those are the people you'll ultimately concentrate on. it's going to have to figure out what the sweet spot is. and i think that you would have a rockefeller piece of legislation -- not just the disapproval under the, like murkowski -- i think you'll have a rockefeller-like piece of legislation that'll get tacked on as an amendment to something else. i don't think he will, it's

likely that he'll get passage of his bill on a stand-alone basis. congress hasn't even started yet. you don't even know who the committee members are going to be for those new guys yet, so it's really hard to predict. you don't know, you know, what other sort of zigs and zags in the road are likely to emerge. but i would speculate now that it would be a rockefeller amendment unless the ugliness between the parties on his approach gets too bad. or maybe it'll be rockefeller-murkowski. or maybe it'll be rockefeller, you know, whomever. rockefeller-manchin? ooh. [laughter] will get tacked on to an appropriations bill or, you know, the debt ceiling or what have you. and that gets really interesting if you're a student of the senate. i worked there a long time. what reid's going to do, for example, and if on the debt

ceiling he could fill out all the ability to offer amendments called filling the tree and preclude and then if they get cloture on the debt ceiling -- and i just use that as an example -- then a rockefeller amendment in the form of his bill would not be germane. and so he couldn't offer it to something like that, so he'd have to have the votes to overcome determination he wasn't germane anyway. so the procedural stuff is, is a big deal in all of this. believe me, i've been in meetings where people just talk about this endlessly. it's because it's what they do, it's what they're paid to do, and most people who get involved in these discussions love it. that's why they're doing what they do anyway. >> can i follow up on that? >> yes, sir. >> the freshman and others are going to try to change the filibuster rule. you mentioned getting cloture in the middle of this. do they have a chance? >> right. jim, i don't really know. i haven't, i haven't seen a vote count on it. i haven't -- i've read the

articles, and, you know, the rags that i read. >> yesterday there was an op-ed on it in the post -- >> i didn't read the post this morning. you get the early bird award. [laughter] >> because i, personally -- >> that's what he does, you knowsome. >> personally, i don't think they have a chance. >> i doubt, i doubt that they do. >> right. >> but i haven't seen a vote count. >> because that -- >> that would be a big deal, yeah. >> on the whole procedure. >> and i think those are on the margin each of these times. the collins and the snowes and i don't know who else you want to use, would be afraid of that. because it's the whole thing about the majority tromping on the minority. that's a big deal in the senate. house it wouldn't bother in the least. you agree? >> yeah, i agree. other questions, please. i didn't mean to interrupt. >> my name's sam from be minnesota.

obviously, the current administration is very supportive of climate change legislation and moving the epa forward in this direction. i guess i'm wondering what the regulatory stability might look like administration to administration and whether these are some things that could be, like, a moving target going forward and whether there's concern in the industry about that? >> there is always concern in the industry about what the next leader of any agency is likely to be like, is going to be like. i was at that epa, at that scottsdale eei meeting that i mentioned happens every january -- weather is nice in scottsdale in january -- when lisa jackson, you know, newly announced as the administrator of epa in december as part of the obama cabinet walked in to

eei and gave her maiden presentation to eei. some of these meetings the guys go golfing. not just ceos, but they go golfing. every single person registered at that meeting was in the meeting room at 8 a.m. in scottsdale. everybody was curious about lisa jackson. and she gave what i would say was a wonderful performance be. she walked in, she said who i am, you know? the son of, or daughter of a mailman, kid with asthma, worked at epa, worked in new jersey, i'm a grown-up, i know what i'm doing. i want to listen to you, i will hear your input. we're going to, you know, work this out together kind of discussion. and actually got a standing ovation. i don't think they'd give her a standing ovation now because they're now more afraid of her than they used to be. but who might be the next rees

saw jackson -- lisa jackson? who might be the next chairperson of ferc? who might be the next climate czar? there's always concern in any industry. it's not limited to the electric sector, i can assure you, about who is going to be their regulator. and as jim said earlier, you know, elections do have consequences. so i don't think that she is, has any interest at all in leaving in the middle of the first term of the obama administration. i don't believe gina mccarthy has any interest at all in leaving in the middle of the first term of the o obama administration. i think they are consummate professionals who have backgrounds, both of them. it's not like they chose some, you know, college professor from minneapolis to do these jobs. i'm sure there are some very competent college professors in minneapolis, i might add -- i just got myself in trouble.

[laughter] but they chose pros. and to, to lead this. and i don't think they're going to leave before at least the next two years, and maybe there'll be four years after that. so there is concern, but you also just have to, you know, you just have to take the hand you're dealt. some, some leaders of -- i'll choose ferc, some are very popular with the industry, and some they just hate. but they come and go. have i worn you out? yes, sir. >> does exelon use anti-lobbying firms, do you engage in coalitions and use, like, legislative specialists? and how does the corporation interact with all those? many specifically, how do you decide -- if you're using an outside firm and they say, you know, maybe we should form a coalition, how does the corporation decide whether

they're going to do that or not? >> um, exelon is, um, different than a lot of companies in the sense that they have, well, they had me for ten years, you know? [laughter] and having someone lead a washington office of a major corporation who has, you know, 30 years regulatory and congressional experience is sort of not typical. so, but exelon makes a lot of it policy decisions using its own in-house expertise. it's a big company, they've got people who understand the clean air act. they do this stuff every day, they're used to permitting power plants, and they know all about, you know, the intricacies of their plants. even having said that, though,

exelon is big joiner of coalitions. eei is a coalition, trade association. u.s. cap is a coalition, clean energy group is a coalition. exelon was a part of the u.s. chamber. we got so angry at the u.s. chamber hitting us like that with their, with their opposition to cap and trade that we quit. the chamber mostly decided we'd save the money, that the chairmanship members the bill came -- honest to goodness, it's a good story. the bill came, and the ceo cose chief of staff said, hey, boss, do you really want to continue to pay these guys who are beating up on us? he said, no. and so we quit. and it became a big story. it was very fun. but they use outside lobbyists, they use, there's a, they have a person under contract that is a contract lobbyist who used to be the regional administrator for

the epa. her name's mary, she's great. she knows what she's doing. they have a firm under contract that was -- and these are all public filings anyway because, you know, if you do this, you have to be, file lobby being reports. they have a former head of the council of economic advisers, republican, who's a contract lobbyist. and, but the ultimate corporate decisions on what the position is, will be are not made by the outside lobbyists. they're made by the in-house people. i don't make them anymore, i'm a has been, but my successor does working with the other senior officers in the corporation. and that is a very typical model where you hire a lot of outside guys. southern company has a huge lobbying phalanx of people. i jt use them because they're tit for tat in the industry. they have, they spend about five

times what exelon does on federal lobbying. they have huge offices, and they do it very, very well. so whether you're clean or dirty, you know, white or red utility, they typically have outside -- some utilities just have itty bitty washington offices. i have a friend who used to be on the energy committee staff who is the washington office for washington state utility. they just don't spend that much. >> betsy, thank you. >> sure. thank you very much. [applause] >> [inaudible] thank you very much. we're going to take a 15-minute break. we'll come back at 11:00 sharp. thanks. [inaudible conversations]

[inaudible conversations] [inaudible conversations]ib [inaudible conversations] [inaudible conversations] [inaudible conversations] >> now, more for that public affairs institute. james thurber discusses the history of lobbying reform, including current white house policy. professor thurber worked with both president obama and senator mccain on the lobbying reform proposals. this is an hour 15 minutes. >> good morning. as you know, i'm jim thurber, director at the center for presidential studies and founder for the public affairs and that

is the institute. this is the to do. and i'm going to talk this morning about the causes, characteristics and consequences of lobbying reform. i will encourage you to the reds need anytime if you have questions about this. lobbying reform has occurred not only on capitol hill in 2007 in the historic bill does pass, but also by the efforts of the president of the united states, barack obama and his executive order. and like to start out with a question to you. he promised in his campaign to change the way washington works, pointing directly towards the role of lobbyists campaign money and other goodies here. so my question to you is do you think he is change the way washington works? now my students are usually very active in terms of doing things.

they usually wait for a lecture rather than the first question, but i want to get you engaged. what do you think? [inaudible] >> no? [inaudible] >> you don't think so? [inaudible] >> so he hasn't changed campaign-finance and that the key role here, but he is changed in terms of who can be hired for the white house in your case? john. [inaudible] >> you had your hand up. anyone else? >> i think it's such a long process. it's great that he's releasing them and there's quite a bit commentary about who's going to the white house how many times, but that's not stopping them from going. >> right amica go to the white house visitors in the who's

coming and people like former senator daschle has gone many times to go there with respect to issues before congress, especially health care reform and not more transparent. has that changed things in the way people lobby? well, we're going to talk about this. he doesn't have the power. why do you say that? >> he can change we invite the white house if he comes to the white house to visit him and his staff, but he can't change how people visit and influence congress. >> right, so there's two different jurisdictions. there's congress and we just had an election. we hit an historic height of $4 billion in the last midterm election in terms of the amount of money spent and that significant. and and he cannot really influencet

that unless he pushes for some legislation to counteract the existing law with respect to campaign finance and recent supreme court cases thatzens un citizens united versus the fec.h has he changed the tone of washington in terms of lobbying to think? or have you thought about it? this is a major campaign promise. >> i think he made the lobbyist look more evil, at least in the general public. >> so the general publicic. generally doesn't thinklly lobbyists are very good unless it's their lobbyists. and hee reinforced that attackih lobbyists in the process of some kajor legislation going throughc stimulus package, health careagn package, cap-and-trade in a variety of others, saying thesel people are really manipulating financial reform.ip they are manipulating the waygta washington works in a nontransparentre way.

bad. so he's rhetorically try to change things. hasn't changed things -- has it changed things? you don't know, you don't care. yes? >> in some ways he really wants to change the lobbyists that he is against and lobbyists are supporting his agenda are the ones he's kind of like still talking at their meetings and still supporting whatever lobbying they are doing. >> you have to listen to the rhetoric and language carefully. he said when asked you i guess these lobbyists. what about the federal registry lobbyists that are coming and talking to you. he said they are stakeholders and they are okay. truman said years ago that he attacked lobbyists also, and when some lobbyists were supporting him, he called them good american citizens. so we framing is important, and there is a certain amount of anger actually am an lobbyists

for the way his attack them but also when he likes them, he said there could stakeholders supporting him. when he doesn't like them he attacks them. i want to talk about how we got to the stage with the president attacking lobbyists, and how we got to the stage of passing reforms on the hill. in 2007 comment and how he has passed several executive orders. the first executive order that he passed action after coming into office was related to lobbying. if you look at the handouts, i have a brief discussion of a very complex and heated time where there were scandals related to lobbying. we all know about jack abramoff, from 2004-2006 there were investigations of his activity. eventually he pleaded guilty to fraud, tax evasion and conspiracy to bribe public

officials. and he was given five years and 10 months sentence for that activity, but there were other things going on at the same time. representative duke cunningham from san diego ended up taking money, bribes, for earmarks. he was on the appropriations committee in the house of representatives, the chair of subcommittee on defense appropriations. he was also part of the group that passes the black budget, meaning money for the intelligence community. and so within the discussion, and there are few people, it's not open to the entire committee, the discussion of the black budget he earmarked money for contractors in san diego that didn't have even a track record of digitizing top secret material for the army. the army didn't even want it. and they gave him a rolls-royce, used a rolls-royce. he had to get it repaired. they bought his house in san

diego for above market value by 700,000. they gave him all kinds of antiques. and in the end, he was sent to prison. he was guilty. there were 26 staff members, and members of congress mainly the house of representatives during his 2004-2006 period that were investigated related to jack abramoff, but other people god-given gifts. abramoff and others had given travel, free travel to scotland, to england, and in to scotland to go golfing. and the issue, therefore, a free travel, remember, as well as gives came up. there were also issues, spouses lobbying and children of members lobbying for particular people. and i came up as a controversy. if you look at other causes of reform, sort of more general

generic ones, americans in polls, but also reformers who are very concerned about the bundling of money in the lobbying activity -- with what's bundling? >> bundling, my name is sam, i'm from minnesota. is a fund-raising technique where a single person collects a whole bunch of checks and the diligence of them all at once. so even though there's individual limits for how much can be given, a bundler can collect hundreds of thousands or even millions of dollars and deliver it all in one big bundle. >> so there was a practice in washington by lobbyists and lobbying firms to have little lunchtime meetings were a candidate with come in and speak to the partners of a law firm, and they were all expected to give the maximum amount of money as individuals to that candidate, but it was clear that

the lobbyists associated with a law firm, lobbying activities of the law firm, had sort of organized it and that person was a bundler. in some cases on checks they indicated at the bottom in the notation where the money came from in terms of bundling as was the actual individual giving money. so around america we would have bundling parties, and a lobbyists helped direct that money and, therefore, later had better access to people. that was the dude. they also had an increasing campaign money. i mentioned 4 billion in 2010. it was 5 billion in 2008 for all candidates. primary, general election and all the federal candidates. it's going up quickly. that amount of cash, data from amount of money, the amount of money that members were going after as well as presidential candidates caused some concern about reform. and the proximity of votes to

campaign contributions, it's still an issue. in the "washington post" just a few days ago, there was a front-page article about having campaign fund-raising event on capitol hill within a few days, within a few hours of a vote on issues related to the campaign contributions. that has been going on for years, and that was part of the lead up to the reform, and is a loophole right now that people are concerned about. they guess to members, the travel to members of congress as i mentioned before, are important. surveys, one of the surveys i did physical offers congressional election study surveying 38,000 people in the united states before and after the 2008 election showed that people were very concerned about lobbying. in fact, in 2006 was the most important issue. scandal in the lobby was the

most important issue even though we had a war going on in 2006. in 2008 it became the third most important issue after the economy and health care. anger with congress i think partially is related to the perception, it's not the reality, of the relationship that congress has with organized special interests. that led to reforms also. and the fact that the ethics committee and the house and senate really were not doing anything about it. no investigations. they went very light on members, and part of this might be because the pew review. when you have peers reviewing you and that person has to be very powerful, you're careful about coming or careful anyway but you're careful about really going hard after an individual that looks like they have crossed the line. in fact, with respect to

abramoff and the 26 people who were investigated, the ethics committee and house had no investigations over that. then there's the lack of enforcement that became a concern. the enforcement of the lobbying law is done by the u.s. attorney of the district of columbia. there have been thousands of referrals by the house and the senate, according to senator dodd who is chairman of the rules committee when this report came out. thousands of referrals and no investigations. so people were concerned about that at the increase in lobbying expenditures also became a focus, and as you can see by the figures it's grown dramatically. the estimate in 2010 was done in september. it's likely to be even more than

this, but let's look at what this means. in 2009 it was three pointer $40 billion. billion dollars. that's $8 million per member per year. that's $291 million per month, $67 million per week. almost $10 million her day, and $412,500 per hour. this place is awash with money, and it's only from the federal registered lobbyist. it's probably a factor of three times this. so people became concerned about this outside of washington. this key group movement certainly mentioned it. the press mentioned it. the hill is not moving too hard on reform since 2007, which we will talk about. another cause of reform was the revolving door.

in a study from 1998-2006, 43% of members who left congress and who were eligible to lobby became registered lobbyists. no one ever wants believed that you leave washington. daily for a while and they get sucked right back in. what can you do in washington? you can get into the advocacy game. there's also the case tree project. does anybody know what the k street project is? help me out. go ahead. >> major lobbying firms were hired on partisan lines? >> yes, they call the k street project in every tuesday babies when this our staff were leaving, helping staff get jobs, but also when members left they helped them. but also they watched associations and who they hired, and tom delay put heat on three big associations for not hiring or looks like they were going to hire republicans.

it, let me tell you, was done by democrats also. they just weren't as well organize and he didn't name it. it is still going on in formally, although there are big signs if you are caught pressuring an organization to hire somebody. and we'll get into those fines later on. the idea was, well, we want to get our people into the firms. put pressure on the firms, bows between democrats and republicans. they do that naturally anyway. the k street project is named in law, and there is a reform that restricts that activity from the hill. and it has not changed in terms of its got a nontransparent way, and people to help others get jobs, but it's not done by the party leadership. and then there was the case,

cases of people negotiating for jobs. there was a chair of the energy and natural resources committee that was negotiating for a job with the pharmaceutical association, big pharma. while he had before his committee the medicare prescription drug bill. and it became a huge scandal. others were doing the same thing. it was sort of happening less visibly for many years where people were sitting on a committee, dealing with an issue, that later they would represent or an association. huge conflict of interest. obama wanted to reduce the revolving door, stopped the revolving door, people in the government and out of government. and the reforms wanted that, too. if you look at this come it looks a bit complex. the network analysis, in june 2006, and don't worry, it

will not be on the final exam, of people moving in and out of hhs come in and out of the white house come in and out of the finance committee and the house, senate, part become in the science committee, department of labor, individual senators, kennedy was known for helping a lot of people. these lines show the interaction of the revolving door going to agencies, going to committees, going from committees to agencies and back into the white house. if you look at this, this clears it up a little bit of 98-2006. this is a network analysis of people going in and out of the white house that were federal registered lobbyists from law firms and lobbying firms. this is what obama wanted to stop. and it did, actually. sort of. we will get into that. let's take a can dump, these

declines but they were both successful in getting people in and out of the white house. cassidy and associates. wechsler, now wechsler walker. used to be in the white house and she had a lot of people understaffed or in the white house going back and forth. hogan hartson, timmons which is a small firm in and out. he used to be head of legislative affairs. these other triangles are just one individual in and out. so you can see that there was a pattern. a significant pattern of people in and out of the white house. the president thought there was a huge conflict of interest. and so one of the first things he passed, the executive order was for the first time in the history of the united states, he said no federal registered lobbyists can go into government, into the white house as mentioned, but also into executive branch level

appointments, unless they go through a process of exceptions. now, the exceptions are up to 26 the last count, out of several hundred, that really stop people going in and out of the white house. there's some consequences for that which i will talk about later, this gives you a graphic description of what the president was trying to stop. if you look at reform in 2006 to the president, i'm not going to talk about all these, but you should realize there's a lot of warm gush a lot of reforms going on. that means on the lobbyist and the mbs of congress really like to do that, rather than changing ethics on themselves. and they were criticized for that but the worst ethics reforms on members. there were also rules and procedural reforms. the most important one was related to your marks.

your marks not only for appropriations but it marks for tax code their marks, but also authorization in marks. we here in the press, we read in the press about the appropriations earmarks, that there were new reforms on the. there were also procedural reforms in terms of the way the minority was treated, and some of them have been ignored. there were also reforms with respect to the budget process and a bright of others in terms of rules of procedure reforms. there's campaign-finance reform. for 75 years we have built up campaign finance reform to have more transparency, more limits on contributions. limiting, we'll get into this later, limiting the lobbyists from bundling over 15,000, friday of other things, and then along came the citizens united case, which really change things significantly.

and then we also had redistricting reform. there was a group of people, i was on a committee, still am, to try to get commission to do a redistricting because of the partisan and bipartisan redistricting that's going on to create seats, i'm one of them, that things it undermines the capacity to have more moderate in the house of representatives. california passed an initiative inc. 2010. 2008 they passed the initiative for the state legislature to the commission to do it. and now they have an initiative to do it at the federal level for congressional districts to have the commission do it. now we have 12 states that have some form of commission that is redistricting where they have more competitive seats. the idea is that it had a commission to accommodate equal population, but you also bring in the variable, let's have more

competition. we will see in california whether they can do that. after the 2000 census there was only one district out of 53 in california in the first election that was competitive, meaning people one by 55% or less. this last election it went up three, which was a very competitive year, and yet one would think that you could have a few more competitive districts than three. so that's part of the reformed stream that went on. then the president, executive branch as i mentioned a couple of times, pushed for reforms coming out of promises in the campaign. what was the promise in the campaign? the campaign promise was, i intend to tell corporate lobbyists their days of setting the agenda for washington are over. they have not funded my campaign, and for the first day as president i will launch the most sweeping ethics reform in

history. well, he launched the reform. he promised to have no federal registered lobbyist in his campaign, when he was campaigning. he did get 60% of his money from small contributions which helps. he had an ungodly amount of money, $745 million which helps. he didn't take public finance as he promised he would early in the campaign, but he changed his mind. and mccain did take public finance and he got 43.1 million. welcome he got lots of other money from other sources, which helped him but not 745. so both mccain and obama promised not to have campaign -- not the federal registered lobbyists in the campaign. one and thousands showed that mccain had 42 of his top campaign staffers were recently lobbyists or advocates.

23 campaign staff for obama were recently lobbyists or advocates. and i'm including advocates are there because people like senator daschle was a key adviser in the campaign. but he was not a federally -- federal registered lobbyists as most people in washington think he is a very effective advocate and that gets us to the question of what is a lobbyists? the definition of it which will get into later, and if you look at these data, they are different than what i presented the other day. i went to the office of public records to check, and my earlier date on this are wrong. so throw those out. these are the latest. you can see that we have about 12,000 to 14,000 federal registered lobbyists. it hasn't dropped dramatically as i asserted. from a secondary source in my

previous lecture. so i wanted to correct that. yes, we make mistakes. it didn't seem quite right to me, and i have been using those for a while. i went back and look at these. why are these different? the methodology is these are the unique registrations, not multiple registrations. for example, of a law firm has an individual that's registered for five different kinds of things. they have five different registrations sometimes. so this is a more accurate number of the actual number of people in the business that are federal registered lobbyists that actually registered. now you've seen this before. i want to repeat it. that if you look at the people actually in the business in washington, there are over 40,000 people who are listed in the government affairs director. why would they have been in indy government affairs directory unless they were involved in government affairs, trying to influence government? they are in there.

they are proud of it. it is used as a way to find people by certain sectors like energy, and viacom education, et cetera, to see who's involved in the business. and if you look at, and we've done this, i've done this through my center, at the people supporting those people, support staff. it's up to 87,058. the actual numbers in this book. so the business, the industry is much larger than 12,000 people if you take it was going to say they are in government affairs, people supporting them. that doesn't count people producing television ads, doing survey research, people anything takes in washington, d.c., better in the advocacy business to a great extent. it doesn't include people who are doing blogs, working the internet. so the 12,000 is the tip of the iceberg, and the money

associated with a 12,000 that's reported in those earlier tables, that's just the tip of the iceberg, in my opinion. i take a factor of three, approximately, times the figure. $3.4 billion. let's call it $9 billion that is being spent in washington at any time. that's a lot of money awash, along with the 4 billion in the last election, election campaign. let's call it 10 to $15 billion of money in washington. that is an issue. who should be called a lobbyist? well, i briefly talked about this the other day, but let's get into in greater detail. the legislative disclosure act of 1995 recommended and 2007 said that if you have over one

contact, in other words, to contacts or more of members of congress, senior staff, not junior staff, and a list of executive branch executives, public officials, these appointees, it's over 5000. and you spend 20% of your time on -- this is a quotation from the act, lobbyist activity. not lobbying activity but lobbyists activity which means contacts and efforts in support of the contact. and you are, have an income of $5000 per lobbyist each, and that is each quarter, use the semi-annually, and 20,000 for an organization like a law firm or some other association, you must register. you must register with the house and senate. you must indicate who you are

working for. you must indicate the policy that you are working on. you must in some cases identify the bill that your lobbying on. and this applies to people lobbying the executive branch as well ask congress. that is very different than all of these other people that are in the government affairs director. some of them don't have direct contact and they don't spend 20% of their time, and so they're out of it even though they may be making more money from an organization, you need to all three of these things. so there's some problem, some loopholes in the law. in 2007 after basically three to four year battle over what should we don't about lobbying reform, the honest leadership and open government act was passed september 2007. it commanded a variety of statutes to its in your hand

that. i won't go through those. including the indian assistance act, because the issue of tribes giving money to obama -- pardon me, abramoff came up and mccain had hearings on the. i happened to them. at the hearing and give suggestions for change so that they would not have anymore problems in the future. that's part of this also. and also, they admitted the pension provisions in civil service retirement because you luger pension now under this act if you are convicted as a duke cunningham was taking bribes and breaking the rules that exist in this act, in the previous act. now, if you look at the act itself, this is great detail

that you don't have for yourselves, but i just want to summarize it very quickly. first of all, they said that within three days of a job negotiation you had to go to the ethics committee ideally before negotiations, and identify that you have a negotiation going on if you're a member of congress, house and senate, and it's related to wha what you were dog on the committee or your assignment. and you have to recuse yourself from anything related to that particular organization that is offering your job or your having negotiations for. there's a two-year revolving door. there's a two-year limit on the senate for senior staff and for senators. and in some cases members in one case, senator lott, resigned his seat before this went into effect in order to have a one year limit on his activity.

he is now a federal registered lobbyists. and in the house they didn't change. there was great pressure to change it into years. the house kept the one year revolving door as did the two years revolving door in executive branch. there's some positions in the executive branch related to intelligence defense where you have a lifetime prohibition from lobbying the companies or the organizations that you are associated with. there's a limit that spouses cannot lobby. there's the gift ban, a ban on travel. a great detail on that, very controversial because there were lots of times when people would take it gets out to their tuesday thursday club. they go to california on a private jet. on thursday and it was a lot better than what happened this

last weekend with a couple that with commercial aircraft. we will get into this later because some of the nonprofit organizations like the aspen institute would bring people regularly to aspen for seminars, and he didn't want to have limits on that. so i think it's a loophole. i will get in my -- get in trouble with my friends at the aspen institute and other institutes, but when there's an activity going on with a nonprofit organization you go to the ethics committee to get permission and you can take a private jet to those places, as long as there isn't a federal registered lobbyist on the applet. frequently there's a ceo on the airplane that helps fund the aspen institute, and they're able to talk or council for the corporation. i think that it's a significant loophole. we have specific provisions in

the 2000 act that prohibits members and their staff from quote, influencing hiring decisions of private organizations on the sole basis of political partisan political gain. there's a fine and imprisonment up to 15 years for this. there have been no investigations, and no one has been fined and no one has gone to jail over this. and i think that if you look at the iron law of reciprocity, i will help you if you help me come if you're a former staff member elite and you want to hire somebody, there is an informal network of hiring people you know and hiring people from your own party. it still goes on. it's hard to legally prevent that from going on. and as i mentioned before, there's limits on charter to charter jet travel and gifts,

and there is theoretically full public disclosure of lobbying activities. of those, through a federal registered lobbyist. four years academics like myself and reformers and the outside wanted electronic forms on the hill that were easily searchab searchable. i appeared before the rules committee in 95 to push this. they did it again in 2007. finally, it happen. so now they have the forms for the house and senate that our electronic. they are searchable, and it's producing a lot of good research but it also brings more transparency. however, there are all kinds of problems in terms of filling out the registration form. there's a lot of freedom in terms of indicating who you are lobbying, but also what you are lobbying, and how much you're spending on it. so yeah, it's transparent, easier to get to, but we still have some problems in terms of equality of the material.

this is what scares lobbyists. there's a 50,000 to $200,000 fine and a criminal penalty up to five years for knowing and corrupt failure to comply with the act. at that point, there were a lot of people in town that said, gee, should i be registered? attest that are huge penalties. if you are registered and you get into trouble. i that heads of firms in town say that they reviewed who the federal registered lobbyists were in their firms and they decided to be registered and. i've got lots of discussions with people that said that, we're trying to be good citizens but, you know, if we register, and somewhat investigates and we get into trouble, we'd it's better not to be registered because don't its investing those who are not registered.

it's an issue that we can get back to later. because there was a lot of information about what was going on in terms of the invitation of the 95 act and previous acts to that, the congress decided to give the government accountability office the right to have, the responsibility of having annual audits. this has caused people to focus on the outside because they come in and they audit what people have been doing, who has been supporting them in the firm, because that becomes part of the reporting requirement. they are looking at lobbyists compliant and disclosure by federal registered lobbyists. they are not looking at yet people who may be should be registered and are not registered in washington. they are looking at people are registered.

so again that's created an incentive for some people to say wait a minute, maybe i don't have to register. if i don't register their won't be an auditor also, there's an annual report, annual report by gal, and annual report required by both the ethics committee and the house and senate as to what they have been doing. and the conclusion of their investigation, and again they haven't really pursued this heavily. there's also a form of a public integrity office as separate from the ethics committee in the house of representatives chaired i david skaggs, former member from colorado who don't appropriations maybe -- committee. well respected guy, they did a series of investigations of eight members for example, recently in terms of earmarks and campaign contributions. one of them is a former member who passed away, john murtha,

and others. and they also investigated maxine waters who now is being investigated and there's going to be a trial before the ethics committee and the house of representatives. they also represented wrangell, former chair of the represented wrangell, former chair of the ways and means committee in the house of representatives. and they said that publicly, the hole three was if you send these things publicly you and there is or you will put pressure on the ethics committee to do something. there's great conflict between the two, and lots of members who mumble and say we should get rid of the house of public integrity. is causing too much trouble. but i think it's going to be very hard to get rid of, and i think the republicans are fully in support of it, for example. if you look at the disclosure

of, further disclosure of activities by members of congress, they have to certify and sign a document that they have not given gifts or traveled that would violate senate and house rules. where did this come from? if used to be a wicked tickets to to games, boxes at basketball events and hockey were readily given and not recorded. by the way, jack abramoff had a restaurant. yo a restaurant downtown where members and staff would come there and eat and the bill never came and they could drink wine. the bill never came, which against existing rules, and they're investigating that. there were literally dozens of members of congress and staff that would go to that restaurant, signatures. and that really didn't go anywhere. they investigated it but obviously they were breaking the law. so some of this is related to that activity. if you look at the question of

transparency, there's new transparency with respect to the question of bundling. and the bundling aspect is that it pays lobbyists, federal registered lobbyists, okay, could be an advocate that is not registered. if they bundle over $15,000 semiannual and campaign contributions for any federal elected official, or a leadership pac, and the leadership vacuum that is when you coming to congress, even freshmen have been now, it's a pact that they create, they come from a safe district and the tournament and give them money to others. the leadership has always had them but other people that have also. henry waxman had them, has one. so if you give to one of those packs, over 15,000 in bundled money, then it becomes, you have

to report it. lobby is sort of like this. because they didn't have to go out and bring in hundreds of thousands of dollars in bundling and so it was like a lot to do it all time, my gosh, this is great but i don't have to do it allmore becae they .. stopped before 15,000. there are other ways to do it, other loopholes. it requires lobbyists to disclose to the secretary of the senate and house clerk campaign contributions and famous to presidential libraries, to inaugural committees or entities controlled by common name for honoring members of congress. this is the issue related to represented wrangell. and it is the agent associated with many research senators -- research center is named after members of congress. i am involved in the establishment of the association

of centers for the association of congress, and there are over 20 -- pardon me -- that are named after senators or congressmen. there are no limits on how outside interest getting money to those particular centers. if you continue, there was earmarked reform. earmark reform i want to summarize, you don't have to read it off the screen. basically that you -- to earmark reform just before this reform would too, there were 15,000 plus their marks. and in what is of course a provision in appropriation bill but also a tax bill and authorization that nearly caps, put in before this went through in a non-transparent way for individuals, corporations or a particular district, a road, bridge, whatever.

and now it's under the requirement of the earmark reform which went through with this package is that you have to identify the individual advocating for the denmark. before there was some geographic quadrants in the act that were put in after a conference committee report and you didn't know what was until he started figuring out, it's in west virginia. senator byrd from west virginia, or it's in alaska. kennett anybody's name, no justification. has to be a person's name, justification for it. it has to be up on a website for 48 hours at least, and judges sign an affidavit. no one in your family or the individual advocating it would benefit from it. so it made it easier to vote on it, and it made it easier for people in the outside who are critical of these to do something about it. so we went from 15,000 earmarks

down to 8000. we now have creeped back up to 9800. they are smaller now. there's great pressure on members to have their marks i the local public, local public officials, mayors, city managers. so they see on this website who's getting earmarks. so i had never segued a minute, this is putting a lot of pressure on the because there's more pressure to add even more in marks because they know who is getting them and they are not getting them and they are very concerned about that. earmarks have had other reforms in the house of representatives, congressman o.b., the chairman to progress in committee in the house of representatives but other limits on them. know in marks this last cycle could come out of this committee for a for-profit organization. and also you could not have your

name associated with in marks. this is where represented maxine waters got into a confrontation on the floor of the house of representatives when she had earmarked money for the l.a. school systems have been turned around and sent it to a school that was named after her, and that was pulled out as an earmark from the floor on the house of representatives when congressman obie found out about it. it was quite confrontational and the press covered that. as i mentioned before, restrictions on travel. and there were also a series of things that president obama did. now, let's go through these in some detail. for the first time as i mentioned before, he restricts people that were federal registered lobbyists from going into the executive branch and

into the white house. and also it was before, there was a two-year restriction on the way out. by the way, just historical note, clinton had that also but within a few days before the end of his administration, he dropped it so a lot of people would leave and go into the lobby is this. but it was put back in by bush and obama. there is restrictions of gifts to the executive branch officials in the executive order that was passed, the first day in office. there was a gift ban before that but it was very specific now. even more specific. so if you're in the executive branch, you and your appointees don't even accept a cup of coffee from anyone on the outside. that's the best rule. he also required new appointees to sign a code of ethics. that's quite extensive. it's in the website of the white house, the office of ethics,

headed by norm eisen. there were limits on lobbying t.a.r.p. you could not do it in person. you have to do it in writing and it had to be public, and yet there were other ways around that, at the lobbying for the distribution of money to banks and insurance companies and others, by really top level lobbyists were restricted. and there was restrictions on lobbying, the stem this package, the so-called american recovery and reinvestment act. again, you'd only do it in writing. you could not do in person if you are a federal registered lobbyists. and there are restrictions if you're a federally registered lobbyists in the last two years and all these cases the last two years, from serving on commissions and advisory council, over a thousand of

them. and so for example, the department of defense may have a council that is looking into a new weapon system or evaluating an old weapon system, or maybe selecting a tanker for the air force, national case, people that were federal registered lobbyists. restrictions on those people serving on the. the lobbyists do not like this and you will see that people that come to speak to us don't like it. they think that it restricts certain amount of expertise and knowledge, that maybe there should be a judgment that's a little more subtle of a conflict of interest rather than just banning everybody. these are very controversial things that occur. there have been exceptions in terms of appointments of individuals as i mentioned, currently over 20 and his administration. and there is a procedure for doing that that makes those

decisions. the first one being assistant secretary in dod a few days after this came out. there was an exception for that, for that individual. so the question before us is the question that i started with. and the question that i want you to think about and we're going to discuss it, and we will run this like a quaker church. that if you don't say anything we are going to just sit here and tell you feel the movement to stand up, or express yourselves, about whether you think obama has changed washington. you know although but more about what he has done. has he changed the way of washington? which was yet again an issue in this campaign this last midterm election. people were upset with congress. they are upset with the way washington works. emily. [inaudible]

>> that was recorded not by an academic organizations but by "the wall street journal," and i followed up with it. they had accurate data on that. >> their definition of recent was less than two years what they meant by a recent lobbyis lobbyists. >> in some cases they moved from washington lobbying writing to the campaign. it's quite a typical thing. as we mentioned in this class before, people that are doing campaigns for individuals giving to campaigns for issues, and they get in, they come from a campaign for the president or individuals that are running for congress, and then they continue to lobby for the organization that they're working for. in fact, if you look at senator reid he had many people on the ground that were federal registered lobbyists helping doing the ground, the fieldwork, get out the vote and other sorts

of things in the campaign to do that. especially campaigns that effort competitive. it is a difficult thing, and i was surprised there weren't more people at a higher level in both of these campaigns. but i put it up because there was a promise by campaign and obama not to have federal registered lobbyists, or senior advocates. it's a little shade of gray in their campaigns. what do you think? have things changed? i know you've been in this business for a while. >> i don't think things have changed. i think it's something like we have talked about, lobbyists have this negative connotation in most parts of the country, and i think it's a nice thing to say that i think while it may have changed a lot in the white house and executive branch in general, nothing has changed. on hill nothing has changed.

a lot of the agencies, i mean, i think it's still the same. driving kind of like underground. >> so some people think the president did this for political reasons just to get elected, but, you know, he did it come he pushed for this kind of reform in illinois turkey pushed in the senate immediately got, maybe he was thinking about running for the president, but before he was leaving, he really believed that it needs to be changed. and so i think that's real. the question is hasn't really changed? it's sort of like a glacier on the side of mount rainier. it's going down in one direction, you can melt it a little bit but you're really not change the direction of it. we have the right to organize. the freedom of speech and a silly. we have the right to petition government, and this is all part of those rights, right? anyone want to take the case

that he has changed things? so you're all realists. you don't care what do you think iteeds to be changed? sam? [inaudible] >> most people do, i would imagine across the country. specs we have been changed by living within the beltway? >> no, but i mean every day that we brought it up a lot the past few days, but one man's advocate is another man's lobbyist. and that man's advocate is the other man's lobbyist. and so people are critical of lobbying unless it has to do with their own rights. gun rights, pro-choice, pro-life, boy scouts, church, whatever. all of these things have lobbyists, and so you are critical in the abstract, but when you get right down to it, he doesn't lobby, right?

they have a huge budget and 41 million people behind it. they do lobby and we're going to meet the chief lobbyist, and he is proud to be a lobbyist. but, you know, if your member of the aarp out in rural iowa or somewhere, don't mean to pick on iowa too much here, they don't think of it as a lobbying organization. yes, back here. [inaudible] >> perhaps like the wining and dining, those have changed, but the partisan nature, if you look at some the democratic lobbying firms, they have been here in 2009. >> they made a lot of money. >> a didn't do as well. so i think there is some favoritism still at play here. >> also when you have an act of congress go a very active congress, you have a stainless

package, the health care package, cap-and-trade, financial reform, it was a banner year for issues where people swarmed around and wanted to influence it. and, therefore, i think we will see the amount of federal registered lobbying money way up fishy. i think as with his 3.6. i think we'll probably be a lot more. let alone all the other stuff that is going on. yes? [inaudible] this would have been kind of a teaching moment, strategic the country all the positive aspect about lobbying, and i think what they touched on yesterday was the different roles that lobbyists play in terms of been like a translator for an interpreter or sometimes a spokesperson. and so sometimes lobbyist need to kind of teaching their clients about the rules of the game and the legislative process, and that's not a negative thing at all. that's just educating the public about these other positive things. so i think that's what the obama

administration hasn't sort of taken that approach to it, that they really made lobbyists villains even more so than beforehand. >> if you haven't are made up your mind about an issue, you sort of what you find out about the consequences of your action from either side. you want to bring in people who know a lot about the issue to tell you about it. and/or some senators, senator kennedy used to do all the time. he would bring into sides to asia to let them debate in front of each other. i always thought it was a good idea because they don't spin it as much, and so in any state legislature, the congress or city hall, you want to find out what are the consequences of this, and who expresses it best. citizens do but also people who know the policy do on either side. the theory of pluralism is that you always have competition on either side. sometimes you don't. sometimes it's one-sided, or

sometimes you 40 made up your mind and you don't want to listen to the other side. you are only listening to people you agree with if you're a public official, and i think that doesn't work well as a representative pluralistic democracy. [inaudible] >> there's a lot of expertise there and i think it's in the obama administration come he has backed himself into a corner, he hasn't been able to tap into the expertise because they serve as lobbyist. >> so it unintended consequence is that they are cutting off expertise. we will have speakers here. they may not tell you that would've been willing to work in the administration, not simply to advocate for who they represented, but because they know a lot about a particular topic and they want to go in and help out. that's good public servants. there is no restriction on that going into the congress.

and, in fact, we had a regular speaker here, gary, who is the vice president who is going into be the staff director of the energy of the energy and commerce committee, and they do with energy and commerce extensively, and that's okay. he knows a lot about the issues. but in the executive branch is being cut off to a certain extent. or people are not registering and they should register, just so they can be appointed. but even if you're a lobbyist before two years ago, you get somewhat tainted, i found out with some of my lobbyist friends, that even if you're a lobbyist five years ago you haven't registered for the last three or four years, the administration has not been willing even to look at those people. it's anecdotal but they are important also. john? [inaudible] >> lobbyists and advocates will

come up with more creative ways to get access and influence your i've been reading the past few days about these things called letter marked and unmarked. they will just go right to agents and bypass congress. >> tony podesta, john podesta's brother, tony podesta has his own firm, very successful firm and in the paper the other day, probably second from in terms of business volume. he was quoted as saying a couple months ago, he said look, you can pass all kinds of rules. you can take my license away, but i will find somebody to drive the car. that's your point, i think. but shouldn't we still try to have more transparency and enforcement? of existing rules, or just say let's don't restrict anything.

[inaudible] >> illuminate it from the ethics i'd. >> all departments have individuals to keep track of the time of the executives that they work for, they know exactly who they're meeting, if you run well. and members of congress, have you in your have worked in congress, maybe it had that job. .. saying and let's keep track of from the a ticket if branchlets publish it and have it out there every week, every month, whatever and

it was going to be too much of a burden. of course it would have to beng. passed by coi ngress.t, i don't think they would go wite it, but a part of the problem is within the body of congress, not bbyist with the body of lobbyists and s think that is behind you're hadh point., somebody had your head up. youep yes. r >> to keep questioning thed how pluralist democracy and how things work with that and why on president obamamight be changiny lobbyists are working now, he's not making institutional changes, he's making administration changes. >> through executive order, right. >> another two, maybe six years if he's lucky, and maybe longer than than depending on how that election goes. but i think most people are kind of waiting it out to see what ends up happening with a lot of these changes. >> executive orders can be overturned by the individual in office, by the next administration. executive orders continue into the next administration, we've got many of them, and your point is, well, maybe they're transient, people are sort of waiting it out until after 2012 to see what happens.

in preparation for this presentation, i called, and be i will not name the individual, but a person in the house of representatives that has the jurisdiction over any new rules for lobbyists in ethics, and it is not on the agenda, i was told, by the house republicans at this point. draining the swamp was with the expression in 2006. it helped the democrats. it was related to all the scandal which was primarily associated, primarily associated with republicans, and republicans, i think, do not want to visit that again. they want to move on to other kinds of procedural reforms out of the committee that has jurisdiction. right. >> do you think it's a question of revisiting or just kind of letting things go the way they've been under this administration? >> i don't think they'll have oversight hearings on this. i don't think they will push for new rules and regulations on the house side. i don't think the senate will do

it either. so the task force will come out very soon. we've approved this task force report, it will call for changing rules and making more transparent. but more importantly, enforce enforceing. we've not enforce bement really ever except through the foreign registration act and to call for more, call for the department of justice to have more resources to investigate this and to investigate people who should be lobbied, who should be lobbyists and aren't. but also we're suggesting dropping the threshold of who is a lobbyist because two contacts, 20% of your time, you can get out of that easily by being invited to see somebody. 20 % of what time, you know? that's a hard thing to calculate, and a lot of members -- a lot of people who are lobbyists saying well, you

know, i don't spend 20% of my time. and so we're refining that in the report. i cannot announce it at this point. it's not up to me to do so. but, yes. sam? >> well, my name's sam, i'm from minnesota, and i'm a little too young to be in any position of authority or knowing when jack abram off, you know, sort of ran the town -- >> he didn't run the town, by the way. he had some influence, yeah. >> but i'd be willing to met that members go to fewer basketball games, or if they do, they pay for the tickets. and a lot of sort of the perks that came along have probably been cut down pretty dramatically. >> there's been change there, right? >> in thatceps, you know, at the end of this lecture, i'll buy it, there's been some change. >> right. so there's been change in the form of gifts, gifts in the form of going to concerts, but also games. and also the trips are way, way down, and they're scrutinized by

the ethics committees very carefully, and you're given permission or not to go on a flight. but, you know, the big loophole is they campaign. you can still go on a jet to go out to a campaign event paid by the campaign or political action committee. you cannot have -- even then federal registered lobbyists cannot be on the flight, but you can do this. so lots of people in the leadership or associated with getting money for the party, campaign organizations are still using this mechanism for travel. and so there's some loopholes. but it's change in terms of everyone leaving on thursday afternoon on all these private jets out of dulles and national. yes. >> joe from new york. and while i do believe that obamas has maybe changed it a little bit, i think that this point becomes moot when considering the supreme court's

ruling in citizens united. because in theory a representative or a senator could be in debt to one organization or company who can now essentially funnel millions of dollars into that campaign, and even before he's recollected to office -- elected to office is already in debt to that company. >> so they can funnel money into organizations that can advocate for or against a federal candidate. they may not coordinate, i want to -- that's illegal. you cannot coordinate that activity with the candidate, nor with the party. that's, that's in the law. people have gotten in trouble for it, but they can still do it. and the joke is among campaign consultants, coordinate? all you have to do is watch television to see what's going on in terms of what the opposition is doing on the ads. and some of the most negative ads are coming from these organizations that are funded by anonymous sources, you know, like americans for freedom or something. i'm making up the name, i hope there's not an organization

named that. and you don't know where the money's coming from. so we had the disclose act that was attempting to disclose where the money's coming from post-supreme court decision, and it failed. in the, in the senate. passed the house, failed in the senate which would have required people to disclose where the money's coming from and list the ceos of the corporations that gave the money. and all of a sudden the ceos are saying, well, wait a minute. i don't want to be associated with my name on this particular ad. it would have been powerful. it would also limit and indicate, well, limit foreign contributions. there's a way to have foreign contributions now which is illegal, but if you run it through a u.s. subsidiary, they can run money into these ads at this point as interpreted so far. so, yeah, that particular citizens united versus fec

decision really undermined 75 years of law with respect to campaign finance and makes it easier for certain interests to have an influence. and that's your thesis, right? >> it is. just like obama said maybe messing with the pluralistic views which is kind of interesting because then be you look at the supreme court, in this theory, they're also blocking out maybe messages of the minority because, again in theory, a huge organization with lots of money can technically buy up all the commercial space. and those smaller maybe grassroots projects will not be heard. >> so the, you've heard this before, the criticism of our pluralism is the pluralist choir sings with an upper class accent. that people have more resources or more money. resources mean people, but more money have more influence than people who don't. is that right? do you agree with that, joe? >> that seems more true now,

yeah. >> seems reasonable. >> >> yeah. >> right. and sometimes there's no equal competition on either side of an issue, it's all dominated by one particular interest, and we know a lot of those cases. and other times it is pretty e call, and we have deadlock. so the conclusion is, yeah, fewer gifts, changed a little bit. i would say we have more transparency, but we still don't have the enforcement. if we had, if we had really rigorous enforcement, we'd really have a lot more transparency about what's going on. i think transparency's essential in a democracy, and i think that that was the intent of this reform. i covered some of that. but, you know, some of the unintended consequences are -- and i'm asserting this right now on deregistration -- we've had some deregistration. it's in the data i showed you, it's popped around 12,000, 14,000, back down to 12,000

federal registered lobbyists, but i think a lot of people who should register aren't. it restricts expertise as some of you have said, that's one of the consequences of this. expertise in the executive branch in terms of the revolving door in. it, it has brought more transparency, in my opinion, but that's related to enforcement. we need more enforcement. we've talked about a bunch of loopholes. one big loophole is that when a member of congress leaves the senate, he has two years restriction from lobbying or one year. in the house frequently the day after they leave, they leave and become the head of an association. they're not a federal registered lobbyist, they have 12 federal registered lobbyists in the association and a staff of 100. they set strategy and tactics for those people. they are allowed to go to the hill, go to the floor. it is exceedingly rare when a

former member goes to the floor and tries to lobby somebody. it just doesn't happen. that's enormous. they can go to the gym. you can't go to the gym or the floor if you're a registered lobbyist, you can if you're a former member. they call somebody, and they get invited in to help draft legislation or influence certain provisions of legislation immediately after they leave. so there's a big loophole that way with senior staff and also members in the house and the senate. why am i focusing on this? because i think in your plan you need to think about what the law is and what the norms and ethics are, and we're requiring you in your report to have a code of ethics. now, a good place to go is the american league of lobbyists. there's also a code of ethics for the american association of political consultants. it's referred to in an article that i wrote in the actual, in the appendix of the article the

actual codes are there. you can make up your own code. you can look at what the president has said about ethics in his executive order and be incorporate some of that. but we want you to have that. a strong element of this class is to come out of here knowing what is legal, but also what is ethical and what the norms are. do you have any final questions or comments before we have lunch? like, where do you go to lunch or -- [laughter] okay, thank you very much. good. police departments. [applause] [applause]

in that small school to a desk on the floor of the united states senate.

>> search for farewell speeches and hear from retiring senators on the c-span video library with every c-span program since 1987. more than 160,000 hours all online, all free. it's washington your way. now a look back to the year in books. we talk with the creator of the publishing industry news website self awareness about this year's top books and trends in publishing. this is an hour and a half. >> host: good evening and welcome to book tv live in primn time.r tonight we have three topic areas of discussion. number one, we are going to look back at some of the nonfiction books of 2010. number two, we want to review some of the changes in the public's and industry in the past year and number three, we are going to look ahead to some of the books coming out in early 2011. joining us live from seattle is

jenn risko of self awareness. she's a co-founder of this publishing industry newsletter and website. kristoff, jenn risko, what were some of the big selling nonfiction books of 2010? >> guest: certainly the biggest book of 2010 was decision planned by w. we are seeing sales on this one of 1.8 million copies and is only been out since the beginning of november. in addition to that we have seen to hundred thousand copies of it in ebook only so that is topping the list for sure. >> host: can a reason why decision points is topping the list? the president leftin with a very low approval rating. >> guest: he did, and it's interesting that this book would do so incredibly well. th in fact there's a number ofbook people in publishing that arewe. thinking that bush's book isr actually going to surpass the sales of clinton's book which is

an interesting thing to think about. why has it done so well? yo if you have watched bush on thil tour he's, pretty amazing. he's relaxed, he's having fun with it. he reveals to us many personal things and how he got to the decisions on his administration that shaped our country.stra he's just been an incredible job with it. t to watch bush being interviewed by marc zuckerberg at the headquarters of facebook was pretty amazing about peoplebergy incredible thing to embrace technology to get the word out there. >> host: jenn risko, there were several bush administration books including george w. bush's book of hours, then there was laura bush's, "spoken from the heart," condoleezza rice, extraordinary, ordinary people. karl rove also had one, courage and consequence.

any comments about those other books classics >> guest: i think what we can read about is a lot of people want to understand how that administration made the choices they did. it almost more importantly, you know, there's always going to be a bit of contrariness on. so if you got one set of folks in the white house, you want to understand the other side of things. so i think that's what we can read into it. plus, they're pretty compelling books. condoleezza rice's book of growing up in alabama. and you think karl rove has 600,000 in sales on that one, pretty huge. postcodes of condoleezza rice's book to pretty well? >> guest: at some numbers about 150,000, which is nice. i think there's a chance of the next one farmer might actually do a little bit better because that is drilling more into her time in the administration and that should be coming out in

about a year or so. >> host: right, i should just mention it otb either interviewed all of the authors of the bush administration memoirs or recovered an event with those authors. they are all available on our website at booktv can't work. if you go to the upper left-hand corner of our home page, you'll see a search function. type in the name of the author of part of the book title. it will pop up window be able to watch it online at your leisure. by the way, jenn risko will be with us for the next hour or so and we want to get your calls as well. what did you read in 2010? what comments you have about books achaemenid 2010? numbers are on the screen. "spoken from the heart" for those of you in the eastern sense to time zone. 202-737-0002 if you live in mountain pacific time zone. also, send us a tree. twitter.com/booktv is our twitter address. jenn risko, as a stick with

local books here to start, and other political memoir came out 30 years after u.s. president and mrs. jimmy carter's white house diary. and this is quite a thick book and very comprehensive, a day to day accounting of his life in the white house. do you know how this one did? >> guest: yeah, i saw the numbers were about 180,000, which is very nice. he did an incredible job to rain for the pope. in fact, just when i was sitting in the city, bob and the control room told me that jimmy carter sat in the sea. i was happy about that. he did an incredible job touring and at one point he got a stomach flu or something and landed in the hospital and is maybe 11 or two days. but otherwise he toured everywhere with us and he's such a charming, engaging, lovely guy. this diary is the first time the public has seen it in every day

of his administration he wrote in his diary. and as i mentioned before, you know, we'll think pitching is quite a bit of a poet, so it's a pleasure to read. >> host: when he did get sick and ended up in cleveland he missed his taping of afterwards that booktv and we had to reschedule for a month later. he just came a few weeks ago with historian doug brinkley and it's aired already and put tv. but again, and another one you can find on our website and watch at your leisure. it's one of our afterwards programs. in fact, he told us when he was here that date that his entire diary will be released at the jimmy carter liar free in atlanta next year, so that historians will have the chance to go through his entire diary. >> guest: this one is edited. so yeah. >> host: jenn risko, tony blair also put out his political memoir. >> guest: guess, he did. and he also missed a couple of

his book signings, but it wasn't because he had the stomach flu. it was because, you know, there was than protesting going on. we actually weren't releasing the numbers on this one, but when it did the us over in the u.k., that is sold close to 100,000 copies within the first four days on sale, which is a record breaker for a biography like that in the u.k. of course you have to think about the fact that there wasn't books around the time of margaret thatcher, so we don't have the numbers to compare in that. feels over there has been great. i yield the sales have been great, but no numbers on them. >> host: let's look at the top five nonfiction books for 2010, according to nielsen bookscan. number one, george w. bush as of december 19, 1.4 million. janine ross, women, food in god,

640,000 copies sold what is nielsen book and, jan? >> guest: neil finn bookscan takes data from rethink its 75% of the retail market. so every time you see the back, there is a on there. nielsen captures the skills of books at the point-of-sale moment and feed them into a database that we get to look at so we can see what everybody is selling of everybody else's boat. i mean, they started as a doing it for a record if you remember for sales of records and only moved into the book part of things. it only has about 75% of the market. i believe it does not include

sales from costco and djs and sam's club and also hudson news, which runs all the stores in the airport. >> host: well, for the top-selling nonfiction book, the number of weeks they appeared on "the new york times" bestseller list. here they are. malcolm gladwell if we could, malcolm gladwell. if he puts his name on it but today, is it going to be a bestseller? >> guest: the thing about malcolm gladwell is he would never do that actually. you know, it is so interesting how he came to write these books. he kept wondering why outliers, for example, one of 40 weeks on the times list, why people are so successful.

why is there? is it that they were carted to the rest of us? he really ties into well, no. in fact some of the hockey players from these teams happen to be a little bit older than everybody else and that might be why they score a few more goals than the rest of the kitties on the team. just a fascinating book. in my mind if he puts his name on it, will sell incredibly well? i think he did come out with a collection, a collective gathering of new yorker essays. and did they do as well as last in malcolm gladwell's? i don't think he did some of the two always do well because he's malcolm gladwell in his amazing. >> host: here's a look at 2010 nonfiction books and also a look ahead to 2011. >> host: here's a look at 2010 nonfiction books and also we look ahead to 2011. , 202-737-0002 for those of you in the mountain and pacific time

zones. fantasy tweet at twitter.com. we are obliged with jenn risko. i want to ask you about the second book on that list, jenn risko. kind of an odd story, raybestos collude. >> guest: what an amazing book, really. this is the story -- this is the immortal life of henrietta? this is a woman who in the early 50s, a black woman went to johns hopkins. she was deistic nosed with cervical cancer. unbeknownst to her some researchers in the lab to two times they pieces of her and put them into a lab and crew the first immortal cell that has ever been grown forever. and what has come out of this -- if you can imagine -- these are

called tequila cells. they are responsible for 80% of all the cells that are in laboratories today. how we find, you know, how we get different cures for different medication, for different ailments. these cells are everywhere. and it is the story of how they took the cells unbeknownst to henrietta for? and her story finding out about it 20 years later. it's this amazing moment in the book where sun -- sorry, her daughter, deborah goes and sees her mother's cells in an actual test tube in posted chica to this and that mommy, you're famous. it shows no one knows it. it's this billion-dollar industry growth out of this woman's cells and their daughter is looking at this test tube. and his daughter, deborah, can't even afford health care. i mean, think of the irony of

this. just an amazing, well-written story. quite the adventure. i believe it's just been optioned by hbo and oprah and alan ball, the guy who did six feet under as well is true but. we also just heard that oprah herself will be planned to daughter, deborah. it'll be an amazing adventure and this book will just keep on going. >> host: in fact, tv interviewed rebecca split in march at the virginia festival in charlottesville, virginia. this was before all the attention -- the full attention of the book came out. of course the cells are known that way. this book won awards everywhere and also found a notable list this year as well. it's one of her favorites of the year? >> guest: gas, one of my top three for sure.

an amazing book. >> host: what else is in your top three? >> guest: i would say once of other signs. >> host: isabel wilkerson. >> guest: isabel wilkerson was amazing. there were many nights i was supposed to be asleep, but a state of reading this lovely novel. and the other is cleopatra. >> host: both of which were covered by booktv this year. go to booktv.org. upper left-hand corner is the search engine, type in the author's name and the title. you can watch it online at your leisure. now, these are books that spent the most time at the top of "the new york times" bestseller list in 2010. number one, justin halpert, stuff my dad says. eleven weeks on "the new york

times" bestseller list as number one. john holloman and mark halpert, game change, seven weeks. michael lewis, big six weeks. george w. bush, number one for five weeks. i'm laura bush, number one for four weeks. she went on a pretty extensive book tour as well, didn't she? >> guest: she did. she did. her book has been out since may i believe. and bush's book has only been out since the second week of november i believe. so keep in mind some of these books have and how that went to go. "the immortal life of henrietta lacks" has been out for a few weeks. >> host: before we get the calls, let's talk about game change by john heilman and mark halpert. >> guest: i'm sorry, i'm not that familiar with that boat.

>> host: one of the political bios of barack obama in the campaign of she doesn't need. another one that came out about barack obama, and other biography was david remnick scum of the life and rise of rock obama. this also came out in 2010. greenwich, connecticut. good evening, u.n. put tv with jenn risko of self-awareness. go ahead with your question. >> caller: high, one of the game changers this year that everyone was talking about was e-book and how they were affecting the market. and a lot of authors say they don't be publishers anymore. they can just sell published books and use amazon and borders and barnes & noble online and to with publishing. so where do you think that's going? what does that mean? >> host: before you answer, and j. from connecticut, are you an >> caller: yes, i am.

what is given up his mass markets. i tend not to buy those. at rather by the electronic version and buy what i call a throwaway book. >> host: are you in the publishing industry? >> caller: im. i am a writer. >> host: your name? >> caller: my name is mj rose. >> host: what kind of books do you write? >> caller: i have her recent book, the reincarnation and the hypnotist. >> host: okay, thank you for calling and this evening. jenn risko. >> guest: what i would say about this is i think peter, you guys covered this extensively, the book matterhorn. so, there is a perfect example of why we still need publishers. this is a book that parmalat case wrote in 1977 after he served in vietnam.

at the time it was i think the first draft was a non-believable hundred pages. when he finally got it to a tiny, tiny nonprofit publisher in burbank california called leo but rarely are, he finally whittled it down to about 1000 pages. i believe the deal for his novel took in 30 years to write was that they would print 1200 copies and then they would pay him 120 books to sell as he wished. well, with this, i have to give myself, my company a little plug because the woman who is in charge of book reviews for us, marilyn tells got her hands on it. and when she told me she was going to read a 900 page book about vietnam i thought okay. and as well, cecily hensley at

barnes & noble got her hands on it and these two women champions this book and called work and intricate at globe atlantic. and the rest is history. it's gone on to be one of the fiction books of 2010. it is 180,000 copies and has been 150,000 electronic books. there's no way this would've happened without a publisher who knows booksellers, who knows the buyers, who can know the book reviewers and handed to them. i know it's special, but please read it anyway. it's an example of why -- why there was a lot of problems with the idea until it up online and if somebody wants to buy a copy they can printed up pod, you

know, so i think that's a classic story that illustrates why many public stories. carl marley tears was on the afterwards program. you can watch that online. another book about war, a national book award finalist emma john towers, cultures of work. someone else who has appeared on booktv. now, patti smith won the national book award this year for just kids. e.g. read it, jenn risko? >> guest: i did not read it and i have to tell you i'm sad that i haven't read it because it's totally my kind of book. i know that john mutter, our editor-in-chief read it and he said that he was just entranced. and i've spoken to the folks at atco a number of times. what a cool thing for patty smyth, write? just amazing. >> host: we have a tweet here that is related to the last caller's question. how will the rise of e-books -- it will give you a chance to

talk more generally about the industry. how the rise of e-books affect the future for editors, authors and book sellers and publishing overall? if you would come and take the e-mail and talk about the changes in 2010 and how it affected the industry. >> guest: there has been a lot of change. i was thinking recently another book that hit the times list was the sir palin book. an interesting thing about this was that last year when pearland came out with going rogue, they delayed harpercollins delayed the electronic book of days for three or four months because they didn't want to cannibalize the hardcover sales. this year they came out with the e-book and her new book at the exact same time. you know, we are showing numbers that electronic books are maybe 9% of the overall industry. how does it affect things?

is going to affect discreetly. but none of us believe that it's going to make the printed book go away. how it affects editors? i actually don't know how it would affect editors. i think that the biggest people that it could affect would be the booksellers actually. and i think that gaming the google e-book store is going to help them out a lot on that. so we're looking forward to seeing what happens. this is the wild west. people are still trying to understand how to market and sell electronic works and there's still some market confusion out there about different pricing for different works because of the different models. so we're still feeling our way around it if it, but certainly the technology is both has been embraced and i think that -- i mean, certainly e-books are getting a hair. i think the way it would

probably go, which is why the google e-book store is so pivotal is that we'll probably moving to more of a device agnostic environment. so, we will see what happens at that, which means you can read your e-book on your laptop and on your phone and on your typepad and everything else. and yet -- go ahead, sorry peter. >> host: i was going to say google e-book launched on december 6 and they've already had 3 million free books downloaded and hundreds of thousands -- they have 3 million books on site for free and hundreds of thousands of books for purchase and are readable on any browser as you mentioned. what is going to be the effective google into the bookmark it? >> guest: i think that -- you know, it's anybody's guess on this, really.

it's a whole new frontier. mica is again that if you buy a book like matterhorn, what i would like to see is you buy this 800 page book on the vietnam war and maybe you don't want to schlep it on the train that day. so what would be nice is to be able to read it on your phone or read it on your ipad or on what other device that is while you're on the train so you don't have to shut the book around. i think that if that's the way things are going to go and that's what we called abilene, where you buy, you know, you buy the book and pay a few dollars more and you get the e-book for free or something like that. that that the way the industry is going to be going, i think google is a front runner for the understanding what consumers want. >> host: when it comes to digital books, here is some information about some of the devices you can use to read him books.

kendall. kendall three has become amazons best-selling product ever. and while amazon does not divulge its numbers, and sources say that over 8 million kindle have been sold this year alone. that was reported by bloomberg. 8 million. >> guest: 8 million. >> host: that is a lot of kindle three. >> guest: that's a whole lot of kendall. you know, it's interesting. it is a best-selling product ever. you know, i always wonder little bit how we -- i think the numbers can be a little subject is, but 8 million is a time. something interesting to think about on that 8 million number, which is keep in mind that very few electronic or e-book reading devices are sold internationally i think there is -- you know, there's a lot of reasons to be wowed at the 8 million number

that purportedly amazon has done. you know, a lot of it is domestic. i think it would just be good for everybody to understand that most of that is right here in the united states. >> host: well, ipad. about 7.5 million ipad now been sold. it started at $499. and a barnes & noble milk. according to len riggio, about a million of those have been sold so far. how does the nook compared to the kindle. pasco we've heard higher reviews for the nook. fixing a lot more positive reviews for the nook in the kindle, especially because of the color aspect, that the nook has color and that the kindle