have protected rosa parks instead of arresting her that day. somebody with a badge should have made sure that she didn't go to jail, that her life, liberty and property life and liberty were protected that date. we failed in the law enforcement community to do that with rosa parks, and we need to make sure we are doing it today. >> and unfortunately it took sending federal troops, not state and local. i don't care what it does as long as the job gets done. >> and therein lies the fallacy in the tenth amendment argument, and that there were legions of state and local officials who refuse to act, and required -- list call me an old fashioned for nannystater that the federal government in almost every one of these instances in terms of expanding individual liberty or

cleaning the individual liberties and civil rights that we had it didn't happen at the state's local level. and i'd like to see where it has. >> he started while he was president and was in the federal government standing up. you think you need federal government to protect all of this and stop all this? i am for anybody stopping it, but it's the best -- thomas jefferson said of the best government is at local level and that's the local sheriff, local officers. it depended on the federal government you're going to be waiting a long time for that. >> thank you for your question. sir? >> i found the united states is like the old soviet union, the only country in the world that science virtually every human rights treaty there is but doesn't enforce it. the process by which the government is liable for the misconduct committing injuries to citizens as it pertains --

demint your question, sir? >> that's what i'm getting too. the new hampshire constitution states this and contact theory where if the government doesn't do its job, the contract which is the constitution is noel and void. on the states necessarily have both a right and a duty to secede or threatened secession if the government doesn't do what it's supposed to do as defining the constitution which it does all the time? >> first of all the united states is nothing like the soviet constitution of 1934. if you read the black book of communism published by harvard university press, written by the neoconservatives but by frenchman, the soviet system conservatively estimated 30 to 40 million people. so you are comparing the gadfly to an elephant. as for the issue of secession,

1865 settled that one. >> it was legal, good and we've benefited immensely from it. >> yes, sir. >> first, professor of think you spoken a little too grand about this father's, hamilton who is as great an authority on the constitution as a madison proposed the unitary state. >> okay. my question is and is a tenant -- my question is a tenant of legislation that a legislator drop a piece of legislation for each word in the proposed legislation have an equal meaning and apropos of the brady bill, mr. mack i'd like to know what your interpretation of the phrase well regulated in the second amendment means is

limited means well-trained and equipped >> [inaudible] >> it's talking about the militia and it's defined in the u.s. code section 10 is every able-bodied male 17 to 45. the militia was we the people so there's no contradiction there. is the - than or does it now? every citizen. every a bold -- >> so no. >> so yes. blacks were citizens, blacks our citizens now. it's dependent on the state. he's asking my opinion. >> whose opinion are you asking? >> i was asking your reference to the fact. >> okay. the militia is we the people and every citizen as part of the militia. with the states did about that?

>> let me offer a bill i read last week that defines the extreme to which the measures are being taken, it is a bill that is a concealed carry the bill, the right to carry coming into only have to establish -- you are qualified if you are not mentally incompetent and were not a film. so why ask the author of the bill how one would go about determining the process, and the process itself is certification. [laughter] and that's the bill that is written in the montana legislature. so it requires a mentally incompetent person to conclude that he's competent and then he can carry a gun to read this envisions a government so strained that it is no

government and it's particularly acute on guns. >> this is the state's rights issue and the gun rights issue is the next tomorrow i think. >> there is going to be a panel i believe it's on wednesday. >> it looks like three more questions. let's see if we can get to them before we have to leave. mr. mack or the one for me that represents a state or could see representing state why question is i feel the federal government has to step in where the states don't do what they need to do for the people. and with arizona would be willing to pass a health bill would take care of every person in the state, one of its comprehensive, that's the question. >> i hope not. arizona will lead that issue alone and -- put the question is

when the federal government refuses for political reasons to protect the borders as constitutionally designed and required, does the state of arizona have a right to protect itself? obama says we don't. >> thank you. >> thank you. gif sam? >> it seems we are not having the correct conversation. we are talking about the power, but we are not really talking about how to do with these issues we are calling them. things like state rights and for government you have on both sides, the ego power on both sides and the act the same way. >> do you have a question? >> when jefferson was or not there were not things called corporations that have international stature. so here's to regulate. how do you manage those? what is the proper approach to deal with situations which didn't accessed with the

constitution was sworn which isn't in people's minds that not exist so how would you handle something like that and we aren't talking about how to handle that, we are pointing fingers or we are taking power but not talking about it and that's the issue that's going to destroy it. >> i disagree with you from the beginning. we had a system that took into account ego and power. it's called the power the james madison federal paper number 47. if all men [inaudible] no government would be possible to read our system is designed as a way of regulating competing interests federalists can putting the ambition against the ambition because that is, according to the founders, the safest way to prevent anybody from achieving absolute power which to quote the acting corrupt absolutely. that principle is sound and how

we apply it to the specific circumstances of the 21st century and reasonable people and continue to disagree about that. suggested a different perspectives. [inaudible] >> i'm not hearing the part of the conversation. >> thank you. >> they're always going to be a conversation about the ego. >> we have three guys with pretty big egos of here. [laughter] >> how are we managing -- >> that is a corporation -- >> the federal government has allowed it. >> the states as well. you're right. the corporations are an american. >> my question is particularly -- >> can you speak up just a little bit? >> my question is for the

professor kaufman, once upon a time, there was a change in how the senators were elected, and because of that, has actually been a change in states' rights because once there was the legislature's who elective the senators and today it's done by the presidents. >> you are absolutely correct. i was at eight -- justice scalia made the same point that if you want to work of the watershed that altered the original allocation of power under the constitution, it was the amendment to give that indirect voting to the people to choose the center's senators because when the senators will be called in to the state legislatures they are more likely to take the interests of the state into account and there's a counter argument in the progressive tradition that it is much better to have direct elections, but in

terms of identifying probably the watershed event that shifted the balance toward the federal government, you are 100% right for citing the example, very perceptive. >> let me piggyback on that, a number that i know i cited in the past panels is at least a couple of years ago max baucus of montana who had the leading role in the health care negotiations received 13% of his funds for election campaign finance from the state of montana and the other 87% from people that have interest in the committee and the previous one was also correct and it seems like we actually have a fair amount of agreement here, but i think the largest problem facing this country right now is that at almost every level of

government except for a brave and courageous individuals, corporations are now in charge. [applause] >> if i could add one thing. i don't say this to be facetious, justice scalia never covered a session of the texas legislature. i'm not sure that i want them with the balance of power, but i don't know that the state legislators are the places that should be choosing the centers today. >> i'm so sorry that we are out of time. >> i'm trying to pull the threads of the panel together to see if i can find some common ground, and believe me, this is very challenging, but i think i might venture this much we would all be very happy if the sheriff's would protect the corporations -- [applause]

enjoy the conference on world >> good morning, everyone.

i am the designated federal officer for this committee. i want to make some brief housekeeping announcements. i want to welcome you all for being here. we will call to order. if you have the cell phones, please put them on silent or vibrate. before our committee members and catalyst, -- for at our committee members and palace, please make sure you were speaking in to the freestanding microphone and is flashing green. you signed and this morning and there should have been some comment, -- comment cards.

please feel free to give us back -- give them back to us before you leave. if you do not have a chance to make a comment during the public comment portion, it begins at 4:30. i'll turn it over to dr. tom hunter, the chairperson of the committee. >> thank you. i am going to begin by introducing the deputy secretary of the interior and he will give us [inaudible] >> thank you. thank you to all the views serving on this very important new committee. i want to thank you for your agreement to serve on this committee and to serve the department and the country. it is very appropriate, i

think, that our first meeting of the committee comes just short of the first-year anniversary of the deepwater horizon blow all disaster -- blowout disaster. there has been an enormous amount of attention on the safety of offshore drilling practices and appropriately so. we have had a searing experience with people out itself and its aftermath. i was the first administration official down in the gulf the morning after the blowout t, flying down that morning, on the phone with the command center. watching that night and the next day as a remotely operated vehicles -- new terms for america that we have become very

acquainted with. since then, as you know, we engaged in a vigorous and disciplined reforma agenda, and new safety rules have been put into place, new requirements for cementing inspections for certification, new management system requirements, a major reorganization and enforcement for a deepwater, new containment requirements. it is apparent throughout to that we need more and we need your help. help us define how to do more. the idea of this committee grew out of conversations that we had throughout the summer of 2010 with tom hunter, your chair, thad allen, and others. it became apparent as the struggle to get a deep water

horizon situation under control and as we dealt of the -- with the aftermath of this bill that offshore drilling, research and development had lagged in all phases from the drilling safety requirements themselves to a containment. and to oil spill response, where we watched skimmers and effectively dealing with the spill and scrambled to deal with a 21st century problem with the technology of the 20th, or a scene, the 19th century. the question that we talked about during many late nights was how we could we gather in one place the expertise needed to have this country lead when

it comes to offshore drilling safety? we should have a center of excellence where industry, as it moves forward with expertise, does not leave behind the academic community, the ngo community, our government. that is your basic charge, this advisory committee. how can you help us put together a center of excellence, something like the ocean energy safety institute, that will enable collaboration in real- time in these three important areas of drilling safety, containment, and of oil spill response? we need this, we have the opportunity to do this, and all of you have given your service to this effort to.

i will warn you, having served alongside tom hunter in a number of capacities, you'll be working hard. tom hunter does not lead moscow under his face -- maas grow under his feet. that is why we are also excited that this public process is now underway in. while we are proud of the reforms we have put in place, we note that more needs to be done and we look forward to your guidance as we move forward and the secretary will be here shortly after lunch to reinforce these messages. in the meantime, i look forward to the morning session and to his leadership. let me make one final comment. i want to thank some of the key folks who have helped put this together. including brad, whom you just heard from, it has been a huge

organizer of this entire effort to. with the full support of mike, tommy, melissa, and the entire team. i would also like to thank ray, who has been a leader for my in this effort. it was a tremendous effort to sift through the enormous numbers of nominations we received before the seeds around this table. congratulations to all of you are in d.c. it's because there was significant competition at. it was brad, brian, in particular, a porch with time to put this thing together. a special thanks to them. >> thank you, david. let me welcome everyone on the panel. [inaudible] those panelists who will be with us and will have a chance to

talk to us. i want to echo some of david's remarks. they worked very hard. i could not help but notice today that we're within a couple of days of the anniversary of the deepwater horizon. there is no question about the impact on the nation, an industry. it had a great impact on my life and my view of things. it really demonstrated something which i pondered about for a long time. the incredible and balance we have between -- imbalance between a secure energy and protecting the earth on which we live. i really think that is where a lot of the future may rest and i believe that it is important for

us -- and might not coming through, brad? ok, sorry. the impact that it had on all of us, the great reality, this question of balancing we did to preserve the environment. the world needs a lot of energy and somehow that seems to be unchangeable. the environment has taken a significant insults', one more insult -- income by this incident. we may not be able to survive once the get their. -- there. something about this event, it was an unthinkable and events. it seemed to be unstoppable and some days.

and it was unacceptable. i do not spend a lot of time on my introduction to. it was my privilege to serve the country as director of the national laboratories for the bulk of my career. this is the opportunity -- it left me with a lot of deep appreciation for the expertise in the industry and the government about this business of a deepwater drilling. it was a role that i needed to gain a deeper understanding and allowed me to meet some people and have an impact on where it does not coat it was a tragedy, catastrophe. it could have been avoided, it could have been contained earlier, and the gulf ecosystem could have been reduced. the role of this committee is to bring ideas and actions to

gather from industry, government, non-government organizations, and universities to make those could have been the reality. to make it so we really do avoid such incidents in the future and lessen the impact in any way that we possibly can. i am pleased that you have agreed to serve on this committee. it is a distinguished group. there was a lot of competition. it is one that has a diversity of views and perspectives and experiences that will allow us to accomplish a lot. there will be a lot of rules to follow and rabble keep a straight on all those rules at all times. we will come to know each other and our role and that will be a large part of what today's meeting is about. we will then try to seek a better understanding of where the upgrades in technology for deep water drilling really are today.

we will look for ways in which we can make recommendations about how to improve and enhance those. this morning, we have a series of speakers who will be bringing us up to speed on perspectives on what has occurred in the last year or so. we will have some questions to get to a common level of understanding on those events. it will be about scope and charter and where we will move the committee and we will also address what we just heard from david. we will address what is the most effective way in which government, industry, and universities can work together to pull the nation for? of late, but we would have to save the world come together, and how we can develop a much safer environment for energy production and the waters of the world. we will begin gathering such information and i would

encourage you to ask questions and to bring your experience and insight into those questions and try to participate in the discussion. it will be moderated, and it is my honor to introduce each of view, which i will do with the following method. i will ask you to introduce yourself. mike, we will make the last. we will start with a joke. we look -- we will start with joe. we would ask you to state something about your role, your current role professionally, and also to state something about your hopes and desires for the future of this committee. joe, we will begin with you. >> thank you. i have been in the oil and gas

industry for 17 years. i joined the oil and gas industry after finishing princeton university. my role currently is the manager of spluttered delivery. my role is in the fabrication of floaters that argues for production in the gulf of mexico. -- that are used for production in the gulf of mexico. my hope is that we work together to be able to achieve a safer and environmentally sensitive way of producing oil and gas from the u.s. waters. with that, i will pass it onto ted. >> i am the chairman of the university of texas in austin, texas. i worked as a civil engineer for about 30 years now. i started my career from shell

in houston. for the last 2.5 years, i've been teaching and traveling. my background is in applied mathematics and physics more than anything else. iowa work also on the intersection of energy supply systems and ecosystems and dynamics of sustainability of the human race. the results are not positive. my hope is that not only will we achieve progress here, but we will also manage to keep public interest in this extremely important area of intersection of the highest energy supply for humanity and also impact on the environmental systems. >> good morning.

i am the assistant minister of the u.s. epa. i spent many months with david dealing with the response, including many weeks and the gulf. -- in the gulf. we recognize that are prepared this was not as good as it should have done. a spill with significant impact on the livelihoods' of people. i met with many community members and i saw the consequences to date lives, both the direct -- the daily consequent on the long term consequent on the psychological consequences. my hope is that we remember the lesson learned. that we put into place a system that ethnologist and recognizes the severity -- acknowledges and

recognizes the severity of not being prepared as we should have been. so we can enable the state development of energy and consider the potential consequences if we do not have the systems in place. >> my name as paul, president of energy company. my hope is that this committee works to regain the public's trust, which is a license to operate and a straight in the deepwater. we have learned a lot from the incident. much work has already been done. the opportunity for this committee is -- for this committee is to build on that body of work. establish safe work procedures and cleanup response for the years to come. i thank you for the opportunity to serve, and i look forward to

serving. >> good morning. my name is richard sears. most recently, i served as the chief scientist to the national commission on the deep water rise in blowout and spill. prior to that, i had a 33-year career with a shell as a physicist and senior executive. i was responsible for shell's global exploration in deepwater and development activities. i brought that experience to the commission's work and hope to bring back this -- that experience also to the work of this committee. i look forward to extending the work that we did on the commission to understand the roots of this accident and also pulled into that the board that is going on with the investigations better still on going. >> good morning. my name is patrick reynolds.

in commanding officer of the coast guard marine safety center. it provides technical services to the post -- to the coast guard. i am obviously career coast guard. i am looking forward -- michael would be to improve the status quo with respect to drilling safety and environmental protection at. thank you. >> my name is walter and then the deputy director -- i have been with the bureau since 1988. what i am hoping for from this committee is that we have taken a lot of substantial steps to improve the safety of offshore operations. i think there is more to do and rather than just thinking of what we can do right now, i am looking forward to working with this committee to understand how we can organize ourselves strategically for the long term to stay out in front of the next

wave of new technologies and types of operations we will see in the future. >> my name is nancy and i am the director at mit in aerospace engineering at. my specialty is really more general system safety engineering. i've been doing this for about 30 years and i've worked in nearly every industry. at some point in my career. although there are differences in the problems in each industry and in the culture, my hope for the committee is that we will be able to implement some of the lessons learned from successes at in other industries in preventing accidents. >> i am charlie williams, i have been with a shell 39 years. i'm a chief scientist for while engineering and production technology. well engineering is what we call

drilling in shelby's days. -- in shell these days. i was vice president of hurricane recovery. i am also on the chair of the industry task group of four energy safety and containment. i am on the governing board of the marina will contain the company and the operating committee for the project. what i really look forward to and hope for is that we make a significant technical contribution to prevention in the industry, but also that we make a significant contribution to management systems and safety management systems and their contribution to prevention. thank you.

>> my name is stephen genzyme senior research scientist for the u.s. geological survey, wherever to over 20 years. of anabolic from research in the academic side. -- i am involved with research from the academic side. i was heavily involved in the response over the summer with thomas and others as part of the well integrity team. it was a very sobering experience and i hope we have to never lived through it again it. my hope is that we will identify what we do know and what we don't know about ideological barriers to containment of oil. identified a passport to answer those questions and we gained -- identify a path forward to answer those questions. >> good morning.

i have about 30 years in the industry. i was -- i was a civil engineer with shall. i work to do a number of assignments or iran did global engineering business that charlie talked about for the last couple of years. prior to taking the head of a global agency and sustainable development for shell, or i did that for a couple of years. i left and went to another company for a year. now i am with a global drilling contractor. in that role, i am responsible for the operations of those units around the world, and the construction of new units that were built in a number of places around the world. i will express my expectations for the committee, that we

improve the safety and effectiveness of our industry. i think we have the wherewithal around a table to help do that. my hope would be that it translates into greater access of offshore drilling around this country because it is a great energy supply for the country. thank you. >> my name is christopher smith and then the deputy assistant secretary for oil and natural gas at the u.s. department of energy. in that role, i am responsible for the oil and gas programs for -- programs. prior to this role, i started my career as an army officer and i spent about 11 years after that working for chevron in various roles. that was a combination of experience is that has given me

a real appreciation for the work, the difficult and dangerous work of producing our oil and gas resources offshore. in addition to the other cintas that a been expressed here, i hope we are able to provide that conclusion to help in short that the folks to do this important work are able to work safely and return to their families every day. thank you for the opportunity to serve. >> this group has enormous diversity of experience and insight to, but also shares a common purpose, as i listen to your comments going around the table. the nation calls on us to render the type of service -- someone may have asked why we are on tv and why we have the public from mark that we do. -- a framework that we do. the public of this country and

people all around the world are looking to this industry, to this government, to this committee to give confidence that we can proceed with the exploration are around the world. the record should note that we have this challenge, but we have a shared common intent. it is very important to think about the different sectors represented here. i am going to introduce michael, and i want to comment on that. for me, there was enormous experience about the first week in may and went into the entire summer and into september. you get to know people and you get to know how people think. when you talk to people at midnight and wonder what will happen at 6:00 in the morning, you reach conclusions about what

people intend to do and what -- what their intent r. mike represents an organization this people were dedicated at that time, and we will hear from some today. they are dedicated now, and in the aftermath is that they believe deeply their role the federal government has here can be fulfilled, one that allows for a responsible approach. also one that allows for proper oversight. this means we will spend time trying to encourage and support them, and i wanted to comment by way of introducing -- it is a good thing we do to provide support to all the people we represent. >> thank you, very much, and i want to thank you all for being

here today. people who are attending or watching know what we picked this group. we picked hunter because we are already 120 minutes ahead of schedule. that is extraordinarily unusual. right to our first session. we are fortunate have professor cherry murray from harvard university with here -- with us here today, who brings a background in a variety of fields. professor murray got her bachelor's and ph.d. from mit. she has spent a number of years working at the bell labs. she moved on to another one of our national labs where she rose

to the deputy director and then principal assistant director for science and technology. in july of 2009, she was named dean of the harvard school of engineering and applied science, as well as a professor of engineering and applied science and professor of physics. in addition to all those qualifications, she is a member of the national academy of sciences, national academy of engineering. she is a fellow of the american association for the advancement of science. with that background, why she is here is she served as one of the commissioners on the president's commission on the bp oil spill. she will share with us her observations and share the findings and recommendations of the national commission.

we are extremely fortunate to have professor murray hre. >> thank you, and good morning. i would like to express the appreciation of both of that commission co-chairs. the commission is now over. we have produced our report, which i will review with you. i am sure you have all read it. you also have two people on your committee who are intimately familiar with the commission and its report. we had seven members of the presidential commission that began in june. the report was finished in record time after six months. we could only do that because we

had such an incredible staff. we had 60 people on the staff, of which the chief scientist was rich. what the president asked the commission to do was to determine the root cause of the deepwater horizon disaster, to evaluate the cleanup responses, and this was being done in real time as tom and his group were trying to manage this, along with bp and some national lab folks. advise the president and the nation about future oil and gas exploration and production can take place responsibly, particularly in the more challenging deep water areas. we were not asked to assess legal, -- legal culpability,

reform energy policy, or duplicate other investigations. as you are aware, there were at least 10 and out 12 other investigations of this disaster. it was truly a disaster, not only did 11 people lose their lives, 17 badly injured, but the gulf has suffered a considerable ecological disaster as well as the loss of fisheries, tourism, and other economic impact. one of the first things we did as a commission is go to the gulf and spanned out and talk to the people compacted, and it was pretty sobering to see this in real time. we conducted a thorough investigation of the engineering

failures. we had a chief counsel -- we will hear from the deputy chief counsel, and there is a report of the chief counsel on the web site, as well as 21 staff papers. what you see on the screen behind most of the committee is the cover of the report, and this is also just a recommendation, which is also on the web site. i will not go through this entire thing, which would take way too long. but our major finding was that the deepwater horizon disaster was foreseeable and preventable. errors and misjudgments by three companies, beebe, halliburton, an transocean, played key roles in this tragedy, and government

regulation was not effected in preventing the disaster. offshore drilling is on to become even more complex and riskier. no one on the commission expects offshore drilling will cease at all. we need a u.s. source of oil and gas. we need to do this in a more safe and responsible manner. when we do not know that much about the geological and other conditions, it becomes very risky. we believe that it can be done safely. the commission recognizes that significant steps have been taken thus far by both governments, including michael bromwich, in reorganizing his organization, the mms, into i

will call it -- more needs to be done. we need more research in all areas related to explanation, the containment, and i hope this committee will oversee this research and suggest what needs to be done. the industry needs to develop a far better culture of safety. these recommendations are contained in the report. first off, there is a compelling need for a culture of safety. business as usual is not good enough. the north sea, norway and u.k., have better safety regimes, australia and canada are

revamping their safety regimes. industry, it is our belief that it is industry wide that this need for a culture of safety exists and that they should establish a private organization, which is not a lobbying organization, to develop, i doubt, and enforce standards of the lexus, to ensure continuous improvements in safety. as michael bromwich noted, i spent some years in the nuclear weapons regime, lawrence livermore national lab. the industry associations for

the nuclear power industry formed after three mile island a separate safety-oriented organization called npo, the institute for nuclear power operated is, that only the safety and -- that only the safety and safety inspections of nuclear power plants, which is quite effective peer review. peer pressure, the industry is at the cutting edge of technology, and the industry needs to focus a lot more on safety. one of the things i was quite if you look at, the r and d that the industry has put into deepwater drilling

, it is incredibly impressive. it is not that much different from going into space. however, if you look at the r and d that the industry has actually put into either safety or cleanup, it is less than 1% of the r and d that they have put into drilling. this needs to change. we do need to drill safely for both the people on the rigs, the people who are affected by ecological disasters, in our environment. we also need to cooperate internationally to ensure safety and prepared this around the world and to learn from international data. we do not currently collect the

data that would be useful for management of these spills. this is not a black-swan event. it is bigger than usual, but there were 79 other blowout and well-control issues in the gulf of mexico. it was not a loan company -- a lone company that has this problem, although some companies have a better safety culture than others. bell whole industry has to have a far better -- the whole industry has to have a far better process safety culture. so what we looked at his, as i was talking about improving the safety of offshore operations, safeguarding the environment, strengthening spill response planning and capacity, advancing

while containment capability, which is obviously, after this event, kind of important, and it was very clear that nobody knew how to do this and we had to invent things in real time. restoring the gulf of mexico. this has had enormous ecological impact for the last 50 years due to dredging and to oil and gas production, as well as this major event. ensuring financial responsibility of the companies who were drilling, and also looking at frontier areas in the arctic. so changing government -- we should be the most advanced in the world in drilling regulations and enforcement.

we currently are not. as i said earlier, the commission is quite impressed with the department of interior moving as quickly as possible to reorganize. they definitely need to develop a proactive risc-based proformance approach, similar to what what we call the safety case approach in the north sea. the international regulators forum is a good forum to express these new standards and revisions. and we suggested that the congress and the department of interior create an independent

agency within the department of interior which enforcement authority, to make that severna -- separate from the revenue generating agency. that has happened through the executive order. we also proposed that the council on environmental quality in the department of interior should revise and strengthen the nepa policies, practices, and procedures. we need to strengthen science and injured-agency consultations with noaa and usgs. we also suggested one thing that has not happened, witches -- which is if you look at the stable resources for regulatory oversight, they have not been there from the u.s. government. we suggest that similar to other

countries that industry fees support the regulatory agency and that environmental science is also supported by industry fees. it will be interesting to see what this committee says about that. the department of interior -- what we suggested is that some rulemaking is quite important and some prescriptive detailed plans and risk analysis be done as well as a safety case. as you can see by the graph, there are more and more

deepwater wells being drilled and altered-deep water drwells being drilled. it is not just the water that the issue here, but it is the geology of the deposits that are becoming quite challenging, and the risks are actually quite high. one of the things that we suggested is that the liability cap from the oil pollution act, which is $75 million, be lifted. that is way too low a cap. it is not incentivize the industry to prevent these kinds of things and to do the research and development. also, there is currently $1 billion limit to the oil spill fund.

clearly, as a result of this incident, $1 billion is not going to be sufficient, and we suggested that that be lifted as well. there is a considerable discussion going on about the six majors versus independent companies, and should independent companies be allowed -- be allowed to get insurance to do drilling in the gulf. we did not address what the liability cap should be, but that clearly $75 million is too little. containment and response. we had to invent the containment in real-time.

this is not good enough. as a result of this spill, the industry has come up with two different containment -- i will call them services -- that is certainly better, and the bureau of ocean and energy management has required that leases be given out. you cannot drill without having containment capability, which is a good first step. we were quite disappointed that spill response technology had not advanced since the exxon valdez. this is not sufficient. way more research and development needs to be done by the industry and supported by government on spill response,

and the spill response was really pretty minimal when you look at the oil that was actually collected. containment is critically important, and we -- and more research and development needs to be done on containment as well. government needs to have in- house containment expertise. one of the things we suggested is that, as was pretty apparent, the department of energy and the national labs does have expertise and should be brought to bear in the containment and risk response to such spills. in looking at restoration --

excuse me -- we suggested, as have several members of congress, using 80% of clean water act penalties to restore the gulf, that is some money that is going to be there and it is quite important. in the restoration of the gulf, science and the coastal marine -- excuse me -- planning is quite important.

and finally, that we ought to be extremely careful about the arctic, because we know that spill response and the coast guard cannot get to the arctic farewell, that is a thousand miles away from the beaufort sea, and cleanup is going to be considerably more difficult, and we do not know that much about the ecosystem and the life of the arctic, so we suggested that the arctic be developed, but more slowly, so that some research can go on. one of our commissioners is now named head of the arctic council.

i think what i will do, since i am coughing, is to stop there and allow you to ask questions. >> thank you, very much. we appreciate your presentation. we have time for questions. then be turned over to tom hunter to begin the questioning process, which will be limited to the members of this committee. >> thank you very much. i was struck by your comment about the nuclear industry, and if we think about the nuclear industry and you will note the government has the involvement has been extensive. there is npo, also another committee which is a bit of an analog to this committee.

we will see how that develops. commissioners, the have any insight into why -- let me comment that three mile island was the initiating event. do you see a parallel as rsx deepwater horizon being an initiator, and did you spend time on the understanding of what one industry is so heavily engaged by the federal government and the other one is not? >> we had a number of discussions about this. the oil and gas industry is a little bit more complex than the nuclear power industry in that they are on each of the deepwater raids -- let me say 20 contractors. it is always more difficult to have a safety regime with contractors who work for different companies.

nevertheless, that is also true in the north sea, and in the itself is, there r rig required to have this a case, not the operating company. this committee may want to look at that as a model. the people who live on the rig actually want to be safe. it is really important to have a safety regime that allows for things like whistle-blowers, and there was one argument that each well is completely different. they are not like nuclear power plants, about which there are about six technologies, and they're all pretty much the same. i would argue that it is true, each well is completely

different. it depends on geology, the design. there are best practices in well containment and shared best practices are really quite important. one of the things that happened with imho, as you are aware, is that about nine years into their for me, 100% of nuclear operators were members of this committee. each of them had to have insurance in order to operate, which is slightly different from the oil and gas industry. ors are the operati self-insured. the rate of insurance premium

was dependent on the mpo rating. there was quite a bit of -- n po had a few metaphors in the industry, because a different reading of good and excellent meant a huge amount of insurance premium that had to be paid. also, if npo does very serious inspections. they are nuclear needy people. they're pretty serious about it. it is an inspection that is about two weeks. i will say it is non-binding and it is not open. it is actually proprietary, and it is industry -- these people

go on inspections. it is industries learning from each other. there could be an analog for this for well controlled. npo does coordinate with the nuclear regulatory commission. npo does not set standards. nrc sets standards. if npo finds that a power company is not operating with the safety regime that it believes is important, it basically operates this confront of the entire industry -- it basically parades this in front of the entire industry. if the analog is the operators

of drilling platforms, there is some analogy that could be. >> thank you. >> that may encourage all the panel members to take this opportunity to learn more about the commission's results as low insight.'s own this may be one of our opportunities to engage the commission so directly. >> i am not quite as familiar asnpo, would you comment on the role you see going forward with the api which has set standards. he made a comment about the need to set a safety commission separate from the lobbying effort, which is directed at api. could you compare and contrast the role that api has.

>> the nuclear industry also has the nuclear industry industry association, which is an api- like body. it is a lobbying organization. it gets the industry together. it does actually look at safety standards and things, but it does not set the standards. the nuclear regulatory commission does. . api and a lot is nei, and that the oil and gas industry really does need something like npo. npo is nothing but safety. it does not lobby, it does not set standards. it just does industry to industry peer review of the safety regime of the power plants. >> the audience is having

trouble hearing. please make sure you have your microphone on. when you see the green flashing light, that is when you speak. identify yourself before you speak for the court reporter. >> nuclear industry is 20% of one-third of primary energy. the oil industry is 70%, roughly. nuclear industry has not built a new reactor since the late 1970's, while srigs being operated by -- while i am speaking to the. you have an order of difference of the size, and you have another order of magnitude of difference up the complexity. i would submit that controlling

and improving the oil industry is more difficult than the nuclear industry. having said that, in my mind, failure of human organizations was probably the biggest contributing factor to the accident. do you have suggestions to the oil industry that the beyond the npo-type activities? >> you are right that there is way more of our energy coming from oil and gas, not from the u. s, but imported. there are about 105 nuclear power plants now in the u.s. they were being built when npo

was around. i am not suggesting that all of the shallow water and relatively -- let me say -- less complex rigs also be part of this regime, but the more complex rigs be. when you look at that, there are hundreds of as opposed to thousands or tens of thousands, so it is not that much different in scope, but you are absolutely right -- and it is also true for nuclear power -- it is the human organization that was the root cause of this. it was human lack of judgment and also the fact that people who are contractors to the

operator could have felt a little bit anxious about bringing up safety. in fact, we know from the testimony that a number of people did not bring up the their issues with safety on the rig, and certainly, from my interaction in the national labs, our biggest safety issues were with contractors. i think that needs to be seriously thought about. how do you ensure that the team, which includes up to 20 different contractors on the rig, acts like a team? i think that this is doable. it may need training as a team.

this is actually what is done in the north sea. we have some examples. >> may i follow up on that, because you made a comment earlier and you were talking about the u.k. safety regime, and made a comment that the workers there want to be safe. that is the inference that the workers elsewhere to not want to be safe. the point is in cct case regime there is a identifying the hazards and identifying roles and responsibilities, make for a safer work environment. >> i certainly did not mean that people in the gulf of mexico did not want to be saved. in fact, they do. workers on the rig do indeed want to be safe, which is why there is an opportunity for doing a better case for all the

people on the rickeg, no matter which company they belong to. there is one difference that may or may not play a role in the north sea, and that is certainly in norwegian case, the workers are unionized, and the union has a big part of play in safety. i believe you can do training, roles and responsibilities, as an entity that is gone to be operating together for the next three months and that you can do a safety case. one of the things that we've learned, which i was quite surprised about, it kind of shocked me, is that bp and

transocean did not have a agreement on how they would do well control. this is not acceptable. well control is one of the most critical things. if you managed the well, then you do not have to worry about containment or spill cleanup or anything else. >> thank you for your comments. one question i have, the question i had is more related to the safety case in the u.k., norway, are backed up by guidancewhich are similar to the api standards. in your discussion, i value the

api standards. they have a lot of experience that they have built on, i have served on committees that have developed those standards. in your view from the commission, what is the way forward in that regard, because i do not think as an industry we cannot go down without having those standards as a -- in the form or another? >> i agree with those standards, and how those standards are determined -- just in the new clear case, the nuclear regulatory commission's defines what standards are. where it gets that from is obviously the operator. and some judgment. and someapi definitely -- i think api can propose standards and it is up to the bureau of ocean energy management to accept them and amend them and make them even stronger. they should be the owner of the standards. >> thank you for the

clarification. >> doctor murray, i was impressed by your comments, including the documentation. one thing that struck me, the people within the various subcontractors, had concerns that were not passed out to the decision makers. there were far rawls built between subcurrent -- between subcontractors. that would mean the rapid unfolding of events. people did not have time to react. if they had time, they may not have reacted differently. have you thought about other ways of training people on the rig floor react more rapidly to these sorts of incidents, maybe using simulators, something that gives people real experience in reacting to the signals they see. there is a human tendency to not

believe a disaster is unfolding below your feet, and there's something people might be able to recognize faster what was going on in terms of training for people actually working at the rig itself. >> that is a good point. one of the things that usually happens in a disaster like this is that it was right at the shift change between shifts. everyone was in a hurry. when that happens, you have ability to not make the right judgment calls. also, i actually think that training that team together is really important, not just individuals with a simulator. i do not know exactly -- and

this is something that api may be this committee can think about -- is there a better training exercise which has, here is what happened, what do you do? that would be extremely helpful to train the team on the rigs. the other thing i will put out his the-pressure test, which was obviously misinterpreted on the rig that night. it did not really -- there was no agreement as to how that negative protest would be done. this is something that obviously needs to get fixed. >> i have not read all the

report, and i was surprised to not see any mention of any kind of a real-time operational safety group or even a person that was consulted when these decisions were made. most industries have such a thing. when you have accidents, after challenger, after colombia, one of the things they found is those organizations had become silent and were never not consulted in the decision making. did i just missed something? was there something there? and it just was not mentioned? >> as far as i know, there was re were there accept their wor the people on shore who were in a situation where people did not know what to do should have been

contacted, but as far as we can tell, there was no contact of people on shore. whether the people on shore could have done anything, i do not know. but that is one possibility, when training whole crew on the rig, including all of the contractors, is that there is a 60 -- a safety committee that stands back and thinks about these decisions going forward. >> doctor murray, he made a comment that this was not a black-swan event, and referred to the number of events that the commission had observed when they were going through their investigation. in your discussion with industry brisbane's throughout the

process and the investigation, and looking at statements that are being made as we move to the one-year anniversary, do you have an opinion about the degree to which industry is dealing with this as a black-swan event or something that companies can take a close second look at do you have an opinion based on your experiences on how that is going? >> i certainly have an opinion, but i will not state it. the reason that the commission came down on the side of it is industry-wide, it is not just say one rogue company, is because it is quite clear from

our investigation, and you can hear this from sean grimsley later on this morning, that there were at least three companies who made really seriously bad calls in judgment. halliburton, who is the largest cementing company, and does this for everyone, went ahead and, despite the fact that there were three tests, went ahead and pumped the cement. quote bill riley when he asked the ceo of halliburton whether or not a burden on the pumps that cement for bp. i doubt it.

they were doing their job, but somehow the fact that the cement, the slurry, was known not to be good, and they did it anyway, was indicative of something that is not right about the industry. also, transocean and b.p. did not have as i said an agreement for how they did well control, which is, i will say, the most important thing to do while you are drilling a well. so, whose fault was that? i would say both of them. some companies do have a far better safety regime, but they still operate on rigs that are

leased and owned by other companies, and with a number of contractors, and do we know that they have a good safety case? i really don't think so. >> thank you. one of your comments, you said you did not feel like water that was driving curling risk, but you felt like killing risks right to increase in the future. could you say a few words around the commission's findings in that regard. >> what i meant by that is death means higher pressure, colder temperatures, -- depth means higher pressure, call whatever, and that makes it more complex. what makes it complex is the geology. it should not be water depth

that is relevant, but how complex is the geology of this well. there were serious worries o there were serious worries of blocked returns. on the part of the judgments that were made, were to mitigate those worries about the fracture of the formation on which it was why the mud was circulated slowly and things like that which if there was to nancy levenson's point of safety with all the decisions in the big picture they might have said that is okay for naught fracturing the formation but the cement will be probably full of mud and won't set very well and

so you ought to take that into consideration. there appeared to be at least to us each decision was taken one after the other and not a big picture of we have a serious issue here with all of these different issues in this well and what is the best decision to take, not just we fixed that one, let's go ahead and assume that work. >> thank you very much. >> you mentioned then there are a number of events that have occurred and if the need to do some risk analysis to understand the nature of the risk of offshore drilling. expand on that recommendation. >> one of the things we noted is

that in the gulf there are incidents that are not necessarily reported by companies unless there is a still of oil or gas. if there is a well controlled incident instead of saying we can learn from this, i won't say hidden but it is not brought forward as part of the database. and all people who are actually all industries who are actually seriously worried about safety look at what is actually happened and what are the precursors to a possible safety condition and not just look at -- not just looking at the incidents that were of a certain severity, and that is one of

thing that if there were an entity they could get into looking at these precursors way better than the agency can. >> i completely agree with you. dr. polio from our department has done a thorough analysis of the accident and found out that many of the accidents were not reported and he had to rely on oral communication of people who did or did not remember. also black swan, you mentioned several times and i'm like to be perhaps a little more specific. we're talking details of extreme value distributions which are

not very well understood by the insurance companies. would you suggest that perhaps a more formalized process of reporting and i hate to say that, perhaps to api or some other organization, also more thorough actuarial or specific analysis of these tales of extreme distribution also because we simply don't know and we make assumptions that are completely arbitrary. >> i do agree. reporting any loss of well control even if only for a minute use >> reporter: can help the industry learned how to deal with these events and also of course it will be helpful to have the statistics to no are we

doing better. >> we essentially had to derive the real-time monitoring with respect to the response. the most significant was dispersants and monitoring. do you have a view as to how we take those lessons learned and where we institutionalize it and who owns the execution of the more rigorous monitoring regime. >> he reminded me when i was going to say but didn't in my earlier talk which was the u.s. government needs to measure the amount of oil spills. just period. finally, after some amount of time, i will say a month, noaa

and usgs did a very good measurement of the oil that was spilling out. but i think it is really important to fears such a spill that some organization in the u.s. government, the national labs together with noah and usgs be deployed immediately to measure the amount of spillage. why is that? there is a conflict of interest with bp measuring how much oil is being spilled because they will pay penalties for the amount of oil being sold. assuming the responsible party is responsible for doing the measurements i think is a bad assumption. they will measure of course. they're also doing the nearedd.

a. assessment. there will be disputes about how much oil is there. if the u.s. government is prepared quickly to measure the oil spills we would not have these disputes. for real-time monitoring, one of the things that steve chu and tom hunter and the panel noted is that there really was no pressure gauge that was accurate on the blowout preventer. so you couldn't measure the pressure down hole or on the sea floor and that would have been awfully important. until the capping device was put on with pressure gauges nobody could tell whether the well was going to blow out into the formation or not.

that is kind of important. having better real-time monitoring is going to be a regulation that you need to have fuel time monitoring. for this kind of situation. >> any more questions? just a couple finis. we ask two panel members, david is from noaa. we had two panel members with less. david westhome is from noaa. i just want to comment -- from

cherry murray. my second assault will be on neckties. in this end the american public wants to understand whether moving forward particularly with deeper water and deeper wells is it a doable -- what is your first sense of that? >> my personal sense is it is doable. the u.s. government and the industry needs to make it more safe. is perfectly doable. i am very impressed with the technology that has been developed. in order to do the drilling more technology needs to be developed and some has, responding to the spill.

things like containment, skimming the, something needs to be done about -- need to be understood about our dispersants, are they good undersea? did they work? i don't think we know the answer to that. unfortunately we had this as an experiment to figure out whether that helped or not. >> let me turn it back over to you. >> let me thank you again for taking time to shares recommendations of the president's commission, in response to questions that the members of the committee asked. they tuned for being here. we will take at ten minute

break. thanks very much. [inaudible conversations] >> today on c-span president obama travels to virginia to hold a town hall meeting to discuss the u.s. federal debt. watch live coverage on c-span. today live on c-span turner enterprise's ceo ted turner and beat the capitals dot been pickens' talk about renewable and alternative energy live at 1:00 eastern on c-span. >> experience american history on c-span3, 48 hours of people

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spring meeting at the international monetary fund and world bank. this is almost an hour. >> speak to us for 15 or 20 minutes today. after which point he agreed to take questions from the audience. we are delighted to have you and turn things over to you. >> thank you for that very nice introduction. i should have around in the u.s.

more often. such a recognition. if it is an honor for me. thank you for the invitation. their meeting at a critical time. it is quite a significant -- never had before. it is important for the community of the region and perhaps for the whole world. the need to learn from the past about recent experiences and to shape and configure the relationship to fulfill the expectations and the needs of the two parties is more critical than it has ever been.

the u.s. and pakistan enjoyed a long relationship. it has been episodic and transactional at times and sometimes there has been a desire to make it on a sustained footing. one of the key features that has characterized this relationship is the variation. that it has seen. pakistan has sometimes been labored the most allied ally and other times the most fraction and allied. all of this in a period of years. right now in the post 9/11 scenario, a non nato ally. political security considerations have often led to

government tax journalist assistance on the economic front. and the growth spurt that pakistan has had, have somehow been linked to the u.s. external assistance or at least periods of external assistance from the u.s.. a key feature of this external from the u.s. has been cited with wars. in the first case the cold war and then the soviet afghan war and then the so-called terror war. in each case when the war has ended so has external assistance. this departure of the u.s. from the region has had tragic consequences. at least in the last case. now it seems we're entering a

new era tour we have entered a new era. the question we want to ask is why did the u.s. walkaway in the past and how can we learn to put this relationship on a more solid and sustained footing which it is not? subject and of vulnerable to shots. i think one of the answers the u.s. could find it easy to walk away is because the relationship was based primarily on non economic considerations. therefore this is one of the lessons we have to draw and this is an area we need to focus. our government appeared to have recognized this missing dimension.

and the relationship and they are trying to remedy that and we will see how it unfolds. the second point apart from this variation and the need to learn from parts of our engagement of the past is economic relations have always been there between the u.s. and pakistan. there has been significant interaction but it has never realized it's true and full list potential. in spite of that there is a significant degree of economic interaction that has been throughout and survived the vicissitudes of politics. trade for example is roughly $5 billion a year. fbi from the u.s. roughly half a

billion dollars on average. others are approaching 1.8 to $2 billion a year from the u.s. and government to government assistance now targeted at $1.5 billion for economic matters. so the second question we want to think about is how to seize the potential that exists and to build up on this economic degree. to a new plateau which realizes the potential and is true insulated. on the political and other fronts. let us turn to pakistan and see what is happening. first of all, democracy is back and it is back with all of its

vibrancy, lawyers and volume and dysfunction in and legislation. it is the period when the president and over our respect to the government and the federal government has voluntarily handed over responsibility and additional resources to the provinces. the dramatic development has been national finance commission award in which they're going to be transferred to the problems. and is what pakistani going to. education and health and drinking water. and law and order and

securities. the more resources we have, the more they will be able to respond. to the demands of the people. the service delivery could be improved. this could be a dramatic and far-reaching step and its consequences could be seen over time. has the aspect of the new democratic dispensation is we have institutions that are working for transparency and accountability the likes of which have never been seen before. in the first parliamentary history anywhere the chief accountability officer of the government of pakistan is a person who is the leader of the

opposition. the leader of the opposition in the parliament is the chairman of the public accounts committee which is the chief accountability organization of the government so you have this wonderful experience of the leader of the opposition in a position for someone anybody asking any questions from anybody and demand explanation from anybody from the prime minister down to everyone and he does that. you also have a supreme court for the chief justice and the court is highly active in scrutinizing in investigating and asking all sorts of questions from everybody in the government. this is an exciting development and makes our society open.

we are also free media and it is fair and totally free to comment and critique and question and criticize. which from 7:00 p.m. to 11:00 p.m. have doc tours which do little to focus on public issues and perform their job with enthusiasm. turning to the economic matters this government inherited a difficult situation with economy at the verge of collapse but a lot of steps have been done to restore macroeconomic stability. try to mobilize taxation and cut

down expenditures. even in this most recent budget, expenditures were frozen which means reduction of 10% to 12%, new taxes have been levied on capital gains and stockbrokers, new sectors have been brought in, fertilizer the griddle pesticides and tractors and others which were excluded before 700,000 new people with multiple bank accounts and international travel with the best addresses of pakistan being pursued to broaden the income-tax and so you have a new drive and a new initiative and the goal is to raise the low tax to gdp ratio. it is closer to 14% over the

next four years. at the same time, including passing energy prices and international rise in oil prices to the consumers, there has been a conscious attempt to have a social safety net. did not forget the already forgotten and try to reach out to the poorest of the tour. or automated systems of cash transfers. this is a system that even the word bank accepted as one of the best managed in the world. so accommodation of balance is being struck between looking after the very poor during the transaction which is going on with the most difficult

decisions and political environment that is not very conducive which remains franchised. on top of this pakistan has had multiple challenges to place. we have a continuing expenditure, soldiers sacrifice their lives, they have been targeted and and the exchequer had to bear a great burden. this is a war into which we are committed and in the middle of a war you cannot start your soldiers so the fight has to go on and the money has to be paid. second we had the greatest disaster of our history because of the great floods of 2010 when twenty million people were affected, crops were destroyed, infrastructure with damaged,

lives were shattered, $10 billion of damage occurred in two percentage points from growth rate of gdp wiped out. we now have to struggle and that exposure to rising prices of oil which we targeted at $70 better than the budget meeting with the officers under 20 and it is likely to remain above 100. in spite of that, the government and the people have shown we have continued to pursue economic reform agenda trying to focus on public sector efficiency, even the cabinet has been cut by two thirds. our government budget for development programs or government project was cut from $280 billion by $100 billion to 180 so the idea is to ensure the

security of public finances to maintain fiscal discipline, bring down deficits which when the government came into power was above the 7.5% to are around 5% to 5% to try to create a platform for growth so we have been working on a growth strategy to give jobs to young people and give back growth approaching 6% or so. some of the results are beginning to show and i am happy to show those on the external front exports which have shown dramatic increase of 36% in the last 29 months if you compare february with february of last year, growth is a phenomenal 46% and exports are likely to cross

$24 billion, the highest ever. similarly approaching $1 billion a month unlikely to cross $11 billion this year at the highest ever. the benefits high of these two is shown in the reserves of foreign exchange which also reached the highest ever levels of $16 billion. .. at the same time, we rationalized our government program, and we feel that the combination of all these must be shared, the merging benefits in the economy must be shared with the large segments of the people, and government has adopted pricing policies for agriculture sector to insent vise them to grow -- insent vice them to grow more from the commodity boom and share in the global prosperity emerges from the rise in the price of food products, and this is being off. we are expected now to have a

>> we are expected now to have a bumper wheat crop, the highest ever, and because the pricing is geared in such a way, this will lead to large-scale prosperityin in the countryside. so these are some of the emerging, emerging areas of positive results, and in my last set of comments to u.s./pakistan economic relations, i believecas because there is a reformist government in pakistan, aat democratic government that is not burdened with trying to do funny things to achieve legitimacy, and we have a global conflagration in which the cou destinies of the two country appear to be tied for some time and, hopefully, for a longer time that a new way of thinking about how to secure thes of

foundations of this relationship is, indeed, the responsibility of leadership of the two sides. i think the u.s. government has responded or tried to respond tn this challenge s and a new external existence law has been passed, the kerry-lugar-berman which attempts to give $1.5 billion every year. this in reality, the dispersed amounts are less, but i think a institutional arrangement exists under which the two countries n be worked out. five areas have been laid out for a special focus.ra these are energy security, food security, economic growth, particular focus on the affected areas and the tribal region and social sector including education and health.

i believe that if money is dispersed and if it's widely used, this can have far-reaching consequences. at the same time, given the demands and the requirements of the country and the potential that exists in the private sector and the lesson from the past of not relying upon governments alone, very important to think of platforms for business-to-businessess dialogue and for ventures in which u.s. businesses can makevt money so that they remain motivated and participate in the economic development of our country while also benefiting the shareholders. so several opportunities exist,e one of which, of course, the kerry-lugar-berman is it trying to develop, and that is the idea of pakistan/american enterprise fund which would be of $900

million. -- $300 million.it it's under the process of legislation, and we are optimistic that once that's passed, it will be a bank from which the u.s. businesses can draw, and it can be leveraged te do larger projects. and it will be, potentially, aon magnet for attracting some kind of investors to pack stab. pakistan. finish about pakistan infor general, it is a country with tremendous opportunities. sometimes i'm asked which are the sectors that people should focus on, and my answer is thatg government ministers are mar -- particularly inept at answeringi such questions because if i knew which sectors, i would be in thi business myself. c but i think whatan i can say is that everywhere -- and i've had the opportunity to work in twoe dozen countries, and i think the student of development

opportunities in pakistan are second to none compared to all the 24 countries that i have worked in. the opportunities in agriculture and in services and invice telecommunications and in energy and in mining and in oil and gas in particular. ev and everywhere you look you will see opportunities. the question is, is there a liberal investment regime that allows people to come and participate? on that score let me share with you the nature of the pakistani investment regime. i believe it's the most liberal or one of the most liberal in the entire world. we do not discriminate against w foreigners. foreigners are welcome.ate in any sector of the economy. they can participate 1% ofr equity or 100% of the equity. there's no requirement for any a local partner like in some in countries. there are no limits on how much

capital you can bring in or take out. there are no limits on how much money you can repatriate in the form of dividends, of profits or licenses or whatever. o so here is an environment which is very conducive, verye, v welcoming, and the government is beginning another, hopefully, exciting program of privatization in which government assets in electricity and in oil and gas and manufacturing will be available. and i think, above all, what one needs to do is instead of listening to the speeches of ministers is to talk to your own colleagues who are already there. the american business association of pakistan, you cau talk to them. of most of them are already th expanding in the last two to three years.

i was telling it has been the best for most of them, and they will share this information with you. keep pakistan as a secret for themselves, then, of course, you can always look at their books.thei they're available.they and they will corroborate the story.e, so i think i will stop now and,k hopefully, we can have interactive discussion. to i'd like to learn from you. let me, also, in closing appreciate the u.s. government and its leadership for the focus that they're giving to pakistan, for the recognition of the strategic nature of our relationship and the benefits that will accrue to the world if we invest into this relationshin and recognize each other's strengths and each other's capacities to contribute.

and the fact that we have cer initiated a strategic dialogue between our two countries to which pakistan responded which covers a large set of areas i including security and defense and energy and economy and trade and so on. and, also, i want to end by thanking the u.s. government foe the support they gave us,ase particularly the initial phase of our floods and rescue and relief operations. and for being a part of the t international coalition through the united nations network in supporting our suffering brothers and sisters and also for the support they've extended to us in trying to help us at other multilateral settings.etti thank you very much.k [applause] y

>> well, thank you, mr. minister for, but also very encouraging remarks and fact. your optimism and confidence is very striking and all the more so because it flies in the face i think of the conventional wisdom. maybe i'm talking to the wrong people, but when i read the pakistani press, when i talk to pakistani trends, when i talk to people in this town who follow pakistan closely, they don't seem to have nearly the optimism and the confidence you do, and i'd like to get your views as to why that is? how do you explain the gap as it were between what you say is the

real situation to the general perception that things are not going particularly well and perhaps we're going in the wrong direction. is this simply a question of the right information not getting out, or is something else at work here? >> well, that's a good question, and i, myself, think about it a lot because your observation about negative perception in certain segments of our people i think are well founded, and we have to obviously take some blame for the failure to communicate our point as effectively as one can. at the same time, i believe when you live in an area with -- where you have so much capacity

of other areas to get their points of view, and when expectations are running so high and you have a situation of a coalition government, and you have within your own country a free press which i think is just beginning to find the rules of the game which are not developed i think at the moment. somebody asked me how do you feel like getting your point of view across, and how do you feel -- and i said it's like if you're in the democratic party in the u.s., you have another republican party to deal with, and you have i think one general to deal with, but if you're a democratic party or any part ruling in pakistan, you have maybe five republican parties to

deal with and 16 fox channels to deal with, and, of course, it is daunting to get your point of view across in that situation, so i don't know. i have tried to state some things which are facts, and, of course, one can try to get that narrative across, and i would say also in the u.s. that we have the question of public lack of trust or trust deficit, and i think sometimes when we talk op this issue with the u.s. counterparts within the strategic dialogue and public diplomacy, both sides are dim to figure it out because we also pose this question to the u.s. that why is it if you have good

intentions and why is it if you're trying to support our country, that there is -- that the point of view doesn't get across? why is there a trust deficit? so i think this is a question that needs greater scrutiny by people you know who are experts in this issue. i think within the u.s., obviously, there are all sorts of interest and all sorts of point of view, and there are two or three things that somehow are against us. one is, of course, there's a perception that a lot of money is going to pakistan. at a time when there is requirement for fiscal restraint and, you know, expenditure cutting at home, so there we have to come out and explain the

facts. i think it's largely a myth that pakistan is a beneficiary of these tens of billions of dollars. the truth is that in the kerry-lugar arrangement this year, we have not even received $300 million, so but when people go to the hill and talk about tens of billions of dollars, and you have public representatives, nay naturally have -- they naturally have to think about it, and i think foreign assistance never has a strong lobby, so we don't want to think of pakistan as a country that is primarily attempting to simply get foreign assistance. no, sir. we are saying let us have trade. we are saying let us open our

narcotics to each -- markets to each other so we can give arrangement where the american businesses can flourish in pakistan, and our pakistani businesses can flourish here and it's good for everybody. this was our approach with the european union, and i'm happy to tell you we have succeeded in opening new areas with the european union for trade because this is the message we want to give is that if we are to have lasting relationships, and if we are to break some stereotypes, then it is important that we focus on trade, but if there are barriers to trade, then obviously, they have to be tackleed, and so, yes, i think a lot of work needs to be done, by both sides, by friend of both sides within their countries, to try and get this view across,

especially in this country there's a perception as if we are asymmetrically dependent on the u.s. whereas what we want to get across which, of course, we as a signal third world -- small third world country have difficulty getting across in a place like this, but part of the reason i'm here is precisely to do it in my own small way and to get, you know, the benefit of people like yourself to subsequently take the message to a larger audience in a more effective way than i can. >> well, thank you. we'll now turn to the audience. let me remind our audience that he is the minister for finance revenue and statistics. i expect some of us would be

delighted to ask questions on a variety of other issues, but i think to be fair to our guest and given particularly our limited amount of time, i would request that you direct your questions to the minister in the areas for which he's responsible. dennis will ask you first. i'll ask you to wait until we get a microphone to you to identify yourself and to keep your remarks very short. >> thank you very much, mr. minister, for the very upbeat appraisal of the situation. i had two questions, not entirely related. the first, you spoke about the prospects for business, american business in pakistan, investment, ect.. i wonder -- i think that one of the hold ups has been the lack of an investment treaty, and my impression was when this was

negotiated or the effort was made and negotiated i think during president bush's visit that the hold up was on the pakistani side, and i wonder if you could fill us in where that sits today. the second question, another area to evolution. a very, very sweeping change, lots of new responsibilities to the provinces. i'm wondering about the financial side. do the provinces have the basis for paying for these new opportunities or these new functions, and particular, i was wondering about -- i think it's part of the evolution, the pact that the provinces now will have the right to borrow money. thank you. >> yes. i think excellent questions. first of all, i'll share with you my own humble view about the

role of these business treaties in promoting investment. my own view, and i could be wrong, is that the role of having a business investment treaty between two countries and generally promoting investment between two countries is usually not so great. of course, it might provide certain extra safeguards to e leaveuate some -- alleviate some risks of concerns, but we have a thriving, you know, and historically tested achievement of so many u.s. companies that it's not a new terrain where you are going. second, the last discussion we had on this business up vestment -- investment treatly which probably has been a really good exercise for lawyers on both sides is that the u.s. was

coming up with the new template for rntion you know, future business investment treaties, and once the template was ready, then the discussions could restart so this is my understanding over things from last time, but if anybody in the room has more up-to-date information, i think we can all be enlightened by it. the second point about the evolution, it's very important to recognize that the devra evolution is going on both on the administration side and on the resources side, in fact, it's more drastic on the resources side. eighteen ministryies that's now

been decided to get rid of this overlap and have excessive government that they should be solely the domain of the prosinces. on the finance side, previously, we have a divisible pool of the taxes raised, and out of that, previously, 45% used to go to the provinces, and 55% would go to the federation, and now 60% would go to the provinces, and about 40% would go to the center , so this is a very dramatic shift, and as i said, it's about 300-400 extra rupis and this poses another problem on the government because they are responsible for debt servicing of the past, responsible for

expenditures, and of course, running civilian p government at the center. on your question whether they can borrow, provinces have always been able to borrow from international agencies, but that borrowing is done in coordination with the federal government because only they are the sovereign and only they can borrow through an arrangement with the federal government because they are the risk related to the foreign exchange. yes, yes. >> we'll get you in a minute. all the way in the back. i think that's polly, but i can't see because of the lights. >> yes. i do have a question about kerry-lugar-berman, and i was

wondering if i understood you to imply that it is not essential for pakistan to have it. can you clarify that? i have another question which is if you feel that kerry-lugar-berman is still a good idea, where would you from your vantage point particularly like to see those moneys go? what would be from a pakistani perspective the best outcome? >> okay. well, first of all, i believe it's very important for pakistani-u.s. relationship. second, i believe it's very important as a symbol of the u.s. government, and it's congress' commitment to a new democratic government in pakistan, and three, i think that if it is dispersed in a

proper way and con figured in a proper way and implemented in a proper way, then it can have far reaching consequences for the people of pakistan, and, you know, altering some of the misperceptions that are there, but, of course, in the larger skean of things -- scheme of things, one has to see what larger impact of that magnitude can have. in my view, i think, i have sat down with u.s. officials, with the u.s.-aid administer, the representatives of pakistan, and pakistan-afghanistan special envoy, holbrooke was a great friend of pakistan and great loss for us, and we determined these five areas which was energy security, food security,

infrastructure, development, and the affected areas, private sector growth that includes this sector fund, and social sector, and i think the amounts were also dedicateed and for the five years and precise amounts to specific projects for the first two years, so i think it's a promising program and no way do i want to appear dismissive of it or not thankful for it. >> okay. down here in the front. >> i'm with the pakistani leader center. i think at a certain point we have to go beyond this statement of we need trade from, you know, market access from the u.s. and pakistan. i mean, as the pakistan american

community, we've been working on some of these things, and there has to be recognition that one of the largest exports to the u.s. is textiles. at the same time, there's a textile industry that's very hyperprotective of any pakistani products. there needs to be cooperation between both of our sides to figure out what specific items we can have those negotiations on and get that market access for. my second question has to do with -- obviously, right now we have this environment coming up where congress is looking to pass some of these fta's whether the u.s.-colombia free trade agreement where there's an opportunity for the market aspect to get bundled. the second question is on, you know, when we have things like the u.s. pakistan enterprise fund, questions come in like why do we need this government fund

investing in pakistan that's overseen? part of that is you see very smooth pathways for u.s. businesses to go into india which is next door so i think a lot of that comparative, you know, analyzing is going on when u.s. is looking to base, you know, where are we basing our manufacturing facilities? i know you said you were in a position to describe what pakistan's competitive advantage was, but talk about what things pakistan can do to facilitate u.s. businesses whether that's a communication strategy of how pakistan is a good investment destination or business delegations because there's the convening power of government where we can facilitate these private sector missions to pakistan. if you can talk about those efforts. thank you. >> mr. minister, this is a savvy audience. everybody taking advantage of the microphone to ask two questions. .

>> yes. [laughter] >> should i just selectively pick one of them? [laughter] again, i think you are right that in the end what we want or what the two parties may want is the upper bound that comes from the political constraints so clearly we have to desire and we have to strive for a trade regime that is as open as possible, but at the same time, we have to recognize that we may not succeed or we may nod succeed entirely because of the considerations and that's a fact of life, so you are absolutely correct in saying that you don't want to bang your head against a brick wall, but sometimes if you try hard enough, a way is found, and your other point about i think the regime one to which

-- general one which only i can agree to is you have to do many things to achieve the goal of trade promotion whether it's delegations and fairs and so on about fda's ambitious goal, and although we have talked about it with our colleagues in the u.s., it's a long multiyear process, and here we are trying to at least get the business investment treaty done which in many cases is a prelude to, you know, the thinking of the fda, so i think we have a bit to go there, but that should be the goal for us. >> we are running out of time, i ask people to restrict themselves to one question now. this gentleman and then you. >> i have a question on taxation and collecting of taxes.

the pakistan business counsel in its recent national business agenda called on the pakistani government to both diversify its tax space and improve collection. i'd like to hear your views on how to go about doing this? >> oh, yeah, i think this is a hard topic in afghanistan, and if you see the recent measures the government has taken have been precisely in this direction. first, there has been a massive amount of time spent in political dialogue and not just with politicians and political parties, but also with the stake holders including the pakistan business counsel. i organized a meeting with the president. we spoke to them before, and they worked their voice behind us, so we are grateful to them. those emerging coalition which is saying, look, these are areas we can want ignore anymore, and we need to focus on them.

as we said, we already have taken in the last few weeks steps to bring in totally new sectors that were outside the net including textile which was the most powerful sector in afghanistan, always resisted being taxed, and now they have been taxed. fertilizer, they have been taxed. sports groups, surgical goods, pesticides, tractors, and in addition to that, there's thousands of products that are really in the general sales tax that are in the system. we imposed a new tax on capital gains again, an entirely new sector. income tax, there's discussion on that. i want to say that we are committed to improving the tax system which is in the provincial governments so we are having a dialogue with the provincial governments, and we're trying to raise the bar

for them that either you improve the tax collection on agriculture, and we have to think in terms of other mechanisms for -- because nobody can escape taxes. as i said, we have identified 700,000 people, we are going after them, the chairman of the revenue service is here. he's having dialogue with the ims and others sharing these experiences. we identified 4,000 of the most important pakistani funds, many of them among the most important evading taxes and the tax revenue services came to me saying what can we do? theirself the most parrel -- they're the most powerful. i said prosecute them all, and so that very day cases were registered against all 4,000 of those companies. they evaded 7.6 billion roon

pis. the chairman made hundreds of changes in the top leadership, and i think all pressures are being resisted to try professionalism, avoid political interference, but these things take time. if you are running, you know, a marathon and you can't judge a performance by the first ten steps, we feel like, i think, this is a process that has to take some time. people talk of all these, you know, leaders who transform their countries, but the success was achieved in the 10th or 15th year. i'm not saying we should take that long, but let's at least wait 10 or 15 months after these changes have been made and so on. >> gentleman here.

>> i'm consul at that particular time to the world -- consultant to the world bank. mr. minister, congratulations, fantastic presentation. thank you very much. quick question regarding the energy sector. you spoke about it. it's electricity and the shortages, and can you just say a few words about what the policy is to attract more investment in that sector and the problems of the shortages in electricity. thank you. >> okay. the problem for the shortages is because of multiple reasons; right? we can decompos this into three types of issues. number one is that government has not had the money in the past to pay every single producer of electricity according to their demands, and that has created what is called

the circular debt problem, okay? now, a seemless effort has been made, and a new bill created to park the circular debt separately so this distortion is minimized, okay? this amount of 300 billion was separated, and i think an effort was made to subject transparency into this and minimize this distortion. okay? second is the question of the subsidy regime or the pricing regime. government, i think, has taken extraordinary bold decisions in passing on the previously suppressed prices of electricity to the consumers, and the prices of electricity have been raised more than 60% in the last two years, and even now for a political government, thews pretty heroic, and even now 2% more a month they are being increased. in terms of other efforts of

management, all the government companies or like 12 or 13 distribution companies and some other related companies, the board of directors have been totally changed, and the people who have been put there are all professionals, all people you could recognize and think they are good people, that they will stand up to political interference, that they are knowledgeable, that they will scrutinize the management's performance from one angle. how are they performing in terms of professional conduct and commercial considerations? i think the getting and a lot of old plants, they are being renovated, and as far as investment policies, i think that's a system that has historically enjoyed a great deal of international investment participation and it remains true even now.

if any, it's acquired a greater urgency so that areas of alternate energy of hydropower, of, you know, all kind of new ways of tackling it are available and open and are being, you know, availed of, and we would like to, in my meetings here with the chamber of commerce, with the american business groups, i see a lot of interest within the u.s. and some of the companies who we are talking to so this is an area i think of prime focus for us. >> mr. minister, i think we could go on all day. unfortunately, you have other obligations so i think we have to free you at this time. we wish you very good luck with the balance of your stay herement i think you'll find a keen interest to work with you and your colleagues on what after all many of us believe is a joint enterprise. we wish you good luck.

we thank you for joining us today, and we -- if you join me in expressing our appreciation to our minister. [applause] we are now adjourned. >> thank you mr. hathaway. i have one request of all of you, please come and visit us. [laughter] >> i'm coming in two weeks. >> oh, good. [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations]

[inaudible conversations] it was right there written, sent around to the members. sent to the president. we thought about those things. i was on a program with o'reilly not too long ago, why didn't you tell us? why didn't you tell us the things that might go wrong. good idea. let's tell the enemy everything we might have a problem with so they can get about doing it.

no. that's not the kind of thing that you tell the press or talk about publicly but there's a list of page after page of things that doug and other people in the government thought about and talked about. and that was circulated and people were worried about. >> watch this discussion from the hudson institute tonight at 8 p.m. eastern on c-span. tonight on c-span to a discussion on race in america. >> you can't go to 10 stop to get enough footage to make the case this is a racist organization? you think there is a time among those 100,000 people that they said i don't care whether it is true or not? you think you can capture that on tape? like they don't care whether it is true or not and i think the

news media on the birth issue should say that's a dead issue. anyone who brings it up is ridiculous. if you get a phone call and they say hey, do you support donald trump, your answer should be no, he's an idiot. he's trying to sell me something. he's trying to hustle me out of my butt with a dead issue. no, i don't support him. >> watch this discussion tonight at 8 p.m. eastern on c-span2. >> our international coverage continues with a discussion on the political unrest in the arab world and a look at the conditions that give rise to revolutions. this is hosted by the cato institute. it's about 50 minutes. >> thank you, david. it's a pleasure to be here. thank you for a coming.ne i know it's tax day so you mayax have pressing issues on your mind. but i'm sure there's a lot of curiosity about the events in

north africa africa. why did the dictators who seem to be immovable suddenly find the strength of their regimes fail and their power dissipate. i think peter is absolutely correct, the skills and the power of the deliberate campaign of the nonviolent resistance are the immediate answer, these movements in tunisia and egypt were not spontaneous outpourings , they were the fruit of years of organizing which had produced numerous student demonstrations and labor strikes but it took years in certain locations for the organization to strike a chord and draw the support that was necessary to strip away from support from the leaders i would say i also believe it's important leaders in many ways created their own

weaknesses and vulnerabilities and was the combination of this vulnerability by the ruling family and a well-organized will fall out campaign of civil resistance that produced a rapid change what were those weaknesses? in fact the regimes in tunisia and egypt had become classic instances of with the fury of revolutions call a neo patrimony of regime. that is a regime that does not recognize the normal functions of law that invest so much power and a chief executive in places themselves in a sense of of the law and disposes of the wealth and resources of society largely as he is fit.

now rulers who had that type of power had many letters to keep themselves in power. usually they would use patronage to gain the support in the military and security forces, and among a variety of eletes. and if managed well, the use of patronage can keep them in power for decades. indeed, many personal sticklers stayed in power for years sometimes throughout their lifetime. such a regime can also slip op. it's possible indeed tempting to occur. what type of mismanagement in particular can we see in tunisia and egypt and i will get to the cases of libya and some of the other countries in a couple of moments. first, in order to keep money flowing to the regime to fuel the patronage, an authoritarian

leader in the modern world usually has to invest in some degree of foreign investment, educational improvement, productivity gains. but this effort at modernizing society in and of itself creates potential problems. what an education by into this part of the regime or will they find reasons to oppose it with a gain a certain amount of material benefit from improving the economy feel they have a stake in the regime or reason more people be shunted aside and excluded from the games that arise. in other words the dictator has to play careful game with patronage. if necessary to win over the key segments of society but not to alienate or exclude those who are also seeking to gain the

benefits of growth. it's a tough game to play and sooner or later most such and dictators cave in to the pressures from their family members were from cronies or even the feeling of invincibility that comes from a decade after decade in power and the start treating more and more of the national wealth and more and more of the growth in the economy that something exists for the benefit or the benefit of those closest to them. what happened in both tunisia and egypt is that regimes that started out as defenders of their country succumb to temptation to create a narrow circle of cronies whose corruption became the first noteworthy, been a source of natural revulsion. the situation in to nisha was one in which although ben ali

wasn't himself as corrupt as some other rulers, his family members essentially started running a protection racket challenging every business that stock its head up and gained a profit to contribute a share of those profits to the family purse. building seaside mansions, dictating terms, taking advantage of their closeness to power, ben ali's family's undermined his moral authority at the same time they enriched themselves, family members, sorry, i should say. now, it is a critical factor as dr. ackerman pointed out for the regime to keep the pillars the leaders of the economy, the leaders of the military, leaders of the security forces on the site of the ruler. that is also a of a rift in that inhalators strong business leaders to emerge allow the

strong military leaders to emerge they would become potential rivals and so to the plea we will see these neo patrimony all leaders try and make themselves indispensable by not creating any visible successors, not even creating a process for the succession, and trying to keep potential rivals at a distance. one common tactic is to divide the security forces so that the regular army and the police, the intelligence forces all have separate commands which report independently to the leader. this allows him to keep these forces separate with an eye on each other as rivals we can control them. but it also makes it much easier for one of these groups to defect if they feel a situation is going against them. it's also the case that the

leaders because they don't prepare an institutional path to succession often looked words family members at the end of the day as the way to secure the regime and patrimony in egypt even though no one foresaw a revolution analysts had been warning for years that the succession as hosni mubarak aged was when to be a moment of great risk there were no obvious successors, there were no strong rivals, and mubarak seemed more and more interested in shifting the succession to his son, jamal, who hadn't come up through the military, who wasn't a particularly popular figure, and indeed who had been enriching himself through his banking career and access to foreign investment and sales of each option property.

the succession was going to be a problem in terms of keeping the elite on the side of the regime. but what we didn't anticipate is the regime's would face in 2010- 2011 a perfect storm of global changes. first, prices which had risen sharply in 2007-2008, and we thought that's an exceptional event, well, they looked forward again in 2010, 2011. problems in a major wheat producers and rice producers, restrictions of imports led to an increase of about 50% in the price of the core steeples between the middle and then the 2010. now, governments and north africa had been subsidizing, they had been subsidizing energy committee and in guaranteeing jobs, all part of the patronage

based safety net designed to keep the population on their side. but since the late nineties under pressure from international financial agencies to reduce the subsidies, these regimes had been cutting back on the volume of subsidies, on the number of families who qualify for them and more and more families faced market prices for some or all of their basic needs. they felt these price increases. in addition, the number of young people had been building up rapidly in these societies. we are familiar with the concept of the large number of young people compared to adults and that is found throughout the world is who. what had been happening in march of north africa in the middle east the was a huge surge that is a recent increase in fertility combined with hollen

child mortality that led to huge increases, 50% over a few decades in a number of young people who had survived to become active young adults but not actively employed. those government guaranteed jobs that have been the way to assure the loyalty particularly of the educated youth had started to run out. and so while unemployment was modest among people who grown-up in the 70's and the 80's, for young people born in the 90's and reaching the late teens and early 20s just now, unemployment was horrific. officials on and when it was perhaps 25% in the middle east that's double the rate of youth unemployment elsewhere in the world, but unofficial estimates suggest that as much as half the population under age 30 didn't

have regular jobs. we know that in egypt only about half of the men under 30 were married. very unusual in a family centered society, but that reflected the inability of people to get jobs that would allow them to start a family. so the sharp impact of the rising prices fell upon societies with high rates of unemployment, low rates of marriage and therefore exceptionally large numbers of young men who were not attached to the social order by marriage of employment, and frankly felt not only frustrated and poor, but humiliated. they felt the system was denying them the dignity of a job and family, denying them the dignity of any control over their own lives, and it was this type of struggle to express themselves with dignity that led him to set himself aflame after he had been

humiliated by an official of the tunisian government. and people reacted to his self a malaysian by understanding the degree of english, despair and humiliation. he felt by saying we don't have to do this anymore. and starting small with a student movement that gained advice on the civil resistance from veterans of this movement, reaching out to labor, student and labor organizers planned days of resistance in a rural towns and cities first indonesia where the movement spread quickly with a fruit vendor expressed his rage to herself a malaysian, spreading to the capitol where the military fairly quickly resolved that although the mission was to defend the country they wouldn't kill large numbers of their

countrymen to defend a regime that was widely seen as corrupt and even a threat to the national welfare. in egypt, labor and youth groups assembled and called for resistance on brilliantly national police de a new holiday that was supposed to celebrate the police and people turned out in the streets and said we will celebrate the police. we will ask them to stand up for the country and therefore against a corrupt leadership that is damaging our nation. and although there were some episodes of struggle, there were real risks of violence and threats against protesters that escalated to a tax by both uniformed and non-uniformed security forces, the young people and their supporters from the labor movement, from the muslim brotherhood they all

agreed on one thing. now's the time, now the hitchens. after they saw what happened in tunisia that it was possible to wrest control away from a dominant leader. just as an two nisha the military in egypt, which had been increasingly excluded from the fabulous wealth seized by the civilians in jamal nagareda's circle decided they wouldn't turn their guns on people who were simply asking for the government to be accountable. and as the protest escalated, it wasn't clear what would happen. but in many cities throughout egypt, people for the first time set i'm going to stand up. i feel like a citizen. i'm proud to be in the egyptian today because i am acting to control the destiny of myself and my country. the movement spread not only through protests in the square or alexandria, but at the very

end when mubarak seemed determined to simply leave power with his recently elevated second in command professional strikes, lawyers, doctors, professors, shutting down critical institutions persuaded the military that mubarak had to go. this vision, this belief, this power is now spreading throughout the middle east. even syria, a country that people assumed was on lockdown and in which this was the kind of country in which things could not occur. civil resistance to first reached in a town that has now spread to dozens of cities throughout the country. and the leadership is already on the defensive. they are trying to decide do we strike back with more violence or would that be counterproductive as it has been

already? when a regime has lost legitimacy in the sight of its people, striking back is no longer a way to gain strength. it may gain power briefly, but it does not resolve the situation. let's talk about libya in a moment where we see exactly that. and syria the government is now concerned. how much can we give, where is the line at which people will accept a change without calling for more? we see a example that isn't really a state. the gadhafi family has their own regiments, loyal mercenaries were tribally affiliated groups that are not a part of the regular military. rather these are troops that have been trained, they are called in the press loyalists and that is an accurate description. many of the mainstream institutional militaries have

already defected as have many bureaucrats and leaders. the question now is will civil resistance be enough? we are seeing enormous bravery in the more technically advanced and better trained forces of the loyalists the of come is in doubt this is something perhaps we can explore and questions. i simply want to say that civil resistance began the struggle here. it's not clear whether the civil resistance alone will in it. and this is where nato needs to make a determination. and where the world has to decide is this indeed one of those cases where the governments can work effectively for the freedom of others? or is this a case where the government effort well as they often do make things more difficult and move the goal further away?