brings -- i watch him in his room. he make sure that he understands everything, and he's got a very good approach of trying to make sure he understands what everybody is coming from, what they need, what they can do, how to get to the place where they can do something. .. >> a complete default would only cost the world 1% of its net worth. question: why would the markets fall further? >> that sounds pretty good. [laughter] >> i told you, he's a smart one.

>> yeah. well, let's look back to last spring. so last spring, you know, as the european filer was building, you saw huge damage to confidence locally. the s&p 500 fell 15% over that period of time, and i think that was in part because, you know, again, people are still very shaken by the great recession, by the trauma, the crisis, how close we came. and at that, like, sparked a huge new wave of fear. and it's partly because people have a hard time understanding what is the magnitude of these problems? are those governments, do they understand, going to solve it sensibly? now, over the last six months or so even as the crisis deepened in europe, people have been more able to separate that from their concern about their confidence in the broader global recovery in the united states. you've seen much less contamination. but it's still a very serious problem, and apart from what

your brother said which is you could say he was pointing out this is a relatively small financial challenge to solve, i think people should understand that it's completely within europe's capacity to manage this in a way with no collateral damage. it's not expense e -- expensive. it's complicated, but it's not rocket science. and they have the political, they have the financial means and, i think, the political will to do it. but people want to see them do it. and, but i think it's a containable problem both for them and should be for the world. >> mr. secretary, you were the imf's director of policy development from '01-'03, you've seen some of the stories about people who have worked there who said there was a predatory atmosphere. "the new york times" said like the pirates of the caribbean, men on the prowl, women on guard. were you aware of those problems? >> i think to be fair to any cultural -- i think that's a hard question to ask a man. you could ask a woman that question. i think it's hard to find any,

no offense to men, i think it's very hard for men to understand what it's like to be a woman working anywhere. in that case, so you should ask the women at the imf. >> so it sounds like, no, you weren't. >> no, no, i wouldn't say that. but even if i was aware of said i was aware, i wouldn't have any feel or appreciation for it. i would say that, of course, you'd want to make sure that any institution like that has in place the highest basic standards for ethics and behavior so that no person working there, whatever their gender or background, faces that sense of insecurity or risk. >> now, since being arrested, dominique strauss-kahn has resigned. this is ha he reached out to you -- has he reached out to you personally? >> no. >> okay. and europe seems to brallying around -- rallying around having a european successor. where are you on that?

>> if you step back for a second, i want you to understand what's driving our approach to the institutions. remember, these were formed in the wake of the second world war, and they were set up in a really different era. and they were set up with a balance of power governing structure that reflected the balance of power in the time, and the world's changed dramatically since that timeful we have been leading working with, not just emerging economies, but even with europe, too, to make sure we change the governance structure to better reflect the balance of power in the world today, and that's a very important thing to do. we've made a lot of progress in doing that, but we've got some stuff to do. part of that is trying to make sure that you have a contestable employment process for these institutions, and people want to be confident that the judgment is going to be made on the merit and the talent of the individuals. now, we have -- i think you're about to have two people now, christine lagarde and augustine

carsons, current central bank governor of mexico, two credible people now have said they'd like to run the institution. and there may be others that join them. but i think you can look at this now and be much more confident that you're going to have an open process where people are going to look for the candidate that not just has the most experience and technical capacity, but who can command the broadest base of support. they're very talented people. christine lagarde is an excellent mix of financial, economic knowledge, talent and the kind of political skills you need to navigate in this context. augustine has that as well. and, you know, we want to see a process where we look to the candidate who can command the broadest support. >> okay. i'm going to ask you one more question about that, and then i'm going to go to ben white. do you expect that you'll wind up weighing in if between those two candidates? >> we ultimately will. but, again, what we want to do is make sure -- i think it's

good for the institution. remember, christine lagarde's strength is not that i would say principally ha she's european -- that she's european, her strength is what's the experience and talent, skills they bring to the job. but, of course, ultimately, you know, we're the largest single shareholder of the institution, and we'll play a significant role in not just making sure the process is fair, but the outcome is good. >> okay. a lot of you in this room know ben white. he's created an amazing morning bulletin, "morning money." thank you for being here, ben. i think you have a question. >> many i have a few, although i have to say asking questions after mike allen is never a very happy circumstance because he asks everything under the sun and does it incredibly well. just a couple of quick follow-ups. on the issue of the debt ceiling and the budget negotiations, i wonder if you think the result in the new york special election has a meaningful impact on that debate? it seemed from the outset

republicans were very emboldened to push the debt ceiling issue to the absolute limit and demand a very hard bargain on the four trillion deficit reduction target and, essentially, take it to the wall thinking that they had a mandate to do that. do you think that mandate has lessened based on this result and a general sense that there is less of an appetite amongst the public for some of the cuts that republicans are seeking? has the nature of the debate changed on that, do you think? >> i don't think the republicans ever had a mandate to default on the country's obligations. not a chance. i think in terms of the election, you know, i'm not a political person, so i'd say the following: i think what is clear is that we need to build on the reforms in the affordable care act to find a way to get more savings out of the health care system including medicare over the long run so we can afford to

give people who retire access to health care with an adequate benefit and an adequate burden to them. it is absolutely clear that we're going to have to do more reforms, more savings from the health care system going forward. but it's also clear that you do not need to, and we will not, dismantle that basic commitment to seniors and shift it to a defined contribution plan that shifts costs massively to the senior -- remember, the house republican budget illustrates what you have to do if you are unwilling to touch revenues. if you try to -- if your objective is to leave in place these exceptionally low tax rates for the most fortunate americans, then you are going to have to do transforming dismantling of basic commitments to our seniors, to the poor and to the elderly. there's no alternative for that. and can it's not going to

happen. we're not going to -- well, we never supported it. but, absolutely, we have to find ways to get more savings out of the health care system. >> l and what do you make of the new york resortsome. >> well, that's what i make of it, that we're not going to dismantle, there's no risk we were going to disman l. that basic commitment is a safety net for the seniors, but it's also true, and if you listen carefully to democrats, chris van hollen said it, we all recognize that we're going to have to build on the reforms in the affordable care act, go beyond that and get more savings out of the health care system going forward if we want to do that, again, in a way that leaves intact access to health care for seniors, doesn't leave them bearing an unfair burden of the cost. >> and i said one more. i'm sure you saw the ugly dust up between elizabeth warren and some republicans in the house oversight committee. i wonder what your thought is on whether the president should use a recess appointment to appoint

elizabeth warren to the head of the cfpb, or has she become so polarizing at this point that she's a distraction to the dodd-frank implementation process and he should go ahead and move on and -- >> i didn't watch the hearing, but i read about it. i was told about it. i thought what happened yesterday was deeply unfair to her personally. i think she's done an compleptionally good job of -- exceptionally good job of not just heading up this agency, helping to run this consumer protection. and you saw her just recently lay out very important reforms to simplify disclosure of a mortgage application so people know what they're getting, can make better choices and can protect themselves from people who take advantage of them. and that is a very important objective. and, you know, i would just say that, um, you know, the oversight process is a very important thing to preserve and

make strong and credible. and i think what you saw yesterday will leave everyone -- will lead everyone to question whether the oversight process is on the up and up. how much is political theater, how much is the necessary tough job congress has to do to hold public officials accountable? many you know, i've testified more than 50 times since i took office. and, you know, it's a hard, tough thing to go through. it's a necessary thing to go through, but for the oversight process to be viewed as fair and not just tough, but good and credible you have to try to make sure you take as much of the political theater as possible. it's impossible to take all the politics out of it, but you want to do that. that's why i think what happened yesterday is unfair to her and not good for the process. >> i think mr. woodward has a question. >> hi. on debt ceiling. if, as you know, there are members of the house of representatives who think this

is not theater -- >> not, not? >> not theater, the brinksmanship deny. >> i was only using theater in a disparaging way. [laughter] >> in what way were you using it? [laughter] >> i was just giving it its appropriate context. [laughter] but go ahead, bob, i'm sorry. >> well, to use your phrase, they're human beings. and as you know, they feel quite strongly about this. and the question is, what is your contingency planning that must be going on in case there is some sort of default? >> let me just say clearly, the united states will never default on its obligations. this country will never put itself in the position where people believe we're not going to pay our bills. it would be a catastrophic failure of basic governance to do that, and congress will do what it has always done which is to pass the debt limit. so our plan is for congress to pass the debt limit. our fallback plan is for

congress to pass the debt limit. [laughter] and our fallback to the fallback plan is for congress to pass the debt limit. >> but as you've said, sir, you live in an environment of all contingencies or all options on the table. you have to be considering that possibility. >> oh, i find it unthinkable. and, again, under our system of government congress has imposed on itself this unique obligation. no other country has it, i think. and, remember, you know, this is about paying your past bills. it's not about your future obligations. and, again, i am very confident that the leadership in congress understand that basic fact, and i am very confident they will act to make sure we can pay our bills. and, but i'm also confident that we have a chance to do something very important. >> so there's no contingency plan. there's no fallback plan.

[laughter] >> congress, i'll just repeat again, congress will do the right thing here. i think the harder thing, and i think it's, it is the more important thing, is to make sure we find a way to build a bipartisan, comprehensive, balanced fiscal reform plan so we're living within our means and that we're not leaving the economy vulnerable in the future to the kind of concerns that can build if you look like you don't have your arms around this. >> we're about to get the hook here. as we say good-bye, final question here. a question about the president. the president's, clearly, a smart guy, but he's not an economist. what's the toughest or hardest question the president has asked you. >> asked me? >> yes. >> oh. that's an interesting question. well, i'll tell you a story. i think this is a fair story to tell. um, i remember going to him the first day after i was confirmed, and i went into the to value office, and the vice president was there and larry summers was

there. and it's the first time, you know, we'd spent a lot of time talking about strategy in the financial system, but there was a whole range of things that were happening in the financial system that, that, um, we hadn't really talked about yet. and i went in to him, and i said, you know, we have these five very complicateed, potential catastrophic bombs we had to defuse sill, and it was -- still, and it was going to be expensive. it was going to take a lot of resources, and it was going to be politically terrible to go through it. but nothing was possible unless we did that. and then, as you know, we laid out a broad financial strategy that, um, people didn't regard with much affection and enthusiasm at the moment. but it was an excellent strategy, and we did everything we said we were going to do. and it had a huge impact in turning things around. um, that was not evident at the time immediately, and he did as you would expect. he asked, and he did this all

the time with us. he'd check in, how are things going, and he'd ask me, are you confident this is going to work? and that's, that's a tough question because, you know, if you look -- and i said this at the time. if you look back, it took economists 60 years to figure out what caused the great depression, what made it wrong, what was the lesson for policy from that period of time. so i said to him, i said, you know, mr. president, nothing is certain in life, but i'm very confident this strategy is better than the alternative strategies, it has the best chance for working. but that's an example of a hard question. >> politico is big on birthdays. in august you're going to be 5-0. how are you going to celebrate? >> i usually am just with my family, and is i'm sure i'll be with them again near an ocean. [laughter] >> ben white says you've tried surfing? is that going to be a regular thing? >> i want to make it clear for the record, i do not surf well.

[laughter] >> but you might surf again. >> i am almost 50, i may remind you. [laughter] >> but you might try it again this summer? or what could be your sport of choice this summer? >> i would do anything that involves the water or a sail or the surf or the ocean. it's, you know, it's the coolest thing. >> mr. secretary, we really enjoyed this. thank you very much for doing this. >> thank you, mike. [applause] >> well, coming up live on c-span today at 12:30 eastern, an elected member of both the palestinian legislative policy and the palestine liberation organization's executive committee will discuss the implications of arab political unrest for palestine and the search for peace in the middle east. that's live on c-span, again, at 12:30 eastern today. and next here on c-span2, a hearing on traffic satiety. that'll be -- safety. that'll be followed by paul ryan

and gene sperling. coming up at 3:10 eastern, white house budget director jacob lew, and later a hearing on international child abductions. >> over the memorial weekend, leaders from politics, business and entertainment offering advice and insights to the graduating class of 2011 at 3 p.m. and 10 p.m. eastern memorial day weekend on c-span. >> randolph babbitt who's the administrator for the faa and paul rinaldi testified tuesday on capitol hill on the recent incidents of controllers sleeping during overnight shifts and an increase in operational errors. this senate transportation subcommittee hearing is chaired by washington state senator maria cantwell. it's about an hour, 45 minutes.

>> good afternoon, everyone. welcome to the senate committee on commerce, science and transportation subcommittee on air vegas operation -- aviation operation safety and security. we are joined by witnesses, the honorable randy babbitt, faa administrator, and the honorable calvin scovel, inspector general, u.s. department of transportation; paul rinaldi, president of the air traffic controllers' association; and dr. greg belenky, director of sleep and performance research center at washington state university. thank you all very much for being here. today the aviation committee is holding an oversight hearing on air traffic control safety. and i know my colleague, senator thune, will be here soon, but i

want to recognize him in his new role as ranking member for this subcommittee, and i say that i look forward to working with him. the two issues we are going to focus on, basically, are advent of a series of recent incidents where air traffic controllers fell asleep during night shifts, and the increase in the number of operational errors by air traffic controllers. as you know, this year there have been a number of incidents involving air traffic controllers sleeping on duty, and i'm deeply concerned as i know the chairman of the full committee is about these incidents. some are clearly examples of unprofessional behavior on part of an individual controller. their actions are totally unacceptable. controllers do have a professional responsibility to come to work rested. unfortunately, some have used those incidents to try and tarnish the reputation of a dedicated group of men and women who do work every day to insure that our air space the is the safest in the world. air traffic controllers monitor

35,000 flights daily. roughly two million air passengers come into direct contact, or come into contact with air traffic control each day. we can talk about how the next gen technology is going to help us improve this system, but we can't forget that at the heart of our air traffic control system are approximately 15,000 air traffic controllers. the incidents do serve to highlight the legitimate safety issues of air traffic controller fatigue, particularly those working on the midnight shift. there is no escaping the science that shift work has the potential to disrupt the rhythms of the body and often leads to fatigue. fatigue can seriously impair the work performance of individuals such as air traffic controllers who perform tasks that require consistent concentration. ultimately, this raises concerns for safe operations of the air traffic control system. i applaud secretary lahood and

administrator babbitt for taking quick actions. i know these actions will be helpful and hope to improve some of the situation. the national transportation safety board has examined and made recommendations on air traffic controller fatigue, most recently in the aftermath of the 2006 crash of the comair 1591 in lexington, kentucky. it took until 2009 for the faa to get the fatigue work group underway. my understanding is that they have jointly made a dozen recommendations to mitigate air traffic controller fatigue. the first two legal recommendats have to do with allowing air traffic controllers to recuperate during their break shift, particularly on the midnight shift. historically, the question of allowing air traffic controllers to take a break or nap has been a political one rather than a scientific one. there are decades of science on this issue, and we look forward to hearing more about it today.

and i want to say to dr. belenky, thank you for coming all the way from the west coast, from washington state university, and we look to hear more about the sleep and performance research center and the sciences behind that center. i am, likewise, concerned by the 53% increase in reported operational errors between fiscal year 2009 and 2010. operational errors are situations where planes come too close to one another in the air. the number of operational errors increased from approximately 1200 in 2009 to 1900 last year. the errors were of varying degrees, and i'm sure we'll get into that during the hearing. on march 2nd the committee asked the d.o.t. ig to conduct an assessment of the faa's current categorization of operational errors to better understand the impact and actual implications of this. last decade the ig identified

the problems with how most faa facilities self-reported operational errors, and the ig expressed concern that there was a significant potential for upside underreporting operational errors. beginning in this 2008 the faa made a series of changes. it initiated the air traffic safety action program, a confidential reporting system to encourage air traffic controllers to come forward with these reported errors, and it began rolling out an automated reporting of operational errors through a new software system called the review program. the committee is trying to understand if reasons more errors are being reported is because of the faa finally having a more objective and reliable process, or whether we are seeing just an increase in errors. so i thank all of you for being here today, look forward to your testimony at the hearing and coming up with answers on how to continue to improve air

transportation safety. i'd like the call on the chairman of the full committee if he'd like to make an opening statement. >> i would say to, madam chair, you said everything i was going to say, so i don't see any reason to repeat it. so i put it in the record. >> thank you, mr. chairman. and the ranking member of the full committee, senator hutchison? >> well, thank you, madam chairman. i think you certainly stated the case very well. i want to welcome you as the chairman and john thune as the new ranking member of the subcommittee and look forward to working with you especially on faa reauthorization which has just been hotlined for the 19th time to be extended. and i hope that we can come together in the next month and pass a bill that all of us worked very hard to get across the floor of the senate, and be it's now in conference. so this'll be a major mission

for your subcommittee. and your topic today, of course, is very timely, and i appreciate all of your being here. i want to say i do think that we have had such a safe aviation safety performance, and in general the air traffic controllers have done a superb job. we pass 790 million people per year through our system, and there are 29-30,000 safe flights every day. that is a mark in our favor. however, of course, in the last five months we have had alarming lapses, and the -- not only the air traffic controllers who went to sleep, but apparently one was watching a movie during the time he was on duty and, um, i think the air traffic control

incidents and near misses have caused the reason for us to have a hearing. and i think that we have to have a system in place, as you must know, that catches any kind of weakness in the system and takes action to remedy it. mr. babbitt, you are going to be putting 11,000 new controllers in place by the year 2020. there's the turnover, of course. so i hope that we will hear that you are going to be looking at fatigue factors, training, scheduling and professionalism as we are going into this transition. madam chairman, i have to say that i have a 3:00 introduction of a federal judge candidate, so i'm not going to be able to stay for the whole hearing, but i will certainly look at the record and be very interested in the results.

thank you very much. >> thank you, senator hutchison, and thank you for your leadership on trying to move along with the chairman the bill through the process. senator nelson, would you like to make an opening statement? >> madam chairman, an extraordinary number of air traffic controllers do an extraordinary job under exceptional circumstances. but the subject of today's hearing, i think, underscores all the more why we need to move to the next generation of air traffic control. where operating off of a series, a constellation of satellites there will be this cockpit updated information for the crew to know situational awareness at all times in addition to what they're being told from the controllers on the ground. and yet we keep dithering and

not funding the steps that we should toward the next generation. it's happened in a lot of our states. just in april we had a controller asleep in miami. in march we had two controllers that vectored a southwest airlines very close to a private aircraft. next generation of air traffic control would help that situation. but in the meantime, we've got a problem that we have to address. by the way, if you can figure out fatigue and sleep on air traffic controllers, it could sure apply to a lot of other professions as well. so i look forward to it. thank you, madam chair. >> thank you, senator nelson. and i'm sure that you do have a very unique perspective on this, and we look forward to your

questions at the appropriate time. um, mr. babbitt, we'll start with you. thank you for being here today, and thank you for your testimony. and thank you for your leadership during this period of time. .. we're also taking a substantial number of actions to improve the level of safety. before i address these

actions i think i would be remiss if i were to appear before you and not mention the need for multiyear reauthorization. we have a tremendous responsibility to enhance the safety of our airspace system and transform it what the radar-based system of the last century to the satellite-based system of tomorrow. to accomplish our goals the faa needs a multiyear reauthorization with sufficient funding levels. as you know the faa has not had a steady source of funding for over three yaf nears now. instead we relied on 18 short-term extensions of our spending authority. so i'm very pleased that both the house and senate passes reauthorization bills. we very much appreciate your support. it is a important step forward. however if authorized funding levels in the house bill and they are well below what the president proposed in his 2012 budget, if those levels were appropriated it would degrade the safe and

efficient movement of air traffic. if we delay infrastructure investments of today, the long-term cost to our nation, to our passengers and our environment will far exceed going forward with a cost of the technology and the infrastructure improvements we need for tomorrow. now i would like to turn now to the reason for today's hearing and update you on actions we have taken regarding fatigue and incidents with air-traffic controllers. last month i had the pleasure of traveling with paul rinaldi, the president of the national air-traffic control association to air-traffic control facilities all around the country. we were on this tour for call to action promoting both safety and professionalism for the controllers. the visits reinforce to me we have a workforce committed to safety 24/7. that the incidents of employees falling asleep on position show we have to make changes and we have. we have made significant changes to long-time scheduling practices to

reduce the possibility of fatigue including establishing a minimum of nine hours between shifts and we'll do more. we've added a second controller on midnight shifts where appropriate in facilities where there was only one. we've also changed management in critical positions to insure we have the right people in the right places. we also unfortunately found it was necessary to terminate three controllers who were asleep on the job. this type of behavior is completely unacceptable. the faa and along with outside experts joined together to obtain 12 recommendations with faeg. we have in formal discussions with natca on recommendations. i want to address the concerns in rise in reported operational errors we've seen over the last few years. i share your concerns. everyone at the faa is personally committed to the safety of our aviation system. any potential upward trend in errors is deeply troubling.

however we believe the trend reflects changes that intuesdayed in recent years to encourage reporting of errors. that data will allows to make more informed decisions moving forward to overall enhance the safety of the system. our voluntary reporting program is called atsap we encourage air-traffic controllers to operate operational errors next change for the agency to addressing errors in a nonpunitive manner. this is program similar that exists throughout the airline industry. these reports have given us information about everything from windows fogging up to problems with towers and radar equipment and ground markings. in albuquerque, that pilots were missing a hold line own the runway. a atsap report became a solution and not an incident. while the solutions in ats&p

are not counted as errors this creates a culture of change in reporting within the faa. and this is ultimately a very positive change that will enhance safety by enabling us to identify risk and to spot trends. in addition to this cultural transformation we rolled out new software that automatically detects operational errors and then reports them directly to the faa's quality assurance program for analysis. nobody likes to see operational errors especially me but we are getting the data today that we need in order to improve safety. the american public trusts us to perform our jobs and make safety the highest priority every day, year in, year out. we're committed to making whatever changes are necessary to preserve the trust and to continue to provide the safest and most efficient air transportation in the world. that concludes my opening statement and i would be happy to answer questions when that time arises.

thank you. >> thank you, mr. babbitt. we'll look forward to that opportunity. mr. cove develop, thank you very much. you can press the red button. >> mr. chairman, madam chairman, ranging member hutchison and thune. members of the subcommittee. thank you for inviting me on the timely hearing about the faa air-traffic control system. recent incidents including high-profile operational errors underscore the need for i am approached oversight the system. and managing the nation's controller workforce. over the past decade we in dot's office of inspector general repeatedly raised concerns about faa's reliance on controllers to report operational errors and faa failure to uncover reporting inaccuracies. our audit and investigative work has shown some error reports were misclassified as nonevents while others were intentionally

manipulated to cover up errors. faa's recent deployment of tarp, its automated reporting system for the terminal environment, should help reduce these weaknesses. however concerns remain about faa's efforts to accurately count the number of operational errors and identify troubling trends. for example, it's clear how faa will use another recently implemented the tool, the lofton index. excuse me unclear how faa will implement the loss index to improve it's operational error data and assess risks. without reliable reporting systems and processes, faa's data on operational errors have little value. recent faa data indicated that operational errors increased substantially in the past year. however, faa officials have stated that the increase is likely due to improved reporting practices, not to an actual rise in breeches of aircraft separation standards. we recently initiated two audits to explore these issues in depth. while the lack of trend

analyses makes it difficult to identify and target the root causes of operational errors several unresolved controller workforce challenges may contribute to these errors. first, ntsb identified controller fatigue as a potential contributing factor in several operational errors however, faa investigations of operational errors do not always develop at a quick data on controller fatigue. further, our audit of three complex air-traffic control facilities in the chicago area determined that minimal rest hours between shifts on-the-job training, and scheduled overtime may contribute to fatigue. in june 2009, we recommended that faa determine the extent to which fatigue could be causing operational errors and to identify and address root causes of fatigue. ntsb and an faa work group have also made numerous recommendations to minimize sleep debt. today these recommendations have not been implemented. second, faa faces challenges

in achieving its goal to replace retiring controllers with 11,000 new controllers by 2020. in large part because requirements in its training contract were not well-defined, and the contract costs exceeded the first two years estimates by as much as 35%. because the costs were so far above estimates, faa has been unable to implement new approaches in programs expected to improve the quality and timeliness of controller training. at the same time, faa lacked adequate metrics to measure the effectiveness of its controller training program and to make needed adjustments. at our recommendations faa recently established more complete metrics for evaluating its training successes. finally, faa's controller placement process does not adequately consider controller's knowledge, skills and abilities when assigning them to faa's more than 300 traffic control facilities. as we reported in april 2010,

faa assign new controllers in facilities based primarily on their choice and available vacancies. -- faa is assigning new controller candidates to some of the nation's busiest and most complex air-traffic control facilities with little consideration whether they have the required skillsets for those locations. more than 20 facilities that faa deemed critical to nas operations have a significant percentage of their controller workforce in training. in 2009, we reported that southern california tarcon faced a prospect of having over 100 controllers in training. more than 40 percent of its workforce, potentially overwhelminging the facility as training capacity. more recently we found that denver terminal radar approach control has 4% of its workforce in training. and laguardia air-traffic control tower has 39% in training. we are currently reviewing faa's plans to provide its critical facilities with the

appropriate controller staffing, training resources and other support and expect to report on our results later this year. in closing i want to commend faa for ramping up its efforts to tackle these complex challenges. sustained commitment will be critical to insuring an alert, competent and certified controller workforce. madam chairman, this concludes my prepared statement. i would be happy to he is address any questions you or members of the subcommittee may have. >> thank you, mr. scovel. mr. rinaldi thank you for attendsing hearing. thank you for your testimony. >> chairman can't well-. >> is your microphone on? >> there you go, chairman rockefeller, madam chair can't well, ranging. represents over 15,000 air-traffic controllers within the faa. our controllers are dedicated professionals with a passion to run the safest, most official system in the entire world. according to a recent mit

study, you're safer on a commercial airline in this country than you are on a escalator. we had over 9 million commercial flights with zero fatality it is. that is something we're very proud of. we can always do better and we can always make the system safer. in this testimony i would like to address three tropics. one would be the professionalism of the air-traffic control system. two, would be increase in operational errors and three would be fatigue in the air-traffic control work environment. i need to be very clear. the air-traffic controllers are very professional. we workday in, day out, 24 hours a day, 7 days a week, 365 days a year to run the safest, most efficient system in the world. on an average day we work over 70,000 operations. we save lives, we make emergency situations look routine. and that will never find its way into the press. we're very unfortunate to

have these incidents that have happened and found its way into the press and we are not satisfied with it. we are not happy with it and we have worked very closely with administrator babbitt to insure that this will not happen again. we're proud professionals and dedicated to the safety of the public, the safety of the flying public. i along with, with executive vice president trish gilbert have traveled throughout the country with administrative babbitt, the deputy administrator to address the issues with the controllers to insure that professional system first and foremost in the operation. that the safety of the flying public is first and foremost and stays on the focus of every air-traffic controller in the system. over a year ago we started working jointly with the faa to develop a professional standards program which is peer-to-peer to really instill we stay focused on the safety of the flying public. i've heard some statements

today there is great interest in the increase in operational errors in the air-traffic control system. i'd like to make two points on that. first, the vast majority of operational errors are not safety risks. we don't believe comparing 2010 numbers to previous years is appropriate. we have a big change in the faa and a change for the better. i commend administrator babbitt for bringing a new culture or culture of just culture, of reporting every instance from the lowest to the to address every issue in the safety system to enhance the safety of the system anyway we possibly can. fatigue is real in our work environment. it is something that we have tried to work with the agency and with the previous administrator but we are working with the administrator, administrator babbitt for the last 12 months trying to put together 12 recommendations along with science and nasa

scientists and the faa and guidance with the ntsb to address fatigue. it is a high-stress occupation and is something that, it is something where perfection is the bottom line and anything less than perfection is completely unacceptable. in closing, natca is on the forefront of improving the safety of the national airspace system. we have pushed for years for the atsap program to voluntarily report situations that might cause safety problems in the system. we jointly develop professional standards with the faa and over the last year we worked real hard with scientists with the faa to come up with 12 recommendations to improve fatigue in our work environment. we look to implement these 12 recommendations as soon as possible. we have to be 100%, 100% of the time. anything less than that is completely unacceptable. i can't stress enough that

the men and women, the fine men and women of the national air-traffic controllers association work the safest, most efficient, most complex system in the world. i want to make sure we do focus on that. i thank you for your time and look forward to answering any of your questions. >> thank you, mr. rinaldi. dr. belenky thank you for being here and which look forward to your testimony. >> thank you, distinguishes members of the subcommittee, thank you for the opportunity to testify on fleet fatigue and performance in air-traffic controllers. i'm gregory belenky. i'm a physician by training and research profession and director of the sleep and performance research center at washington state university. i joined wsu in 2004. prior to that i served for 29 years on active duty in u.s. army to develop systems managing sleep and sustain performance in military operations.

at wsu we're continuing this work studying sleep and performance in operational environments, operational environments which if the human fails, the system fails. chairman cantwell it is important for the subcommittee with the critical role in safety which air-traffic controllers inadvertently fallen asleep or deliberately napped on shift. questions abound in one extreme. is this a moral failing on the part of a few air-traffic controllers or does it indicate a systemic problem in the original naysing, staffing and scheduling of air-traffic control operations? i believe it is a systemic problem, specifically the well-described sleepiness, insomnia and degraded performance generally character i can of all night-shift work. air-traffic controllers are the same physician logically as any other night shift worker and the same principles apply. what can we learn from the

incidents of air-traffic controllers sleeping on duty? by inadvertently falling asleep or deliberately napping on shift, air-traffic controllers are pointing, in my view, to a possible problem. they are identifying perhaps shifts and schedule of shifts that may carry relatively higher fatigue risk and in need of fatigue mitigation. and by sleeping on shift they not only point to the problem, they point to a solution as well. the primary mitigation of fatigue is sleep and in this case, additional sleep could come in the form of sanctioned scheduled on-shift napping. in the early morning of august 27th, 2006, comair flight 5191 crashed on takeoff from lexington, kentucky, killing 49 of the 50 people on board. the crash occurred at a time when the xolair traffic controller on duty was working the last shift of a 221 series of shifts considering of two evening shifts one day shift and final one one night shift.

there was eight to nine hour break from the end of the second day shift to the final night shift. you unfortunately the break fell largely in early mid evening in so-called forbidden zone for sleep. the controller was only able to sustain sleep for two to three hours in the late afternoon. comair 5191 crashed at 6:06 a.m., captain, first sister and air-traffic controller failed to tee tech the plane was on wrong runway, a runway much too short for successful takeoff. fatigue analysis including prediction modeling suggests at the time of the crash the air-traffic controller's performance was impaired by a combination of sleep restriction and working in sir qaedian low. given the structure of the 2, 2, 1 shift series on-shift nap would be only way to increase sleep time in the controller during the 24 hours preceding the crash. though the national transportation safety board

did not implicate fatigue as, as a cause in the crash of comair 5191 i believe it is possible had the air-traffic controller had more sleep and been less fatigued he might have detected error in runway choice and prior in attempt to take off and prior to averting the disaster. this is the stochastic nature of air incident and accident. probablistic element. i suspect one way to sustain operational performance and well-being in air-traffic controllers working night shift, sanctioned scheduled on-shift napping. we would could propose the counter measure affect sanctions of schedule napping on performance vigilance and night shift operations in select air-traffic control sites. previous work in air-traffic controllers working the night shift has shown that even short, poor quality naps, improve alertness and performance. as research scientist i can describe what the scientific evidence suggests is possible and propose ways to develop more relevant evidence. the members of this

subcommittee as well as labor and air-traffic control management must decide what is feasible and desirable within the range of possible countermeasures as supported by the evidence. thank you, chairman cantwell for the opportunity to testify before the subcommittee. that concludes my remarks. i would be happy to answer any questions that you and the members of the committee may have. >> thank you, gentlemen. thank you, doctor belenky and thank you all for your testimony. dr. belenky i think i will start with you on, this last point that you just made about what is the optimum asked you'll talking about within the framework of what exists today but is there an optimal schedule to minimizing fatigue? >> well, senator cantwell, yes. it is day time work and nighttime sleep and unfortunately there is no good solution for night shift work. a lot of things have been

tried. stimulants. bright light. medical tone anyone. melatonin. >> i'm referring to the two, two, one schedules. do organizations strict night shift workforce have a better way of dealing with this issue as opposed to this mix of day and night shift? >> the rapid turn on the 2-2-1 is particularly troublesome. there are problems with full-time night shifts rotating night shifts forwardly rotating, backwardly rotating. none of these are good. early starts pay a huge penalty on sleep time and performance degradation. they're almost as bad as working permanent nights. there is no good solution. there are a lot of partial fixes that make things a little better. but, no one size fits all

schedule that will work under all circumstances. i hope that he is, is that -- >> thank you. i wanted to clarify that and your testimony obviously talks about what you think some of the remedies are within that framework. i want to go back to mr. scovel and your testimony. i wanted to, do you have a sense there's been, why there has been this significant increase in operational errors since fiscal 2010? i know mr. rinaldi doesn't want us to look at 2010 but, do you have a sense of this? >> thank you, madam chairman. yes, certainly the numbers reported by faa do show an increase in reported increase in operational errors from 2009 to 2010. the 53% increase in fact, 1234 errors in 2009 to 1887 in 2010. the question is why? as our written statement

attempts to show, we don't know. neither does faa at this point either. it could be that a reporting practices, and we think that probably accounts for some of it. it could be an increase in the number of operational errors itself, and then through better reporting practices that increase is also captured. the reporting practices that i'm refering to are what both mr. rinaldi and administrator babbitt spoke of earlier in their oral statements. and that is the air traffic safety action program has encouraged an atmosphere self-reporting minus possible professional repercussions for controllers submitting reports. however, mr. babbitt has stated that reports of operational errors submitted through ats&p are not included in those counts. that can not explain the increase. traffic analysis and you referred to madam chairman, in your statement may

explain part of it. and in fact as we sliced and diced some of numbers we found an 86% increase in reported operational errors at tracon facilities where tarp is now in place from 2009 to 2010. that would account for part of it. however we're puzzled by the fact as well that enroute air-traffic control facilities reported operational errors increased 39% from 2009 to 2010 and on route facilities they have had a program like tarp, automated detection and reporting tool, in place for some time. that would indicate at least on route centers there is an absolute increase in operational errors. we don't know why. in our visits to air-traffic control facilities as part of our audit work, we have discussed this with managers and online controllers and they have told us some of them believe that it's due to the increased number of controllers in training, and

that stands perhaps to logic. others have told us they think it's attributable perhaps to controllers at the midpoint of their career, who are beyond the training stage when they might be more careful in each and every action, and who have become somehow, more complacent. we just don't know. but madam chairman, you have kindly asked our office and we have requested in hand as well from the house, to review both the air traffic safety action program as well as the faa's loss index which will attempt to capture all such losses of separation, category rise them and we hope, attempt to gather some data on those so it can be properly analyzed and corrective measures prescribed. >> mr. scovel, following up on that last point before i turn it over to my colleagues, do you have any information and data as it relates to that separation, loss of separation issue as it relates to this fatigue issue? any information about that

today? >> i'm sorry, madam chairman, are you referring specifically to the loss index or? >> loss of separation of flights and this issue of fatigue, have you found any issues of how those are connected at this point in time? >> in 2009, at the request of senator durbin, we examined potential fatigue factors at the three main air-traffic control facilities in chicago and we identified at that point scheduled overtime, minimal time for rest between shifts with a counter rotational shift pattern with progressively earlier times as well as high demands for on-the-job training on the part of veteran controllers at those facilities, they reported a degradation in their performance and increased fatigue as a result of that. we did not link those specifically to operational errors. >> so we don't have a link between these two issues at this point? >> we don't through the work of my office. >> operational errors and

air separation? >> yes. >> okay. senator rockefeller. >> thank you, madam chair. mr. scovel, i think you said the first time around that there's, it's very important to place people in the right airport, right air tower and that large and complex ones for those who are just in training or relatively new into it is maybe not a good idea, and so that makes me want to ask randy babbitt the question of how he handles that? how are people assigned? you may want to comment on this, mr. rinaldi? how are people assigned? strikes me as a very smart point that he made. it doesn't cure a lot of problems but it sort of creates a baseline of at least an attempt at prioritizing.

>> to answer the question the placement has been made far more rationly today with the ability under the new agreement we have the air-traffic controllers we now can provide incentives to air-traffic controllers to move to the more complex facilities. we didn't have that opportunity under the last agreement and therefore, we often had a situation where a vacancy would open in the most complex of facilities and no one would bid it. so we were forced assign people fresh out of training, not necessarily in accord with our wishes but simply the only way to fill a vacancy. that was unfair to the controllers involved. it was unfair to the controllers doing the training. it was unfair to the facility. that has been remedied. today, now controllers can and will bid the more complex facilities. we often, i think, in any business venture, when you assign people we certainly pay attention to how they do in their training but we like to think that everyone who graduates from the academy is suitably

qualified to operate anywhere in our system. we also try to honor the wishes, if someone grew up in seattle and wanted to be an air-traffic controller in seattle that is vacancy we would let them bid into seattle, new york, or where they might be . .

years. i'm a very well qualified controller but in that transition, i am treated as an in-training and, therefore, i count in the ranks. a year ago that number was 30%. today it's 25% so we are reducing the number of retirements. there was a surge. we had an exceptional number of retirements for three or four years after the last -- not the current agreement but the previous agreement let a lot of people retire. we had an enormous surge in retirements and, therefore, an undue increase in the training. i believe the inspector general noted we had a 25% increase in cost. we had about a 35% increase in training, which would account for that increase in cost. >> my time is about to run out. i'll get to you next time, mr. rinaldi. as a background for all of this, the house has passed a budget which would take everybody, the

faa back to 2008 levels. now, i'm just trying to consider what the effect would be on what we've discussed so far, what the flexibility would not be for and others because of the disparate -- the fact that a lot of these people would be laid off and you'd be dealing in a winter wonderland. i would like to you explain how -- if we went back to 2008 levels, and believe me i'm not going to let us do that, but if we do, the world needs to know what would happen on your watch about this? >> well, let me start with saying i'm not going to budget safety. safety will maintain at the level that it is today. we're going to inspect all the airplanes, the facilities will operate. we don't have the option of shutting down radar for 10% of the time because we had a 10% budget cut so we will maintain the level of safety but the areas where we will feel impact, for example, in flight

standards. we have over 850 requests today. these are airlines that are buying new equipment. they're pioneering new routes. they're doing a lot of new things, maybe opening new stations. these all require our certification. we have 2400 in items, safety items, that are in the queue to be certified. this is new wing tips, new electronic equipment, advanced engines all need certifications. these are all objects that would make the aviation system, better, cheaper -- >> but nobody can't do anything until they get certified? >> they can't do anything nor would they employ people who would build them which leaves the final point next gen itself. i read a private sector report if we delay next gen five years delay, it will cost $148 billion worth of the potential value that we get by building the systems. so to delay it five years has an

enormous impact. >> i thank the chairman. >> thank you, senator thune. >> thank you, madam chairman and i want to thank you for holding this important hearing today and for our witnesses for testifying. and this is my first hearing as ranking member. so i'm looking forward to tackling the important issues that fall into this subcommittee's jurisdiction. i think in most circumstances our constituents always want us to be able to share their experiences and when it comes to flying, the way most of us do, most of reduce frequent fliers so we can certainly identify with the challenges that people face in traveling. and i want to work with my colleagues on this committee to ensure that our consumers in this country have access to fair and timely air service. in the 25 million square miles of oceanic air space that the faa is tasked with monitoring involves roughly 15,000 air

traffic controllers and almost 13,000 contractors and together they ensure that our nation has one of the safety aviation systems in the world. but as we have found from recent reports there's still a lot of work that needs to be done and so i appreciate hearing some of the steps that are being mentioned today. and i wanted to take up a question, if i might, mr. babbitt, with you, regarding next gen. you mentioned it. and i'm aware that faa is in the early stages of implementing some major advances in air traffic control management with the next generation air traffic control system, the system will use technological advances to make aviation safer and more efficient. in some cases, aircraft will also be flying closer together, more safely. that's the plan. to what extent, if at all, do you see the next gen system preventing or reducing incidents that could be caused by controller errors? >> well, one of the advantages

that the next gen system brings us is very enhanced and increased situational awareness so that the display in the cockpit will show all the aircraft around your aircraft. so you'll have essentially the same display that the air traffic controller has and it's just simply a backup system. we have, as hard as we try, there have been situations where radar fails. sometimes it's for a few moments. a few seconds. but when airplanes are closing at a closer rate at 8 miles each and combined miles 16 miles 20 seconds is a long time and having the warnings that you would get from that type of situational awareness increase and warning, technology could be a huge lifesaver. so, yes, it gives us is much better situational update, a more time ly -- people don't think about it large radar sweeps and paul could tell you i

think it's 9 to 12 seconds between updates. airplanes go a long time in 12 smiles that's when they update themselves again. these are instantaneous. they are constantly showing the accurate position of where the aircraft are. >> is there anything in the next gen system that can be improved that will alleviate problems about controllers falling asleep? >> well, the issue there, i think, is being managed a little differently. we're taking a real hard look and working with our colleagues at nadka to work through the scheduling process and fatigue issues and the technology of next gen is going to be more effective in terms of providing everybody with better situational awareness of where the traffic is but, no, i don't see the relationship, you know, to alertness. >> if anybody else on the panel would want to respond to that, feel free to. i was directing that to mr. babbitt, but i also wanted to point out, i guess, over the

next 10 years we're looking at 11,000 new controllers being hired and trained and so i would direct this to you, mr. babbitt, as well but are there any programs in place that would be able to identify who might be more adept or who might have the greatest defects in working that shift, is there anything you can look at in evaluating personnel? >> dr. belenky share a lot more on that. >> doctor, if you could. >> but one of the things we did just in terms of overall training. this morning i kicked off sort of our blue ribbon panel, if you would, a group that we've selected in this overall review of air traffic training and this panel of five is going to look at every segment of how we -- how we hire, how we train, how we requalify our controllers. are we teaching them the right things? is the curriculum right? you know, are we getting the right ratios through our school

and these are all individual experts in their field and so i'm looking forward to their report to us to help us improve the training of the controllers. >> the people who are morning types do not do as well in shift work as people who are evening types. this is actually a difference in their rhythm. this is physiological difference between people. so evening types do better. also younger people do better. as you get older, sometimes people tolerate shift work very well, cease to tolerate as well or tolerate it at all. this may be because as we get older, we become -- we shift to more and more morning type. so this is an issue. and there are physiological differences that do speak to people's ability to do this. >> but it just seems like with

that kind of information that managers might be in a better position to schedule and mitigate potential issues for controllers before they happen, if that -- if that kind of information and data is available? it sounds like it is. >> it is. this is accepted within the field. >> okay. madam chair, my time is expired. >> thank you, senator lautenberg? >> thank you, madam chairman. i was beginning to feel kind of lonesome here because we introduced the chairperson, then the chairman of the committee, the ranking member and then members of the committee. so i am multiples here, members of the committee. and i'm glad that we have a chance to have this exchange. it's really important and when we look at the numbers that fly every day and how well -- how good the performance is of the

controllers force, it's really remarkable but the very obvious glitches that are in here when you look at now that six incidents in which air traffic controllers and supervisors are caught sleeping on the job, 14 pilots land planes with no assistance and i understand, mr. babbitt, that you're taking steps to ensure that there's at least two people, is that correct, in the tower at all times? but i wonder in the processing of appointments to various stations, are there any prohibitions against second jobs? i'm sure a lot of people enjoy second job income and among the controllers as well as other people in the work force. do we have -- are there any rules that say, look, you can't

have strenuous exercise before you come to work and that has to be a pledge. i don't know how you monitor it, but the fact of the matter is, someone just had a 5 or 10-mile run and then comes to work, you could be headed for a very serious problem, dr. belenky? >> thank you, senator lautenberg. the main determinate of sleep time is work hours. so you add the work hours with secondary jobs, other employment, you cut into your sleep time. i mean, it's the main deterrent. the first is work hours, the second is travel time including dropping people off and commuting and the third is family and community responsibilities. >> right. but with all of those things -- i mean, to answer the question as i put it, i mean, how do you regulate a behavior

because that obviously has to do with sleep now. i know when i get older, i'll probably, as you said, will need more sleep. right now i'm good. [laughter] >> but anyway -- >> i think you said just getting up earlier. >> yes. [laughter] >> we can't continue this dialog. and i'm so proud of our work force, mr. babbitt. but as you know, and there are thousands and thousands of really well good movements and no problems and so forth. but it's not the good things you do. that's expected. it's the bad things that happen that we're focused on because one incident can be one far too many and we have to be careful

with that. so, you know, we had a major assault on controllers some years ago where the whole force was terminated virtually and had to rebuild. and i hear you ask -- plea for sufficient budget to take care of your responsibilities. now, but then on the other hand, i like what you said, that safety is the most important issue and there will be no compromise on safety. but how do these things come together? if you don't have enough money in the budget, it's pretty hard to say, well, okay, we're all going to do safety measures. the greatest safety would be to spread the hours out, 10 hours about jobs or whatever it is.

there's a inconsistency there and i think not unlike the military -- i mean, when we sent people to the front, we had to have enough bullets for them to carry. and if we send people up in those towers, those jobs are equally important because a mistake could be unacceptable under any condition. so how does that -- how does that work out, the budget and safety? >> senator, i'll expand a little bit on the comment that i made. you're asking me to make somewhat of a sophie's choice, and i indicated that we would not compromise safety. and we won't. we have a very dedicated work force. the air traffic controllers, we're going to staff and man and make certain that they have the rest they need, the education they need, and so forth. but what i did indicate was there are areas that are more discretionary and, for example, the certification -- we're looking right now -- there are three different facilities being proposed to be built on the east

coast of the united states. one is boeing, one is honda jet and one is embry air. all three of these facilities propose to hire anywhere from 1500 to 4,000 employees and each of those facilities has to be certified by the faa. now, is safety going to be compromised if i build one four months later? no. but i would suggest to you -- i think the american public would be far better served by building that plant and putting 4,000 people to work four months earlier rather than me be lacking 10 people to inspect the plant. so we're being forced to make some decisions, some discretionary spending decisions that i think, you know, there's a fairly significant business case that would support the requests that we've made. and i appreciate -- all of us want to do better. we want to do more with the funds that we have. i think we're very good shepherds of the taxpayer dollar. i can point you to savings we have -- we have undertaken programs within the faa. we saved $560 million in the

last five years and that's money that we took to programs and didn't ask people for more money. we funded those from internal savings. we're going to save $85 million this year, much of it from i.t. consolidation. we've got plans going forward to share our services better and to be more efficient but at the end of the day, not having the funds that we're looking for, will have consequences. it won't be safety but it will have consequences. >> it's got to be someplace. you can't -- you can't get more -- more liquid in a quart bottle and the quart will hold. the quart is intended to hold and i don't know how, madam chairman, that we can say, okay, build additional airplane-building facilities, bring more airplanes into the system. and not be guaranteed that we have enough funds to supply the

appropriate number of controllers and there ought to be a formula established that says, okay, you want to cut -- you want to cut the funds that go into the faa? okay, then here's how many controllers we have. and we say there can only be "x" number of airplanes in the sky so that there isn't a question about -- this tug of war that you find ourselves in and that we find ourselves in where, oh, it's going to be cut, cut, cut. when you cut too much, the blood starts running and that's what we have be careful for. thank you very much. and thank you all very much for your testimony. >> thank you, senator lautenberg. mr. babbitt, i would like to go back to the questioning that i was asking mr. scovel about operational errors. and just trying to understand whether you have any purview on this as it relates to this year. are we seeing the same trajectory? do we have any information? is this year better than last? >> no. let's start with -- i'm as concerned with an increase of operational errors as anyone. that's not a good thing.

but the other side of it, i am pleased. we tried to change the culture. we want people to report everything. we now have -- some of the culture changes we've asked our supervisors to be more proactive. and while some of them are excluded from the reporting, often operational errors are duly reported. i'm your supervisor, you make an error. i see it you. i file it as an operational error so there's -- there's no prohibition on both of noting that operational error. >> but you're not saying that's double accounting there? >> no, no. the comment was made that the adsap reports aren't counted and i'm suggesting they are in another fashion. someone else is going to file the report with it. the other thing that i think we should pay attention to is, yes, there has been a dramatic increase but the a error -- let's use the a's. the most serious went from 37 in

'09 to 43. that was 133 million operations and we saw an increase -- i don't like an increase of 7 and i want to know why those happened but that's a very small percentage of error increase. the lion's share of the increase of errors comes down in the less significant, the c's and the d's. these are operational errors. this means that someone who we wanted to have 5-mile entrail spacing had 4.9 for a minute. that's all. we put that margin there for a good reason. we don't want people getting inside of 5 miles but there was nothing at risk here. they simply violated the parameters we put around and i want to know why. so we take this increase data and revise our training. and by the way, as we go forward, we're going to get more increases in error reporting. as we capture more and more electronically, i think mr. rinaldi will tell you when you look at a radar scope that's, you know, scanning 50 miles can you look at it and tell that's 5 or 4.9?

no. electronically you can. and as this tarp-type reporting comes in we're going to see an increase in error and that's a good thing. i want to know why those errors are occurring so we can change them. >> can you talk about the a group, which is the severest -- the most severe classification of error? and what the methodology is? is this subjective? is this an objective process? >> no. these errors are ranked a, b, c and d. loss of separation is essentially what we're talking about. >> an a is? >> the most -- the most significant loss of separation. >> which is? >> well, depending on whether it's an en route environment or final approach, you know, each of these -- for example, over the ocean, we separate airplanes with 50-mile entrail separation because we can't see them. we require them to report where they are. across the united states, they can go to 20-mile entrail

separation and on final approach because the radar is better and they can see each other we can tolerate of 3 miles >> and the increase over this previous year, which of those they were? >> i could get back to you. i don't have them off the top of my head but i can certainly get back to you with that data and each separate event. but my point is the thousands of increase were down in the c's. not significant. they were operational errors. they were a loss of separation. but not the significant losses. that's, you know, the ones that would really concern us. they all concern me. i just wanted to make that disdistinction. >> and do you know if any of them were proportional more operational errors during the midnight shift than other shifts? >> i don't the answer to that but again, i can get back to you. we certainly can get the time and location of each event. >> because i think that's one of the questions that we're trying to ascertain here. we're seeing this increase of

operational errors that is very concerning. >> sure. >> and we, obviously, have this issue of fatigue in the workplace. >> yeah. i would go out -- >> they're both very concerning. >> sure. >> but being related to each other would make us even more concerned. >> yeah. >> and so -- >> commonsense would direct me to suggest that probably not because the traffic drops off significantly in the evenings. these operational errors tend to happen in high-volume type of situations. >> so is the air traffic schedule and fatigue considered a casual factors for operational errors or do you know, mr. scovel? >> i'm sorry. you're asking -- >> do they list casual factors for each operational error? >> when faa launches its investigatory process, subsequent to each operational error, there's a series of questions that are asked. we believe that those questions

need to be better refined and the data needs to be much more precise. for instance, i referred d factors in the chicago area. air traffic control facilities. and in reviewing operational error reports at that location, we were looking specifically for the degree to which fatigue was accounted for in the investigation. and we found in too many instances, a cursory description of what the controller had experienced that might lead an observer to think he might be fatigued. for instance, the report form will ask what shift? that's entirely relevant. the controller in some instances reported simply rotation. it didn't indicate which shift. it didn't indicate which day in the 2-2-1 rotation. with better attention, we feel, for management and a better list of questions to begin with, that

will yield better data. better data with proper analysis will yield better corrective actions. >> thank you. thank you. chairman rockefeller? >> thank you, chairman. i think it's only fair that you get to talk. let me ask you a couple of questions. number 1, this has not been answered and i'm ashamed i don't know the answer myself. please tell me that an air traffic control person cannot hold two jobs during the course of the day? >> it's not prohibited. and under the imposed work rules of 2006 and payrolls of 2006, many of the new air control traffic controllers were holding two or three jobs to meet the pay. and i applaud the controller and the secretary of transportation for putting a lot of focus on getting us back to a fair collective bargaining agreement. and i'm not sure what the number is, if anyone is holding two

jobs now at this point. >> you said two and sometimes three? >> sometimes three, they were, from 2006 to 2009 to make ends meet. >> that's stunning to me. because i think dr. belenky can do all of the magic he wants, but he can't overcome that one. and i'll come to you in a minute, sir. but that's an enormous statement. it's an enormous statement. to me that's like asking for trouble. >> fatigue is -- >> your response is, well, they don't have any choice. they've got to make a living and they've got mouths to feed. that's where we again get into the question of the budget not affecting this. safety comes first. well, the budget is going to affect this. it's going to affect pay increases or nonpay increases. just like having -- not having next gen, makes people lives much more complicated. on the other hand, it makes it

much better because they can see farther out and have much more accurate spacing readings. but how -- how can this -- how can this happen? is this just always been the case? how do you make the case that this -- that this doesn't cause sleeplessness or bad judgment? >> well, actually, from the years of 2006 to 2007 we were talking exactly about the fatigue in the work environment and now we wanted to get together with the agency to address this. and that was one of our biggest reasons to get back to get a fair collective bargaining agreement was because we saw these new hires come in with a 30% reduction in pay. and working at these busy facilities in these high cost of living areas and they were waiting tables and doing everything they possibly can holding down as many jobs as we possibly can. >> well, we have a problem.

dr. belenky maybe you can comment. can these work side-by-side and then talk about safety. >> well, they can. performance is dependent on sleep in 24 hours. total sum sleep, however you split it, divided sleep is good. it can be fine. if total sleep in 24 hours is okay, then you probably are not so concerned about commute time or second jobs. it's when it cuts into the sleep. there are ways of directly measuring unobtrusively monitors that you can see actually track people's sleep/wake history unobconstruivelily. again, that would probably be all right but again -- >> with all due respect, i mean, you're talking, i think, a little bit from a lab point of view. >> absolutely. >> and in the real world of

being in a control tower, people aren't going to divide up their sleep very well, i wouldn't think. maybe i'm wrong. maybe both randy and i'm sorry director babbitt and mr. rinaldi can comment on that. i mean, i think this is a very big issue. >> fatigue is real, as i said in my opening statement. we've been wanting to address this for many years. and i applaud the administrator for putting a work force together, a task force to address it. we've come up with 12 recommendations. we believe all 12 of these recommendations will help mitigate fatigue in the work environment. and as i said earlier, the new collective bargaining agreement is fair. and it has gotten us back to, although not yet in 2012, we'll get back to the 2006 pay bands which has taken some of the stress off the new air traffic controllers that don't have to have maybe two or three jobs anymore. we're not there yet.

we are getting there. so there's a lot of things we're addressing there. but the 12 recommendations that are built on science, and it's not -- the union says or the faa says it really is a conglomeration of science, scientists from nasa say this will help fatigue in a work environment and this is one of the things we're really pushing for. >> work to be done. thank you. >> senator thune, do you have a second round of questioning? >> well, just a couple of things, madam chairman. and, mr. babbitt, following this string of sleeping controller things, the ceo accepted responsibility and resigned. that's a critical position, obviously, at the faa. how long before you find a replacement and what is the type of skill-set that you are looking for? >> yes, it was unfortunate. mr. kirkowski was a professional and i've known him for a long

time. he had an excellent background and reputation. we are starting the process now. i couldn't tell you in exact times. sometimes the folks that you like to have would not be as interested in taking the job as we might want them to be. certainly this is a job that requires a lot of operational experience. this network is not unlike a large logistics network. this is a very complex operation. there are just the operation itself. you've got over 500 facilities that are manned with people on 24-hour many of them the vast of them on 24-hour schedules. they have unique skills. they move. they have to be trained. the operational side of it, introduction to this system is, obviously, the new techniques coming with next gen, new procedures, how do we maximize those. how do we prioritize those? so we have right now a set of criteria that we're looking at. we're reviewing it within the department of transportation. and we're going to start our

search very quickly. now, we have -- the good news is in the interim, david gristle, who was chief counsel to the faa -- david is a seasoned professional. 24 years of continental airlines. he has a lot of experience in big operations. and i saw a lot of transformation at continental airlines. he's familiar with networks. and i think he's doing a terrific job. but that's -- he would rather go back to being chief counsel, i believe, than the coo but he's doing a good job in the interim. we've got a lot of good people in there. so my hope would be within the next few months. but it's hard to say when you're trying to recruit someone. >> accountability is important. but one individual is not solely responsible for these incidents. any other personnel changes that you believe will emphasize the change and approach throughout the rest of the management work force? >> yes, sir. we have. i mean, we have undertaken some -- some of them pretty dramatic management changes. we've got about 10 different

areas where we have taken the leadership and in some cases people thought it would be better to move on and do something else. we clearly have some cultural changes to make. one of the reasons that paul and i were on the call to action was clearly to re-enforce professionalism. as senator rockefeller mentioned, you know, we can't regulate this. i can't regulate professionalism. i wish i could. but i can't. but you can call upon and the vast majority of the air traffic controllers are very proud of what they do. they have great respect for what they do. and we called upon them to help mentor people. sometimes you see someone doing something less than professional. speak up. it's your profession. and we really carried that message to them. that they need to be helping us police the professionalism. someone can have 16 hours of rest in terms of, you know, what dr. belenky thinks is rest but

we found out they played 36 holes of golf that afternoon. that's not professional. you can't -- i don't care how much sleep you had. if you didn't use that sleep wisely and take advantage of your sleep opportunities. so these are the types of things -- and i'm very pleased of the professional standards group that's being built is addressing these because some of this stuff you can't do top-down. you have to have it from the bottom up. and they're inspired to do it. it's a proud profession. they're not happier about this blemish than anybody. >> right. >> let me ask just a general question, too, because you've implemented the nine-hour rest period. i think the i.g. had recommended 10. and the atca recommended nine-hour rest shifts between day and night only. maybe why the recommendations were chosen and maybe for the rest of the panel and mr. rinaldi, is that satisfactory? does that rest period -- is that something you feel would be the

most effective in mitigating fatigue? >> we -- one of the 12 recommendations was that the nine-hour break between the evening shift and going to what we would call the quick turn to the day shift -- that was backed with science and said that would give us an extra hour of sleep in our sleep bank so to speak as we were rotating through our shifts and that was backed with science and one we recommended. the extra hour in between -- i referred to the scientists here. the extra hour between the day shift and the midnight shift -- because you're starting your shift later in that deprivation period of midnight to 6:00 in the morning when your rhythms are expecting you to sleep, you know, you're really focused on falling asleep at that time, that we -- we don't support it. we're working with the administration to show if science supports mitigating the fatigue, we're 100% on board. if 10 hours is better than 9

right now it shows 9 hours has the most benefit in between shifts than 10 hours. and if there is 9 hours are supported from a day shift to a midnight shift with science, we will be 100% behind that. right now it doesn't show that. it shows opposite because you're starting your midnight shift in an area where -- and you're working more hours in that dangerous period. >> i agree with mr. rinaldi. it's a very tricky issue and it depends critically on the timing of the sleep opportunity. if you place the sleep opportunity that mr. rinaldi indicated in the mid -- early to midevening, that's the forbidden zone for sleep. your body temperature is rising. all your systems are telling you to be awebb, alert and it's very difficult to sleep during that time. not hours from 3:00 in the afternoon until 11:00, 12:00 in the evening is not going to help very much because it's not going

to be a useable sleep opportunity. in contrast, nine hours from midnight to 9:00 in the morning, you'll sleep well. and capitalize on that sleep opportunity. so it isn't just the duration of the opportunity but key is placement with respect to the sir cade unrhythm. >> mr. thune, if i may you referred to our recommendation which states back to 2009 of the fatigue report out of the chicago facility review. at that time we recommended 10 hours between shifts. and it was our understanding at that time that faa was about to change its internal order to specify 10 hours as opposed to 8 hours between the shifts in the 2-2-1 rotation. in effect we endorsed that change. since then, and mr. babbitt, and mr. rinaldi have both referred to the work group that's recommended a move to 9 hours, look, we're not whetted to 10

hours. we would gladly defer to medical science on this question. but we think that the agency would be well served as well to be guided by the science when it comes to naps or rests during a controller's work shift as well. it will be cold comfort, mr. thune, for the family of a victim of an aircraft accident if it's determined that it was due to controller error. and that the controller was fatigued at the time and had been deprived of opportunities for naps or for rests. >> thank you. thank you, madam chairman. >> senator lautenberg do you have a second question, a second round? >> i ask unanimous consent that my full statement, opening statement, would be in the record? >> no objection. >> i want to ask mr. babbitt a question, 2006, a former faa

administrator informed me that that newark liberty traffic control needed at least 35 controllers to move traffic safely. now, i don't know that it was intended to be full performance people but right now there are only 26 certified controllers. many in the tower with 8 trainees. and when will the faa address this to staff these control centers with controllers. >> i don't have the numbers available to me. my understanding today is that the range -- we do, in fact, try to staff to traffic. so traffic flows change sometimes. and, therefore, you might want to increase staffing someplace. sometimes you have the opportunity or traffic follows off someplace. a good example recently would have been cincinnati where a merger forced a move in traffic

to other areas so traffic in another city went up dramatically and traffic in cincinnati went down. it takes us a while to migrate the people back and forth. so specifically my understanding today, and i could get you the absolute staffing numbers that we have, but we think we have a floor of around 28 and a ceiling of about 38. >> let me ask you this, and newark liberty is a complex airport due to high volume of flights, congested new york, new jersey air space and congested runways. so what have we got to do to provide the numbers that we need for newark when -- my understanding is that 75% of the trainees don't make it through the program? so when you have a dropout rate like that, or an incomplete rate like that, what do we do to get newark up-to-date? >> yes, sir. i think i made an earlier

observation that we had difficulty with the previous agreement, the collective bargaining with the air traffic controllers. we were able to attract seasoned controllers into complex facilities and that is changed and the numbers you're looking at, those are old numbers. we've had dramatic improvements since then. now we're able -- if we needed to fill spots in, for example, newark, we would be able to advertise that and someone might -- a seasoned controller might come from a smaller facility and very easily upgrade into it as opposed to a new hire. and the fact that we had to put new hires into some of those facilities, led to an exceedingly high washout rate which was unfortunate but we cured that today. >> do we still have increased salary for high cost areas? >> yes. yes, sir. >> is that still in place? >> yes, sir. >> so if someone shifts from a less busy airport to become a

fully trained controller at newark, that means they automatically will get an increase in their salary? >> well, if they had come from la guardia, probably not. but within the metropolitan area, it would be probably the same. i would have to look in particular. >> we try to keep the bistate wars co-op -- [laughter] >> mr. rinaldi, the house republicans have threatened to cut back, faa funds to 2008 levels. what impact would these proposed cuts have on our ability to hire and fully train new air traffic controllers? >> that would be a big concern of ours to go back to 2008 levels for the obvious reasons that as mr. babbitt said, we -- from 2006 to 2009, we lost somewhere between 4,500 air traffic controllers and in the last five-year period they hired somewhere over 7,500 air traffic

controllers. it takes five to six years to train somebody to become an air traffic controller and their training does put a lot of stress on the program. we are -- and a lot of our facilities are above the 25% optimal trainee to cpc certified professional controller level. so if -- if we went back to 2008 numbers and we looked at not hiring and continuing to hiring the fear we would have -- currently we have another 4,000 air traffic controllers are able to retire or eligible to retire. we have another wave of requirement. we haven't caught up from the first wave of retirement we experienced in 2006 to 2009. >> i close with thanks to all four of these people who do a terrific job and their teams do a terrific job but we're going to hound you death to even make it better if we can possibly do it. thank you very much. >> senator warner. >> thank you madam chairman. thank you for holding this

hearing. and i want to commend mr. rinaldi and administrative babbitt for some of the actions they are taken. i think we were surprised from all these incidents but i'm glad to see you've been working further together. this is not an area that i had a lot of knowledge about. but i remember a meeting i had with mr. rinaldi back in 2007. and i don't think i in all my time in public service had more of a frightening session kind of getting air traffic control 101 in terms of the potential wave of retirees. the challenges of attracting new folks, the ability to get through training periods, the ability to attract people to stay in this profession, the antiquated equipment and the need to move to next gen. and, you know, i want to again echo what senator lautenberg said. i think you all do a good job. we need to constantly be vigilant.

but, you know, i guess, i'd ask you first if there's anything else -- i mean, the remarkable thing is, a lot of the things he said in 2007 have all kind of come to pass. and i don't think a lot of our folks around the country would know, you know, kind of how close to the edge because there's been, obviously, a massive transformation in the 1980s when a whole new people were hired and they went through the cycle. i know i missed the first round of questions in your first round of testimony, but if you've got any other -- at least this moment advice or admonition, hopefully, not any more predictions similar to what you made in 2007 that? >> thank you, senator. unfortunately, i think that there's a lag in the system. and i didn't mean in my opening statement to say worry not concerned about operational errors. we're certainly concerned about operational errors. what i was trying to refer to is

the 2006 to 2009 and even years before that, there was a culture within the faa's covered up, hide it, management's incentives were tied to it. and we weren't getting the information to address the safety concerns in the system. and that's why i applaud the administrator for really putting a just culture in place to address the safety concerns of the system. unfortunately, i think we're going to see an increase in operational errors as we talk about tarp, of better reporting, open reporting. we're going to start to really see where there are possible implications of safety in the system. and i just -- i look forward to working with the administrator and working with all you to say, yes, we have a concern here. we need to address it. so aspirations grow, as fatigue is a real problem in our work environment and we look forward to implementing those 12 recommendations, to mitigate as much as possible, and i don't

know if you can ever eliminate fatigue in a high stressed 24-hour a day profession like air traffic control but you can certainly try to mitigate it to the point that our cognitive skills are not impaired. and that's really where we look to go. so that we're embarrassed by what has happened and we're proud professionals and we don't like any of the nonsense that is going on and we want to make sure it never happens again. i think the first positive step is to address these 12 recommendations and to really address the safety concerns with the operational errors. >> and do you both feel you've got now the transparency and the training processes in place to make sure, you know, we don't have this kind of cliff effect of retirement that we've run into in these last two years? >> no. senator, we now reached -- the retirement rate is literally half what it was three years ago. we're down to a steady state. any corporation, business with, you know -- it's been in business long enough, it gets to

the point where you've got retirements that, you know, 5, 6, 7% a year. that's what we're living and that should be and we can train to that without any problem and not overburden the system but we were overburdened. there's no question. we were training twice that many of controllers for three straight years. it put a huge burden. it put -- you know, we have a finite number of training facilities. when you put 30 and 40% trainees into a facility, who trains them? the other controllers train them and so it's a big burden on them but now we're getting down -- we're very comfortable in the 20 to 25% range. and that's where we are today. so i'm very comfortable there. >> well, again, i appreciate the collaboration both of you are going to work on and again, mr. rinaldi, i just wish all those things you said -- the rest all of them don't come true as well. let me just administrator babbitt this is going to come out of left field but one of the things i've been very interested in as well is making sure we get additional spectrum out into the

marketplace. and a number years back in part of mobile satellite spectrum there was an award to a company called light squared. it potentially would be another mobile broadband competitor and there were certain questions about interference with existing gps systems, you know, some of these concerns seemed to have been raised now five or six years after the grant had been made. and nobody likes to give up spectrum. but some of the technology -- folks that i've talked to says there are ways that we can make sure there is another viable broadband competitor out there and still make sure as we move into next gen that the -- there's appropriate gps protection for -- that are appropriate next gen gps services are going to be used and they will not have the interference and i would hope as the fcc moves through this process that you'll participate

and not just have the approach that says forbidden -- you had this spectrum for six years and now all of a sudden we're going to say there's potential interference here. >> yes, sir. we're actively engaged in, you know, working through and trying to find a solution there. one of the problems, of course, was the original intent of light squared was to use satellite signals. back in november they began to come up, you know, with the idea that they could enhance the signal by boosting it on the ground with terrestrial antennas. very powerful, literally 100 times more powerful than the original forecast from space. now, there is a technical solution available but i have to tell you it would be not without consequence. the technical solution, remember, we would have to design the equipment to filter the interference, certify it, reinstall it. it has weight -- there are consequences to putting new equipment in airplanes. to do that would probably be in the 5-year at best range.

and then you're talking about equipping airplanes that have been designed now for the last 15 years to accommodate adsp, automatic dependence surveillance broadcast equipment where the airplane takes its position and develops it from a satellite and then broadcasts that. we have about 5,000 commercial airplanes that use that equipment today and about 140,000 general aviation airplanes. >> clearly, anything would have to require a transition period but i do -- would like to -- and my understanding the fcc is going to come out what some of those costs would be. i hope you will actively participate 'cause at some point we're going to have to weigh the policy implications on it again. >> yes, we certainly will. >> thank you. >> off-topic i want to thank you for what you all have been working. >> i apologize for being late. i was chairing a judiciary hearing and now i'm in the unenviable position of being last but it means all questions have been asked but not by me. i first wanted to thank all of

you. i was especially impressed by your -- your comments and exchange with senator warner, mr. rinaldi, the pride in your profession and how these recent events have been so disappointing and the work that's being done to fix it. as you all know, our commercial aviation system carried nearly 800 million people last year. many of them through major air traffic hubs like minneapolis/st. paul international airport. and we know that our accident rate has gone down over the years. but there's still issues we know and we have some of our traffic controllers falling asleep, sleep deprivation among air traffic controllers is a serious issue and i appreciate the chairwoman for having this hearing and all of you for taking this on. now, mr. babbitt, the faa has recognized and addressed the issue of fatigue and the new staffing guidelines required two controllers in towers during night shifts and 9-hour windows between shifts.

have you been able to quantify the effect of these new staffing policies on operational errors and runway incursions since they were implemented or is it too early? >> i believe, senator, it's probably a little too early. we haven't seen -- part of the problem is these towers or whatever the facilities were 27 towers, 3 tracons that had single person manning. the fact they had very low staffing was very little traffic operations for those hours so we wouldn't expect much to be in the way of operational errors there but it is too early to tell. >> well, i know there was a spate of reports of one time period about people falling asleep. but there seems like there haven't been at least in the last month or two since secretary lahood and others have come out, do you have any information on that? >> well, we did -- we instituted a number of changes. you did miss sort of our review of putting 9 hours --

>> no, i know the changes. i just wondered if you had reports of others falling asleep? >> well, i called for very candidly i called for a top to bottom review and we did find some that happened earlier. now, i'm sure if anything back further i'll find more. but we did find two that happened in january. you know, both instances of people either observed with their eyes closed or observed sleeping, you know, neither of these was a good one. one in los angeles and one in fort worth. you know, we're just adding that to the statistics. >> and i know when you visited me last week we talked about this but the rest periods between shifts and double staffing may require additional air traffic controllers. does the faa have an estimate of how these new policies could affect the demand for controllers? >> well, in this case we're talking about 30 total out of 15,000. now, that has a consequence. but we're also looking and working with the controllers --

there are ways that we could, for example, provide the same effective result having two people together in a tower as an example. we often have -- where we have facilities where we have someone in a tracon or radar facility downstairs and someone in the tower upstairs. each of them alone. well, we can put a console upstairs and let the person work radar up there. it's dark at night anyway. so they can work the facility and now there are two people at no cost other than the one-time installation so we're looking at things like that. >> you'd have someone else in there but they're working -- >> yes, they would be doing the same work they were doing in a different location. we'll just put them in the same spot. >> i get it. >> thus, saving us the extra person. >> uh-huh. and then one last question. the fatigue work group composed of representatives from the air traffic controllers association and the faa made a set of 12 recommendations. that if implemented would address and mitigate the issue of fatigue among air traffic controllers. do you know the status of review

for this proposal and do you expect to implement the recommendations? are there other recommendations instead of double staffing and longer breaks between shifts that could be implemented? >> yeah, there's a number and we have already implemented several of the pieces. it came right out of the fatigue study. we're in discussions right now with nabka we're going to review and see what makes the most sense. in addition to the faa and nadka, we had some human factors folks and people who introduced medical science to help us better understand fatigue and better understand how to mitigate it. so all of those are going to be in review. some of them will require, you know, memorandums of understanding or modifications to the collective bargaining or add other shifts or something like that but we had excellent cooperations with our and nadka

going forward. >> thank you. mr. rinaldi? >> thank you. they are a good start but they'll have to be implemented, tested and evaluated to see if we actually reached the goals in which we're trying to do. and there might have to be more, the scientists and the work force will continue to work together to see if we need more time in between shifts or whatever might happen. and actually test controllers with wristbands and see exactly what -- if we're really addressing the fatigue. more importantly, and mr. babbitt and dr. belenky touched on it is the education factor about fatigue. we have about 5,000 new air traffic controllers under the age of 30-something that, quite frankly, when we were all 30 we thought we were invincible and we were all in college and we pulled all-nighters and did our tests and did everything but we really need to make sure we address fatigue and address it real and identify it and make

sure that we do have proper periods to sleep and we use that to sleep and rest. >> okay. very good. well, thank you very much and thank you, madam chairman, for having this hearing. >> thank you, senator klobuchar. i think it does wrap up our hearings. we have discussed a variety of issues of training, and the percentage of trainees that are acceptable of scheduling and changes to scheduling getting more details on the operational errors and the meaning of those operational errors and obviously the implementation of recommendations. so this committee is going to play an active role on oversight on all of those issues. i can't say we're taking a legislative path at this moment but i can tell you we're not ruling it out either. we'll continue to be diligent until we feel we have improved the safety and continue to implement those safety recommendations. so thank you all very much for this hearing. >> thank you. [inaudible conversations]

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>> earlier this week, house budget committee chair paul ryan and white house national economic counsel director, gene sperling, spoke about the house republican and white house budget plans on the fiscal deficit. the white house is not producing a plan that comes anywhere close to fixing this problem. while mr. sperling noted the discussions. they were hosted by maria bartiromo and this is an hour and 10 minutes hosted by the

peter peterson foundation. >> we are talking with two of the washington authorities on economic policy, paul ryan and gene sperling, the director of president obama's national economic counsel. before i bring chairman ryan out, last month, the chairman introduced a chairman to reduce long term deficits without raising taxes. the plan proposed significant changes to the medicare program, medicaid, as well as other cuts in federal spending. some people have hailed the program as quite positive, others have criticized it. let me bring on mr. ryan soldiering on, and he'll talk about that plan. congressman ryan. [applause] >> thank you.

got caught up with president clinton. >> yeah, saw that. congressman ryan, great to have you today. we'll talk about your plans and then get gene sperling's white house plans. your plan to cut deficits include cutting spending by $5.8 trillion. you do not accept any tax increases on the revenue side. reducing budget deficits by $1.6 trillion. >> 4.4. >> over the ten years, not included increasing any extra revenue from tax increases which is from gene sperling's plan. the proposal calls for restructuring the medicare and medicaid. let's start there. walk us through what medicare and medicaid changes look like over the 10 year period and beyond. >> sure, sure. over the ten year, no changes to medicare. medicaid, we're taking a page

out of the successful welfare reform policies president clinton signed into law, and we are copying those strategies to other parts of laws in medicaid particular. we are proposing to block rent the program back to the states and grow the program at a more sustainable rate. medicaid is broken. pouring money into a broken system we proved doesn't work. more importantly, from talk ugh to dozens of governors, we give them the freedom and flex the to customize medicaid to meet the need of the population. in wisconsin, there's a better way of doing than in new york or nevada. we want to propose the states with the ability because they manage the program, but they get a lot of federal strings. we have a successful program that takes years of getting labors, and let them customize it to meet the population needs. medicare, we propose, and this is a little lost in the tv ads

you hear these days, but we prepare not to change the benefits for people above the age of 55. more to the point. unlike the president's health care law that takes half a trail from medicare, not to extend the solvency, but spend it on the president's health care law, there's a board called the ipab to control price controls. that affects current seniors. we heard startling facts what that would do. we get rid of that, any money from medicare goes to make it solvent. people 54 and below because cbo says medicare is insol vent in nine years. the trustees moved up by five years. it's collapsing. in order to keep the promise to current seniors, people in and near retirement, you have to reform it for the next

generation. those of us below 54, move it towards a premium support system, the same system president clinton recommended. it's an idea with bipartisan support in the past. it works like this -- medicare negotiates with insurers with guaranteed options from which seniors choose from. medicare subsidizes premiums like this -- more for the poor, more for the sick and middle income person rather than the wealth person. more for those who have less money. doing it that way, hair necessarying -- harnessing the power of choice and competition and subsidizing those with more with less makes it secure and gives us the ability to keep the program as its designed for those who are in retirement and ten years away from retiring. >> we want to talk about health care and the other areas that require delving into defense

spending and tax reform and other federal spending cuts that you've proposed, but let's stay on health care. i have a follow-up on seniors. the cbo says your health plan increases spending for a typical 65 medicare beneficiary by 30%-40% in 2030. the private plans to replace medicare under your plan have higher administrative costs and less leverage than the current program. why do you think shifting medicare beneficiaries to a fragmented system of private payers reduces cost? >> experience shows us it's working. i disagree with the premise of that question. number one, number two, measuring any medicare reform plan against the status quo is to measure against a fiscal fantasy. there's tens of trillions of money and it's growing at an unsustainable rate, the biggest driver of the debt, president

obama acknowledged that with his cap on growth rate of medicare using the ipab. we do it a different way. we have experience. medicare was in 1965, it pays -- for brain surgery it's a price controlling system that dictates the prices for bedpans and brain surgery. the point we're saying is use choice and competition and have the plans compete against each other for beneficiary's business in the future. where's the experience? this is how the federal employee plan works and the drug plan works. move it to a system like the drug benefit plan and what has time shown us? this is a plan that came in 41% below cost projections. medicare drug benefits that work this way that we propose cost 41% less than we originally thought it would because of choice and competition.

it's popular. here's the key, the senior gets to choose. if they don't like the plan, fire that plan, go to another plan next year, and they know that, so they compete on quality, on price, and using those market-based principles and when the power comes to a senior, not a government bureaucracy, helps us improve this system and lower costs. now, monopolies don't work i say whether it's an insurance or government monopoly. we want the power in the hands of the people and not bureaucrats to determine how this sector of the economy works. >> how do we know doctors and hospitals are willing to treat medicare patients under your plan if their reimbursements are lower? >> look at the current status quo. there's a new report saying 40% of medicare, of providers stop taking them under the status

quo. under the president's plan, they think more providers will stop taking patients because of price controlling. medicaid is a problem in the same vain where providers take less and less medicaid parents because of under reimbursements. under this program, we're not saying price control, but choice and competition. providers are rewarded for exkeeling, innovating, and creating a better service at a lower cost. we want to have the patient-doctor relationship be the driver of the health care system, not a government price control system. i argue that providers are under more stress and more strain under a price-controlled system than under a market based system where the power goes to the person to select among competing providers for their benefits. >> moving on to tax reform and social security, but one more question. the medicare plan could more than double the out-of-pocket

costs. it is reasonable to assume seniors can afford the cost increases? >> a couple things. it fails to take into consideration the extra $7800 we're talking about adding to low income seniors' benefits. we're saying protect those who are low income by covering the out-of-pocket cost. as people get sicker, increase the payments to stabilize the premiums, as people are wealthier, don't subsidize them as much. the other thing i say is it's comparing medicare to a fiscal fantasy in which the current system is unsustainable growing at unsustainable rates that will crash the system. the question is what are the reforms putting in place to get at the root cause of health inflation, make the dollars stretch further, to inject competition in the system and stretch the dollar further, and then subsidize people more who need it more and not those who

need it less, and sioux it's really kind of an incomplete comparison to suggest that's happening to everybody. yes, wealthier people will pay more in the future, but more participantly, there's -- importantly, there's only so much money to go around. we have to save medicare so the next generation can count on it and subsidize people who need it the most, and not the people who need it the least. >> we have questions from the add yengs and -- audience and twitter on this plan. let me ask you about tax reform. president clinton talked about the fact that it is very difficult to see how this plan would work without any new revenue. you are against raising taxes, and some people say that's really an ideology. >> yeah. >> that you are just against in the tax increase. how does this work without increasing revenues. >> it's not ideology, just economics. here's the missing ingredient in this conversation.

if we allow this debt conversation to be one of mathematics and green eye shade, the missing ingredient is economic growth, job creation, the two basic things to accomplish here, it's spending cuts and reforms and economic growth under the president's plan, the top tax rate on individuals goes up to 44.8%. we don't agree with that. we don't think we should be raising tax rates. we don't think we should be taxing our employers and our job creators more than the foreign competitors tax theirs. we're not talking about cutting tax revenues, but tax reform. just like the fiscal commission recommended, broaden the tax base, lower the tax rates for a fair tax system with an eye on economic growth. do we want more revenues coming in to close the fiscal gap? of course we do. the best way to go after that is economic growth and job creation, cranking up tax rates does not accomplish that.

it's going to be counterproductive because i believe in this era of global competition, it makes the economy much less competitivement the jobs where i come from come from successful small businesses filing taxings as individuals. when you bring their tax rate along with their state taxes above 50%, that's putting a chilling effect. on the corporate side, we have the highest tax rate in the industrialized world. the average is 25%. ours is 35%. some companies have a low effective tax rate, others have really high ones. clear the clutter, all the tax expenditures, lower tax rates on everybody with an eye towards job creation, and under the guides we're talking about, the person and the business that make the same amount of income should pay the same tax rate. that's not the system we have today. we need to clean it up with an eye towards economic growth, and with economic growth, you get better revenue growth. >> well, what are some of the

low hanging fruit if you will in terms of tax expenditures that can go away and ultimately lead to expaneledding the brought -- expanding the broader base? ? this is what the committee is intending to move through this summer. we're in the midst of doing our research in the ways and means committee to do just that. we're talking about taking a play out of the fiscal commission. our revenues targets are a little lower than the fiscal commission's rivalling targettings. we have to have a conversation with ourselves and congress and the country about which of the taxes should be going away in exchange for lower rates? i would simply say for those who use class warfare to describe these things, the people and the companies who use tax shelters are those in the top brackets. that dollar is taxed at zero. get rid of the shelter, you tax that money, and so you're just having a broader base flatter

simpler system and more people are actually paying taxes on money they were not paying taxes on before. we think it's a smarter way to go. it puts us in a better position in the global economy to lead and create jobs, and i'll finish what i started with. we got to keep an eye on international competition, and when we tax ourselves more than the foreign competitors tax themselves, we cost ourselves competitively, and you can't fix the problem if you can't grow the economy. >> this plan did not talk about social security, restructuring social security. you talked about it before, but it is not part of this plan. i wonder if you have dealt with social security, but perhaps you would not have to have some of the other spending cuts that you're talking about on education, food stamps, cutting services on the people who desperately need the services. >> so, if we had done a social security plan, and i have several bills in the base with social security, and i believe

projecting longevity and the structure, there's still not accumulated sievings in the window because like medicare we would have exempted people 55 and above from chinks. the reason there's a trigger in the bill saying social security is insol vaunt, which it is, the white house needed plans, and we thought we would have a better chance of getting a social security agreement this summer with the partners on the other side of the aisle. we believe if there's a social security plan out there, it's too tempting for pelosi to demagogue it like they are on medicare. we figured they would do that on social security and make harder to get an agreement. we made it such to is a higher likelihood of reforming social security because i fundamentally believe if we reform one of the unsustainable entitlement programs, that helps us with the credit markets and economy, but we don't have interest on the other side of the aisle to do that.

with respect to the safety net programs you talked about, we're bringing spending back to where it was a couple years ago, growing them more sustainably. essential welfare has steady increases, but at a sustainable rate. the way we reform the safety net is to take a page from the play book of the 1990s, the successful reform president clinton signed into law, take those ideas and apply it to other programs. there's dozens left that were unreformed, and the idea we have behind the safety net reforms is we want to have a safety net that is there to catch people who are slipping through the cracks, to help people down on their luck and people who can want help themselves. we don't want it geared towards keeping people on welfare, but geared towards getting them back on their feet on the lines of self-sufficiency. this is why we have job trains programs in the career scholarships to go to workers in displaced industries to go back

to school, get new skills to get back into a career on on their -- and on their feet. we're talking about saving and transforming the safety net to get people back to work, the retirement security, saving these programs, paying often the debt, and economic growth and job creation. those are the four things we are seeking to achieve with the budget. >> defense spending -- where are the opportunities to cut defense? >> i think secretary gates has done a very good job. he's going through and identified $178 billion in cuts that he believes could occur in the defense. we agree with that and accepted those cuts. he took -- he recommended taking $100 million to go to the troops, to modernize their weapons and equipment needed and send the billion towards deficit reduction. that's what president obama proposed on his budget. we agree with that. the other point -- republicans are of a mixed opinion on this issue. we believe you have to -- you

have to take spending cuts to this agency. you can't put $700 billion to an agency and not expect waste to occur. we wanted to make sure we did not dodge taking spending out of dod to deficit reduction. we do that, but having said all of that, i would love nothing more than a budgeteer to budget. we are not at peace, but at war. that's only so far you can go before compromising the mission and men and women out there serving our country, so we don't have the ability to budget for a peace dividend when the world is a more dangerous place, but having said all of that, we cut defense, take $78 billion out of it for debt reduction in addition to the other $100 billion we take from dod to give to the troops. if we wait wait, let this seep

in and inflict pa paralysis in our system, we have a debt crisis, then austerity happens, cuts to current seniors, tax increases slow down the economy. the people who hurt the worst need government the most. the elderly and poor, that's what we want to prevent. the spending is targeted towards those populations. that's why we always say fix welfare people who need it, end it for those who don't. that's corporate welfare, spending, and through the tax code. i believe we have to make a decision about our values. who should be helped the most by government, and who shouldn't in we have to help those least among us, and the sooner you do this, the more we do it on our terms, the more gradual and sensible the reforms are, and the more we procrastinate, the deeper the hole we dig, the more immediate the solutions must become. >> talking to us how you

inenvision governors taking over their own parts of the medicare issue. medicare data shows where the health market works effectively. could they highlight the best market? >> absolutely. medicare advantages shows this. we learned a lot through the program where there's belter market competition. not all states are the same. i talked to several governors who asked us to block rent medicaid because they believe they can make the program work better at a better price and cost if they have more control and flex the in reforming it in their states. talked to mitch daniels, kris christie and several governors wants the freedom to customize the programs because we make them work better. right now, there's problems with the program. on method care, it kind of comes down to this. minute you, it's the biggest driver of the debt in the future with tens of trillions of unfunded liabilities. everybody acknowledges that. the status quo is the enemy of

medicare, it's the worst thing because that means collapse and so does the money go to the government and come down through price controls and rationed care where we have a board of 15 people make all of these decisions, or does the money go through the individual? more for the poor, more for the sick, less for the wealth, and give them power in the marketplace to have competition. do you want a centrally planned system, or do you want a system where the providers, doctors, hospitals, insurance companies compete against each other for our business? to make that work, the person has to be powerful. they is money and rights. you have to clean up the insurance laws. under the medicare reform proposals, medicare does the negotiating with the insurance companies. medicare sets up coverage options from this seniors choose and subsidize those based on need. that, to me, is a far better way to go.

it's the system i have as a federal employee. it's just the way medicare drug benefits works 41% below cost. medicare has a lot of experience this way, and it's a better way to go because it gives us the ability to guarantee that the benefit system as now designed is there for people who now rely on it. that, to me, is a better way to go. a patient-centered system where the patient has the power versus a government-centered plan system where you have to ration prices. price controls do not work. we tried them before. they produce lots of inefficiencies throughout the system and scarcities. we don't want to go down that road. >> one quarter of medicare patients account for 85% of the program's total cost. many of the patients are receiving end of life care, so how will your health plan reduce the cost of treating the very sick people? >> so as i mentioned before, our health plan is a budget, and the

budget resolution is broad architecture, and this is not final legislation. those are the kinds of details that have to be worked out i would think, but in a concept level, people -- you're right about the statistics. you want to have a decision not made by some board, not made indiscriminately by government, but a decision to be made by the beneficiary, the family, and their physician, and you want that decision to be made with all the information, and so when peter welcherson is facing that -- peter peterson is facing that he should make the decision because he's a man of means and people with the means should make the decisions. those who have more should pay more, and in those kinds of situations, there will be price exposure, and so they will discuss these things as families. this is a personal thing. the human person, the dignity, is such an important

overpowering principle we employed in the solutions. the last thing we need is some arbitrary board determine these things. this is something that should be left to the individual, the family, and the physician, and they should make a decision based on all the surrounding factors, and so i think if you're going into an area the government shouldn't go to if you try to just put one size fits all formula on end of care life issues. >> are there any other items that you want to ensure that people understand are critical to getting the deficit down, eventually to a surplus situation? >> i'll make a political statement, and then i'll make a policy statement. from a policy statement, the sooner we do this, the better off we are as a country. gao told us years ago unfunded littles, the promises government makes to americans without the money to pay is $69 trillion. a year ago it was $64

trillionment this year, it's $94 trillion. every year we don't fix the problem, it gets worse, and the solution is that much more painful. politics -- i'm very worried and it's pretty clear these days that and both parties do this to each other, whenever you put out a plan to fix it, the other party uses it as a political weapon against you, and what they do, and in this particular case with medicare, they are demagoguing and distorting this. it's mediscare to scare seniors. our plan is the best, but scaring seniors and turning these into political weapons, what that does is inflict political paralysis. that means nothing gets done and we're further down the path of debt. the politics of this means we need leaders, leadership.

what do leaders do? leaders offer and propose solutions. we have not had that from our partners on the other side of the aisle. there's press releases, ads, and speeches. we have yet to see a solution using numbers that lead up to fix this problem. in a divided government, and i believe this has to be bipartisan, but you can't have negotiations with just yourself. you need to have responsible leaders put ideas on the table. the president created a fiscal commission which i was happy to serve it. he disinvolved the commission. he gave us a budget that didn't fix the problem and gave a speech which still didn't fix the problem, and now there's another commission, the biden commission. we can commission ourselves to death. we just got to get out there and fix the problems. leaders need to put solutions out there that fix the problem and date on how best to fix it

and compromise. you can't get to that point with demagoguery. my fear is political campaign strategies for 2012 seeped into 2011, and we're going back to the corners and fighting this out politically. with the debt limit, my hope is we have a serious down payment on the issue, a serious down payment on spending and debt to buy us more time and space in the credit markets, and if there are things we cannot agree upon, i want to have a civil conversation based on fact on how best the problems. the country deserves this debate. people are hungry for slewses. i tell you, maria, representing a distribute that voted for clinton and obama, i believe people are ahead of the political class. they are sick of the demagoguery, the campaigns. they want solutions. they want answers. they are way ahead of us, and they deserve nothing less. >> we're going to talk with gene sperling momentarily. anything you want to say before

we hear from gene sperling about the president's plan? >> that's a softball loaded question. >> no, what is wrong with the president's plan before we bring out gene sperling. >> it doesn't fix the problem. it's a debt crisis. it doesn't do anything to address the programs. where they dod something which is the ipab, i personally believe that -- putting a board in charge of the things is the wrong way to go. even with all the tax increases in the president's plan, which i think chills economic growth, it still chases higher spending or come close to fixing the problem. if you're going to put up a budget, it better be a budget to solve the problem and get the debt under control. we've done that, nobody else has. >> thank you very much. >> thank you, maria. appreciate it. [applause] >> thank you so much.

our next conversation is with national economic counsel director gene sperling. as i mentioned at the top, he's at the center of the institution on budgets and fiscal policy. no one has a more detailed knowledge of the administration's plan than gene sperling. please welcome gene sperling. [applause] ♪ ♪ >> hi, gene, good to see you. >> thanks, maria. >> you heard the conversation with congressman ryan. how does the president's plan differ? >> it differs because there's raising sense of balance that every category is on the table and there's shared sacrifice when doing fiscal disblip. now, the president put forward a very serious frame work, $4 trillion in deficit reduction over 12 years. it was praised by bowels and simp --

boles and simpson and every value day tore. it's the case that chairman ryan's plan does get to $4 trillion quicker over 10 years opposed to 12, but we think that is appropriate because we want number one, we don't want to face things in at -- phase things in at 9% unemployment in any way that impedes recovery, and it's important as you are trying to control entitlement class, trying to control the deficit, that you don't stop investing in the future in terms of education, research, science, and competitiveness. third, we believe it's more important to protect the fundmental social compact that we see in programs like medicaid aeromedicare, and we think that president put out a very serious plan. it had medicare and medicaid savings of $470 billion over 12 years, over a trillion of

discretionary spending over 12 years. it had a trillion dollars of revenue, so it really was a plan that did 4 trillion and 3 trillion for every dollar of rev new increases, but i want to hit the shared sacrifice point. here's the news, nobody likes deficit reduction. the way deficit reduction happens in the country is when everybody dislikes it in a kind of equally in a way they think is fair, so it's very important. if you're going to go into programs like medicaid and ask for savings, if you're going to squeeze on discretionary spending and ways that deal with research and science, if you're going to do these things and ask for sacrifice, people need to know we're all in this together, so when we talk about things like why it's important not to permanently extend the high income tax cut, it's not just the numbers or the extra

trillion dollars, though it's important. >> is it a trillion dollars? >> it's a trillion dollars over ten years to extend the increase in the estate tax exemption and the upper income taxes in dispute, one thl. the reason that's important beyond the trillion is look what's happening on the medicaid side. you cut $770 billion. you can't say to anybody who would be affected by that that we have to do that, that we have no choice. we had the greatest financial recession since the 30s, inhitted a -- inherited a huge deficit, and we have to dee with this. all the savings are unnecessary if you are not funding the high income tax cuts. it's important for having the kind of moral power to ask everybody to sacrifice, that you include revenues in the package and particularly revenues on the most fortunate. it's not about class warfare,

but shared sacrifice and having the moral authority to ask everybody in the country to be part of an effort that is going to squeeze us a little in the short term and medium term, but for the benefit of restoring confidence in our long term economic future. >> i want to ask about the ipab mechanism, but let's stay on taxes for a minute. >> sure. >> you heard chairman ryan as what he sees add implications raising taxes on anyone and it's about economic growth. talk to us about that. you said it's shared responsibility, but we have so many tax expenditures, and many people agree on both sides of the aisle that real tax reform is required rather than necessarily taking the highest earners up and taxing the way you talk about. >> well, three points.

number one, i don't think anybody engaged this a serious discussion about our fiscal and economic future should make claims that what happens to the marginal tax rate at the top is the sole explanation of whether we grow or not. i don't think that's a good idea, but i think chairman ryan and others should not make it from their perspective because if you look at that in that similar price tick way, the evidence doesn't look too good over 20 years. everything he said, i heard nine million times in 1993 and the next years were eight strong years of the 20th century. we cut taxes significantly with an administration that did not have one net private sector job growth. now, i am not claims that that is that simple. that's not my claim. i'm just saying i don't think it's wise for people on that side to make it because it's a simplistic argument and history

doesn't hem them. the truth is that you are doing this as part of an overall fiscal discipline package. if you do that, you will create competence in the country, competence for people who make long term investments because they believe we have the political will to compromise and do things that are significant to get our fiscal house in order and live within our means. that's important. i really want to point out how isolated the house republicans are in their line that it's no -- it's just a spending problem, not a revenue problem. i mean, that is good message discipline, but not good fiscal discipline. if you look at any serious effort, 1982, after ronald reagan's tax cuts hurt the deficit too much, ronald reagan was part of a tax raising effort in 82. in 83 on social security, on 86, they raised taxes and cut others

as part as tax reform. in 1990, president bush and speaker fully, in 1997 republicans agreed to maintain the tax increases in 1997. people talk about cameron in the u.k.. cameron has about the same exact proportion of revenue increases in his budget as we do in ours. it's serious people doing serious discussions do not take an absolutist position that you can want have a penny of revenue. it is never -- none of the bipartisan plans, none of them take that position. ten former cea chairing including marty feelstein and said you need a mix of revenues. 24 is holding back our chance to do something major because you can't get the sense of shared sacrifice if revenues are off the table number one. number two, it's hard to ask other people to do things,

perhaps on entitlements they don't want to do or haven't wanted to do if there's no willingness to compromise on the revenue side, and third, you know, there is a disconnect between what chairman ryan says about which i'm sure are his sincere intentions and what the impact of his plans on medicaid and food stamps have for millions of not so fortunate americans #-bg -- and i think the reason that happens is because he's in a box not to be willing to do rev new, it forces them to do very severe cuts that i think if people explored they would not be proud of, and that goes to the last issue which is we were -- we are very open to having a tax reform plan where you cut tax expenditures, and you use some of those savings to lower rate and some of those to lower the deficit. what's what the bowle-simpson

plan stands for. if revenue was part of the equation, and i think that goes a long way, but right now, there's this absolutist position even though every analysis why we have a deficit problem right now includes the long expecting aging of the population, but analysis shows there's 500 billion a year of higher deficits because of the tax cuts in the bush era that were never paid for. we support some of those, but we just need to be honest. there has been a revenue problem, and if we had paid for the tax cuts in 2000, we might not be having this conference right now. >> isn't there evidence, in fact, didn't christine that -- christina do work that if you give people money, they will spend it in the economy? >> well, there's no question

that when you are trying to -- you know, put more spending into the economy in the short term, when you're trying to essentially have an impact, that you want to give -- you want to put money out where it will be spent the quickest, have the highest multiplier impact, but actually when you argue that type of tax relief to help the economy in the short run to give money to those who have as you say the highest ability to spend, in other words when you make $38,000 a year and get an extra $500, you will spend close to $500 of that. it's getting out in the economy and help. when somebody makes $3.8 million, and they get $500, they may not remember where they left the check. that argues more when you try to do tax relief, center it more on people who live paycheck to paycheck, and that's what we've

done by having the payroll tax cut this year which was very important for economic growth particularly with higher gas prices, and that's the relief we pushed for people in the middle class more likely to need the money paycheck to paycheck and put it out in the economy and get us higher growth. >> let's talk about spending cuts and your thoughts on chairman ryan's ideas on medicare and medicaid. the affordable care act maps spending through the independent advisory board ipab mechanism. why do you think the small group of people serving on ipab can make less decisions about cost reimbursements in the light of the health complexity of the health care market in the united states. why is command and control the right approach for this problem? >> so it might not shock you i would not define the question the way that you did. [laughter] a couple things. number one, it's good, you know, we're talking about this ipab

issue in the independent board because in the president's plan, which was not just a speech or a press release, but a plan, we put out levels of detail that included saying that in 2018 and beyond, we actually would tighten our focus on medicare's growth by saying that where it was above gdp plus .05 per person in medicare, that the ipab looks for additional savings. first of all, we're having this discussion about the plan because we have put out significant details. look, here's the justification for it. a lot of people for years, democrats and republicans, said medicare unlike social security is a little harder just to figure out what, you know, combination of different adjustments or revenue adjustments you need because health care is very dynamic, but unfortunately, we don't act as much because it has often been

caight up in the political system, so the idea was to try to create a more independent, nonpolitical way of dealing with that, and, you know, there's been a lot of accusations of demagoguery, but if somebody do you want like that idea, you know, let's have another suggestion that the basic idea of bringing more expertise into the system, independent expertise to help adjust medicare as we learn more about quality and delivery system efficiencies in a way that doesn't have to go through two houses of congress all the time, doesn't have to be subject to the politics, was a very well-intentioned and very smart idea, and if it's not the best idea, let's hear something. i think one of the most unfortunate things going on right now has been the complete to littization of the affordable care act. president obama does not sit around and say, boy, we're going to defend every limit thing that we've done to the tee. he would welcome criticism or

comments on how to do things better, but we have a health care spending problem in the country, and we put together a very thoughtful effort that tried to get all of the type of reforms whether affordable, you know, the comprehensive care, the doimpt payment systems, the ipab, and these things right now have just become political fathers, so the reason -- i agree with chairman ryan on one thing. we should be able to have more serious discussion about these specifics of our plan, and i think would be easier for us to figure out what we agree and disagree on and how to make progress. >> walk us through it. let's have that discussion. what does medicare and medicaid look like over the next 10-15 years? >> well, let me just say something, you know, and you request watch me. i will use no phrases, nothing. i'm just going to describe why i, as a policy person, have concerns with chairman ryan's

plan based on the congressional budget office analysis. most of what you hear in the discussion is the fact that as you mentioned, a beneficiary in 2022 would have to pay $6400 more than they would in the current system, $6400 more, and that amount grows with time. that's where most of the discussions have been. let me go to another part of that calculation. what that same congressional budget office analysis shows is overall in his plan analyzed by the congressional budget office, we will spend $5700 more per medicare recipient. let me be sure everybody's clear on that. the goal of most health reform is not just to shift from one side of the leminger to the other, but have reforms that lower the amount we as a society spend on health care. his plan by cbo would take in

2022 instead of all of us together spending about $14,000 per medicare recipient, it be about $20,000. we would spend $5700 more per medicare recipient. how much is the government savings? the government saves about $615 per recipient. i hate to use numbers, but here's the basic deal. it does not show we spend less, but by having the private sector involved in this, you pay extra for the administrative cost, profit cost, advertising cost, and you are basically saying we pay this much more and the recipients pay $6400 for what cause? so the government saves $615 per recipient? that's not my analysis, but the congressional budget office.

chairman ryan says maybe it's more efficient. okay, i'll give it to him. 10% more efficient, it makes very little sense, and so i think you have to look and ask is that the type of reform we want, and do we feel comfortable changing the structure of medicare from something where there's a bit of a basic package people can count on to something completely, very new, when the congressional budget office at the chairman's request amized their plan so it could come out on the same day he announced it and found it was going to mean that we as a society was going to spend $5700 more per medicare recipient in 20 # #. >> what is your plan? >> our plan, we do a few things. first of all, we are involved in serious discussions that are going on right now as part of the biden group, and we're willing to look line by line

through traditional savings put forward by many of the bipartisan groups and congressional budget office. we, for one, would use more leverage in terms of the purr purchase of drugs. we think there's still savings to get and efficiencies in the payment system, and we've committed, publicly, that we're willing to do $470 billion of medicare and medicaid savings over the next 12 years, and the ipab does do something which we think is important. it means that we may not have if all right, but we're going to set up an independent body of authorities, six of them would be chosen by republicans, six by democrats in the congress, and that this group of experts look on a year-by-year basis, and if medicare spending was growing too much, it would never be on automatic pilot again. a group of experts would be forced to present options to the congress that they had to act on

or be implemented. again, maybe that could be done better, but it does not deserve the disperty it has. it's a serious proposal, and maybe there's a better way to do it, and we're all ears in trying to have that discussion. >> if the current health care law is effective, why are there so many waivers? there are 1,000 waivers? >> talking about for medicare or cad? >> the health care law. >> well, i think when you're doing any kind of thing, we always had this federal system where we try to create a, you know, we try to create a, you know, a system for our countries, and we've always had options for flexibility, and that's part of the leb story of -- laboratory we have in country. people can apply for waivers, and that gives them the

ability to experiment with more authority. we make sure when that's happening, it doesn't mean less coverage for very poor people or things that are destructive, and so again, i think the fact that we have waivers, that kind of flexibility is a positive, not a negative. it shows we're not trying to do one size facilities all, and so for example on the exchanges, we said if the state comes forward with a different system that they think is better and covers the same number of people, they can do so which again shows that this really is about, you know, whether somebody else actually has a better idea or whether they simply are deciding that it's okay not to cover 34 million americans going forward and continue to have the costs shifted to hospital, shifted to premiums as hidden taxes. i mean, our status owe on health care is not acceptable, and that is why the affordable care act is the right thing to do, and i

think, again, our goal as an add mings is is not just to have every single thing exactly as we designed the moment it passed, but what we would like is to have a constructive conversation where people recognize that we have put into this virtually every good idea had for more coordinated care, efficient care, aligning payment with the right incentives or rewarding hospitallings with readministrations that are completely unnecessary. these are all good policies. if it's not exactly right, let's have a discussion about it opposed to deciding you're going to name something the repeal, the job killing health care act, and make that simply, you know, a political sound bite and a political message when we're supposed to be talking about this important issue. if you think is separate from medicare, it is not. let's be very clear about one thing. the main reason that medicare

costs are going up in our country is that we have had the long awaited aging of our population. in 2020, in 2000 when i left as directer under president clinton, there were 45 million people on medicare. today and in 2020, 70 million, 25 million more. that's going to increase costs. that's why we did all the fiscal discipline in the 1990s so we were ready for that. the growth is 2.29%, lower than the growth of health care in the private sector, so if you're not doing the type of things that is bringing down cost in the overall system, you are likely to be back to the game of shifting costs from one part to the other instead of us, as an economy, trying to figure out how we can spend less overall. >> it's just worth noting that the costs have been so significant for companies and other institutions that they blocked to the extent that they received waivers, a significant

number, but let me move on to social security. why didn't you attack social security? >> why didn't we -- >> attack social security in terms of trying to cut social security services over the 10-12 year period? >> look, it's clear the obama administration is a bit the person in the middle on social security. there's no question there's some people, many of the groups we support and work with, who would like us to take social security completely off the table. we have, unfortunately, most of the republicans, virtually all so far saying they'll only do social security reform if you do the entire reform by cutting benefits. that's not how ronald reagan did it in 1983 or how it will ever get done. the president made clear in the state of the union and when he laid out the $4 trillion debt

reduction plan, while we do not think social security should be used as a device that's designed to lower the ten year deficit, that we do think we as a country would be better off dealing with protecting its core purposes, it's rock solid progressive benefit, and its solvency earlier opposed to later. what we are really looking for is folks from the other side to be willing to come to the table without this ideological, not a penny of revenues, and talk about how we could do this in a balanced way that doesn't slash current benefits, still protects those with disability, still keeps it a rock solid benefit. we have not taken it off the table, but this is an area where we need those who could help pass this to be willing to have a balanced conferring -- conversation about it. >> to be fair, chairman ryan also did not attack social

security as i referred to earlier. defense spending cuts? >> so, it is true that prior to president's recent plan that our defense budget actually increased the deficit by about $180-$190 billion over the ten year window. we now have a budget target that actually reduces spending and reduces deficit by $290 billion. that's over $450 billion swing, so we've made a pretty serious move on defense spending, and we're doing so because we recognize you just can't have this comprehensive deficit reduction effort, a sense of shared sacrifice, if you take any my senior area of the budget and just say it is completely off the table. this is difficult. the president's the commander in chief, not a think tank. he has to work this through in a very thoughtful way with the

chief of staff and secretary of defense, but we made a pretty significant commitment recently, one of the reasons we could get to $4 trillion in 1 years in the budget. >> such a serious commitment that, in fact, chairman ryan's team says bob gates has said that your spending cut proposals are not viable. >> well, you know, let's -- >> have you heard bob gates weigh in on this? >> i am -- the president and chief of staff and vice president have had many conversations with secretary of defense, and i am party to some of those, but i'm not discussing them herement i think we're on the same team, and i think he understands that defense has to be part of the overall effort to get our budget under control. >> okay. let me get some questions from the audience, and this is from michael piers of wyoming. as the father of a child with special needs, my family benefited from government programs, nevertheless, when

does the debt reach the level of good intentions today be crushing burdens on the next generation of tomorrow in? that's a great question and the spirit in the question is really touching in a sense that this is a person who has a child with special needs, and yet they're suggesting they are willing to be part of the shared sacrifice, but i have to say there are right ways and wrong ways to do things, and i'm just saying from a policy perspective, and i say this to everybody in this room, there is enormous discussion about the revenue side and the medicare side, but from a policy perspective, from a values perspective, we should be very deeply troubled by the medicaid cuts in the house republican plan. i want to make clear what they are. this is not my numbers. this is theirs. after they completely repeal the affordable care act, which would take away coverage for 34 million more thans according to

the congressional budget office, after they repeal that, they do a block grant to cut medicaid by $770 billion. in 2021, that cuts the program by 35%. under their own numbers by 2030, cuts projected spending in medicaid, by half, by 49%. of course, i don't think that -- or imply any negative intentions or lack of compassion, but there is a tyranny of the numbers that we have to face, and here's the tyranny of the numbers. 64% of medicaid spending goes to older people in nursing homes or families who have someone with serious disabilities. another 22% goes to 35 million very poor children. now, i ask you, how could you

possibly cut $35% of that -- 35% of that budget and not short hundreds of thousands, if not millions of families who are dealing with a parent, a grandparent in a nursing home, or a child with serious disabilities? how is the math possible? if you tried to protect them, mathematically, you have to eliminate coverage for all 34 million children. ..

>> medical costs. there's a katie beckett program that was passed by president reagan that says if you have a child that's in need of institutional care, you can get help from medicaid. this is -- this is a life support for many of these families. but these are the optional programs in medicaid. these are the ones that go to more middle class families. if you're going to cut 49% of projected medicaid spending by 2030, do you really think these programs will not be seriously hurt? so when we say that the tyranny of the math is that these -- that these -- this medicaid program, this medicaid cut will lead to millions of poor children, children with serious

disabilities, children with autism remembered americans in nursing homes losing their coverage or being -- or having to significantly cut, we are not criticizing their plan. we are just simply explaining their plan. >> gene, one more question from viewers from andover. won't putting america back to work help reduce the deficit? >> you know, absolutely and i think when people talk about the efforts that were done -- i mean, let's understand what happened. we inherited -- we inherited a very, very deep deficit. and there's no question that we took efforts through the recovery act to add money temporarily to the deficit to help get your economy back. we think they help prevent us from going into a prolonged recession or even a depression so, of course, growth is important and we're at a point right now where we have 9% unemployment.

we have private sector job growth strengthening but not good enough and so we have to do this the right way. we have to do it with balance. we need to be able to say that -- that we are giving confidence to investors and people who create jobs around the world that the united states is still a good place to invest because we're getting our fiscal house in order. we're willing to implement significant cuts and select revenue increases to do so. but we do so in a way that's phased in because that would be counterproductive. i just want to make a overall point because i think it's very important. for so many people like pete peterson and others who have devoted themselves to us dealing with the baby boomer retirement, the long-term entitlement, part of the theory behind us dealing with us is we didn't want to be a society that spent so much just so older americans that we

lost our ability to invest in our children, in education, in the science and research and innovation that's important to our future productivity. it was very much that type of thinking that led so many people to want to deal early on with the aging of our population. but what is happening right now is there's become a very, i think, unfortunate desire to simply cut domestic discretionary spending across-the-board, to unprecedented low levels even though this is the area where the national institute of health is in. the national science foundation, pell grants, you know, head start. we need to do fiscal discipline going forward. but as the president said, you don't unload a plane that's loaded up too high needs to have some weight taken off of it. but you don't take the engine out. so we need to have a balanced plan that does not take our

levels of domestic spending to such low levels that it might sound good for press releases. it might sound good but where we are actually defined the fundamental -- one of the fundamental goals of dealing with our long-term entitlement situation by actually failing to invest in our children, failing to invest in research, medical research, innovation and i think that's very, very important as we go forward. >> which aspects of chairman ryan's plan would the administration be willing to incorporate to get the republican buy-in? >> look, i think there's -- there's places that are very difficult for us to go to. i think the hardest really -- when you look at medicaid block grants and food stamp block grants, those are things i think would be very, very difficult for us to ever support. number 1, we think it takes away the basic social compact in those programs. it would lead to the type of

very unfortunate cuts we just discussed. secondly, i don't think they're wise economic policy. the federal reserve estimates that the fact what they call automatic stabilizers, things like food stamps and unemployment insurance and medicaid -- that where we increase spending as we go through recessions or more people go into poverty helps smooth out our business cycle, our recessions. doing them in block grants not only will be bad for some of our most hard-pressed americans. it will also be, i think, unwise macroeconomic policy because it will reduce the automatic stabilizers in our economy so i think that those kind of block grants are difficult. we just -- we are open to talking about many ideas on the medicare but for the reasons i've discussed, i think the current house republican medicaid plan is just very, very poorly designed. i mean, it just -- to make beneficiaries pay 6,000 more so

that the government can get $615 more in savings, you know, that's what people say about my basketball skills. he's slow but he can't jump. it puts a lot of beneficiaries -- it puts a lot of costs on beneficiaries but it doesn't save much for the government so i think that when you're doing -- if you want to go into the areas of reform, you have to do so carefully and you have to be not upset on basic guarantees that i think are important to our safety net, but look, we have basically agreed to a level of domestic discretionary savings that are consistent with the bowls simpson plans. we have put a level of medicare and medicaid savings consistent with the bowles-simpson plan. the only thing they don't go as far than us is on defense and they have more revenue than we do. so we are the ones who are very close to the bipartisan fiscal plans. we have a balanced plan. we're taking nothing off the table.

you know what i hope? i think chairman ryan, you know, is somebody i like personally and i think he is a lot of sincerity but i think what's happened is that in their desire to live by what is an ideological view that you can't have a penny of revenues, it forces you to do things like the medicaid savings that when you look at the details of, i don't think many of the people who voted for them would really support if they understood the full implications of. >> gene, final question here, what are the administration's fiscal goals, top priorities this year and how will you achieve them? briefly. >> i think at the moment, you know, i think the most important fiscal goal, and this is one place where i think we -- i agree very much with what chairman ryan said. we have to give a down payment now. a lot of what people judge around the world is not that

they say, you know, i don't know that people when they look at what gives confidence in our economy says, oh, it's if it's at 2.2, we have confidence but at 2.8 we don't. i think they look and ask. i think they start with the view of enormous confidence in the united states. we are fortunate. people have a positive bias towards the united states. we are even in an ugly economy, we're often the prettiest kid in the room. we're often the safest haven even when people are most roiled around the world. so we have something very special. and we need to protect it. that's why you can't play games with things like a default. you just can't play games. it's a treasured asset that we inherited from alexander hamilton, that the u.s. credit standing, our credit-worthiness is something that's the gold

offic standard. and on the fiscal discipline side, i think what people would like to see is that even with the types of division we have, we as a country are capable of coming together and doing something serious. if we got a serious down payment on deficit reduction in the summer of 2011, i think that would have been way above the expectations that people would have had in november when they saw we were going to be a period of divided government. and my guess is that a serious down payment isn't going to get you all the way there. but the path to deficit reduction doesn't always happen all at one time. and to be bipartisan, you know, president bush, the older president bush started in 1990. he didn't go far enough. but president clinton bravely put forward a plan with no debt republican support in '93 and then in '97 dealing with medicare, two incredible

adversaries, newt gingrich and bill clinton came together. so i think what people need to see is that we're on the right path so i think getting a serious deficit reduction package which means looking for the areas we agree on and trying to press each side to move a little bit from long-held positions so that you hold hands and jump together and do something that's politically difficult for each to do alone but together is politically viable and is economically important to the country. that would be the most important thing. i think that would be enormously confidence-building. and i will say that i'm fortunate to be one of the people at the table for the discussions. and if you're in that room, you would really be struck by the seriousness of purpose, the degree people are going line by line. and i think there's trust building up. i didn't know eric cantor very well before this.

and probably disagreed on virtually nothing with him. but you sit in a room and have discussions and everyone including congressman cantor comes very well prepared, ready to talk specifics as opposed to giving speeches. and i can't tell you that this biden negotiating group is not a commission. it's a negotiating group with people selected by the leadership to negotiate. i can't tell you that we'll get all the way to the finish line but there's a real seriousness of purpose in that room that gives me some optimism. >> gene sperling, thank you very much. >> thank you. >> and we'll have more on the federal debt issue this weekend on newsmakers. our guest is senator tom coburn who was a member of the containing of 6 group in the senate. but he left the group on may 17th. he'll discuss how congress is tackling the debt issue and how republicans and democrats might reach an agreement on cutting spending and tax issues as the august 2nd date on the debt ceiling approaches. newsmakers airs on sunday at 10:00 am and again at 6:00 pm eastern on c-span.

>> white house budget director jack lew is one of the administration's negotiators involved in current budget costs on reducing the deficit and national debt. monday he gave his insight into some of the key issues. from the economic club of washington, this is about 50 minutes. >> we're very pleased to have this evening as our special guest, jack lew who is the director of the office of management and budget. jack is somebody i've known for about 35 years, i guess, because i knew him when he was a relatively young staff person on capitol hill. jack is a native of new york. graduate of harvard college. after he graduated from harvard college, he worked for tip o'neill and worked on tip o'neill's staff for eight years and rose up to be head of policy development, policy planning for tip o'neill. after about eight years with the speaker, he left to come

practice law in washington with van ness feldman and practiced for five years. and came into the clinton administration where he originally worked in the white house as special assistant to the president in certain policy areas including americorps and helped draft the legislation for americorps and went to the office of management and budget where he rose up from executive associate director for omb to deputy director of omb to the director of omb and served as director of omb from 1998 to 2001. during that period of time, the united states government had the largest budget surplus in our entire history. [applause] >> the government add budget surplus of $236 billion and we have never beat that since. and may not.

[laughter] >> he left the administration in the clinton administration and he went to nyu where he was vice president for operations at nyu and also taught at nyu, later joined citi copper and became the coo of its alternative management business and then at the beginning of the obama administration, came into the administration as deputy secretary of state for operations management and then he took the position recently of being the director of omb again. so he's the only person in history who has held that position twice. so jack, my first question is the obvious one. if you went from having the highest budget surplus in history -- [laughter] >> and a record that's not likely to be topped anytime soon, what made you think that it would be a good thing to come back and be head of omb and be

in charge of very large deficits. >> thanks for having me here tonight, david. this is certainly a challenge. when the president asks you to take a job that you had before, you're instinctive answer would be, why would i want to do it again. and when the president makes the case that he needs somebody with experience to hit the ground doing and he needs you to do it so it's very hard to say no. >> how many times did he have to ask you. >> that's between me and the president. [laughter] >> so what is the principal difference between the head of omb now and how has the job changed obviously the surplus issues? >> obviously, leaving after three years of surplus, which did not happen by accident. we had a long period of time when we were focused on deficit reduction and proved that you could actually eliminate a deficit and turn a surplus but leaving after three years of

surplus, coming back with a deficit that is larger than any we ever imagined -- the day i left office, i testified at the senate budget committee and projected a surplus of over $5 trillion over the next 10 years. when i came back, there was a deficit projection of over $10 trillion over the next 10 years. you can't get much different than that. you know, i think a number of things have changed, apart from the dimensions from the budget problem. and part of it is the kind of change that's being experienced throughout the economy. information flows much more quickly. technology has made it -- there's instantaneous analysis and conveyance of information which actually takes a process that was always a very stressful and high stakes process and made it even more so because there's this constant flow of information. >> let me ask you, under -- can you contrast how president

clinton dealt with the head of omb with president obama? did clinton get into the budget issues and does obama get into the budget issues? how much interaction do you have with the president on the budget appeals? >> well, budget appeals are kind of a narrow part of the interaction you have with the president as budget director. it's kind of one part of the year, and i would say in both cases i consider it a mark of some success to keep the number of appeals to a small number. in fact, very few if any. the truth is if the president conveys to the cabinet that the shape of the challenge is the same as the shape of the challenge that the omb director is describing, then it gets to the question of, you know, is there a meaningful appeal. >> does anybody go around you? in other words, have they called the president and say the omb director is terrible and i have a better position on this? >> i would say that there are -- there are occasions when cabinet members want to be heard but i've been privileged to work for two presidents who support their

omb director. >> okay. all right. so this year under the budget that the president proposed and you developed, the projected deficit for fy '12 is what number. >> the numbers are coming in lower than that, closer to 1.4. either way it's a very large number. >> so $1.4 trillion deficits, so the tax revenues are roughly 2.6 trillion? so we're borrowing about 40% of the budget? >> yes. it is a record deficit. and it's the reason why there's a bipartisan consensus right now in washington that we need to focus on deficit reduction in a very serious way. i think if you look at the size of the deficit, you know, right now, it doesn't tell the whole story of how we got there. i mean, having left 10 years ago

with a huge surplus, there was a series of -- there were a series of decisions made and circumstances. decisions were made on policy grounds, tax cuts and new benefits like prescription drug benefits that weren't paid for. >> right. >> and that essentially eliminated the surpluses. then there were wars that weren't paid for and an economic decline that had two impacts on the deficit. one is it drove down revenues because less growth means less income, less taxes. and it also required very substantial intervention because without stimulus, we wouldn't be experiencing the recovery that we're now experiencing. the net result when i came back on the scene was a deficit was that was bigger than any could imagine 10 years ago. >> when you left government before, there was a concern in some circumstantial evidence that we would pay off all the government debt and there would be no treasury bills against which corporate debt could be measured. that's not a problem any longer.

>> it's almost nostalgic to hear. >> i think your proposal was to cut out 4 trillion spending over 12 years? >> right. our proposal was 4 trillion of deficit reduction, roughly 2 trillion of spending, 1 trillion of revenue and 1 trillion of saved interest. >> okay. if you do that, if you've got everything you want, you're still adding $10 trillion to the deficit over that 12-year period of time. so if we have 14 trillion today of debt and then you add another 10 trillion or so in the next 10 years, how are we better off with that $4 billion reduction? >> well, when you're talking about numbers that are this large, it takes a long time to dig yourself out of a hole. the first challenge is stabilizing the deficit as a percentage of the economy. so we get to the point where debt stops growing as a percentage of gdp. our proposal were it adopted,

now, obviously, there's not a practice of parliamentary government here so we know it's not going to be adopted in every detail that we've proposed, you know, it would bring the deficit down to roughly 2.5% of gdp which would accomplish the goal by 2015 and then lower by the end of the decade. i think that if we look in that range of $4 trillion savings over the next 10 to 12 years, and really accomplish it, we can get the deficit to the point where we're looking out and instead of seeing the debt growing ultimately to 100% of gdp, we could stabilize it and then you could make additional, you know, policy decisions to bring it down to the long term. you've got to take that first very important step. we call it a down payment. i think a down payment understates what it really is. it is critically important, and we need to take that action now. it's not something we should wait two or three years to do. >> well, at the end of the last congress in the lame duck

session, the tax cuts were extended, the so-called bush tax cuts were extended. that added i don't know 1 or $2 trillion to the -- $800 billion. >> $800 billion. >> $800 billion, sorry. why as the omb director support that. wouldn't that add a lot to the deficit. why not eliminate those cuts? >> you know, in a very sensitive moment in terms of economic transition. we are no longer in recession. but we're in a recovery that is not something we could just take for granted. in december, had there been no tax bills, what we would have seen on january 1st with the tax increase right at the time when you were seeing job creation and economic growth beginning to settle in, we feared and i think we feared correctly that were that to happen, we could have had a double-dip and that would have been a terrible thing for the economy. it would have been a terrible thing for fiscal policy because one of the engines that we need in order to get out of this deficit hole is economic growth.

without economic growth you can't cut your way out of the problem 'cause one of the causes was the economic decline. you know, i think that the balance in the tax bill in december is one that did a lot to stimulate the economy. there's a payroll tax holiday and there's an extension of refundable tax credits for people who are sending their kids to college and for the earned income tax credit, you know, there was an extension of unemployment tax benefits. these are things that had an immediate stimulative effect. we had made no secret to the fact that we did not support the idea of extending the tax cuts at the high bracket. it was a compromise to do it for two years, where one side said it should be at the end of the two years, it should go away and it should go back to the tax rates which were in the 1990s. the tax rates we had when the when we had the longest period of uninterrupted economic growth in our history so we think there were tax rates highly consistent with stable growth. the other side would like to see made permanent. we're going to have a chance to

have that debate. >> right. >> but last december was not the time to kind of throw the gears into reverse on the economy. and that's what we would have faced had there not been a compromise. it was an honorable compromise. >> and the president's position, i think, when the campaign was that he didn't want to have any tax increases above positive forepeople below $250,000 and to protect the middle class. but people who make $250,000 and above are only 2% of the population. so the middle class presumably is $100,000 or something like that so if you want to protect the middle class, why would not you not reduce or increase taxes on people above 100,000 because 250 is well above the middle class. >> i think that if you -- if you look at where the middle class lies, you'll get a lot of different explanations. i've had people argue it's well above 250 when they argue we drew the line, you know, too low.

i think if you look at the tax bracket is above and below it. and what we said it was not necessary to raise taxes, to keep the tax cut in that top tax bracket. we also -- by putting a plan together that accomplishes $4 trillion of deficit reduction, shows you don't need to raise taxes on people below $250,000. so, you know, we're obviously a long ways off from getting a bipartisan agreement on the future tax policy for the country. but i think we've made it clear that shared sacrifice means that people have been lucky enough to be in the top tax bracket to have bear part of the burden. the cuts that we're making on the spending side, while disproportionately people below that is not a question who are good people and who are bad people. the president was actually quite careful when he made his remarks just about six weeks ago at george washington university, to make it clear that this was a question about everything being on the table so that we have the

kinds of choices that can be balanced. and people who have been lucky enough to be in that tax bracket actually when he talks to them don't complain to them that much about their tax rate. >> okay. so let me ask you when people talk about a budget cut, do they really mean a cut below what the production is going to be or a real cut? right now one example when you talk about budget cuts are you really talking about cuts below what the current spending is or below what it would otherwise grow to? >> for different purposes you would talk about it neither way. when we look at what projected deficits are, projected deficits are based on projected growth, not on current levels going forward. so there is an assumption about inflation on things like social security and medicare. there are assumptions about more people being eligible and any changes that you make to that baseline give you savings for deficit reduction. >> now, if somebody represents, let's say, a business interest

and they want to come to see you, can they just call up and come or lobby? you don't meet lobbyists i assume or how do people influence you? >> i seem to have a schedule that's full from 7:00 in the morning until 10:00 at night so a lot of people see me. >> okay. >> you know, i meet with groups more than with individuals. but i will meet with people who have serious issues to raise. i mean, my frustration is that your time is so filled up with internal meetings and things that take up 80% of the day that you sometimes feel like you're in a cocoon and you have to struggle to hear things that aren't just the same people you talk to in those meetings that you really must be part of. >> they have project insurance of budget rates and economic growth and you have yours. who's are more accurate? [applause] >> you know, all projections

have risk of error, you know, when i was at omb the last time, my errors were always underperforming. so reality was better than i projected. i haven't had a track record yet so i can't -- i can't speak after just six months. you know, you look at economic projections and they do drive these numbers in a very important way. we're pretty close. we all gravitate around mainstream kind of centrist blue chip kind of economics. there's sometimes one factor or another where there's a principal difference and i'll give you an example. our assumption about long-term growth is that this recession, the recovery from it will ultimately return us to the same level of potential gdp that we had before the recession. that's been the experience of the recovery from every previous recession including every

financial-led recession. the budget office says there's some budget loss in the economy. our assumption is in the midrange of the fed's assumptions. you know, theirs are within the mainstream as well. we don't know sitting here today who's going to be right. our view is if you make the right policy, the united states is always returned and we don't think anything about this recession should make us bet on the opposite so that's a principled difference and i'm happy to debate it. you know, this year we're a little below them in some things. so, you know, over time it kind of evens out. >> what is your projections would be, say, in november of next year? >> i don't remember the year to year unemployment projections or any other year to year projections. we show a trending down. we show growth trending up. and -- >> you think you can get below 8%? >> we, obviously, would like to get unemployment as low as we possibly can. as quickly as we possibly can.

the principal thing that the american people are looking to us to be worried about and every day we worry about the unemployment rate. >> well, when you were in the government last time, a budget deal was cut between the congressional republicans and the clinton administration that led, i guess, to the budget surplus. and what was the key to getting that deal done and you see the elements of a similar deal this time? >> you know, if you look at what was the environment we were in then, in some ways it was less likely than the now. you know, there was certainly a sense of common purpose, i think, a process of building up relationships over a period of many months. made it possible for us to explore what was in our common interests but i don't think there was an intending sense of crisis. it was a sense that it was the right thing to do. and it was a very good thing that we did it. i think right now we're in a

situation where the whole world is watching to see will we be able to get our fiscal house in order. there was a lot of understanding that we had to worry about the recovery through the end of last year. so i don't think that the tax bill that you asked about earlier caused a lot of eyebrows to go up in the kind of world economic community. as we're in a recovery, as we're looking out at these deficit forecasts, there's a sense that we have to start taking action now because it takes a few years for things to kick in. and if we want fiscal consolidation to be hitting at the point when it really should, wait until 2013 meaning waiting until 2015 or 2016. and i think that you look at things like the standard & poor's evaluation that came out ago. it was very interesting document. it said the united states' aaa rating as a political analysis they said we're afraid no action will be taken now and if no action is taken now and put off

until 2013, we're worried it will get beyond the point when action needs to be taken. now, i'm not saying that's a reason for us to act today versus six months or a year from now but i think it reflects a real concern that the political environment in washington could stand in the way, and i think one of the things that is very promising in the conversations that are going on now, you know, the vice president leading -- >> are you involved in those? >> i am involved in those. there is a shared sense of purpose in those conversations. i think -- you look -- everyone came in with the same definition of the problem. we all said we need to do something that is roughly $4 trillion. whether it's 10 years or 12 years is the detail. $4 trillion of deficit reduction is something we engage in. we're in a process where there is a lot of trust being built up so that you can discuss serious options. and, you know, there's a need to act because we all know it's not

going to be easier to act six months or nine months from now than it is now. so i'm actually notwithstanding the difficulty of the problems optimistic. >> when do you think a resolution of the biden-led discussions will be made public? >> well, i think, you know, we're now, you know, because of all the scheduling complexities going into what's essentially the third week of discussions. i think we have a lot of work ahead of us. i think quite a few weeks of conversation. >> where are they going to have those discussions? >> we've been meeting at blair house. tomorrow the meeting will have to be moved because the prime minister of israel will be staying at blair house. >> where will you be going? >> in very appropriate accommodations. >> now, you're going to have -- even if you get your $4 trillion, you're still going to have 20 plus trillion of debt;

is that right? >> yes. >> and then you have the fannie mae and freddie mac on top of that, maybe 25 trillion. as a percentage of gdp, won't it still be pretty large? >> it is large. you know, but if it stabilizes, i think it's possible to send a very reassuring signal both to markets and to taxpayers that we will be able to work our way out of it. it takes a long time to build down accumulated debt. you know, in the years that we were balancing the budget in the 1990s worked our way out of the deficits that were built up in world war ii. and, you know, so i don't think we can realistically think that you can take a deficit this large and eliminate it in one kind of -- one negotiation or one cycle. you can arrest it in terms of the deficit is a percentage of gdp driving it forward and then

you get it in the right direction and that's what we're aiming to do. >> the defense budget now is roughly 800 billion a year or something like that? if you count the regular defense budget plus the special appropriations for what were called contingency operations or -- >> $800 billion. >> do you see a need to reduce that dramatically to get where you want to go? >> the president proposed when he put his framework out that we look for savings in every part of the budget. in the security part of the budget he said we'd been successful, secretary gates has been successful over the last two years making roughly $400 billion of savings on the defense budget. he said we can do that again. we can get another $400 billion of savings in the security area. and we're now in the process of a review. it will require a strategic review because to do it again will be difficult just looking for low-hanging fruit but we're now -- secretary had comments on

this last week launching the strategic review. we're working very closely together on it. >> so what is the best way for a cabinet officer to win an argument with you? [laughter] >> what's the argument you like the best. >> i like facts and clear analysis. so if you start with fact and clear analysis and less emotion, it tends to work better with me. >> okay. >> arguments that begin, you know, your staff messed this up aren't the best way to start the conversation. [laughter] >> does anybody do i think cap weinberger under ronald reagan when he wanted to get more defense spending, he would show these charts to ronald reagan with pictures of soldiers and show, you know, a lot of military soldiers and i guess it got president reagan really interested in it so has anybody come in with pictures and illustrations that really are effective? >> you know, nowadays everybody has decks it's powerpoint and slides. you can make a clear argument with no pieces of paper. you can make it with a memo.

you can make it with slides. you know, clear thought is clear thought. >> anybody ever make the argument it's so small it doesn't make a difference so you should approve it. >> everything is small when it's yours and it's large when it's someone else's. [laughter] >> but does the president go through the budget appeals in the cabinet room and there are a lot of those every year? >> you know, the challenge when you're dealing with something as vast as the federal budget is to find the right level of detail to share with the president on a regular basis. and, you know, having networked for two presidents, every president has their own style. i've been privileged to work for two presidents who are smarter who i am so it's not very hard to get them into -- into a serious discussion on almost any aspect of the federal budget. their level of interest and knowledge and curiosity. the challenge is you don't have enough time to do that with everything. so i found over the years if you can give a clear overview and

then go department by department showing what's changed and what is, you know, potentially controversial, you can direct the conversation to the things that really warrant presidential attention. and flag the things that they would want to know more about. the danger of trying to take every issue as the president you don't have time and you don't use the president's time on the things that really are decisions that he would want clear and separate direction on. and any member of the cabinet could raise the issue with the president so you're never taking the cabinet members' opportunity away. i'm pleased to say it's rare that -- very, very rare that members -- cabinet members have had to go to the president. >> and do members of congress lobby you as well? >> you previously get letters and phone calls from members of congress, yes. >> and what's the most effective argument they can make? >> you know, again, i think in

general -- i think the more on the level arguments are, you know, what the importance of something is, what the facts are, what the case is -- there's no reason to be embarrassed to say that something is important to the economy of your district. you know, if it's rooted in serious analysis -- you know, to say that a project has, you know, more benefits than costs when you look at the analysis and it turns out to be the opposite is not a very compelling argument. you know, to say that even though there may be other projects that appear to be more worthy, that this one is particularly important because it tends to be a more compelling argument, you know? >> you envision any chance of a debt bill not getting passed the debt limit bill? >> no >> so how will it pass? >> i've been through quite a number of meetings with the members of the house and the senate, i think there is a

shared understanding that it is just unthinkable for us to default on the u.s. -- >> but it will wait until the last possible minute. is that august -- >> i can't argue that it won't be pretty. things rarely happen early in washington. i actually think this is one where there is a very strong reason to do it sooner rather than later. you know, we saw in the final days of debate over the fiscal 2011 funding, as we were potentially heading towards the government shutdown, we saw the whole world watching clockdown clocks so would the federal government shut down or not. that would be a terrible thing if we had that kind of watch, is the united states going to default? is the united states going to, you know, for the first time in its history, you know, be bankrupt? >> but do you think there was going to be a government shutdown recently?

>> i did not. >> okay. and so you told all your employees to come in to work and everything? >> you know, i actually tried very carefully to tell my employees the same things that we told every other federal employee. and it annoyed some of the people at omb who thought i should maybe tell them manage that was the inside scoop. we were telling all federal employees the same thing. we believed and we turned out to be correct that there wasn't going to be a shutdown. at the very, very end, in the last days when there was the chance that if even if no one wanted to shut down, because the process might just get jammed up, we went into a mode of communicating, you know, higher level of risk. but, you know, we tried very hard to keep the issue from becoming kind of prematurely one of a sense of panic. you know, it was in no one's interest for the government to shut down. and that was bourne out by the actions that were taken. >> but did you think there was going to be a government shutdown in the clinton administration when it actually happened?

>> well, you know, i think it's a little different because, and i'm looking at a friend of mine here when we were at the opposite side of one. there was a decision by one side that it might be a good strategy to shut the government down and that made it, i think, harder to avoid. i was hopeful we could avoid it then. i never thought it was a good idea. i wasn't particularly surprised in the '90s when it backfired and it turned out that people weren't so happy when the government shut down and they couldn't get a passport. they couldn't take their family vacation, you know, to the park. they couldn't rely on the fact that basic government services would be provided in an uninterrupted way. i think we saw again in the last few days leading up to the final resolution without a shutdown that it makes people very anxious for good reason. we should be able to get our work done. now, entitlement spending, what percentage would you say -- you have $3.750 trillion budget

proposal. what percentage of that is so-called entitlement spending that you just can't cut right now? >> so the two major areas are held and social security. health, medicare and medicaid are about 20%. social security is about 20%. that's 40%. then there's another group of programs which get far less, you know, attention, but things like agriculture programs other retirement programs, that's about 17%. so overall if you look at the things that are not annually appropriated that you have to go in and change the law in order to have them operate differently, it's more like 57%. >> what percentage is defense spending? >> 24. >> so 57 and 24 that would be about 81%. so you've got -- >> so discretionary spending, the thing everyone looks to solve the problem is about 12%

to solve the budget. the other 6% is interest. >> okay. so you have 12% to play with. that's all you can really change. >> well, and the appropriations process for nonsecurity spending. now, that's why we always made the case when you look look at a deficit as large as we're looking at -- if you're talking about a deficit that's roughly $1.5 trillion and all of the nonsecurity spending is only several hundred billion dollars, there's no way you can solve the deficit problem no matter how much you cut, nonsecurity spending. now, we thought it was important to reduce spending in the nonsecurity area. that's why we reached an agreement, you know, where there was $38.5 billion from last year's appropriations, and reductions from the president's budget for 2011. it's also why we say we've gone pretty much to the edge. there's not a lot more to cut without going into things that really undermine our future. and it's going to be a question

of how you balance the tradeoffs. you know, one of the reasons everything has to be on the table is if you try to solve this deficit problem with anything off the table you end up with choices that are, frankly, the wrong policy outcomes. so if revenue is not on the table, it pushes you to go deeper into discretionary spending and entitlement. you take entitlements off the table completely there's no way you can solve the problem just on discretionary spending. the only way this can be solved in a way that's really in the best interest of all the people, is for everyone to bear part of the burden for it to be truly shared sacrifice. >> let's suppose the president was re-elected and you served the entire second year of omb -- >> i thought you were my friend. [laughter] >> at that period of time of 2016, what would be the best case for the deficit? what's the lowest you think it could be in 2016? >> i don't want to throw a number out there, but --

>> just between us. [laughter] >> i think if you're looking at the percentage of gdp -- if you're looking at the percentage of gdp, you could see the deficit in 2016 in the 2.5% or below range which would be very important. >> and what percentage is it now? >> now -- >> in the 20s. >> no, no it's not in the 20s. it's been hovering -- >> oh, i'm sorry, spending -- the spending is a percentage of gdp. >> spending is in the 20s. >> 20s, okay. all right. and do you think being a business person -- you were in the business world has made you a better omb director or a less effective omb director or what would you say? >> i actually think every experience that you have makes you more effective in what you do next. i think that having worked in the private sector, both for university and in the financial services field you have a different perspective on what it means to have government policy made and then to try to do your

business consistent with those policies. i felt that when i practiced law as well. i mean, the very first thing that i had to do when i went to a law firm was the client wanted to know how to go about relicensing a federal hydropower license. and i looked at the statute and it turned out it was a compromise that was deliberately ambiguous and i couldn't answer the question clearly. it gave me a whole different view on what the things you do to kind of get through the night mean when you're out in the real world just trying to make decisions and you want clarity. that was 25 years ago. and you have accumulated experiences that i think inform your judgments in many ways. i think having been in government and out of government several times -- one of the things i think for me has been most important is you kind of refresh your ability to look at problems and think about them without thinking that you know the answer already. you know, when i was in this job

the last time -- i'd been in omb for six years and it was time for me to leave. i knew that i was probably not able to look at everything fresh. it came back 10 years in between and some of the same issues come up, and i know that -- you felt one way about that 10 years ago but it's different. the economy has changed. is it still the same right answer? and i think you need to refresh yourself in these positions. >> but when the president asked you to take this job, he didn't say, if you get the deficit down to a certain level, i'll make you secretary of state in the second term? nothing like that? you didn't get that kind of promise? >> i neither sought nor got any commitment for the future. >> all right. what would you like your legacy to be as omb director when you ultimately do leave? would it be to reduce the deficit as a percentage of gdp or what would you like to see as your legacy as an omb director?

>> i was very proud to leave omb with a surplus. you know, it was the first time there had been three years of surplus since andrew johnson was president. it will be a long time since somebody can say the same thing again, i think. i know that coming in with the problems we face today, there's very little probability that i'll be leaving with a record that is as objectively strong as the record that i had the last time. i think by the same token, if at the end of my tenure we've stabilized the deficit, we've restored confidence that we have our fiscal house in order, and that we're on the path that we can manage our business in an effective way, that's an enormous accomplishment. i wouldn't say that i'm not sad about the years i left behind but you take the world as it i say ands today. i think going forward theories an awful lot we can do in the next year and a half, two years to turn things in the right

direction. and as somebody who's came back to an agency that i have, you know, feeling for. it's been a tough time for omb and i want to help rebuild the agency as well. it's not easy when you're in the middle of one negotiation going into another. but omb is one of the real crown jewels in the federal government. and paying attention to it as an organization matters to me. >> how many people work at omb? >> about 500. >> and how many of those are political appointees? >> the exact number i don't know but it's less than 50. >> so a lot of people working there before are still there? >> just based on -- i haven't looked at a tally but about half the staff appear to be people i worked with when i was there 10 years ago. >> all right. we have some time for the questions. does anyone want to know what the deficit is going to be or any programs you want to ask whether they're going to be funded or not?

any questions? right here. just identify yourself and get a mic if you could. there's a mic coming. >> thank you, my name is steve veto. mr. lew a lot has been written about inflation, commodity prices have all gone up. the head of the federal reserve, ben bernanke doesn't seem overly concerned. when you put your economic models together, what are your assumptions on the inflation. >> our general view with inflation is not inconsistent with the numbers that the fed looks at. we don't see enormous risking in the immediate future. but at the same token there are very significant things going on that are creating real burdens for the american people. i mean, oil prices, gasoline prices. they're a real problem. and they have an impact on consumer confidence and the

like. you look across the economy at all the factor inputs, labor and where we stand vis-a-vis other countries, overall inflation does not seem to be something we need to worry excessively about. we do have to worry about oil prices and that's why the president has been so determined to develop new technologies to make sure that we can safely, you know, explore, you know, the u.s. fossil fuel resources. and work as hard as we can to make sure that companies that are making substantial profits are doing it in a way that's not unfair to consumers. it kind of ties back to our tax policy. one of the things we would like to do on the tax side is take away some of the special tax provisions for companies that have benefited from oil and gas,

you know, profits. we think it's only fair that we're looking at shared sacrifice. if taxpayers who are burdened by higher gas prices, they're also the ones who are hit when we have to have cuts in domestic spending. and it shouldn't be that it's a one-sided calculation. >> other questions? right here. time for one or two more and then we're done. >> hi, paul, from ernst^&.young when you think about our experience in the last two years, what have you learned about the effectiveness of keynesian economics as a policy tool? >> young i think that we've learned that it does work to put stimulus into the economy when you're in need of it, as we were in 2008 when we were kind of at the bottom of the recession. when you look at a stimulus package, you have to look not at a kind of random period of time

but where are you at this point in time? and 2008, we were looking at a situation where projections of the, you know, length of the recession were getting longer and longer, almost by the day. i was working during the transition period on some of the kind of thinking that went into the stimulus package ultimately. and it was -- having worked on several recovery packages, i'd never seen a situation where every day the sense of, you know, how long the recession would be was deepening. now, that changes the tools that you have available to make effective macroeconomic interventions. if you think that the recession is going to last a year or 18 months you'll be out of it and you'll be worrying about inflation, that would lead you to one set of options. in 2008, we were looking at a period of time where we knew for the next two to three years it was going to be a good thing if there was an injection of

economic activity. so it gave the ability to do things that, you know, in a shallower recession you might have done. so the combination of immediately putting money in the states so that they could avoid laying off teachers and policemen and firemen at the local level immediately having assistance go through income maintenance programs, you know, unemployment and food stamps to get into consumers hands and spent, that's the kind of stuff that you knew would have immediate impact. building roads and things like high-speed rail, you knew to have a longer runway and it would take longer and because we knew there was a need for economic stimulus for that period of time, i wasn't in the economic team at the time those decisions were made. it was definitely the right decision. now, you look back and you say, you know, right now we're seeing pretty solid economic growth. if you were to subtract 1 or 2% from that or take our unemployment rate and add 1 or

2% to that, it would feel pretty bad and that's where we would have been without the recovery package. so i think it's proven that it works. it doesn't mean that we don't now have to turn the corner and get our hands around our fiscal challenges going forward. but we have to get from 2008 to 2011 and i think the recovery package helped do it in a way that created millions of jobs and avoided a deeper and longer recession. >> you worked for president clinton and president obama. who was smarter? >> they're both very smart. [laughter] >> you worked for hillary clinton and bill clinton, who was smarter? >> you know, you talk people of that level of smart, how do you compare? >> you're very diplomatic. one last question, anybody else? okay. jerry? >> after taking a look again at your resume and seeing all of your accomplishments, which david has focused on as well, i was struck by the fact that you were a key player in the social security commission.

and as i look at all these tough decisions that you have to make, it strikes me that's the easiest area to make progress on. i would describe it almost as a lay-up. how would you describe the social security reform proposals that are being talked about as part of a potential package? and is it one of the things that really -- the time is right to move ahead on? >> so i think that it's important to separate social security from the broader fiscal policy discussion. you know, it is something i've worked on for 30 years. i believe very strongly that the right time to deal with social security is now. the president has said in the state of the union. he said it in his speech just a few weeks ago. and we should work on it because we owe it to people who are working now and about to retire,

for young people who are looking to retire many, many decades from now. in 1983, we put social security on firm financial footing and it's one of the things that i'm proudest of, you know, in my professional career. i think the challenge is you mix it with deficit reduction and it confuses the issue. there is -- there are people who think that social security is the cause of our deficit. it's not the cause of our deficit. social security ran a surplus for decades. 1983, the principal in 1983 was have enough income come in so that we can build up reserves and then when the baby boom retires, draw them down. well, through that period we didn't honor that trust. you know, instead of taking the surplus that we built up in the 1990s, we spent it as a country. so it's not fair to say social security caused the problem. now, social security, obviously,

is something we have to deal with. as social security needs to draw on its reserves and those reserves aren't there because we spent them, you have to either raise revenues, cut spending or borrow money. so it's contributing to the situation. but it's, i think, a fundamental mistake to say that social security caused it. i think it will -- it will complicate and slow the process of social security if the two issues are merged. now, if you separate them and the question is how do you deal with social security? i think that there is -- it is true that if you took people from opposing views and said you're not constraint by the kind of political arguments that your sides have made, can you identify options where reasonable people could agree, it is much easier than other areas. it's an acuarial program where you can fairly easily calculate when the income is, what the number of people is, what the outflow is. the problem is, you know, we're not in a place right now where a

conversation can be had where everything is on the table. revenues as well as spending has to be on the table to have a serious conversation about social security. in '83 it certainly was a combination of the two. so the president, i think, laid out principles that are very clear and speak for themselves in terms of how to deal with social security. he very much means it when he says he wants to do it now. and i think it's an invitation for everything to be in the discussion and not to start out by saying it's all going to have to come by cutting benefit. ..

>> what we do with social security requires that again, and the less proposals we have with everyone with hard positions and taking everything off the table, the more likely we are to solve the problem. >> jack, thank you very much for your time. let me give you a gift. [applause] this is a map of the district of columbia from the original district. thank you, all, very much, thank you, jack. [applause] >> thanks, i appreciate it. [inaudible conversations]

>> american children who were ab ducted and taken to other countries was the focus of a hearing on capitol hill on tuesday. they heard from david goldman, whose son returned from brazil in 2009 only after being abducted five years earlier by his late wife. hear from other parents whose children were abducted with international law and child custody. >> thank you very much. we'll focus on the troubling issue of child abduction which occurs when one parent unlawfully moves a child from his or her country of residence for the purpose of denying the other parent access to the child. it is a global human rights

abuse that seriously harms children while inflicting excruciating emotional pain and suffering and left behind parents and families. it rips children from their homes and lives, taking them to a foreign land forcing them to leave a family they love. a child is disresulted in in limbo, or in hiding as the taking parent seeks to evade the law or conjure cover for their immoral actions. children lose their relationship with their mom or their dad, half of their identity, and half of their culture. they are at risk of emotional problems and may experience anxiety, eating problems, nightmares, mood swings, disturbances, guilt, and resentfulness. as adults they have identity

issues, struggle in their own personal relationships, and parenting. they ratified the hague process to address this serious issue. the convention creates a civil framework for the quick return of children who have been abducted and for rights of access to both parents. under the convention, courts are not supposed to open or reopen custody determinations, but rather decide the child's country of ha habit yawl reference. after the circumstances, the child is to be returned within six weeks to their residence for the courts there to decide on custody or to enforce any previous custody determinations. this framework is based on the premise that the courts where the child was living before the abduction have access to evidence and witnesses and the

appropriate place for custody determinations to be made. however, even though more than 80 countries have signed the hague convention, the return rates of american children are still devastatingly low. in 2010, 978 children were abducted to hague convention countries and 680 children returned, only 30%. some countries are not enforcing return orders. the hague convention compliance report highlighted 15 countries, argentina, australia, austria, costa rica, france, germany, israel, mexico, romania, south africa, switzerland and turkey for failing to return orders. other countries, honduras, mexico, bahamas and others fail

to abide by the conventions concerning the central authority charged with implementing the convention, the performance of their jew judiciaries and implying the hague convention or willingness to enforce law enforcement to ensure swift enforcement of orders issued under the convention. some taking parents will try to dprag out proceedings for so long that the child reaches an age where a court will consider the child's wishes regarding a return and david goldman and others experienced that very infamous tactic. tragicically they are victims of alienation where the taking parent fills the child's head with lies out the left behind parent. if the child was not of an appropriate age to be heard when abducted, the taking parent should not drag out proceedings or motivated to psychologically manipulate a child and harm a

child, but manipulate the child to testify he or she does not want to return to the left behind parent. countries that permit the practices encourage the child abuse known as parental alienation. in 2010, the united states lost 523 children to countries that have not signed on to the hague convention and received back 228 of those kids, a return rate of some 45%. japan has by far the worst record of all. it has not issued and enforced a return order for a single one of the more than 321 american children, 321 american children abducted there since 1994 when the recordkeeping began. japan is protecting the abductors of 156 american children under the age of 16.

we will hear from some of their left behind parentings at this hearing. japan announced this week that it is introducing legislation needed to ratify the hague convention, however, i am very concerned that japan will add exceptions and reservations to its ratification that would render its ascension to the convention meaningless, and tragically and unbelievably, japan already indicated its approval of the convention will be meaningless to the 156 american children already abducted to japan. the hague convention is not retroactive unless japan makes it retroactive. i and members of the committee strokely urge japan not to ignore the children already within its borders. just this year, united states lost 31 more children to japanese abductions. i can assure japan that the

hundreds of left behind american parents whose children are in japan are not going away, and if japan signs the hague convention. japan will not move past its reputation here in the congress and elsewhere as a safe haven for child abductors until japan returns all abducted children. these 156 american children are bereaved of one of their parents. they cannot be ignored nor will they be forgotten. in the last congress, i introduced legislation to impress on hague and non-hague countries alike that the united states will not tolerate child ab or have patience with countries behind the hague convention. i introduced a bill of 2011, and the new bill, hr1940, empowers the president and department of

state with new tools and authorities to return the abducts american children. under this new proposed law, when a country has shown what we call a pattern of noncooperation in resolving child abduction cases, the president will be able to respond decisively with a range of actions and penalties, 18 in all. i included penalties that we included in 2000 in the trafficking act on the prime author of the legislation it worked in combating human trafficking, it will work in combating international child abduction. also included language taken right from the international religious freedom act enacted in 1998 which went through my committee sponsored by frank wolf. that, too, has worked to promote international religious freedom by having a penalty phase without which we can admonish all we want, but we have to have

something carrots and sticks to ensure compliance. based on past experiences i say, penalties get the attention of other governments, and we know that they work. also reflecting my anti-trafficking legislation, hr1940 raises the profile of the international child abduction issues by appointing a new ambassador at large for international child abduction to head a new office charged with helping left behind parents secure the return of their children and to collect detailed information and report on ab ducted children in all countries. this has to be taken to a much higher level, and we have to put the full force of penalties and the ambassador rank behind that effort. the growing incidents of child abduction must be recognized for the serious human rights violation that it is, and decisive effective action is

urgently needed. our hearing this afternoon will help us all to understand better the impact a child abduction has on children, parents, and entire families and provide us with the opportunity to explore the actions needed to end it. i'd like to yield to my good friend and colleague, don payne for my comments he may have. >> thank you very much. let me begin by commending you by calling this timely hearing. as many of us know, tomorrow is national missing children's day, and it is fitting to examine a problem of child abduction in an international context. losing a child is a terrifying experience for any parent regardless to where they live anywhere in the world. unfortunately, reported cases of international child abduction are on the rise. in fact, a number of cases

involving a child, a kidnapping kidnapped out of the united states to another country that signed a hague convention doubled since 2006, two times more in simply five years. the troubling trend of international child custody disputes will deteriorate as we are more interconnected and mobile hopefully. these cases warrant vigilance and action. currently the hague convention on the civil aspect of international child abduction, with 85 participating countries, is a principle mechanism for enforcing the return of abducted children, though imperfect, the convention resolved many abduction cases and put countries to promptly return children to their rightful residence. through the convention, for example, the united states government successfully returned

26 # children -- 262 children abducted to or wrongfully retained in the united states in 2010 alone. nevertheless, as all of our witnesses will testify today, key challenges remain. for example, the conventions available and remedies do not apply to countries that leave parents like my witness, colin with limited resources and support. colin, i thank you for become here and willing to share your disstressing personal story in providing us with insight on the hardship and difficulties of regaining children abducted to egypt, a country that chose not to participate in the hague convention. many here in congress are concerned with your case including my friend congressman barney frank who was here in the audience, and i'm sure that the chairman will invite him to come

forward to sit on the panel if he chooses, who along with my colleague mr. smith, introduced a resolution calling on egypt to return your children. i want to thank all the parents here today for sharing their stories with us. furthermore, the convention promotes the prompt return of abducted children, long delays are often and still too common. we are not satisfied, and often parents of abducts children still face protracting legal battles with prohibitive legal costs. although international parental child kidnapping is a federal crime in the united states, the convention also fails to impose any criminal sanctions on the abducting parent. despite the serious danger such action poses to the mental well-being of the child. the international presential child abduction deterrence agent of 2009 introduced by my

colleague from new jersey, representative rush holdt, in which i co-sponsored, it's designed to detour foreign abductors by increasing the penalties associated with such abductions. proposes punishments against the abductors include freezing assets and foreign nationals within the united states jurisdiction or denying their visa eligibility into the united states. i look forward to your analysis of the convention, and the opportunity for improvement including u.s. legislative options. as we reflect op the risks abducts children face intergnarlly, i would like to further draw further attention to africa where times weak governments, poor legal, and judicial systems and widespread poverty prevent adequate country response to child abduction and

trafficking cases, and leave children especially vulnerable. globally children in conflict, post conflict, and natural disaster crisis are especially at risk for child abduction or its pernicious counterpart, child trafficking. in some african countries like sudan and regions in that area, such as the countries in northwest africa, abduction into slavery remains a horrendous practice. child abductions between epic factions and the sudan conflict and especially of dinka chairperson from the north to the -- children from the north to the south speak to the conflict. as a matter of fact, we got involved initially in the sudan crisis even before war really broke out because of the ab

duction of children who were sold into slavery. in other conflicts like in somalia and central africa republic amongst others, children are still at risk for abduction and con forcible to being child soldiers. french aid workers attempting to remove chaddian children whom they falsely flame were often sudanese refugees and the southern baptist military attempting to remove haitian children two weeks # after the devra devastating earthquake claimed to be orphaned and remind us of the need to be protected in post-disaster area. i look forward to your post phase and recommendations on how to protect children from

abduction and trafficking when they are in the most vulnerable state. i look forward to hearing the witnesses, and with that, i yield back the balance of my time. >> thank you very much, don. we have two roll calls on the floor. we'll run over, vote, vote on the second one and come back. we stand in recess pending the votes. [inaudible conversations] [inaudible conversations] >> to the subcommittee, beginning with mr. david goldman, the father of shaun goldman born in redbank in 2000. was abducted to brazil in 2004 and he spent five years spending

e numerous amount of times and resources and had a great number of people supporting him in the community to secure the return of his son. in december of 2009, i had the extraordinary privilege of being with david and shaun when they were able to return to the united states. mr. goldman recently published a book about his ordeal entiled "a father's love" and he's been a trail blazer in opening the eyes of country of the agony endured by left behind parents. he is the human rights abuse of child abduction. we know about it, worked on it, many of us for many years, but it wasn't until david goldman opened the eyes of members of congress and hopefully other policymakers around the world that they realize just how the hague convention is often gamed by countries, in this case, brazil, where endless appeals

can be launched by the abducting so-called family, the kidnappers, and frankly that process can be carried on weekend after week, month after month, year after year, precluding the return of abducted family members. he really refocused a movement that he launched by his leadership, and i want to thank him for it. all the other left behind parents have been tenacious in their own right, but the breakthrough case, i think, will help everyone else, and that's our, i think, the subcommittee's hope. i would like to introduce sarah edwards, a mother of a 3-year-old, and eli's father took him to turkey in 2010 and refuses to return him to his

mother. she works in ohio and is seeking concrete assistance in navigating the ob kls -- obstacles of her fight. we have another parent who is on his way, not here yet, but i want to ask mr. gold man to freed with his testimony as he would like. >> thank you. let my take us back in time a little bit. good afternoon, members of congress. i'm honored for the privilege to testify before you today. for five and a half years, i walked in the shoes of the left behind parent. i lived in a world of disupon den sigh and december per ration and a sering pain through my being and everywhere i turned i saw my ab ducted child. sleep was hard to come by.

if i smiled, i felt guilt. when i saw children, whether it was in the store, a park, or on television or on my charter boat where clients take their families for a day on the water, it was more than painful. it was too painful to be around my own family members or could not be around my nieces and nephews. it was too painful. where was my son? where was my child? he had been abducted. he was being held illegally. he was being psychologically, emotionally, and mentally abused. i needed to help him, to save him. he needed me, his father. it was our legal, miranda moral, our god-given right to be together as parent and child. i did everything humanly possible leaving no stone unturned, but for many years, the result remained the same, shaun was not home.

although i remained determined and hopeful, i must admit the outlook for a permanent reunion with my abducted child often seemed bleak at best. i felted like a -- i felt like a dead man walking and i was a shell of the man i once had been. there were orders in place. there were many orders from u.s. courts demanding the return of my child. the courts in brazil acknowledged my child was held in violation of u.s. and international law. however, he remained in the possession of his ab duct tore -- abductors. where were so many laws ignored and why was the government of brazil allowed to violate international law with no consequences? why were my child and over 50 other american children still in brazil?

another 80 or more in mexico and thousands of other american children also held illegally in various countries in clear violation of the hague convention on the civil aspects of international child abduction. it would take four and a half years, numerous court hearings, extraordinary work from my attorneys in brazil and the u.s., one of whom is here today sitting behind me, ms. patricia apy, who will testify. tremendous amounts of pressure applied and house and senate state resolutions for me to be able to visit my abducted son for a few short periods of time. my son had been abducted by my wife and her parents and held illegally for over four years. it wasn't until the tragic passing of his mother that my son's abduction became newsworthy. this finally brought it to the attention of those who could and

would actually assist me. it took congressman smith traveling to brazil with me. it took senator lawsuitenberg holding up a bill that would have given brazil nearly $300 million in trade preferences for my son to come home. we are extremely grateful for all the assistance we received from supporters, elected officials, the secretary of state, and the president of the united states of america. nevertheless, it is extremely rare for a left behind parent to be the beneficiary of this level of help, yet every other parent whose american citizen child has been abducted deserves the same help that i received. this committee must realize that if the system had been working properly, our government would have had the tools necessary to bring shaun and all of the other

abducted children home years earlier. it should not have required the extraordinary efforts of congressman smith and senator lautenberg. he shouldn't have needed to threaten a trade bill with brazil because that option should have viable when countries violate the law and refuse to return abducted children. as of today, there's many black and white hague cases and other countries where the law is clear that the children must be returned. my case was the exception because the abducting parent had passed away, but almost always the abductor is still alive. these abducting parents and their attorneys manipulate the legal system to their advantage stalling legal processes for years while our children grow up apart from half of their families. for these left behind parents and families, time is the

enemy. with all the assistance and support i received over four years and then another year and a half after the death of my son's first abductor, on christmas eve 2009, shaun and i were finally reunited and returned home. it was nothing short of a miracle. after five and a half years, my sop's illegal retention and documented abuse, he is now home, and he is flourishing. he will be 11 years old tomorrow, may 25, as congressman payne pointed out, my son's birthday is on international missing children awareness day. although the remaining abductors of my son challenged the supreme court's decision that brought him home and continue litigation seeking my sop's return in

addition to filing lawsuits in normings courts, he is home. he is happy. he is loved. he is allowed to be a child again, and we are father and son again. one thing my father said when my son and i timely returned home which will always resinate within me and how parents and families live every day, my dad said, not only did i get my gradson back, i got any son back. our family will always be so very grateful for every ounce of support from wherefore is came. it is for this reason that i am here today to do whatever i can to ensure the pleas from the remaining families desperately fighting to reunite with their children. do not fall on deaf ears as my own pleas did for so many years. our foundation is assisting a number of left behind parents

including nine whose children are illegally held in brazil. they have not been abducted by those of great power like my child, but the results are the same. the chirp remain held illegally. other than my sop, we are aware of no other child returned to the u.s. by brazil under the hague convention. in fact, since shaun's return, two u.s. cases in brazil received return orders by the first level federal courts which is good news. however, the rulings were appealed, the children were not returned, and the lives of the left behind parents and chirp hang in the balance while every day the abductors live with impunity as the cases drag on. brazil continues to defy international law. i would like to note that ambassador jacobs recently returned from a trip from brazil

to discuss international child abduction with here senior officials. she reports the trip was a success and that the u.s. and brazil have established a working group which will meet this summer to discuss how to speed up hague applications and the adjudication of these abduction cases. hopefully, real change will happen, but to be clear, the only way progress can be measured is by the number of american children who are returned. right now, there are zero, zero consequences when a nation violates the hague convention and refuses to return abducted children to the united states. nations including mexico, germany, brazil, and japan which finally appears ready to ratify the hague convention discover quickly that united states is all talk and no action. these countries play endless

legal and diplomatic games with left behind parents frustrating their hopes and breaking their hearts month after month and year after year through endless bureaucratic maneuverings. the method and the excuses may vary from one country to another country, but the results are almost always the same. children illegally abducted from the united states almost never come home. the current system is broken. in the letter inviting me to speak at this hearing today, the chairman states that the purpose of this hearing is to explore ways the u.s. can help increase return rates of children abducted internationally by a parent. first of all, we can only help increase return rates if we start with a complete understanding of the full mag magnitude of the problem including the true number of american children who were abducted and continue to be illegally retaped abroad.

this is a difficult number to find, and it is not presented as part of the annual hague compliance report submitted to congress by the state department. we keep hearing that the figures are around 2800 american children. however, the last three annual hague con -- compliance report shows the total number for american children was 4728. these reports also show about 1200 chirp were returned, although we were not able to find return data for 2010. that would account for an increase of 3528 abducted american children in those three years alone, and clearly there has to be literally thousands of american children retained abroad whose abductions date back to the most recent three

year period. how are returns categorized? how are the children returned if they were, in fact, returned at all. do returns include cases that the state department closed for various reasons? if so, what is the criteria for closure? things need to change. we need a system by which these abduction cases are registered and monitored by each parent's elected member of congress. we need elected officials to work closely with the state department on these cases to be sure all resources and additional tools are at their disposal to make it clear to the countries that we want our children sent home. there is no valid reason for foreign governments to illegally hold american children and support international child abduction. this statement, however true, defies all logic because there is never a valid reason to break the law and support kidnapping,

but as i testify before you today, this is exactly what is happening in many countries to thousands of american children and their families. these countries are breaking the law with impunity. the fact is very few left behind parents will be as fortunate as i was in having president obama, secretary of state clinton, congressman smith, and senator lautenberg all make my son, shawn's run, a policy goal of the united states. even then, senator lautenberg had to put a hold on renewal on gsp privileges including brazil to put the final pressure on both brazil and the administration which led to shaun's return. i wish every left behind parent could have that support in the future, but we all know that few, at most, and probably none

will have that leverage and power backing them. what kind of leverage will these parents be able to wield without that kind of perm high-level support i was fortunate to receive from the white house, state department, senate, and house to bring their children home? not very much. in fact, probably none at all. the hague convention has the force of law, but we all know there can be no rule of law if there is no system of justice to punish violaters. today, mexico, brazil, argentina, and a host of other countries face no real consequences for reducing -- refusing to adhere to the hague convention requirements that abducted children be returned to the country where they were illegally domiciled within six weeks. american treasure and armed forces safeguard the security of japan, and yet japan pays no price for refusing to return the

abducted children of the american service members as well as ordinary u.s. citizens whose children have been abducted to japan. this committee and this congress must pass legislation that arms the state department with real sanctions to exempt other nations which remain flay gaunt violaters. i support the legislation, and i urge all members to do so as well. similar to our anti-human trafficking laws offered by chairman smith, his bill to combat international child abduction provides a real and credible up venn story of -- inventory of sanctions to be used to get our kids back. if you arm our negotiators with sanctions, they will be immediately taken more seriously. if the department employees such

sanctions against the worst offenders, other nations will get the message also and hopefully start to return our children. what i do know is that if all we do today is express outrage and vow to do better as committees like this in both houses of congress have done for more than 12 years, but fail to enact congressman smith's legislation with real sanctions, our kids will not be returned, and we'll be back before another committee next year with more left behind families, more internationally abducted children, and no new mechanism for improve. . it is worth noting this is the 7th hearing on this issue since 1998, and i respectfully ask this committee to think about something at the conclusion of this hearing. what, if anything, has changed in those 12 years since we acknowledged the seriousness of the problem of international

child abduction and realized that the system was failing these parents back then? when you read the testimony as it is if we are stuck in a time capsule and the dates on the hearing transscripts don't matter. all the stories could be told today because the reasons for the failures are the same. this is as much of a bipartisan issue as there could ever be, and i continue to plead on behalf of all the suffering families torn apart by child abduction, for our government to act now. my son, shaun, and i, can never get back the time lost because of his abduction, but now that he's finally home, not a day is lost on either one of us. let us help the rest of the families and begin with providing the much needed tools that the state department so

desperately needs to apply across the board pressure that will ensure abducted american chirp come -- children come home. i would like to conclude with a letter from the left behind parents of 117 american children unlawfully retained in 25 countries. the letter is addressed to secretary of state clinton and was written for the purpose of giving a voice to the thousands of parents who are not invited to speak here today. their presence is felt and many of them are here in this room today. if i may, i'd like to read the letter? and if any parents or families would like to stand with me -- if the room were bigger, there'd be more families.

>> microphone? >> if this room were bigger, you could be assuredded there would be more parents and families making it even harder. dear madam secretary, we the undersigned, appeal for your help as left behind parents of 117 american children who have been abducted and remain unlawfully retained in 25 countries. we also represent a number of u.s. service members whose children were abducted while serving our country overseas. some of these countries are cig stories to the hague convention while others are not such as japan where we face overwhelming odds trying to reunite with our children. we are devastated emotionally and financially by the loss of our children and seek your assistance in ensuring that the u.s. government is exercising all lawful means necessary to return these american children

to their home country and reunite them with us. the continued retention of our children violates international law, ethical norms, and human decency. put simply, our children have been stolen from us. it is our legal and our moral right to be a part of their lives. as our 85 cases demonstrate, there are a growing number of countries willfully ignoring or abusing their obligations with regard to international parental child abduction. each of us has had exas per rating experiences seeking justice in foreign courts where our cases are treated as custody matter, rather than abduction cases. oventimes, victim parents and court systems of foreign countries when it is well-known that such action will likely result in a decision with custody of our abducted children being awarded to the abducting

party. collectively, we have limited or no contact with our children, many of whom turned against us as a result of parental alienation, a documented form of child abuse. our children loss half of their identities being ripped from homes, families, and friends.. like us parents, our children's grandparents, siblings, aunts, uncles, and other family members have holes in their hearts left by the abduction of their loved ones. we were encouraged by your july 2010 appointment of ambassador jacobs of special adviser to the office of children's issues, however, in working with oci, there's been little improvement in the quality of service provided by the department of state and almost no positive results. the current system has failed us. while our children remain

unlawfully in foreign lands, the number of new cases in the u.s. comets to grow -- continues to grow at an alarming rate. there's an urgent need for change not only to prevent more children from being abducted across international borders, but also to effect the safe return of our ab ducted children. international child abduction is a serious human rights violation and desperate need of your attention. in our experience, all too aifn, these international child abduction cases do not appear to be addressed aggressively because the state department's effort to maintain harmonious bilateral relations with other countries or to pursue other compelling -- [inaudible] the state department's manual highlights this point by strucking caseworkers to remain neutral when handling the

abduction cases. this inherent conflict cannot be ignored and we need to place a higher priority on our children. we understand the necessity of maintaining strong relations with other nations, but this should not come at the expense of our children. over the years, both houses of congress have held numerous hearings on the issue of international parental child abduction, yet precious little has changed as our absent children grow older. on tuesday, another group of parents gather in washington, d.c. for another hearing as we are today. it is our hope that this will be the year that the congress and administration unite to pass new laws to strengthen the country's capacity to help parents with children who were ab ducted. we hope the state department under your leadership embraces

the changes to end this gross injustice affecting thousands of american children. madam secretary, we applaud your past efforts and record on children's rights issues, but we are desperate and plead for your assistance. it is long past time for this great country to show leadership of the issue of international parental child abduction. we cannot grow come place i want with each successful return or forget the children who are wrongfully obtained abroad. we have strong support of groups who advocate for victims of international parental child abduction, however, we need our government's unwaiverring support and determination to bring our children home. madam secretary, we would welcome the opportunity to meet with you directly to discuss how progress can be made. please help us reunite with our

children and the families and the names of the children are at the end of the letter. >> thank you. without objection, all the names will be included. [applause] >> thank you for your very powerful testimony for speaking and articulating the deeply held views of virtually everyone in the room and all those who couldn't be here. i would note this is the beginning of a series of hearings. we will hear from other left behind parents in subsequent hearings. there's three panels today because every single one of your situations needs to be aired, needs to have the full backing of our committee, which they do, in order to hopefully, god willing, get the return of the left behind children. i want to yield to ms. buerkle,

the distinguished gentlelady from new york. >> thank you, mr. chairman, and thank you for haling this hearing that will benefit with more action from the congress. the testimony from the witnesses is heart breaking. as a mother of six, i can only imagine what the pain is when a child is abducted by a former spouse, and it's probably the worst nightmare a divorced parent could face, and i want to applaud the vigilance and persistence of the left behind parent in your pursuit to get your child back. reading through the testimony was eye opening and especially disturbing was the nonreturn rate for the hague convention. in 2010, the return rate to the hague convention was 7% lower than the non-hague convention countries. last year alope, the state department handled 1501 child

abductions for u.s. residents. we have to do better, and this congress will do better, and i assure you with our chairman here, we will do better. thank you, and i yield back. >> thank you. i want to thank ms. bass for joining us as well. i want to recognize ms. edwards and proceed as you would like. >> i'm sarah edwards, and i'm the mother of a 3-year-old boy named abdullah eli. he gives the best bear hugs, but i have not held him since 2010. my husband, the boy's father, took him to turkey for a family visit. we met while both in college and married in ohio in 2003. our son was born five years later while i was in graduate school at the pennsylvania state

university. my family and parts of muhammad's family lived in ohio, and when he was six months old, we moved back there. in january 2010 after seven years of marriage, we separated. we drafted an informal agreement to outline the intentions for raising our son. i believe this document was a framework for us to work together as separated parents in raising eli. we acted under the plan that called for custodial time of alternating weeks with us visiting two days a week with eli during the visitation. i fully believed that the participation meant he was committed to shared parenting as i was. therefore, when he wanted to go forward with the visit to see his family in turkey and take eli, i did not object. i thought it would be good for him to have support from his family during the separation. he provided me with round trip

tickets and a travel io ten yarr and a signed statement promising to return with the son. they were to be there two months in turkey, and 14 months later, he is still not home. i don't want to be without my son for two months and knew i would miss him more than anything, but i thought it was important for the son to know the turkish family and have exposure to that culture. i wanted to be fair. i traveled to turkey five times before he abducted eli. on two of those times, eli came with me and also stayed for two months during the visit. it all seemed routine. i drove them to the airport on the day of their travel and i was there as they went through ticketing and security. i blew kisses and he waved bye-bye. excuse me. as i hold on to happy last look at him, he deceived me from the moment we decided to separate.

for the first two weeks of their trip, i visited with him daily, but on march 22, my nightmare began. he told me he would bring him back to ohio if i declared myself an unfit parent. he got a divorce and there was not a thing i could do about it. the next day, march 23, 2010, i accountanted department of state national crime center, american embassy, turkish consulate and scores of attorneys across turkey and the u.s.. it is certainly now clear he never intended to bring eli home. he traveled to turkey on march 6, and on the 10th of march, four days later, he atepidded a divorce hearing. one day later, march 11, 2010, the domestic court of turkey granted full custody of our son. he got full custody in a divorce

in a domestic court in a country where we never resided. according to law, i how far been present for the divorce hearing. not only was i not present, i was never informed or had contact with the attorneys who was supposed to represent me. i had no hard evidence a case took place until he filed the rulings as evidence and there was a custody case. to date, he continues to ignore the summit county court order to return eli to ohio. the judge signed the order adopting our original shared parenting plan in june 2010, and we are still legally married in ohio. my turkish petition submitted to the central authority on january 24, 2011. i have learned that the turkish authorities investigated the where abouts and this month they opened a case on my behalf in

turkey. i await updates daily and desperately. over the past 14 months, he has permitted me to visit with eli by web cam sometimes on a regular basis, but cuts off access for long periods with no warning. i succeed yulely life around the chance to speak with my only child. in my dispair or elation turns upon his whim. my son no longer understands or speaks english, and i struggle to keep up with him in tushish but grateful for the contact and bond. ally was 2 when he took him, and now at age 3, he's growing and changes drastically with each visit. i wonder if he thinking about me and missing me the same way i think about him and miss him. he threatens to take him to syria torturing me with every web cam visit and it could be

the last time i ever see eli. the obstacles i face fighting the abduction of my son are great. i'm essentially on my own to fight a court battle in a foreign country where i do not know the language or understand the culture. i have to be continually vigilant in maneuvering this case in fighting for my son. to date, i do not know whether eli is issued a tushish pass passport. no one gives me confirmation he will be questioned if he tries to leave turkey. no one gives me confirmation if he will be questions to return to the u.s. to renew his status. these are things we can know. these are obstacles that are ahead that need to be avoided. these are things we can do. i love my son more than anything in this world, and i am ready every minute to welcome him home, and i permly ask you now to commit to do with all the

strength in your power to restore the right of our children to have relationships with both of their parents. thank you very much. >> ms. edwards, thorning. -- ms. edwards, thank you. [applause] thank you so much for sharing that. we now welcome carlos bermudez who is the father of sage who was born on may 14, 2007. sage's mother abducted him to mexico in june of 2008. he spent three years trying to bring his son to north carolina. his testimony is the fact he continues to do so just like all the left behind parents struggling to reclaim their children. >> in support of mr. goldman and advocacy of all families affected by this is something i respect greatly. i'm grateful for your efforts and honored to have the

opportunity to address this committee. my only son, sage, was born may 14, 2007. i spent the months proceeding his birth rearranging my priorities around fatherhood and awaiting his arrival. he would be the most important role in my life. in 2008, i missed increasing signs something was amiss with my wife. i had questions about our long term rip and was at a loss of what to do and maintaining a hard work schedule to provide my family. . .