abide by them or we're just not going to be there for you. and the it's time we use our influence, the bully pulpit and didn't get caught up. so many people in this town that are devoted to this issue. i mean, i made a living off of it for 35 years. i can't imagine how many others in this city have. we just have too many other issues in the middle east that require our attention. >> well, i have a lot of sympathy with that view. i think in a way the high point -- or what i would view as a proper american policy came in 2002 when president bush essentially said to the palestinians, we will support palestinian statehood fully when you have met a series of preconditions. new leaders, not compromised by terror, a practicing democracy not by the way one that simply

cancels election after election after election. a practicing democracy based on tolerance and liberty. when the palestinian people have achieved it and new security arrangements with their neighbors, egypt, jordan, israel then the united states will support the creation of a palestinian state whose borders and sovereignty will be provisional for a while. in essence, that's what goes into the roadmap. i think the united states should stop -- i can use another bush phrase treating the palestinians with the bigotry of low expectations and start making demands, the kind of demands that in a sense the professor was referring to, demands about teaching the palestinian people to prepare for peace, both in the statements of the leadership and in things like public schools, textbooks.

'cause i think that's -- that would be laying a real foundation for piece and meanwhile we should continue to support the institution-building efforts that are underway. >> i don't disagree with what my colleagues have said. you know, with regard to the peace process, again, as sour as i am on what's transpired over the last 20 years, and what was nut place in terms of the plo able to reclaim control with territory next door to israel, rate that level of tyranny and dictatorship that they did, the amount of weapons that were allowed to go in there and the amount of deaths that have occurred over the last 20 years on both sides really quite

dismaying. i do agree we need a transformational moment on the palestinian side that hasn't come yet, although it was supposed to have come with oslo in 1993. i think it's instructive that the moment we thought we had had in 1993 with arafat came under, you know, quite specific circumstances in which the united states had in effect won the cold war, the soviet union was defeated. we'd won a real war, a hot war in iraq and defeated a middle eastern tyrant that arafat had supported and we continued with negotiations with palestinians outside of the plo. and it was only in that context that arafat swallowed hard and made the decision he did to at least mouth the words that he was recognizing israel to put himself back in the game through

the oslo process and the secret negotiations with prime minister rabin, that occurred and i don't think there's any direct application to -- our approach toward the palestinian issue today but i think there are instructive things we can learn including that perhaps the most important role of the united states -- while it's important and i think essentially on the peace process i don't buy any nonsense that the palestinian gambit in new york signals the end of the peace process i think it's true now as it was 20 years that the door to real peace and a real settlement in the middle east only goes through israel. and because it goes through israel, it only goes through the united states as the essentially guarantor of that process and the guarantor of israel's security and israel's ability to take risk for peace. but beyond that, i think the real critical function that

united states and the very helpful role it can play is shaping a strategic environment in which the parties either feel that they can take risk for piece or that they have no other choice but to take risk for peace. and i think in particular and in the current strategic environment, first and foremost that means a continuous american priority on the danger and threat posed by iran. i think it does mean leaving iraq in a stable situation as a continuing developing economy and that does mean a continuing relationship with the united states and i think it clearly means following through and doing whatever we can to ensure some kind of -- as orderly a transition as possible in the arab countries that have undergone all of this turmoil

first and foremost i think that means egypt, egypt and the fate of egypt and the future of egypt dwarfs ever importance in time and energy we're going to spend on the peace process in the next several years trying to get egypt right and ensure that egypt's strategic orientation continues in a way that is at least moderately sympathetic to american strategic interests in the region, i think, is absolutely essential and needs to be at the top. and i think if we get those kinds of things right that means we go a long way of fulfilling an environment in which israelis and palestinians can actually have any a chance of moving forward in a constructive way. >> that was some of the discussion from earlier today. back now, israel and the u.s., the main focus of the discussion going on in this room on capitol

hill today and we're back live with the hudson institute. we'll be hearing shortly from author george gilder who wrote the book "the israel test." you're watching live coverage from the capitol visitors center here on c-span2. [inaudible conversations] [inaudible conversations]

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[inaudible conversations] >> we'll get started here. and we'll get started. thank you very much. there are a few people that i know and probably a few people that you know whose minds are as fertile and whose careers have been as varied as has george guilders. he has over decades focused his considerable intellect on a wide range of disparate issues.

as many of you will know back in 1981, his book "wealth and poverty" was an important argument made for free market economics, utilized by the reagan administration to change the economic situation of the u.s. at a critical time. he's examined government welfare policies, the impact of feminism. and in the 1990s his interests turned to technology and the internet. and his writings on that were nothing short of brilliant. two years ago in 2009, he wrote a book called "the israel test" which is an extraordinary work. he said it was about the cosmic law between success and envy. no one is better to discuss the u.s.-israel relationship, the importance of it, what's happening to it and what needs to happen to it than george

gilder and i'm pleased and honored to introduce george to you today. thank you. [applause] >> thank you. i've been reading cliff's columns with increasing interest and a recent one that i recommend to all of you, if you haven't seen it was entitle "borrowing from the communists to pay the jihadis" and he pointed out that the president of opec and he's the senior commander in iran's revolutionary guards. so we have this picture of opec extorting ever more funds from the united states to fund the jihad against the west.

and at the same time, the communists lending us the money and now becoming restive about their $1.6 trillion of u.s. securities. and as cliff pointed out that this is something that we're doing to ourselves. by punishing and suppressing and restricting energy production in the united states. we are one of the world's leading sources of energy. we have more available energy technologies. we have the amazing breakthrough of horizontal fraccing, to tap both natural gas. there are trillions and trillions and hundreds of years of natural gas resources available in the united states. and yet we succumb to this incredibly self-destructive gavat of between china and iran.

recently, i've been noticing a kind of disoriention of america's leaders. i mean, we have a year or so ago, general petraeus maintained that somehow our relationship with israel was a problem for american forces in the middle east. general gates has declared that israel is a ingrate that they don't comply to american purposes and hillary clinton has made similar disgruntled

statements. that israel being a distraction in meeting the goals in the united states of the middle east. and this leads me to a question. it seems to me that america's enemies understand very well the centrality of israel. that there is nothing anywhere in the middle east, no resource anywhere in the region remotely as valuable, remotely as important, remotely as vital to the future and current interests of the united states as the israeli people. and particularly, israel with its current leadership.

israel survived the financial -- the global financial slump with scarcely a down quarter with nary a stimulus package and no financial crisis. they recently had in the face of an ascendant shekell and a worldwide boycott attempt, they've been increasing their exports every quarter by as much as 25%. they're in a massive export boom. they maintain global leadership behind only the united states. and as a venture capitalist i increasingly find that activities in israel are more promising in most ways than the current american silicon valley

activities which focus on social networking and twitter and facebook and such. the israelis are continuing to make massive contributions across the whole portfolio. there was a study of venture capitalists and discovered israel was behind only the united states. in the 60 areas of software, microchip, clean tech, medical instruments, biotech and this is pretty much what venture capitalists do. these are the frontiers of technology in this era. and tiny israel is second only to the united states in these

crucial fields. and that's not per capita. people talking about israel per capita. israel is off the charts and across-the-board for any intellectual activities per capita. but i'm talking about in absolute terms. that was the deloitte study. and it's readily confirmed by others. this is also a time when the world faces acute water crisis which reach a particularly extreme predicament in the middle east. you know, a proxy for importing of water is importation of grain. it's the kind of grain that entails a thousand tons of water, or something like that.

and lester brown's world watch believes that both iran and egypt, which recently just passed japan as the world's leading grain importer faced disastrous water crisis. and it's really almost unsoluble without radical depopulation according to world watch and lester brown. the water flowing into the middle east in the form of grain imports is comparable to the entire annual volume of the nile. having spent a lot of time in israel recently, however, i begin to know something about water. and the statistics of israeli water usage are just stunning and show that israel -- israel provides many of the solutions

for america's economic crisis, it also provides the key solution to the world's water crisis. over 60 years since israel was founded their population has increased ten-fold. their land use threefold. their agricultural output 16fold. their industrial output close to 60fold while using 10% less water than they did at the outset reducing water usage by 10%. as one leading israeli told me, we buy their sewage and give back totable water, the tap of israeli seuss -- sewage and

they lead the world in de saliniation and they have drastically the use of water in agriculture. they've succeeded in tapping brackish water below the desert and bringing it up and turning it into water useable for irrigation. just a miracle of efficiencies in water and that directly addresses a problem in the united states and around the world. california could learn lessons. but perhaps the more important issue that israel has had to face which makes it kind of a precursor and a canary in the minds of global geopolitical

scene is the fact that israel is currently targeted by 50,000 rockets, something like that. and increasingly missiles and oth other. this is probably the great pivotal change in the history of the world. that all the world cities have to confront. that cities are now vulnerable to attack by -- and devastating attack by missiles mastered by terrorists. and israel has over the last several years have developed its iron dome system which is using microchip advances to drastically reduce both the

weight and the cost of antirocket technology. and this iron dome which is antirocket system has survived several battlefield tests now and has succeeded in killing at most of the missiles it's been aimed at. you know, there have been scores of missiles fired into israel or rockets in recent months and iron dome has survived tium -- these attacks and it will be deployed all around israel and is in the process of being deployed all over israel. and it's also seoul and other cities also need this

capability. and this is rocket attacks, antimissile systems are also making that progress in israel and in the united states and a combination, the israelis and the americans work together on the aero system and these various phases of missile defense. and this is crucial. also, the use of ultra wide band systems for identification of terrorists, farm terrorists and urban conflict israel has made major advances that are vital. and contributions to drone technology which developing drones that can hover for long

periods of time following targets of interest. we've recently seen an example of the effectiveness of both the reconnaissance use of drones and the military use of them. and they are vital. you know, america's power in the world and our economic power does largely come from silicon valley and if you think of the key companies that represent america's strength, you think of intel corporation which is the world's leading semiconductor microchip company. you think of cisco, which provides the routers and switches that enable the

internet. you think of apple as the great consumer electronics leader. and most of the and google for optical capabilities and in my book i go through all these and the israel test and show that all of them are crucially dependent on israeli innovations, innovations by israelis in the united states or innovations supplied by the design centers which these companies have established in israel. intel is the most dramatic one. whenever i hear people complain that israel somehow hasn't created or sustained any large company, i think intel -- intel

is the leading semiconductor company in the world and int intel -- and intel -- intel from the beginning has been deeply and crucially dependent on israeli innovations. the 8088 microprocessor which was the original microprocessor in the ibm personal computer was the first processor designed at a -- at intel's design center in israel. it was founded by deb froman an israeli who developed the eprom which is the first solid state memory chip and which is evolve into flash memory and which

would make possible all the apple products, but the deb froman group designed the 8088 which is the ibm personal computer. the 8087, which was -- which was the mass coprocessor which made the ibm pc a business device as well as and the 386 and also these low powered processors and the centrino which connects us all to wifi and the atom which is intel's low power processor to go in smart phones and other

tele-puters. i could go on with all those stories. the leader of microsoft calls microsoft an israeli company and it recently supplied kieck -- kinect which is the movement center for the gaming system and kinect was the fastest moving consumer product in history. and the fact is that the u.s. is paralyzed and crippled by this vision of palestinian grievances. it's a myth but it persists. and this really is the problem

that leads people -- smart savvy people like gates and petraeus and even hillary clinton to make these fatuous statements about the american relationship with israel. the fact is that the palestinian territories, the territory that we -- that began as palestine, the british mandate before 1948 could not have existed to support a large arab population without the arrival of ultimately some 500,000 jewish immigrants before 1948. a very vivid depiction of this process was provided by walter

lautermilk who was a christian minister and scientists who was -- science and he was sent around the world to find solutions in the american dust bowl and the other problems of soil deterioration in the united states. and he ultimately arrived in palestine in 1938 and was just astonished by what he saw. and he wrote a book called "the promise of palestine" and what shocked him initially as a biblical scholar was the drastic

deterioration of this palestinian land since the early christian days when palestine was had perhaps a million people and was one of the more thriving areas in the middle east and a land of milk and honey we have all heard described. but by the time of -- when he arrived in 1948, he found half of the hills had been -- [inaudible] ..

hillside n. leaching soils and reclaiming the sandisk, which could support a tiny population and most of it afflicted could sustain 5.5 million. ultimately. but at the time he was there in 1940, there are about a million arabs and this was entirely the

result of the heroic work that he described the accomplishments of the jewish immigrants before the creation of israel. they massively expanded the absorptive capacity and dimensions of that territory. and during the course of the company barely bury stearate displacement. i mean, this is the opposite of displacement. the jewish development attract hundreds of thousands of arabs to the mandate territory and started ultimately a million arabs in the mandate territory. and water without trying of pin

down his argument by a comparison with jordan. and jordan has four times as large as israel. it has the same topography, the same kind of resources, more agricultural potential according to loudermilk. and in ancient times, it had several times the population of palestine. and when loudermilk wouldn't dare, jordan had one fit for consumption and aquaculture of production and one 10th the population of israel and density of israel. and what it happened was jordanians without the impact of the israeli who didn't come to

jordan -- there is heavy immigration to the u.s. and palestine from jordan. and jewish medicine and public hygiene resulted in a radical fall of the error death rate, a drastic drop in air at infant mortality. and as a result, the arab population in palestine was growing 16% a year, the fastest growing population in the entire world at the time of 1938 when loudermilk did this very day. and he said increasingly the conditions in palestine as a result of the jewish input resembled holland and denmark in terms of public health and hygiene. and then people imagine that

after 1967 hour after the creation of israel, where there was some terrible taste basement. but the fact is that the population of the air and steadily grew to the point that now they are five times as many as there were in 1940 within mandate territories. and when the israelis actually have administered the area, lake returning 1967 and 1990, it was a golden age for the palestinians, for the era palace ambience. their population increased threefold between 67 and t. 90. 261 new towns and what the population is exploding, their per capita incomes also tripled and six new university education prosperity and once longevity

increased from 48 years to 72 years. and so, this really -- the israeli presence in the middle east has been a tremendous turn to the palestinians above all. they have done the biggest beneficiaries of the israeli presence and heroic israeli contributions. and what happened was the last time delivered this country over to a small group of terrorists led by -- and who are nostalgic for the era not to use. i mean, it really was a group that read mine camp for

entertainment and enlightenment. and that really is what has happened, and i didn't fear of the success of the israelis in that region, the old not the movement and chairman of the plo and has since been attempting in to nullify this heroic israeli achievement. and i think that the israeli strain and economic potential and accomplishment is steadily expanding. and to the extent that we collaborate with this real and align ourselves with their great

achievements, we will succeed in the middle east. and to the extent that we preoccupy ourselves with this totally mythological mcnamara -- of the palestinians, we will be stultified and we will find ourselves first lien on the secondary and tertiary goals in the region, while actually rendering vulnerable are crucial ally and exemplar and source of strength in the middle east. which is of course israel. thank you. [applause] >> anything george is going to take some questions. >> sure, whatever. >> who would like to begin quite

ratepayer. >> george, where do you think the belief in the slowest narrative comes from? >> i think it is partly just ignorance of the importance of economics and the importance of actual scientific and technological pants. and preoccupation with political considerations, with ideals of democracy that are obviously important. but without a context of economic freedom and progress become almost meaningless. i mean, in the context of a sordid jihads even if it, the actual foolery sheen of human life becomes trivial.

and note that just aren't interested. as recently, the palestinian council here told the jewish daily, we aren't interested in improving the palestinian condition. we are interested in attending the settlement and really ending israel's. and that's really been the chief message. they've been very consistent about it altogether. and the americans just can't come to terms with that kind of adamant and hatred than this kind -- this kind of cool. >> over there.

>> on the first panel, the question was asked which they didn't answer was will the palestinian state he could for the united states? the answer to that vote differently. given your analysis at a palestinian state actually be good for palestinians? >> obviously not. i mean, the palestinian state already exists. it's called jordan and the jordanians are beginning to unveil the pressure a little bit and there is a wikileaks disclosure of some kind of wisp of american plan to incorporate jordan as a solution to the palestinian problem. but jordan is the palestinian state. it was originally the palace tinian state and i don't think any solution is possible without

the participation of jordan. and jordan, which is 50% palestinian already and ethnically, you know, can't absorb these palestinians without the help of israel. and that's the predicament. >> asked to the anti-fat outcome of the 2000 israel closed its borders to palestinians from the west bank who have previously commuted to jobs in israel. and of course they have been replaced by filipinos and koreans and others. what was the impact of that on

the palestinians? >> well, i mean, as i understand it, they still pour into israel every day through these check points. i've watched them glumly precede through these rather humiliating processes that we have to experience to enter this building. and that's the way of the royalties days,@did check points and passageways. but this certainly, you know, the more the palestinians are separated from israel, the worse their prospects become. the arab-israeli the most prosperous as arabs in the

middle east. and they are per capita a family income of about $14,000, compared to an average of $9000 in the rest of the middle east. you know, there are prosperous arabs and they know that. and there is this illusion that somehow you can have prosperity without opening yourself up to interchange and enterprise with your neighbors. and if you think working for an israeli is a humiliation, sec a lot of reference to the humiliation of the palestinians having to work for israelis, then obviously you can't have economic success or longevity are prosperity.

>> a question over here. [inaudible] >> do you think hamas -- for palestine trying to reach a conclusion, it's trying to negotiate all the time. she think hamas is beneficial to reach this conclusion? do you think hamas doesn't want palestine to be independent because while there is hamas getting these foreign aid in the organizations? >> foreign aid is the. it means that as long as any economy is dependent on foreign aid, if politicians dominate. in its military and politicians

dominate ordinates the source of wealth rather than internal enterprise. and so, as long as we treat the palestinians as dependents, they thrive the power in palestinian society gravitates to the terrorists and extremists and that's what's been going on. of course, hamas -- the palestinians in general, they are for you is they not accept israel's presence in the middle east. that is their stance. and hamas is more explicit and expounding this view that derrick todd or whatever makes a similar statement in the united states. the palestinian council in

washington. and abbas wrote his thesis on holocaust denials. that was his idea of an interesting subject as he was educated. these are not people who are interested in any kind of peace with israel. and that is why israel is incredible, type the logical and scientific and notch purgatorial advances, which made to increase its power in relation to the area does every year. every minute, israel becomes more powerful in relation to its neighbors. >> when you take prerogative for one quick question. and that is, you talking in your book in the israel say specifically you think the willingness to defend israel with a willingness to defend america and the west.

i want you do just elaborate a little on not. in terms not just of america, but the willingness of europe to defend its civilization. >> well, i think europe is kind of capitulating, although it may turn around at some point. but right now, because of the rise of muslim populations in europe and the anti-semitism that dominate them, europe is giving up. and i think if the united states capitulates israel, not only will war in the middle east be inevitable because it's really a combination of american power with israeli pallor that is

viable defense in the middle east, that the united states itself will be demoralized and gravely weakened. so i think it is an israel task that we all face and i think that we have to meet it. as a culture, as a civilization where we will fall into decadence and decline. >> you are on speaker risky. >> sera come you mentioned the nested at the palace and no longer competes the leadership. what i would like to ask about the europe initiative in which all the arabs combine may take

the commitment, recognize within secure boundaries as long as certain conditions are met. this file at the air country's wealth ignore -- [inaudible] for peace with all its neighbors. >> the palestinians just reject the dead. you know, the palestinians were unanimous in reject him a solution that it's the saudi's that really presented the plan, which would beg and this just another peace plan like oslo and like all the others. every time such a peace plan gets advanced, the palestinians end up locking and.

[inaudible] >> yes, yes, the israelis have constantly -- even more extreme of proposals than the saudi proposal. wal-mart essentially gave away the whole shop. omar to agree the partition of jerusalem, the removal of all the settlements. i mean, it was just an amazing capitulation that olmert made that went beyond even what the saudi youth proposed. and give it adamantly reject it. it just -- and it wasn't an especially serious effort. it stopped. it didn't have the real support even of the year of countries although they did propose that.

>> that is included but amounted to the demographic destruction of israel, and there are? >> with regard to pessimism, what relations -- [inaudible] what do you think the likelihood that the probability that can potentially inflict israel? >> as of right now, the train at the flick in the united states. i mean, you know, a major american talent is moving to israel break now. it's a better economy. it's a more attractive entrepreneurial environment. it's got a better regime. it's got supply-side economics. and recently, one of the leading oil exporters in the united states, someone named banneker

highest on elliott to israel and claims that there is enough oil shale in israel to create a saudi arabia petroleum in israel. and israel has been drastic early increasing its advantage over the last couple years. and meanwhile, what we see is the kind of disintegration of the arab countries around them. and i think the idea that now is the time for israel to extra pay settlements, disrupt his politics demoralized its people in order to install fanatical state on two sides of it is just absurd and preposterous.

if the palestinians should ever want to negotiate, they should negotiate with jordan. >> we have time for one more question. >> line going around, the fact that israel may have these vast energy resources, d.c. and impact of that on the political situation, on the chances for anything? >> i don't think that oil is fungible and natural gas is available widely around the world. and they think we, digest plain suicidal energy policy in the united states, we have endowed the middle eastern oil producers with this absurd power over us. in your column brilliantly captured the absurdity of it. and israel has many ways to

supply its energy. and that is not part of israel's power. israel's power comes from being the leading source of new technologies and inventions and insight from the world. >> like to just address one area that you type it out, the recognition issue regarding palestinians policing israelis. i don't think we see is enough attention and maybe you could comment on it. probably the biggest obstacle to achieving some kind of a negotiated peace or otherwise if the absolute refusal of successive palestinian leaders to recognize and accept the existence of the jewish state of israel. i don't think it receives enough attention of the news media or public by officials and so

forth, could you get a comment on that specific issue? that also gets into the one regarding the saudi peace plan. it's not a question of no peace, no negotiations, no recognition, but it's the continuous refusal of the baath arafat all doing the same thing and how that is blocked. and yes, that seems to be below the services that are breaking up is the number one issue. could you comment on that please? >> i think you've commented very articulately. i agree with your comment and it's been implicit in what i've been saying. >> i just want to thank george so much for these remarks and for coming here today. [applause] i think we have three minutes until 1:00. i want to clog our next panel will begin promptly. take a break and come back. [inaudible conversations]

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[inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] >> and this is the end of the conversation on u.s.-israel relations. you can go online anytime in the back up this morning's panels by going to c-span.org and checking out the c-span video library.

defense secretary leon panetta is in israel today as part of a two or three the middle east. yesterday he said israel is becoming increasingly isolated and must do more to work with its neighbors. his counterpart in israel, ehud barak says israel has a responsibility to try to ease tensions in the region and find a way to resume negotiations with palestinians. secretary panetta met today with ehud barak in tel aviv on the first leg of his middle east trip. he's also going to be meeting with palestinian leaders and will be making a stop in egypt to meet with officials there. ..

>> for the first time, americans will have access to conductivi conductivity, even if there are natural disasters and other things happening, to our satellite never. sanjiv ahuja on his company's efforts to build a $14 billion high speed wireless network, and it reports the network might interfere with consumer and

military global positioning equipment. "the communicators" tonight at eight eastern on c-span2. >> next, secretary of state hillary clinton on american leadership during a challenging time for the global economy. she was the featured speaker at the university of arkansas' clinton school of public service, and she says america's engagement abroad holds the key to future prosperity in the united states. her comments last about half an hour. >> i thought, you know, this is not something i should be doing. i am not eloquent enough. we need to pick someone like one of the kids in the clinton school who are young and energetic and probably president clinton is the greatest legacy you will lead in the city. [applause] and then i thought about it and i thought, how do you introduce

someone that you've known for 20 plus years? who is a remarkably successful mother, citizen of the united states, former first lady of our state, former first lady of the united states, a distinguished senator, and now doing a wonderful job as secretary of the state. what adjectives do you use, how do you describe someone like that? so, in my simplistic way of looking at things i have finally figured out in my ripe age of 64 that basically it's the little things and little times in life where you really find out about someone's character. so i would like to very quickly relay a story to you that happened 20 plus years ago. being in a small state, and this was a time when you are the first lady of the state, all of us went to christmas parties

together. and hillary and i were talking, and it was the normal dialogue, what's going on? christmas shopping, that sort of thing. and she said what had you been doing, and i said trying to conduct a little bit -- duckhunting. would you like to go? the first character trait that i in retrospect noted about hillary clinton, she looked at me, with great honesty she said, you are just like all the other men that say there is a doctrine and i want to go duck hunting. no one ever asked me. and i thought okay, on this, straightforward. this is a fact and this is what it is. so the monday morning, that next monday morning i picked up the phone and i called and i said, do you want to go duck hunting? she said yeah, i'll go duck hunting. she said what do i need to do? i said we're some more passionate warm clothes, i got everything else.

you know, get a hunting license. she said fine. so, i thought another trait comes out. a person with great gusto, willing to take a risk, never been hunting before, doesn't know much about the link to take a chance to do this. as i've gotten older i also understand that what she was also saying is that women can do anything men can do, and probably better. [applause] so on wednesday i got to my office, and there was a note to call hillary. and i thought here it comes. you know i can go, something has come up, that sort of thing. she said how are you doing? do we go saturday or sunday, and she said saturday. she said something us, and i thought here comes, i can go. and it was my mother called me

and wants to go shopping that day, can i go on sunday? i said no, i'm sorry, i forgot of the plan subsidy. she said okay, i'll tell mother i can go. she can go. and i thought here's a person whose word is your bond. she's said she would do it, she's going to do it and that was it. so saturday morning my father, who, next to my mother probably i idolize more than anybody in the world, idolize someone other than my mother, showed up with jon jones, at the governor's mansion. and president clinton was drinking coffee, four, 4:30 a.m., and i said you want to go? he looked at me like i'm not that dumb. i'm not going. [laughter] and hillary jumped in the car and we went. and i thought okay, we are going to go. so we get down to our little place, and it's kind of a cold, grizzley day.

and i put her in a pair of my waiters which are too big for her. she wears my mother's old hunting coat that is old and i have to duct tape the top of it to keep it together. a half, and we go out. now, hillary to my knowledge has never shot a gun, never held a gun, never looked at a gun in her life. we go over some very rudimentary instructions on how to do this. and we go out, and i thought, you know, she's doing well. but it's cold and never complains. the first duck comes in, and very uncharacteristically of my father, not my father but jon jones and i, we let her shoot first. she shoots one time, kills one deck with one shot. [laughter] [applause]

next time a duck comes out she was a probably surprised. she didn't brag. she didn't say this is easy, i'm a woman, i can do this without any trouble. she was humbled. and then chelsea, she became very realistic about the situation she found herself in because the next thing she said is, my goodness, what am i going to do? chelsea is going to tell me when she finds out what i've done. [laughter] and i thought okay, she can assess the situation correctly. and not to make it sound like that hillary is perfect in everything she did, there's one small problem we had when we came back in, and that is we're going to register our ducks. and although she bought a license she forgot to bring it.

it is in my thought process is the traits that she manifested in that week of talking about this is the same thing that of major the great person all of her life, and keep bringing her forward. arkansas is lucky to have had her, and still have her, as one of the people who have been here. we are better for it, and i think she is better for having been here also. thank you. hillary? [applause] >> thank you. oh, my goodness. dean, that story brought back so many extraordinary memories on

that cold december day, standing in the water in the waiters, and i will only add a few little details. [laughter] i didn't think it was uncharacteristic at all when they said go ahead, you take the first shot. [laughter] [applause] so, the pressure was building. it was really lucky. and it was a banded duck which i learned later was quite significant. we had a wonderful time, because next to his wonderful wife, who i adored, i thought he was one of the finest most extraordinary men i have ever met before or since. and i knew that he would watch

out for me, a little bit. with both dean and dr. jones, so we had a good time that day. then i got back to the governor's mansion, and since i've been gone, my daughter had gotten up and she asked bill, well, where i was. and bill said, well, she went duck hunting. and chelsea met me at the back door. [laughter] she said mommy, did you kill a duck quacks i said -- did you kill a duck quacks i said yes, i did. she had big tears in her eyes and she said mommy, that duck could have been some little ducks mother. [laughter] and it was shortly before christmas, but it took a day or two before she got over that. but it is a wonderful memory

that i cherish, as i do so many memories from our extraordinary times and friendships and experiences here in arkansas. and i want to thank dean and the entire kumpuris family, because your generous support of this lecture series and his school has been so welcomed. and we are deeply grateful. and i know, too, that frank he was so civic minded and public spirited would have loved sitting in the front row right next to you, kula. and he would have probably about 100 question for whoever was standing up on this stage. is also want to thank stephanie not only for welcoming us, but for everything you've done to make me, the presidential center such a success. stephanie, you done, you've been

a real solid rock throughout the years. [applause] >> i also want to thank our wonderful longtime friends, bruce lindsey and skip rutherford for their leadership, and the entire team here at the foundation, and the faculty, staff and especially the students at the clinton school. there are so many familiar faces here in the audience, and i am grateful for each and every one of you. i want to just mention a very few. i want to mention dale and betty bumpers. betty bumpers was such a great first lady for the state of arkansas in every way. [applause] and just the other day, betty called bill and said, how worried she would be that the economy and all these cuts are going to undermine immunization

efforts for our children? so she has been consistent working on taking care of our children for, long before i knew her, and ever since i have been honored to know her. and dale, i'm so pleased to see you, looking as handsome and rubbish as usual. [laughter] [applause] if you haven't seen, you know, the dale bumpers david pryor show, it is quite a spectacle. and dear david and barbara who have been our friends and our colleagues through so many years, fayetteville to little rock to washington and back. and jim guy, it's wonderful you are here. and carol tucker foreman, welcome back to arkansas, and thank you for the great battles you have waged on behalf of our food and nutrition and our children's health over all these years. and bill bowen who many of you

know is a great business leader over the years in arkansas, but i knew him because occasionally he would let me come teach at the first methodist church, bones sunday school class, where he would quietly but effectively critique everything i was saying about the lesson of the day. and there are so many others who have served in arkansas and served in washington, in bills administrations, and it is great to see it and i'm looking forward to having time with all of you over the next two days. before i begin i want to say a few serious words about events, because we had a very significant event in yemen earlier today, when we learned

of the death of anwar al-awlaki, a leader and chief propagandist of al qaeda's most active and dangerous affiliate, al qaeda in the arabian peninsula. this is the terrorist group that tried to blow up an airplane filled with innocent people on christmas day in 2009, that attempted to bring down a u.s. cargo in 2010. al-awlaki took a leading role in those plots and in spreading an ideology of hate and violence. but today, like osama bin laden and so many other terrorist leaders who have been killed or captured in years, he can no longer threaten america, our allies, are peace loving people anywhere in the world. today, we are all safer, but we recognize that the threat remains, that al qaeda does maintain the ability to plan and carry out attacks, and that our

vigilance is required. so, we will along with our partners and allies continue to ratchet up the pressure, continue pursuing a comprehensive strategic approach to counterterrorism. and worked to deny al qaeda and its affiliates safe haven anywhere in the world. it seems a long way from this absolutely glorious day here at the library, after dedicating the bridge and the bill clark wetlands, but it is what i spent a lot of my time working on, and doing everyday. and it's such a pleasure for me to be back here to have a chance to, once again, see old friends and talk about what's going on in our lives, but also to remember that we are interconnected in ways, large

and small, two people very far from where we are today. i remember the first time i flew in to the little rock airport, all those years ago. bill picked me up and drove me around little rock, then up through the arkansas river valley and the washita mountains to hot springs. and just as i had been told by arkansas' biggest booster, who i first laid eyes on as he was saying, not only that, we grow the biggest watermelons in the world, i was very taken with this beautiful state and hospitality, and welcome that i received. every time i come back i get that same feeling, and the years we spent here raising our daughter, being involved in the

public schools. chelsea saw her first grade teacher earlier today, just brings back a flood of memories. so i want to thank little rock and arkansas for everything that you have done and continue to do for me and for our family. and i'm very proud of every part of this center. the library, the foundation and the school. and this year the clinton school students are completing more than 30 international public service projects in 19 countries on all six continents. i'm very proud of what you are doing. [applause] and i also know from my extensive travels on behalf of our country how essential it is that americans keep reaching out, and that we keep opening

doors and searching for better understanding, so what you are doing is absolutely essential, and it embodies what bill and i have tried always to keep at the center of our work, at the point of public service is to produce results. as bill said earlier today at the bridge dedication, it's a very simple task. our people better off when you stop and when you started? and that's the only true for elective office but it's true in the business world. it's true in the not-for-profit world, the academic world. our children better off? will they have a better future? and are becoming together or dividing? so we have a deep responsibility with the clinton school that we care very much about. i have been looking forward to being here with you. now, one might think, well, what does any of this mean for a secretary of state.

because i'm well aware that with what's going on in our economy and the daily struggles that so many arkansans and americans are facing, it's hard to shift focus to something happening in the country of yemen are afghanistan and pakistan, or china or brazil. and there are some, and i hear their voices, who argue that the united states can no longer afford to be a global leader. that we should pull back from the world and lower our ambitions. but i am here today to tell you that nothing could be further from the truth. the fact is -- [applause] number one, we have no choice. a world is our doorstep, whether we invited or not. and number two, we cannot afford not to be engaging.

whether it's opening new markets for american businesses or breaking up terrorist plots and bringing the wars of the last decade to a successful close, our work around the world holds the key to our prosperity and security right here at home. there are many examples of this, and some of them are controversial. but take, for example, the pending free trade agreements with south korea. it is expected to create 70,000 american jobs if congress approves it, including thousands right here in arkansas because terrorists on most agricultural exports are phased out. that will make a real difference in people's lives. from the first days of the obama administration, we have worked to renew america's global leadership. because we wanted to deliver more for the american people.

and for the last decade our foreign policy has been focused on places where we face a greater dangers -- greatest dangers. responding to threats will always be central to our foreign policy, but it cannot be our foreign policy. if all we do is focus on the threats and dangers, we will miss the opportunities. and in the decade ahead we need to focus just as intensely on the places where we have the greatest opportunities as on those places where we have faced the greatest danger. now, what that means for me every day is looking for ways to support the so-called arab awakening, the transition sweeping across the middle east and north africa. they are some of the most consequential historic changes of the last many decades, certainly since the fall of the soviet union. it also means renewing america's

preeminent role in the asia-pacific. that is for our future the most consequential region of the world. it means elevating the role of economics and foreign policy, the most vibrant source of our power and a vital part of driving our economic recovery right here at home. it means working to empower women and girls around the world. a piece of unfinished business of humanity. it means changing the way we do foreign policy, so we are using 21st century tools and harnessing what i call smart power to produce results. so we are working on all of these fronts, and more. but i deeply understand why so many americans today are worried about what lies ahead for them, for the families and for our country.

some even wonder looking at the landscape of problems here at home and abroad whether america is still up to the job. well, we have lived through times of anxiety before. i remember when i was growing up, that it was we were falling behind the soviets into theology and ambition. i remember my fifth grade teacher saying that we needed to all studied mathematics so that the russians wouldn't get ahead of us, and president eisenhower himself expected us to learn math. that made a big impression on me. i tried and i hope the president would give me some credit for effort. [laughter] when i started practicing law here in little rock, our country faced stagflation and oil shock. when i moved with bill and chelsea to washington, as he was

in nigeria president, it was outsourcing, the apparent decline of american competitiveness and a budget deficit which at the time it seemed unbelievable about what, $350 billion. but each time we rose to whatever challenge faced us. american entrepreneurs and innovators proved the naysayers wrong. we outworked, we out build, and we simply outcompeted every rival. when it mattered most, we put the common good first ahead of ideology, party or personal interest. so our people and generations of american leaders build a resilient economy, a global architecture of institutions and norms that protected not just our interests, but the interests of all people who wanted a better life in a rule-based

international order. that was exceptional leadership from an exceptional country. i remember when bill and i went to east asia when he was governor. it was the first trade mission ever to places that seemed very far away from arkansas, like japan and hong kong. the people we met in asia didn't see an america in trouble. they saw a beacon of opportunity and liberty, a superpower underwriting peace and security in the region, and a dynamic market driving global growth. and lucky for us that also saw lots of arkansas soybeans they wanted to buy. now, that view of america was right then and it's right now. in the last decade we've lived through terrorist attacks, too long wars, and a global financial crisis. through it all, america remains

an exceptional country. and the sources of america's greatness are more durable than perhaps many realize. yes, our military is by far the strongest. our economy is by far the largest in the world. but our workers are still the most productive, and our universities are the gold standard. our core values of equality, tolerance, opportunity, are an inspiration to people everywhere. so yes, we do have real challenges, but there's no doubt we have the capacity to meet him. just look here in arkansas. arkansas farmers are finding new markets for poultry, cotton and rice. and those exports are supporting tens of thousands of jobs on and off the farm. arkansas manufacturers are selling aerospace components and

electronics, chemicals and plastics to new customers all over the world. in 2000, arkansas exported only $20 million worth of goods to china. last year it topped $336 million. [applause] >> in the end of this summer governor beebe delivered the keynote address at the first ever arkansas china business and economic summit at the university of central arkansas. students across arkansas are working to help solve problems. like in bangladesh where they are supporting a farmer to farmer program that uses new technologies and new relationships to boost food production. and the state department is doing everything we can to promote american business abroad. foreign investment in arkansas

already directly supports more than 33,000 jobs, but i think that's just the beginning of what is possible. so we are making it a priority for our ambassadors to help american businesses to work with governors and mayors like governor bp and mayors to have job creating investment back here doing what we do best, making things and exporting those. we are also working to bring down other countries internal trade barriers that unite our companies the chance to compete fairly, including abusive regulatory regimes, currency manipulation and lax labor and environmental standards. are standing up for the intellectual property rights of america's integrated. too often under attack, nearly everywhere in the world. and to build up to mars trading partners and create future opportunities for exporters, we're changing the way we do

international development, and focusing on investment rather than a the. so everything i know tells me that we have the talent and ingenuity and work ethic to come to these current difficulties. but nothing is preordained. no outcome is inevitable. leading the world in the years ahead will take the same hard work, clear eyed choices and commitment, the shared sacrifice and service that built our country's greatness in the first place. and ultimately that responsibility doesn't rest on the shoulders of a president or secretary of state, or a governor or senator or a mayor. it's really an obligation that belongs to all of americans. we have to step up. we have to improve our own efforts. we have defined both the common ground and the common good that has united us in the past.

know, late last year i helped townhall meeting in kosovo. this is a place where america made all the difference to the future on those people who survived a brutal effort and ethnic cleansing. if you ever go, there's a very large statue of bill as a way of thanking him for his leadership. and next to the statue there is a little shopping area, and somebody start something called the hill restore, where they sell very nice clothing, but alas, no pantsuits. [laughter] so i went into the store, and i said my goodness, i'm so surprised. why on earth do you need a hill restore? and the woman whose story was, very, you know, proudly told me they didn't want bill to get lonely.

[laughter] so later at the townhall meeting, a man stood up and thanked me for everything america had done for his country. and like in so many places in the world, he and his neighbors continue to see american leadership as the linchpin to their own future success. and he asked me, will you help us so we can finally see the biggest and the brightest and beautiful parts of democracy and a new economy? in the great american nation assist us in our struggle to reform is to restore our struggle of all. just as in times past, that is what america still means to countless people around the world. it's opportunity, responsibility, community, and today it is our chance, and our great privilege to live up to that well-earned reputation of

the past. to make the hard choices here at home and abroad that keep the promise of america alive and well. yes, we have to keep putting people first, and keep building those bridges. and don't stop thinking about tomorrow. thank you all. [applause] >> and taking a look at israel now. it must find way to resume negotiations with the palestinians and has a responsibility to try to ease tensions with its neighbors in the region. that's what the israeli defense minister had to say today. he made his comments do next is defense secretary leon panetta is making his first visit to the middle east in his new job. secretary panetta met today with i hope barack, and you'll be traveling to the west bank for a meeting with palestinian president abbas. there were no public remarks by the leaders after their meeting.

secretary panetta is scheduled to meet with egyptian leaders. and then we head to brussels for a meeting of nato defense ministers to talk about the afghanistan war and the military mission in libya. is scheduled to meet with israeli prime minister benjamin netanyahu. >> both the house and senate gavel in this afternoon at 2:00 eastern time.

>> saturday night president obama addressed the annual dinner of the human rights campaign. he talks about the progress made during his administration in achieving civil rights for gay americans and the work that remains. his speech came less than two weeks after the military and its ban on openly gay servicemembers. this is about 20 minutes. [cheers and applause] >> thank you. hello, hrc. [cheers and applause] thank you so much. thank you. thank you very much. [cheers and applause] >> thank you. thank you so much.

thank you, everybody. thank you. please, please, have a seat. thank you so much. it is great to be back. [applause] i see a lot of friends in the house. i appreciate the chance to join you tonight. i also took a trip out to california last week, where i held some productive bilateral talks with your leader, lady gaga. [laughter] she was wearing 16-inch heels. [laughter] she was eight feet tall. [laughter] it was a little intimidating. now, i don't want to give a long speech. cyndi lauper is in the house. i can't compete with that. [applause] but i wanted to commit tonight

first of all to personally thank joe for his outstanding years of leadership at hrc. [applause] what he has accomplished at the helm of this organization has been remarkable, and i want to thank all of you for the support that you've shown this organization and for your commitment to a simple idea, every single american, gay, straight, lesbian, bisexual, transgender, every single american deserves to be treated equally in the eyes of the law and in the eyes of our society. it's a pretty simple proposition. [applause] now, i don't have to tell you that we have a ways to go in that struggle.

i don't have to tell you how many are still denied their basic rights, americans who are still made to feel like second class citizens, who have to live a lie to keep their jobs, or who are afraid to walk the street, or down the hall at school. many of you have devoted your lives to the cause of equality. so, you know, what we have to do, we've got more work ahead of us. but we can also be proud of the progress we've made these past two and a half years. inc. about it. [applause] -- think about it. two years ago i stood at this podium industry and before many of you and i made a pledge. i said i would never counsel patients, that was a right to tell you to be patient any more than it was right for others to tell african-americans to be patient in the fight for equal

rights a half-century ago. [applause] but what i also said, that while it might take time, more time than anyone would like, we are going to make progress. we are going to succeed. we are going to build a more perfect union. and so let's see what happened. i met with judy shepard. i promised her we would pass the hate crimes bill named for her son, matthew. and with the help of my dear friend ted kennedy we got it done. because it should never be dangerous -- [applause] you should never have to look over your shoulder to be gay in the united states of america. that's what we got it done. [applause]

i met with janice langbehn, who was barred from the bedside of the woman she loved as she lay dying. and i told her we're going to put a stop to this discrimination. and you know what? we got it done. i issued an order so that any hospital in america that accepts medicare or medicaid, and that means just about every hospital, has to treat gay partners just as they do straight partners. because nobody should have to produce a legal contract to hold the hand of the person that they love. we got that done. [applause] i said that we would live that hiv travel ban, we got that done. [applause] we put in place of the first comprehensive national strategy

to fight hiv/aids. [applause] many questioned whether we'd succeed in repeating don't ask, don't tell. and yes, it took two years to get the repeal through congress. [applause] we had to hold a coalition together. we're to keep up the pressure. we took some flak along the way. [applause] but with the help of hrc, we got it done. and don't ask, don't tell is history. [applause] and all over the world, there are men and women serving this country just as they always have, with honor and courage and discipline and valor. we got it done. [applause] we got that done. [cheers and applause] all around the world, you've got

gays and lesbians who are serving, and the only difference is now they can put up a family photo. [laughter] no one has to live a lie to serve the country they love. [applause] i vow to keep up the fight against the so-called defense of marriage act. there's a bill to repeal this discriminative law in congress, and i want to see that past. but until we reach that day, my administration is no longer defending doma in the courts. i believe the long runs counter to the constitution, and it's time for it to what end once and for all. it should join don't ask, don't tell in the history books. [applause] so yes, we have more work to do.

and after so many years, even decades, of inaction you've got every right to push against the slow pace of change. but make momus day, i want people to feel encouraged here. we are making change. we are making real and lasting change. we can be proud of the progress we've already made. and i'm going to continue to fight alongside you. and i don't, i don't just mean in your role, by the way, as advocates for equality. you're also moms and dads who care about the schools your children go to. [applause] you're also students figure out how to pay for college. you're also folks are worried about the economy and whether or not your partner or husband or wife will be able to find a job. and your americans who want this country to succeed and prosper, and who are tired of the gridlock and the vicious partisanship, and are sick of

the washington games. those are your fights, too, hrc. [applause] so i'm going to need your help. i need your help to fight for equality, to pass a repeal of doma, to pass an inclusive employment nondiscrimination bill so that being gay is never again a fireball of things in america. [applause] and i don't have to tell you, there are those who don't want to just and in a way but want to turn the clock back. you want to return to the days when gay people couldn't serve the country openly, reject the progress that we've made, who, as we speak, are looking to enshrine discrimination into state laws and constitution, efforts that we've got to work hard to oppose, because that's not what america should be about. we are not about restricting rights and restricting

opportunity. what about opening up rights and opening up opportunity. [applause] and treating each other generously and with love and respect. [applause] and together, we also have to keep sending a message to every young person in this country who might feel alone or afraid because they are gay or transgender, who may be getting picked on or pushed around because they are different. we've got to make sure they know that there are adults they can talk to, that they are never alone, that there is a whole world waiting for them filled with possibility. that's why we held a summit at the white house on bullying. that's why we're going to continue to focus on this issue. it isn't just kids being kids. it's wrong. it's destructive, it's never acceptable. and i want all those kids to know that the president and the first lady is standing right by them every inch of the way. [applause] i want them to know that we love them and care about them, and they are not by themselves.

that's what i want them to know. [applause] now, i also need your help in the broader fight to get this economy back on track. you may have heard, i introduced a bill called the american jobs act. [applause] it's been almost three weeks since i sent it up to congress. that's three weeks longer than it should've taken to pass this commonsense bill. [applause] this is a bill filled with ideas that both parties have supported. tax breaks for companies that hire veterans, road projects, school renovations, putting the construction crews back to work

rebuilding america, tax cuts for middle-class families so they can make ends meet and spend a little more at local stores and restaurants that needs a business. now, you may of heard me say this a few times before, i'll say it again. pass the bill. [applause] in the gridlock. enough delay. enough politics. pass this bill. but this country back to work. [applause] hrc, you know how congress works. i'm counting on you do have my back. go out there and get them to pass this bill. [applause] let's get america back to work. now ultimately these debates we are having are about more than just politics. they are more about, they're about more than the polls and pundits, and who's up and who's down. this is a contest of values. that's what's at stake here. this is economy will debate

about who we are as a nation. i don't believe, we don't believe, in a small america, where we let our roads crumble, we let our schools fall apart, where we stand by while teachers are laid off and science labs are shut down, and kids are dropping out. we believe in a big america, and america that invest in the future, that invest in schools and highways and research and technology, the things that have helped make our economy the in the of the world. we don't believe in a small america where we meet our fiscal responsibilities by abdicating every other responsibility we have, and where we just did he up the government as tax breaks for those who need them the least, where we abandoned the commitment we've made to seniors through medicare and social security, and we say to somebody were looking for work, our student who needs a college loan, or a middle-class family with a child who's disabled,

that you're on your own. that's not who we are. we believe in a big america, an america where everybody has got a fair shot, and everyone pays their fair share. an america where we value success and the idea that anyone can make it in this country. also and america that does come in which everyone does their part, including the wealthiest americans, including the biggest corporations, to deal with the deficits that threaten our future. [applause] we don't believe in a small america. we don't believe in the kind of smallness that says it's okay for a stage full of political leaders, one of them could end up being the president of the united states, being silent when an american soldier is booed. [applause] we don't believe in that. we don't believe in standing silent when that happens. [applause] we don't believe in them of being silent since.

[applause] you want to be commander in chief? you can start by standing up for the men and women who wear the uniform of the united states, even when it's not politically convenient. [applause] we don't believe in a small america. we believe in a big america, a tolerant america, a just america, and equal america, that values the service of every patriot. [applause] we believe in an america where we are all in it together, and we see the good in one another, and we live up to a creed that is as old as our founding, e pluribus unum. out of many, one. and that includes everybody.

that's what we believe. that's what we're going to be fighting for. [applause] i am confident that's what the american people believe in. [applause] i'm confident because of the changes we've achieved these past two and a half years, the progress that some folks said was impossible. and i'm hopeful, i am hopeful -- >> fired up spent i am fired up, too. [laughter] i am hopeful, i am hopeful,. [applause] i am still hopeful, because of a deeper shift that we are seeing, a transformation and not only into our laws, but woven into the fabric of our society. it's progress led not by washington but by ordinary citizens, who are propelled not just by politics but by love and friendship and a sense of mutual regard. [applause] it's playing out in legislatures like new york, and courtrooms and in the ballot box.

but it's also happening around water coolers and at the thanksgiving table, and on facebook and twitter, and at pta meetings potluck dinners, is church social and vfw halls. it happens when a father realizes he doesn't just love his daughter, but also her wife. [applause] it happens when a soldier tells his unit that he's gay, and they tell him they knew all along and they didn't care, because he was the toughest guy in the unit the. [applause] it happens when a video sparks a movement to let every single young person know they are not alone, and things will get better. it happens when people look past their ultimately minor differences to see themselves in the hopes and struggles of their fellow human beings. that's where change is happening in. [applause] and that's not just the story of the gay-rights movement. that's the story of america. [applause] the slow, inexorable march toward a more perfect union. [applause]

you are contributing to that story, and i'm confident we can continue to write another chapter together. thank you very much, everybody. god bless you. [applause] [cheers and applause] ♪ ♪ ♪ ♪ ♪ ♪

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>> the nation's highest court begins its new term today. the first order of business for the supreme court is disposing of appeals in more than 1000 cases that piled up over the summer. the justices will hear arguments in the case that centers on california's plan to cut medicaid payments to doctors, hospitals and other medical providers to close the state's budget gap. the nine justices who will serve without seeking election will also have to decide whether to insert themselves into the center of the presidential campaign next year. >> on our companion network c-span, we are taking a live look at ken burns documentary filmmaker. he's giving a talk from the national press club about his latest documentary on prohibition. will also have him on tomorrow morning on "washington journal." he will be our guest tomorrow

morning and you can tune in to "washington journal" starting line at 7 a.m. every day of the week here on a companion network c-span. >> for the first time americans will have access to connectivity and even if there are natural disasters and other things happening through our satellite network. >> the head of life square, on his campus efforts to build a $14 billion a speed wireless network amid reports that the network might interfere with consumer and military global positioning equipment. "the communicators" tonight at eight eastern on c-span2. >> before the presidential election of 1916, charles evans hughes which a lawyer and professor, a two-term governor of new york. and although he lost his bid for the presidency his impact on political history remained serving as the postwar secretary of state and ultimately chief

justice of the u.s. he is one of the 14 men featured in c-span's new weekly series the contenders, live in washington, d.c. friday at 8 p.m. eastern. for a preview about him, watching number of videos about him at our special website for the series, c-span.org/thecontenders. >> with congress back in session this week, the house will consider a spending bill that would keep the federal government open for another six weeks through mid-november and the senate is proposing a bill dealing with china's currency. watch live gavel to gavel coverage of the house on c-span and the senate on c-span2. use our resource on congress to get more information about your elected officials with c-span congressional chronicle including video of every house and senate session, voting record, many hearings and more. it's washington your way. the c-span networks, created by cable, or fight as a public service. >> taking a look at the capitol

this afternoon. in the senate is about to gavel in for the week. senators will begin the day with about an hour of general speeches. at 3:30 p.m. to start discussion on whether to move forward on a bill setting sanctions on china if it manipulates its currency. at 4:30 p.m. judicial nominations with votes plan for of30 p.m. eastern.esiding live coverage now with the senate here on c-span2. will lead the senate in prayer. the chaplain: let us pray. holy father, we come into your presence today to look at ourselves as we are and to seek your power to become what you would have us be. search our hearts and empower us

to do your will. encourage our lawmakers to fulfill your purposes for the glory of your name. move, mightily in their hearts and align them with your kingdom perspective. as blessings flow when your will is done, let us not take credit for what your sovereign hand accomplishes on our behalf. today and through the days of this week, call us to you that we may be transformed from mere followers to true servants of your kingdom.

we pray in your everlasting name. amen. the presiding officer: please join me in reciting the pledge of allegiance to the flag. i pledge allegiance to the flag of the united states of america and to the republic for which it stands, one nation under god, indivisible, with liberty and justice for all. the presiding officer: the clerk will read a communication to the senate. the clerk: washington, d.c, october 3, 2011. to the senate: under the provisions of rule 1, paragraph 3, of the standing rules of the senate, i hereby appoint the honorable richard blumenthal, a senator from the state of connecticut, to perform the duties of the chair. signed: daniel k. inouye, president pro tempore. the presiding officer: the majority leader. mr. reid: following any leader

remarks, the senate will be in a period of morning business until 3:30 today. at 3:30, the senate will begin consideration of the motion to proceed to s. 1619, which is the currency exchange rate oversight reform act. at 4:30, the senate will be in executive session to consider several judicial nominations. at 5:30 there will be two roll call votes. the first vote is on confirmation of menry flaid, south carolina, to be united states circuit judge for the fourth circuit. the other vote will be on a motion to invoke cloture on the motion to proceed to the currency exchange matter. mr. president, today the senate begins another very busy work period. i'm confident this work period will be productive. tonight the senate will vote, begin debate on legislation to curb china's unfair currency manipulation. i expect strong bipartisan support to move this legislation forward. there have been conversations

between the bipartisan supporters of this legislation, the house of representatives, and the administration. my colleagues, both democrats and republicans, agree that china's deliberate actions to devalue its currency give the goods an unfair competitive advantage in the marketplace. their goods do not deserve that. that's not fair. it hurts our economy. it costs americans jobs. the last decade alone, we've lost more than a million american jobs to china because of this trade deficit. fueled by currency manipulation. that massive trade deficit is one of the reasons for unsustainable unemployment rate. this legislation that we're going to move to will even the playing field and help american goods compete in a global market and help keep american jobs here at home. democrats believe there's no problem facing this nation that deserves our attention more than the jobs crisis. this bill is part of the effort to get our economy become on track and put americans back to work. china stops the practice of

artificially tipping the scales in its favor. it would create 1.6 million american jobs fairly quickly. i hope this legislation will motivate china to stop devaluing the yuan on its own. i also know it will send a strong pledge to the chinese that americans will no longer ignore their blatant, unfair trade practices. we expect to wrap up work on the china currency quickly this week. we have a lot to get done this month, so the senate must move fast. one out of every nine federal judgeships remains vacant, which puts at riive the right of every american to a fair and speedy hearing. while i a been frustrated at the senate's slow pace in confirming judicial nominees, i am pleased that we have been able to reach an agreement to confirm 10 judges this week and next. these nominations are noncontroversial, have the unanimous support of the judiciary committee. five of the six judges we'll

confirm today come from states with republican senators and all five of them receive the support of the republican senators. this month the senate will also take up three appropriations bills. last month we passed a continuing resolution to fund the government through november 18. now we must finish our worg on annual appropriations bills. we'll also take up three trade bills this work period. last month the senate passed trade adjustment assistance legislation, which helps united states workers who lose their jobs because of international trade to learn new skills and reenter a changing workforce. a global economy tweeness global competition and a flevment, well-trained workforce is the only thing that will allow us to keep pace with our rivals. that's why democrats insists on passing trade adjustment assistance before we take up the three trade bills we'll soon consider. panama, korea, and colombia. the republicans have said these trade agreements are important to them, yet for months they've been prevented from moving

forward by stalling trade adjustment assistance. i hope the house will not delay any longer on taking up trade adjustment assistance. i'm told that they won't. the senate will also take up president obama's american jobs act. we'll do this month. members should rally behind the commonsense, bipartisan approach of this legislation. it would cut taxes for working families, small businesses, and it would spur job creation and put americans to work restoring this nation's decaying roads, bridges, dams, and schools. i'm happy to work with my colleagues on both sides of the aisle to improve this bill. but i hope the obstructionism republicans employed the last nine months won't continue. this year democrats produced jobs bill after jobs bill. meanwhile, the republicans will put their own agenda ahead of the nation's jobs agenda. this month they'll have yet another month to prove this. i urge my republican friends to

remember that action speak much louder than words. i hope we'll tak we'll they'll p democrats put this nation back to wocialg. work. will the chair announce morning business? the presiding officer: under the previous order, the leadership time is reserved. under the previous order, the senate will be in a period of morning business until 3:30 p.m. with senators permitted to speak therein up to 10 minutes each. the clerk will call the roll. quorum call:

quorum call:

mr. mccain: mr. president, i

ask unanimous consent further proceedings under the quorum call be suspended. the presiding officer: without objection. mr. mccain: mr. president, i paid attention to the remarks made by the majority leader concerning the upcoming schedule for the next week or two or three weeks and the fact that we are now considering the motion to proceed to a bill pertaining to chinese currency. i understand very well that it's the prerogative of the majority leader to set the legislative agenda of the senate, and i respect that prerogative. but toeuf -- but i have to express some amazement that the issue of the chinese currency is taking precedent over the myriad of other issues we should be acting on. there was a piece in today's, one of the articles in today's

"cq today" says that last year it looked like the time was right for congress to confront china. a similar bill was passed by the house. this year they expected bulwark against a measure with a g.o.p.-controlled house where top republicans are echoing concerns from the business community in enacting a measure which would spark a trade war. republican leaders uniformly voted against the china measure last year while democrats voted for the bill. schumer argues a strong senate vote this time around would make it hard for the house to block it, but an aide to house majority leader eric cantor of virginia says there are no plans to vote on china currency legislation. so with over 9% unemployment,

with a debt and a deficit continuing to run out of control, with the 12 or 13 appropriations bills not acted on, with the defense authorization bill perhaps for the first time in 41 years not being taken up by the united states senate, now in its wisdom, under the leadership of the majority leader, we will be taking up the china currency bill. china currency is an important issue. i think that it's worthy of debate and discussion in happier times. but if one has any curiosity about the low esteem with which congress is being held, then no better example of that is the way that we have addressed the issues including not passing a budget, which is against our own

law, for the second consecutive year; including going through a continuing resolution rather than authorizing and appropriating the functions of government as is the responsibilities of the congress of the united states. and here we are, as i said, unemployment 9.1% with an estimated 14 million americans out of work. 228,098 homes in foreclosure nationwide, a jump of 7% from july to august of this year. in my home state of arizona, one in every 248 homes is in foreclosure, the third-worst in the nation. the majority leader's home state, number-one in the nation, one in every 118 homes is in foreclosure. 22.5% of the homes in america are under water, meaning their

mortgage is more than their home is worth. in arizona that number is 49%. in nevada, 60% of the homes are under water. $1.3 trillion deficit. we have a debt of nearly $14.8 trillion that represents $43,375 for every man, woman and child in america. so, we will take up before the senate the china currency bill. the china currency bill. and then someone in this body may wonder why the approval rating of congress is, the one i saw was 12%, one 13%. i think proceeding in this fashion, we may be able, with some success, to drive that down into single digits.

i hold town hall meetings, as most of my colleagues in congress do as well, and people are very angry at congress. we understandably look at the president's approval ratings, and i would urge my colleagues to look at those approval ratings of congress. as i've often said, and probably worn out the line, we now have such high rates of disapproval that we are down to blood relatives and paid staffers. so here we are also the fiscal year having begun on the 1st of october, for the first time in 41 years apparently we're not going to schedule or pass a defense authorization bill. the defense authorization bill is, in my view, and it is a biased view because of my membership on that committee for

so many years, but not totally biased, authorizes pay and personnel. it budgets training and equipping the afghan security forces. it fully supports the request of $1.7 -- $1.75 billion in coalition support. fully supports the budget request to support the activities of the office of security, cooperation in iraq. increases the funding for cybersecurity initiatives. provides a provision that would require d.o.d. to require and incorporate capabilities for discovering previously unknown cyberattacks on its networks. it covers missile defense, strategic capabilities, nuclear safety, nuclear proliferation. it supports crucial defense modernization programs. friends, there is no more

compelling requirement than that of the defense of this nation. the armed services committee, of which i am a proud member and work in a bipartisan fashion with the senator, the distinguished chairman, senator levin from michigan, we put in long hours and we scrutinize and we study and we have hearings, and we try to do the people's work. the vital and important mission of defending this nation. and so now the fiscal year has expired. we're operating on a -- quote -- "continuing resolution." and what is the issue before the body? , the august body, the world's greatest deliberating body, according to some. the china currency bill. the china currency bill, which we expect to take up for the

entire week, which according to any reliable report, will never see the light of day in the other body. now there have been controversies surrounding the defense authorization bill not only this year, but in previous years. i strenuously objected last year to the repeal of the don't ask, don't tell being included in defense authorization until we had a chance to assess the effect on morale, readiness, recruitment and battle effectiveness, which was the view of the majority of the chiefs of the services. the year before we took up hate crimes bill and put it on the defense authorization bill. my objection was that it had nothing to do with our nation's defense. but there are many issues that need to be addressed.

many issues concerning detainee treatment, concerning other issues which are controversial. but the job of the senate is to debate and to amend and to pass legislation. what is more important? what is more important than the security of this nation and the care of the men and women who are serving in the military? i note the presence of the majority leader on the floor. i have urged him privately on several occasions to bring up the defense authorization bill. he responded to me, and i'm sure he may respond that there are issues concerning detainees, about trials in the united states, about guantanamo bay. and my response to the majority leader has been those are issues that the senate should debate. those are the issues that the senate should make its judgment on. and i assured him and i assure

him again that i will consider the objections and reservations that the president and the executive branch has to some provisions in the bill particularly concerning detainee treatment. and give great deference to the view of the executive branch and the president of the united states, but that doesn't mean we shouldn't take up the bill. it doesn't mean we shouldn't take up the defense authorization bill. and the appropriations bills following it. first we authorize. then we are supposed to appropriate. the senator from nevada, the distinguished majority leader, and i came to the senate together more years ago than we would like to remind some of our colleagues. 20-something years ago when we came to this body we regularly took up authorization and

appropriations bill. we took them up one by one, and we had debate and we had amendments. and, by the way, the practice of filling up the tree, which is, which both sides of the aisle in this body are guilty of, was not heard of in those days. so i know that the, i know that the majority leader's time is valuable. i would just remind my friends that the legislative calendar which is here are waiting consideration. here are just a few of the authorizing bills waiting consideration. the senate armed services committee has approved the national defense authorization act for fiscal year 2012. the committee on homeland security and governmental affairs approved the department of homeland security authorization act. the senate finance committee has approved the airport and airway trust fund reauthorization act. the senate environment and public works committee has approved the surface

transportation extension act. and today is october 3, the third day of fiscal year 2012, and guess how many of the 12 annual appropriations bills have passed this body? the answer is one. why not bring these -- it's not as if the bills are not ready for floor consideration. they have been khraoerpbd placed on the legislative -- cleared and placed on the legislative calendar, so why not bring them to the floor for debate and amendments. the agricultural appropriations bill, commerce-state-justice appropriations bill. all of these, by the way, should have been preceded by authorizing legislation. what has happened around here? unfortunately, for the majority of the members of the united states senate, is that by virtue of the fact that we do not take

up authorization bills for the functions of various branches of government, it renders the appropriations process transcendent in the deliberations and inclusions this body has made. thereby, making members of the appropriations committee have an unwarranted, in my view, but certainly far more impactful role in the united states senate than members of the authorizing committees. i intend to continue to work to change that process, to require appropriations bills to reflect the authorizing committees' legislation, that the appropriations committee not be permitted to authorize, which is not their role, which over the

years have become more and more prevalent and routine. my office resides in the russell senate office building. named after a distinguished chairman of the defense authorization committee, defense -- the national defense -- the committee on which i -- the armed services committee, the committee on which i reside. he was the distinguished chairman of the armed services committee, a distinguished member of this body. i'm sure that if he were on this floor today, that former distinguished chairman of the armed services committee would be making the same remarks i am today, that responsibilities, not the privileges, but the responsibilities of those of us on the authorizing committees, including the armed services committee this year, have been abrogated and overcome by a process which is clearly

gridlocked. i will reserve the right -- mr. president, i recognize the presence of the majority leader on the floor, so i yield to the majority leader and then return to my remarks following his. the presiding officer: the majority leader. mr. reid: mr. president. the speech given to my friend, the senior senator from arizona, is a speech that i could give because he's absolutely right. we have so much we have to do. but we have had a problem because of the republicans in the senate. we have said basically -- we have spent basically 100% of our time these last nine months on two issues that should have taken a matter of a few hours. it's taken months and months. the continuing resolutions -- excuse me, mr. president -- we voted on a continuing resolution for one week, two weeks, went on and on for months trying to fund

government two, three days ago, the first of october. that took months to get that done. and then as soon as we finished that, that little exercise was only preparation for the long-standing time that we had to spend on raising the debt ceiling. some of it we had done with ease on scores of other times. just during the eight years of president reagan, for example, we raised the debt ceiling for him 18 times. we spent months, months on this continuing resolution and on the debt ceiling, and it prevented us from doing our work. so the words that my friend from arizona has given about all the work that needs to be done doesn't include all the work that we have to do. i don't think there could be a more important piece of legislation right now with the jobs being the way they are than

china currency. everyone knows how they have manipulated their currency, which has been very, very difficult for our country. we have lost in the last 10 years because of that two million jobs, jobs that should be our jobs if the currency was fair, but it's not, it's manipulated. this is a jobs bill we're on today. it's a bipartisan piece of legislation that has been supported by large numbers of democrats and republicans. we have put this off for a long time. now is the time to do that. we must send a message to the chinese that we are serious. mr. president, we have for 50 years every year passed a defense authorization bill. we need to do it this year. it's extremely important, for a number of reasons.

one is these programs are important, just taking care of our soldiers, sailors, marines, airmen. it sets funding levels for weapons and ammunition programs and funds forces around the world. it contains authorizations, new authorizations for programs that are extremely important to this country, including counternarcotics efforts that are critical to our efforts around the world. this defense authorization bill is also a bill that has some of the best oversight of any of the work that we do. the armed service committee does really good work, and looking at the oversight of the military, this is a civilian oversight responsibility we have, and we need to complete that. so i agree with my friend from arizona it is vital that we get to this bill and pass it.

but i also say, mr. president, that in its present form, i'm going to have some difficulty bringing this bill to the floor. it contains provisions relating to the detention of terrorism suspects that in the words of national security advisor john brennan would be, and i quote, disastrous, would tie the hands of counterterrorism professionals by eliminating tools and authorities that have been absolutely essential to their success. to show you how extremely important it is that we do something about these provisions in this bill that are just wrong, both the judiciary committee in the senate and the intelligence committee in the senate have asked for hearings on this provision in this bill. i would also just going back to my original subject on china trade, mr. president, the house of representatives is going to

pass china trade. everybody knows that now. a couple of months ago, that may not have been the case, but they will pass that as soon as we do. i would hope that my friend from arizona, who we all have such admiration and respect, we know how much he cares about our country and particularly about the armed forces of our country, i wish he would consider doing what we did last year. we had another problem with the defense authorization bill, not from our perspective like it is today, but it was from his perspective because he felt very strongly that the don't ask, don't tell should not be in the defense authorization bill. i disagreed with him vehemently. but we agreed to take that out of the bill and have a separate vote on don't ask, don't tell. it worked out fine. i moved that during the lame duck session. people criticized me for

bringing it up, but it's something that i felt i had to do because that was an agreement with people -- that i had with people who cared a great deal about that and i received lots of criticism because i took it out of the defense bill or had it taken out of the defense authorization bill. so i would say to my friend, the senator from arizona -- and he is my friend -- that we take this provision out of this bill and bring it up, have an up-or-down vote on it, however they want to handle that, let the judiciary committee, the intelligence committee do their work on this provision. it is really not a good provision since it was put in that bill. we have had some significant changes around the world, and it would be such a detriment to what we need to do to get these bad guys with this provision in the bill. so i would hope that my friend would treat this provision as i treated the don't ask, don't tell. he complained about that. i didn't think he was right but i thought it was so important that we move to the defense

authorization bill and it was taken out. we need to do that with this. it will be better for our country, it would be better for the senate, and it would be better for the bipartisan work that we have to do around here. and i don't in any way criticize my friend from bringing this up. i have talked to him privately. i have talked to senator levin, the chairman of that committee, on a number of occasions, and i have expressed in the recent weeks that we have a problem with this provision. and, in fact, i didn't know the senator from arizona was going to be here today. i have a letter in my office that i'm looking over that i was going to have hand delivered to senator mccain and senator levin today, and i will continue do that, but the whole subject of my letter was to explain to them the problem with this. mr. mccain: mr. president.

the presiding officer: the senator from arizona. mr. mccain: mr. president, i thank the majority leader for his comments. first of all, on the issue of china currency, i believe it's correct that the administration itself objects to this legislation much less the other body taking it up, and i -- and i say with great respect to the majority leader and his knowledge of the economy and the jobs that have been lost to china, china currency may be part of the problem, but it certainly isn't a result of the two million jobs lost. certainly the majority of the reason for that are for other reasons which have been well ventilated. i say the majority leader -- to the majority leader, i will be glad and will continue to sit down with the administration and with the majority leader and with senator levin on this issue

of detainee treatment. the fact is that the president of the united states began his tenure as president of the united states with a commitment to close guantanamo bay. i want to close guantanamo bay, and i have made that very clear, but guantanamo bay cannot, for all practical purposes, be closed at this time. that brings in other issues such as treatment of people who are apprehended in attempting to inflict damage and mayhem on people in the united states. so i think it is something that we can work out. i would hope that we would be able to debate and amend, which is the usual way we address issues in this body rather than refusing to bring legislation to the floor because there is a particular objection to it. last year, as the majority leader pointed out, i was

opposed to the repeal of don't ask, don't tell on the grounds that the same view i had was that of the service chiefs that we needed to assess the impact of repeal on retention readiness and battle effectiveness. but that should not, in my view, be the reason for us not to take up the legislation this year, and i'm sure that the majority leader is aware, this would be the first time in 41 years we are in two wars. we have to address the issues that only the authorizing committee is capable and chartered to do. so i hope that the majority leader would observe that we could take up this legislation, debate it, amend. the president always has veto authority if he wishes to veto it. we also have the other body on the other side of the capitol that would play a role in this, and we would do through the --

go through the normal process of passing the defense authorization bill which has been a tradition for some 41 years here in the united states senate, and i do appreciate the majority leader taking the time from his busy schedule to come to the floor and express his reasoning behind the schedule that he has set for the united states senate, which is well within his authority. would you like to say anything more? i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call: mr. mccain: i ask unanimous consent further proceedings under the quorum call be suspended. the presiding officer: without

objection. mr. mccain: as i was saying, mr. president, we have only one of the 12 authorization bills that have been considered by the senate to date, which was the military construction, veterans affairs appropriations bill, the bill -- the senate passed that bill on july 20. congress didn't enact a single one of the annual appropriations bills through the regular order last year, nor a budget last year or this year. what kind of message do we send the american people when they are suffering under unprecedented and unacceptable economic difficult times? we are sending the message that either we are unable or unwilling to address the issues that are affecting their very lives. when i go home and find people without jobs and with half of

the homes underwater, when i find people out of work, when i pass by the shuttered and closed strip malls throughout my state of arizona, obviously, and then hold a town hall meeting, obviously, my constituents are angry and frustrated. and i don't know of a single town 0-hall meeting i've 3 had, not a single one, where someone stood up and said bass past the china currency bill and then our lives will be improved. i am sure with some the china currency bill is one of some importance and priority. certainly i don't think it's in the top ten priorities of the people i represent in the state of arizona. but our nation's security is important to my constituents. we have sizable military presence in arizona.

the national defense authorization bill that has passed through the armed services committee is very important to the people of this country and our security in these very uncertain times. i hope that the majority leader will agree to change his priorities and bring the bill to the floor, and i will continue to work to resolve concerns that he or the administration have expressed concerning the legislation itself. but because the executive branch has concerns about legislation and objections to legislation, that should not prevent it from coming to the floor of the senate. that should not be a reason why the senate shouldn't exercise its responsibilities to debate, to amend, and to authorize all these much-needed proirs

priorities -- priorities for the men and women who are serving our nation with courage and efficiency and it is our job to provide them with whatever they need to do their job in the most efficient fashion. mr. president, i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call: mr. sessions: mr. president. the presiding officer: the senator from alabama. mr. sessions: i ask unanimous consent the quorum call be dispensed with. the presiding officer: without objection. mr. sessions: mr. president, i'd like to speak on the currency exchange rate oversight reform act, s. 1619, that i

believe we will be voting on earlier, to move toward that bill. i support it. i respect my colleague from arizona and his principle commitment to trade and a vibrant competitive commerce in the world, but -- and i acknowledge that our commitment to commerce and trade is fundamental to our nation. america's always been a country with open ports and open markets when trade is conducted properly. i'm convinced it creates a rising tide of prosperity in america and around the world. so i'm not against trade. more than that, the voluntary exchange of goods does, i think, promote free exchange of ideas, trade has helped us export our values of a free democratic society, but like democracy itself, trade must

operate under a set of rules and values. jobs have been lost as a result of unfair trade practices and perhaps the most dramatic unfair trade practice existing in the world today is china's very substantial manipulation of its currency. 30%, 40%, 25% alteration this the value of their currency and it's created an extraordinary deficit that has cost jobs in this country. whether it's two million or less than two million --, it has cost jobs of decent, hard-working americans and it's occurred because of the manipulation of the currency. it's a very real matter. and we need to fight for and defend aggressively every single job this country has. as against unfair trade

practices. we need to say no. we're going to insist that the trade rules apply both ways. that we don't unilaterally accept virtually anything while some of our trading partners, and particularly china, can systematically violates those. so i think fairness is the right thing here, and we must refuse to acquiesce and accept this existing trade practice. look, nations whose economies have historically struggled are those that have failed to downhold a rule of law. in my view, that's fundamental part of america's greatness, is our commitment to law and has made us economically powerful as well as free. many nations that have been unable to ensure that contracts are honored and to protect the

integrity of financial agreements can't be successful in a commercially competitive world. when companies form a business partnership, they sign a contract to ensure that each party meets its obligation. the sprinl the same with -- principle is the same with free trade agreement. free trade. it must be founded on principles on which both parties can agree. principles and agreements which are to the mutual benefit of both parties. and it is the job of our leaders to negotiate these agreements on behalf of the american worker and not to stand against them. this is even more crucial with a nation like china, which relentlessly through its political apparatus seeks to advance its national interest.

china's currency manipulation clearly puts american workers and u.s.-based businesses at a huge disadvantage, particularly during this time of economic hardship. this unfairness has got to be confronted. we've talked about it but not confronted it. most economists, almost all economists agree that china intentionally undervalues its currency. by as much as 30%. the employment policy institute argues this, they say, quote, "this intervention makes the r.n.b. artificially cheap relative to the dollar effectivelily subsidizing chinese exports." where? most to the united states. so the devaluation of currency is i believe clear that it subsidizes exports of chinese goods to the united states. they go on to say, quote,

"currency intervention also artificially raises the cost of u.s. exports to china." so our goods that go to china are higher in china than they would be making chinese less able to buy them than otherwise would be the case, the goods they ship to the united states come in cheaper than the other -- they otherwise would be, making them more attractive to american consumers. and this is a big factor in the surging and huge trade deficit between our countries. i think it's indisputable that that is so. so in other words, the chinese give their products a 30% discount in the united states and make our exports cost 30% more in china. few economists, i think, would argue with that. china's currency manipulation has been a major afactor in the

erosion of our nation's manufacturing base and left millions of workers without jobs. it is a factor in job loss in america. in my own state of alabama the e.p.i. estimates -- and i don't know if this is an accurate number or not. i'm sure it is -- i'm sure we've lost jobs as a result of this currency manipulation. but this is the estimate the e.p.i. has. that it has put more than 44,000 people out of work in alabama since 2001. 44,000? we just celebrated a number of economic developments in my state, and we've been having some success over the years, we've got three automobile plants that investment from abroad, each one has about 4,000 jobs.

according to this study, we've lost 44,000 jobs to china as a result of this currency. again, there's disputes about how much and how large the impact is, i don't think there's any doubt that it's substantial and we've been feeling it for years. another recent study reached a similar conclusion. it was written up in "the wall street journal," and it found that regions exposed to trade, regions within the united states, exposed to trade from china lose more manufacturing jobs and see an overall decline in unemployment than other areas do. they also found that exposure to chinese imports led to larger increases -- this is common sense -- but they found the study did, that exposure to chinese imports that cost jobs in certain areas in the united states led to larger increases in unemployment insurance,

government payments, food stamps, disability payments, and other government benefits. based on data in the study, the $300 billion increase in chinese imports since 1992 -- $300 billion increase, has cost the federal government more than $20 billion in such expenditures. so it's a direct -- $20 billion they calculated in these areas simply based on increases in food stamps, unemployment insurance, and the like. and the irony behind this is that we borrow much of the money we use to pay these federal benefits from the chinese. which they then use to continue manipulating their currency. so we're being outmaneuvered and outnegotiated through the process.

last year dan damnico -- -- dan damico, president and c.o.e. of a corporation which has five steel mills in my state of alabama, smaller steel mills, testified that smaller meals and he is a national leader in american competitiveness and ideas. he testified before the house ways and means committee and this is what he said. quote, "passing this legislation will help us because this is a jobs bill, pure and simple. it will do more to stimulate the economy and create jobs than just about anything else congress can do and it will not add to our national debt. just the opposite. ending china's currency manipulation will reinvigorate our manufacturing sector and our economy, reducing our budget deficit. by failing to take the lead and

combat chin chean's mercantile ist trade practices we are serving up our jobs future, economic well-being and national security on a platter. close quote. that's a servers charge. this is a man who is dealing -- serious charge. this is a man who is dealing in the real world of production,the steel production, around the united states. plants all over the united states. and i think he knows a lot about what goes on in the world and how this system works. so the bill i have joined with my colleagues on, i believe is a thoughtful, commonsense preach. it does not place an immediate tariff on all chinese goods that enter the united states but it does, however, explicitly direct the commerce department and the international trade commission to take currency manipulation into account when

estimating counterveiling and dumping duties. under the current law, the commerce lay the commerce department can take manipulation into account when evaluating counterveiling duties but it does not. it does not take currency manipulation into account. it could, but it does not. and the obama administration has not instructed them to do so, and neither has his -- his predecessors. moreover, neither agency up currently has the authority to include currency manipulation in their calculation of antidumping duties. so the practical effect of this legislation would be to charge a duty on some imported products only after the international trade commission and commerce department conduct an investigation that determines that dumping is taking place or a subsidy is being provided and

that a united states company has been injured. so a duty would only be applied if it can be proved that the exporting company violated w.t.o. rules. in other words, this measure upholds the rule of law. this has nothing to do with protectionism. rather, it's about protecting the principles that make free trade work. you can't have a free trade relationship if your trading partners aren't complying with the fundamentals ex expectations of fair trading partners. if they're manipulating -- the speaker pro tempore: the senator senator's time has expired. mr. sessions: i ask for one additional minute to wrap up. the presiding officer: without objection. mr. sessions: nations like china are more than willing to exploit our goodwill to gain military, even, and economic advantage. the time has come to defend our

core economic interest. american workers are the best in the world. they aren't asking us for a handout or a subsidy. what they're asking for is leaders who will defend their legitimate interest on the world stage. so far, this has not been done. so i salute senator schumer, senator brown, senator graham, senator burr, snowe, stabenow, and others who have supported the legislation. i think it's time for us to act, and i ask my colleagues to support the legislation as we move forward. i would yield the floor. dur -- you mr. president? the presiding officer: the senator from illinois. mr. durbin: mr. president, i ask unanimous consent to speak as if in morning business. the presiding officer: without objection. mr. durbin: mr. president, i want to take those who are following this debate on a little trip through the world of plastic. i'm talking about the world of credit cards. in this case, specifically about

debit cards. because something happened over the weekend which has changed that world dramatically. and it's important for consumers, retailers, and voters across america to understand what happened. on october 1, on saturday, the rules on how much a credit card company and a bank that issues a debit card can collect every time you use the debit card changed. they call it a swipe fee. it makes sense. you hand them a credit card, or you do it yourself, and you swipe it through the machine and i pay for a transaction. back in the old days that i can recall, some people would write out a check. this is the new form of check. it's a debit card. and when you swipe it through the machine and the machine accepts it, the money comes right out of your checking account to the retailer, retailer where you did the business. it's very convenient. people are using it more and more. in fact, over half the transactions at most retailers now are done with either credit

or debit card. what the consumer doesn't know is that there is a charge each time that card is swiped. it is called the swipe fee or the interchange fee. it is established by tbot basically duopoly or monopoly credit card companies, visa and mastercard. they run the whole show and have been under antitrust investigation in the past. they set the rules. here's what the rules are. if you run a restaurant, let's say you run a grocery store in northern chicago like art potsah, a close friend of mine, family-owned grocery store. you say, i have to take plastic to do business. visa and mrkt says, you have to pay each time a customer swipes that card. it is a secret. basically consumers don't know. the retailers do.

the individual retailers have no -- we passed a law here, an amendment i passed to the dodd-frank law. find out how much it actually costs the bank and credit card company to process a transaction with a debit card. well, they came back after a long study and they said, if it uses a pin number, which some do, it's about four cents. if you sign it, it is about seven to 12 cents. and then they said, the average charge by the credit card company and bank for each swipe fee is 44 cents. dramatically larger than the cost of the transaction to the bank or the credit card company. rerks in the old days when we -- remember in the old days when we processed checks, it cost pennies no matter what the face amount was. but today every retailer faces

the 44-cent average swipe fee every time somebody uses a debit card. you can understand that some retailers don't like this much. there's no competition. these banks and credit card companies tell them, this is it, take it or leave it. you don't like it, don't use plastic. and it is secret. nobody 0 knows it except the retailer, bank, and credit card company. a hidden fee and it is a killer for a lot of small businesses. i was in rock island, illinois, and carl, who is the manager of the rock island country market, said, "we've got a special deal here, senator, people can come in and in the morning i give them a cup of coffee and a doughnut for 99 cents." pretty good deal in this day and age. sure is, compared to what we pay. "i want to get them in the store." they turn around and go to the cash register and use plastic. wcialtion i wasn't breaking even at 999 cents, now i am paying

some bank and credit card company because people are using plastic. that world changed last saturday. the new law went into effect where the federal reserve established the ceiling, the maximum that can be charged for a debit card swipe fee that's issued by the largest banks in america. and the maximum now comes down to about 24 cents. is this a big deal? well, it certainly is, because each year now in the economy, swipe fees ask account for abou0 billion or $12 billion in additional charges to consumers and loss of profitability by businesses. and so you can imagine, $10 billion or $12 billion even after it's been discounted by the federal reserve to about half that $5 billion or $6 billion, has the banks in an uproar. mr. chairman, i guess -- mr. president, i guess it's a great honor now, but "the wall street journal" published a

story on friday, and they had one of their people that they invited in to comment and he said that this new bank fee that's being charged by bank of america on cib on debit cards ie durbin fee. the same thing was said by another newspaper on saturday. i am honored to be connected with this effort. what we are doing is fair to try to strike some balance in an industry that has shown little or no balance. and one of the worst offenders in this is bank of america, the largest bank in the united states. did you see what they did on friday? they announced that anybody who had a debit card at bank of america was now going to be subject to a $5 monthly fee because of this reform. what i have said in the media and i'll say here is, bank of america customers, vote with your feet. get the heck out of that bank.

find yourself a bank or credit union that won't gouge you for $5 a month and still will give you a debit card that you can use every single day. what bank of america has done is an outrage, last week when they were charging each their customers $5 a month for the use of a debit card, they went overboard. but it's nothing new in the history of bank of america. consumers across america and the customers of bank of america are rightfully outraged. it is hard to believe that a bank would impose such a fee on loyal customers who simply are trying to access their own money on deposit at bank of america. especially when bank of america for years has been encouraging their customers to use debit cards as much as possible. it is particularly hard to believe this fee would come from a bank with a track record like bank of america. after helping to drive our economy off the cliff's edge in

2008, bank of america was happy to accept a $45 billion federal bailout for their stupidity, their greed, and their misstaifntle and it was just as happy to take that money and hand out $3.3 billion in employee bonus in the same year 2008. don't forget the track record of bank of america when if comes to handling mortgages. they picked up this country -- this company country-wide which had issued mortgages all across america that were going bad and now the record of bank of america when it comes to processing these same mortgages is equally disappointing. when it's not losing paper work or redpiewsing to answer the phone, bank of america is foreclosing on families right and left. but at least this time bank of america is being open about the new charge to its loyal customers. in contrast to the overdraft fees, research fees, swipe fees,

and other hidden fees that it charged, this time bank of america is being up front about sticking it to its own customers. and transparency is a good thing. it allows customers, as i said to vote with their feet. not every bank treats their customers like bank of america. and consumers can decide whether bank of america's values reflect their own. bank of america is the largest bank by assets in the united states. now it is crying poverty saying it is forced to hit their debit cardholders with this new monthly fee because congress passed swipe fee reform. i don't buy it. here's the reality: bank of america and banks in general are making billions of dollars still with this new reform in law off of credit and debit card swipe fees. swipe fees are an estimated $50 billion a year money maker for the banking industry. $50 billion. bank of america alone makes billions from swipe fees each year. but bank of america didn't earn

those fees by competition. instead, bank of america receives these billions because visa and mastercard basically fixed these prices and retailers and consumers have no voice in the process. this price-fixing has immunized the swipe fixing scheme in america. now that bank of america is out in the open, it is time for real competition to step income tax the federal reserve found that it costs a bank ogee average 7 cents to conduct a debit transaction, a signature transaction. it costs a lot less for bank of america with its economies of scaism but the fed found that bank of america was dpetting an average 44 cents instead of 7 cents. you can't make that type of a profit margin, nearly 600% in a transparent and competitive market n a free and fair market, these profits would be competed down a reasonable level.

without competition, credit card companies, these things, like bank america, will continue to win. consumers and retailers and of course now the bank of america's own customers will lose. today i have written a letter to the c.e.o. of bank of america, his name is brian moynihan. i have told him that not -- it wasn't just me alone, but others have done a little calculation on his $5 monthly fee. and you know what we find out? when they thought that the swipe fee was going to be limited to 12 cents, bank of america said, well, that will cost us $2 billion a year. turns out the federal reserve said, now, it'll be 24 cents. so by our estimates, this new reform of the swipe fee may cost -- may cost bank of america $1 billion a year in revenue. guess what? if you do the calculation, the $5 a month on the number of reported debit cardholders of bank of america, this'll bring

back twice as much as their projected loss on this new law. they're overcharge their own customers. once again, twice as much as they should if they just want to cover the hidden fees that they had in the past. that's unfair to consumers. it's unfair to their customers. it's unfair to do it in this tough economy when a lot of bank of america customers across america are struggling to get by. what i'm basically calling on mr. moynihan to do is to justify this $5 monthly fee based on their projected debit card transaction losses and the number of people that they have holding debit cards by their company. i didn't come up with this alo alone. a gentleman by the name of las rushings a business reporter in california, he was the first one that called it to my attention on the lehrer report on friday night. it is clear again -- again -- bank of america is overcharge #-g its own customers. well, i can just tell you, it isn't the first time. most people are aware of the fact that bank of america was

sued for overcharge for various fees like overdraft fees in the past. and because of that suit and the possibility of losing it, they entered into a settlement to pay over $400 million for overcharge their own customers. they're doing it again. bank of america, with this monthly feerks is overcharge its customers again by any reasonable standard for a loss of revenue based on this new law. but the last point i want to make -- and i see some on the floor, including the senator who may have a different point of view, but the last point i want to make is this: when i was back in illinois, i stood with the retailers, and i hope that the consumers of illinois and -- let's hear their story. they have been victimized by these banks and credit cards for too long. we establish a reasonable standard of compensation and now some disclosure about what is being charged for transactions. i want to help small businesses

and large retailers, too for that matter, across america. their profitability, the success of their business, means more americans go to work. if you want to stand up on the floor of the senate and defend the wall street banks like bank of america and the credit card companies, be my guest. i would rather stand with the consumers and retailers who've been taken to the cleaners for years and years by these debit card swipe fees. the latest outrage of bank of america is a reminder that when it comes to valuing customers, banks that don't overcharge for debit fees are the ones that deserve america's business. mr. president, i yield the floor. the presiding officer: the senator from tennessee. ismr. corker: mr. president, thank you. i understand i have ten minutes. if you'd let me know when i have about a minute left, i'd appreciate it. i was here to speak on another topic but i was glad to hear the comments of the senator from illinois. i would say in general eurpbg consumers across -- i think

consumers across our country are beginning to see the first of many consequences of dodd-frank. sometimes i think my friends on the other side of the aisle believe that money just comes from air. but the fact is when you price fix something like was, we just did or like the senate just did through dodd-frank, when you price fix something like this, obviously it's going to have the consequences that have been laid out. unfortunately, consumers across our country are going to be paying the price. it's interesting that most of the major retailers that my friend was alluding to are all talking about the profits, the benefits they're going to have from this. at the end of the day it's the consumers that are going to be paying the price. we're already seeing that play out. while bank of america, i'm not here to defend them, this is just the first of many, many charges and lack of credit that's going to be a part of our american society as a result of dodd-frank. let me say, mr. president, i

came to talk about a bill we're getting ready to debate i understand this afternoon at 5:30. it's a currency exchange rate oversight reform act of 2011. i probably won't recite that again, but that's the bill we're going to be having a cloture motion on tonight at 5:30. let me say, mr. president, i understand how people across this country are very frustrated about our economic situation. i'm very frustrated. i'm frustrated for the people of tennessee and the fact that our economy is not showing the kind of growth we'd all like to see. and i understand how politicians like to respond to things back home by making it look as if they're doing something to benefit the folks back home during this tough economy. mr. president, and i plan to speak at length on this throughout the week, this bill that's being debated, the bill that's going to be on the floor tonight is not the answer. most of you know that tonight we're going to begin debating a

bill that would call china in essence a currency ma nip later. by the way they are a currency ma nip lay tor. i agree with that. the response wants to put tariffs on chinese imports and what i believe will happen is going to be a trade war. what i'd like to say is this is the u.s. senate. i understand that sometimes a hot bill will make it out of the house for lots of reasons just due to its makeup. i understand that a lot of times a bill like this comes forth for messaging. mr. president, what i would say is we're actually playing with fire here. this is something that's originating in the united states senate. it's a place where typically things are to cool, and we're to think through things. i'm hopeful that we'll have a vigorous debate on this and many amendments because, mr. president, my concern is that at a time in our country, at a time in our country when we have a tremendous -- we've had a

financial crisis which has led to the type of economy that we have here, what we'd like to see many people of our country have greater and more full employment, at a time when we come off high energy prices just a few years ago that sucked a lot of life out of this economy, at a time, mr. president, when the global economy is slowing due to much, much due to the financial crisis that is occurring right now in europe, i think the response that we want to put forth is not though create a trade war with china. i think most of us know that china has been a currency ma nip later. they have a -- manipulater. we would like to see that rise more quickly than it has. the point is they are making changes. china has an antiquated financial system that has to be changed. it has to be liberated. it has to become more like what we have in this country. and those steps are happening.

there's no doubt that people who import, that importers, there's no doubt that the goods that come here from china come at a lesser price than they otherwise would because of the currency float that they put in place in china. i understand that. but that is changing. and the fact is that with a country of $1.3 billion, we have an opportunity as a country and as their standard of living continues to grow, we have an opportunity to have even more trade with this country. our exports to china have grown sixfold over the most recent time. here we have an opportunity in this chamber very soon to take up three free trade agreements with south korea, panama, and colombia, trade agreements that we've wanted to have in place for a long time. here we are the united states senate, a body that is supposed to act with cooler heads -- and again, i understand the pressures back home. i have them too.

our state has tremendously high unemployment, much higher unemployment than i would like to see happen. i know that when i go to town hall meetings, people talk about china, and i understand that. but i think people may be misreading what is in this bill. and i think a lot of people think that this bill is sort of a plaything because it actually gives the president a chance to waive tariffs on goods that happen to come here cheaper because of currency manipulation. but that's not the case. that's not what this bill says. and a lot of people have misunderstood what this bill says. they think that it's sort of a plaything, and the president can make it all right. the president, if you will, can be the adult and not create a trade war, but that's not what the bill says. the bill says that he has, that this country has to put in place tariffs on goods coming in this

country as long as they're not being dumped into this country. if they come in at a competitive advantage, we have to put in place tariffs. is this what the u.s. senate wants to do today? we've got a tremendous financial crisis. we have high unemployment in this country. we're tremendously overregulated. we're not doing the things within our own country that we should be doing, that many of us have been arguing to cause our economy to grow. we have a financial crisis that's taking hold and taking root and actually moving in parts to this country and hurting us. the markets are down. and so the united states senate, a body of 100 people that are elected for six-year terms, wants to put in place tariffs on a major growing country that we have growing exports to and create a trade war, a trade war

between 2002 largest economies in the world. that's our response? instead of understanding the best thing we can do for this country right now is to deal with those long-term solutions in our own country. and as this deficit-reduction -- ask this deficit-reduction committee to go big, get $3 trillion, to do tax reform, to do entitlement reform. those are the kind of things we ought to be doing in this country. passing a six-year highway bill, producing american energy, reducing regulations that are impeding our economy and not really helping the country. those are the kinds of things we ought to, but that's a response that the united states senate, people with six-year terms that were elected to be the cooling, the cooling of legislation, not to originate bills out of this body that we know if passed will likely create a trade war. look, it's like this country has

lost its ability to see the fact that we're an exceptional country. it's like we're cowering down now. it's like we know what to do but we won't do it. and instead now we've got to find a bogeyman. do i like what china's doing with their currency? no. is it changing? yes. is our country putting pressure on china to change? yes. is it occurring? yes. it's going to have to. the middle class in china is going to want access to the kind of goods our country produces. it's naturally happening. so why would we as a country tamper, tamper at this time of a global slowdown, tamper with creating a trade war? mr. president, again, i understand and i know that many of the senators in this room hear the same things back home that i hear back home. but the last thing we need to do at this point? world history, at this point with the global economy as it is

today is repeat the same mistakes that happened back in the 1930's with smoot-hawley. that's exactly the path we're going down. it's as if we don't learn, as if we don't learn from history. mr. president, i urge all senators to think about this. i understand we're probably going to move to this bill tonight. i do hope we have a vigorous debate. i hope we change this bill dramatically, if not just kill it. but i think senators need to understand, in my opinion, we're playing with fire. mr. president, this is not the right thing for us to do. we need to be focusing on how we make this great nation, the greatest nation of all times, grow. and we can do that by dealing with our own issues here internally. we know how to do it. and we can do those by courageously dealing with the long-term issues that confront this country. that will be the short-term stimulus this economy needs. mr. president, i yield the

floor. the presiding officer: the senator from -- mr. corker: i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

mr. schumer: i ask unanimous consent the quorum be withdrawn. the presiding officer: without objection. mr. schumer: i ask we move from morning business to the pending legislation. the presiding officer: the morning business is closed. under the previous order, the senate will resume consideration of the motion to proceed on s. 1619, which the clerk will report. the clerk: motion to proceed to the consideration of s. 1619, a bill to provide for identification of misaligned currency, require action to

correct the misalignment, and for other purposes. the presiding officer: under the previous order, the senate -- the time until 4:30 p.m. will be equally divided and controlled between the two leaders or their designees. mr. schumer: thank you. mr. president, i ask unanimous consent that the following members of my staff be granted -- and the committee staff be granted floor privileges during the consideration of s. 1619 -- jane beard, sara babcock, sara harshman, madeleine forbis, steven simpson, jonathan goldman, and miranda dalpiaz. the presiding officer: without objection. mr. schumer: mr. president. the presiding officer: the senator from new york. mr. schumer: i rise today in strong support of s. 1619, the currency exchange rate oversight reform act. first, i want to say this bill is the culmination of years of hard work and collaboration between democrats and

republicans. i'd like to thank senator lindsey graham of south carolina. he and i have been partners in this endeavor for over five years. we have traveled to china together. we have worked long and hard to troy and gain -- try and gain some fairness in the way china treats american industry, particularly in regards when it comes to currency. i'd like to thank senator sherrod brown and senator debbie stabenow. both made very valuable additions to the proposal on our floor today, and in fact senator brown is the lead sponsor of this legislation because of the strong and good work that he has done. and they both have worked long and hard, realizing the industries in their state are at such a competitive advantage. i'd like to thank my colleague, jeff sessions, as well, who has been one of our partners and leaders on this legislation. over the last several months, and lead sponsors. in addition, bob casey, olympia snowe, jeff sessions, kay hagan

and richard burr, as well as dozens of other cosponsors on this bill for their work on this issue for many years. i also want to particularly express my appreciation to chairman max baucus and former ranking member of the finance committee, chuck grassley, for their leadership and work on the -- on currency manipulation. we believe that our bill is w.t.o.-compliant, and it is in part because senators baucus and grassley looked at our original bill and worked with us on suggestions as to how to change it to make it just as effective but within the rules of w.t.o. mr. president, today we have an opportunity to help put middle-class americans back to work and, amazingly enough, in a bipartisan way. today we stand together to defend american jobs against market-distorting, job-killing,

exchange rate policies that subsidize foreign manufacturers at the expense of american manufacturers. these currency policies artificially raise the price of u.s. exports and suppress the price of chinese imports into the united states. undermining the economic health of american manufacturers and their ability to compete at home and around the globe. china is by far, by far the biggest exploiter of predatory currency practices, but our bill doesn't target china or any one country. our bill rather says that there will be consequences for any country that engages in currency manipulation to gain an unfair advantage over american businesses. mr. president, it's been ten years since china joined the w.t.o. in those ten years, the economic policy institute estimates that 2.8 million american jobs were lost or displaced in

manufacturing and other trade-related industries as a result of increased trade with china and the chinese government's manipulation of its currency. my state of new york has suffered some of the biggest losses with over 161,000 jobs lost or workers displaced since 2001. accession to the w.t.o. was supposed to bring china's policies in line with global trade rules meant to ensure free but fair trade. instead, china has single mindedly flouted those rules to spur its own economy and export-oriented growth at the expense of its tradings partners, most of all the united states. our economic relationship with china needs a fundamental change. it's not just in currency, although that's the number one issue. on issue after issue after issue, whether it's poaching

intellectual property, unfairly and illegally subsidizing chinese businesses, monopolizing rare earths, not allowing american companies to compete in china, on issue after issue after issue, china is mercantilist, plain and simple. they use the rules of free trade when it benefits them and spurn the rules of free trade when it benefits them, and for years and years and years, americans have grimaced, shrugged their shoulders, but never done anything effective to in large measure stop the chinese pursuit of unfair mercantilism. six years ago, i was in upstate new york and a steel manufacturer told me, mr. president, that they could

compete against chinese steel just fine, even with labor costs being lower in china, except for the fact that china manipulated its currency and it gave chinese steel imports a 30% to 40% advantage. the owner of the company, 300 good-paying jobs, pleaded with me to do something. i happened to speak to senator graham, and he was finding the same thing with industries in his state of south carolina, and we began our crusade to get china to behave fairly. at first, people didn't even accept the fact that currency manipulation was wrong and harmful to america. i remember at one point within a short period of time, both "the new york times" editorial page, a decidedly liberal editorial page, and "the wall street journal" editorial page, a decidedly conservative editorial page, both said china shouldn't have to let its currency flow --

float, even though it's a tenant of free trade. bretton woods said the way to correct large imbalances in free trade is to let a currency adjust by floating. well, we spent years convincing america, convincing our colleagues that this manipulation of currency dramatically hurt america and was unfair and against all tenets of free trade, and we have achieved that goal. now the editorials may pick reasons why they don't like our particular bill, but they say oh, yes, we have to deal with chinese currency manipulation. but when you ask people who say don't do your bill, deal with it a different way, we say how? no one has another answer.

now, it was true that our initial bill, introduced five years ago, was a blunt instrument to bring attention to the issue. it was our hope then not to pass the legislation. in fact, we allowed cooling off period after cooling off period in the legislation, but rather just simply to get the chinese to act. but about three or four years -- after three or four years, senator graham and i became convinced that china would not act. when there was real pressure, they might move the currency a little bit, but then they would back off. and the same proved true in other areas where china unfairly treats american industry. and so we came to the conclusion that legislation was the only answer, no one having a preferred or even seemingly possibly effective alternative.

and so we worked, as i said, with senator baucus and senator grassley and came up with a proposal that we believe meets w.t.o. rules, and then because senator stabenow had worked long and hard on this issue, along with senator collins, we combined her proposal and our proposal -- hers was mainly focused on the banking committee, commerce department, ours on treasury, and then senator brown and senator snowe a year or two ago had an additional proposal, and we have combined all of these proposals into one workable bill that will finally get fairness for american companies. over the past six years, we have

been sending a message to the chinese government about their exchange rate policies, every treasury secretary since we began this crusade said you know what? let me just talk to the chinese. i can bring reason to them. and they did it with the best of intentions and the best of hopes, and every treasury secretary, casting no aspersions on any of them because the fault was china's, not ours, couldn't get progress at all. so it's down to this, mr. president. if we want american companies to have a fair chance of competing, this is the solution. not everyone will agree with every jot and tittle in this bill, but i think the vast majority of my colleagues will agree with its thrust and the need to do more than we have been doing, and for that reason, i am hopeful that large numbers on both sides of the aisle will

vote for this motion to proceed so we can begin debating this measure and listen to some amendments if people have ideas as to how to change it. let me go over our bill. our bill's intended to give the administration additional tools, this administration are ready to use if this country fails to take steps to eliminate currency misalignment. the bill would prohibit the federal procurement of products or services from a country that fails to adopt appropriate policies to take identifiable actions to eliminate currency alignment. our bill also uses u.s. trade law to counter the economic harm to u.s. manufacturers caused by currency manipulation. the artificially low value of the yuan, economists estimate it's anywhere from 20% to 40% less than it should be. amounts as is well known now to

a subsidy on chinese exports and a tariff on american exports to china and other countries. under existing trade laws, if the commerce department and the international trade commission find that subsidized imports are causing economic harm to american manufacturers and workers, the administration must impose duties on those imports to offset or counterveil the benefit conferred on foreign producers and exports by government subsidies. congress already has the authority under u.s. law to investigate whether currency undervaluation by a government provides a countervailable subsidy, although it has failed to do so despite repeated requests by industry after industry to investigate. our bill specifies the applicable investigation initiation standard, so commerce can't just turn its back on these companies, and it will require commerce to investigate whether currency undervaluation

by a government provides a countervailable subsidy if the u.s. industry requests the investigation and provides the proper documentation. our bill also clarifies that commerce may not refuse to investigate a subsidy allegation based on the single fact that a subsidy is available in circumstances in addition to export. mr. president, our bill also uses the term "currency miss alignment" but it's not just a term. administrations, both bush administration and the obama administration, have, to the amazement of many americans, refused to label china a currency manipulator but manipulation is a subjective standard of involving intent. what we do is refine that concept and go for misalignment. we believe misalignment is the appropriate standard. that is not subjective. it's not saying why it's misaligned or how or do oh did

it, it's a narrower standard, it's a standard that is harder to wriggle out from under if somebody -- any government official is intent on not enforcing the rules that we think necessary to get the chinese to act. so the bill is carefully thought out. the decimation of our middle class, our manufacturing sector, and the american economy as a whole is due in part to developing countries like china employing currency manipulation and other aggressive mercantilist tactics to tilt the field so much in their favor. in the absence of action by the administration, we have a responsibility to protect the interests of american workers and companies. now, one of the questions that is raised is, is our bill w.t.o. compliant? and we believe it is. we have worked hard taupe sure it is. -- hard to ensure it is.

the bill provides the president with flexibility to waive any consequences that might have an adverse impact on the u.s. economy and the bill also continues to allow the u.s. government trade officials to do their job and make the decisions on the basis of facts argued before them. we have talked to many experts in the field, and they, too, believe that our bill is w.t.o. compliant. now, what do the critics say? no one criticizes the idea that china manipulate -- has manipulated its currency. no one criticizes the thought, the actuality that china minutes its currency and almost everybody thinks not enough is being done. the main argument against our bill is not the bill itself. but critics of the bill worry that, oh, maybe this could start a trade war with china. well, i have news for them: we're already in a trade war with china, and we're losing.

china by its mercantileist policies on currency above all but on rare earth and intellectual property, on sub disiddation of homegrown industries, exclusion of american exports where we might have advantage, they're already engaged in a trade war and the result is that millions of americans don't have jobs that should. the result is that hundreds of billions of dollars flow out of america into china. and if we don't do anything about this, our country will be hurt badly, perhaps irreparably some argue well -- "the washington post" did today, that it won't have much of an effect because the industry of china has to revalue its currency, these industries will go to places like bangladesh.

they're making an argument that's ten years old, five years old and stale. we're not arguing about labor-intensive industries like clothing or shoes or toys. those are going to bangladesh already with the cost of chinese labor going up. china uses its currency manipulation against our topnotch manufacturers. the large companies say nothing because most of them have plants in china so they can get around it. but middle and small-sized manufacturers are up against this wall and are desperate for our help. one manufacturer in upstate new york makes a very advanced product that deals with cleaning pollutants as they go through a power system. it's a topnotch product. and this manufacturer employs a couple of hundred people in upstate new york. said to me china is stealing my stuff even though i have patents

and other things on it. they're stealing the method biby we do that. i could live with that if they just sold the stuff in china. we're not big enough to export all around the world. but what they do is not only do they steal our intellectual property on this, but then they come back and sell it in america at a 30% discount because of currency manipulation. he said how am i going to compete with that? there's story after story after story just like that, mr. president. and when american companies are fighting for their survival, battling subsidized chinese exports, high-end exports, this is no longer an argument about labor-intensive industries alone, i for one am not prepared to raise the white flag on american manufacturing and on american jobs. and neither should anybody else. i know that american

manufacturing can compete successfully against chinese competition at home and in china and around the world but only if the playing field is level and our bill helps to level that playing field. critics of our bill say that while currency manipulation is an important issue, legislation to address it would ignore the many and growing challenges that we face in china. the critics are wrong. we have no intention of ignoring the range of china's market-disporting practices, the ones i've mentioned before. but in fact because china was emboldened on currency which the whole world -- brazil just a week or two ago asked china to stop manipulating its currency, the european union feels the same way we do. but because nobody does anything, china is emboldened to pursue mercantilist policies in other areas recently in rare

earths where they tell manufacturers, if you want rare earths, you'd be better off sending your plant to china. it's just unheard of. critics of our bill say it's unlikely to create incentive for china to modify its exchange policies. the experience senator graham and i have had is when china thinks something might be done they begin to let their currency rise. because nothing permanent is done, they go right back to their old habits as soon as the pressure is off. this idea that if we pressure the chinese, they won't do it, makes no sense because if we pressure them, they do nothing and if we don't pressure them, they do nothing. the only answer is concrete legislation. what would those who oppose this bill have us do? what is their suggestion? they don't really have one. should we continue to sit back and watch -- watch while american jobs and american

manufacturers and even large chunks of american wealth just drift away? should we continue to, as one of my constituents put it, be not uncle sam but uncle sap? well, there are too many of us in this chamber on both sides of the aisle who will not sit back and continue to let mercantilist trade practices continue to decimate american manufacturing and american jobs. middle, low, and high. nor will my colleagues here in the senate, democrats and republicans, are united on this issue. we must take decisive action against china's currency manipulation and other economically injurious behavior. the fact that they manipulate their currency imbalances the whole world trading system.

many economists list it as one of the reasons we had the decline in global trade and the worldwide recession that we've had. we simply have no choice. but to right the wrong that china is committing. any retaliation by china would be further evidence of their unwillingness to meet their obligations under the w.t.o. and the global trade community. and by the way,, china has a lot more to lose with retaliation than we do because if there is one country that gains the most by exporting to the u.s., by international trade, it's china. and they are very, very smart and they're not going to cut their nose to spite their face. i whole heartedly support the president's goal of doubling u.s. exports over the next five years. but that cannot be done if we don't take concrete action to address the protectionist

practices of foreign governments who concede tariff reductions only to replace tariffs with currency manipulation, border taxes and a variety of state subsidies. we will not do it unless we get to the root cause. china's currency manipulation would be unacceptable even if good economic times. at times of high unemployment we can no longer stand for it. there is no bigger step to create american jobs that we can take than to confront china's currency manipulation. it's not a democratic or republican issue, mr. president. every one of us has manufacturers, companies that are struggling to compete at home and abroad with chinese exports with a built-in price advantage. it's not about china bashing. it's about fairness and defending american jobs. mr. president, many of us and most americans are worried. what will things be like 10 and

20 years from now? will america stay the leading economic power of the world? will our children have a better life than we do? the number-one thing we have to do is change things at home to make that better. there is no question about it. but very high up on the list as well is making sure that china no longer unfairly sucks millions of jobs and hundreds of billions of dollars of american wealth to its shores. what china does will make our job of keeping america strong, of having the next generation live a better life than this generation far more difficult unless we force them to change because they won't change on their own. passage of this legislation will lead to real consequences for countries that unfairly manipulate their currency. we've waited a long time. we've declined to move the

legislation at the request of two administrations. but patience, not of us, but of the american people, has worn out. i ask my colleagues to stand up with us on s. 1619, to stand up for american manufacturing, for american jobs, for american wealth, to stand up so that our children can have a brighter future than we have. i yield the floor. mr. hatch: mr. president. the presiding officer: the senator from utah. mr. hatch: i've enjoyed the remarks of my distinguished friend from new york. as we begin the debate today on the important issue of exchange rate misalignment it is an important debate though i seriously question its timing. let's step back for a moment. at the end of last month the u.s. senate approved legislation

renewing and expanding trade adjustment assistance. we need to be clear about what this program is, a big governmenten spending program of dubious value but one that is important to proox president obama's union allies. given the, this country's spending program is top trade priority. so much so that he was even willing to abandon our allies in colombia, panama and south korea unless he secured this additional spending. to get more government spending for big labor, the president was willing to hold up the three free trade agreements with colombia, panama and south korea everyone negotiation will grow this economy and create jobs. i was happy to chat with the trade representative just a few minutes ago, and he told me that they are going to send those three trade agreements up to today, and they should be here between 4:00 and 5:00.

i'm really happy about that. it's way beyond time to get them here. but americans need to remember this episode when they hear the president talk about his commitment to job creation. put aside all the talk, it is clear where the rubber hits the road. the president will prioritize government spending over private sector job growth. still, because of the president's insistence on this spending program, the t.a.a. bill is likely to pass the house and become law. here's my question: given that we just debated a trade bill we knew would likely become law, why was this currency bill not considered in that context? i can only conclude either that the administration opposes the currency bill and therefore asked that it not become part of t.a.a. or that consideration of this bill was merely a political exercise with little expectation that it ever will become law. with millions of americans out of work and the economy stagnant, the people of utah and all of america's citizens

deserve more than political grandstanding. regarding the substance of the issue, the manipulation of currency values by major trading partners to gain unfair trade advantage represents a genuine threat to u.s. jobs and rebalancing of the global, financial, and economic system. for many years and continuing into the present that threat is a reality. there isvirtually no unanimous t among international analysts that there exists large-scale one-way intervention in exchange markets by some of our important trading partners in order to limit our preclude currency appreciation. primarily in china but also in some of the other economies as well. there senior senator seems to be little question that china manipulates its currency in order to subsidize its exports. the bill before us seeks to address exchange rate misalignments specifically and global imbalances generally.

by sharpening the tools available to counter currency manipulation by a trading pan. of course any additional tools that we construct must be crafted to line all of our international trade agreements and global rules of trade. the issue of china's currency has been with us for far too many years. we have repeated discussions about how to address the lack of appreciation of china's currency followed by diplomatic bilateral discussions, assurances of moves from china to allow appreciation, some modest subsequent appreciation while the political heat is on, and little change thereafter once the heat subsides. this approach does not seem to be working. we've had large and persistent bilateral trade deficits with china and those deficits continue. we have relied on china's

massive excess savings to finance our growing debt, and we have worsened that reliance given the debt-fueled spending spree of the current president. china's dollar denominated reserve holdings which have grown, ballooned to over $3 trillion according to some recent estimates -- this is a 50% increase. the currency misalignment by china is not the only source of global financial and economic imbalances. if the president looked in the mirror, he would see his own responsibility for global economic uncertainty. our budget deficits have far exceeded $1 trillion for the past three fiscal years. for 2011, the deficit is expected to be around $1.3 trillion, which is an unsustainable 8.5% of g.d.p. and

the third-largest deficit in the last 65 years. exceeded only by deficits in 2009 and 2010. deficits of this magnitude have not been seen since the years surrounding world war i i, when virtually the entire economy was being directed by the federal government. given our budget deficits and the china currency issue, the important question is, what is being done? let's look at what is being done with a bit of recent history for context. back in 2008, then-candidate obama wrote the following to textile organizations: "the massive current account surpluses accumulated by china are directly related to its manipulation of its currency's value. the result is not good for the united states, not good for the global economy, and likely to create problems in china itself." now, he went on to promise that,

if elected, he would use all diplomatic means at his dispose poll to induce china to change its foreign exchange policies. he promised to beef up u.s. enforcement efforts against unfair trade practices. also back in 2509 during the treasury secretary's confirmation hearing before the senate finance committee, now-secretary geithner stated that "president obama backed by the conclusions of a broad ravening economisrankof economit china is manipulating its currency." those are strong word. yet once in office the president and secretary geithner a failed to follow up those words with action. the administration promised tosher in an era of change but failed to change the way the u.s. deals with the china currency issue. the act of 1988 requires that the treasury secretary report on exchange rate policies of major

u.s. trading partners. under the act, treasury must consider whether countries manipulate exchange rates for purposes of preventing balance of payments adjustments or gaining unfair trade advantage. the evidence clearly seems to show that china's current policies amount to manipulation leading to an unfair advantage in international trade. candidate obama agreed during his campaign. treasury secretary geithner agreed during his confirmation testimony. yet as treasury secretary and as president, the two have refused to afnlgt secretary geithner has issued five foreign exchange reports but has refused to label china as a country that manipulates its exchange rate for the purpose of gaining unfair competitive advantage in international trade. let me repeat that. despite many bold claims about using all the tools at their

disposal to counteract china's trade policies, the administration refuses to designate china's policies as being consistent with currency manipulation for trade advantage. now, the question that i and most of moi colleagues from both sides of the aisle have is, why? clearly, the administration must recognize the consequences of china's manipulation for american workers and manufacturers and for the stability of the global financial and economic system. why then is the administration protecting china by refusing to designate it as a currency manipulator? under the omnibus trade and competitiveness act, once a country is so designated, there are no draconian actions required. the immediate repurr cogs are merely stepped up conmering and greater vigilance and dialogue. those don't seem to be things

that would lead to cren sawyer trade wars. so why does the administration act? after all, american jobs are at stake. american workers are compete with any workers in the world, but our workers should not have to compete against foreign firms that receive massive subsidies. if the president is as intent on focusing on job creation in america as his campaigning suggests, then why has he refused to take such a simple step as designating known existing currency manipulation? there's a severe mismatch here between political action and rhetoric. overseas funding in particular from funding from china to finance their sploadzing deficits is preventing the president and his officers from acting on behalf of the competitive but struggle american workforce. it is well past time for the administration to recognize the

negative consequences of china's manipulations for american workers and manufacturers and for global stability. even though there has been only tepid support even on the democratic side of the aisle for the president's much-towbted jobs plan, there is agreement that congress needs to address the massive jobs deficit this nation is facing. we face a national crisis in having unemployment persisting at over 9% with elevated numbers of the unemployed suffering from long-term bouts of joblessness and with many american workers having become so discouraged that they have simply dropped out of the labor force. according to statements by the majority leader of the senate, the focus on jobs is precisely why we are considering the bill before us. according to one of those statements, the majority leader is reported as having said that -- quote -- "i don't think there's anything more important

for a jobs measure than china trade." unquote. i'm staforting to think that my -- i'm starting to think that my friends on the other side of the aisle are like the gang that couldn't shoot straight. the majority leader thinks that addressing china trade is essential to job creation but based on its failure to use existing tools available to designate china as a currency manipulator, the administration apparently disagrees or it would have long ago used its authority to make such a designation under the omnibus trade and competitiveness act and then acted on the problem. the president's focus seems to be elsewhere. he seems to think that at least as important -- he seems to think that at least as important for jobs as the issue of china trade identified by the majority leader is his so-called american jobs act. advertisements by the democratic national committee and campaign speeches by the president since

he announced it in a joint session of congress last month calls quite clearly that "we should meet our responsibilities" and consider that act "right away. " yet my friends on the other side of the aisle believe that a political debate over china and its currency policies are more important for job creation than the president's american jobs act. if the president's act is, as advertised, so crucial for job creation in the facing of our national unemployment crisis, why is democratic -- senate democratic leadership delaying its consideration? why not consider the legislation right away as demand by the president in his campaign speeches and democratic national committee advertisements? we are told by the president that americans who are out of work cannot wait until the next election for us to act boldly for job creation. so why are we not considering this american jobs act unless my democratic friends disagree with the president that the act would be the most important job

creator available to us today. i really don't believe anybody believes that. i suspect that they know that the $447 billion in new stimulus spending included in the president's jobs bill and the accompanying proposals to impose $1.5 trillion in new taxes on a sluggish economy is economically counterproductive and a sure-fire political loser. i must say that the president's jobs act looks like more of the same debt-fueled stimulus spending cloaked under the guise of "investment" along with higher taxes, under the label "tax reform. qulings "while i may disagree on the particulars of the present proposal, i do not disagree with his premise that we face a national crisis in our labor markets and that we should be debating measures that will promote american job creation now without delay. we are also told by the president that we must pass our pending trade agreements with

colombia, panama, and south korea. jobs are at stake, he says, and with the political campaign rhetoric exhorting congress to pass the president's american jobs act which the majority leader has opted to shelf until some unspecified future day. the president delayed the action required to get these matters passed for much too long. pass the americans jobs act the president scolds but we can't because the majority leader has not brought the act to the floor. the currency bill which is unlike will you to lead to any job creation before the next election has come first, perhaps to allow more time for campaign speeches and ads by the democratic national committee. pass the free trade agreements, the president lectures. but they were delayed, as they have set idly on his desk. i'm pleased that the trade leader in the administration

called me a few minutes ago to tell me they are on their way up here today. this currency bill is coming first. but what needs to come first is job creation, not electioneering and politics. and i hope before this week is over we'll turn to those three trade agreements and pass them through both houses of congress, as according to the administration they will be responsible for creating as many as 250,000 jobs. i doubt it'll be that much, but nevertheless that's what the administration says. that's their estimate. our jobs deficit ask is a full-blown national crisis. the unemployment rate has been persistently above 9% since april of this year. it has averaged 9.4% since the president took office. it has been about 9% in 26 of the last 31 months since the president took -- well, 26 out of the 31 months sing the president took office, despite

promises by administration economists that the massive debt-fueled stimulus which will cost over $1 trillion when all costs are included would keep unemployment contained below 8%. and the unemployment rate is even higher. the underemployment rate is even higher at over 16%. once you include, for example, people who want to work but have become so discouraged that they no longer look for work. nearly 14 million workers are unemployed and the number grows when you include discouraged workers. the number of long-term unemployed workers has been at record highs. according to census data released last month, those in their 20's and 30*rs are suffering from the highest unemployment rate since world ward ii. the enthusiasm of young citizens in 2008 long ago gave way to disappointment and disaffection. our joblessness crisis is nothing short of a crisis for liberty.

when american men and women do not have jobs and opportunity, their freedom to make lives for themselves is eroded. yet we are to understand that in the face of this crisis there ts no more important issue regarding jobs than our bilateral trade with china. again, agree that we need to address the issue of exrency manipulation in our sustained and large trade deficits with china. however, let us be clear that dealing with issues related to china involves only one bilateral trade relationship. the trade and current account problems facing the united states and the global financial trade and economic imbalances that everyone faces are not solved by addressing this one trading relationship. that is one reason i will be offering an amendment to this bill calling for multilateral and plural lateral negotiations to address currency misalignment.

if we are going to succeed, we need to look at the big picture and work with our allies to counter china's current practices. i will discuss my amendment in more detail soon but hope it will receive strong bipartisan support. our trade imbalances are not with china alone. rather, as part of the problem of saving too little, the u.s. has multilateral trade imbalances which require more action than focusing solely on one bilateral relationship. according to recent data from the united states international trade commission, the u.s. has trade deficits with nearly 100 countries. the u.s. saves too little, and that problem will not be solved solely by passing the bill before us. make no mistake, the legislation we are considering can provide useful tools for addressing concerns about china if the administration actually uses the tools. those tools alone are not sufficient. if we try to address our multilateral problems by putting

pressure on china alone without attending to our lack of saving and our own role in generating trade deficits with nearly 100 countries, the chinese piece of the u.s. imbalance will migrate somewhere else. this bill is not a magic bullet to solve our problems or problems arising from global imbalances and it almost surely is not the highest priority piece of legislation if job creation is to be our focus, is truly our focus. the u.s. for its part contributes to global imbalances by persistently saving too little. following the financial crisis which was precipitated partly by large run-ups in household indebtedness, american families have tightened their belts to save more and repair their own balance sheets. it is the u.s. federal government that has been missing in action to restore national savings, reduce our federal debt and promote global balance. rather than repair the federal balance sheet, the

administration has chosen to run trillions of dollars of debt fueled deficits and borrow ever increasing sums from abroad, including china. and rather than facing the fact that the federal government has a spending problem, the president is advertising and campaigning on a new american jobs act stimulus and tax hike platform containing even more spending and short-term debt accumulation. we are told that it will be in the interest of the american people to borrow more today in order to spend more on infrastructure, for example. the stimulus proponents say interest rates are low, so let's ramp up borrowing right now. that's the same approach the senate took when it voted to extend and expand trade adjustment assistance. they ignore that piling trillions more on to our national credit card issued by china and our other creditors moves us that much faster into the company of the euro zone

countries who now face default and elevated interest costs. while federal borrowing rates are low today, what happens when global factors tire of our profligacy and debt-financed spending and begin to demand higher interest compensation? as spain and italy have seen, low interest rates are not guaranteed and the interest rate environment you fake faze canopy srot on a -- can pivot on a dime and escalate rapidly. borrowing on low rates today sounds great unless you're forceed to finance at more punitive rates. more government spending is sthaourl drag us down -- surely to drag us down the road we are seeing in europe. the president claims his new stimulus and tax hike proposals are all paid for, but the payments are largely promises of

future austerity, and anyone who has paid attention knows that federal government promises to go on a spending diet later never lead to fiscal weight loss because future congresses are not bound by today's promises. it is interesting to hear the president's persistent calls for more debt-fueled infrastructure spending. presumably given his interest in job creation, quote right now, unquote, the projects he has in mind will be more shovel-ready than the readiness of the previous stimulus projects which turned into something that the president found so funny that he joked about it. of course it is no joke to jobless americans who are stuck with the stimulus debt bill. we heard in early september from the chairman of the president's council on jobs and competitiveness that the council identified -- quote -- "ten high-priority infrastructure projects based on their potential to put americans to work right away.

projects that have already been funded that are being held up by regulations." the jobs council says it will work with the administration to try and get the project moving. let me repeat that the projects -- quote -- "are being held up by regulations." this comes from the chairman of the president's own jobs council. yet, when some on the other side of the aisle are reminded that the regulations are holding back job creation they recoil in disbelief. if there are ten large-scale infrastructure projects ready to go and are only being held up by regulatory review lag, i urge the president to act -- quote -- "right now." to get those projects underway in the interest of job creation. make one fewer campaign appearance and use that time to expedite regulatory review and get those projects going if, as should be the case, he believes that job creation is more

important than politics and wishes to act on that belief. we've also heard the president remarking on how from a global competitiveness perspective the u.s. should borrow more today and spend on what he generically calls -- quote -- "infrastructure" which as it turns out can be anything from painting a traod lending out money -- to lending out money to solar panel makers. the president decided a set of global rankings on infrastructure from the world economic forum's global competitiveness report. the president seemed to read the report and its ranking of the u.s. as 23rd out of 139 countries for transportation infrastructure competitiveness as a call for more spending on whatever it is he thinks of as infrastructure. it appears, however, that he did not read the report in its entirety. if he did, he would have noticed that the ranking is for only one of nine factors in the report's overall infrastructure

assessment. more importantly, if he had read the report, he would have noticed the overriding area identified as the weakest one for the u.s. in terms of eroding our global competitiveness. to quote the report directly -- quote -- "a lack of macroeconomic stability continues to be the united states greatest area of weakness, ranked 87th, prior to the crisis the united states had been building up large macroeconomic imbalances with repeated fiscal deficits leading the burgeoning levels of public indebtedness. this has been exacerbated by significant stimulus spending. in this context it is clear mapping out a clear exit strategy would be an important step in the country's competitiveness." there you have it. the report that the president data mine to support stimulus

quite clearly says that declining global u.s. competitiveness has come from fiscal deficits exacerbated by fiscal spending. that means reining in runaway debt-fueled spending. not more spending. before turning to the legislative process on the bill before us, let me post a trail mark for our deliberations. the currency bill we are considering includes reliance on exchange rate models used by the international monetary fund. those models allow for macroeconomic effects on currency evaluations of fundamental changes in policies of trade partner countries. for example, if the united states engages in fundamental tax reform, that would lead to improved growth and reduced deficits and debt. the models considered in the legislation before us have the ability to capture those effects. the marker i wish to set here is

a reminder that we should be similarly so inclined to use economic models that allow for macroeconomic effects of policy changes when we choose to make fundamental changes to tax and spending policies. we should be as willing to have our budget scorekeepers use economic models that allow for long-run growth and macroeconomic effects of fundamental tax and spending reform policies as we seem to be here in this legislation to use models that incorporate such effects when evaluating currency alignments. it is good to use economic models that allow for an accounting of growth effects here than it should be good elsewhere. we have the need to process the currency bill before us. the bill garnered bipartisan support. in the interest of promoting a truly bipartisan effort which the american people would love to see, it is my hope that there will be balance in amendments that are allowed to be

considered. this bill has sound objectives, but it is not perfect. i believe that amendments from both sides of the aisle can improve the final product and, as i mentioned earlier, i have an amendment that i believe will improve this bill significantly and help us devise a long-term approach to dealing with currency misalignment. i hope there will be an opportunity for it and others to be considered. i thoep they're not -- i hope they're not going to lock up the tree again, which is the standard practice around here, by the majority. this bill is an important bill and we ought to be able to amend it with important amendments. the overriding objective of the legislation, job creation, is shared by republicans and democrats alike. therefore, it is my hope that amendments from my side of the aisle designed to improve job growth today and in the future will be duly considered, allowed and duly debated. now, mr. president, i look forward to consideration of the

currency bill before us and a robust bipartisan process which includes consideration of amendments from both sides to promote job creation. as i've said, our nation faces a crisis of unemployment and joblessness that is filled with pain today and threatens erosion of human capital and skills which will negatively impact families in the overall economy for years and years to follow. let us not have politics and special interests dictate what we consider to promote job creation and economic growth. american workers and families, many of them struggling and in pain, cannot wait until the next presidential election is resolved for the federal government to act to promote job creation. mr. president, i suggest the absence of a quorum. the presiding officer: the clerk will call the roll.

quorum call: the presiding officer: the senator from new york. mr. schumer: i know our time expires shortly, and senator hatch -- the presiding officer: the senate is in a quorum call. mr. schumer: i ask unanimous consent the quorum call be dispensed with. the presiding officer: without objection. mr. schumer: i'd like to speak on two other subjects until senator leahy arrives. first i rise in support of a bill that i'll be introducing along with senators leahy, gillibrand, franken and klobuchar, the bill which the senate is also passing today by unanimous consent is truly unique because it accomplishes three incredibly important objectives at the same time. it ensures that approximately

5,600 disabled refugees will not lose critical life-sustaining benefits that is their only safety net, protecting them from homelessness, illness and other effects of extreme poverty. some of the disabled refugees this bill helps are people who aided american troops overseas in aircraft or afghanistan and -- in iraq or afghanistan. others are victims of torture or human trafficking whose injuries are so severe that they're now unable to sustain themselves without these benefits. the bill continues the bush administration policy of making sure that this vulnerable group does not lose their benefits, but unlike past bills the second key fact about this bill is that it's fully paid for. it's paid for by imposing a $30 fee on individuals applying to enter the country through the diversity visa lottery program. each year hundreds of thousands of people apply to be one of the 50,000 individuals allowed to emigrate to the united states, and the program has had great success. i've been supportive of it.

and it's also enriched the american fabric with immigrants from countries not traditionally represented in the immigrant pool. but unfortunately, because applying for a lottery ticket has been traditionally free, the program has recently been compromised by third parties filing applications on behalf of unknowing foreign nationals who then turn around and try to extort money from these nationals if the ticket turns out to be a winning ticket. that's really wrong and unfair. the state department has told us that by charging this 30-dollar fee, we'll eliminate this misconduct. so it's a win-win. we get some money to pay for these refugees, which we all have admitted should be here, many have helped us in iraq and afghanistan. and at the same time doesn't cost us a nickel and eliminates a scam that involves a very worthy program, the diversity visas. finally, the third great thing about this bill is that by setting the fee at $30, the c.b.o. projects it will actually

reduce our deficit by $24 million. so it will help in a small way reduce the deficit. the bill hits the trifecta. it helps a small group of the most vulnerable and needy individuals who we have not abandoned. it virtually eliminates misconduct in the diversity visa program, and it reduces the federal deficit. because it's a win-win-win for all sides, i ask that my colleagues in the house take up and pass this bill immediately. the benefits for these folks already expired on october 1, and if we don't act soon, we won't be able to repair the irreparable harm that will be done to these most vulnerable individuals. i want to thank both my -- my sponsors and chairman and ranking members of the relevant committees governing this bill, senators leahy, grassley, baucus, hatch, conrad, sessions and cornyn, for allowing the bill to pass. i'd also like to thank senator coburn for working with me in allowing this bill to pass and address his concerns to make the bill better. we have done something very good

today, and i thank all of my colleagues who have joined in the unanimous consent resolution that will pass shortly. i hope the house does the same. mr. president, i -- since we're awaiting senator leahy, i'll continue as if in morning business, and on a floor statement on mr. william f.kuntz, ii, he is nominee to the u.s. district court for the eastern district of new york. i want to describe to my colleagues the extraordinary qualifications of dr. kuntz, the nominee to the bench of the eastern district who we will hopefully confirm later today. dr. kuntz has exactly the skills, temperament and experience to be a perfect addition to one of the bussiest u.s. district courts in the country. dr. kuntz is currently a partner in the new york office of baker and hostettler. he is a native of harlem. he grew up in what was then called the polo ground projects

and went to high school at fordham prep in the south bronx. he earned his undergraduate degree from harvard university followed by a master's degree in history and a ph.d. in american legal history, all from harvard. i hope no one will hold that against him, and all within 11 years of arriving in cambridge from harlem. what an amazing man. what an american dream story. i would venture that throughout this country, dr. kuntz has few peers in terms of education and training, but he didn't use his degrees to go on and teach and write, a valuable career path to be sure, but possibly not one that would have put his skills as an advocate and his commitment to the people of new york to their highest and best use. instead, dr. kuntz went on to log 33 years of litigation experience in some of new york city's finest law firms, and most impressive to me, he served for 23 years as commissioner on the city civilian complaint review board. this independent agency oversees

the investigation of citizens' claims of misconduct by new york city police officers. by all accounts, dr. kuntz staked out an admirable middle ground informed by hard investigative work and careful consideration of all of the 5,000 cases that came before the board every year, and when my legal committee looked into his work there, he was praised by both the police side and those who brought cases before the board in that kind of tempestuous situation, that's rare indeed. his commitment to public service is long and impressive. he served in leadership positions on the legal aid society, the new york bar and the p.m.i. among others. i note that dr. kuntz will be filling an emergency vacancy in the eastern district of new york, a court that adjudicates a large share of critical cases such as terrorism and terrorism financing, organized crime and mortgage fraud. dr. kuntz is sorely needed and

more than up to the task. so i look forward to dr. kuntz' service on the bench and congratulate him and his family. with that, mr. president, i yield the floor. i notice the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

mr. leahy: mr. president. the presiding officer: the senator from vermont. mr. leahy: i ask unanimous consent the call of the quorum be dispensed with. the presiding officer: without objection. the senate will proceed to executive session to consider the following nominations which the clerk will report. the clerk: nominations, the

judiciary, henry f. floyd of south carolina to be united states circuit judge. nannette brown of louisiana to be united states district judge. nancy torresen of maine to be united states district judge. william francis kuntz, ii of new york to be united states district judge. marina garcia marmolejo of texas to be united states district judge. jennifer guerin zipps of arizona to be united states district judge. the presiding officer: under the previous order, there will be one hour for debate with respect to the nominations with the time equally divided in the usual form. mr. leahy: and, mr. president, that would bring us to 20 minutes to 6:00, and i think there was probably an attempt to vote at 5:30, so i would ask consent that the time be still

divided in the regular way but the votes begin at 5:30. the presiding officer: without objection. mr. leahy: mr. president, today's consideration of six qualified consensus judicial nominations is welcome. it's all too rare. i commend majority leader reid for pressing for senate votes on all 27 of the judicial nominees fully considered by the senate judiciary committee and waiting final action by the senate. we have a judicial vacancy rate that stands at 11%. we have 95 vacancies in federal courts around the country. we have to build on today's efforts. the regular consideration of nominations without needless delay. i was talking the other day with bruce cohen, who is the chief of staff of the senate judiciary committee, chief counsel, and somebody who has had a great deal of experience working with

different senators, and we were talking about the fact that it has never been -- that there has never been anything like this. we usually see whether it's a republican president, democratic president, republican-controlled senate, democratic-controlled senate, when nominees go through the senate judiciary committee unanimously, supported by the senators from their home states, they usually within a few days during wrapup voice vote it through. now, once in a while, whoever is leader may need a -- a vote on a monday afternoon, so the next monday afternoon one will be voted on. of course it's always 100-0. we have people go through unanimously supported by republican and democratic senators, and they wait month after month after month. i hope that we can get away from that. i hope for the integrity of our

judicial system that we can get away from that, but also just think of the personal account that takes on the people who have been nominated. if you're a lawyer, you're a distinguished lawyer, you're nominated for the federal bench, everybody is going to congratulate you. isn't this wonderful. and then the rest of the law firm is kind of looking at you and saying are you going to leave now? when are you going to leave? because your life is put on hold. it's probably going to take -- you're probably going to take a significant cut in salary anyway, but you can't -- you can't take on new clients. so anyway, i ask -- i ask my full statement be included in the record, and i hope this is probably an indication that we'll finally get moving. the presiding officer: without objection, the statement will be submitted for the record.

mr. leahy: mr. president, i -- as i use my time, my allotted time now as if in morning business. i want to talk about the devastating flooding in vermont, and also our recovery. last week, my wife and i probably drove 400 miles around the state of vermont, inside the state. we're a small state, and the distinguished presiding officer knows how in small states you can go from one end to the other fairly quickly. we crisscrossed the state over a period of a little over a week. a lot of the time, just the two of us in the car. we would just drive around and go and say thank you to volunteers. some of the things we saw were so touching. people who had lost everything were helping others, and vice versa. the spirit is wonderful, but the

reality is in our little state, the state where both my wife and i were born has been hurt in a way that we have not seen in our lifetime. i have talked about these inspiring actions of vermonters. one of the things, we saw some of the worst damage caused by the storms have been to the houses, the mobile homes, the apartments where vermonters have built their lives and made their homes, they have become part of the communities, their kids go to school, they are the fabric of the community. we have seen entire mobile home developments washed away. where homes once stood now lies a path of damage and destruction and heartbreak. look at the horrific -- look at the horrific flooding we have right here.

roads suddenly where there were no roads. look at the forefront of this picture. house collapsed in on itself. children's toys, what might have been a playground at one time now devastated. i had people tell me we lost everything, and then in tears we lost our wedding album, we lost the pictures of our children when they graduated from high school. we lost the pictures of their baptism or their bar mitzvah. i mean it just tears you apart because they've lost not only their homes, they've lost part of their memories.

i want to commend my staff both here in washington and in vermont because they have worked sometimes literally around the clock, they have worked weekends, evenings, days to help. and they've seen the -- firsthand the ruin and the pain delivered by this disaster. they've seen it with their eyes but they've seen it in the tearful eyes of families around the state. over the sounds of generators powering sump pumps and heavy commitment removing debris we've had countless conversations with people as they stared at foundations, empty foundations that once held their homes. as they dug toxic muck out of their basements and shops, as volunteers helped pulling down wet dry wall in a race against the onset of mold. most of these conversations begin with memories of fast-rising water, but also

death-defying rescues. in northfield, northfield, a town just a few miles from where i live, dozens of homes along the peaceful dog river were flooded with as much as six feet of water. one homeowner who sustained the rising waters only by canoe fears the insurance and fema assistance will not be enough to help him restore his home. his home. his home, which is part of his life. and like many of the residences water street naibs neighborhood, he's left wondering if rebuilding is possible or even worth the effort. in brattleboro, mr. president, that's in the southeast corner of our state along the connecticut river, the connecticut river is the boundary between vermont and new hampshire. the brattleboro housing authority lost 60 units of housing. they put families in hotels or

on their friends' couches. spread throughout the region. as the housing authority tries desperately to fix what is lost. i saw a lot of that damage. i went there with governor shulman, and the head of our vermont national guard, i saw it. and roxbury, beautiful town of roxbury, one town along a peaceful brook that is usually one foot wide was forced to the roof of their house as floodwaters rose and the brook became almost instantly a raging rapid more than 20 feet across, six feet deep. in ducksbury, the next town over from mine, in berlin, and nearly a dozen other towns, mobile home parks quickly became submerged. these homes are especially vulnerable to flood damage.

they're easily destroyed by a few feet of water. in areas where they've never seen a few feet of water, and suddenly in seconds it's there. last week in woodstock i visited a mobile home park where on the night of the flood the entire community crowded onto a small mound in the middle of the park waiting rescue as they watched their homes being destroyed. my son and i stood on that mound it's a beautiful fall day when we stood there and we looked down but you could see everything that had been torn up. you could see the gowns, you could see the damage. and i wonder how can somebody stand there, not only see their houses destroyed, watch that water come up and if it comes up just a little bit further, you're going to die, too. just one week after the flooding, fema estimated that more than 900 homes in vermont had suffered damage.

today that number continues to grow. families who found safety and comfort in their homes before irene now find themselves living in temporary homes and shelters and hotels. and winter is quickly, quietly approaching. our small state's ability to build new homes depends greatly on support from federal safety net programs like the emergency community development block grant funding that i was proud to support and included in the transportation-h.u.d. appropriations bill. this emergency funding is the first step in addressing the urgent housing needs of states like vermont that have been stuck lie natural disasters. we know much more will be needed to help our communities and businesses get back on their feet. housing authorities need section 8 choice vouchers. these sound just like numbers to people.

they are life to the people who depend upon them. they need to provide relief to low-income renters permanently displaced, need the flexibility to make use of the few available units of government-subsidized housing without the burden of string ept eligibility requirements. i'm proud in is senate on the appropriations committee over the past several weeks working so hard, we've been able to make prompt, significant, and bipartisan strides towards addressing the emerging disaster recovery need in states like vermont and new jersey and north carolina. i've seen 48 states in the union faced emergency disaster needs this year. mr. president, i remember the stories my parents and my grandparents told me of long before i was born -- of

flooding long before i was born in vermont. i'm 71 years old. i've not seen damage and destruction of this magnitude in vermont in my lifetime. vermont and other states were hit by irene and are stretched to the limit right now. just as the victims of past disasters throughout the country were able to rely on their fellow americans' help in their time of need, including vermont's help, so should vermonters be able to count on help when they need it most. and it is regrettable, it is disappointing -- actually it's incomprehensible that some in congress continue to insist that assistance can only come at the cost of other federal programs and services relied upon by the american people, to be taken out of education, do we take it out of medical research, do we take it out of job creation?

do we rob peter to pay paul. now, some of these same voices have had no problem with spending hundreds of billions of borrowed dollars on wars waged overseas and rebuilding communities in iraq and afghanistan. they're borrow the money to rebuild roads and villages and homes in iraq and afghanistan, but they're going to apply a different standard to emergency disaster recovery efforts desperately needed by americans for americans here at home in america. it's alice in wonderland. an old line vermonter said to me, he said you know, pat, we give them money in iraq and afghanistan to build homes and bridges and roads. and then they blow them up. build them here in america.

we'll take care of them. and we'll use them. you know, i could give a ten-hour speech on the floor on those two sentences sum up from what i've heard from anybody, i don't care what their political background is or anything else in vermont. now is not the time to ask americans to choose between helping victims of a disaster or to fund cancer research or equipment for first responders or job creating programs. we need to come together as a country. we always have in the past to pass an emergency disaster bill that provides relief to our states in a time of need. now, the senate has answered the call by passing critical disaster relief legislation. it's time for the house to do the same. when victims of hurricane irene start rebuilding their homes, as they rebuild their homes, mr. president, they rebuild their lives.

as they rebuild their lives, they rebuild our communities. as they rebuild our communities, they rebuild our state. and we are a part of the united states of america. mr. president, i'd yield the floor and i would suggest the absence of a quorum and i ask consent the time be equally divided. the presiding officer: without objection. the clerk will call the roll. quorum call:

a senator: mr. president. the presiding officer: the senator from iowa. mr. grassley: i ask that the calling of the quorum be will confirm six more of the president's judicial nominees. four of these vacancies have been deemed to be judicial emergencies. with these votes, we will have confirmed over 44% of the president's judicial nominees that have been submitted by the president during this congress, and 66% of all of his judicial nominees. as i have stated, the confirmation of executive and judicial appointments is one of the highest responsibilities of

the senate. it is a duty that we all take seriously. it is not, as some have suggested, a pro forma process. we're not here to merely rubber stamp the president's nominees. sometimes this process takes a little time. it is the senate's right and duty to review thoroughly the records, qualifications, and temperament of nominees. above all, the process is to be treated with respect and with dignity. this is important for the nominees, for the senate, and for public confidence in our constitutional process. so i was disturbed to read recent news reports regarding what was described as an induction ceremony in the northern district of california for judge edward chan. i believe at this event judge chan showed disrespect to the