of drugs that are in shortage, and prohibit the distribution of false information. it gives the f.t.c. the authority to assess penalties for these actions, and i thank my colleagues on the commerce committee, chairman rockefeller, and also i thank senator schumer for his leadership because he's shown a similar commitment to addressing these issues.  our doctors and our health care providers deserve some recourse from market manipulation. the gray market must be stopped and the f.t.c. must immediately establish a reporting mechanism for price gougers and gray market profiteers. these measures are a beginning. the notification provision now in the bill is a start. i thank, again, chairman harkin, ranking member enzi for their leadership and the f.d.a. for

its cooperation. the work cannot stop with this bill. drug shortages are unacceptable and inexcusable. and the people of america, if they are aware of it, will demand that we heighten the fight toward a comprehensive solution. thank you, mr. president, and i yield the floor. a senator: mr. president? the presiding officer: the senator from louisiana. mr. vitter: thank you, mr. president. mr. president, senator sessions and i come to the senate floor today to discuss the child tax credit integrity preservation act, a bill i introduced last year to introduce a real problem with i.r.s. enforcement, allowing illegal aliens to access the additional child tax credit. mr. president, the reality is because of this enforcement problem, because of this loophole in terms of how the child tax credit is enforced,

illegal aliens who pay no taxes, who are not entitled to this benefit, to this check from the government, receive $4.2 billion in 2010 alone, checks from the government through the child tax credit act. there have been several studies under this president obama administration that say this is ridiculous, this is unintended, we need to stop this. so i'm proposing we do, we move forward in a simple bipartisan, commonsense way to stop it. let me briefly note some of those studies. march 2009, the treasury department said -- quote -- "as it now stands, the payment of federal funds through this tax benefit appears to provide an additional incentive for aliens to enter, reside and work in the united states without authorization, which contradicts

federal law and policy to remove such incentives." close quote. in july, 2011, again the treasury department, through its inspector general, issued a report that was actually entitled -- quote -- "individuals who are not authorized to work in the united states were paid $4.2 billion in refundable credits." close quote. so again, under this administration, the treasury department, the i.r.s. underscore that this is a huge problem to the tune of $4.2 billion every year. and so, mr. president, i urge all of us to come together in a straightforward, commonsense, bipartisan way to fix this problem. the fix is simple and it's clear. the i.r.s., the treasury department has told us we simply need to mandate that folks

applying for the credit use valid social security numbers. that will cut off the fraud. that will cut off $4.2 billion going improperly to illegal alien families. it will not cut off the benefit going to anyone who deserves it under the law. and so, mr. president, with that, i ask unanimous consent that the committee on finance be discharged from further consideration of s. 577, the child tax credit integrity preservation act, and the senate proceed to its immediate consideration, that the bill be read a third time and passed, the motion to reconsider be laid on the table, and any statements relating to the measure appear at the appropriate place in the record as if read. the presiding officer: is there objection? mr. reid: mr. president? the presiding officer: the majority leader. mr. reid: reserving the right to object. i, first of all, want to express

my appreciation to the senator from louisiana and the senator from alabama for their courtesy. they're going to talk a lot longer than what he's talked now. and in recognizing there would be a good chance that i would object to their request, they have agreed to allow me to say a few words before they finish what they want to say here on the senate floor. so i appreciate that courtesy very much. i do have some other things i need to work on. mr. president, the vitter-sessions legislation literally takes a sledgehammer to a problem that deserves some very fine tuning scalpel. there are news reports that have suggested that some have claimed the child tax credit for children who actually live outside the united states. the tax code is very clear that a child tax credit is not available for children living

outside the united states. very clear. and if in fact someone is doing that and those filers and taxpayers are committing fraud on the people of this country. and that's something, if they are doing that and there's a loophole that's existing, we need to close that loophole. chairman baucus has already had his staff working with the i.r.s. to determine if its procedures are strong enough to stop such fraud. we believe they are, but if they're not, it's up to us -- congress -- to plug any loopholes that may exist. the vitter-sessions legislation, however, eliminates the child tax credit for filers who are fully complying with the law. that isn't a good result. in fact, this legislation that's proposed here fails to address the issue of the child tax credit being claimed for children not living in the united states. the problem is not solved by this legislation.

and legislation goes well beyond what's necessary to stop fraud in the child tax credit program, and, therefore, i object to the consent request. the presiding officer: objection is heard. the senator from louisiana. mr. vitter: mr. president, before the distinguished majority leader has to leave, i would just ask through the chair so that we can get some clarification and hopefully come to some consensus, is he suggesting that folks in the country illegally, illegal aliens in the country should continue to receive the credit and, is he suggesting that citizens who happen to live outside the country who qualify for the credit shouldn't get it? it seems to me the problem is illegal aliens receiving the credit, wherever they are physically. not people outside the country receiving the credit, some of

whom qualify for the credit. if i could bring that point up through the chair. mr. reid: mr. president, without fully debating this subject, and perhaps know more about it than i do, but what i do know is we want to make sure that any children who are here who are american citizens who are entitled to this, they get the benefits if they're american citizens. mr. vitter: well, thank you. the presiding officer: the senator from louisiana. mr. vitter: thank you for that clarification, i would sail through the chair. we have the same goal in mind exactly, and i believe this approach of the vitter bill -- the house has already passed this approach recently in its budget outline, actually accomplishes that. by requiring a valid social security number, we allow everyone who truly qualifies for the credit to get it. and we stop it from going to

illegal alien families who do not deserve the credit under the law. and i'd invite my distinguished colleague from alabama to add to the discussion. mr. sessions: mr. president? the presiding officer: the senator from alabama. mr. sessions: i do thank the chair and appreciate the insight that the majority leader provided. we'll look at that and see where we stand on it. but i would urge that we do not need to wait a great deal of time for this to be fixed. the inspector general of the united states treasury department started raising this informally in 2005. the issue came up in 2007 from individuals in the treasury department who thought something wrong was occurring. so the inspector did a report, and he calls on us to fix it. in fact, he said in his report -- quote -- "we continue to believe the legislation is

needed to ensure compliance with both laws." close quote. i would say that that is what we need to do. the house has acted, and we should act. $4 billion a year is a great deal of money. it's about $10 million a day that's going out of the country to individuals who should not be receiving it. according to the inspector general report, the amount of the child tax credit -- and as senator vitter said, this isn't a tax deduction. this is a $1,000 per child tax credit that you have for people within the united states who work, would have worked lawfully, who have children. and they get a check. if they owe no income tax at all and a substantial percentage of the people who work in america don't end up paying income tax,

but you still get a check from uncle sam for $1,000 per child. it was a policy i supported because over the years the families had not gained the kind of deductible advantage that had been done 30 years ago when people had children. and it sort of leveled the playing field in helping working families raise children in a decent environment. it is a policy i like but it is not for somebody illegally here who has children in some foreign country. that's not what it's about. and it's $4 billion, and it surged. in 2005 the inspector general noted that the i.r.s. pays out to these i-10 filers, $924 million in 2005. in 2006, it was $1.3 billion.

in 2007, $1.7 billion. in 2008, $2.1 billion. 2009, $2.9 billion. and from 2009, senator vitter, when you first -- 2009 to 2010, it went from $2.9 to $4.2. it's been surging every year. i would say as a matter of protecting the treasury of the united states from abuse, the i.g. says we need legislation, you've drafted, i think, legislation that will do the job precisely as it should. don't you think congress should not be waiting around here another year, but it's something the house has already passed? and if we pass, it becomes law in a matter of days perhaps. mr. vitter: mr. president?

the presiding officer: the senator from louisiana. mr. vitter: mr. president, if i could respond through the chair, i absolutely agree with the senator from alabama. mr. president, too often folks in washington want to make things overly complicated. some things in this world, some things being debated in the congress are complicated. other things are not. they're just made a whole lot more complicated than they need to be made, and this is one of those. all we're saying is folks who qualify for this benefit under the law should get it. but folks who don't qualify including illegal alien families should not get it. the law is clear on that what we have is an enforcement problem. we have the obama administration through the treasury department agreeing this is an enforcement problem and this bill is the legitimate and proper solution.

again, march 2009, the treasury said -- quote -- "as it now stands the payment of federal funds through this tax benefit appears to provide an additional incentive for aliens to enter, reside and work in the u.s. without authorization. that means it's a magnet to draw more illegal crossings into the country. again, july 27, the treasury inspector general had a whole report, and the title was -- quote -- "individuals who were not authorized to work in the united states were paid $4.2 billion in refundable credits." that inspector general said that what we need is a fix legislation just like this. in fact, this is what we do with regard to the earned-income tax credit. we require for that separate tax credit a valid social security number. and we're simply applying that

valid fiction to this different -- valid fix to this different tax credit. again, let's not make a pretty straightforward situation difficult. let's fix a glaring problem. and as the senator from alabama has said, it's a $4.2 billion a year problem. we come to the floor every day to talk about soaring deficits and debt, to talk about impending cuts in defense in other areas, and yet we have this glaring $4.2 billion savings that we're not taking advantage of. the house has acted. the house recently acted to pass exactly this provision. let's act in a bipartisan, commonsense way in the senate and tell the american people we're going to stop wasting $4.2 billion a year for this completely unauthorized purpose. mr. sessions: mr. president?

the presiding officer: the senator from alabama. mr. sessions: i would point out to my colleagues how much $4 billion is. it's a matter that we deal with in a regular basis around here. it's a number that's come up civil times recently -- several times recently. for example, we had a shortfall in our plans to fund the federal highway program, a deeply disappointing event that we couldn't get that bill passed. it started out as a $4 billion shortfall. they worked that number down but they're still not fully paid for. we lack just a few billion dollars to pay for the bill. it hasn't been passed. the student loan fix, where the interest rates would be dropped. if i'm not mistaken, that was $4 billion needed to reduce interest rates on stiewfnlt -- on students.

$4 billion going to the i.g. is going out of our country illegally every year that we could save. the president spent a lot of time traveling around the country saying we should raise taxes on the rich and we should pass the buffett tax. and he had a proposal for the buffett tax. how much would the buffett tax raise? $4 billion. that's how much this illegal event occurs. frankly, i'm a little disappointed that the treasury department officials and the administration itself hasn't seized immediately upon this loophole that's costing the taxpayers large amounts of money and responded themselves, sent legislation over and ask us to pass it. why aren't they asking us to pass it, to begin with? well, the inspector general, who's independent quasi- -- gets

some little independence from the department of treasury but, in fact, he's an employee of the department of the treasury. he says we need this. quote the report -- quote -- "clarification in the law is needed to address whether or not refundable tax credit such as actc may be paid to those who are not authorized to work in the united states." well, of course they ought not to be getting a check from the united states taxpayer if they're not authorized to be working here. so as the ranking member on the budget, knowing how tight our budget is, i salute senator vitter not just for doing it this year but he saw this problem last year and attempted to get it passed. and i'm pleased that the house has passed it. i -- i think if we keep working at it, senator vitter, maybe we can get it done, through the senate, remembering that $10 million a day is going out of the country for every day we

fail to act. mr. vitter: vitter: mr. preside? the presiding officer: the senator from louisiana. mr. vitter: mr. president, i want to thank my colleague from alabama very much for his leadership on the budget committee and his leadership on issues like this. i want to encourage the distinguished majority leader to look at the actual details of the problem and this legislation. when he does, he'll see that this legislation is very finely tuned to the actual problem, and it is an outrageous problem. mr. president, there was quite a bit of media attention on this abuse in the last several months. a lot of it came out of indiana and a tax preparer there brought cases in indiana, said he got no response from the i.r.s. when he tried to report completely fraudulent returns using fake income and documents. he pointed to a number of actual tax forms in which illegal aliens were exploiting this.

and he said -- quote -- "i can bring out stacks and stacks. it's just so easy, it's ridiculous." and an illegal alien who was actually interviewed admitted in another case that his address was used by four other illegal aliens who didn't even live there. all told, they claimed 20 children were living in one trailer and they received checks from the government through this program totaling over $29,000. only one child was ever observed at that mobile. 20 other children live in mexico , have never even visited the u.s. again, mr. president, let's not make a simple fix overly complicated, because it's not. this is an outrageous abuse. the obama administration treasury department has said of of -- has said so. they have endorsed this fix, the

house has passed this fix. let's us in the senate passion this fix on a -- senate pass this fix on a bipartisan basis and save the american taxpayer $4.2 billion each and every year. with that, mr. president, i yield the floor. mr. sessions: mr. president? the presiding officer: the senator from alabama. mr. sessions: just to conclude, i think the american people are unhappy with their leaders. they feel like that the money that they've sent here is not being well spent, not being watched closely enough. we have a big judicial conference for the second year 2010, the second time, to go -- to spend a million dollars on a resort conference in maui. we have the solyndra loans going out to cronies that are not being paid back in any way. we have the general service administration having a big party out at las vegas with hot tubs and -- and magicians and so

forth. we've got no budget for three consecutive years in the united states senate. and what are we hearing from many of our leaders here in washington? well, we've got a problem, american people, we've got too big a debt; send us more money. send more money. we're not -- we don't have enough. we're borrowing 40 cents of every dollar we spend. send more money. i think the american people are tired of hearing that. i think they have a right to be tired of hearing that. until this country is willing to face up to save $10 million a day on this kind of manipulation that's been going on since 2007 at least and been raised by the inspector general since 2009, until those kind of things are stopped, i don't think they should send any more money to washington. we need -- we need to honor the money they're spending. so, mr. president, i thank the

chair and would yield the floor. a senator: mr. president? the presiding officer: the senator from massachusetts. mr. brown: thank you, mr. president. i also ask consent that my military fellow, major jay rose, be granted floor privileges for the duration of my remarks. the presiding officer: without objection. mr. brown: thank you, mr. president. i rise to speak about an historic air is mean took place place -- ceremony that took place in boston harbor today, the birthplace of the american revolution. that event happened earlier this morning. and this morning, the united states navy named an ar lay burke class guided missile destroyer for retired united states navy captain thomas jerome hunter jr. of concord, massachusetts. the same money took place aboard the oldest commissioned ship -- warship in our united states navy, the u.s.s. constitution. as you know, mr. president, it is a distinct honor for any service member to have a navy vessel commissioned in his or her name. what made the event special

today and extremely rare is that captain hudner is the navy's last living medal of honor recipient from the korean war. as the story you are about to hear shows, no one would be more worthy of this distinction than my friend, tom hunder. tom is a native of fall river, massachusetts. he was a student at phillips exitor academy when the japanese attacked pearl harbor. as the leader on his school's athletic fields and in his student government, naturally he responded to the call of arms. and although world war ii ended before his commissioning at the naval academy in annapolis, hudner began a storied navy career that would earn him our nation's highest military honor. during his first few years in the navy, hudner served as a communications officer aboard various warships before being accepted to the navy's flight school in corpus christi, texas. after earning his wings of gold, he became one of the fighting

swordsmen of strike fighter squadron 32 aboard the aircraft carrier u.s.s. layette. just a few years after the racial integration of the u.s. military, hudner began flying alongside a young ensign names jesse leroy brown, the navy's first black pilot. brown was born and raised in a segregated deep south town of hattiesburying, mississippi, a world away from hudner hometown of fall river, massachusetts. in the summer of 1950, less than a year after flight school, north korean communist forces invaded the republic of korea. within months, president truman ordered the yett into action off the coast of korea when hudner and jesse brown immediately began flying recon jens and attack sorties against communist positions. not long after their squadron joined the fight, chinese forces invaded the korean peninsula and threatened to overrun u.s. positions. there are no routine missions in

wartime, especially when flying close air support over enemy positions. on the afternoon of december 4, 1950, when hudner and brown were on a mission to destroy enemy targets near the chosen reservoir, about an hour into the mission, brown's corsair was hit by enemy fire and began to lose fuel and he was forced to crash-land his aircraft into a snowy mountainside. the events that transpired over the next few hours became enshrined in the history of naval aviation. despite exposure to hostile ground fire, hudner continued to make low passes over brown, who was trapped in the wreckage of his destroyed aircraft. when hudner saw that his wing man's plane was burning, he deliberately crash-landed his own aircraft, risking his life. though injured in the violent land, he ran to rescue brown. you see, mr. president, for tom hudner, never leaving a wing man is more than just a phrase he learned in flight training. it was a covenant. a short time later, a rescue helicopter pilot arrived and

both he and hudner tried in vain to free brown from the wreckage. yet with night falling and ensign brown lapsing in and out of consciousness, hudn was finally forced to evacuate the bitter cold crash site. brown's final words to hudner were to tell his wife daze that he loved -- wife daisy that he loved her. he would do that, in fact, in person. on april 13, 1951, daisy pearl brown was in the audience when president harry s. truman presented thomas hudner with the medal of honor for his heroic attempt to save ensign brown. over the next two decades, hudner continued to serve with distinction in the united states navy. in addition to flying many of the navy's newest jet fighters, his career would take him from various ships and air bases where he served in positions of increasing responsibility, including as executive officer of the u.s.s. kitty hawk during the vietnam war. tom and his wife -- tom hudner

and brown's wife daisy remained friends. their lives intertwined by events decades earlier on a snowy mountainside on the other side of the globe. in fact, the two friends would stand together at another ceremony some 22 years later when the u.s. navy commissioned the first american warship in honor of an african-american, the u.s.s. jesse l. brown. hudner retired from the u.s. navy at the rank of calf -- captain in 19783 and while his day-to-day service in the military weaned, he would continue to serve his fellow veterans through the u.s.o. and various veterans' organizations. in fact, for most of the 1990's, hudner served as the commissioner of the massachusetts department of veterans affairs. today, the newly commissioned u.s.s. thomas hudner will serve as a living legacy to heroism and service. think about it for a moment. when a sailor or a marine is assigned to this ship, they'll proudly tell their family and friends about both hudner and brown.

when the hudner makes a port call, those in the communities it visits will see the ship in port and meet scores of new crew members with u.s.s. thomas hudner stitched on their shoulder. and when citizens around the world learn about captain hudner's specific act that the navy has described as conspicuous, gallantry at the risk of his life above and beyond the call of duty, they will begin to understand what uncommon valor truly is. tom hudner's story will serve as an inspiration to a future generations of americans. mr. president, please allow me to thank my friend, captain tom hudner, for his lifetime of exceptional service to our nation. and his dedication to his fellow veterans. i ask you and our nation to join me in wishing him and his wife, georgia, all the very best in the years ahead. thank you, mr. president.

and i suggest the absence of a quorum. snoo mr. brown: mr. brown: i withdraw that request. i yield the floor. the presiding officer: under the previous offered, the senate stands in recess until 2:15 p.m. >> we recently spoke with a capitol hill reporter.

emily etheridge with congressional quarterly. what are the key issues ahead as the senate debates the food and drug administration bill. >> already included in a manager's amendment we'll see on the floor. i it is about a national drug tracing system allow manufacturers to trace drugs with a serial number as they pass through the system. we'll see drug importation and pda more power to investigate things and give employees whistle-blower protections. >> what is the overall purpose of this fda reauthorization? >> purpose of the user fee program is to give the fda more money to conduct its reviews of products like drugs and medical devices to get money from the companies who are applying to get their drugs or products approved. the fda says they really need this money. they count on it to be able to do the things they do to approve these news products. >> why don't we dig a little deeper in some of the amendments we're likely to see in debate this week.

>> well, we are definitely going to see one from senator john mccain. that is on importing lower cost prescription drugs from canada. that has been a long-time goal of his. he has democratic senator sherrod brown from ohio as a cosponsor now. that is something a lot of senators support. it is a little controversial. i don't expect it will be adopted onto this bill. we have some other amendments from bernie sanders has had some amendments on clinical trials. we're going to see a lot of different things pop up. we might see flood insurance program from david vitter come up on the bill which doesn't have anything to do with the fda but something he is trying to get passed. >> the cq article writes about the issue of regulation of sunscreen. what can you tell us about that. >> some of the democratic senators want the fda to have stronger labeling restrictions on sun skeen as especially it is summer and hope some of us get on the beach and use these products. they want the fda to have tighter restrictions how the

sunscreen products can be marketed and labeled. >> how have fda officials responded to senate bill? >> fda officials very much want the senate bill to come through. they have worked out agreements with the industry. they have worked out agreements with lawmakers. they been working on this bill for two years now. they want the agreement to get through as quickly as possible. the authorization doesn't expire until september 30th but they're trying to get this done as quickly as possible so there is no doubt whatsoever that this will be done and fda will continue to receive its funding. >> we're seeing the house bill being developed significantly different from the senate bill? >> there are only a few places where they're different. overall very similar. there will probably have to be a conference committee iron out the differences. we've seen issues for example with the antibiotic it is language and development of new antibiotic that is different between the two bills but it is not too far apart. there is nothing incredibly different that would keep it from being able to come to a final agreement. >> when do you expect the

senate to finish work on its bill? >> i think the bill will be done on the senate this week hope by thursday, possibly friday but they're off on recess next week. definitely before then they want to wrap it up and get it over with. house will take up the bill next week when it comes back from recess. >> reporting on the fda bill in the senate. emily etheridge joining us from capitol hill. thanks for being with us. >> thank you. >> to learn more about the senators you psion the floor today c-span's congressional dreblg tri, a complete guide to the 112th congress. inside you will find contact and biographical information as well as committee assignments. you will find out about cabinet members the supreme court and the state's governors. grab a copy for 12.95 plus shipping and handling. order online at c-span.org/shop.

>> the u.s. embassy in kabul says ambassador ryan crocker will be leaving his post this summer. mr. crocker came out of retirement last july to take over as the top u.s. diplomat in afghanistan. no word yet on why he is leaving the post a year ahead of schedule. he is also served as u.s. ambassador to lebanon, pakistan, kuwait and syria. ambassador crocker is currently living in the u.s. where he attended a nato summit in chicago. vice president joe biden goes on the campaign trail today. he will be at keane state college in new hampshire to speak about the president's economic policies. this is vice president biden's fourth trip to the granite state this year. you can see his comments live starting at 1:45 eastern on c-span.

>> right now i want you to take a look around you and think not about where everyone has been but where they are going. the guy in front of you could win an academy award some day. the girl behind you could be a future president of the united states or even better than that, the mayor of new york city. the guy sitting to your right could be a future nobel laureate. okay, maybe not the guy to your right but certainly the one to your left >> about 60 years ago that the first computer was used to predict a presidential election outcome. cbs news use ad univac computer in the 1952 race between republican dwight

eisenhower and democrat adlai stevenson. it accurately predicted eye send how landslide with only 5%. news men didn't believe it because it contradicted the polls. we computers and campaigns from the computer history museum in mountainview, california. it is about an hour ant 15 minutes. >> election night 1952 introduced a new word into the american lexicon. univac when they used it to track the eisenhower-stevenson election. the computer became famous overnight. the mere word univac became synonymous with modern computing in the 1950s as the word google is to modern web searching today. you can see the univac in our revolution exhibition. election nights are the smallest part of how technology drives the modern presidential campaign. we voters are profiled by computers. we're mobilized by tweets.

we're hit up for contributions on facebook. we're mixed and matched and in pools of big data. we have a great panel tonight examining the state of the art in presidential campaigns and social media, 60 years after univac. chris lehane is the partner in partner communications firm in san francisco. chris was special assistant counsel to president clinton and legal communications and political counsel to president and mrs. clinton as first lady. he was also campaign press secretary for the 2000 democratic presidential ticket of al gore and joe lieberman. sarah feinberg is director of policy communications at facebook. sara was previously special assistant to president obama and senior advisor to white house chief of staff rahm emanuel. she's also served as communications director for the house democratic caucus. tucker bound was the national spokesperson and director of rapid response for john mccain's 2008 presidential campaign. in 2010 epserved as deputy campaign manager and

director of communications in meg whitman's campaign for governor of california. he also has served as the western press secretary for the republican national committee. he is at facebook as well, serving as manager of corporate communications. our moderator is richard kudlow, professor emeritus at the harvard business school. richard is the author of seven books on business including an award winning biography of andy grove. richard is also a trustee of the museum and the originator for the idea for tonight's panel. join me welcoming chris, sara, tucker and richard [applause] >> thank you very much, john. so is this mic on? it is. can you hear us? we all managed to get on stage without tripping.

so this is a huge plus. anyway, so, welcome, tucker, sara, and chris. tucker is way down there. sara is, i think should be obvious. and chris is here and i'm richard and because i'm on the board of trustees i get to wear jeans. i actually asked permission and received it. so let me just, i'm an historian by training. say one or two quick words. polling has been around for a long time. if you consider modern statistical technique a technology, the use of the technology of, of statistics in polling really didn't come on board in u.s. presidential campaigns until 1948 and then they did miss. gallup, the polls stopped early because looked like dewey was going to defeat truman easily. that was the generation of the result of a famous "chicago tribune" headline

that says, dewey defeats truman and that was wrong. there was a famous poll back in 1936 by the literary digest said that land done would defeat roosevelt. that was wrong too. the reason that was wrong because they took their poll by telephone and only the republicans were wealthy enough to have phones in 1936. so although the sample was huge, everybody was, and james farley, who was the postmaster general at the time said land done will take maine and vermont and that is it. that is exactly what wound up happening. what we saw here in a lovely clip i think is, an inflection point in the history of politics in the united states and perhaps the world i guess which is the coming of television to politics. it has changed, television broadcasting and the combination of that with computers, with polling, with scientific methods of sampling has changed the way elections are run in this country and has changed the

nature of politics and so we're very, very fortunate to have as guests people who live this life and know this world as i don't personally. i mean, i don't get it. i don't understand why tweeter, like going to change the world. we had a discussion prior to this meeting and i was told that, that if i'm lonely between now and election day all i have to do is move to akron, get a job in a goodyear factory and tweet, you know, i'm a white male and i'm a factory worker here in akron and i just don't know for whom to vote. and if i just did that, i would have friends until election day. then they would all turn their backs on me and that would be the end of it. so i'd like to start off by asking what we were just

discussing in the greenroom actually, here we saw this big inflection point 60 years ago. the world changed with television. your world, the world in which you live and have to predict the unpredictable and deal with the unfair so many times. is the world going to change with, with the realization that we now have facebook, we now have twitter, we now have social media and if so, how is the world going to change? what is going to be, what is different and what's going to be different? so let's, chris, let me ask you to start. then we'll just go, okay? >> first of all, thanks for having us especially with this very august panel and john, thank you for the introduction the i will say sara and i worked together on the 2000 gore campaign. i think we could have definitely benefited from the univac in florida. you know we were talking about this earlier, right. i'm probably a little bit of the contrarian here.

you know i do think that we are going to hit an inflection point. i am not sure if we're quite there yet. i think the technology, the vehicles, they do exist for the type of inflection point you saw in television and to take a little bit of a step back, right. what happened, television, predated by radio, ultimately television fundamentally changed the strategic way campaigns are run. ushered in the so-called modern era of politics. i use the hub and spoke analogy but it basically focused everything in a hub where campaigns were able to use electronic media, principally paid media you but also electronic coverage, to talk in a one-way conversation with the public. prior to that, you know, campaigns had been much more of a spoke, a little bit of a hub where you actually had to depend on other people out there to be your messengers particularly a country the size of the united states even a couple hundred years ago. i think what you are seeing

happening now is that technology is having an impact. we're going a little bit "back to the future." obviously on steroid because of the impact, ability for information to move as quickly as it can, intensely as it can and particularly the ability for campaigns to have an interactive discourse back and forthwith the public but more so than that. the fact that the public themselves can have a discourse amongst themselves in much more of an active way we have seen really over the last 50 or so years. but i'm not sure whether we have necessarily got to the that transformative moment, right? and as an analogy, and this is a little bit of a flawed one but nonetheless i will endeavor to make it you saw in the arab spring, right? the first time really the proverbial pen in this case in the form of a tweet and facebook and other social media outlets was more powerful than the ak-47, right? that was a market force driving that, a real market force, a real political market force driving social

change with a confluence of technology that allowed that to happen. i'm not sure that has happened in this country yet because i'm not sure we've had that type of an impetus but i think there are vehicles out there ultimately for a huge impact on small d, democracies for public to engage in a different way than they have historically. >> i think that's right. i think chris makes a very good point we may not be transformative in terms of arab spring and entire countries shifting but we are, what twitter and facebook and social media has done is transform the way campaigns communicate with voters and the way people consume their media. so there was television. there is newspapers. there is radio. i think there's a whole new world of the way that people consume information, consume media, consume news and the way that people campaigns, in particular can take advantage of that new platform to communicate directly to voters without having to go on to

television or to get at favorable newspaper story written. so it is different. a totally different medium. i think it has been transformative in politics. >> tucker? >> as their bios pointed out all three of us are spokespeople and i think i'm a disadvantage being the third spokes pen -- spokesperson for this question. i do agree with sarah you. but i would point out there are different dynamics technology and social media is the different the way the electorate will consume this election. what we've are going to see as we've seen in the past technology tends to build every four years. you see a real examination by the public in engaging in new technologies to discover one of the most important decisions that americans can make and aside from the way that news will be sculpted and since the three of us worked actively with the media, i think that is something we'll talk about more later on in the panel and i'm looking forward to

that. also there is an additional component i think we'll begin to see in 2012 and probably even more so in 14 and 16 which is the way that you all communicate to each other and the way you're using communications to talk to the trust friends and family that you have. already and we're here in the sort of belly of innovation, silicon valley, there's a startup in san francisco called votosun. essentially what it does turns your voter pre-sent where you may have been asked in the past to knock on your neighborhood doors and talk to your neighbors and friend who you think you are going to vote for and why they should vote for the person as well we're seeing that actually happen online. so they're taking a pre-sent and -- precinct making it virtual. even from the political outreach in addition to the communications and outreach we're seeing technology begin to have a profound

effect on the way that elections and campaigns are waged. so in that sense it's a really exciting time and i think we're going to see some really cool things in 2012. >> what was the name of that, -- >> votison. >> i never heard of it. i, how do they make their living? are they hired by various candidates? are they a nonprofit or how does this work? >> it is a very early stage company but essentially what they do they allow you to empower your social network so people you may be friends with on facebook or other social networks you can reach out to them and transmit your message and your opinions about the election that you're involved in and, instead of going out and walking door-to-door to meet your neighbors and trusted contacts, you can actually do that from your computer. it's efficient and it is a trusted form of communication. i think that it is a company is really hoping they can leverage that power and help campaigns and elections in the future. this is really their first

election doing that. >> so please. >> it makes sense, right. if you are a volunteer on the gore campaign in west again i can't we would ask you to come to the headquarters and make phone calls knock doors. that doesn't really make sense now, right? if someone called me and asked me to come, call through a tree of phone numbers i would think to myself if i need, if i need to contact people, why don't i contact them on facebook or send them an e-mail? makes more sense. it is sort of the evolution of voter contact basically which is sort of code for the way politicians and campaigns talk to voters. so voter contact is just evolutionized itself to facebook, to twitter, to, just gone beyond the phone tree. >> well that's back, if i understand it the back to the future observation at the beginning which is in the old days of retail politics, it was feet on street. people knocking on doors and now, first of all you know

the right door to knock on and secondly you don't actually have to bother, you can just tweet or something. i mean is that -- pardon me for one second. what we just saw was broadcasting and now you're talking about marketing one-to-one and that's where we're heading. >> that is, you saw elements of this by the obama campaign in 2008 that in comparison to what the company that tucker talked about was fairly rudimentary but at the time was pretty novel. people in san francisco, california, being recruited by the campaign to actually engage with people in swing states that was done more over the phone but nonetheless people are being given a list on their e-mail saying can you call these 10 people. e-mail us back who you talked to and what response has been. so you saw the beginnings of that. i think and i'm dealing with this all the time from the campaign perspective. i think one of the elements that is going to evolve, and

i think tucker is right to characterize it almost an it era tiff process we're in the middle of this as it is happening, the challenge of actually being able to take what we used to call voter files and they're still called voter files. typically a voter file, people create all the analytics in our business we call flags. people are flagged in certain way, right? now what you have going on and both these two can talk about this more comprehensively and more insight than i can, obviously people are intersecting a great deal online where you're able to derive a lot of information about their habits, what they're doing. obviously that bumps up into some privacy issues but ultimately how all that evolves. you will be able to mix and mash with voter files and have information that, you know, is potentially far deeper and far more knowledgeable than we ever had but also the capacity with social media to match it up with the right people to have the right conversations. we're not quite there yet and i said you guys can probably talk about this

more so than i can. there are issues how you sort of create those profiles and all that but those profiles have typically been done off voter nice. you have all the data that people can obviously generate by what people are doing via social media and online and at some point you will get those worlds coming together. there have been efforts in the past, you know i don't think they have quite succeeded yet and there are is legal issues for that but i think ultimately that is some of the stuff that will be happening. >> is there going to be too much data? >> well, you know, i. >> what is the filter i guess i'm asking. if all the people are tweeting like crazy or putting whatever they're putting on their facebook page there is lot of information that didn't used to be available to people who aren't campaigning or supporting a ballot initiative which is a campaign too. where is the filter? do you find, do either of you or any of the three of you find a sense of being overwhelmed by data? >> if i guys don't mind.

>> please. >> i think the filter is every individual on lichb -- online i think that will bear out over time. just like when you scan through your mail box and you pick and choose what you will throw away and what you decide to open and consume. much the same way each individual online has that power. i think what is really exciting about what is happening in technology in elections you have a way to get a lot of different viewpoints and make decisions that are informed by people that you trust and you can filter it around, you can filter it about and make assessments about where the news sources are or the sources of information are that you choose to take with greater weight. and you know, i know that sarah and chris and i were talking a little bit about this before but i think it is speeding ahead some of the ways that campaigns will, will talk to, directly to

voters right now and i think we'll continue to see for some time. arbiters of elections have traditionally been the mass media. and that's something that, some campaigns have had major challenges with. unfortunately i seem to work on all those. [laughter] there is, there is a time that will come i believe when campaigns will be able to communicate really efficiently directly with their supporters and encourage their supporters to talk to different supporters. >> okay. so two questions come out of this. one is, do you see the new world of social media as something in addition to the old world of mass media or something instead of? is that going to displace, you know, in 195 as we were mentioning just prior to coming on that was the first time a political party actively engaged an advertising agency to advertise the president.

that was the agency, and it was for dwight d. eisenhower. by 56 nobody wanted to be left behind. but that's broadcasting that is throwing it all out. you don't know who is getting the message. is what you're describing going to be, is that going to displace what we saw or is it going to be additive on top of it? what do you think? >> i think it is additive. i don't think it will be instead of. so in other words look by the time we get to september every moment of television will be bought in ohio, florida, indiana. you will not be able to buy a television. >> there will be free moments in california? >> yeah. >> that was my initial campaign. >> i was going to say probably stations in california will do just fine, yes. so no one is taking television off the table. i think newspaper advertising and magazine advertising has gone way down but, radio maybe a little bit but no one is

taking television off the table, right? people still turn on their television first thing in the morning to get their news and sit in front before they go to bed. this in addition to. one of the things we're talking about in the greenroom we're in a moment in time where people do not necessarily trust their politicians and they don't trust the mainstream media either. we saw that over and over again in the republican primary debates, in the last several months, right? where people were actually, candidates, romney was actually going after the mainstream media or ron paul was or santorum and i think -- >> newt gingrich as well. >> newt gingrich, right. so i think voters are now at a point where they don't necessarily trust politicians and they don't necessarily trust mainstream media they do trust their friend and they do trust their neighbors and their colleagues and their friends on facebook. so it is additive way to consume news and for campaigns to reach voters. if you get that news story from your friend you're much more likely to read it, right? then you would be just to pick up "the new york times." you may not trust

"the new york times" anymore. you trust your friend sharing that story with you on facebook. nothing is instead of i think it is in addition. >> i think in the middle or at some point in the evolution. you used the tv example, right, but still go back to 1960. tv played a pretty decisive role with the debate between kennedy and nixon. >> yes. >> at the end of the day which campaign was more effective turning out voters who were in southern illinois and kick go which ultimately tilted that election. there was still the feet on the ground aspect to it in 1960 even though tv had been there i sort of think we're in the evolutionary phase. what is constantly in my head the gap versus yelp models. which is right for years as someone who likes to travel for places and i go look up a nice restaurant. that has quickly been replaced by yelp which is

crowd sourcing social media platform that the gatt is trying to catch up to what yelp created that is defined food area. that is metaphor for the direction we are going in. sarah addressed core of this which is the idea of authenticity and trusts. i think ultimately in any competitive election it cams down to authenticity and trust assuming it is a competitive election and i think that is even more so in online and social media in terms of how people engage and interact. my guess we're in the middle of a evolution. at end of the day i run any number of campaigns particularly in this state, usually the initiative campaigns and right now nothing defeats going up with pay television. we do an awful lot on various social media platforms. they do have an impact particularly in advocacy and organizing. when it ultimately comes down to convincing the band of voters who are uncommitted or undecided, and inelegant and inartful

and the proverbial hammer hitting the mosquito, nothing that moves you like pay television. it is what it is right now. do i think that has the potential to evolve? yeah. >> if i could just add a little something to chris because i think there's an important thing for people to consider on the television point which is, you know, you mentioned is there something that is going to tip us to more of an online technology communication stream for voters to campaign? . .

>> really with the consumer of information, um, that is the younger generation now, as they continue to get older, um, i think that you'll see the that being the forcing function for more of the investments by campaigns and elections to get into technology and technological advertising or online advertising, i guess, is the way i should say that than they are in television and your local network news because that, that demographic is no longer going to be the leading consumer. and, or the most active voter. >> if i understood you correctly, when you were talking about the election of 1960 which this was supposed to be a defining election with regard to media because it was supposed to prove that the media was the message, and the reason that was true is because it is said, correct me if i'm wrong, that more people who saw the debates, the so-called great debates on television, thought that kennedy had won, and more people who

heard them on the radio thought that nixon had won. and the words were the same, so the medium was the message. and, um, if i heard you correctly, also, you made reference to the disposition of the state of illinois in that election -- >> the great state of illinois. the land of lincoln. >> that's what i've been told. [laughter] it was also the land of richard j. daley -- [laughter] >> or rahm emanuel. >> yep. >> a lot of close friends. but my recollection is that joe kennedy -- i'd like to be corrected if i'm wrong -- joe kennedy called richard daley during the election and said are we going to take illinois, and daley said by the grace of god and is with the help of some close friends, and those close friends were the graveyard vote, basically. >> yes. i mean, i, obviously, was not around, could not personally attest to that, nor would i take

an affidavit -- [laughter] >> chris is a lawyer. >> also the reason i invoked that particular moment was that, you know, richard nixon had a very similar conversation with a very powerful series of leaders in southern illinois. and, you know, what you really had to the extent you believe what has been reported on some of this stuff and, again, i'm not a firsthand witness -- >> no, but we're believing the mass media. >> right. you know, theoretically what you had was you had southern illinois having a bunch of folks who may not have been alive voting and you had the chicago area having a bunch of folks who may not have been alive voting. at the end of the day, you still had an election that was impacted by some old style politics that were taking place at both ends of the state, and one side did better than the other side. >> ah, so if i don't want to be lonely, i can move to ohio and get a job in a factory or die? [laughter]

because the graveyard vote is still going to matter. >> people will be e-mailing you and knocking on your door all day. [laughter] >> one of the things that strikes me was this mention of getting a whole bunch of people together in san francisco and getting them to contact people in states that are in play. is this something that people talk about? let me ask -- let me tell you why i'm asking. because of the electoral college which is a relic of the 18th century, you know, institution that was written when this was a country of four million people hugging the eastern coastline, we have something called the electoral college. and what it does is it effectively disenfranchises me from the presidential election. doesn't matter. i live in california. i moved from massachusetts, so from the frying pan into the fire. it doesn't matter whether i vote or not. and does that matter? well, in the election of 2000, you know, either vice president gore took florida or he didn't.

i mean, look, maybe 35,000 jewish voters in palm beach actually did vote for pat buchanan, i don't know. [laughter] >> yeah. we're pretty sure they didn't. >> but there's no question that gore won on -- >> popular vote. >> -- on the popular vote basis. >> right. >> but that doesn't matter because that ain't the way it's counted. so if i heard you correctly, and i'd like to be corrected if i'm wrong, is that to a certain extent you're empowering me as somebody whose vote doesn't count because -- or the new technology, put it this way, writ large is enabling me to influence someone in ohio or in colorado or in, you know, the ten states that really do matter, we're told, in this election. is that true? >> yeah. i think that that's not a necessarily new practice. i think that, um, you know, as long as we've had, um, elections that have existed out of a single province where counties will call in to target counties and, you know, states into target states, so that's been

going on -- >> my question is will the new technology make that more scientific? >> it'll make it more efficient. >> yeah. more efficient, more targeted. the efficacy will improve significantly. >> for example, i have a college classmate who works in cincinnati. for all i know he doesn't, he hasn't made up his mind. so if i went to san francisco, would this company you talked about in if san francisco or would facebook or twitter sort of know that and tell me to get in touch with tim begin? >> i think there will be targeted advertising that campaigns will be able to invest in that will be able to identify, um, whether or not voters have certain sentiments on different issues. and so, you know, to your specific question, um, you know, if your friend in cincinnati was to have strong views on a certain, um, type of issue, um, then they could be getting advertising, um, through the campaign directly to them. and it is quite possible that in the future, maybe this election,

that there would be a campaign or organized enough to know that you should be reaching out to your friends that are weighing in on a specific issue based on direction they're giving you. so, sure, there's a -- you could get communication from there a campaign that says if you have friends that have weighed in on this issue in this manner, um, you should reach out to them and tell them the truth. in fact, i think that gets back to where we originally started the conversation around how, um, the media battle will be changed as a result of, um, the online communications and social networks, um, because, you know, starting, you know, two elections ago and certainly 2010 it became much more high profile, but now the way that campaigns are working -- remember that john mccain who is now one of the most prolific tweeters -- >> yes. >> -- in the world did not have a twitter account in 2008 when he ran for president. and so, you know, we've seen already an evolution in 2012 both candidates will have great

twitter followings and, um, they'll be weighing in on issues quickly. and so i think what you'll end up seeing is, um, you know, that rapid response move through social media so people are seeing content on tv, or they're picking up on a national news media event, and they're able to get direct communications from people they trust, um, either supporting it or voicing an opposition to it. >> yeah. couple quick thoughts just picking up on that. one, i do think, ultimately, you are going to get the segmenting of data as systems become more interoperable and you can shift and move this stuff. so it's certainly conceivable that live anything san francisco i could get a list of 20 people who have some connections to me at some point in my life. i'm always able to determine through various databases, and they've been identified as undecided voters in key states, and i get an e-mail saying, can you call these 20 people?

can you, please, ask them to support candidate x? i think that's certainly something that's going to happen in some form or fashion. right now you have entities, there's a company in san francisco which is founded by one of the founders of travelocity that has created this technology where it's, basically, a dashboard, and you can follow -- not only follow everyone who's talking about your particular candidate, they also use this for hotels and other types of businesses that have high consumer interests. not only can you follow anyone who's talking about you on social media, but it identifies specific individuals that are particularly influential in social media. so they'll say this particular person is tweeting about you, they have a large following, but more than just a large following, they have a large following that's in a demographic or matches up with issues that you or your campaign should care about. so you're able to target your communication and engagement back and forth conversation with that particular person who's particularly influential because they have a much larger universe

of folks who trust them. so i think you're going to get more and more of that type of technology coming into play that becomes tactical tools for the campaigns to more effectively engage in that dialogue. >> so the dialogue is the key. >> yes. >> we're talking about a dialogue -- >> yes. the back and forth. >> yeah. >> chris brings up an interesting point. politer, he's talking about being persuasive on social media, and four years ago these candidates weren't, you know, one of the major nominees wasn't using it. so that's how much we've advanced in four years. so it's exciting every time we have one of these elections where people around the world will be focused on this decision and new technologies will spring up, and, you know, it'll be exciting to see things like politeer that will emerge in 2012 and what we're going to see in 2016. >> if television is going to be -- if this is going to be in addition to rather than instead of, are you telling us that campaigning the going to become more expensive? because someone's going to have to pay for this, and it's going

to be in addition to, not instead of, money's going to have to come from somewhere. >> we see it get more expensive every two years or four years. in the year's presidential election will amount to spending at more than a billion dollars -- >> each? >> that is unbelievable. now, not helped by the supreme court who said that corporations can decide to play in these campaigns as well. so you're going to see enormous amounts of money flow into these races because you've got super pacs who can spend like crazy. but i think we are nowhere near the tipping point where they become less expensive, right? i can't even imagine. >> no, i mean -- i'll give a shout out to facebook which is, you know, to buy advertising on facebook is a lot more efficient -- >> right. >> -- um, and cheaper than it is to buy television, right? >> right. >> now, i think there's different metrics, and people on my side are still trying to figure out can we actually get to the proverbial swing voters?

[laughter] i'm shocked at the answer, but, yes. bottom line is assuming you can get to your targeted voters and you can get to them in a way that moves them, then it's a much more efficient hitting of the bull's eye. we talked earlier about pay television uses the mallet, right? 80% of pay television viewers have made up their mind one way or the other. social media and other online tools, you can focus in on a bull's eye target so every dollar's actually communicating with someone you want to talk to. >> do you think that the obama campaign's, you know, four years ago, not now, but they were obviously out front versus mccain with regard to social media. i mean, it was famous, the president had a blackberry, the now-president had a blackberry, and hopefully -- so how much of a difference do you think that made in that campaign? i mean, do you think -- and even

let me ask you, and then i'd like to broaden it out more generally because i have another question following. how much of a difference do you think it made? >> well, i think it made a huge difference. i think the obama campaign in 2008 was the most, they were doing the most cutting-edge technological voter contact, fund raising online, reaching millions of people that we'd ever seen, right? and to be honest, if they were, if they took that blue print and they did nothing but the exact same thing in 2012, they'd be crazy, right? so they've already gone -- and i'm not -- >> the world's changed -- >> the world has changed that much. tucker's exactly right, john mccain wasn't the only person without a twitter account in 2008. it was in its infancy, right? so they were incredibly cutting edge in 2008. i'm sure they're doing much more, much different stuff in 2012 to stay ahead. do i think it ultimately made the difference between a president obama and a president mccain? i don't know. i think -- i don't think it did.

i think that it was the year for democrats. i think president obama had a message that spoke to the country. i don't think technology made the difference between him being in the white house or not, but it made massive amounts of difference in terms of fundraising and reaching voters that wouldn't have been reached otherwise. >> can any of you put your finger on an election, and not necessarily for an individual, but for a ballot proposition, for example, where you feel technology actually did make the difference between, you know, a win and a loss? >> i'll use one example which is in technology, it works many different ways. i mean, we can talk about communicating with people via the social web, or we can talk about e-mail trees, um, but really there are campaigns it rating on technologies in a lot of different ways and really exciting ways. for example, you know, the whitman campaign in california, um, developed a system to be

able to track realtime jerry brown's speech. so when jerry brown would have an appearance, there would be someone from a campaign -- from the campaign with an iphone live streaming it so the communication could be e-mailing reporterses' responses to the actual charges that jerry brown was making in realtime. and it was the first time they'd been able to piece something together like that. now you're seeing campaigns at the state level doing that type of thing now. of course, at the national level you already have a live stream with television stations. but as to whether or not a campaign actually made the difference, um, you know, in kind of an unconventional way, brian bilbray who's a congressman in san diego in 2006, um, it was a special election, um, duke cunningham had been run out of town for good reason, and that was a hotly-contested seat, um, and

was seen as a bellwether as to how the 2006 house congressional elections would ultimately fare. unfortunately, it was not the bellwether that the republicans had hoped. but we at the rnc were providing a lot of assistance to brian bilbray who was running against a candidate who had been captured on tape, um, inviting, um, someone who was not a legal voter to participate in the election. and in that particular district in san diego, this was very controversial. that, that tape was then moved to youtube and then put on the talk radio stations in san diego, and in such a hotly-contested race, i think that a lot of people that were participating in that election will look back and say catching that technology and moving it in the way to the media that it did, it ultimately changed the election. i mean there's, you know, the famous mcca ca moment again in 2006. so these things -- candidates making slip-ups and saying things that they shouldn't

have -- >> can't escape them now. >> you can't escape them now. >> right. the famous event in san francisco where a blogger happened to get, you know, then-senator obama talking about pennsylvania which instantaneously by the next morning was a major national story and still an issue that the president -- >> this is when he said they have their guns and their religion or words to that effect? >> to that effect. this is a similar type of situation where that got -- you know, that -- >> could i just -- >> yes. >> could you just tell the audience what that moment is because it's possible that some people in this room don't know what it was. >> senator george allen who was an incumbent senator in virginia -- >> and people thought he was a presidential -- >> early presidential type of hype building around him, um, you know, i think that a lot of people considered his race in 2006 more of a technicality. um, he was popular in the state of virginia, had been governor of the state of virginia and was caught on tape by a phone, um,

you know, making a statement that was a racial slur. and it wasn't tolerated by the electorate, and he was ousted from office. and, you know, i think that that was a turn of events that was made possible, um, by his democratic opponent because of technology. but there's a lot of technological innovations that are happening on campaigns aside from just online communication. um, and it's really fascinating to watch. >> chris, i interrupted you. >> you were talking, my first national campaign was in 1992, and i was much younger and much quicker at that time, and one of my first assignments was to go to opposition events, um, and then you would actually have to sprint with the reporters to the nearest pay phone to call back to whatever had transpired, right? just think of that compared to now with nanotechnology, you're going to have nano drones in the next ten years, you going to have a nano drone -- just think

of -- >> right. >> with watergate, all the president's men would have used a nano drone, and they would never have had to break into the watergate. [laughter] but, you know, i do think, to me, it's sort of the first defining moment with text was really the dean campaign because i think that's the first time -- i mean, i distinctly remember being in a campaign discussion for a rival campaign in in the first quarter of reporting, and dean's money just kept rolling up, and everyone kept reporting his number over the course of the day getting bigger and bigger by substantial amounts. and i remember we were in a meeting, and someone said, oh, a ceiling to what you can raise online which then precipitated a discussion about the quote-unquote cat cascade effect because the multiplier effect is different than what you typically had in the past. i always remember that as really true, at least for me, sort of a defining moment of when you saw -- i'm sorry, i didn't mean to -- >> no, that's okay. in will being to tucker, i worked on the other side of that

brian bilbray race, and for as important as technology is -- and i believe that, i work at facebook -- it's interesting, the morning after that special election we all woke up, went to the dccc, rahm was going crazy -- >> [inaudible] >> yes. and what we took away from that race was not that our candidate had just gotten beaten by saying something really stupid while an iphone was rolling, but, um, we had not tied the opponent enough to a very unpopular president bush. so our takeaway from that was that it had nothing to do with technology, but that we had missed the elephant in the room which is we should have tied brian bilbray directly to george bush. so it didn't have a whole lot to do with technology, and i guess my larger point is there are still some really big things that matter. so you can get all the technology right, and if the economy is bad, if the president's unpopular, if the country is against you, the right track/wrong track's in the

wrong place, that stuff doesn't matter at the end of the day. >> do you think the forest for the trees is going to be a problem, so much narrow casting and such specificity that there's going to be some huge, gigantic fact out there that just gets -- >> well, i think, actually, to sarah's point, i mean, in -- i'll be the first to admit this -- 2008 wasn't a close election, and i think there were strong reasons why the economy was, ultimately, the deciding factor. i've heard people i worked with on the mccain campaign say that, actually, that campaign was decided in the mail. the most effective mailer that was ever sent was everybody's retirement accounts when they showed up in october. [laughter] and so, but actually you look at this election, and i think the technology really will make a difference because i think that this is going to be a much closer election. depending on if we see sea changes in the global community or in the economy, if things remain the same, this looks like

a 50/50 race -- >> i don't want to put you on the spot, but we just heard from sarah that what you didn't do as effectively as you wish you had in many hindsight, perhaps, was tie your opponent to a very unpopular president bush. why won't the democrats do the same thing with the republican candidate and make it modest? why does your instinct tell you this is going to be a close election, i guess? >> well, the polling data suggests that right now. i think that, you know, potentially -- >> it's a 50/50 country right now. >> if i could tell you who was going to win this presidential race -- >> let's keep it between the two of us. [laughter] >> i believe it's going to be a closer race than what we experienced in 2008, and when the margins of these races get closer, i think technology becomes -- >> it matters more. >> -- increasingly relevant. >> right. >> so investments in that type of communication are going to be really critical in this

election, and i think both campaigns realize that. >> and i just asked sarah and chris, do you think this is going to be a close election? i mean, barring the unforeseeable, you know, war with iran or a complete stock market crash, do you think this is going to be a close election? >> yeah. i think it's a 50/50 country, i think the president is in an incredibly good position, he has an amazing record to run on, a lot of successes. but you have to approach every election like it's going to be very close, and that's the way we approached 2006, 2008, so i think you always approach it that way and, ultimately, this is a country that's very closely tied. so i think, yeah, barring something massive, it's going to be a relatively close race. but the president's in a very good position. >> yeah. i think that's absolutely -- first of all, i do think presidential campaigns are different from congressional races and senate races, they're very different animals. >> well, on the essence of that -- >> i'll finish this which is that i do think these guys are absolutely right. this is going to be an

exceptionally close race, i think, for all the reasons articulated. i do think a point sarah made earlier is worth sort of belaboring. i do think there are macro issues, right? there's an election where the incumbent is in such a difficult position that you could run a refrigerator against the incumbent, and the refrigerator wins, right? then there's the election that i was in in 1996, the incumbent is very strong, bill clinton could have run against a combination of gandhi and mother teresa, and he still wins. and then you end up with an election like this is going to be, because of the large macro forces -- primarily the economy -- it's a gray area, and it is a 50/50 country or really a 47/47 country with 6% of the electorate up for grabs in five or six states. that's what the election is ultimately going to come down to, and my view is, you know, gdp states between 2-3%, and you continue to have at least the job growth stays where it is or

generally static, it doesn't go backwards, then i think under that formula the president wins because he has a decisive advantage on the trust issue. if you have gdp that gets below 2%, and hope for everyone it does not, then i think it becomes a more challenging election. >> [inaudible] >> yeah. anytime you get to that close of a level where you're really slicing the political bologna that closely, every single tactic, oh, the gore campaign, there are 5,000 decisions you could look back in retrospect. it was that close, if you had made this or that, right? it keeps you up at night. so i do think technology in all of this if the election comes that close, it will have that type of impact. sarah's point is right, there are some larger macro issues. >> we have a whole bunch of questions from the audience, and let me just sort of read them and see. will web 2.0 or a successor lead to local and national voting or initiatives on the internet? which, i guess, another way of asking that is do you think we're heading toward digital

democracy? >> this is my favorite. i love this question. do you mind if i take this -- [laughter] >> no, go for it. >> i do think, ultimately, potentially it's that transformative a tool. i typically do campaigns on the progressive side. i am doing the campaign right now to raise the tobacco tax a dollar. we're going to spend a couple million dollars, big tobacco's going to spend $40-$50 million against us. we've been a slingshot campaign every morning. >> god's work. >> it is god's work. freedom, justice and democracy. [laughter] but, right, the initiative process in california was initially put in place, hiram johnson, to be a bulwark or a hedge against major, powerful interests that used to control the statehouse. it has over the years become a tool, in fact, for powerful special interests to use in any number of ways, and, you know, at times progressive groups can cobble together enough money and get something on the ballot.

but imagine if you actually gave the public, you know, the ability to do electronic signature over twitter or over facebook, and it did not cost two and a half to three and a half million dollars which is the price tag to qualify an initiative. you know, suddenly, you know, the public at least in this state and other states, there are 30 some odd states that have initiatives would get sort of the initiative process back to the way it was originally designed. um, and i also think, i think this is going to be a battle that's going to continue to become, you know, a bigger and bigger conflict which is the ability to vote and do other types of direct democracy, you know, online. and i think all of those things -- that's why i said earlier, i think there are tools in place. i'm not sure they've necessarily been used in a transformative ways. i think those are ways it would be enormously transformative. and the final one, i'm sorry to talk so long, but there was the twitter debate in south carolina, and you had romney and the others, and, you know,

twitter basically gave a green and a blue whether they thought the broader public was responding if they thought the candidates were being honest or not honest. and, you know, romney had a very difficult debate where he was in the red almost for the entire debate which then set him up for four or five tough, challenging weeks which set up his negative storyline that's going to last throughout this campaign. imagine if you are in a world where candidates are going to, basically, be able to get constant dial tests on an ongoing basis, and you're giving a speech up there, you could literally having something in front of you that tells you how the crowd or the public is responding. i don't think you're that far from seeing some of that technology used in that type of way and, to me, you can say that could manifest itself in a good way, on the other hand, people could be just becoming very good at understanding how they want to use that to their advantage. so i think that the tools are out there. i'm going to be very interested in seeing how they ultimately manifest themselves. >> so you can see a world someday where a politician is

literally giving a speech, and he says, yes -- or she says, yes -- and the screen turns green, and as the politician says by yes i mean no -- [laughter] and the screen turns red -- >> right. >> and you could even go farther. people talk about singularity, right? >> yes. >> we had up there earlier, imagine if you had something that a nano, somehow implanted in you somewhere, right? and you're automatically able to have communications and be able to process that in realtime. again, sounds farfetched, sounds like science fiction stuff, but, you know, people are actively talking about a world where there's going to be singularity, and this stuff is going to be integrated into your being. >> so technology can liberate by inner bill clinton and then help me understand and relate to people? >> as long as you bring all the job cans bill clinton did, people will be very happy. [laughter] >> oh, go ahead, please. >> are i was just going to say getting into the slippery slope there -- [laughter] >> i think we slid down it. >> yeah. >> i think there's a practical

application in technology in the way it manifests itself in future elections we should probably talk about which is something chris has talked about before in our previous conversations which is we're moving toward a place where you'll be able to make more informed decisions because people will be able to communicate and advertise to you more personally and in a targeted way. so it may be that the most important issue to you is fisheries. i bet you that you do not hear anything about fisheries in the presidential election in 2012. now, there may become a time very soon where because of the targeting nature of political campaigning and advertising they'll be able to communicate directly to people that do care about fisheries about what their position is on restoring wildlife and insuring that cattle aren't destroying upstream fisheries. and so, you know, in many ways i think there are going to be technological evolution toss the way that we are -- evolutions to the way we are communicated with via campaigns that'll really

help us make better-informed decisions as opposed to necessarily giving rapid-response feedback to the candidate which they then cajole to conform to. i think it'll be more you're going to know more about the candidates and feel better about the choices you're making. >> there's a question that deals directly with this, so let me just read it. communicating about complex policy issues using conventional media is almost impossible. have you seen any examples of using new technologies to do a better job of engaging the public in a policy debate that goes beyond simplistic slogans and talking points? [laughter] >> great question. >> well, that's not a question -- [laughter] >> i thought it was because what you were saying, i thought, was that, you know, through using new technology fees you can get deeper into what people actually do believe about what matters a

lot to you. that's what's being asked here. what do you think? >> maybe one of you guys could talk about the sopa example. i mean, that was a debate -- >> i'm happy -- >> do you want to talk about it? >> go ahead. >> please, go ahead. >> well, i was actually going to say something different which was that i can see, and this goes along with what tucker was saying, i can see a time where campaigns or even incumbents who are in office who are serving in the congress are so, um, are able to be so targeted and so focused on what individual voters want to know and are most interested in that you could end up getting policy papers and speeches and every, you know, constituent letters and sort of everything targeted to you on a very issue-specific basis, which i think is probably the targeting would probably be the best use of the technology that i could think of to answer that. >> yeah. i'll give a couple of examples i think are at least consistent or maybe not specifically on point.

exactly how all of that plays itself out, but we did a campaign a couple years ago where we actually did a challenge, you know, online for folks to come up with the best tv spot, and we just sort of put it out there, and we offered to run the winner, um, which was going to be based on a crowd-sourcing vote on the jon stewart program. shockingly, maybe not that shockingly, the ad that ultimately was the winner was better than any ad the campaign was producing. it was a really good spot, and we ended up running it more than just on the stewart program. but we really engaged a very broad audience, actually, as we were going through the process. tried to buy our site from us because they looked at the analytics. they had no idea it was a campaign, and it was a great demographic. this -- and, tucker, i'm sorry to bring this up, but during the meg campaign, i ran an ie, and we actually -- this was probably the exact opposite example from the present question, but there's some relevancy here. we created something called

megpedia, so we had folks who had worked at ebay who poured stuff in over the transom, a number of items which reporters later took, did some investigative reporting and tested out and proved out. so that was sort of an interesting way to use crowd sourcing in an opposition research way. now, that may not necessarily be the most constructive way to use it for the creative democracy, but it was a really interesting tool to apply, and i do think you're going to see some elected officials, you know, begin to use those types of crowd-sourcing tools as a developed policy. the president, i think, has done it to some extent with some of the town halls he has done and the conversations he's had. there actually was some kind of effort at the white house to involve the public, but i think that, you know, you will see -- as someone who runs for office who decides to, basically, have an open source campaign, he will ask his followers to create the

ad. he will, you know, ask his followers to collectively come up with a policy position based on some of his principles and beliefs, and ultimately, maybe that person gets in office, and then that's reflected in terms of how they approach the government. i do think you'll see that, some kind of an open-source campaign. >> i have another one for you. will what you're discussing or what's being discussed up here right now make campaigning bidirectional or candidates react to messages from voters as much as they push messages to voters? >> you know, this -- and this, i was mentioning sopa before because i think it's relevant and it's timely, you know, recently. um, there was some debate about, um, access to the internet, and this was a huge news story, and i'm sure that you've all seen in the last month or so. and i think that was an example where, um, these i guess it's probably dated to call them net

routes, but, you know, at least that's what they were originally called came out of the woodwork, and people were communicating to congress in really, um, energetic and active ways to each of the individual members of congress. and it was an overwhelming success for the technology community, um, and i think that it goes back to an earlier point that sarah made which was like, you know, we can talk about campaigns and elections, and that's great because there's so much information that's being pushed out to so many different people. but probably the most exciting things that are happening are what people are doing in technology and giving feedback on specific policy debates going on so they can get a better idea in the realtime about what positions they should take into account. i don't think i'm forsaking any confidences that there were some individuals that came and visited us that work actively with the congress to explain that they'd actually been able to determine that the

traditional writing your congressman a letter and your congressman writing you a letter back has decreased dramatically as a result of facebook's product. because members of congress are on facebook, and they're actively, every day talking about the business that they're taking up in congress, and they're getting feedback from constituents in large amounts. and they're able to communicate in a much fast and timely manner so they're not getting a letter ant a bill that they voted on three weeks ago and sending a letter back, and by the time somebody else gets it to consider, you know, in with the christmas cards and totally ignored. so we're getting to a place where people can understand the government better, and that's probably the back and forth conversation that people are benefiting from most. >> what do you think? i mean, do you think this is going to -- is this movement or this set of technologies that are now available, and it seems like they're springing up all over the country at a rate that those of us who are not really in the business are really

unaware of, is it going, is this going to make government at the end of the day more responsive because people are going to find out more quickly about what they really care about? >> i think it will. i think to the extent that a voter or a constituent, even a citizen, is interested in what's going on in washington, in the congress with someone who's running for office, to the extent that they're engaged and are paying attention and want to be involved, they will receive a dialogue back. so, you know, almost everyone has a voice with the person who's running or with the incumbent, and they get a dialogue back from that person. and one of the great things about facebook and twitter is that members of congress become real people, right? they engage with constituents on both platforms. they don't typically only talk about the vote that i just took on sopa or the vote i just took on health care. they also say, you know, looking forward to being in menlo park this weekend for, you know, my family barbecue, or looking forward to, you know, taking my

daughter to college next week. they become sort of real people, and they can interact with voters on a more normal basis and in dialogue. and so i think it'll be more responsive, and it's also more human. >> is that dangerous? because when you become a real person, then you put a lot of things in play that, you know, none of o us have perfect pasts, that, you know, maybe would best be sort of left out of the public sphere? >> as long as you take the anthony wiener pledge -- [laughter] right? use common sense in terms of how, i mean, i think people are going to sort of learn, you know, those protocols. there's been a number of folks who have run for office and put something on facebook that they shouldn't have posted there. but, i mean, you're seeing an entire process taking place. i see it with my kids, they're being taught and learning there's a whole cultural process going on. i do want to come back because i

do think there is a tension right now between how social media and technology is impacting democracy and sort of structural issues in democracy. there's so many structural issues right now that are effectively designed to push people not to find compromise and not to get -- from both sides, and they are effectively forcing people to go to the opposite ends of the field. and i think -- i don't know what the answer is going to be, um, in terms of whether social media and technology can help alleviate or address that, you know? aspirationally? i certainly hope that that is the situation for the benefit of small d democracy, but i think that's going to play itself out in a really interesting way because i think if you look at citizens united has created structural issues, the types of districts people are coming from, you saw the speech last night from the senate candidate who beat dick lugar in indiana who, basically, effectively said i have absolutely no interest in reaching the middle ground or compromising. this is a war, and there's only one winner -- >> by the way, did you happen to

see lugar's letter? >> i did. but that's the type of politics taking place in the states, here, in d.c., all over the country. so can social media and technology ultimately -- my belief is that the vast majority of the public actually is a lot closer in some form or fashion to the 50-yard-line than our political process reflects, and can social media be used as a tool and vehicle to help actually cultivate that and provide an incentive for people to get back to the center or get back to reaching compromise, you know, get back to the understanding there's an election, the election ends, and we actually have to deal with ig ig -- big issues. >> do you both feel that way? the public as a whole is actually less extreme than representatives who are getting elected? >> absolutely. and i think, you know, what chris mentioned is exactly right. you look and you watch cable television, and you see two people that i can't determine what their relevance are to the political process yelling back and forth trying to be more

bombastic and characterizing the other's views. and when i see views that are taking place on my news feed or online or e-mails i'm getting from the my friends, in particular when i'm getting news on my news feed and facebook, and i can see people i may not agree with on a political issue, or maybe i didn't know they had that view on a political issue, it puts a human touch -- i know that guy's a good guy. i know her, she's a friend of mine, and her coworker. they have strong views about it, and it makes me think a little bit differently about that issue. opens up my ears to maybe considering things i hadn't before, and that dialogue is lost in a lot of what we're seeing right now. and i think as online communications and social media grows, i think it's a positive force. >> so that's another back to the future, it seems to me, observation. because when people gathered around post offices which is where they gathered around in the 1840s and 1850s waiting either for the mail or the newspaper, they talked.

they came to, you know, with the single exception of 1860, i mean, we've had transits of power every four years in this country or eight without violence. and there are very few countries in the whole history of the world that can say that over a quarter of a millennium period. so with all the faults that our system has, it's worked that well. i think the question is, you know, you know, is this going to make it better, is it going to make things more of the same? i mean, lugar's letter which i only just saw just before coming over here was quite interesting. this is the senator from, i think he was a five-term senator is my recollection, from indiana which is sort of a land of steady habits as far as i'm concerned. and, you know, the idea that he'd lose a primary, you know, four of five years ago, this would have been unthinkable. and yet it happened. and it happened because he lost

to an uncompromising opponent, and uncompromising people are easy to admire because they don't compromise. but when you get to washington if you don't compromise, you have stasis. we have proof of that. so we're sort of in if a catch 22, and what in heaven's name's going to get us out of that? and what role does technology have in getting us out of that? i don't know. >> look, i think the comments were right on. aspirationally, i certainly hope that it serves as a way to actually elevate the level of discourse to make it more civil, ultimately have people finding common ground. but i honestly don't know how this is all going to play out. i think that is going to be one of the really interesting dynamics. i do think as you touched on you have communities where people know each other and are having conversations, on the other hand, you read in the article that provocative on any public policy issue mainstream publication and you go online and, you know, these sort of victory, all of the comments are

people attacking each other. i mean, it's fascinating in some ways, you know, reflective of democracy with people out there engaging, but, you know, the language tends to be pretty tough and pretty try department. so, you know -- strident. you know, i don't know. i hope it does. >> you have to pay attention to what's in their eyes all day long. if you spend an enormous amount of time on facebook and in conversations with your friends, family and coworkers about the issues of the day, you probably are hearing a generally back and forth be, and you're having a civil conversation, right? you turn on cable news, and they are putting a spotlight on the most obnoxious, the rudest, the person who's able to scream the loudest, right? and then they put a spotlight on the next screen over which is the person who can scream the loudest on the other side. and when that is, when that is the sort of 24/7 thing that's happening on cable, i think it, um, it brings out emotions in everyone else, and i think it makes people think that politics is like that. and i think politics is like

that a little bit which is -- >> nature imitates art to some degree, in in other words. >> yeah. when you have a media that rewards poor behavior and, um, screaming and partisanship and, um, live television cameras on things, on events that they know will outrage people and bring about fights like, you know, the minister of, you know, a church population of nine people in arkansas or whatever who's going to burn the quran. when you decide you're going to put live tv cameras on that, i think that's where we end up. put a spotlight on that versus the fact that people are having a very civil conversation in most parts of the country. >> i guess what i'd come back to is i think at the end of the day this country, as touched on, has generally gotten stuff right. >> yeah. >> i think sometimes we go through periods where we're feeling our way through. i do have great confidence that, you know, historically sometimes we may make a mistake or two, but generally this country's

exceptionally good at getting it right, and my sense is we're sort of going through one of those periods, sort of feeling our way through this process but, ultimately, i think given the establishment of protocol and sort of cultural understanding and, you know, in the future if people want to cover those events, they'll just discount them and not respond. >> right. >> in a way as people become more sort of attuned to how it works, hopefully, as you get more and more people, broad segments of the population actually living their daily lives online and engaging, that that actually will then serve, you know, sort of that leveling process and actually work as a way to bring people together. >> i do think we've gotten it right over the long haul. >> we're running out of time. let me just ask the three of you an impossible question to wind things up with. let's say, let's say for a moment that i'm mitt romney, and i call you up, tucker, and i say i need some advice. i want to win this election. what would you tell me to do to

win? >> hmm, that's interesting. [laughter] >> yes, tucker, what? >> i would tell governor romney you should probably check my track record and call someone else. [laughter] i actually think that some of the things that we talked about are things that the romney campaign will internalize. um, and that they hopefully will avoid the temptation to, um, drive people apart and wedge different constituencies. um, and address the problem that we're talking about which is how toxic the environment has become in politics. and, you know, say what you will about governor romney, he is an outsider to washington, and i do believe he's been able to be effective in a very blue state, and he is a person that understands compromise.

and i know that's unpopular to say, but i hope that when all of the cameras are on him, that he will go back to considering that being able to agree on certain things and agree to disagree on other things but wage a course forward that delivers real results is something that the electorate is looking for right now, and that sells just as well in ohio, in florida, in virginia, in north carolina as it did in massachusetts. and i'm confident he will, and i think that governor romney has a very good chance of being the next president of the united states. >> sarah, you've just heard tucker say that governor romney has a very good chance of being the next president, and i assume you're talking about 2012, not 2016. [laughter] so i'm barack obama. i phone you. i've just heard this because the president watches c-span, and we're going to be on it. >> we're live. >> i need your advice on how i should run this campaign, so i'm going to be reelected. what would you tell me to do? >> i would say that the way that

you acted today is a perfect reflection of the president that people love and that -- [applause] and that i think one of the things that the president, that people love about the is how authentic he is, and he showed that today. and i think the people appreciate that and voters appreciate that. and i think, um, you know, one of the reasons i have so much confidence in him is because of his record which i think that he'll run on, but i also think he's an excellent campaigner, and no one is better in a one-on-one fight than he is. and that he approaches campaigns, um, that campaigns are important, and they're decisions, and they're decisions about the future. and, um, you don't, you don't go down in a campaign for not say what you think or not say what you feel or not saying what you think is the right way forward with the country. and so, um, i think he'll go in, um, guns blazing, and i think he'll be the campaigning that we've seen for years, and i think he'll be the authentic

president that we have seen for the last four years, and i think that he'll be quite successful and do just fine. >> what do you make of the two comments that you've just heard? >> i would say this as a democrat, tucker was very self-effacing. he is one of the best in the business, and i know we, on my side, were all very excited when he moved into the private sector. [laughter] stays in the private sector. and as someone who wants to see the president get reelected, i hope that sarah can take a little bit of a vacation from the private sector and maybe move back over to the campaign for the remainder. i thought both comments were right on. i think the commonality you heard in both was exactly right. campaigns, particularly this day and age that we live in, come down to trust. who's the authentic candidate? who do you trust to make decisions about you and your family? i think the candidate that does the best job of that is going to be in the strongest possible position, and, you know, sarah,

you hit it right out of the park. i think anyone who's on my side of the aisle who fundamentally believes the country's going to be a lot better place for the next four years if barack obama is elected has got to be absolutely thrilled for the historic steps he took today, what it means for the country and his re-election. >> i have absolute confidence in john hollar, and i -- [laughter] i'd like to ask him to come up and, first of all, let me personally thank the three of you. it's awfully nice to come here and educate us, but let me turn the floor over to john. >> please, keep your seat for a second. please join me in thanking the panel. [applause] i think you know one of my favorite quotes about the museum was given to me by a member a couple of years ago who said this is the switzerland of silicon valley. [laughter] so i hope we've had a very swiss, but very provocative and wonderful panel tonight.

so thank you to all of you for being here. richard, thanks for leading it. have a good night, everyone. [applause] [inaudible conversations] >> senators are attending their weekly party lunch meetings right now. they'll be back at 2:15 eastern to continue debate on extending a food and drug administration user fee that funds fda reviews of prescription drugs and medical devices. the bill also creates a user fee for generic drugs and a national system to track prescription drugs. amendment debate when senators return at 2:15 live right here on c-span2. booktv presents a live webcast this afternoon with author timothy gay. the book is called "assignment to hell," it's a history of

american war reporting during world war ii. he follows walter cronkite and andy rooney as they travel through the war. lye coverage begins at 6:30 p.m. eastern online at booktv.org. >> i think this is one of those markets that i think people vote for the, um, don't vote for the party. i think this is the city of wichita votes for the candidate. i think you're seeing a lot more of that. even though this is heavily republican midwest which is dynamic, and it's great, but i think you're seeing more of that in the recent years here in the midwest. they are really voting a little bit more for what the person stands for. >> june 2nd and 3rd booktv and american history tv explore the heritage and literary culture of wichita, kansas. >> the first place i want to show you is the monger house, and it is the only remaining original structure from the 1865-1870 time. and it was a very important building in our history in that it is a residence, but it's also

the headquarters of the wichita town and land company that came down here to create, shall we say, the city of wichita. >> be watch for booktv and american history tv in wichita on june 2nd and 3rd on c-span2 and 3. securities and exchange commission chair mary schapiro told the senate banking committee today that they found out about jpmorgan chase's over $2 billion in losses through media reports. the firm reported it has on may 10th. ms. shapiro says the sec is focusing on whether the firm's financial disclosure and reporting were accurate. here's a portion of her comments today before the committee. >> chairman johnson, ranking member shelby and members of the committee, i appreciate the opportunity to testify regarding the securities and exchange commission's ongoing implementation of title vii of the dodd-frank act. as you know, title vii creates an entirely new regulatory

regime and directs the commission and the cftc to write a number of rules necessary to implement it. of course, title vii is just one of the many areas ranging from credit rating agencies to private fund and municipal adviser registrations where the sec is charged with writing rules. the sec already has proposed or adopted rules for over three-fourths of the more than 90 provisions in the dodd-frank act that mandate sec rulemaking. additionally, the sec has finalized 14 of the more than 20 studies and reports that the dodd-frank act directs us to complete. and the commission has proposed almost all of the rules required by title vii. we're continuing to work diligently to implement all provisions of title vii as well as the many other rules we are charged with drafting and to coordinate implementation with the cftc and other domestic and foreign regulators. under the dodd-frank act regulatory authority over swaths is divided between the cftc and

the commission. the law assigns the sec the authority to regulate security-based swaps while the cftc has primary regulatory authority over the bulk of the title vii over the the counter derivatives markets. our rule makings are designed to reduce asymmetries and facilitate the centralized clearing of security-based swaps to reduce counterparty risks. they are also designed to enhance investor protection by increasing disclosure regarding transactions and mitigating conflicts of interest. by promoting transparency, efficiency and stability, this framework is intended to foster a more stable and competitive market. in implementing title vii, sec staff is in regular contact with the staffs of the cftc, the federal reserve board and other financial regulators. in particular, commission staff has coordinated extensively with cftc staff in the development of the definitional rules including joint rules for the defining key

product terms which we expect to finalize soon and rules further defining categories of market participants which we adopted last month. although the timing and sequencing of the cftc's and the sec's rulemaking may vary, they are the subject of extensive interagency discussions and the objective of consistent and comparable requirements will continue to guide our efforts. the dodd-frank act also specifically requires that the sec, the cftc and the prudential regulators consult and coordinate with foreign regulatory authorities on the establishment of consistent international standards. accordingaccordingly, we're woro address the foreign regulators to develop rules and standards complementary to our own. the commission expects to complete the last of the core elements of our proposal phase in the near term. in particular, rules related to the financial responsibility of

security-based swap dealers and major security-based swap participants. the commission is finalizing a policy statement regarding how the substantive requirements under title vii within our jurisdiction will be put into effect. this policy statement will establish an appropriate and workable sequence and timeline for the implementation of these rules. as a practical matter, certain rules will need to go into effect before others can be implemented, and market participants will need a reasonable but not excessive period of time in which to comply with the new rules. this statement will let market participants know the commission's expectations regarding the ordering of the compliance dates for various rules. relevant international implementation issues will also be addressed in a single proposal. finally, your invitation letter requested that i address recent trading losses reported by jpmorgan chase. our best information is that the trading activities in question took place in the bank in london

and perhaps in other affiliates. but not in the broker-dealer that is directly supervised by the sec. although the commission does not discuss investigations lickly -- publicly, i can say in circumstances of this nature where the activity does not appear to have occurred in if one of our regulated entities, the sec would be primarily interested in and focused on the appropriateness and completeness of the entity's financial reporting and other public disclosures. in many -- in conclusion, we look forward to continuing to work closely with congress, our fellow regulators both at home and abroad and members of the public. thank you for the opportunity to share our progress on the implementation of title vii, and i will, of course, be happy to answer any questions. >> thank you. chairman gensler, please, begin your testimony. >> good morning, chairman johnson, ranking member shelby and members of this committee. i'm pleased to testify along with sec chairman zap row. i'm going to speak to the three

topics of your invitation letter. first, where's the cftc on swaps market reform. sec, the cftc's role in overseeing markets for credit derivative products such as those traded by jpmorgan chase's chief investment office, and, third, international progress on swaps reform and related issue ofs of cross-border application. i also welcome ranking member shelby's questions and look forward to chatting about that in public as i would in private with any of the members. the cftc is a small agency that's tasked with overseeing the futures markets and now with passage of dodd-frank a market nearly eight times larger, the swaps market. given these new responsibilities, we're significantly underfunded, but you've heard me say that before. our market oversight critically relies on market participants foremost complying with the laws and related rules, and then the self-regulatory agencies like the cme and the national futures association that provide the first line of oversight.

but in addition to that, we do rely on promulgating and implementing rules, and in that context the cftc has completed 33 swaps market reforms today. we have just under 20 to go. what do they do? they bring transparency to this marketplace. secondly, they lower risk through something called central clearing of standardized swaps, and thirdly, lower risk by comprehensively regulating the dealers. we are on track to finish the reforms this year, but it's still very much standing up, and we are also giving the market time to phase in implementation to lower the cost and burden on this very significant transition. to increase market transparency, we've completed eight key reforms including realtime reporting to the public and to regulators that will begin later this summer. when clearing, we've finalized risk management and will soon seek public comment on which contracts themselves would be under what was called the clearing mandate.

to promote market integrity, we've completed strong anti-fraud and anti-manipulation rules as well as aggregate position limits, and we're looking soon to finalize the end user exception be. to lower risk of the swap dealers posed to the economy at large, we've completed rules providing risk management and a joint rule with the sec on a further definition of the word swaps dealer and securities-based swap dealer. all of this is pending because it has to finalize the further definition of the term "swap" and "securities-based swap." it is essential that the two commissions move forward expeditiously to finalize this rule, and i'm glad to say that both commissions now have a draft of this rule that's been worked out through staff and, hopefully, we'll be able to finalize this in the near term. we've made significant progress working with nestic and foreign regulators to bring a consistent reproach to swaps market reform.

europe, japan and canada now all have made real progress legislatively and now in rule writing to bring similar reform, and in particular i want to say we're working on a consistent approach to global margin for uncleared swaps. it's important for a lot of reasons, but let me note one reason is that the cftc proposed rule that did not require financial end users to post margin, and we're advocating the same globally. i just wanted to make sure people know that in the end user community. the commission's also working on a balanced approach to cross-border application of swaps reform. i think congress was guided by the experience of aig with its london affiliate. well, actually, it was a london branch. lehman brothers, citigroup, bear stearns and even long-term capital management when it applies reforms to transactions that might be booked offshore but nonetheless have a direct and significant effect on u.s. commerce and activities. that, in essence, is a stark reminder we got in the last two weeks when jpmorgan's trading

losses were overseas from trades that lost multibillion dollars in the credit default swaps and indices on credit default swaps. the cftc has an open investigation related to derivative products traded by the chief investment office, and although i am unable to provide specific information about a pending investigation, i will touch upon the commission's role this overseeing these markets. the cftc has oversight and clear anti-fraud and anti-manipulation authority regarding the trade of credit default swaps indices. we also oversee the clearinghouses that already clear some of these products. starting this summer, there'll be realtime reporting to the public. and later this year but not yet, we envision the dealers themselves to begin to register, and that trading will commence on swap execution facilities. so we're in the midst of implementation that will take still some time. in conclusion, though, we've

made great progress in bringing common sense reforms to the swaps market. it's critical we complete these reforms for the protection of the public. thank you. >> i would like to thank both of our witnesses for their testimony as we begin questions. i will ask the clerk to put five minutes on the clock for each member. chairman gensler and schapiro, what role do your agencies have in monitoring the swap trades at issue in the jpmorgan matter, and were any concerns raised about these trades at east -- at either of your agencies? what changes will the derivative reforms bring to the regulation of these types of of trades, and what are their potential implications for the volcker rule? chairman gensler, please, start. >> be um, as i mentioned in more

depth in my written remarks, we're in the midst of standing up a regime that will still take some time. but the credit default swap indices, these are parts of the products that reported in the press that jpmorgan chase's chief investment office was trading, already come under our completed anti-fraud and anti-manipulation regime, and the clearinghouse -- three of them, actually -- already clear credit default swap indices. voluntarily later this year we anticipate seeking public comment on actually having a clearing mandate so that more of these trades will come into the clearinghouse. currently, it's just dealers to dealers. later this year we'll have a regime that i actually think dealers will start to register. but this bank was not yet registered as a swap dealer because we don't yet have complete rules to make that a true being. and later this year, maybe into 2013, you'll start to see the commencement of trade in

transparent markets. we're not trying to do this against a clock. we're trying to get it balanced. i know that congress gave us one year to get the job done, and we're pushing on two years. i do think we need to get the job done to better protect the american public. but at the same time take in the 30,000 comments we've received. you asked when did it come to our attention. with matters like this, i don't want to get into the specifics of an investigation, but as press reports have shown, these are indices that are under our jurisdiction and the clearinghouses we monitor on a very realtime, daily basis for the completeness of the margin and the safety and soundness of the clearinghouses. >> chairman schapiro? >> thank you, mr. chairman. to the best of our understanding, none of the transactions were held in or executed in the u.s. broker-dealer. the activity took place in the loan bonn branch of the occ-regulated bank and in a

london-based affiliate investment management unit. so the sec did not have any direct oversight or knowledge of the transactions. i would reiterate what chairman gensler said. if the dodd-frank rules had been in place when the activity was going on, these positions likely would have been all been cleared, some substantial majority or some substantial number were, but not all were cleared. they would have likely been exchange traded. they would have been report today a swap's data repository, and there would have been detail transparentty to the regulator and the public. and i would say under the sec's proposed rules for reporting, we would have known the trading desk and the trader as well who put the positions on. the dealer would have been registered and subject to business conduct standards. and they would also operate under the new rules for enhanced prudential supervision for bank holding companies with assets greater than $50 billion.

so i think there are a number of pieces that would be in place once all the proposals to implement dodd-frank are completed. >> chairman schapiro, can you commit to us that the sec will issue the last of your proposed derivatives rules in the coming months and that you will prioritize within the sec the importance of enacting the final rules in a timely manner? >> absolutely, mr. chairman. we have the last piece of proposing rules, also the financial responsibility rules for swap dealers and major swap market participants. i hope that we will issue that in the next couple of months. there also are the two other key pieces from the ce is the's -- sec's perspective. one is the implementation plan we'll lay out in a poll statement our views on how the rules should be sequenced implemented, what the compliance

timelines should look hike. and finally, a cross-border release that will talk about the application of each of our rules potentially to, um, cross-border activity or cross-border operating entities. and we want to propose that cross-border release before we adopt final rules beyond the definitional rules. >> senator shelby. >> thank you, mr. chairman. a lot of people have been, basically, saying that, chairman gensler, that the cftc and the sec, chairman schapiro, were in the dark. that you didn't really know what was going on at jpmorgan. we don't know that yet. but when did you first learn about these trades, chairman gensler? >> um, i would say that the trades came to, i think, many of our attention, personal attention with press reports --

>> press reports. >> but our staff was aware of trades that are in the clearinghouses because they monitor the clearinghouses daily in an aggregate basis for the clearinghouse risk and that the clearinghouse is fully, um, clerking margin to protect the risk -- collecting margin to protect the risk of the clearinghouses. again, we don't regulate jpmorgan chase as a swap dealer yet, but we do regulate the clearinghouse and then have anti-fraud -- >> did the cftc really know what was going on there on such a large position that jpmorgan had taken here? >> well, again -- >> were you in the dark, or did you know what was going on? you said you learned about -- >> i would say that it's in transition, to speak about this. our oversight of the clearinghouses give us a lot of window into the clearinghouses which i think has 27 members in it and the risks that are in that clearinghouse.

and the margin that's collected there. that's not the full jpmorgan picture, of course, because they have a lot of swaps that aren't cleared. that would have been our principle regulatory -- in terms of the bank, we don't have any -- >> so you really didn't know what was going on or the problem with the trade until you read the press reports like all of us? >> well, that's what i've said, yes, sir. >> yes, sir. >> yeah. >> chairman schapiro, pose the same question to you. >> chairman -- >> where was the sec here? did they know what was going on? and if not, why not? >> we became aware of the activity also through press reports back in london when it was first reported on this. to remind everyone, this activity did not take place in a broker-dealer, and we do not have oversight responsibility over the broad-based cds index products that were the summit of much of the trading -- subject of much of the trading, although i think there's still much to

learn here about the full -- >> and what was your responsibility be as you see it as chairman of the sec looking at what happened to try and find out what happened at jpmorgan chase? what's your responsibility? >> clearly, our focus right now is on whether the company's public disclosure and financial reporting is accurate in light of, um, what the press has teed up as what did they know and when did they know it. >> absolutely. >> so there were -- >> and if they knew, if they knew something, say, a month earlier that was going wrong, should they have disclosed that to the sec, the cftc? and is that what you're trying to find out now, or do you already know? >> that's what we're investigating right now. their earnings release statements and their q1 financial reports, um, are they accurate and truthful. >> but you're in the investigation of that now. >> yes, sir. >> what did they know inside,

when did they know it and what should they have divulged s that correct? >> exactly. >> is that correct, chairman? >> yes. and as congress gave the cftc similar authority to the sec, we didn't formally have a strong anti-fraud and anti-manipulation authority which included also deceptive practices. that's or part of this new authority that we have, and so we have currently oversight of the clearinghouses and then, of course, this one -- >> capitol hill testimony from earlier today. you can see all this hearing in the c-span video library. go to c-span.org. live, now, to the u.s. senate. lawmakers returning from their weekly party lunch meetings to continue debate on extending a food and truck administration user fee that funds fda reviews of prescription drugs and medical devices. and now, live toth the senate floor. the clerk will call the roll. mr. reid: we have harkin and murray but they're not here.

mr. alexander: i was going to defer to senator harkin and senator murray. mr. reid: they obviously are not prompt, like you and me. mr. alexander: [laughter] well, we have good habits. mr. reid: it's the senator's choice as to whether he wants to wait for them. please go ahead. mr. alexander: all right. thank you. i thank the majority leader. the presiding officer: the senator from tennessee. mr. alexander: mr. president, i will. we are -- and i thank the majority leader for bringing this bill up. he and the republican leader have put on the floor a piece of legislation that affects nearly every american family. now, this won't have the fire works that some things we do has because we have a lot of agreement about it which is one reason it's on the floor. it's gone through the committees. senator harkin and senator enzi have worked carefully with all the republicans, all the democrats on the committees and many other people on a complex piece of legislation for a year to put on the floor legislation

that would help made and food and drug administration safety and innovation act a bill that's likely to succeed. we take for granted our medicines, mr. president. during the civil war, the capital was -- the capitol was used as a hospital, this capitol. 2,000 cots were set up in the house and senate chambers and the rotunda. the first group of wounded arrived from the second battle of bull run and later from antietum in september in 1862. those soldiers didn't have the benefit of antibiotics or or modern medicine as that we take for granted today and that is why there was such a whole number of deaths in the civil war. still, as the 20th century dawned, disease cast a long shadow over the united states of america. a child born in 1900 could expect to live an average 47 years. and infectious diseases took many children before they reached their teens. in 1900, pneumonia and influenca

were the leading causes of death, followed by to clerk loases and do rea -- tuberculosis and diarrhea. physicians have few weapons to fight diseases. the medicines at the time included such things as mercury for syphilis and ringworm, digitilis and quie nine for malaria, plant-based pergatives. for most of history, diabetes meant death but insulin was introduced in 1923 commercially and within a few years, enough insulin was being produced to meet the needs of diabetes patients around the world. it is hard to remember this but vaccines began to be commercially produced only during the time of world war i and it was not until the time of world war ii that we saw the introduction of widespread and effective therapies with the development and mass production of penicillin. and since then, the sky has

seemed to be the limit. half of americans take at least one prescription drug everyday. one in six take three or more. and many take over-the-counter medicines. it is a real miracle what has happened in terms of our lives with the introductions of medicines. and we rely upon the food and drug administration to keep those medicines safe and effective, which is what this legislation is about. i would like to renew my compliments to senator harkin and senator enzi for bringing this bill to the floor in a condition where they have already worked out most of the issues. this bill is complex, it's long. it has 11 titles. it will help safe and effective drugs. it will make medical devices and biosimilar products get to market. and, more important, get them to the market quickly so people who need help can use the medicines.

we're reauthorizing two user fees. these things have absurd names like the prescription drug user fee act is called pdufa and the medical device user fee modernization act is called mdufa. and there are two new ones which are gdufa and psufa. these are absurd and i promise never again to use those phrases for these user fee programs, but they're critically important programs that give the food and drug administration needed resources to review new medically necessary products. for example, there's the better pharmaceutical for children children's act. it's a part of what we're doing this week. i've worked on it, cosponsored it with senators reed of rhode island, murray and roberts, and i thank them for the ability to work with them on this. this makes permanent the best pharmaceuticals for children act

and the pediatric research equity act is reauthorized. one is an incentive and one requires pharmaceuticals to -- when they -- when they develop new drugs for adults, they figure out the effect that those drugs will have on children. too often we don't know the answer to that and the drugs are either ineffective or -- or -- or can have bad results sometime. this is a very important part of the bill. another important part of the bill has to do with medical devices. the united states is a world leader in medical devices. in tennessee, we have lots of them, especially in memphis. we need to improve the regulatory process. there are many who believe the f.d.a. is overregulating medical devices. that has a negative effect on the industry's ability to raise capital, create jobs, doesn't make those devices available, most importantly, in the u.s. and in europe. this will help address those

problems. for example, it will allow customization of medical devices for small populations. that means five people or less without going through a very burdensome approval process. and it changes the humanitarian device exemption to encourage and incent the development of devices to treat patients with rare diseases. that would be groups of patients of less than 4,000 people. there's another problem that's addressed in this legislation. it's the generation of antibiotic -- dealing with antibiotic resistance. we know there's a growing problem with resistance by -- as bacteria continuously mutate and involve in their resistance to the drugs and the medicines that we -- we develop. and while efforts have been made to preserve existing antibiotics, drug development hasn't kept up with the pace. these changes will provide

meaningful market incentives and reduce regulatory burdens. in addition, i'm very pleased with the results of our work on drug shortages on -- on dealing with drug shortages that. is a part of this bill. it will give the f.d.a. additional tools to help prevent drug shortages and require f.d.a. to look internally at regulations to see if the f.d.a. is making the problem worse. senator casey and i worked together on a review of federal initiatives to combat prescription drug abuse and to issue a report on that. tennessee, our state ranks second in the nation for prescription drug use. our governor, bill haslem, and our legislature took action this year to deal with that. we intend to help them. in closing, i'd like to commend senators harkin and enzi. i see the senator from washington on the floor. i don't want to take much more time because i know she's about to speak. she's been integrally involved

in the development of this legislation over -- over the last year, especially the better pharmaceuticals and devices for children act. i mentioned that a little earlier. it incentivizes drug users to study their products and how they affect children and, in return, they get to keep the exclusive use of those products for a little while longer. that means they don't go to generics quite as quickly. that has been tried in this legislation since it was first authorized and reauthorized and reauthorized and it has worked. it has been a very good example of an innovation in legislation that has achieved the desired result. the pediatric research equity act gives the f.d.a. authority to require pediatric studies in some cases and then to do the same by promoting the

development of pediatric medical devices. so the importance of the legislation is it takes a big step forward in making it clear what drugs that are created for adults will do when offered or provided to children. currently, just under half of the drugs prescribed to children have been studied and labeled for children, but that's a significant improvement over where we were when these programs started just a few years ago. children's bodies react very differently to medicines. sometimes side effects are different. physicians have to guess what dosages are appropriate, whether a therapy is -- that might be effective for an adult is also effective for a child. sometimes there are examples of of -- of overdosing or previously unknown side effects. in one case in tennessee in

1999, tennessee -- seven babies were prescribed an antibiotic to treat whooping cough. they became so seriously ill, they needed stomach surgery. and the c.d.c., center for disease control, later linked their illness to the antibiotic which had never been tested in young children. prior to the passage of these laws that we're working on today and reauthorizing, 80% of drugs used for children were used off label. that was, we didn't really know how they affected children. now we can use those drugs, half of our drugs today, safely and effectively because we do know know -- we do know that. so i'm happy to come here today to -- to join with senator murray, senator harkin, senator enzi, senator reed of rhode island, senator -- senator

roberts to offer what i believe is a piece of legislation that affects every american family. it takes one more step in the dramatic story of how we have gone from a country with almost no medicines to a country where almost everyone takes some medicine and a situation where -- where the lifetime of the average american has increased from 47 years of age to its present level today. i see the senator from washington on the floor. i want to recognize and thank her for her leadership on the legislation. mr. president, i yield the floor. mrs. murray: mr. president? the presiding officer: the senator from washington. mrs. murray: thank you, mr. president. and i, too, want to thank the senator from tennessee, as he referred to how we worked together on a bipartisan basis on the better pharmaceuticals and devices for children act, a very critical piece of this legislation that i will talk about in just a few minutes as

well. but i want to thank him for working with us. and really, i want to thank all the senators who worked very hard on this piece of legislation. working with stakeholders and advocates for over a year on the bill that will be on the floor later this afternoon. i really want to commend chairman harkin as well as ranking member enzi for working together in a bipartisan fashion to get this to the floor today. -- this bill to the floor today. and i hope all of our colleagues really understand the critical importance of moving forward with this bill as efficiently as possible, because, as many people know, if we do not make this legislation a priority, by the end of september, over 2,000 employees at food and drug administration are going to be sent packing with pink slips. but what's just as important, if want more important, is failure to pass this legislation will put drug and medical device approval at a standstill. that will not only halt innovation but it will put the lives of many americans at risk

while they wait for potentially lifesaving medicines. no one knows that more -- the importance of that -- than seattle genetics, a company in my home state of washington. in august of last year, the seattle genetics received f.d.a. accelerated approval of a drug intended to treat hodge kin lymphoma, the first of its kind approved by the f.d.a. in more than 30 years. as a biotech company, seattle genetics' relationship with the f.d.a. was really vital to the work they were doing to bring this drug to patients who were in need. ultimately, seattle genetics received f.d.a. approval 11 days earlier than expected and that meant they were able to anticipate the timing of its approval, organize their sales teams and ship the first business day following approval for a patient already waiting for that critical drug. mr. president, that kind of

collaboration would not have been possible had the f.d.a. lacked the resources necessary to make it a reality. and i believe that clay segal, who's the president and c.e.o. of seattle genetics, was truly able to underscore the issue of what we're discussing here today -- and i want to tell you what he said -- and i quote -- "it is only through working with an f.d.a. that has the resources and dedication to achieve thorough and timely reviews that we are able to fulfill our promise to improve the lives of people through innovation." passage of this bill helps to provide both the resources and incentives for f.d.a. to rapidly review and approve important therapeutic breakthroughs for patients in need. that highlights the importance of this legislation, mr. president. but i also want to highlight another part of this bill that i've been very focused on, that the senator of tennessee just talked about, and that is the need make sure that drugs and medical devices are specifically

tested and labeled and proven to be safe and effective for our children. this is so important for families and doctors across america, so i really want to thank chairman harkin as well as ranking member enzi for including my bill, the better pharmaceuticals and devices for children act in the legislation that we are considering today. i was very proud to work with senator alexander along with senators reid and roberts to put together in commonsense legislation. this bipartisan language will make sure our children are prioritized in the drug development process and that drug labels provide clear, detailed information about the proper use and dosage of medications for children. it will give parents and doctors more information and make sure the key programs we count on to protect our children do not expire. and it'll push to make sure children are never just an after-thought when this comes to

the safety and effectiveness of our nation's drugs and medical devices. so, mr. president, as you have heard here today, this is a bill that has received bipartisan support. i want to commend all the senators who have worked on this in a bipartisan way. we don't get credit enough for that here in this country. but this is certainly one where everyone came together worked together in our committee, and this bill really holds the livelihood of so many americans in its balance. i urge the senate to move forward quickly and support the legislation and get it passed. thank you, mr. president. i yield the floor, and i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

the presiding officer: the senator from illinois. mr. durbin: i ask that the quorum call be suspended. the presiding officer: without objection. mr. durbin: i ask unanimous consent to speak in morning business. the presiding officer: without objection. mr. durbin: is 1 years ago i introduced the dream ablght, legislation that would allow a select group of immigrant students with great potential to contribute more fully to america. the dream act is not an amnesty bill. it would give students a chance to earn legal status in america. and there are standards that they have to live up to. one, they came to the united states as children. nornumber two, they've been long-term united states residents. number three, good moral characteristic. number four, graduate from high school. and, number five, either serve

in america's military or complete two years of college. the dream act also includes important restrictions to prevent abuse. under the dream act, no one would be eligible for pell grants or any other federal grants when they went to the school, and individuals who commit fraud under the dream act -- who lie, misrepresent their status -- would be subject to tough fines and criminal penalties including a prison sentence of up to two years. it is serious. no one would be eligible for the dream act unless they arrived in the united states at least five years before the bill becomes law. ness no exceptio -- there is non and no waiver. my colleague from florida, senator marco rubio, said in a recent speech that the dream act is not an immigration issue; it's a humanitarian issue. i might add that i think it is an issue of justice. thousands of immigrant students

in the united states were brought here as children. they didn't make a decision at the age of two to come to america. it was not their decision come to here, but they grew up here. they went to school here. they stood up in classrooms across america, pledging allegiance to the only flag they ever knew, singings "the star spangled banner" believing they were part of america. the fundamental presiden premise dream act is that we shouldn't punish children for their parents' actions. it is not the american way. the dream act says to these students, we're going to give you a chance. now, these dreamers -- and i have come to know them -- don't want a free pass. all they want is a chance to earn their place in america. that's what the dream act would give them. the dream act just isn't the right thing to do. it the would make america a stronger country by giving these talented young people a chance to serve in our military and to contribute to our future.

tens of thousands of highly qualified, well-educated young people would enlist in the armed forces. that's why we end up with the support of people like general colin powell. here is a man who has given his life to america and the security of america. he says the dream act is the right thing to do for the future of america. the studies found deem act participants would contribute literally trillions of dollars to the u.s. economy during their working lives. you might wonder how an idea like that ends up becoming a bill and being debated not only on the floor of the senate and the house, but becoming a subject of debate in the presidential contest now going on. it started with a phone call, a phone call to my office about 11 years ago from a woman named duffy adelson. duffy is the director of the merit music program in chicago. the merit music program is an

amazing program which offers to children in the public schools of chicago an opportunity to learn to play a musical instrument. that program goes to the poorest schools and asks children if they're interested, if they would like to have an instrument and a chance to learn. the children sign up, and amazing things happen. these kids, 100% of them end up in college. that's what that one life experience of learning to play music can do. she called me about a young girl. she was a korean. she had been brought to america at the age of two. her mother and father became citizens. her two brothers -- her brother and sister born here were automatically citizens, but she was not. she joined the merit music program and turned out to be an accomplished pianist to the point where she was graduating high school and was being

offered scholarships to the best music academies in the united states. when her mom sat down with her to fill out the application, there was a little box that said citizenship. and she turned to her mom and she said, so what do i put there? her mom said i brought you here at the age of two on a visitor's visa, and since you were a little baby i didn't file any more papers. i don't know what you should put there. the girl said what are we going to do? and her mom said we're going to call durbin. so they called my office, and we checked the law, and the law turned out to be pretty harsh. the law said that this 18-year-old girl who had never lived, to her knowledge, any other place but america, had to leave america for ten years and then apply to come back. it didn't seem right. she came here at the age of two. she had done nothing wrong. so i introduced the dream act. well, here's the rest of the story about this young lady whose name is theresa lee.

terasa lee did go to the manhattan conservatory of music. when she went there, she turned out to be just as good as the merit music program thought she would be. she progressed to the point where she literally played in carnegie hall, and she found a young man, they fell in love, they got married, and she became a citizen by virtue of that marriage. she is now working toward a ph.d. in music. she is a brilliant young woman. there was a talent that would have been lost to us and lost to the future if we would have just followed the strict standards of the law at that moment. but we didn't. we said give her a chance, and she proved herself. she proved that she's a quality individual. when i introduced the dream act, it was a bipartisan bill. there were republican senators who actually debated me as to who was going to be the lead sponsor on the bill, they thought it was such a good idea.

the dream act has a history of broad bipartisan support. when i introduced it with senator orrin hatch of utah, he was chairman of the judiciary committee and he was the lead republican sponsor. when the republicans controlled the senate, the dream act was reported by the judiciary committee on a 16-3 bipartisan vote, and on may 25, 2006, six years ago this week the dream act passed the republican-controlled senate on a 62-36 vote as part of comprehensive immigration reform. that bill, unfortunately, did not pass. unfortunately, the republican support for the dream act has diminished over the years. the last time the dream act was considered on the floor of the united states senate in 2010, the bill had already passed the house and received a strong majority vote there, but only eight republicans supported it in the house and only three republicans in the senate. a bill which had been so bipartisan and so popular was now becoming each time we called it more partisan.

the bill hadn't changed. politics have changed. the vast majority of democrats in the house and senate continue to support the dream act. the reality is we can't pass the bill without substantial support from my colleagues on the other side of the aisle. that's why i've always said i am open to working with anyone, republican or democrat, who is interested in working in good faith to solve this problem. i'll never close the door on the possibility of providing assistance to these dream act students. i've come to the floor almost every week for the last several years to tell the story of another young person who would qualify under the dream act. today i want to tell you the story of saheed lemone. saheed was brought to the united states from bangladesh in 1991 at the age of nine. he grew up in durham, north carolina. his dream was to become a doctor. he attended southern high

school, a prestigious magnet school for young people interested in health care. he was a member of the national honor society and won his high school's diamond in the rough scholarship award. one of saheed's teachers said in the classroom he was kind, very respectable and responsible. he showed great interest in a career in medicine. in the medical community through shadowing experiences, saheed was professional, highly motivated and caring with patients. saheed didn't learn about his immigration status until his senior year in high school. he went on to graduate from east carolina university with a bachelors of science in biology with a concentration in microbiology. understand he didn't qualify for any federal loans or federal grants. it wasn't easy to get through college under those circumstances. during college saheed served in underserved rural areas in north carolina and it made a big impression on him.

in his application for medical school he wrote i was surprised to see so many people would line up during a cold winter morning just to know if they were healthy or not. seeing their dedication and patience influences me every day to work my hardest in order to meet my personal goal: becoming an exceptional physician. that was seven years ago, 2005. today saheed is 30 years old. he's been unable to attend medical school because of his immigration status. since he graduated from college, he has volunteered with the health clinic in raleigh that serves low-income patients. he has tutored elementary school students to help develop their interest in science, but his personal dream of becoming a doctor has not become a reality. some of my colleagues have criticized the dream act because people under the age of 35 are eligible. they say that only children should be eligible for the dream act. but this ignores the obvious. every year we wait, those children grow a year older.

in order to qualify for the dream act, an individual must have come to the united states as a child, as saheed. today he's 30. that doesn't change the fact that he was brought here when he was nine years old. it doesn't change the fact that he has lived in the united states virtually all his life. and it doesn't change the fact that he should not be punished for the choices his parents made. saheed was 19 years old when the dream act was first introduced. why should he be penalized bass i can't pass -- because i can't pass the bill. i keep trying. congress doesn't get it done. does that mean his life should be wasted? last year saheed was arrested by immigration agents and placed in deportation proceedings, despite the fact that he's lived in the united states for 21 years, since he was nine years old. he was held in a county jail with violent criminals.

saheeed has never committed a crime in his life. saheed sent me a letter and here's what he said about the experience of being in jail and facing deportation: i live my life by the law, did everything by the books, never committed any crime and somehow ended up in jail over something i had no control over as a child. what would i do if i were sent back to bangladesh? i barely speak the language and i don't know how to read it or write it. how am i supposed to start my life all over from scratch in such a place without knowledge of the language or the culture? my office learned about saheed's case. we contacted immigration and customs enforcement and asked them to consider his request that his deportation be placed on hold. the obama administration placed a stay on his deportation proceedings. however, it's only temporary. it doesn't give him permanent legal status, and he's still at risk of being deported sometime in the future. the only way for saheed to be

permitted to stay in the united states permanently is for us to do something, to pass the dream act, to change the law. in his letter to me, saheed explained what the dream act meant to him. the dream act means being able to be home regardless of where we go, we all yearn to come back to our home. to me, north carolina is that home. i watch live on c-span in 2010 as the bill passed the house but failed to pass the senate. to most of the senators, it was just another bill that was rejected. however, to someone like me, whose life not only depends on something so crucial, but my future literally hangs in line, it's absolutely devastating to witness this rejection. i hope this is the year that politics are set aside and all the representatives can work together for a solution. saheed's right. those of us who are fortunate enough to serve in congress have an obligation to set politics aside, set party aside and do the right thing. this isn't a democratic issue or

a republican issue. we're going to be a stronger and better country if we give saheed a chance to earn his way toward american citizen. this is not just one example, one person. there are literally thousands just like him waiting for their chance. the dream act would give sah eed and other bright, accomplished, ambitious young people like him the opportunity to become tomorrow's doctors and engineers, teachers and soldiers. today i ask my colleagues again, as i have so many times before, to support the dream act. let's give saheed and so many other young people like him a chance to contribute more fully to the country they call home. it is the right thing to do, and it will make america a stronger nation. mr. president, i ask consent that my remarks that follow be placed in a separate part in the record. the presiding officer: without objection, so ordered. mr. durbin: mr. president, two weeks ago we were given a cautionary lesson about the need

to ensure that our nation's banks are carefully regulated. we're still learning the details about the $2 billion bad bet made by banking giant j.p. morgan chase. what we've learned is disturbing. apparently the london office of this wall street giant crafted a credit derivative trading strategy that spun out of control over six weeks. at the center of the strategy was one single trader who was nicknamed -- quote -- "the london whale." one trader, six weeks, $2 billion gone. it's not clear how widely the repercussions of this trading loss will extend, but this incident clearly is an important reminder to all of us. it reminds us we can't afford to take a hands-off regulatory approach to the giant financial transactions on wall street. these institutions drove this nation to the brink of economic disaster just a few years ago. if they're simply left to their

own devices, it could easily happen again. we need reasonable financial regulation that will ensure transparency, competition and choice. and we need to prevent wall street banks from fixing the rules and setting up rigged schemes that line their own pockets and hang main street america out to dry. two years ago congress passed and the president signed the dodd-frank wall street reform and consumer protection act. this legislation took on the challenge of placing a reasonable regulatory framework on wall street. it's a tough challenge. wall street and the banking industry have enormous resources and enormous power, and they're not afraid to use it not only on wall street, on capitol hill. in the days to come, we're going to see important regulatory efforts proceed on issues like the volcker rule, which deals with the big banks' ability to make bets with their customers' money. it's important that we pursue this regulatory effort

diligently. we can't let the big banks use their threats and scare tactics to water down reform and to preserve business as usual. there's too much at stake. i want to talk today about another part of wall street reform that passed two years ago, a provision that the big banks hate as much as any other. i'm talking about the provision i wrote dealing with interchange fees or swipe fees. mr. president, the swipe fee is a fee that a bank receives from a merchant, a restaurant, a retailer, when the merchant accepts a credit or debit card that was issued by a bank. that fee is taken out of the transaction amount. if your bill is $50 at the restaurant, that includes the fee the restaurant is paying to the bank and credit card company called the swipe fee, the interchange fee. the vast majority of bank fees are very transparent and competitive. chase, bank of america, wells

fargo and the rest set their own fee rate and compete for business based on the fees they charge. but that's not the case with the swipe fees and interchange fees that affect credit and debit cards. the big banks know competition and transparency help keep fees at a reasonable level, make it harder to make big money off the fees. that's why they set up the swipe system, the interchange system, to avoid competition in transparency. the big banks decided that rather than each setting their own swipe fees, they would just designate two giant card companies, visa and mastercard to set the fees for all of them. that way each bank could get the same high fee on each card transaction, no high competition. then the banks buried this swipe fee under layers of complexity with debit and credit transactions. most consumers and even most merchants still have no idea how much they are being charged on the swipe fee. this system helped the card-issuing banks do very well over the last 20 years.

u.s. swipe fee rates became the highest in the world, and they kept going up even as the cost of processing transactions went down. debit swipe fees alone, just debit cards, brought the banks over $16 billion in the year 2009. that's the interchange fee paid by the merchants, ultimately by the consumer, to the banks and credit card companies when people use a debit card. of course, banks don't need all this debit swipe fee money to conduct debit transactions. the actual cost of the transactions is very low, just a few cents. but the banks looking for more revenue exploited the swipe fee system to charge far more than they could ever justify. it doesn't have to be this way. many other countries, canada, european countries, have vibrant debit card systems with swipe fees strictly regulated or prohibited altogether, and in the united states, debit swipe fees used to be tiny until visa

took over the debit card market in the mid 1990's and used tactics that i think boarded on violations of antitrust. by 2010, the u.s. swipe fee system was growing out of control with no end in sight. there were no market forces serving to keep fees at a reasonable level. merchants and their customers were being forced to subsidize billions in windfalls to the big banks. that's when i introduced an amendment, the wall street reform bill, that for the first time placed reasonable regulation on swipe fees on debit cards. the reason i picked debit cards is some of us are old enough to remember something called a checking account. those checking accounts are still around, but they're rare. most people do their checking transactions with a piece of plastic called a debit card. the money comes directly out of your bank account, just as the check removed money directly from your bank account. that's why the debit card is a different transaction than the credit card. my amendment said that if the

nation's biggest banks are going to let visa and mastercard fix swipe fees for them, the rates must be reasonable and proportional to the cost of processing a transaction. there would be no more unreasonably high debit swipe fees for big banks. my amendment also included a nonexclusivity provision which aimed to stop visa from taking over the debit card market entirely. this provision says there needs to be a real choice of card networks, real competition. the regulatory steps my amendment proposed were modest. most other countries have gone a lot further in regulating their credit and debit systems. but if you listened to the banking industry and card companies, you would have thought my amendment would be the end of the world as we know it. they made outrageous claims, the regulation of swipe fees would kill the debit card system, devastate small and community banks and particularly be an end to credit unions and cause banks to raise their fees on

consumers. my amendment passed the senate with 64 votes signed into law and it's been eight months since the swipe fee reform took effect. well, it turns out all the scary scenarios threatened by the banks have not come to pass. first, the banks claimed it was impossible for visa and mastercard to establish a new tier of regulated swipe fee rates. as it turned out, creating this two-tiered system was easy. there were already hundreds of rate tiers so adding another one wasn't difficult. the banks then claimed that small banks and credit unions would be hurt by reform even though all institutions with a value of less than $10 billion were exempt. as it turned out, small banks, community banks and credit unions actually thrived since this reform took effect. why? because under my amendment, small banks and credit unions can receive the higher interchange fees from visa and mastercard, higher than the big banks, although they control about 60% of the market. and those big banks have been so heavy-handed in their response

to swipe reform, they have driven their consumers, many of them, straight into the arms of the community banks and credit unions. credit unions in particular are flourishing after the passage of the law that had swipe fee reform, a law which they actively opposed. last year, 1.3 million americans opened new credit union accounts that was up from 600,000 the year before. more than twice as many people switched from banks to credit unions. credit unions now have a record number of members across the nation. almost 92 million overall. so much for the prophecy by the credit unions that this change in the law would be the end of them. it's turned out to be the best thing that's ever happened to them. i know the washington lobbyists for the small banks and credit unions still like to complain about this reform. these lobbyists have spent so much time fighting reform, they are just not going to change their positions. but the facts are clear if they will just be honest enough to admit them.

small financial institutions have thrived since this reform took effect. how about consumers? the big banks tried last year to recoup their reduced swipe fees by charging 5-dollar monthly debit fees on their card holders. remember that? remember when bank of america said it will go up $5? all across america, they said bye-bye, america, we'll go somewhere else. within a month or two, they backed off it. finally, consumers were coming alive. they were awakened to the reality that they could shop, too. this is a free market, underline the word free. and if you don't like the way your bank or any institution is treating you, go shopping. that's part of america. the banks have never run into that before. people just waited unfortunately for the latest fee increase. they don't wait around anymore. they pick up and move. unlike swipe fees, the big bank's $5 debit fees were transparent, and customers moved. consumers are also benefiting

from savings passed along by merchants. after reform took effect in october, we saw a massive level of retailer discounting that extended beyond the usual holiday season discounts. according to "usa today," an article from may 11, a number of individual merchants are offering debit card discounts for items such as gas, furniture and clothing. "usa today" also pointed out that despite the bank's threats, free checking accounts for consumers have not disappeared. "usa today" reported that in the second half of 2011, 39% of banks offered checking accounts with no monthly maintenance fee up from 35% for the first half of the year. also, of those banks that charge checking maintenance fees, the average fee fell in the second half. this is what's known as competition. what is wrong with that? that american families and consumers go shopping for the best bank deal. it's happening because swipe fee reform has created new competition. i think competition is a good thing. now it's important to note that

the savings of swipe fee reform to merchants and consumers actually should be even greater than it is. when the federal reserve was writing its rule to implement my amendment, the banks lobbied them to set a debit swipe fee cap at levels significantly higher than the 12 cents that the feds said it actually cost to process a debit card transaction. predictably, visa, mastercard and the big banks took advantage of this watered down legislation that they have lobbied for. visa and mastercard promptly jacked up their swipe fees to the 24-cent ceiling set by the fed. here's what's happened. because swipe fees have traditionally been charged as a percentage of the transaction amount plus a small flat fee, this meant that the small dollar transactions used to incur fees of much less than 24 cents. now with visa and mastercard's rate increases, businesses that primarily deal with smaller transaction, coffee shops, fast food restaurants, they are paying far more in swipe fees than they did before. this is not a flaw in the law we passed, which wisely required

reasonable and proportional charges. rather, it shows the danger of watering down the regulations to implement the law. the banks and card companies lobbied the federal reserve for the loophole which they immediately raced through. this is something we need to fix going forward. it can be fixed. i'm pleased the amount of swipe fee reform we enacted in 2010 is off to a good, solid start. more competition, customers and families moving across america for the best treatment that they can receive from their bank or their credit union. already, the big banks and card companies are plotting to undo all these reforms and get that money back, the billions of dollars which they were taking in under the unregulated swipe fee regime. visa in particular has crafted new fee schemes in its continuing effort to monopolize the debit card market. in fact, visa recently disclosed that the u.s. justice department had opened a new antitrust investigation into any competitive aspects of visa's

newest fees. i continue to be concerned that the giant card companies, particularly visa, are becoming too big and too powerful. these companies have gained an enormous amount of control over the way americans can use their money. they set up fee systems. they dictate security standards. they make a fortune by taking a cut out of every transaction they handle far beyond the cost of processing. there is no regulatory agency that directly supervises the actions of these card companies, and we can't afford to simply trust these companies to do what's in our nation's best interests or to watch out for consumers. that, again, is why the consumer financial protection bureau is such a critically important agency. it is virtually the only consumer protection agency at the highest levels of our government. in the weeks and months to come, i will continue to work to ensure that the debit and credit card systems have competition, transparency and choice, that there is a framework for reasonable regulation. i know the big banks and card companies are going to continue

to fight it. they have a lot of money on the table. but i believe reasonable regulation is the right way to move forward, and i will continue to work for it. our economy, our small banks, our credit unions, our merchants and our consumers are benefiting from this important change in the law. mr. president, i yield the floor. the presiding officer: the senator from alabama. mr. sessions: mr. president, i'm on the floor this afternoon to discuss a discovery, really a stunning discovery for me that's important for all of us. as many people know, congress and the president struck a deal last summer to raise the debt ceiling. that deal set in place discretionary spending caps, not nearly enough to balance our budget over ten years but a step in the right direction. that legislation said that we will raise the debt ceiling

$2.1 trillion but we will cut spending $2.1 trillion over ten years, a promise to cut spending over ten years. that legislation also required the senate budget committee, of which i am the ranking member, it required that the chairman of the committee by april 15 of this year to file aggregate spending levels, spending limits based on the congressional budget office's march, 2012, financial baseline, and to allocate the funds that could be spent under that budget control act legislation to each of the senate committees, appropriations committees. in other words, these levels as submitted tell the appropriators how much they can spend, and the budget chairman has that responsibility and duty to do that.

he takes a level agreement that was agreed to and he sends that over. these are real dollars that each appropriating committee is therefore allowed to spend, yet we have learned something that's disappointing, really astounding to me. the numbers filed by chairman conrad, my good friend who is a fair and able chairman, are not, in fact, the spending levels of the c.b.o. baseline, as the statute sets forth. instead, the discretionary outlay total submitted by the chairman to the committees for fiscal year 2013 is derived from the president's budget. not from the c.b.o. baseline. the discretionary spending allocation for the senate is therefore inflated by about $14 billion more than what was agreed to just last august. we told the american people we

would raise the debt ceiling, continue to borrow money but we were going to reduce spending. so let me repeat that. these allocation levels have been inflated by $14 billion to match the president's budget, not the c.b.o. baseline that the b.c.a. committee was working from. it raises outlay levels over that august agreement, and that i submit was a solemn agreement between the members of congress, both the senate and the house, the american people and the president himself who signed that agreement. so i have sent a letter to chairman conrad today urging my chairman to correct and refile numbers that are proper, numbers that comply with the law. and i will be submitting, mr. president, an offer for the record, a letter that i have written senator conrad today. the presiding officer: without objection.

mr. sessions: it's unthinkable that we would not only spend more than congress agreed to, but would institute instead the numbers derived from president obama's budget, which in this chamber when i brought it up a few days ago, was rejected unanimously. this is another example, i'm afraid, i have to say, of the sleight of hand tactics that have been utilized in this congress for too long. that say we've got an agreement and we're going to do better and we're going to spend less. and as soon as the ink is dry, before the ink is dry really on the agreements, people start manipulating ways around them. trying to spend more than the amount allowed. it seems to be since i've been in the senate for 15, 16 years, these -- we have members of congress that take it as a personal challenge to see

how they can defeat, get around and spend more money than they're allocated. the american people are being misled in this attempt. we're not following the budget control act. and it's not a partisan matter. it's about honest accounting, it's about safeguarding the american treasury, it's about restoring faith in the senate chamber. the american people are right to be angry with us, and to not trust us. because we haven't honored their trust. we haven't managed their money well. political elites remain totally disconnected from the financial reality that our country faces. game the system, spend more. the alarming discovery that the discretionary allocations filed for the senate are a total of $14 billion higher than we agreed to and the latest in a long line of episodes, this is the latest in a long line of

episodes that underscores the financial chaos that is the american government. these episodes include the g.s.a. scandal in las vegas with hot tubs and skits and magicians, whatever, the solyndra loan, $500 million to cronies for an ideological vision that did not work. i.r.s. checks, i talked about it earlier this morning, senator vanderbilter and i --, vitder and i given to illegal aliens claiming dependents abroad. people here illegally, and the united states government is sending them checks based on children that are not even in the country. and inspector general from the i.r.s. says this is costing the taxpayers $4 billion a year. it also includes a revelation that ninth circuit court of

appeals will spend a million dollars or more of taxpayer money for a decadent getaway to a beachfront resort and spa in the hawaiian tropics. it includes, of course, the three-year refusal of the senate majority to produce a budget plan. three years without a budget. so we are in badly need of strong executive leadership to put our finances in order. the president, cabinet heads, subcabinet heads that understand from the top to the bottom to look every day for ways to save money. this immigration tax scam cost the american taxpayers $10 million a day. divide that out, $4 billion by 365 days. the house has passed legislation that would close that gaping loophole, that problem. the senate is not acting.

so this chaos cannot continue. accountability and discipline must be achieved and the first step to the -- to right this ship ought to be actually correcting these allocations. and i call on my senate leadership friends to do that. we need an honest accounting. we need to spend what we agreed to. what was passed by both houses of congress and signed by the president. these dollars do not belong to us. they belong to the american people. they must be protected. each one of them is precious, each one of them was extracted from some hard-working american, sent to washington on the hope and the prayer that it would be wisely spent. and we don't have enough of it. we don't have enough money. so to stealthily increase discretionary outlays by $14 billion in one fell swoop is

unacceptable. it must be corrected. i call on my colleagues to do so, else we will continue to lose the confidence of the american people. i thank the chair and would yield the floor. a senator: mr. president? the presiding officer: the senator from arkansas. mr. pryor: thank you, mr. president. i'd like to speak as if in morning business for 15 minutes. the presiding officer: without objection. mr. pryor: mr. president, today i rise to discuss the national flood insurance program, which is a program that is trying to be reauthorized right now by the senate. the senators johnson and shelby have shepherded this bill through the banking committee, have a ton of respect for both of those senators and the work of the banking committee because they worked very, very hard to get it to the floor, to get it ready. in fact, it expires on may 31

and if for some reason we cannot work out something here in the next couple days, i sincerely hope that we will extend this on at least a short-term basis for another, say, 30 days and give us time to work this out because the national flood insurance program is too important to mortgages and commercial real estate, etc., to let it lapse. we should not let it lapse. if we can't work it out right now, i certainly hope we can get say a 30-day extension and i support that effort. we need to reauthorize this bit of legislation, this program, but we need to do it in the right way. several senators over the course of the last few months have stated objections about s. 1940, and here are mine. in fact, i've listed out some of mine in a letter that we sent to the chairman and ranking member last month or so. i'll have to pull the letter -- i'm sorry, november 15 of

2011, we listed out several objections that we had or concerns we had with the bill. 13 senators from nine states who signed this letter going to senators johnson and shelby. again, we appreciate their efforts, but we just have to do this the right way. so let me run through three or four or five of my concerns about this legislation and tell my colleagues why i cannot pport it in its current form, and why i do support an extension, but why in the end, if the bill stays like it is now, i cannot support it and i hope that many of my colleagues will join me in the effort of not supporting this legislation as it's currently drafted. let me start, mr. president, with the bill itself, s. 1940. the primary objection that i have is in section 107 of the legislation. it's called mandatory coverage

areas. basically what it does is it redefines special flood hazard areas, and this may not sound very exciting or very fun to people, but this is critically important. i'm showing a map here on the floor today. all of these counties in the dark green, there's 881 counties total that have levees in their counties. it's about -- my understanding, about well over 50% of the u.s. population has -- lives somewhere near a levee. they may not realize it because the levees work and they don't have floods but if you see this map, you can see the levees all over the country and if you're a senator representing one of those states, by strongly encourage you and your staff to look at section 107 of the legislation. here's part -- this is 107-b

and it says residual risk areas. the regulations required by sub section a shall require the expansion of areas of special flood hazards to include areas of residential -- regliez you'll risk -- residual risk located behind levees, near dams or other flood control structures as determined by the administrator. subsection c says mandatory participation in national flood insurance program. c-1, in general, any area described in subsection b, the one i just read, shall be subject to the mandatory purchase requirements. okay. then if i go down to c-3, it says in carrying out the mandatory purchase requirement under paragraph one, the administrator shall ensure that the price of flood insurance policies in areas of residual risk accurately reflect the

level of flood protection provided by any levee, dam, or other flood control structure in such area regardless, regardless of the certification status of the flood control structure. so regardless of whether these levees and dams are certified, in many cases by the corps of engineers, in other cases by private engineering firms, regardless of whether they are certified, the people behind those levees are going to be required to purchase flood insurance. it says he regulations required by subsection a shall require, shall require -- no wiggle room there -- shall require the expansion of areas of special flood hazards to include these areas. mr. president, this is a great expansion of this program. i want to talk about the expansion here in just a moment. but let me say that the folks in

these areas -- and i snow noe it's certainly true in my state of arkansas but the people in these areas, they currently pay for flood protection. in most cases what they do is through some sort of local levy or local tax, it's different in different places, but somehow, some way they pay to build and maintain these levees. they are paying out of their pocket right now to make sure that they don't get flooded. now what this bill does and what fema would do under this bill, would be required, no wiggle room, what they would be required to do under this bill is make them pay again. not only pay for their own levee, play flood insurance for floods that will never happen in their areas because these levees are certified. again, this is 881 counties, 50% of the u.s. population. over half the counties in arkansas have levees, and

there's over 1,200 dams in our state. i don't have the number of dams for everybody all over the country but it's over 1,200 in my state, so you can multiply that out by how many dams you think there are in the u.s. it's a huge number and it's going to affect well over half the people in the united states. so i mention that these folks are already paying for their own flood protection through local levies. they also are going to now according to this law have to pay for insurance but in addition to that to rub salt in the wounds, what they're going to have to do is -- their local counties are going to have to pass an ordinance that fema has written, and it's going to restrict the land use. and in many cases, that ordinance will diminish the property values, diminish the ability for them to do development, economic development in their communities. if we can just take one example of something that happened last

year, last year we had terrible flooding in the midsection of the country. many of you remember that. they had, the corps of engineers ended up having to glow below the levee at bird's point, part of the corps of engineers mississippi river and tributary system. by the way, we need to thank the corps of engineers and praise them for the engineering they've done on this river. i know there's been a few problems here and there over the years, some obviously happened in katrina, but overall the corps of engineers, they design things that work. and certainly when you look at last year, the 2011 flood of last year, in the mississippi river you know, long -- one of the longest in the world, certainly the longest in north america, there was more water flow through the gauging stations along the mississippi river from cairo, illinois to natchez, mississippi than any flood in recorded history. the flow at cairo, illinois,

the confluence of the mississippi and ohio, was over two million cubic feet per second. two million cubic feet a second was running through the mississippi river right there. helena, arkansas, it was running at 2.3 million cubic feet a second. now, at some locations the corps of engineers is in the process of determining this, they're not ready to say it yet but on some locations up and down the mississippi river system, they are considering whether this actually was not a 100 year flood or 250 flood, this was actually a 500-year flood, the largest flood in history. and all this, all of this mississippi river mr & t, mississippi river and trib beaut taxpayer system cost the

-- $32 billion. but just in the flood last year, it saved taxpayers $110 billion in damages. that's a great return on investment. we need to honor that return on investment. we need to not charge people an additional flood insurance for areas that don't flood. they just maybe had the 500-year flood up and down the mississippi, or at least in certain parts of it, and there was not one acre of ground that went underwater. it was a new flood of record. 10 million acres of land were protected. a million structures were protected. and, again, it prevented $110 billion of property damage. there were no lives lost, not one acre was flooded, and the system worked exactly according to plan. so now this bill comes in and says, well, even though we just had, you know, the 250-year or the 500-year flood, still we want to make all these people up and down the mississippi in all

these counties, we want to make them -- not all the people but in certain parts of these counties, depending on what the flood maps say, we want to require them to pay flood insurance when it's never going to flood there. so i want the -- my colleagues to know that this provision, section 107, in the senate bill is not in the house bill. it's not in the house bill. so i think the reason it's not -- i can't speak for the house, of course -- but i think the reason it's not is for the reasons i'm saying right here. we know that it's not going to flood in these areas. this is the corps of engineer flood. this is the best levee system in the world and it's keeping these folks safe and dry when the floods come. now, also, i wanted to say that the house does not have section 107 many their bill, it never did. also, there was a house amendment offered by congressman cardoza who took out a requirement to show that these

areas be on their maps, and that vote passed 261-163. so, again, not only can we get consistent with the house because we can get rid of 107, but we can also get rid of other specific parts of this legislation that will be more consistent with the house. another thing i want to talk about with regard to this bill -- oh, by the way, one more thing, mr. president, before i go completely away from this map. here's a map of the mississippi river, the area that i'm talking about, and you see the states of louisiana, mississippi, arkansas, tennessee and missouri and a little bit of kentucky and illinois in there as well. but this right here, this large, blue area is what they call the historic floodplain. so before man came, before people started building levees, before they started draining swamps and trying to manage the land, this is the area that would flood. one thing that's important to know about this is a lot of this

area in this light blue is some of the richest farmland in the world. and the reason it's so rich is because for centuries or eons or you however long it was, this river would flood periodically and put this very, very rich soil out there. that's one reason why in this part of the country, you can grow almost anything. that soil is great. it's a huge industry for this area that we keep it going and it's also critically important for u.s. trade and the u.s. economy that we have a -- this is the breadbasket, so to speak, of the u.s. right here -- that we have that area growing food and fiber for everyone. it's critical that we keep that going. now, once the corps of engineers gets hold of the mississippi river, this is what it looks like now when it floods. this is now the floodplain. and so if you go back to last year when it flooded so bad, this is what it looked like, with one exception. they blew out this one little area in bird's point up here somewhere to give a little bit of relief. and, again, that was by design and that worked.

so the -- the first problem i have with the bill is section 107. another problem is just the general expansion of what this bill does to the national flood insurance program. one of the things that's buried in the bill that a lot of people may not see is in section 118. section 118 talks about how the administrator needs to establish an ongoing program under which they review and update and maintain national flood insurance program rate maps in accordance with this section, et cetera, et cetera. and then it goes down their criteria of what they need to look at. one is, all populated areas in areas of possible population growth located in, not the 100-year floodplain -- not the 100 year, because that's what the current law is, 100-year floodplain -- nope. what this bill says is the 500-year floodplain. 5900-year floodplain.

we don't have a map of that because the corps of engineers has not finished mapping and fema hasn't accepted all those maps yet. we don't know exactly what it's going to look like. but i'm going to tell you, it's going to look something like this right here. and i don't know exactly, but you can bet your bottom dollar that a lot of people in these areas, this light blue area, are going to have to pay flood insurance. and based on the flood we just had last year, they are never going to get flooded. not in a hundred years, not in 500 years, they will never get flooded. but this law requires that they purchase flood insurance. this is a huge expansion of the program. and it has a big impact not just on homeowners -- that's obviously very important. you're not going to be able to get a mortgage if you're in a floodplain. you know, when it says -- when this law says in -- in its -- let me pull the section right here, mr. president. when this law says in its -- in

the committee report that "notice will be provided to property owners in the 500-year floodplain to inform them of their flood risks which may lead to more owners protecting their property through flood insurance " -- the presiding officer: the senator has used his 15 minutes. mr. pryor: mr. president are i would ask that i would have five more minutes to wrap up. the presiding officer: without objection. mr. pryor: thank you, mr. president. so, mr. president, the -- what this says in the committee language -- in the committee report, it says that the 500-year flood notation should be sent out to everyone so everyone knows that this property is in a 500-year floodplain. the problem there is folks are not going to be able to get mortgage insurance, they're not going to be able to -- to do real estate development, commercial real estate is going to hurt from that. you're not going to be able to have economic development

projects in these areas because of the floodplain notation. also, on page 8 of the committee report, it talks about how this is going to -- they're going to spend about $400 million annually in doing this mapping. well, if you're going to map out to the 500-year floodplain, that's a heck of a lot more mapping than just the 100-year floodplain. so you can save quite a bit of money by doing that. mr. president, the bottom line is these levees are designed correctly, they're built correctly, they're maintained correctly, and they're certified that they're safe. and so what's the point of having people come and do more flood insurance in that area when it's not required right now? mr. president, my last point is this. i also think this legislation requires a huge conflict of interest for fema. it's not fema's fault. they're not asking for this. it's what the congress is trying to do. basically under this law, fema would write the regs, they'd draw the lines, they will

control the timing, they'd set the standards, they'd update the maps, they'd maintain the maps. if there's an appeal, you'd have to go to fema. they set the rates. they collect the money. they spend the money. everything is done by fema. obviously, fema is going to have an interest to make sure this program is adequately funded and solvent and they should, but they have control of every aspect of this with no checks and balances in this system. and they're going to be, again, millions and millions of people who are going to pay in to make this solvent, i guess, but that will never need flood insurance. so, mr. president, with that, i'd just like to say that i would hope my colleagues who have -- who have counties in these states here, that represent these states, when they look at section 107, they will see what i see and we could all work together to either take out section 107 completely or at least get the 30-day extension where we could have time to take

it out in the next few days. with that, mr. president, i yield the floor. [inaudible] mr. pryor: i ask unanimous consent that the majority leader be recognized at 4:00 p.m. the presiding officer: without objection. mr. pryor: thank you, mr. president. mr. hatch: mr. president? the presiding officer: the senator from utah. mr. hatch: mr. president, i ask unanimous consent that my remarks be placed at an appropriate place in the record and that i be permitted to finish my remarks. the presiding officer: without objection. mr. hatch: mr. president, we find ourselves in the midst of a presidential election. in years past, its might have been expected that during a presidential election, politics would take precedent over fallacy. that was not right then but it is certainly not right now. our nation faces serious problems, immediate problems, and we cannot wait to tackle them until after the election. we are over $15.7 trillion in debt and before the end of this year will be over, $16 trillion. we have a tax code that is unmanageable and a burden on

conscientious taxpayers. and if the president and congress fail to act, we have a tax increase coming next year that will dwarf any in our nation's history. we cannot afford to wait another seven months to get our fiscal house in order and we need to act now. president obama at least claims to understand that we cannot wait to address this fiscal crisis. he remarked recently that the fact that this is an election year is not an excuse for inaction. now, unfortunately, other than talk, the president and his liberal allies have done nothing to address either our rising debt or the fiscal cliff that we are quickly approaching, both of which are significantly hindering our economic recovery and job growth. last week, president obama's budget received zero votes in the united states senate. for the second year in a row, every republican and every democrat who voted on the president's budget voted against it. and remarkably, not one democrat voted for the serious republican

budgets offered by my friend, chairman paul ryan, and my friends and colleagues, senator toomey, paul, and lee. while he talks a big game, president obama has shown little interest in lighting a meaningful path towards balancing the budget. reforming the tax code, and reducing the tax burden on working families and small businesses. instead, president obama seems to have a single-minded focus on his reelection. but while he attempts to scare up votes in swing states, americans across the country are suffering due to president obama's failed economic policies. the people of utah and the people across the country are naturally growing restless. they look to europe and see the consequences of out-of-control spending and taxes, yet even with the example of europe, the president and his friends resist meaningful spending cuts at every turn and his liberal allies have done everything they can to mislead the public about the responsible intentions of

republicans to reduce wasteful government spending. just as critical for our economy is the president's failure to do anything to address the tax relief that will expire at the end of this year. if the president allows current tax relief to expire, the result will be at least a $4 trillion increase, tax increase, on the american people. you can call this a fiscal cliff you can call it tax-mageddon, as others have done. whatever you call it, it will be a disaster for the middle class and it will be a disaster for small businesses that will be the engine of our economic recovery. now, one thing we hear time and time again from businesses is that uncertainty holds them back from investing, expanding, and hiring. a robust recovery will require permanent pro--growth tax policy, and give -- pro-growth tax policy and given the continued jobs recession and weak economic growth, we need

those policies now. economic growth slowed to 2.2% last quarter. for 39 consecutive months, the unemployment rate has remained above 8%. but that only tells part of the story. 12.5 million americans are unemployed, and of those, more than 5.1 million workers have been looking for work for 27 weeks or more. 7.9 million americans are working part-time for economic reasons, and another 2.4 million have only a marginal attachment to the labor force. close to 2 million college graduates are unemployed. growth slowed to a tepid 2.2% rate in the first quarter and we already saw biscuit -- business cutback and investment in businesses dedliend -- declined to 2.1% in the quarter. and yet president obama and his friends continue to sit on the sideline as tax-mageddon

approaches and threatens even greater harm to our economy. the coming tax increases will be , without any exaggeration, the largest tax increases in american history. and the possibility of these tax increases is creating enormous uncertainty. the so-called business tax extenders expired at the end of 2011. will there be an r&d tack credit in 2012? -- tax credit in 2012 in will there be an exemption from sub-part f for income after 2011? family and businesses do not know if the 2001 and 2003 tax relief will be extended beyond 2012. that creates tremendous uncertainty for anyone planning on buying a home, saving for college, investing in a new business or hiring a new worker. will passthrough organizations be taxed at 35% or 39.6%? will dividends be taxed at 15% or will dividends be taxed at

39.6%, as president obama has proposed? will there be a death tax that hits family businesses and farms with a maximum rate of 55% or of 35% or of something else? and what will happen to the alternative minimum tax? will it be patched? will it be reformed? will it be repealed? will it just be replaced with higher taxes somewhere else? the president and the senate democratic leadership have shown no willing misto answer these questions and provide the certainty that our economy craves. the adverse impact of these tax increases on economic growth is unquestioned. but don't take my word for it. it's been reported by federal reserve chairman ben bernanke -- it has been reported that federal reserve chairman ben bernanke recently discussed with senate democrats the significance of taxmageddon.

chairman bernanke warned that monetary policy would not be capable of offsetting the decline in economic growth. just last month th the fed's policy-setting committee repeatedly warned in minutes of their meeting that fiscal uncertainty has negative effects on consumer and business sentiment, on business capital you expenditures and on hiring. the former director of president obama's office of management and budget concluded that what he estimates to be $500 billion tax increase would be so large that -- quote -- "the economy could be thrown back into a recession." unquote. according to barkley's capital, this fiscal cliff could reduce our g.d.p. by 3%. and in addition to those looming tax hikes, budget cuts from the sequester that followed from the

administration's failure to arrive at a budget are set to hit as well. according to the magazine "the economist," the congressional budget office has found that the combined effects of the sequester and the expiring tax relief would add up to 3.6% of g.d.p. in fiscal year 2013. federal reserve governor duke has reportedly indicated that the combined impact of an expiring fiscal policies at the end of the year could amount to around 4% of the nation's economy. no economy can sustain such a hit without being hurled into a recession. yet instead of addressing this fiscal cliff, tax increases that will harm all of america's families, the president seems content to pursue misguided micropolicies that target the so-called rich in the name of so-called fairness. i would like to make two points about the president's object pre

president's obsession with redistribution of wealth. first, the person people do not care. the american people do not want bureaucrats figuring out who gets what. they don't want politicians spreading the wealth around. they don't want self-anointed arbiters of how much income is fair. what they swants the opportunity that comes -- what they want is the opportunity that comes from economic growth. they don't want a handout. they don't want their industries vilified for engaging in free enterprise. they want a job. nothing is more fair than giving every american the chance to make something of himself or herself. that requires washington getting out of the way, not getting more involved. second, the american people seem to understand that the president's promise that he will only tax the rich is a sucker's bet. with his health care law, he already repeatedly broke his campaign promise not to raise

taxes on families making less than $250,000. a year. the people in utah and of the rest of the other states know that the democrats' thirst for mour more spending will require much more than taxes on the wealthy. if president obama and his democratic allies get their way, all taxpayers are going to be looking at bigger tax bills. president clinton was honest on this point recently. he rejected president obama's politically convenient claim that he would only tax the rich and call for across-the-board tax increases. this is just me, now. i am not speaking for the white house. i think you could tax me at 100% and you would not balance the budget. we are all going to have to contribute to this, and if middle-class people's wages are going up again and we had some growth to the economy, i don't think they would object to going back to tax rates from when i was president. there you have it. tax increases on everybody.

president clinton can claim that he does not speak for the white house, but the american people are not fooled. they see where the president's policies are leading. our debt and policies are leading. our debt and deficits are unsustainable. but the president has shown no inclination to address them through his spending reductions. there is only one other option available to president obama and it is one that he and his party have shown to be their preferred party for decades: higher taxes to pay for more spending. utahans and americans all across the country nona the fail tour to adref taxmageddon is a very real threat. we cannot put this discussion off any longer. it is time for our president to lead. to that end last week i along with 40 of my republican colleagues sent a letter to my colleague and senator from nevada, the democratic leader, asking him to address this in

short order. today we received a response. i have to say that i'm disappointed. while there is a great deal of political posturing about evil millionaires and big corporations as well as a repeated attacks on the tea parties and citizens who support its goals, there is no acknowledgesment of the fiscal cliff we are fast approaching. this response seems to confirm what we already know: president obama and his liberal allies would prefer to put off a discussion of this fiscal cliff. they do not want to address taxmageddon. i am fairly certain that they are preferential would be to get to the other side of the election and then have tax hikes set in not only for their caricatured evil corporations and individuals but for the middle class as well. i'm confident that the markets s and the american people are not going to allow this to havment we cannot afford to delay action

that will prevent taxmageddon and steer us away from the coming fiscal cliff. the likelihood of taxmageddon and the uncertainty it creates is are an anchor around our economy. americans young and oacialtiond unemployed and undergloid want this anchor thrown off now. the economy is slowing. job growths is lagging. businesses are cutting back investments. the uncertainty caused by taxmageddon is contributing to the lackluster economic recovery. smerns families and businesses are not going to invest in the future if the future holds a $310 billion tax increase next year alone venal the best thing we could do is to turn the wheelway from the fiscal cliff sooner rather than later. mr. president, i ask unanimous consent that paul williams, a detailee from the senate finance committee from the food and drug

administration, jesse baker, a detailee to the senate committee from the u.s. secret service, andrea shelton, from the judiciary committee, and maureen mclaughlin, a detailee from the f.c.c., all be granted the privilege of the floor for the remainder of the second section of the 112th congress. the presiding officer: without objection. mr. hatch: with that, mr. president, i yield the floor and -- i yield the floor. emr. reid: mr. president, i rise today in support of the food and drug administration safety innovation act which is pending before the senate this week. this legislation would give the f.d.a. the resources to approve additional drugs and devices every year for their safe and effective years. without this agreement, the f.d.a. starting in october would lack these resources which are necessary to approve new drugs and devices.

and they would also lack resources to montan monitor thes and devices on the market. this would marge nice our drug and device approval. i am pleefs pleased that for the first time the generic pharmaceutical industry will provide the agency with $1.5 billion over five years for faster product reviews. the essence phs legislation is that the industry providing resources for the monitoring and approval of the drugs. getting generic drugs onto the market sooner will help lower costs for individuals and families as well as for the federal and state governments. this measure would also significantly improve f.d.a.'s regulatory authority including its ability to help prevent drug shortages and to help develop new medications to treat life-threatening diseases that are becoming resistant to antibiotics. this is very important. i would like to recognize

especially chairman harkin ads and senator enzi for their very thoughtful, deliberative, and extremely important work. they have represented through their committee work the model of what we should be doing here collaboratively and on a bipartisan basis to advance important measures for the american people. they deserve great -- both of them -- great accolades for their work today. i hope we can follow through and bring their work to conclusion. i want to particularly thank both of them, chairman harkin and senator enzi, for including provisions pertaining to pediatric devices and drugs. i offered with senator alexander and senator murray and senator roberts. again, another bipartisan effort to help improve the health of children throughout this country. until 1997, and that's just 15 years ago, 87% of children were used by children. doctors were treating children

without understanding the appropriate dosage requirements for the potential for dangerous side effects. this angered many families. those sentiments were largely ignored by the industry until congress stepped in. with the passage of the best pharmaceuticals for children act in 1997, and the pediatric research equity act of 2003, 427 drugs have been relabeled with important pediatric information. now, just 46% rather than 80% of drugs are being used off-label in children. but that number is still too high. the legislation before the senate makes critical improvements to these laws so we can further lower this percentage. it would make these two act acts permanent, just like the laws that govern the approval of drugs for our use. it would also provide the certainty that pharmaceutical

companies believe is necessary to wisely invest in the appropriate use of drugs and children. the legislation will also help ensure pediatric studies are planned earlier in the development process and completed sooner. currently, a disappointing 78% of studies that were scheduled to be completed by 2007 -- september of 2007 -- are either late or were submitted late while congress, the f.d.a., advocates in industry agree that a pediatric study should not hold up the approval of drug use in adults, drug companies should not be allowed to get away with unrealistic plans for the f.d.a. for approval or failure to complete the studies after the drugs are brought to manchet i note that the majority leader has appeared on the floor. i believe he has a procedural motion. mr. reid: if my friend would complete his remarks. mr. reid: i would be happy to. --

mr. reed: i would be happy to. mr. reid: i ask unanimous consent that following the statement of my friend, the senator from rhode island, and immediately upon his finishing of his remarks, there be a -- he will initiative a quorum call aged be recognized at such time u. the presiding officer: without objection. mr. reid: so i see people shaking their heads. senator reed is going to talk, he is going to go into quorum call. and when we come out of that i am recognized. i ask consent. any problem with that, anybody?

the presiding officer: without objection. the senator from rhode island. mr. reed: thank you, mr. president. i want to continue my remarks on the important topic of the pediatric provisions of the f.d.a. legislation that is

before us, and i would simply continue by saying that the legislation that is before us would require pharmaceutical companies to work with the f.d.a. early in the process of developing these drugs to create a reasonable and essentialable plan for studying the product. it would also for the first time provide f.d.a. with an enforcement tool that will deter companies from neglecting their obligation to complete these studies on time. our b -- our bill responds to the needs of the development of pediatric medical devices. not just pharmaceuticals but devices in children, which can lag five to ten years behind those manufacturers for adults. the pediatric profit allowance for human tarry use has proven to be effective. three new devices have been approved for use in children in the last three years. this is an incredible increase as a result of this incentive. this policy has shown much promise, and i'm pleased continuing this bill along with

the pediatric device consortia grant program which assisted in the development of 155 proposed pediatric medical devices in the last two years. the food and drug administration safety innovation act would also extend this humanitarian use device incentive to manufacture device and use for adults with rare conditions. while it is my hope this policy is equally effective in spurring devices for use in adults as it is for children, i'm concerned it could impact the development and marketing of devices for use in children. i plan to monitor this policy closely should it become law, but i have full expectation that both noble objectives can be achieved. there are some children, however, who do not receive the full benefits of the bpca and the pria act. i'm pleased the senate bill addresses this problem for pediatric cancer patients and children with other rare diseases. it calls on the f.d.a. to hold a

public meeting to discuss ways to encourage the development of new treatments for this population. indeed for some pediatric cancers, the treatment hasn't changed in many decades. for other rare diseases, an effective treatment has yet to be found. i look forward to receiving the recommendations that might stem from this important meeting as well as working with my colleagues to respond to their needs with reasonable and sensible policies. i am traoepblgsly pleased that -- i am pleased these pediatric provisions have drawn the support of many organizations, 24 including the american academy of pediatrics and also including the pharmaceutical researchers and manufacturers of america. this stakeholder supported is very important not only for the passage of the legislation but for effective implementation. there is another provision i'd like to talk about, and this bill contains a provision which will require the f.d.a. to decide whether or not to update the labeling requirements for tanning beds.

and i would propose this amendment also. every day too many americans visit a tanning salon. 70% of these are young women and women of all ages. according to the world health organization, the risk of deadly melanoma increases by 75% when the use of tanning devices begins before the age of 30. there is a particular concern with younger women beginning to use and younger men beginning to use these tanning devices. yet the warning labels on tanning beds have not been updated in over three decades and are often placed far from view. in 2007 my colleague, senator isakson of georgia, joined me in requiring the f.d.a. to study the labeling standards for tanning beds and make recommendations but how these standards could be improved. in its report the f.d.a. found tanning bed levels could be clarified and locate tphad more -- located in a more prominent location but the

agency has yet to act. it is my hope the f.d.a. will heed its own requirement and update labeling requirements for tanning beds. similar, sun screen testing and labeling standards have also been over three decades in the making. three decades. last year i was pleased when the f.d.a. finally took action. however, just last week the agency announced that it would be extending the implementation of these new standards by six months, until december. consumers will have to go another summer without knowing whether or not they are truly proebgtd from the sun -- protected from the sun's harmful u.v.a. and u.v.b. raise. i have filed an amendment to make sure there are no future delays. i look forward to working with my colleagues to see this amendment is accepted as part of the final f.d.a. legislation which i hope is passed quickly by the senate. i want to thank chairman harkin and senator enzi for their extraordinarily effective and collaborative work on the better

pharmaceuticals devices act for children which is included in this bill. i thank them very much. just for a moment let me raise another pending issue, which is of critical importance. in 40 days, as i think many of us recognize, student borrowing rates for college will double unless we act. and we have seen both sides of the aisle, colleagues from both sides come down and say we cannot let this happen. we can't let it happen. that means we have to take action to prevent the doubling of interest rates on stafford loans. unfortunately last week we had a see rifs budget votes which most of my republican colleagues supported which, if they passed, mandated the doubling of the student loan interest rates. so i think we have to move away from the, this debate in terms of doubling and actually pass legislation which will prevent the doubling of student loans by july 1. i hope we can do it promptly,

certainly before july 1. and also i hope that we can find an effective offset. what the republicans have suggested is using the prevention fund. the president made it clear he would veto the legislation if it included that offset. and also what should be clear is that using resources to prevent decision -- prevent disease not only helpful for the american public but also probably one of the practical ways we're going to be able to begin to bend that very important cost curve going forward. this prevention fund is going to help everyone but it is going to particularly help middle-income families who are struggling with medical bills, struggling to find insurance. the same families are struggling to pay the cost of college for their children. it makes no sense to me to take from one program that will benefit, working families to pay for another program that will benefit working families. we have an offset which is an

egregious tax loophole which allows lobbyists and financiers to create subchapter "s" corporations. that i think is an appropriate way to pay for this support for students and education. if there are other ways beyond the prevention fund, i'd be certainly happy to listen to them. if there were other principal ways to avoid doubling the interest rate for student loans, let's talk about them. let's get them on the floor and let's debate them. madam president, i will conclude, but i would also like unanimous consent that my statement be included as one statement rather than being divided with the colloquy between myself and the majority leader. the presiding officer: without objection. mr. reed: thank you, madam president. with that, i would yield the floor. mr. reid: madam president? the presiding officer: the majority leader. mr. reid: i ask unanimous consent that the execution of the previous order with respect

to s. 1387 occur at 11:00 a.m. tomorrow morning and that all other provisions under the previous order remain in effect at the time. s. 3187. the presiding officer: without objection. mr. reid: madam president, as i said here this morning, i hope that i'm not disappointed and i hope the senate's not disappointed in not being able to finish this f.d.a. bill. we're on the bill. i hope we can work out some finite list of amendments. that would be the best thing to do for this bill. i say to everyone, i hope we can do that. i don't want to have to come here tomorrow and file cloture on the bill, but that's a choice i'll have. or i can -- i can do this, and maybe what i might do is move to reconsider the student loan. i have the ability to do that at any time. we need to get this done. today is tuesday.

i just think it's unfortunate. there's an event tomorrow night that we can't get out of. it's been long-standing for the senate and their spouses. so we don't have a lot of time. so tomorrow morning, if we don't have something worked out, i think we're going to have to do some other things and recognize that all the happy talk on this bill may not come to be. i would note the absence of a quorum. i'm so sorry. i didn't see senator bingaman behind me. i withdraw that, madam president. the presiding officer: without objection. mr. bingaman: madam president? the presiding officer: the senator from new mexico. mr. bingaman: madam president, i thank the majority leader for allowing me to speak. i wanted to speak about an amendment which i intend to offer once we do get on to this food and drug administration safety and innovation act. this is an important amendment, and i want to advise my colleagues and all who are

listening about it so they can, hopefully look into it and wind up supporting the bill. this is an amendment that senator vitter as worked with me on, as well as senators franken, shaheen, cole, tom udall, tim johnson, senator klobuchar, senator merkley, senator sanders and senator sherrod brown. the amendment has the strong support of many organizations that are focused on the cost of prescription drugs. here is a list: aarp, afl-cio, wal-mart, families u.s.a., consumer federation of america, u.s. pirg, consumers union, center for medicare advocacy, afsme. national legislative association on prescription drug prices, the alliance for retired americans;

various other companies and organizations. the new mexico pharmacy association strongly supports this legislation. this amendment addresses the root cause of anticompetitive, anticonsumer settlements that are entered into between brand name and generic pharmaceutical manufacturing companies. the effect of these settlements that they enter into is to delay timely access consumers would have to generic drugs. this practice is commonly referred to as pay for delay. and it costs american consumers and it costs the federal government billions of dollars each year in higher drug costs. according to the federal trade commission, in 2010, pay for delay agreements, limiting access to affordable generic

drugs protected $20 billion in sales for brand name pharmaceutical companies, and that was at the expense of consumers who would have been able to pay much less for those same drugs. madam president, ensuring access to affordable medication is an essential aspect of addressing the growth in health care spending. prices for brand name prescription drugs have continued to outpace inflation and overall spending on prescription drugs has also increased sharply. these statistics are amazing to me. the kaiser family foundation found that in 2008, spending in the united states for prescription drugs was $234.1 billion. that's nearly six times what it was in 1990. since generic drugs are on average a fourth the price of

their brand-named alternatives, they can be an important source of affordable prescription drugs for many americans. but to actually achieve the savings for consumers, these generics have to reach market in a timely manner. in 1984 congress passed the bipartisan hatch-waxman act to create market-based incentives for generic pharmaceutical companies to bring their drugs to market as quickly as possible. the expressed purpose of that law was to incentivize early generic drugs competition. instead, the pay for delay settlements that our amendment tries to address, these pay for delay settle ph-lgts between

brand --ments between brand name and generic drugs have become commonplace. in these settlements, the first filer generic drug company agrees to delay market entry in exchange for monetary or other awards and this has the effect of blocking all subsequent generic filers from coming to market. now this is a complicated issue. i'd like to take a few minutes to explain how these agreements work under existing law and also how our amendment would solve this problem as we see it. under current law, first to file generic drug applicants are rewarded with 180 days of market exclusivity. exclusivity is awarded only to generic companies who are the first to file. it is not available to

subsequent filers even if they are successful in invalidating a patent or are ready to come to market immediately. if subsequent generic filers can only enter the market after the first generic filer has enjoyed its 180 days of market exclusivity. so under the pay for delay settlements, the first filer generic company essentially parks its exclusivity. it blocks all other manufacturers from coming to market until six months after the market entry date. this is true regardless of the strength of the patent or the readiness of subsequent generic filers to come to market. so this means that under the pay-for delay settlements, generic companies receive an award from brand name companies for delaying market entry. usually a cash reward, a very

substantial amount. they also get a reward from the current statute, this 180-day exclusivity period. and brand name companies get to extend their monopolies beyond what was originally intended under the hatch-waxman legislation. consumers are left footing the bill and left with no option but to buy the more expensive drugs and to keep buying it even after the generic should have come to market. so pay-for delay settlements are -- also typically include an agreement that the first filer generic company can accelerate their entry into the market in the event that a subsequent filer invalidates the patents in question. in such cases, the subsequent filer triggers the first filers exclusivity. put simply, there is no incentive for subsequent generic filers to fight to invalidate

weak patents and to come to market as soon as pombo. -- possible, even when they believe strongly they could win their case in court. whereas the original intent of hatch-waxman in court was to reward companies that were the first to swallow and bring their drugs to market, currently the reward goes to the first company to submit the necessary paperwork, and bringing the generic drug to market immediately has become an option which can be negotiated away. to fix the pay-for delay problem, the law needs to be changed so that the first filers who enter into pay for delay settlements can no longer block generic subsequent filers who successfully challenge patents from entering the market and bringing affordable drugs to consumers. the amendment that we are offering provides this solution or this fix in the following

three ways. first of all, the amendment grants the right to share exclusivity to any generic filer who wins a patent challenge in the district court. this means that if a subsequent filer successfully challenges a patent, even after a first filer has entered into a pay-for delay settlement with a brand him company, that subsequent filer has a right to share exclusivity with the first filer. this provision provides an incentive for subsequent filers to challenge patents and to stimulate competition. second, the amendment we're offering maximizes the incentive for all generic challengers to bring products to market at the earliest possible time by holding generic settlers to the deferred entry date agreed to in the settlements that they have signed. third, our amendment creates more clarity regarding

litigation risks by requiring brand name companies to make a decision to litigate a patent challenge within the 45-day window provided for in the hatch-waxman act. this use it or lose it provision enhances market certainty by eliminating the option for brand names to litigate patent challenges well after a generic has come to market. and finally, i think it's important to point out, madam president, that the amendment that we're offering does not interfere with the rights of the parties to settle their patent litigation if they choose to do so. there have been numerous antitrust experts and consumer groups that have identified the hatch-waxman act's structural flaw, the one that i have been describing here, as the source of this pay for delay problem and have called for a legislative solution. in addition, in 2003, senator hatch himself expressed concern

that the flaw remained despite an attempt to fix it by including a -- quote -- "use it or lose it provision in the medicaid modernization act of 2003. senator hatch emphasized that the law should be changed to reward and not penalize generic companies that successfully invalidate a patent and are ready to come to market. let me further underscore the need for this amendment with some concrete examples. i have got a chart here that i think will make the point that i am trying to make. this table shows three drugs included in pay-for-delay settlements. this is just three. there are many, many of these settlements entered into each year. the delay to market in years for each of the three drugs, the three drugs are altace, lipitor and provigil.

and the delay period that the settlements called for. in one case, two years. in another case, one and a half years. in another case, six years. and the lost savings to consumers, estimated lost savings to consumers. let me just describe each of these a little bit. the first drug is king pharmaceuticals altace. this is a generic version of altace. was delayed for two years at an estimated cost of $637 million to consumers under a pay-for-delay settlement. in 2007, lupen invalidated a patent covering altace. lupen could not launch or bring their generic to market despite being the party responsible for validating the patent and opening the market earlier. instead, the first filer, cobalt, accelerated its entry into the market and benefited

from 180 days of exclusivity. lupen was left with no reward, despite the fact that they had been the one that succeeded in the litigation arlington validate the patent. the second is a cholesterol-lowering drug familiar to most of us. it is the best-selling pharmaceutical drug in the history of the world, lipitor. according to a 2008 "new york times" report, pfizer and generic manufacturer brann baxby laboratories agreed to a settlement with the entry of a generic into the market by 24 months. the same agreement reported that a generic of the drug was estimated to sell for less than a third of the cost of the brand name lipitor, which had earned $12.7 billion in sales the year before. a letter sent to the f.d.a.

director, director hamburg last year by some of my colleagues in the senate indicated that the federal government was spending $2.4 billion a year on lipitor and that a generic version was expected to generate $3.97 billion to $6.7 billion in savings annually. a final example on this chart here that i wanted to mention is provigil. this is a sleep disorder drug, a generic version of which could have come to market as early as december of 2006. however, due to pay-for-delay settlements, a generic version of provigil just entered the market this year instead of 2006. in addition, in october, 2011, a subsequent generic filer, appetex, invalidated a patent covering provigil. because the first filers in this

case settled their patent litigation with the brand company six years prior, appetex could not begin selling generic provigil despite its court victory. even the c.e.o. of cephelon which is the brand name manufacturer of provigil is quoted as saying -- this is the c.e.o. of the brand name company, saying quote, we were able to get six more years of patent protection, that's $4 billion in sales that nobody expected, end quote. in other words, the provigil case represents six years and millions and tens of millions of dollars in lost savings to consumers. one of the largest of those consumers is the u.s. military. as this chart illustrates, this is an estimate of the effect of this settlement, this so-called pay-for-delay settlement related to provigil on the department of

defense. assuming that a generic version of provigil would have been released in 2006 with expiration of exclusivity, the department of defense alone would have saved $159 million for this drug accessed by almost half a million soldiers between the years 2006-2011. so had our amendment, the fair generics act -- and that is the name of our amendment. we have introduced it as a separate stand-alone bill -- but had the fair generics act been the law, generic versions of provigil would very likely have been available six years ago. the first filers, knowing the patent was weak and subsequent filers could invalidate it and come to market themselves would have fully prosecuted the patent fight instead of just settling it as they did.

as these examples illustrate, by granting shared exclusivity rights to any generic challenger who wins its patent case or is not sued by the brand company, our amendment will end the pay-for-delay problem and move us closer to the original intent of hatch-waxman. that original intent is more competition, greater access to affordable drugs and substantial savings to the united states government and american consumers. madam president, i hope when we get the opportunity to offer this amendment and consider it here on the senate floor and have a vote on it, that my colleagues will support this amendment. it will be a substantial step forward for american consumers and will help us greatly in our effort to reduce the cost of prescription drugs for americans. madam president, i yield the floor and suggest the absence -- excuse me. i yield the floor.

a senator: madam president? the presiding officer: the senator from massachusetts. mr. brown: thank you, madam president. i thank the gentleman for yielding. i'm pleased as well that the senate is moving this week to consider the f.d.a. safety and innovation act. a very important piece of legislation that will help ensure americans have access to safe, innovative medical treatments by giving the f.d.a. the resources it needs to review new products as safely and as quickly as possible, while also giving the industry the certainty it needs to continue investing in new research as i travel around massachusetts, the number-one issue i find is that lack of regulatory certainty and sometimes tax certainty, so this is certainly a step in the right direction. i'm pleased that this legislation takes many steps to strengthen the medical innovation industry in the united states. i have championed one such provision with senators mccain and casey that will smooth the regulatory path that i referenced earlier for new moderate risk medical devices. the underlying bill before us

needs to be passed as quickly as possible to guarantee that regulatory certainty at the f.d.a. for the industry and its stakeholders. however, i'm disappointed that the senate has not yet taken the time to address the key area of concern relating to this bill, and that's the new medical device excise tax. the new 2.3% tax on medical device sales that was imposed in the federal health care law will cost our economy thousands of jobs and limit americans' access to the most ground-breaking state-of-the-art medical devices which many people need. for the past 18 months, i have been pushing for the senate to consider a medical device tax repeal bill that i introduced back in february of 2011, one of the first bills that i introduced, and today i along with others will be introducing an amendment to repeal this job-killing tax, a tax which will in fact drive up the cost of health care and care for patients and make our workers and our companies less

competitive. i can tell you in massachusetts, we have over 400 medical device companies. we're an innovative state. we have the ability to have companies like this in massachusetts employing nearly 25,000 workers and contributing over $4 billion to our economy, and that is obviously a substantial industry in massachusetts, and it affects each and every person throughout this country indirectly. if it goes into effect next year, this harmful tax will put american workers at a competitive disadvantage and chase jobs overseas. there is already companies that have been over the last year and a half looking overseas, already shifting their strategy. where is that money coming from? where that 2.3% tax that in some instances represents the entire net profit for some of these young companies in massachusetts and throughout the country. it will potentially cost 43,000 jobs across the country, with a

loss of $3.5 billion in wages. i'm not quite sure how that makes sense in anybody's book. massachusetts alone is expected to lose over 2,600 jobs as a direct result of this tax and up to 10% of our entire medical device manufacturing work force will be afgd. affected. we can't have this type of job loss in our economy when we're still struggling. we're a innovative state. we have over 400 medical device companies in massachusetts. we do generate a tremendous amount of revenue and the billions of dollars, so where is this tax going to come from? is it coming from r & d, from growth, expansion, hiring, firing? no one seems to know. i can tell you that the massachusetts companies and companies throughout the united states are deeply, deeply concerned about this. and i find it surprising and disappointing that there is not a consensus to repeal the medical device tax which will affect states across this great

country, whether it's on a bill or a stand-alone bill we need to get it done and get it done like we did in a truly bipartisan, bicameral manner on the 3% withholding, the 1099 fix, the hire a veteran bill, the insider trading bill. we've worked together in a bipartisan manner to get things done. it matters a great deal to massachusetts and should concern every member of this body. madam chair, i thank you and i note the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

the presiding officer: the senator from illinois. mr. durbin: i ask unanimous consent the quorum call be objected. the presiding officer: without objection. mr. durbin: i ask to speak in morning business. i withdraw that. it's my understanding we're on the f.d.a. motion? the presiding officer: that is correct. mr. durbin: my statement relates to that bill so i will speak as part of that. dietary supplements have become a common health aid in medicine cabinets across america. more than half of us in america use dietary supplements including this senator, who for a variety of reasons takes a multivitamin tablet every morning. in spite of their popularity, many people would be surprised to learn that the food and drug administration doesn't know how

many dietary supplements are being sold in the united states. most people don't know that if a date taxpayer supplement ingredient presented serious health concerns the food and drug administration doesn't have the information to track down products containing the harmful ingredient. we assume if it's for sale in america, some government agency is taking a close look to make sure that that product is safe and that we know what's inside of it and that it wouldn't harm a customer, an innocent customer. turns out that may be true when it comes to prescription drugs and over-the-counterrer drugs but the -- counter drugs by the dietary supplement drug world is a much different world with minimal regulations. i have an amendment to ensure the food and drug administration has the information it needs to respond quickly and efficiently when safety concerns arise concerning dietary supplements. this would require date taxpayer supplement manufacturers give the food and drug administration the name of each supplement they

produce, along with a description, a list of ingredients, and a copy of the label. it's not an onerous requirement but for the first time the food and drug administration would literally have a catalogue of all the date taxpayer supplements being sold to americans all across the nation. now, with this information the f.d.a. is better equipped to protect consumers' health and to work with manufacturers to address any problems if they arise. the 2009 report by the government accountability office found that the food and drug administration is limited in its ability to respond to safety concerns because dietary supplement manufacturers don't always provide basic information, like product names or lists of ingredients. this commonsense amendment that i'm offering is supported by the consumers union, and it would give the food and drug administration basic information it needs to protect the public. trust me, it will be opposed by certain interest groups. but i heard opposition almost

ten years ago when i introduced a bill to require dietary supplement manufacturers report serious adverse events, like hospitalizations or death to the f.d.a. the need for mandatory reporting of adverse events was demonstrated by injury and death across the country caused by popular and dangerous dietary ingredients like ephedra before it was banned in the united states in 2004. one of the victims was 16-year-old sean riggins from lincoln, illinois, 30 miles from where i live in downstate illinois. he died in september, 2002, a high school student after he took something called yellow jackets. it was supposed to be an energy boost and he was headed off to play football. it contained ephedra and it killed him. shortly before his deft, metaba life claimed to the public that they had no ephedra-related

adverse event reports, period. however a la plata lawt was filed -- a lawsuit was filed and they were required under that lawsuit to disclose their records. in october of 2002, under pressure, they gave f.d.a. over 13,000 ephedra-related adverse event reports. people had taken their substances with ephedra, got sick or worse. in 2006, i worked with senator orrin hatch of utah and tom harken of -- tom harkin to pass the amendment which mandates reporting of adverse effects to the food and drug administration. stands to reason, if there's a drug for sale in the united states, dietary supplement in this case, causes a problem, shouldn't we know about it? if if it's causing a problem in a lot of different places, if the food and drug administration will discover it. since the law took effect in

2007, dietary flement splement add ver event reports submitted to the f.d.a. have increased sevenfold from 368 in 2007 to 2,473 in 2011. the f.d.a. is using these reports as part of a surveillance system to signal potential safety issues and in some cases take regulatory action. mandatory reporting of adverse events was an important step to protect consumer safety, but we wee need to do more to ensure the f.d.a. and consumers have the information they need. madam president, the sad reality of this amendment and this issue is that it takes a tragedy to catch our attention. someone has to be seriously hurt or worse before members of congress and others will take notice and do something. i recently learned about the tragic death of this beautiful young 14-year-old girl. her name was anise forier from

maryland. she was an honor student, liked to read vampire novels, watched chick flicks with her mom and had a passion for writing. last december, her life was cut short when she went into cardiac arrest. what caused it? caffeine toxicity. she drank two 24-ounce monster energy drinks in less than 24 hours. and it took her life. the american academy of peed rat yathd tricks recommends that adolescents like anise consume no more than 100 milligrams of caffeine every day. but in less than 24 hours she had consumed 480 milligrams of caffeine. that's the equivalent to 14 12-ounce sodas with ordinary caffeine content. she did it with two drinks. a recent report by sam is a --

samsa shows that it poses potentially health risks. in the gallery today are members of anise's family. we join them in mourning her loss in the hope that her life will at least give us notice that there are things we can do to spare other families from the grief that their family has gone through. windy crossland is her mom. her sister jade is here, her grandfather dick and grandmother faith. they've come here today because they are hoping that the senate will hear about this amendment and that we can take it up and pass it. her case is not alone. emergency room visits due to energy drinks have increased tenfold between 2005 and 2009. from 1,128 in 2005 to 13,114 e.r. visits in 2009. energy drinks target kids. with flashy ads and names,

monster, rock star, five-hour energy drink. but there are serious concerns about the high levels of caffeine in these beverages and herbal ingredients that contain even additional caffeine. the f.d.a. -- this is the interesting thing. if you walk in, as i have, to an ordinary gas station, whether it's in new hampshire or in illinois, and you see the cooler there with the drinks in it, and then you'll see some others on counters, you might assume, well, they're all subject to the same level of regulation. but it's not true. if you're talking about ordinary beverages, sodas, they're characterized as food, and they are subject to certain limitations by the f.d.a. however, if you look at the fine print -- and you better look closely because it's very tiny, you may find this is being characterized and described as a diet taxpayer supplement. by changing, putting those two words on the label, they escape

regulation. so we limit the caffeine in an ordinary soda pop, for example, a ceel, but when it comes to the dietary supplement side of the story, there are no limitations. that's why this poor young lady, this poor young girl, was a victim because of the huge amount of caffeine that was consumed in the name of a dietary supplement. the f.d.a. has the authority to regulate caffeine levels in beverages, and to require beverage manufacturers to prove the additives they put inside that can or bottleer safe. -- are -- bottle are safe. but most avoid it by calling their products dietary supplements. i defy you to walk into a store and look at that case of all the things you can buy and pick out the ones that are regulated by the f.d.a. and those that aren't. you're going to have to study long and hard, and look closely at the labels to figure it out.

is that fair to consumers? is it fair to families and parents that we don't have even basic oversight and regulation over products that can literally harm or take the life of a beautiful young girl like this? the amendment i'm offering would ensure that the f.d.a. knows about all of the energy drinks being sold in the united states and may provide information about ingredients that could help the agency address potential safety concerns. now, most dietary supplements available today for sale are safe. and are used by millions of americans as part of a healthy lifestyle. some ingredients may be safe for the general population but may be risky for kids, pregnant women, or people with a heart condition, or certain -- taking certain prescription drugs. furthermore, in spite of the many responsible dietary supplement companies, sadly, there is a murky market space out there where some bad actors are selling potentially

dangerous products, some of them imported into the united states, which literally do not even disclose their ingredients in an accurate way. this amendment will take an important step to protect the public health by requiring dietary supplement manufacturers to submit basic information to the f.d.a. that would help the agency identify safety issues and respond more quickly. no one wants to learn of the death of another 16-year-old who loved to play football or of this wonderful young 14-year-old girl who loved watching movies with her mom. we can help prevent these tragedies by requiring that better information is reported to the f.d.a. when these dietary supplements go on the market. madam president, i yield the floor. the presiding officer: the senator from georgia. mr. isakson: as a member of the health, education, labor, and pension committee i rise for a brief speech but i want to begin by thanking chairman harkin, ranking member enzi, the entire

staff of the help me and my staff who have helped so much on this legislation which is so important to the american people. this is a chance where we have a bipartisan effort in the united states senate to do something constructive and meaningful and i commend both of them on their work. there are component parts of this legislation i want to illuminate for just a second because i had a lot to do with them because they're very important. one deals with third party logistics providers. as the chair is aware and the senate is aware we have a placeholder in in the manager's amendment for third party providers with track and tracks trais. it's the mechanism of tracking the drug from its origin to the individual using the drug to make sure we have safety and security. but there are third-party logistics carriers to deliver an awful lot of content like fed ex and u.p.s. who operate in all 50 states and we ought to have a too-state seamless delivery rather than 50 states all having

regulatory authority. so my first message today to send to the conferees when the committee is ultimately reported is to take these placeholders on these third party providers and in the track and trace regulations we provide a seamless policy. it's very important to our country and to the pharmaceutical industry and mostly it's very important to those of us who consume those pharmaceuticals. secondly, there is another provision called the medical gas act, gas safety act, which was included in this legislation and i am very grateful that the managers of the legislation agreed to put it in the bill because it's equally important for our people in this country. but i want to make sure one thing is underlined. medical gases are critically important to sustain life, gases like oxygen, like night truss oxide, called by laughing gas. but i want to make sure as we go through this process we have a system where medical gases that

have stood the test of time remain available through medical use and brand-new medical products that have never been through the testing time go through an appropriate f.d.a. review which is what the original act, the medical gas safety act included, and wanted to be included in this legislation. madam president, i would ask unanimous consent that the statement both on medical gas and the statement on third-party logistical providers be included in its totality for the record. the presiding officer: without objection. a senator: and i commend the chairman and ranking member again on their service and the fine work on the f.d.a. bill. and i yield back and suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call: