regulations, and that's not what we want to happen. this is the time for rational, thoughtful discussion and legislation that will begin a process that will go on for years because the cyber threat is not going away. so -- so that's title 1. that's the compromise we offered on title 1 which deals with cyber infrastructure. i go now to title 7. there are some very good titles, 2-6. but the good news is -- maybe i should stress this -- there seems to be broad partisan agreement on those titles. title 7 is the one on information sharing, and there is some disagreement on that. but we have come to agree that private sector companies must be able to share cyber threat information with the government and each other, with protections against liability that will incentivize, really allow that sharing. that this sharing must be

instantaneous. in other words, to protect -- to respond to concerns about private data being shared when a private sector operator of cybersecurity shares information with the government, we are requiring in this bill, the pending legislation, that the first point of contact for cyber sharing and reporting a cyber attack is with a civilian agency. not a military or law enforcement agency or an intelligence agency. a civilian agency like the department of homeland security or some other approved civilian exchange. some people have worried that if we did that, it would delay the referral of that information to the law enforcement and intelligence and military parts of our government, almost as if when the information of a cyber attack is sent to the department of homeland security, somebody is going to have to go find the

secretary of homeland security to make sure she sees it before it goes to the department of defense, f.b.i. the world we're in is very different from that. it has been explained to me and others that they met with, particularly general alexander, the head of our cyber command at the department of defense, everything travels instantaneous ly at cyber speed, and that means that according to preset programs of cyber attack if this bill is passed, that notification of it will go to the department of homeland security and at the same instant it will go to the department of defense, the f.b.i., the intelligence community. when it first goes to that civilian exchange, there will be software in there to screen out -- to prevent the possibility that any personal data, emails, private financial information will not be sent to

the -- to the law enforcement and defense branches of our government. in other words, the sharing will have to be instantaneous. that existing information, sharing relationships will continue undisturbed. for instance, between a defense contractor and the defense department and that there shall be no stovepipes among government agencies, agencies that need information should have access to it the instant it is provided to the government. i know that some colleagues want more assurance that while a lead civilian agency will serve as the hub for immediate distribution of cyber threat information, it will do so without slowing down d.o.d. and n.s.a. abilities to access and act on that information. i am just told that will be the case. others want to add further privacy protections. i do want to say in this regard

that we have already significantly strengthened the privacy protections, thanks to a lot of good negotiation with a group of senators, senators franken, durbin, coons, wyden and others, and a broad range of privacy and civil liberties groups ranging quite remarkably from the left to the right and in between who seem generally pleased with what we've done to protect privacy under our legislation, and here's the good news. the people in charge of cybersecurity in our government say that the privacy protections that we have added in the underlying bill to the information sharing section of this bill will not stop them for a millisecond from receiving the information they need and protecting our national security. so to me this is the senate at its best. we're not there. i mean, my dream here -- because this is -- we're legislating

here. not in the midst of some traditional sort of, you know, business government regulation controversy. we're legislating actually in the midst of a war because we're already being attacked every day over cyberspace. we have been lucky that it hasn't been a major attack that has actually knocked out part of our cyber infrastructure, but that vulnerability is there. a few months ago, there was a story in "the washington post" about a young man in a country far away that launched an attack against a small utility. i believe it was a water company in texas, and got into their system and actually had the ability to totally disrupt the water supply in that area of texas. what he did instead -- the hacker did instead -- and nobody was -- he just had a computer

and was smart. what he did instead was post proof that he had broken into the industrial control system in that small utility in texas just to show the vulnerability, in a sense he might have been bragging that he could do it, but it was also a warning to us. what if the next time that happens it's a larger utility or a group of smaller utilities around the country, maybe water, maybe electricity, maybe gas, and this time they're not just warning us or showing us our vulnerability but they're actually going to disrupt the flow of electricity or water to people who depend on it. that's -- that's the kind of crisis that we face and why it is so urgent that we deal with this. so let me come back to my dream.

my goal here is that as we go on this week, we're able to submit a manager's amendment, but it's not just from the managers, senators collins, rockefeller, feinstein and i. we're joined by a much broader group and we form a broad bipartisan consensus here to protect our country from a terrible danger that is real, urgent and growing. mr. president, i always like to -- i was thinking about it again in this case -- think back in these moments. since i don't see anybody else on the floor, i will undulling myself and go back to a hot july day in philadelphia -- indulge myself and go back to a hot july day in philadelphia when years ago the united states senate was created as part of the, i'm glad to say, proud to say, the connecticut compromise offered to the constitutional convention by two of connecticut's delegates to that convention,

roger sherman and oliver ellsworth. it passed by just a single vote but it helped keep the convention together and to enable our new government, including our congress, to take shape because the connecticut compromise guaranteed the small states that their interests would be protected, small population states in the senate, because every state, no matter how big or small its population, would have two senators. and it guaranteed the larger states that they would have a greater say in the house of representatives, which would be -- its membership would be reflected, as it still is today, by population. not everyone got everything they wanted that day, but they found a common ground that allowed them to go forward and finish writing our constitution. and that's the kind of position that we are in today.

shortly after the connecticut compromise was adopted at the constitutional convention, james madison -- as you know, mr. president, often referred to as the father of the constitution -- wrote, and i'm paraphrasing a little bit here, the nature of the senatorial trust would allow it to proceed with coolness and wisdom, end of quote. these negotiations on the cybersecurity act of 2012 i think show thus far that we have the ability to put ideological rigidity, partisanship, politics aside when our security is at risk and move beyond gridlock and fulfill our founders' vision of what this body can do when it comes to debating the great challenges of our time, with coolness and wisdom, as madison

said. so over the next couple of days, mr. president, let's debate all the relevant and germane amendments. let's start voting as soon as we can on them, but then for the good of the country, let's each compromise some, acknowledging no one of us can get everything we want and we can't afford to insist on everything we want, because if we do nothing, it will happen and our country will remain vulnerable to cyber attack until the next opportunity congress has, which i guess would be sometime as next year goes on, to deal with this challenge. we can't wait. we simply cannot wait. so i -- i know we can do this. i urge my colleagues therefore to come to the floor, i urge the leaders of both parties to agree that the amendments submitted should be germane and relevant and that we can and will finish our work on this legislation

this week. i thank the chair. i yield the floor. i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

quorum call:

a senator: mr. president? the presiding officer: the senator from new jersey. mr. menendez: i ask unanimous consent the quorum call be vitiated. the presiding officer: without objection. mr. menendez: mr. president, i ask the opportunity to enter into a colloquy with the majority leader, senator reid, and the distinguished chairman of the finance committee, senator baucus. the presiding officer: without objection. mr. menendez: mr. president, let me begin by clearly stating i understand the majority leader later today will issue a unanimous consent request to move forward on the african growth and opportunity act trade

bill and the burma sanctions package twels cafta d.r. those are all efforts that i supported as a member of the finance committee, voted for and ultimately want to see passed. i believe that trade is an effective development tool and that by investing in people we can make a long-term and sustainable change in developing countries. but at the same time, mr. president, i'm very concerned about our failure to reauthorize the cotton and wool trust funds which are crucial to sustaining jobs in the united states and jobs in my state of new jersey. for the past -- well, for some time now i have been working tirelessly to reach an agreeable resolution on this issue, one that enables us to pass agoa and burma sanctions while simultaneously protecting apparel sector jobs in the

united states, hundreds in my home state, thousands across the country, and ensuring that our trade isn't just free but it's also fair, and that just isn't the case right now. i come to the floor to enter into a colloquy with the distinguished majority leader and the chairman of the finance and ask their help in addressing the cotton and wool trust funds this year so we can seek to move this legislation and do the right thing by american workers as we are trying to also help african workers. and i'd yield to the distinguished majority leader. mr. reid: i appreciate the senator from new jersey coming forward to discuss this issue. as my friend from new jersey knows as the chairman of the finance committee knows, i support the wool and cotton trust funds and that's very clear in the record of this body for what i believe was wrong with the olympic uniforms.

such a shame that our athletes over there wearing clothes made in china. i think that's too bad so i support the wool cotton trust and i support the citrus trust fund. there are only three of them and i support all of them. i agree with my friend from new jersey we need to find a way to move these forward hand ensure american family manufacturers are placed on equal footing with foreign manufacturers so there is an easier place for people to go if if they want products made in the united states. i'm happy to work with senator menendez and chairman baucus to find a vehicle to ensure these american jobs are a priority that is addressed this year. so my friend has the commitment i will do everything within my abilities to make sure we have an agreement on extending these very important trust funds this year. the presiding officer: the senator from montana.

mr. baucus: mr. president, i strongly endorse the suggestions made by the majority leader as well as by the senator from new jersey, and also thank the senator from new jersey for pushing these measures so aggressively, the cotton trust fund, wool, and also to some degree the citrus which is part of this. i support these provisions. i support the cotton you trust fund, support it strongly and have working diligently to try to find the right vehicle to try to get this passed, the cotton trust fund passed this year. i deeply appreciate your strong passion on this, senator menendez, you've come to me many, many times, and looking for an opportunity to pass this, and i deeply appreciate that. we have -- this place works on basic comity and sometimes the pathways to get the result are not well known, and difficult to see initially, but i am quite confident this year we're

going to find a path way, find a way to get the cotton trust fund passed this year. you have my support to make that happen. mr. reid: before i yield to my friend from new jersey i want to state on the record that no one is a better advocate for an issue they believe in than senator menendez from new jersey. this is an issue he has spoken loud and clearly about, and so i reiterate what i said, i feel very, very compelled to do something to satisfy my friend from new jersey on such a worthy cause. the presiding officer: the senator from new jersey. mr. menendez: i want to thank the majority leader and the chairman's ongoing commitment to this issue and i look forward to continuing to work with them on the issue to protect american workers and american manufacturers from the negative effect of certain trade policies and tariffs that threaten their livelihoods. i appreciate them both coming to

the floor and to their commitments. i want to take a minute or two for those who have asked me, hive had a whole host of our colleagues who have come and said what are you trying to achieve, so that we can move quickly to try to achieve the passage of agoala or cafta, burma sanctions, all of which i support. i know that colleagues like are the author of agoa has called. pursuant to the passage of nafta and cafta and agoa, congress has eliminated duties, for example, on imported shirts from other countries and in some cases it's allowed the use of third-country fabrics to make those imported shirts. our tariff policy, however, has not changed and while foreign-made dress shirts are entering the united states

duty-free, we are charging american manufacturers a duty as high as 13.5% on cotton shirting fabric. not surprisingly, this made in america tax resulted in american manufacturers moving production offshore where shirting fabric is not subject to those high duties and where the finished product can come back to the united states duty-free. so six years ago, congress recognized that, in fact, that is simply unfair. why should an american manufacturer have to pay a duty when those abroad using the same fabric can send it to the united states without any duty. they created the cotton trust fund to provide a combination of duty reductions and duty refunds to shirt manufacturers who continue manufacturing in the u.s. now, that program expired in 2009, and since then, these businesses have suffered and dwindled. i'm just simply trying to, as

we promote jobs in africa and in the caribbean, i want to appropriate jobs here in the united states. i want the women in the factories that i have met that this is the essence of how they sustain their families, to be able to continue to have those jobs, mr. president. and that's why i appreciate the effort by the chairman and by the majority leader to try to get us to that point so we can have free trade but also has to be fair to americans who are here and can compete but can't compete when they have to pay 13.5% tax and people sending in from all over the world have to pay nothing. that's the essence of what i'm trying to accomplish. i will not object when the majority leader proposes his -- his unanimous consent request and will support the effort to move those trade bills. i'd be happy to yield to my colleague from maryland. the presiding officer: the senator from maryland. mr. cardin: let me thank senator menendez for his leadership on

this issue. he has been very articulate about preserving jobs and creating jobs in new jersey and america. i just want to thank him for once again standing up for american workers. let me thank senator reid, our majority leader, for his commitment to bring up these trust funds, and the chairman of the finance committee, senator baucus, i want to thank you for your leadership. senator menendez has laid out the issue. you've laid out the issue very clearly. this is an averted tariff. it works against american workers. cotton mainly in shirts but other commodities, wool and suits. what happens is, as senator menendez, you have pointed out, if you manufacture the suit or the shirt out of america and then import it into america, costing us jobs, you pay less tariff than if you are an american manufacturer who imports the product to manufacture the product in america, you pay a heavier tariff which costs us jobs, which makes no sense whatsoever.

so i -- i want to thank senator menendez for your leadership. i want to thank our leadership of senator reid and senator baucus for understanding this and giving us an opportunity before this expires on the wool trust fund, it's making sure it works effectively. i took the floor last week to talk about english-american tailoring which is located in my state of maryland, in westminster, maryland. 380 union jobs in westminster, maryland. i showed a photograph of sewers making suits in america. i think most people thought that photograph was taken decades ago. it was taken this month about how we can preserve jobs in america. they're making the best suits in the world. they are exporting their suits to other countries, but they can't do it unless we have a level playing field. and your leadership, senator menendez, on bringing to the

attention of the american people the need to extend and make effective the cotton and wool trust funds is critically important to preserving jobs in maryland, in new jersey and in our nation. so i just really wanted to thank you on behalf of american workers for your leadership on this issue. mr. rhode reid: would my friendw me? i ask unanimous consent the period for debate on s. 3414, the cybersecurity bill, be extended until 5:00 p.m. today, and at that time i be recognized. the presiding officer: without objection. mr. menendez: i want to thank my distinguished colleague from maryland, a fellow member of the finance committee, senator cardin has been a passionate voice on this as well. i am thrilled to have him as an ally in this endeavor. all we want is for americans to stay employed. they can compete with anybody in the world, but they can't compete when they have to pay a tariff, a tax that no one else

has to pay who sends the same product back into the united states. that's what our goal is here, and i appreciate his work, his passion, his commitment. i look forward to working with the majority leader and the distinguished chairman of the finance committee. with that, mr. president, i yield the floor. mr. lieberman: mr. president? the presiding officer: the senator from connecticut. mr. lieberman: i thank the chair. was the president about to -- you were about to -- okay. let me, if i may, have a few moments. i thank the chair. the senate has not gone into a quorum call, has it? i don't believe so. the presiding officer: there is no quorum call. mr. lieberman: i thank the chair. madam president, very briefly, i have just received a copy of a letter that has been sent this morning to the majority leader, senator reid, and the republican minority leader, senator mcconnell, from keith

alexander, general of the united states army, director of the national security agency and chief of cyber command at the department of defense. a distinguished and honored leader of our military, one of the people who has the greatest single responsibility for protecting our security, both in tems of the extraordinary capabilities that the national security agency has but now increasingly for the defense of our cyber systems. i think this is a very important -- this is a career military officer. this is not a politician. this is somebody who has a mission, and it's from that sense of responsibility that senator -- that general alexander has written to senator reid and senator mcconnell. he writes -- i'm going to enter this into the record in a moment, but he writes to

express, i quote -- his strong support for passage of a comprehensive bipartisan cybersecurity bill by the senate this week. why? and i continue to quote. the cyber threat facing the nation is real and demands immediate action. the time to act is now. we simply cannot afford further delay, general alexander says. and he adds to be most effective in protecting against this threat to our national security, cybersecurity legislation should address both information sharing and core critical infrastructure hardening. and then he explains both of those in very compelling language. finally, he says any legislation needs to recognize that cybersecurity is a team sport. no single public or private entity has all of the required authorities, resources and capabilities. within the federal government, the department of defense and the intelligence community are now closely partnered with the

department of homeland security and the federal bureau of investigation. the benefits of this partnership are perhaps best evidenced by the managed security service program which affords protections to certain government components and defense companies. the legislation, that is s. 3414, will help enable us to make these same protections available widely to the private sector, end of quote. so i can't thank general alexander enough. he ends by saying the president and the congress have rightly made cybersecurity a national priority. we need to move forward on comprehensive legislation, and he urges senators reid and mcconnell to work together to get it passed. mr. president, i ask unanimous consent that this very compelling letter from general keith alexander be entered into the record. the presiding officer: without objection. mr. lieberman: i thank the chair. i yield the floor.

the presiding officer: under the previous order, the senate stands in recess until 2:15 p.m. stands in recess until 2:15 p.m. they will be back at 2:15 p.m. eastern for more discussion on cybersecurity issue. we will have that live for you here on c-span2. coming up live later, a senate foreign relations subcommittee looks at the business climate in latin america. coverage starts at 2 p.m. eastern on c-span3. join us later when the house rules committee considers legislation dealing with the u.s. tax code and job creation. we expect discussion on extending the bush-era tax cuts. watched that live starting at 5 p.m. eastern on c-span3. >> we have to be really clear about the very many ways that we

on ourselves. and we own of history. and that we make decisions that our history is phenomenal, vital, and special spent the former president of bennett college, julianne malveaux, rights and comments on politics, education and african-american economic history. this sunday your questions, calls, e-mails and suites for the author of surviving and thriving. julianne malveaux in depth live at noon eastern on c-span2's booktv. >> mathematician and economist steve landsburg outlines the beginning of economic growth in industrialized world at the cato institute's annual conference on liberty yesterday. he linked economic freedom since the dawn of the industrial revolution with innovation and economic growth. this annual program looks into the economic, political and historical foundations of liberty. this portion is about an hour and 20 minutes.

>> all right, good morning. i promise that we would begin on time, and nearly 23 seconds the early, so we are off to the right start. just a couple of quick points. we will have presentations, presenters will be up here, or someplace around here, for the discussion with two microphones here. and so, once we're done with the presentation, you want to pose a question, just come on down here. if anyone has limited mobility, we want to make sure everybody can be included in the conversation. i recommend sitting nearby these microphones if that's an issue, or if there have been series

problems we'll make sure someone can bring a microphone to but i would rather not make that the standard, so people should line up. but again if you have any limited mobility problems, that's not a problem. we can take care of that. our first presenter to get us off to the proper start, professor steven landsburg. stephen is a mathematician by training but he's an economist by profession and passion. he's a great teacher and explainer of economics, a couple of good things. in addition to his a bio which you can go and check, we posted it online, he has a new edition of his wonderful book, the armchair economist, fully updated for the 21st century with data and updates and the contemporary examples. he blogs daily as thebigquestions.com so you can check his blog. he will be blogging while here as well. and he's nearly finished with another book, part of his wide range interest on the theory of

relativity. steve landsburg. [applause] >> thank you. microphone working? good. i want to talk to you about economic growth come and the start of economic growth begins about 100,000 years ago when modern humans first emerged. and then we've got the timeline here. for the next 99,800 years or so, nothing happened. [laughter] nothing happened. there were, oh, you know, there were some wars, it was some political entry, there was the renaissance, but none of that mattered. none of that mattered in the sense that none of it at any appreciable effect on the quality of life for any substantial number of people. from the dawn of history up until about 200 years ago, just 10 generations, nearly everybody

who ever lived, lived right around of the modern equipment and 8400, 6-under dollars a year. oh, there were times and places where it was a little better than that, even some extremely fortunate times and places where people armed maybe the land of $11,000 a year per day, $1000 per year in today's turn. and, of course, there were always i know buildings, teens and queens and dukes and princes who lived much, much better, but they were numerically insignificant. so if you had been born anytime prior to the industrial revolution, prior to about 200 you to go, the odds are astronomical touch would've lived on the modern equivalent of 400, 600, or if you were extremely lucky, $1000 a year, just like your parents, just like your grandparents, just

like your children, and just like your grandchildren. been a couple hundred years ago something happened. incomes at least in the west started to rise. by the year 1800 incomes are rising at about three quarters of a percent per year. a couple decades later, that would happen around the world. then it got better. just 20 years later incomes were rising at 1.5% a year, this was unprecedented, this sustained growth. it had never happened before in history of the world. since 1960 in this country, per capita growth, that's per capita growth corrected for inflation. that's income per person has grown at about 2.3% a year. to translate those percentages into something concrete, let's think about what that means for a typical middle-class family. suppose that you're a

middle-class person with a modest income of let's say $50,000 a year. then at that 2.3% growth rate that we have sustained for the last 60 years or so, if we continue at that growth rate, then in 25 years, your children will be earning the inflation-adjusted equivalent of $89,000 a year. and if we continue that growth rate their children 25 years after that, they'll be earning to the input of 150,000 per year, from 50,000, to 89,000 to 150,000 in two generations. that's the power of economic growth. and if you extrapolatehat out a little bit further, let's say another 400 years at 2.3% growth per year, then your descendents will be earning approximately $1 million per day -- [laughter] unless of course they rise above

mediocrity and live a little better. and i want to stress that these are not some future inflation ravaged dollars we're talking about. this is after correction for inflation. that's the equivalent of a million of today's dollars. i don't know whether we're ever going to reach that point, 400 years from now, but i do know that it's a conservative extrapolation from a centuries old trend. it's conservative, it's conservative because it assumes that we're going to continue that 2.3% growth rate for the next 400 years, whereas in fact what has happened since growth first started to wonder just ago, it's the growth rate itself has continually risen. if you find this an impossible number, you might pause and reflect for a moment on how implausible your lifestyle might have sounded if i try to explain it to somebody 400 years ago. you might also meditate on the

history of skepticism. this guy is julius who in 100 aei observed they have long since reached their limit, there's no hope for future development. this is the history of per capita income in the tourney. the united states is sort of a medium growth country. our growth compared to other countries has been steadier and it started earlier than most which has been very good for us, but on average we are a pretty average country in terms of the level of growth. this is all corrected for inflation. this is all 2005-dollars. and you can see that incredible march of prosperity over the years. we have just had of course a pretty rocky couple of years. is only goes up to 2010, but you can see the dip at the beginning of the crash. that's the kind of thing that happens from time to time. it happened most spectacularly

in the 1930s here where we had a great depression. here's what happened in the great depression. incomes fell back to where they had been about 25 years before. and people found it intolerable. they have to live the way their parents live and effect it intolerable. they had to live at a level which their great grandparents would have thought unimaginable luxury, and they found it intolerable. that's a much we have internalized the idea that things are supposed to be getting better. but that's a new idea. nobody before the industrial revolution thought that. today, we expect our cars and her entertainment systems and computers to keep dazzling us with something new every year. we expect that by the underlying expectation is new. in the 18th century, here's something you never saw any 18th century. a politician asking are you better off than you were four years ago? nobody asked that because in

18th century, nobody expected to be better off than they were four years ago. it's not just incomes. let's look at what happened to our leisure time. 100 years ago the average work in this country is 35 hours. today it is three for just 100 is ago 6% of manufactured workers took vacation. today it's virtually 100%. in 1910, 26% of 65 year-old men were retired. that's at a time when most men didn't make it to 65 of those who made it to 65 they were really old, three quarters of them were still working. today, 90% of 65 year-old men are retired. child labor was common in 1910, boys entered the workforce routinely in their early teens. today in this country it's practically unheard of. so we are working less per week,

fewer hours per week now. we're working fewer hours per year. fewer weeks per year. fewer years per lifetime. the average housekeeper in 1910 spent 12 hours a day on laundry, cooking, sweeping, cleaning. today, it's about one and half hours. here is a typical housewife's laundry day in the years 1910. first, she poured water to the stove, heats it, or is it into the big tub, washes the close in the tub, rings up each individual item separately, either by hand or with a mechanical wringer, and then moves on to the oppressive task of ironing, using the heavy flat iron that was continuously heated over the hot stove. the entire process in the year 1900 takes eight and half hours. she walks over a mile in the process. we know this because the united

states government used to hire researchers to follow housewives around as they do their laundry, and count every step. and we know from those old research studies that doing the laundry required eight and half hours and a mile of walking. by 1940, our heroine has a washing machine, and our laundry day is down to two and a half hours and she walks 665 feet. today, nobody spends to have hours on their laundry. throw the laundry in, and if you're one of those really new fancy machines, he knows you to let you know when it is done. [laughter] it's not just laundry but it's not just cooking and cleaning and sewing. in the year 1900, most houses in this country did not have central heat. did not have plumbing pics of other routine household tasks included lugging seven tons of coal and 9000-ounce of water around the house every year.

just since 1965, just since 1965, the average american had been six hours a week of leisure. that's the amount of time that we spend in the office or commuting is down by six hours a week for the average american. that's equal to getting the seventh extra vacation weeks per year. that's just over the last 40, 50 years or so. so, we are getting richer. we are working less your and on top of that, the quality of the goods we buy is improving. if you doubt that, go pick up a 40 year old sears catalog, leaf through it, and ask yourself if there's anything in there you want to buy. here's a couple pages from a 40 year-old sears catalog. you can get this am radio with separate phone control. it weighs two pounds nine ounces. that's exactly twice as much as an ipad. one transistor comes with a battery.

you could get this black and white camera which takes up to eight pictures, and then you replace the film pack, which probably costs about as much as the camera does so you can take another eight. you by the separate flashbulbs and you screw the flash bulbs into the camera every time you want to take a picture and, of course, they come in packs of 12. when you run out of those you have to replace those. the only thing is that these pictures are a little misleading. they are misleading because you're seeing the 40 year-old prices. we really ought to correct those for inflation. those are what the prices are corrected for inflation. $120 for the transistor radio, $210 for the eighth picture camera. and i guarantee you it takes a picture far inferior to what you get off your iphone. or it's not just electronics. take a product like health care. here's a shocking number. if you look at the quality of health care in the poorest parts

of africa today, and if you control for the effects of aids, and there's an argument for doing this and there's an argument for not doing it, but if you say the, aid is a special one time thing, that is not part of a general trend of health care so i'm going to take the effects of that out. been healthier outcomes that we are seeing in the poorest parts of africa today measured by infant mortality, measured by life expectancy, by pretty much anything you want to measure, are almost exactly the same as what we're seeing in the united states of america in 1975. 1975 in the united states you're getting the same quality of health care as the poorest africans are getting today. now i want to ask you, which would you rather pay, which are rather they 1975 prices for the 19th of health care or would you rather pay today's prices for today's health care?

i venture to guess there's not an informed person in the world who would choose to go back to 1975, and that's got to do that for all the problems with our system and all the hype about rising cost of health care today is a better bargain than it has ever been. the moral of all that is that increases in measured income, even the phenomenal increase in measured income that we've seen for the last 200 years, grossly understate the story of how rapidly the world is getting better. henry viii had a much higher measured income than nearly anyone in this room, and certainly nearly anyone and probably than anyone in this room. he ruled half of england, but i bet you he would've traded half his wealth for modern plumbing, a lifetime supply of antibiotics, and access to the internet. now, along with all of that wealth that we have generated, has come another brand-new

phenomena, wealth inequality. per capita income in the united states is 70 times what it is in the poorest parts of africa. the world has never seen any called on that level before. that's brand-new. do know where -- deal by the phenomenon is new? because wealth is new. the reason with all this inequality for the first time is that we wealth for the first time. and if you think inequality is a problem, it's worth reflecting that it is at least a tremendously fabulous problem to have. it's the problem of how to divide up all this amazing wealth that nobody would've ever predicted we'd be able to generate in the first place. if you want to take the issues of inequality, and i'm not going to go into great depth with that today but if you want to mention a couple things that you want to keep in mind when you think about any called the first of all, nobody in the world today is poor and it would've been been before the industrial

revolution. i know that because if you were for and you would've been before the industrial revolution, he would have starved to death by now. another thing to keep in mind is that economic growth is new. it's only a couple hundred years old. we have been about for a hundred thousand years. this process is just getting started. it's just getting started and it has started some places later than others, and in some places -- but we have not begun to see the power of what economic growth can do on a worldwide basis. and we should remember, too, that in the long run a rising tide list all boats. here, after all, is what economic growth has done for the poorest americans. let's look at households below the poverty level in america. 98% have refrigerators. 67% have washers and dryers.

96% have color tvs. 75% of those with over 300 channels. i grew up with three black and white channels. 68% have air conditioning. many of the others live in climates where air-conditioning is superfluous. 63% have internet access. households below the poverty level. when you survey people at that level, and ask them to you have enough food, 93% answered yes. do you have any smoker orders that bother you in your neighborhood? 93% say no. any unmet medical needs? 86% say no. in the road or ceiling leaks? 90% say no. it is more difficult to leave the life of a poor american thank you lead the life of most americans in this room. but it is the difference between that light and the life that

everybody took for granted 100 you to go, is almost unspeakably great. beyond that, you remember those leisure games i mentioned a little early. i said that the average american has been the equivalent of seven vacation weeks per year just in the last four years. that's been distributed and equally in fact. the poorest americans have gained twice as much, the equivalent of 14 weeks of leisure. now, nobody i think would want to claim that these great increase in leisure fully compensate for the differences in income. but it's also true that big increase in leisure are not nothing. we don't live by bread alone. our happiness comes not just from our income, it also comes from our free time at a time where to spend with a friend, a time where to stay with her hobbies, the time we have to spend with our favorite tv shows.

so i think it's worth keeping in mind that over the last 40 years, if you're bored but inequality might want to keep in mind that the big relative the winners in the income derby have been the winners in the leisure or become and vice verse. those people have gained a lease income have gained the most leisure. one might also point out that the quality of the leisure has been improving. 50 years ago the rich men and the poor man spent their leisure time and very different ways. nowadays, the rich man and the poor men are pretty much surfing the same internet and watching the same 500 cable channels. so there's been a great equalization there as well. when we turn to asia and africa, they are, the poor there are considerably worse off than the

poor in the united states, but we are seeing in many places the same patterns that we thought in the west, in fact 100 years or so ago. take child labor for example. in asia in many parts of africa, incomes are about the same as they were in the united states in the year 1840. and people send their kids to school, to work, people send their kids to work at just about the same rate that americans did in the year 1840. moreover, we know historically the pattern in the west, in the united states and in england about people pulled their kids out of the workforce as their incomes rose a certain threshold level. >> we're seeing the same patterns in africa and asia. people are going to get out of the workforce as they go over the same threshold income levels. now, you might have heard that child labor in the third world

is caused by big multinational corporations throwing their influence around in convincing people to send the kids to work against their own interest. if that's your theory, then you've got to explain why americans and englishmen were sending their kids to work in 1840 at pretty much exactly the same rate at a time when the window of the national corporations around to influence. poverty is a terrible thing. poverty, it means facing terrible choices, like should i send my kid to work or should i send my kid to bed hungry? for people in various cultures at various times have faced those questions, and have pretty much all settled them in the same ways. certain levels of income you send them to work. at higher levels of income you take them out. it is i think the height of arrogance for those of us have gotten past that stage to look at other people who are now facing that and saying, you ought to do it very differently than we did.

but a lot of americans take that view. this is a 10 year old bangladeshi girl, or she was 10 years old when this picture was taken in 1992. she lost her job as result of protectionist legislation that was sponsored by senator tom harkin that closed down, ended up closing down factories in bangladesh that were not up to the standards that america lawmakers thought they ought to be up to, about 50,000 children lost their jobs as result of that. she was interviewed by an anti-poverty activist in bangladesh at that time, this was her take on the situation. they loathe us, don't they. we are poor educated. that's why they shot the factories down. >> there is one difference though between us in 1840 and the third world today.

the difference is that when we were poor there was nobody who was rich but there was no way we would turn to for help. the poorest people today are turning to the relatively rich and asking for help. and that raises a question of what ought we do about that. that's a hard question with a live aspect, and i'm certainly not going to settle it for you today. i do want to say a few things that you might want to keep in mind what you think about that kind of question. first of all, it is remarkable to me, the extent to which arguments for income redistribution either across the world or with any country our literary arguments. that's not a criticism, but they tend to be arguments based on literary analogies, metaphors. i like arguments and metaphors. the arguments for redistributing income are very heavily

metaphoric way to pick they say things like we are to redistribute income because society is like a family. we are to redistribute income because society is like an insurance. like i said i like metaphors but i also like taking them safely, so let's look at those metaphors and see where they really lead us. let's start with the family metaphor. here's how this metaphor goes. society is like the family, and we should redistribute income within the family because families do not allow one member to struggle while another prosperous. that's almost a direct quote from the governor in new york. families do not allow one member to struggle while another prosperous. the problem with that metaphor is that families do allow one member to struggle while another

prosperous. they do it all the time. we know that from data. we know it from data on because. in families with our great income disparities among the children, more often than not the parents divide the bequest equally. a bequest is your final opportunity to redistribute income among the people you love the best. and most people look at that opportunity and say, i don't want to do that. i don't want to redistribute among those people. so if your role is to make society more like a family to reflect the values that we observe in family, well then, you're metaphor tells you we should have less income with distribution, not more. a better metaphor, in my opinion, is the entrance metaphor. society is like a big insurance contract, and the store the people want to kill here is that look, before we were born, any

one of those could have been born into any circumstances at all. what could've been born smart. we could have been born stupid. we could've been born ambitious or lazy. we could've been born with great opportunities or with no opportunities. and if we have had the opportunity prior to being born, we would have entered into an insurance contract that said those of us who get lucky will take care of those who don't get lucky. and the argument is made that we didn't actually enter into the insurance contract because somehow before you're born even the insurance couldn't get out to reach you, but we all know we would have signed that contract if we could have and, therefore, we are morally bound by it. that is my reading of the argument that is offered we all know what would have signed that contract if we could have, and, therefore, we are morally bound

by. it. that kind of argument was the basis for john rawls monumental book on the series adjusted for john rawls was a philosopher at harvard university. he wrote this extremely influential book called a theory of just. i do not understand large parts of it. on those occasions in the past, rawls is dead now, but back when he was alive, whenever i quoted him in print i would always get a handwritten note from transport reminded me that i did not understand it. [laughter] he was right about that. but my best reading is this insurance metaphor, and i think most people treat is this insurance metaphor is a big part of what underlies his work. well, brawls was a philosopher. i'm an economist. and since i'm economist, not a

philosopher, i would like to think about this metaphor a little more deeply. i would like to take that metaphor seriously, give it its due and see where it leads us. the problem with an insurance contract, with enforcing an insurance contract that nobody ever signs is that you got to figure out what the terms of the contract were. exactly how much in years would we have ought before we were born. now, we can't look at documents to find answer to that, but we can make estimates, which is the kind of thing that rawls and his followers seem to never do. the first thing it is you ask how much risk where we after facing back there when god was handing out brains. you can estimate the risk by looking at the range of abilities that actual living people have, okay? we know how smart is poorest

people are. we know how dumb the dumbest people are. we not many opportunities the luckiest epic we know how many opportunities the least fortunate have. we know the variants of outcomes, and that's a mesh of how much risk people were facing before they were born. in terms of what circumstances they were going to be born into. once you measure that you can ask well, when people face commensurate levels of risk in other areas, when you look at the base build of a fire or a burglary or a heart attack, when they face commensurate levels of risk, risk with similar levels of various of how much insurance to the actually buy? and from that you can backup how much people would have paid to avoid that risk at birth time. so you can do a quick calculation of all that, and ask your self, what with the terms

of the insurance contract have been? in particular, how many people would we have agreed what fraction of the population would we have agreed to? what fraction of published would we agree to say, you're not in a very much in what, you might as well stay home and we will take care of you. do that on the back of the envelope. my former colleague, did that on the back of his envelope and then i did on the back of my family got the same answer so i have a little faith in it. the percentage of population that should be permanently unemployed and on welfare if we buy the insurance metaphor, 23%. bigger than any social insurance program that anybody has ever remotely contemplated in this country. 23% of the population should be on welfare permanently and never asked to work. that's pretty amazing. on the other hand, i said this was a dirty back at the envelope

calculation, and one think it left out was that it left out the fact that in a world like that there would be tremendous disincentive effect. what -- the rule in this world would be if you're among the dumbest 23% you don't have to work. the effect of that which are calculation did not account for is that everybody is going to play dumb, right, to try to be among that 23%. so if you redo that calculation, making the sort of worst-case possible assumptions how they will play out, then you get a different answer. point to 3% of the population should be unemployed and on welfare. a much smaller social welfare program and anybody has for a very long time ever contemplate in this country. so there are your bounds but if you ignore the disincentive effect completely, 23%, if you assume that there are as bad as

they can possibly be, .3%. where in there lies the truth, i do not know the answer to that. and i ran out of envelopes. i ran out of backs of envelopes. i don't want to suggest that either of these numbers should be taken seriously. but i do want to suggest this. if anybody is arguing for redistribution based on an insurance metaphor, they damn well better be doing this kind of calculation and they better be able to show you their number and how they got their numbers, and what assumptions they made. this is the kind of thing that goes into translating a metaphor like that into an actual policy proposal. that's all the way you would want to go if you took the insurance metaphor seriously in the first place. but there are problems with that. one of the big problems with the

insurance metaphor, at least as it is actually used, is that the social insurance program that we have in this country does not actually ensure you against any, against any of the really bad thing that could happen to you at birth. things like being born in cuba or albania, as opposed to canada over luxembourg, or the united arab emirates. remember, this is an old slide. this is what we learned about what poverty is like in america today. our insurance metaphor tells us that we're supposed to be ensuring people against the really bad things that could happen to you when you are born. being born into that, that's not so bad by world standards. so if you took the insurance metaphor seriously, and i think

it is not entirely unreasonable to do that, but if you took it seriously your conclusion would have to be that every single penny that we make in welfare payments should be going out to youth in los angeles but -- another disconcerting thing about this insurance metaphor, disconcerting, i'll pull up another old slide. i remind you that my conservative extrapolation, our ancestors are going to be making a million dollars per day. it is striking to me than that we have all these conservationists running around arguing that people like you and i living the lives we lead to be scaling scaling back our lifestyles, living more conservatively in order to improve the quality of life for these future brazilian theirs. that is a sentiment.

the sentiment of these people is that there should be a tremendous amount of redistribution from the relatively poor, mainly us, to the relatively rich, dammit our fabulously wealthy distance. that's what they want us to do. and often these are the same people who are always are doing that we need to redistribute more from the rich to the poor. now, i have not pointed to a flaw in either argument separately, but it does seem to me these argument are so much incompetence or the same person making both of them you've got to wonder whether he really thought things through. those are all philosophical observations about the issue of income redistribution. but i want to put the philosophy aside and talk about the main practical issue with income region should be shared is the main practical issue.

that trick never works. it never works. nowhere in history, nowhere in the world, nowhere in the world at no time in history as any program of income redistribution, as far as i'm aware, lifted substantial numbers of people out of poverty. occasionally you can somewhat alleviate the ravages of poverty for small dogs of people for short amounts of time, but i'm not aware of any case where substantial numbers of people have ever been lifted out of poverty through income redistribution. only source we know that has ever done that is economic growth. so if you want to solve the problem of poverty, what you've got to do is ask yourself where's all this growth coming from, and what do we do to nurture it? here's a start. these numbers are at least 10 years old, if i grab them today

the overall picture would look the same although some individual countries may have moved around. this is income per worker. that's capital per worker. capital per worker means the valley of the machinery that workers have to work with, the sewing machines, that seems uses are working on, the assembly lines the auto workers are working on. the value of the capital, the machinery, the physical plant that the workers have to work with. and what you see there is a very, very clear picture, economic theory predicts this, the numbers confirm it. the more capital workers have to work with, the more they earn. you look at that and you say oh, okay, that solves the products all we need is more capital. well, it's a little trickier than it sounds. where does capital come from? in order to produce capital we have to be not producing some consumer goods.

the guy who's building the assembly plant is not simultaneously building an ipod for you. the people who are constructing the capital and the resources that go into constructing the capital have got to be diverted. to say that people consume less is to say they are saving more. and to get more capital we've got to get people to save more. unfortunately, just saving more is not enough and here's why. the more we save the more capital we built. the more capital we have, the more effort, the more resources we have to put into maintaining it capital needs maintenance. the more capital we build, the more we put into maintaining it, and so a society that just relies on saving and investment for its growth is going to find that thinks peter out of cuba more capital, you move up this

ladder a little bit but then you're putting so much effort into maintaining that extra capital that it's very hard to move up things for the. that's why you can't jump to climb the ladder. you need something else to push you up that ladder. you need something else to push up that ladder. and it's crystal clear what that once something else is, the engine of growth is innovation. i recently had a historian tony that the reason the industrial revolution happened when it did can be traced back to a single cultural phenomenon that the idea spread that no matter what you were doing all week, it was always worth taking a couple hours every now and then to ask yourself how to do it better. the idea that you should put a little effort into figure out how to improve the way you do things was, at least according to this historian, the key driving factor behind the

industrial revolution. innovation is the only thing we know that can drive growth. yes, you need savings, but savings alone, three children and evidence tells you, cannot do the trick. we need innovation. what is innovation? when i said innovation people always think of is one of the electronic device to a look at the iphone their caring and a pocket, there's innovation for you. but it means more than that. it also means the farmer who invents a new method of crop rotation, or the business person who invents a system like, say, just in time inventory mission. and i did it has done more to alleviate the difficulties of poverty in this country and any idea i know of that is ever come from the united states congress. you can fly to tokyo partly because somebody figured out how to build an airplane, but also partly because somebody else figured out how to ensure it. you need both kinds of

innovation to get a computer computer on your desk, partly because somebody said hey, i wonder if we could make computers, i wonder if we can make computer chips out of silicon. but also partly because somebody else said hey, i wonder if we can find startup companies with junk bonds. take we either of those at the computer revolution goes away. and effect if you want to know which of those is more important, one good rough and ready way to answer that is to follow where the money went. go back to the early days of the computer revolution in the early 1980s, microsoft annual profits were about 600 million a year. does also the annual income of michael milken, a junk bond king. so by that measure the contributions there were about equal. innovation drives growth but that raises the question of what drives innovation. two things. that we know of.

one is education. the other is economic freedom. let me tell you a couple words about education. here the great expert that i was go to for information on this is eric hanushek at stanford university who has done all the research on the relationship between education and economic growth. he estimates that if you could improve mexican schools to u.s. call you could add years to the grocery. that's phenomenal. that's 2%, think about what 2.3 prison has done for the united states. this talk about adding 2% of what they've already got to improve u.s. schools today and is called, again that is three quarters of a percent to the grocery. that is gigantic. i want to take a minute to say something about how you know that, how we figured that out. you can of course look at different countries and noticed the ones with good education have higher growth rates.

that doesn't prove anything. because we all know that correlation does not prove causation. you've got to do something a little trickier. once again i'm pulling up numbers that are for illustration only. these numbers are 20 years old and will have changed by now, but here's what these numbers mean. occasion, first i was a wrong and then i will say it right so you can see what the difference is. for a haitian, an extra year of education adds 2.0% to your innovation. for a mexican, an extra year of education adds to .0% to your which purported ecuadorian, and actually of education as 2.77% to wages because a measure of the quality of education in those areas of the country how much of that is wages and a much is practical skills. that's still the wrong way to do it because the trend is working in haiti. the ecuadorian is working in ecuador. japanese is working in japan.

so may things are different in those labor markets. we'd like to control for that. so the right way to do this and what these numbers really mean, these are all measures of people who have immigrated to the united states and to working in u.s. labor market. they are all working in the same labor market which controls for all of those differences. a jamaican working in the u.s. labor market with an extra year of jamaican education earned an extra 3.5% in wages but if you're working in u.s. labor market and have an extra year of japanese education, you have an extra 8.22% of wage. and measuring quality of education in that way and then correlating it with economic growth is how hanushek gets a lot of these members. how do we do better, how do we improve our education? to me the answer, the obvious first answer is get the government out of it. but short of being able to do that, either you look at

evidence on what has actually worked in various experience and school districts around the country, some things like reducing class size our remarkably ineffective. other things like -- are remarkably effective come and the really big one is firing back teachers. hanushek estimates that if you got rid of the bottom five to 6% of cheese, that doesn't mean that every year you call a bottom five to 10 pacific a means once and what's going to take up a bottom five to 10%, replace them with average teachers and just do that once. then within 10 years you will have added 3.4% against its grocery. again, that is gigantic. that's gigantic. but coming back to my earlier slide on what drives innovation, i said education and economic freedom. talk about education let's talk about economic freedom.

what is economic freedom mean? it means small government. property rights, sound money, free trade, limited regulation, freedom to fail. freedom to fail means being able to start a business that other people think are crazy, and knowing that you're not going to be bailed out at the end of it does fail. because of people are offering to pay out if it does fail, then they will tell you how to run your business. if you don't have the freedom to fail, you don't have the freedom to succeed. if everybody who failed its bailed out, then the people who succeed are paying those bills. and it becomes no different, or it's worth the difference between the failures. you need a freedom to do something other people think is crazy, and to fail if necessary.

low marginal tax rates is another aspect of small government. and in particular, low capital taxes. let me say a few words about that because this is a subject i've got a real be in my bonnet about. all tax of course we all understand some taxes are necessary to run a policy. we also all understand that all taxes have disincentive effect, and that's bad. and we also i hope understand that some taxes have worse disincentives than others. a tax on wages discourages work. that's bad. a tax on capital income also discourages work, because part of the reason people work is to accumulate savings that they can invest. but that tax on capital income in addition to discouraging work also discourages savings. that's a double whammy.

a tax on wages discourages work. a tax on capital income by which i mean interest dividends, corporate income, some extent capital gains, estate taxes. this discourages both work and savings, which is doubly bad. that insight pervades the public finance literature the last 25 years. often called -- after the two economist at one at stanford and one at harvard. and one thing that i find that the general public is remarkably unaware of today is that there is something like a consensus among economists that capital tax rate in the long run off to be zero. that capital taxes do so much more harm and wage taxes that you always improve the world, even for the poorest when you

can replace the capital tax to the wage tax. of course, we want all taxes to be low but if you have a choice, capital taxes are most always the worst. there is a great deal of disagreement among economists about what the transition should look like. how quickly she we go to that 0% capital tax, should be the immediate? or should we go slowly? there's also another big issue. the reason you want to set that capital tax rate to zero is so that people will invest more. but they won't invest more unless they believe you're going to keep it at zero. there are a substantial number of economists who say that you will never get people to believe that you're going to keep it at zero c. might as well not try. there are a substantial number of economists who say that, and it's not an unreasonable argument. they said no matter what you commit yourself to do people will know that 10 years down the line you might change her mind, and because of that they will

have that disincentive effect anyway so there's no point in lowering those tax. those people have an argument. other economists are not convinced by that argument and say that we would get very far by lowering those taxes to zero and figure out how to commit ourselves to. but where the consensus lies, something very close, we're pretty much all agree is that if we could get to that 0% rate and commit ourselves to it, if there were a way to commit ourselves to a, that would be a good thing. the world would be better. the rich would be richer and the poor would be richer and not just the long term but the medium term if we could eliminate those capital taxes and convince people that we needed. ..

that chart of, of course, proves once again causization and correlation are two different things. so that's still only the beginning of the investigation. you have to start looking at data more carefully, controlling for all sorts of variables and you end up discovering that economic freedom is really, really important. in fact more so than it appears even in the graph. ideal way to determine something like that is with controlled experiment. that's always the gold standard in scientist. we have exactly two controlled

experiments. one called korea and one called germany. you split the country in half one goes one way and the other goes one way. you see what happens to the economic growth and in both cases the results were extremely definitive. the problem with the experiments that n equals two we only have two observations. it's never as experimenting with more. two is what we got. an economist at m.i.t. and harvard had a clever idea to how find other sort of controlled experiments. he said let's look at the countries that were colonies of england, for example. the english set up very different political and economic regimes in different countries. let's see whether the ones that had more economic freedom

prospered more. well, that's not really a controlled experiment because you put somebody db you can argue maybe the british chosen the prosperous places to give the freedom to. but his idea was this, he said that's not what happened. if you look historically, what they did was they looked around at where are the places that have a lot of bad diseases like malaria and yellow fever. they did not affect the natives. they immune but they affected the cool lom nist. the british said the places that have malaria and yellow fever. we're not going settle there. we really don't care how bad things are there. let's give the regimes and the -- and the nonfree regime. the places that are free of malaria and yellow fever those are the places we might want to

settle some day. so let's make things there as free and democratic as the sort of place we might want to live. that's kind of like a controlled experiment. because it's kind of random which are subject to malaria and which are subject to quell low fever. that's a random assignment. the british making some places freer than others. if you look at that and ask me about specific countries, i don't have the country by country data at hand. i should have put it up here. if you look over all what he finds in that pseudo controlled experiment you find considerable evidence that freedom causes prosperity. freedom causes prosperity economic freedom prosperities, what about other kinds of freedom? other kinds of freedom doesn't seem to matter much. if you look at political freedom, and these are things

that ink most of us would agree are good free and fair elections, the right to organization, the no come nantd military or religion. open transparent government, right was minority. none of that was prosperity. civil liberties. freedom of compression, freedom of association, gender-equality. none of that colates much with prosperity. again, it doesn't mean it's bad things. they're not the things that cause prosperity. freedom house is an organization that brings countries on political freedom. there's political freedom and in this case it's not like the other graph. the other graph ten was high. one is high on this graph. so one the freest countries. and you can see that it is true that there is some correlation there, the freest countries are on average a bit richer than less free countries. it doesn't continue as you go down, you know, these sixes are richer than the fives and the

fours, and you look deeper into the data there's no serious correlation there. what matters for prosperity is the economic freedom. not the religious freedom not the political freedom, not the civil liberties. so i'll amaze again, the cause of growth is education and economic freedom. i'll point two of these interact. education, causes people who are educated to save more, people who are educated innovate more, the data show that if you improve education at the higher level, you get more innovation. if you improve education at the lower level, innovation tends to get adopted more quickly. so education at higher and lower level improve education. freedom leads to more innovation people have the rights to their discovery, it leads to for savings because people will save more when they believe their savings are not going to be con

if confiscated and savings in innovation are the big inputs to economic growth. soily stop there. i went a longer than i planned to. and i'll take your questions. [applause] going wack to the first part of your presentation. you paint with your perspective, you paint a very optimistic long-term view for the world. and i'm kind of wondering for you can i know there is a kind of big subject in itself. can you say, say, the european debt crisis situation, put that into perspective and say are you optimistic about europe? about japan. places that seem to have very intrablghtble economic problems? >> these places -- as you say, seem to have tractable economic

problems. all of them have positive growth. it is a mistake, i think, to look at the balance sheet of the government and draw a conclusion just from that about the economic health of the country. the government's balance sheet, effects all of us. each one of us on average owes something like that $50,000 worth -- each of us owns $50,000 of federal debt obligations. but -- and that in the long run, is certainly affecting our individual well being. but it's also true that we're all richer than we were fifteen years ago, and that we're getting richer. could things take a worse turn? our government is capable of

completing screwing things up? absolutely we have seen it in africa. many countries took off and started to follow off the same path that they followed in the west and most of the rest of the wormtd. you can seen incredibly corporate governments bring the growth crashing down and even turn it into negative growth with retrogression. so yeah, there is no limit to the ability of damage governments can do. there is also fortunately no limit to the amount of good free people can do. and we are very -- people talk about -- tom said last night that we're broke. we're not broke. if we were broke we couldn't afford to be here in the room. the government has spent lot of money, much of which i think they shouldn't have spent. we are poorer for that about. we are about as much poorer for that now as we would have been as they paid for it as they went

along. they're promptses to take it from the future. they could have taken it in the past. it costs about the same either way. yeah, they can do a lot of damage. there's an awful lot of wealth for them to play with. i wish they would do less damage. but i i do not see at least in the west, governments actual brings this whole crashing down to nothing. >> yeah. >> thank you. >> i'm wondering, about the claim of education causing growth or maybe it's the other way around growth using education. if you look at curves for the u.s. of how gdp rose, and how college education rose. both are those kinds of exponential curves but seems like gdp rose first and people didn't start going to college until the early 1900s rather

gdp took off in time of edson and ford in the late 1800s. >> this things interact in all sorts of ways over the year. i mean, another -- as early as 200 years ago you saw people -- you saw increases in the amount of education people were getting just as a response to the fact that technology was growing and that in order to use that technology, you needed some education. so individual choices to become educated definitely started -- you see it in data as much as 200 years ago. more recently much of the evidence on education and growth is international evidence. the u.s. numbers that you're quoting, i don't have in front of me. i wish i did. but there is a lot of international evidences that education precedes growth, and again, i wish i had a slide to up.

the place i would point to you next time you're in front of a computer a google screen is the work of eric who has done the careful work on this. >> yeah. >> well, do you agree with your conclusion that economic freedom is con conducive to growth? but i would question whether some of the -- you pointed out what the various english colonies was random because if someone -- if a country was more acceptable to malaria or yellow fever or whatnot. it might be indicative of perhaps other problems that would hamper growth. >> the reason that want to rule that out is the natives were largely immune to that play leer ya and yellow fever. for the people working the malaria and yellow fever were not a problem. and so the fact that think had not bother to eradicated those

things is not indicative of anything other than the fact they weren't a problem. >> given that if congress takes no action, the increase in the tax on capital gains is going to be 66% on january 1st of 2013. and that the increase and the tax on dividends is going to triple from 15 to 45%. you do you have any forecast for for us about what you think the impact will be on america if there are no changes by congress? >> i think these things are disasterrous. i think they are disci'sous. if you want me to make precise numerical predicts. i'm not going to do that. but -- these will be disastrous things. as i said, there is something like a con consensus among economists that all capital

income should be taxed at the rate of zero. originally, in the 1980, when the idea became current, the research that we had then showed only that that would improve prosperity for the average american. more recent research has shown that prosperity and has shown very robustly under a great variety of assumption the prosperity would pervade every income class. again, it doesn't work if people don't believe you're going keep the rates low, and this kind of thing is exactly why people don't believe you're going to keep the rates low. whatever they are now, people are not responding to the current rates. they are responding to what they think the rates will be next year, and but if you -- look if you pulled economists, this is one of the things -- there's a lot of thick we disagree on this. there is stuff we pretty much

all agree there's too much occupational leanture. we all agree that free trade is almost always and everywhere a good thing. and we all agree that if you can commit yourself to lower capital rates, you ought to do that. and it's a big deal if you don't. >> well, i wouldn't want to pin you down on an exact percentage. the 2.3% growth we've had since 1960, or '65 do you predict we will have growth in 2013 if the tax increases? >> the answer depends so much on not what the tax rate are on 2013 but what they expect them to be in 2014, 2015, and 2006. i can't begin to touch that. i don't know how the expectations are going to evolve . >> do you implied the answer to this. i'd like to see if you have

anything more to add. any time you have redistribution whether from americans let's say to americans. the effect on of, like, killing the goose lays the golden egg and any capital that might have been exported from america to other countries. what do you say say about the effect if the welfare were to help the poor. how much would it less if you help them if you let people keep their money. >> and that was what i tried to address with the numbers i put up there. if you make the worst possible case scenario assumptions about that. you still end up discoverying if you take the insurance metaphor seriously and if you take your issue seriously, and if you make the absolute most worst-case scenario for the goose killing '02 going do, you should still have, according to the method for, a small social welfare net. much smaller than we have now.

which affects.3% of the population. it you make more realistic expectations you would end up arguing for a bigger social safety net. again, what i want to do is not make the case for any particular number, but to make the case that anybody who is arguing on those grounds for social safety net has got the obligation to tell you exactly what assumptions they made. what the calculations were, what number they came up and how they defend that number. yeah? >> my name is -- [inaudible] i'm serving in the swedish parliament. i have one question or clarification. you say there's no significance or correlation between on the one hand, civil libbist and economic growth. so is there saying there's no correlation between civil

libberrist and political freedom on the one hand and on the other hand economic freedom in the sense that -- [inaudible] one will promote the other? >> good question. let me try and remember what my numbers show. i think what you will find is that if you don't control for economic freedom, then very high levels of political freedom and civil liberties are correlated with prosperity. if you get away from the high levels, the difference between the moderately free and the not free at all, there you don't see any correlation at all. the interaction between the political terms and the economic terms is exactly the right question to be asking, and i'm -- i wish i could remember the

answer, for sure. i think i do. but i don't want to say anything i'm not sure of. i'm going to look it up and i'll tell you tomorrow. great question. yes? >> i want to ask you to clarify a little bit about your meeting that freedom causes prosperity. does it also reduce poverty? are they saying the same things if the top 10% have their prosperity increased, and the bottom 90% have their poverty increased too or less so -- let me say it this way. is there some fact i could rely to tell 90% of my friends that they're poverty is also being reduced by freedom? >> you are right. to say that the average incomes go up is the not the same thing to say the poverty is reduced. imperically those things go hand and hand.

if you look in the united states, again, i showed you what poverty looks like in the united states today, that improvement in the equality of life for the poor has moved along with the overall growth in the united states. in fact, if anything it has moved faster. if you look at this in china, you know, a billion people have lifted out of poverty through the powr of growth. i don't know offhand of any example, any substantial example, ongoing example, where society has had seened growth and where it has not brought the lower end up along with it. certainly the big examples in the west and in asia you see the things going hand and hand. >> i wondered if you had any comments about tyler cohen's lo-hanging fruit metaphors on growth and the possibilities for

growth in the future. >> yeah. i have a comment on that. [laughter] hangs on. i can figure out how to use this. there's any -- my comment. [laughter] yeah? >> you had some very positive statistics and living standards for the u.s. poor, but one could possibly argue that that's not just the effect of economic growth, it's also the testament to the success of the redistribution welfare states. my question is, is there a way you can filter out i know it can be imperically difficult to do it. have you thought about a way to filter it so it's a striker example of how rising tides lift

all boats? >> certainly if you -- i think a the best way i can think of to address is half maryland --off hand is the powerful correlation we seen everywhere between capital per worker on the one hand and income per worker. i had a graph where you saw almost a straight line, it was up here earlier. in industrial activity, approximately two-thirds of the revenue gets paid out to workers. and that's a -- that's a good imper call rule of thing. it's going to carry you through centuries and cultures. workers get about two-thirds of the output. that means that the more output there is, the more workers are going to get. you can do some redistribution around the edges. what affects the qualities of life for the poor, i think, is the wages.

and wages are tied to the amount of capital they have to work with. and again, you see that not just over time, but also across countries. yeah? >> the only comments that i've heard about population were really in the graphs because they were done on a per capita basis, i'm wondering for there are any excellents you can make on -- comments you can make on population in with regards to growth and perhaps longitude studies. >> i will spend half of wednesday talking about population. i don't want to giveaway my punchline. lftd. >> thank you. >> i want to ask you think that microlending to entrepreneurs around the world increases their economic freedom. >> this america are lending -- america lending stuff warms any heart. i love the idea of it. if makes me feel good. whether it works, i have no

idea. i haven't a clue. i hope it does because i think it's cool. >> i wanted to ask about two things that seem to me to have a great effect and that is the impact of corruption and if you will, property rights, but real rule of law. >> the affect of corporation you see most thatmatically in africa, again, countries have gotten started on that growth path. that growth path, that different part of the world started at different times and they have all kind of moved up the growth path. you see specially in africa where a corrupt government somes in and put the brakes on it completely and turn it around. there's no question crurption corruption is a huge brake on the growth. there's all kinds of argument about what why the industrial revolution came when it did. i think there's a good case to

be made that the advent of moving the force and greater respect for property of rights and for economic freedom came with that was the -- a necessary prereck sate for the industrial revolution. i'm not enough of historian to defend that, but i have finished reading the mccallly's history of england. it sounds right to me. yeah? >> you can't -- you just answered my question because i was wondered if you have given some thought why the industrial revolution happened when it did happen and why only in the west? >> look, everybody thinks about this stuff has asked why it happened when it ask. nobody has an answer to that. again, my historian friend told me recently it was the spread of the viral idea it's a good idea to think about things better. you ask yourself why did the

viral idea get started that the particular time. you could argue it happens randomly. it's not very satisfying but maybe it the right. there were political changes in i england starting in 1688, and those changes, as i understand them, speaking as a nonhistorian, did create a freer climate and a safer climate for investment, and i suspected it had quite a bit to do with it. that telling you we should care about the politics and our constitution and we should be particularly concerned to preserve those sorts of freedoms. >> joe. -- [inaudible] [applause] the commission on president issue combats has -- three

upcoming president issue debates this fall. the first on domestic policy will take police october 3 at the university of denver. the second obama-romney debate will be a town hall format in new york. and the final debate on foreign policy will take place october 22 at lynn university in florida. the vice president cial debate in certainly college in kentucky. all debates 90 minutes long. be sure to check c spain.org/campaign 2012 for our coverage plans. the u.s. senate remainsmains in recess as they attend the party caucus lunches. harry reed took to the floor. first amendment to be one repealing the health care law. their comments are about twentyl minutes.

president, i want to spend a f few minutes talking about the i i wonder how much people on the republican side today are going to talk about obamacare. if they do, they should be in a positive state. we know that as we saw this bill this affordable care act, people are getting and soon will get, - everyone will get a rebate one of the things did, led by senator franken and others, is that 80% of the money that is paid for premiums has to go to patient care. and if it isn't, then the amount that doesn't has to be refunded to the patients. that's in the process now. in the month of august, all those moneys will come back in significant amount to americans who, in effect, have programmed -- they're part of programs that spend too much time on salaries

for bosses. also, we're going to talk a little bit today about what this does, this affordable care act, for women in america today. as i said, i'm going to speak very briefly on this, but we're going to have people come today as soon as i finish and as soon as the republican leader finishes to talk about the good things in this bill for women. and i will just touch on them very briefly. there's no question that this bill, signed by president obama, is landmark. it is a landmark piece of legislation. it signaled an end to insurance company discrimination among many, but especially against those who are ill, against those are preexisting conditions, and especially, mr. president, against women. as a result of this bill we passed, being a woman is no longer a preexisting disability in eric in. for many, many years, djourns companies have charged american women higher premiums. why in because they're women.

and for years american women have unfairly borne the burden of high costs of contraception as well. even women with private insurance often wind up spending hundreds of dollars each year more for birth control. today women of reproductive age spend two-thirds more out of their own pockets for health care costs than men largely due to the high cost of birth control. but starting tomorrow, no contraception. how much, mr. president? no additional pay at a under health reform, about 47 million women will have additional access to those resources without cost-shank many on the other side have downplayed these benefits or fought to repeal them altogether. hard to comprehend but true. forcing american women to --

every year -- every year millions of women in the united states put off doctors' visits because they can't afford the co-pays. millions more skip pills or shots to save money. and it's no mystery why the united states is one of the highest rates of unintended pregnancies among industrialized nations. half of all pregnancies are unplanned. and of those unintended pregnancies, about half wind up in abortion. increasing access to contraception is the most effective way to reduce unintended pregnancies and to reduce the number of abortions. but the high cost is often a barrier. that's why in 1997 olympia snowe and i began a bipartisan effort to prevent unintended pregnancies by expanding access to contraception. it hasn't been an easy path. it wasn't then. but we did make a start.

as part of this effort, we helped pass a law ensuring federal employees access to contraception. it was a big, big issue. that was 15 years ago or more. it was an issue that was very important but a we started that. olympia snowe was terrific to work with. when this benefit took place in 1999, premiums did not go up a single dime because neither health care -- or did the health care costs, not a penny. it was reward knowing that a pro-life democrat and a pro-life republican were able to confront the issue with a practical eye rather than a political eye. it is unfortunate that over the last is a years an idea that started as a common-ground proposal as become so polarizing here in congress. the controversy is quite strange when you consider that almost 99% of women have relied on contraception at some point in

their lives and many have struggled to afford it. mr. president, 99%. the affordable care act will ensure insurance companies treat women fairly and treat birth control like any other preventive service. prior to senator snowe and i doing this, you know, mr. president, anything that a man wanted, they got. viagra, fine, we'll take care of that. anything a man wanted, they got. but not a woman. but the law doesn't just guarantee women's access to contraception. it ensures their access to many other lifesaving procedures as well. thanks to the health care bill, affordable care act, insurance companies have already required -- are already required to cover preventive care like mammograms. mr. president, a person that is

able to have a mammogram, it is lifesaving. most people in the senate know that my wife has battled breast cancer. she had a mammogram in december, and in august discovered a lump in her breast, and think what would have happened if she had waited a year because she couldn't afford that mammogram. frankly, the thought of it is very hard for me to comprehend because even though she had that mammogram in december, she found she was in stage 3 of breast cancer and it has been very difficult. but what if she had waited an extra year? many people wait a lot longer than an extra year. colonoscopies -- so -- i was talking to one of friends in

the senate. you know, these colonoscopies save lives. he's going to have his done in -- they do it every five years. it takes about ten years for the polyps to develop cancer. but they all develop cancer if you don't have them taken out. people need to have these done. blood pressure checks, child immunization without cost-shank that's part of what's in this bill. it used to be a bill. now it is a law. starting tomorrow -- again, wednesday of this week -- women will no longer have to reach in their pockets to pay for wel wellness checkups. they can do screening for diabetes, h.p.v. testing, diabetes screening, all in the

law today starting to. all women will have access to all forms of f.d.a.-approved contraception without having to shell out more money on top of their premiums. any insurance company discrimination will help millions more women afford the care they need when they need t it will restore basic fairness to the health care system. sometimes the practical thing to do is the right thing to do. that's what the legislation that we worked so hard to pass is all about. it's about doing the right thing for everyone. but today we're going to focus on women. the presiding officer: the republican leader. mr. mcconnell: i have listened carefully to the majority leader's speech about what most americans refer to as obamacare. i think given the fact that our friends on the other side are going to focus on that bill this particular week, it might be a good idea to have a vote on it on the pending bill.

it would be my intent to offer an amendment that i know my friend does not support, but nevertheless many americans would like to know here, since we have spent a good deal of time positionings over the last few months on various and sordid issues, i think it would be appropriate to have a vote on the repeal of mcobamacare. i think it would be good to offer that amendment during the pendency of the bill on cybersecurity bu which we beliee be opening to amendments. i wonder if my friend thinks that might be something both sides would agree would be a good idea? mr. reid: mr. president, i wonder if the court reporter can state the big smile on my face. show that. can you imagine how ridiculous my friend, the republican leader's statement is? listen to what he said. we're talking about cybersecurity. we talked about the dangers in cybersecurity if we don't do something about it.

and he's now telling me that he wants a vote to repeal all the stuff that i just talked about, on cybersecurity? mr. president, that is very difficult to comprehend. i think we should understand that i don't think a woman getting contraception has a thing to do with shutting down the power grids in america or the financial services in america or our water systems or our sewer systems. that's what cybersecurity is all about. not whether a woman can have contraception or whether she can have a wellness check to find out she's got cancer from not having had a mammogram. mr. durbin: would the majority leader yield for a question? mr. reid: i'd be happy to yield. mr. durbin: do i remember that the very first amendment on the transportation bill was offered by senator blunt of missouri on family planning? is there a family planning amendment available on every bill now that will be offered by the republican side? i know the house republicans

have had 33 votes to repeal obamacare. are we going to try to match them with similar efforts in the senate? mr. reid: my response to my friend is this. i try to be very calm about things in life generally, especially things here on the floor. but i can't remain very calm about this. mr. president, i have 16 grandchildren. they are evenly divided between boys and girls. i want my granddaughters to be treated so that if they want to go get some contra -- have some contraceptive device in school, new york university, berkeley -- i'm bragging about that they got in those schools -- they should have the ability to do that. i think as i -- i just can't imagine what we're talking about here on the senate floor.

cybersecurity, one of the most important -- it's the most important issue, i've already said, dealing with if you want to talk to general petraeus, he'll tell you what it is. you want to talk to general demsey, he'll tell you what the important issue is. the number-one issue today is whether we're going to have bad people attack our country and shut it down. now we're here being asked if we're going to have a vote on cybersecurity, as to whether my grandchildren can have contraception. the presiding officer: the republican leader. mr. mcconnell: mr. president, i guess the answer is no. my friends are going to spend a week lauding the advantages as they see it of an immensely unpopular bill that was passed a couple of years ago on a straight party-line vote: obamacare. yet in a week in which apparently they are going to laud the various provision of it, they're not willing to have a vote in support of it. so i gather that's a vote we will not have. i will request the opportunity to do that again; anticipate

listening to my good friend, the majority leader, such a request would likely be blocked. on another matter, mr. president, four years after the great recession -- mr. reid: if the senator would yield for a question? mr. mcconnell: i believe i have the floor. the presiding officer: the republican leader has the floor. mr. mcconnell: four years after the great recession began, millions of americans are still looking for work. millions more have dropped out of the workforce altogether and uncertainty about our nation's future continues to spread. the stories of disappointment and of loss haven't diminished. they have in fact multiplied. what's worse, a president who was elected on a pledge he'd turn all those things around is still pointing the finger at his predecessor. three and a half years after he took office, he's acting like he just showed up. look, mr. president, i think

most americans are smart enough to know that he's made things worse. he's hammered small businesses with a barrage of new regulations, with dozens more in the pipeline. he expects them to plan for the future without even knowing what their tax and health care liabilities will be. last week he even spearheaded a legislative effort to take even more of what nearly a million of these small businesses earn, and then he told republicans that if we don't go along with it, he'll raise taxes on everybody else. that was the message last week. either give me what i want, raise taxes on a million of our most successful small businesses, or we'll let everybody's taxes go up at the end of the week. in other words, he used small businesses as little more than a bargaining chip. the week before that he told business owners they're not really responsible for what they build. listen to that. business owners, the president

said, you're not really responsible for what you built. no amount of white house spin or manufactured outrage can change what the president said in roanoke, and no amount of finger pointing can change the fact that his policies have actually made things worse. but what's most upsetting to a lot of us is the fact that the administration pretends its policies would help the economy or create jobs when it knows that they won't. he knows these policies are not going to create any jobs. what's most upsetting is the deception that lies at the heart of so many of the sales jobs from health care to the stimulus. americans wanted the president to focus on jobs, and he focused on a health care bill that we not learn not only includes a tax on the middle class, but which will lead to hundreds, hundreds of thousands of fewer

jobs. now, the president claims he's fighting for the middle class. but three and a half years into his presidency, their wages are still stagnant. while their dependency on government assistance actually continues to rise. wages are stagnant, dependence on government assistance continues to rise. in some cases the president doesn't even bother with the sales jobs. he just keeps his plans a secret. that's what we're now seeing with the defense cuts he's demanded during last year's budget negotiations. literally for weeks republicans asked the president to tell the american people how he plans to carry out these cuts. he refused. mr. president, the senate is not in order. the presiding officer: the senate will be in order. the republican leader. mr. mcconnell: as i was saying, for weeks the president -- republicans asked the president to tell the american people how he phrapbgs to carry out -- how he plans to

carry out these cuts. he simply refused to do so. so last week congress passed legislation requiring him to do so. in fact, it cleared the senate, i believe, unanimously. then yesterday there was this, an assistant secretary down at the department of labor is now telling people they're under no legal obligation to let on the cybersecurity bill this afternoon. this is live coverage here on c-span2. a member of the united states marine corps, that you no long -- though you no longer wear the uniform, i believe once a marine, always a marine, and your service in vietnam and to the nation as secretary of navy is just well known and well appreciated. you know, mr. president, you've served as a marine corps -- in the marine corps and as secretary of the nevada

and now a -- navy, and now you're in the senate as a member of the democratic party. you really served the nation. i come to the floor today to talk about cybersecurity and the need to pass cybersecurity legislation this week in this body. and, mr. president, i come to the floor not as a democrat. i come to the floor as a patriot. i say to my colleagues and the united states senate, this week on this floor, the united states senate has a rendezvous with des ni. -- destiny. we have pending before us cybersecurity legislation, a framework to protect critical infrastructure, the dot com world against cyber attacks from those who have predatory, hostile intent to the united states of america. now, we are bogged down. we are not moving.

we're once again following what has become a usual pattern in the senate that when all is said and done, more is going to get said than gets done. but, mr. president, i say to you and to anyone listening and anyone watching, we cannot let that happen. the united states of america is in danger. and this danger is not something in the future. it is not something written in science fiction books. this is not the wave that's going to come. it's happening right now. in cyber attacks on our banking services, our personal identity, our trade secrets, things that i'll talk about more. now, the naysayers here say we can't pass this bill because it will be overregulation and it will lead to strangulation and, oh, my gosh, we can't ask the private sector to spend one dime

on protecting itself. well, let me say to my friends, because i respect healthy criticism, but i want them to know that if anything happens to the united states of america, if the grid goes down, if nasdaq goes down, if our banking system goes down, when we will not be able to function because the street lights won't be on, that we won't be able to turn the electricity on, i will tell you what will happen. once again, politicians will overreact, we will overregulate and we will overspend. now, in a very judicious, well thought for, well-discussed process we could come up with a legislative framework that would defend the united states of america and at the same time balance that sensible center that another great patriot, colin powell, calls us to do.

always look for the middle ground while we look at where we want to go. now, there is this cyber war and i want everybody to know about it. the cyber attacks are happening right now. cyber terrorists are thinking every single day about attacking our critical infrastructure. there are nation states that want to humiliate and intimidate the united states of america, to cause catastrophic economic disruption. how do they want to do it? they want to take over our power grids. they want to steal -- they want to disrupt our air traffic control. they want to disrupt the financial functionings of the united states of america. cyber spies are working at breakneck speed to steal many of our state secrets. cyber criminals are hacking our networks. cyber attacks -- what are we

talking about on this bill? we are talking about critical infrastructure. now, mr. president, i'm a senator from maryland. you're a senator from virginia. remember that freaky storm a couple of weeks ago? remember pepco, oh, boy, i've still got my ears ringing from my constituents calling about pepco. i can tell you what it was like in baltimore when that freaky storm hit. you couldn't get around. the stop lights were down. it was like the wild west getting around. you could go into stores if they were open and nothing functioned. the lights weren't on, the the refrigeration was off, business was losing hundreds of thousands if not millions of dollars. families -- feanls, like a mother with an infant child and another child with no electricity for five days,

going to a hotel room. now, you want to talk about this bill costs too much money? just look at what it cost the national capital region of the united states of america because of a freaky storm. now, it took us five days to get the utilities back on because of the utility company. but what happens if our destiny is outside of our control, that the cyber terrorists have turned off the lights in america and we can't turn them back on? it's going to cost too much? hey, wait till this kind of thing happens. i don't want it to happen. and-week prevent it -- we can prevent it from happening and do it in a way that understands the needs of business. i want to understand the needs of business but i sure understand the needs of families.

i need to understand the effects of small business. for those who say it's going to cost too much and they have the concerns of the chamber of commerce, fine, i don't want to trash talk them but my father owned a little neighborhood grocery store. i know what it's like when electricity went down. my father lost thousands of dollars because the frozen food melted. cost thousands of dollars when we had a freaky storm was the refrigeration in his meats and products went bad. my father lost thousands of dollars years ago in a freaky, freaky storm. mr. president, this bill means that if we come up with the kind of legislation we want, we can deal with it. just remember what drilling information means. it means the financial services, it means the grid. so when there is no power, schools are shut down, businesses shut down, public transit is crippled, no traffic

lights are working. and, by the way, over there in virginia, didn't the 9/11 stop working and -- 911 stop working and they're still investigating? don't we love to investigate? well, right now i don't want to investigate and i don't want to castigate but i sure want the senate to be able to get going. then there is the issue of financial services. the f.b.i. is currently investigating 400 reported cases of corporate account attacks where cyber criminals have made unauthorized transfers from the bank accounts to -- of united states business. the f.b.i. tells me they're looking at the attempt to steal $255 million, an actual loss of $85 million. hackers have already, going into the new york stock exchange, they've already going into nasdaq and the attempt to shut down or steal information.

gosh, if we allow this to continue, it could attack and cost us a million dollars -- billions and billions of dollars. mr. president, do you remember in 2010 we had a flash crash? nouveau voe cab brear p. the dow plunged because automatic computer traders shut down. this was the result of turbulent trading but just imagine if terrorists or nation states that really don't like us, and i'm really not going to name them, but we really know who they are, really create it. i know there are patriots in this senate who have really been the defenders of the nation in other wars. they have said themselves that they worry about the asian

pacific. they worry about china. you know, i worry about china, too. so while we're looking at the defense authorization and appropriation and people want a blue -- more aircraft carriers to defend us in the blue water against china, what happens if there's a cyber attack? now, we do know how to protect dot mil but do we want to protect also dot com in the same way? i think so. i want to salute senators lieberman and collins. they've come forth with the bill that does two things from a national security perspective. first of all, it tells business you voluntarily can come in. there is no mandate to participate. but if you do come in, if you do come in, you will get liability protection. wow. in other words, we're actually

going to offer incentives. we're actually going to offer good-guy bonuses. we're not going to do it through tax breaks or more things to add to the deficit or debt. we're going to say come on in, participate in both the setting the standards, we want you at the table and then living by the standards. and for that, you will get liability protection. now, there is also those who say we just don't like department of homeland security being in charge. we worry about a cyber katrina. you know what? i worried about that, too. but i must say in all of our meetings we can see that the department of homeland security has made tremendous advances. i've been one of their sharpest critics in this area and i've been skeptical from the beginning, but now as we've moved along and listening to secretary napolitano and general alexander, the head of the national security agency, on

how they can work together honoring the constitution and civil liberties, i think we have a good bill. why do we need this bill? general alexander, who heads up the national security agency and the cyber command, says that we are facing attacks and potential of attacks that are mind bloing. he talks about -- mind-boggling. he talks about the stealing of trade secrets that amounts to the greatest -- the greatest transfer of wealth the country has ever seen. he worries about the security of the grid. he worries about financial services while he also worries very much about the dot com. but, mr. president, you know, we live in the united states of america. we have constitutional government. our military, no matter how powerful and how strong, has a responsibility to do certain areas, but we need a civilian agency in charge of how to

protect dot com. a civilian agency benefiting from the incredible turbo intellectual power of the national security agency. so we've got a bill that offers the framework. i would also say let's have a bill, let's vote for cloture, let's have a regular order with actually germane amendments. we have patriots here, but we need to act like who are we for. are we for protecting america? or are we for coming up with the same old platitudes that resist any activity of government at all to protect the american people. mr. president, i'm no janney-come-lately to this bill. i represent one of the greatest states in america. i'm the state that's the home to the national security agency. i have the high honor of being

on the intelligence committee. i've been working on this topic for more than -- more -- almost up to a decade. and i've watched the threat grow as i watched the technology against us grow in power, and watching the number of people that could attack us in this area. i sit on the appropriations committee, where as a member of the d.o.d. appropriations i've been proud to work with both the authorizers and senator inouye to stand up to cyber command, the tenth fleet which is the cyber fleet, and others related to it. but also what i've been proud of is to be able to take a look at what we do need to do here in terms of everything from work force to protecting others. mr. president, i fund the f.b.i., and working with director mueller i've been able to see up close and personal the growing threats right here in

the united states of america. whether it's the cyber criminals that can literally invade large banking, i could give example after example. working also with other departments, we can see that they're in cyber -- cyber attack. we need to be able to do this. so, mr. president, i could give other examples, and i will do so in the debate, but let me summarize this. the attacks are now. the question is, are we going to build cyber bomb shelters? now, this isn't like the old bunkers of old. this is where we work with the private sector. remember our grid and our telecommunications is owned and operated by the private sector. we cannot do this without the private sector, so we, your government, comes together with a legislative framework that's

constitutionally sound, legally reliable. the fact that we will make the best and highest use of our military under that. but at the end of the day, we will be able to have a voluntary framework bringing the private sector together with incentives, particularly around liability, that invites them to participate in the formulation of the regulation, the implementation of the regulation, and living by it. this is not regulation that leads to regulation. thi-- that leads to strangulation. this is regulation that helps them protect the united states of america. so let me conclude by saying this: everybody says, gee, what could i do? could i have protected an attack on the united states of america? what's that good ol' group we didn't didn't know how to spell ten years ago? wasn't it something like

al qaeda? would we have done anything in the world to protect the 9/11 attack? i certainly would. i certainly would. but i say here today, if you want to protect the next big attacks on the united states of america, vote for cloture. let's have an informed debate. let's find at the end of the day, the sensible center that will give us the constitutionally but effective way of defending the united states of america. mr. president, i yield the floor. mr. president, i note the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

quorum call:

a senator: mr. president? the presiding officer: the senator from wyoming. mr. barrasso: mr. president, i ask unanimous consent that the quorum call be vitiated. the presiding officer: without objection, so ordered. mr. barrasso: thank you. i ask unanimous consent to speak as if in morning business. the presiding officer: without objection, so ordered. mr. barrasso: thank you. i come to the floor today to do as i do week after week as a doctor pro practiced medicine in wyoming taking care of families from across our state for a quarter of a century, to give a doctor's second opinion about the health care law. one of the central claims of president obama and democrats from washington who voted here in this senate chamber was that the health care law would extend insurance coverage for millions of americans. that was their goal. they claim that is what has happened. the president claimed repeatedly that 30 million more americans would receive health coverage because of the health care law.

well, after practicing for 25 years, i understand that there is a huge difference between health coverage and health care. when people have a health insurance card, then they have coverage. when people have access to a doctor or a nurse or a nurse practitioner or physician assistants, then they can receive health care. "the new york times" actually pointed that out this sunday morning, front page above the fold. they proclaim in the first paragraph of an article that the president's health care law delivers coverage but not care. as a matter of fact, mr. president, when i take a look at this article, sunday, july 29, 2012, "new york times," page 1 above the fold, "doctor shortage likely to worsen -- to worsen -- with the health care law." underneath it says "primary care

is scarce" in bold letters. and beyond that "expanded coverage but a greater strain on a burdened system." the story highlights a study from the association of american medical colleges which found that in 2015, just three years from now, the country will face a shortage of over 60,000 doctors. by 2025 the shortage is expected to expand to approximately 130,000. while the nation was already facing the shortage, the article points out that it has been made worse -- worse -- by the president's health care law. the shortage of providers is very important because, as the article states, coverage will not necessarily translate into care. this is especially true for those individuals who are supposed to receive their health care through medicaid. remember, a huge expansion of medicaid was a part of the president's law.

it was part of the discussion in the supreme court, the decision they came out with. and medicaid, of course, is the program that provides health care for low-income americans. you'll recall that the president's health care law contained one of the largest expansions of medicaid in the program's history. the president chose to expand the program despite the fact that fewer than half of primary care clinicians are -- would accept new medicaid patients as of 2008. fewer than half of primary care clinicians were accepting new medicaid patients. but yet, that is where the president chose to build his health care reform from. so you say why is it that so many physicians, primary care physicians aren't seeing medicaid patients? it's because the reimbursements provided to doctors are so low that many simply can't afford to see medicaid patients and

continue to keep their doors open. unfortunately, the outlook for medicaid really in this country, mr. president, has not improved. "usa today" reported this month, in july, that 13 states are moving to cut medicaid even further by doing a couple of things. they want to reduce benefits. they want to pay health providers less or tighten eligibility for the program. so the program that the president highlights is that one of the cores of his health care law is already in significant trouble. it is not functioning and is getting worse. so the state of illinois has imposed a new limit on the number of prescription drugs that a patient can receive who is on medicaid. this cap was imposed as part of a plan to cut $1.6 billion from the state's medicaid program. mark higherman, professor at the university of chicago law school, told "the chicago tribune" that the prescription drug limits amount to a denial of service.

that's what we're looking at now, and yet this is the basis upon which the president has built his health care law. according to the most recent estimate by the congressional budget office, over one-third of the people expected to gain insurance coverage under the president's health care law are supposed to do it through this medicaid program. clearly with states being forced to cut back their existing medicaid programs, there are many people who are not going to get the care that they were promised through the president's health care law. for those who can find a physician, many of these patients will have to commute longer distances and will also have to endure longer waiting times just to get the treatment that they are seeking. now, some experts have described this as an invisible problem, and they say that is because people may still get care, but the process of receiving that care will be more difficult. now, the chief executive of the california medical association says it results in delayed care

and higher levels of acuity. the seriousness of the injury or the illness to that patient when they finally get the care that they need. so when care is delayed, medical problems can become much more serious, and that forces patients to seek treatment through other settings. one of the prime examples of that is heading to the emergency room. the whole goal that i remember the debate here on the senate floor listening to my colleagues on the other side of the aisle is that patients under the president's health care law, the democrats claim, would be able to get to see a doctor, a primary care doctor, wouldn't have to go to the emergency room. but that's not what we're finding under the president's health care law. we're finding just the opposite of what the president had promised. that's why the american college of emergency physicians told the "wall street journal" -- quote -- "while there are provisions in the law to benefit emergency patients, it is clear," they said "that emergency visits will increase as we have already seen

nationwide." so, the president says one thing. the american college of emergency physicians is telling you what they're seeing on a daily basis in the emergency rooms across the country. put another way, since the president's health care law exacerbated the shortage of providers, more patients are seeking treatment in emergency rooms. it's not what the american people were looking for in health reform. so instead of making empty promises, supporters of the health care law should have dealt with the issues that are already causing many doctors to rethink their medical career. for example, supporters of the law refused, absolutely refused to deal with the crushing burden of medical lawsuit abuse. it's an abusive situation that is forcing doctors to practice significant amounts of defensive medicine, which is very expensive. expensive for patients, individual patients as well as expensive for the system. the harvard school of public health found that these costs

amount to 2.4% of annual health spending in the united states, or $55 billion in 2008. that's the harvard school of public health. there are other estimates out there which go with much higher numbers. apparently supporters of the law thought it was more important to help trial lawyers instead of patients. so, as a matter of fact, howard dean, the chairman of the democratic national committee, has said that they left lawsuit abuse out of the health care law because of the significant impact trial lawyers have as contributors to the democratic party. so here we are. additionally, the health care law does nothing to stop the crushing burden of government regulations and paperwork that are consuming the health care profession. finally, many people choose to become doctors because they enjoy being able to innovate and create the next generation of devices and treatments. unfortunately that is changing as a result of the significant taxes that are part of the health care law. in an article published on friday, we have learned that

cook medical, which is a medical device company in indiana, announced that it was scrapping plans to expand because of the president's health care law. and there are similar companies in states all across the country, many with large medical institutions who have a history of the best innovation in the land and actually in the world. but are faced with these medical device taxes, not -- not on profit, but on sales, on the gross amount of money sales. the company said the 2.3% medical device tax contained in the law would stop the company from opening five new plants in the united states and adding approximately 300 new well-paying jobs. the senate should also know that this cook medical company produces medical devices that address women's health issues. specifically, the company produces products related to gynecologic surgery, obstetrics and assistive reproduction, just to name a few.

therefore, the president's health care law is actually hurting -- hurting -- the ability of cook medical and other companies to provide american women with access to cutting-edge medical technology. why? because of the device tax, which i believe, i believe we should repeal the entire law. but clearly we have introduced legislation to repeal the medical device tax. it is a bipartisan piece of legislation supported from both parties and should be passed immediately. but it does seem that democrats are reluctant to look at partsest health care law and repeal the law. it means that medicine is becoming less of an attractive career choice for many young people across the country, and as cnn stated in a headline from july 29, just two days ago, "your health care is covered" they said, "but who's going to treat you?" the president and washington democrats did not seem interested in addressing this question when the health care

law was passed and more effort was putting into hiring i.r.s. agents to look into your, whether you had insurance than actually to see if there were doctors and nurses and nurse practitioners, and others, physician assistants to care for you. so instead of focusing on policies that would give incentives for more people to become health care providers, they filled their law with empty promises that the american people know today have not been kept. it is time for congress to repeal the president's health care law, replace it with real reforms that will improve the ability of patients to get the care they need from a doctor they choose at lower cost. that's, mr. president, why i come to the floor with a doctor's second opinion about a health care law which, as "the new york times" sunday front page said, "doctor shortage likely to worsen with health law. primary care is scarce. expanded coverage, but a greater strain on a burdened system."

as i have been saying for a number of years here on the senate floor, coverage will not necessarily translate into care. thank you, mr. president. i yield the floor and note the absence of a quorum. the presiding officer: the clerk will call the roll quorum call:

quorum call:

quorum call:

the presiding officer: the senator from illinois. mr. durbin: i ask consent the quorum call be suspended. the presiding officer: without objection. mr. durbin: the bill spending before us is the sierkd. for most people -- the cybersecurity act. a few months ago members of the senate were invited to a classified briefing. it was a briefing senator mikulski of maryland asked for to explain what this was all about. we had been hearing over and over again from the defense establishment in america that the number-one threat to america's safety and security was no longer just terrorism, it was cybersecurity threats and terrorism. for most people, not quite

sure, they've not seen any examples of it could make a difference. here's what we saw. they took to us a classified room, closed the door, took away our blackberries and iphones and put them in a separate place, i'll explain why in just a moment, and took us in a room and briefed us on an example, just a theory, what if. what if a subcontracting company that supplied a major public utility in a city like new york had a problem and someone stole a laptop from one of the employees. and that theft went unnoticed or unreported for a number of days. and then the laptop either reappeared or didn't, what could happen. well, what could happen was if that laptop computer had certain information in it that not only told you how to get into the computer system of the company, the subcontracting company, but also the public utility, bad

things could occur. so getting inside that computer laptop, getting inside the technology of the subcontractor, and then finding that bridge, information bridge into the public utility could create an opportunity to turn out the lights in the city of new york. that was the exercise we went through. god forbid it would ever occur but they said when you turn out the lights in a major american city like new york, terrible things happen. not only does the traffic signals stop and lights don't go on at night and the new york stock exchange isn't operating, hospitals are on emergency generators and problems start popping up in every single direction, water purification, the pumps that keep the subway system under the city of new york going so that the subway tunnels aren't flooded, all of these things on top of one another while this tragedy is occurring, the people in our government are trying to figure out what happened.

and how do we put things back into place and get them moving again. that was one example. there was another example. it was an exmple at one of our defense research laboratories. top secret. nobody can get in. right? and they told us the example -- i don't tell you the it the state where it was located, they told us an example where the employees at our top defense research laboratory who were trying to figure out countermeasures to stop attacks against the united states and to develop our own weaponry, had what appeared to be a harmless email sent to the employees saying explanation of your new health care benefits, just click below. it turned out that click brought in the hackers into the system. so what we're talking about here has consequences that go far beyond the harassment of some teenage hacker who is trying to get into some company computer or even the school's computer.

i was on a plane yesterday with a gentleman who is working for the national institutes of health and i asked him about cybersecurity. he said we think about it every day. every day because hackers are trying to get into the national institutes of health technology and computer system. i said what for? well, some of them are in there for insidious reasons. but some of them are childish hackers and i said what do they do? well, they'll come in, for example, and change our accomplished list of antidotes to certain poisons so we always have to keep an eye on it to make sure they haven't changed what people, doctors should use across america. think about it. think about all the possibilities and what we're trying to do today is to come up with a line of defense for america. we are trying to establish a working relationship between all levels of our government and the private sector of the united states to keep us safe. because what they told us was every single day, china, russia, iran are on the attack.

cybersecurity attacks into the united states, not just the ones i've mentioned, but far beyond. defense contractors, building the planes and the armaments and all the artillery and the like, they have to worry about whether or not their secret plans, their patented information, is being stolen right from under them. stolen by someone who wants to compete with them or perhaps wants to go to war with them. that's what's at stake here. so for a long time we've been warned and forewarned to do something about it. the bipartisan consensus among defense and intelligence experts in the public and private sector is that our nation is dangerously vulnerable to cyber attack at this moment. the f.b.i. director, bob mueller, an extraordinarily great public servant, says the threat our nation faces from a cyber attack will soon equal or surpass the threat from al qaeda and more traditional forms of terrorism. navy admiral mike mullen, chairman of the joint chiefs,

said the cyber threat has no boundaries or rules and the reality is the cyber attacks can bring us to our knees, unquote. according to our director of national intelligence, james clapper, russia and china are exploiting our vulnerability. his unclassified assessment is entities within these countries are already -- quote -- "responsible for extensive illicit intrusions into u.s. computer networks and theft of intellectual property" -- end of quote. we've got to respond to this, mr. president. and we have to do it quickly. i want thank senators lieberman, collins, feinstein and rockefeller for putting together this bill. the cybersecurity act of 2012. they've introduced an approach that is balanced, bipartisan, and responsive to legitimate concerns raised by the intelligence community, private city, -- industry, and privacy advocates. the siebd will make us safer. -- the cybersecurity act of 2012 will make us safer. pipelines, electrical grids,

water treatment facilities, transportation systems, even financial networks are increasingly vulnerable to attack. bad actors in other countries have already demonstrated their ability to use the internote take control of computer systems -- internet to take control of computer systems. last year there was a 400% increase on signary tacks on the -- cyber attacks. in response to concerns raised by some in the private sect disper some on the other side -- sector and some on the other side of the aisle, senator lieberman and collins revised a section of the bill. the bill now creates a voluntary incentive-based system of performance standards. private companies and government agencies will work together to determine the best practices in each sect to her prevent a cyber -- sector to prevent a cyber attack. companies who voluntarily implement the standards will be awarded with immunity from punitive damages in lawsuit, receipt of realtime cyber threat information, and expedited security clearances, among other things.

this voluntary arrangement replaces the mandatory system in an early version of the bill. many of us supported that approach, but in the spirit of compromise and responding to concerns expressed by the business community, the managers have included this voluntary approach. the cybersecurity act also authorizes voluntary information center -- sharing. the sharing provision will allow government agencies and willing private companies to enhance the mutual understanding of the real threat and other vulnerabilities. sharing this information on effective responses and recent cyber threats will enable both the government and the private e private sector to understand the threat and positive to have respond. a handful of industries have already adopted this approach and it significantly enhances their ability to identify and respond to cyber threats. we should empower the government to share its knowledge with these and other industries and we should make it clear that the private companies can share cyber threat indicators with the government. that's exactly what this act does. i want to thank the presiding officer, senator franken of

minnesota, as well as senators coons, blumenthal, sanders, and akaka for working with me and the managers to ensure that we protect privacy and civil liberties. the presiding officer is chair of the privacy subcommittee of senate judiciary. he's been a real leader on these issues. i was happy to work with him. as a result of his efforts and our efforts, the willingness of senators lieberman, collins, rockefeller and feinstein, we're able to significantly enhance the privacy and civil liberties protections in the revised bill. i believe -- i've always believed and i will continue to believe that we can keep america safe and free. we can establish in our democratic society the appropriate defense to any threat without sacrificing our fundamental constitutional rights. the revised bill, after we negotiated with them, now requires that the government cybersecurity exchanges be operated by civilian agencies within the federal government. our thinking was that these agencies are more prone to

oversight and any excesses by them will be caught earlier than if this is done on the military side, to be very blunt. military and spy agencies should not be the first recipients of personal communications like e-mails. but from time to time, they will need to be informed and we need to rely on their expertise. that's why the bill requires that relevant cyber threat information be shared with these agencies as appropriate in realtime. the revised bill eliminates immunities for companies that violate the privacy rights of americans in a knowing, intentional or grossly negligent manner. to ensure that cybersecurity exchanges are not used to circumvent the 4th amendment, the bill requires law enforcement to only use information from the cyber exchanges to stop cyber crimes, prevent imminent death or bodily harm to adults or prevent exploitation of minors. the revised bill creates a vigorous structure for strong, recurring and independent oversight to guarantee transparency and accountability.

it gives individuals the authority to sue the government for privacy violations to ensure compliance with the rules for protecting private information. these commonsense reforms improve the information sharing section of the bill and they protect the privacy. that's why they've been widely embraced across the political spectrum, from left to right. i think we've found the sweet spot. i think we've found the right balance. that kind of endorsement across the political spectrum suggests that's the case. well, we are very vulnerable in the united states at this very moment. our critical infrastructure is at risk and billions of dollars worth of intellectual property is being stolen. our national security is compromised. to put the cyber threat in perspective, general keith alexander, director of the national security agency, was asked, how prepared is the united states for a cyber attack on a scale of 1 to 10 with 10 meaning we are the most prepar prepared? what was his answer? three. three out of ten.

that's an alarmly assessment. it's a failing grade by any standard. if we don't act now, we'll continue to be at risk for not only the loss of information and economic loss but even worse, mass casualties, a crippled economy, the compromise of sensitive data. mr. president, i know that this bill has some controversy associated with it and i know that there are some in the business sector who think we've got too far. i would plead with them, work with us, let's do this and do it now. to let this wait is to jeopardize the security this country -- security of this country. we didn't think twice to respond quickly after the 9/11 attacks to make america safe. you see it everywhere we turn. if you can even imagine what life was like in the united states before 9/11, before you took your shoes off when you went to the airport, before searches were commonplace in american life, before armed guards stood outside the u.s. capitol. those are the realities of what

we face today because of that attack. let us be thoughtful, let us be careful, let us come together, the private and the public sector, let us do this the right way to keep america safe, the people who sent us here to represent them. expect no less. mr. president, i ask the following statement be placed at a separate part of the record. the presiding officer: without objection. mr. durbin: i see senator coons on the floor. i'd like to ask him if -- if i could speak for a few more minutes? is that consistent with you? thank you very much. mr. president, the senate help committee released a report after completing a two-year investigation of for-profit colleges. the 1,096-page report is the most comprehensive analysis yet and provides a broad picture of the for-profit college industry. what senator tom harkin and the committee discovered and carefully, carefully documented is an industry driven by profit which too often has limited concern for the students or the

actual learning process. the report profiles 30 of the biggest for-profit colleges. virtually from every state in the union, including illinois. there are good schools there, make no mistake, and my colleague, senator harkin, has been careful to point them out. but there are also some that are not making an effort. some are trying to improve student outcomes, but unfortunately, there are many of these for-profit schools that are just taking in, soaking in federal subsidies in the form of student aid so they can pay their shareholders extra money. devrie is the third-largest for-profit college in the country. it's based in my state of illinois. it operates 96 campuses, officers classes on-line. in 2010, de vrie had over 100,000 students, an increase of 250% of enrollment in ten years, since the year 2000. it derives almost 80% of its revenue from the federal government. like the other companies

profiled in the report, de v ri e's tuition is significantly higher than that of public colleges. the cost of tuition for a bachelor of science in business administration at de vrie's chicago campus is $84,320 for a bachelor's degree. considerably more than the same program at the university of illinois, where the four-year tuition is $75,000. de vrie looks good compared to many of its peers in the for-profit college sector. unlike some other schools, de vrie's internal documents reveal the school has chosen not to use aggressive price increases in the future. i salute them for that. i've spoken to their leadership and told that if they want to distance themselves from the pack of bad for-profit schools, they have to do it by actually making decisions and implementing them to demonstrate that they are a different kind of for-profit school. there are still areas where de vrie can make improvements. de vrie's institutional loan program, a private student loan

program, charges a 12% interest rate. 12%. the federal government student loan, 3.4%, in contrast. so this rate is roughly three times the federal loan. the help committee estimates that in 2009, when all sources of federal taxpayer funds, including military and veterans' benefits are included, the 15 largest publicly traded for-profit education companies received 86% of their revenue from taxpayers. 86%. they're 14% away from being totally federal agencies. perhaps this would be acceptable if students were really learning and gaining skills to succeed. but what the committee found is troubling. one of the main reasons student outcomes are so poor at these schools is that the schools don't provide students with basic support services that they need to find a job and succeed. student support services are essential to helping students adapt and do well while they're in school and find a job. so what happens instead?

they drop out. or if they graduate, they can't find a job. in 2010, the 30 for-profit colleges examined employed 35,000-plus recruitersment 35,000 recruiters. the same schools collectively employed 3,500 career services staff and 12,452 support staff. so by a margin of 2 1/2-1, the schools had more recruiters than support service employees. so we can't be shocked when we learn that half a million students who enrolled in 2000 to 2008-2009, left without a degree or certificate. among two-year associate degree holders, almost two-thirds of the students in these for-profit schools departed without a degree, just a debt. the report also highlighted a growing problem among for-profit colleges, the use of lead generators. for-profit colleges gather contact information on

prospective students, or leads as they call them, by paying third-party companies known as lead generators. these generators specialize in gathering and selling information. in this case, very personal information. here's thousand works. a student browsing the internet searches for the term like "g.i. bill," "student loan," "federal student aid" or any variation. they're directed to various web site as that are owned by these lead generator companies. the web site then claims to pass the prospective student contact into an appropriate school for the student on-line. typically there's no disclosure to the student that their personal information is being sold to for-profit colleges. when a prospective student does give their contact information, watch out. they will be bombarded with calls and e-mails from aggressive recruiters at these for-profit schools. remember that 35,202 people employed as recruiters. this is what they do. one of the web sites,

gibill.com, was owned by a company called quinn street until last month. 23 attorneys general across the united states did what congress should have done first. as part of an agreement, quinn street gave up its right to the web site that had -- rights to the web site to the veterans' administration, where it belongs. so gibill.com is no longer a deceptive web site, at least in these 23 states where there's been an agreement. other web sites use the name of federal student aid programs and mislead students into believing this is a real government program. one of the help committee's recommendations is to further regulate the private student loan market. senator harkin and i introduced the know before you owe private student loan act this year. our bill requires private student loan lenders to verify the cost of the loan to the person before the loan. and council students as to whether they're still eligible for federal student loans at a much lower interest rate. federal student loans have

flexible payment plans, consumer protections and less costs. but many times, students who have not exhausted their federal student loan aid are steered into private loans with interest rates three and four times higher. there's money to be made off those young sometimes uninformed students. i urge the private lenders today and the for-profit schools that keep telling me, "we are doing the right thing," don't wait for this law. do it now. make this a policy at your school and prove it. one of the students that i wanted to mention is marella tovar from blue island, illinois. she graduated from columbia college this 2010 with a b.a. in graphic design and with $90,000 and with a 10.25% interest rate. well, her balance started to grow. she didn't take out any federal loans. she thought all the loans were the same. she just didn't know the difference. no one told her about the consumer protections in the federal loans. after she used her six-month forbearance permitted by her

lender, she was expected to pay $1,500 a month. unable to get a full-time job in her field, she thought about filing for bankruptcy. wouldn't have done her any good. student loans are not dischargeable in bankruptcy, even if they come from these for-profit colleges. her dad wanted to help her out so he cosigned her private student loans. guess what? dad's now on the hook for the payments, too. marella says if a school counselor had told her about her school payments, she wouldn't have gotten in so deeply. i want to thank senator harkin for his leadership and amazing work on this issue. and i want to plead with my colleagues, on behalf of these students and their families, on behalf of taxpayers who are subsidizing these schools, join us in setting standards so that there is an opportunity for children, young people, to get the education they need without inheriting the debts that can drag them down for a lifetime. mr. president, i yield the

floor. mr. isakson: mr. president? the presiding officer: the senator from georgia. mr. isakson: i ask unanimous consent to address the senate as if in morning business. the presiding officer: without objection. mr. isakson: mr. president, this morning i got some very sad news. the state of georgia and the people of my state lost a giant in the health care industry. tim stack was my friend. he was also the president of the hospital that two years ago treated me and treated me well, which is why i'm standing here tamed he was a giant in health care not just in georgia but in america. so on behalf of myself and all the citizens in my state and the countless thousands of patients whose lives have been made better or even saved by tim, i want to send my condolences to his family. tim stag grew up in pittsburgh, pennsylvania, work being in the steel mills. and when the mills closed, he looked to find a job and he worked in the central supply at the eye and ear hospital of

pennsylvania. he was working and studying to be a teacher and football coach. he became fascinated with the complexity of hospital administration and also challenged by the love of caring for people who were ill. so tim stack changed his major to hospital administration and became a leader in the united states in the administration of hospitals. let me read you his record in atlanta, georgia alone. under his leadership, piedmont health care grew from two hospitals and 8 physician practices to an organization that included five hospitals, more than 50 primary-care and specialty physician practices, a 900-member clinically integrated net work and the piedmont heart institute that treated me two years ago, which is the leading heart institute not just in atlanta and my state of georgia, but throughout the united states of america. tim is one of a kind. his loss will be felt by

countless thousands of georgians. to his family, to his friends who all knew him, i express my sympathy. for the senate, i would like you to know what tim was all about. so i will read a quote from tim that was written in 2006 when he was interviewed by atlanta hospital news for a profile. he wrote the following. "the attributes of a good leader are universal. you need to love what you do be open and inquisitive and persistent, not afraid to make waves if you have to. you should also be personally productive and work well with others, be innovative and allow others to innovate. finally, be a certified member of the human race. cultivate a light touch, be passionate about your career, but be sure to balance it with the rest of your life." that expresses better than i can what tim was all about. i shall miss my friend tim stack greatly as will all of my state of georgia. i send my condolences and sympathy to his wife mary, and

his three sons, ryan, tim, and matthew. i yield back. mr. coons: mr. president? the presiding officer: the senator from delaware. mr. coons: i rise to speak to the issue of cybersecurity, one where there's been a dozen speeches given earlier today and one where i am concerned there's not enough determination, there's not enough will on part of this body to work together to listen to each other, to cross the small differences that remain between camps and competing theories of a bill that we should take up, and i'm here to urge our colleagues in this body to address what we've been told is one of the greatest security threats facing our country: to bear down, to file

amendments, to clear amendments, to listen to other members and to be willing do the job for which we were hired, which is to pass tough, broad, bipartisan legislation to protect this country we love. in my short 20 months in the senate, mr. president, i have increasingly become more and more persuaded that we face a constant, steadily rising, increasingly dangerous threat that foreign nations, foreign actors, whether they be terrorists or enemies of the united states, are not just studying the possibility of some day attacking the critical infrastructure of the united states, they're not just writing position papers, they are a not just theorizing about it, they're not just training in some camp in an obscure country; they are today actively engaged in thousands of efforts to compromise the critical infrastructure of this country.

how members of this body can ignore the importance of this threat when the majority leader and the republican leader have twice, in my short time here, closed the senate and urged every one of us to go to a secure, classified briefing where we have heard from a dozen four-star generals and leaders of three-letter agencies who have told us in great detail about how grave this threat is, why in the face of repeated and publicly cited assertions by secretaries of defense, by heads of the n.s.a., leaders of our homeland security agency and leaders who are responsible for our first responder community, from the federal to the state, to the local level, from the private sector to this government have said over and over, this is a very real, very present threat -- how we can i.g. noer that threat today is beyond me. the bill which is before us is

s. 3414. this is a compromise bill. and in a series of meetings with other members of this border, i have been struck to hear others say, we need more time, we need to study this further, we need to pass the narrow portions on information-sharing which are easy and everyone can now agree on, and we need not pass a broader, more stronger bipartisan bill that deals with infrastructure. as you know well, mr. president, for years critical committees in this body have been working on this issue. senators lieberman and collins, the chair, and the ranking on homeland security and government affairs, have been engaged in working their way through these difficult issues for years. and the relevant committees from energy to commerce to intelligence have been engaged in study and in legislating for years before i became a senator.

in the last few months, there's been some important and strong work to build a bipartisan consensus around the bill that is before us today. i, like you, i believe, mr. president, had some real concerns about the information-sharing portions of the bill, title 7, which have to do with permitting private companies to slayer information with -- to share information with each other about the threats of attacks. one of our big problems right now we're told is that companies of all different sectors of our economy hesitate to share publicly or to share with our national security infrastructure information that's critical to knowing when we're being attacked, how we're being attacked, and how that attack might spread. so title 7 of this bill gives them liability protection to encourage the broad and regular sharing of that information. but those of us who are concerned about the balance between privacy and security, about protecting civil liberties

and whether or not we've gone too far in seeking security at the expense of liberty offered a whole series of revisions and changes to this bill, changes which have been accepted. so, too, in a different section of the bill, title 1, that has to deal with critical infrastructure -- folks from the private sector raised alarms and concerns months ago that this bill was too prescriptive, too heavy handed, was involved in regulation and demanding certain actions by the private sector. those concerns, too, have been addressed, i think, in a broad way. and i have been impressed with how many changes senators lieberman and collins have been willing to accept. out of a broad working group of more than a dozen senators of both parties who over the last few months have come forward with suggestions that have made that portion of the bill truly voluntary for the private sector in a way that balances the role of civilian agencies with parts of our national security

apparatus in a way that provides enough liability protection but not too much and in a way that allows the private sector to have a leading role in setting standards. my point then, mr. president, is to say to my colleagues in this body that when they say we need more time to study, i say, we need to come to this bill, we need to come to the floor, we need our colleagues to be clear: what are your remaining concerns? in a meeting last friday with several senators and representatives of industry, i had read every word of title 7 and urged them to be concrete with us about what their concerns were and i left unsatisfied. i left concerned that some were simply scaring the private sector, some were simply scaring our citizens into thinking this bill is not ready. so for those who still have concerns -- and there may very well be broad and legitimate concerns about this bill and

about its direction -- let's take these two days -- i understand that more than 90 amendments have been filed. i think it is the challenge before us to make the amendments germane, narrowly focused and relevant to improve the bill rather than distracting us into issues that are more partisan or more tied to the campaign and to focus on the work that is left before us. mr. president, if i could, i am grateful concerned about -- i am gravely concerned about hose who would urge us to split off the portion bill. as speaker and speaker has come to the floor and made clear, our electricity grade grid is at ridge our dams and power plants are at ridge our highways and our financial system are watt risk. there are all sorts of areas in the united states where there have been real cyber attacks,

online attacks in other countries that have demonstrated the devastating potential power of our opponents and enemies around the world. in the face of the cautionary notes we've heard from leaders of this body and around the country and in face of that very strong reality, why we wouldn't pass a broad and tough bill that facilitates information-sharing and protects our critical infrastructure and strikes a fair balance in the middle is beyond me. it is not that this body has been too busy. it is not that we are exhausted by having passed too many broad and strong bipartisan bills. we've gotten good work done this session. there are things from the farm bill to the transportation bill where this body has shown an ability to listen to each other across the differences of party and region and craft strong, balanced, bipartisan bills. it is on this topic -- on cybersecurity -- that we have heard ordinary and over there is

no more pressing -- that we have heard over and over there is no more pressing issue. why our if our adversaries are not going to be take month of august off, why if our adversaries are not going to seek to atalks would we not bear down and focus on getting the work done before us as the united states senate. we are called at times the world's greatest deliberative body. and i'll say to you as a member of the foreign relations committee that in other parts of the world there are folks who are striving towards democracy who question whether this is the model they should follow. why not, in the remaining days before we all go to some recess, why not bear down, do our homework, do our reading, be forthcoming with clear and concise concerns, and hammer out our differences? mr. president, i extend an ini havation to any of my colleagues, to any industry

group, to any group of concerned citizens. i am happy to meet with anyone to hear their concerns to try and do my level best to convey them to the bill managers, to the leaders who have done such a remarkable job of hearing and accepting compromise provisions of this bill -- on privacy, on the role of the private sector, on making voluntary what was mandatory, on striking a fair balance. i urge our colleagues to take this moment seriously, to not allow the days to slip, the month to pass, and the moment to pass us by. how will we answer our constituents, our communities, and our families following an attack that has been so frequently predicted, and do we not believe that we will end up regulating in a more heavy-handed, more reactionary, more ill-informed way after a successful, massive attack than now when we have the time to

listen to each other and craft a balanced and responsible and bipartisan bill? mr. president, i will close with this: i am convinced this is the gravest threat facing our country today. graver than that of terrorism from overseas. general keith alexander of the n.s.a. has clarified just in the last few days to a group of us how grave a threat this is. i renew my offer to any member of this chamber. come and meet with me. come and meet with senators lieberman and collins. come to meet with the leaders of the relevant committees. take up your cause and give an amendment that is narrow and focused and relevant and let us hammer out a better defense for this nation. there are those who question the purpose and purposefulness of this body. it has no greater purpose than finding a bipartisan way to

craft a strong and vibrant solution to a clear and growing national threat. just a few weeks ago i had the honor of sitting for lunch with senator daniel inouye. he is the one member of this body to have earned the congressional medal of honor in combat. i asked his advice, as the most senior member of my party: what issue, senator inouye, i asked of him, do you think i should be focused on? what is the thing you urge me, a freshman, to invest my time and energy into? his ample was simple -- his answer was simple, profound and i hope will be heard by this body. he said to me i was the only senator who was at pearl harbor. our next pearl pearl harbor wile from a cyber attack for which we are today unprepared. let us do our duty.

let us listen to each other, come together, hammer out a strong and bipartisan bill, and honor of -- the service and sacrifice of this great generation and do our duty. madam president, i yield the floor. mr. udall: madam president? the presiding officer: the senator from colorado. mr. udall: i want to acknowledge the powerful words of my colleague, the senator from colorado. i have to tell the viewers and all of my colleagues, i couldn't agree more. the time is now to act on cybersecurity. i just came to the floor from an intelligence committee briefing. general alexander was there. as the senator from delaware knows, he's forthright. he's well versed. he's passionate. he's as nonpartisan as they come. and general alexander is urging us to act now. so i want to thank my colleague from delaware for his compelling

and important words. the matter that brought me to the floor has a link to cybersecurity, and that is, if you will, energy security. and i want to talk about one of the new exciting technologies that's resulting in the production of many, many homegrown electrons, and that's wind power. madam president, i've come to the floor on a daily basis to urge my colleagues to work with me to extend the production tax credit for wind. the p.t.c. has created literally tens of thousands of jobs across our country and has the potential to create even more. but if congress -- and that's us. that's the senate and that's the house -- doesn't act to extend it, tens of thousands of jobs literally will be lost. i know the presiding officer has a robust wind energy sector in her state, and she knows the extent to which it's important to business in the great state of new hampshire. it's important to the businesses in every state in our country.

it's an investment in a clean energy future, the production tax credit is. it's a critical investment in american jobs. and, frankly, we're about to lose that investment. and i fear in fact that we've continued through our inaction to create real harm to our wind industry here in america. but it's not too late to act, madam president. so today i'm going to focus my remarks on idaho, a state that's known for its wide open spaces, its mountains, its potatoes, for great, friendly people. you don't have to look any further than senator chai poe and senator -- senator crapo and senator risch to know idaho is a state filled with good people. the national laboratory has calculated idaho's wind resources produces foreign 218%

of identify -- more than 218% of idaho's electricity needs. most of this potential is in the high plains of the southern half of the state. i have to tell you that eyes hoe is already working to -- that idaho is working to take advantage of what is a bountiful resource. there are wind projects either online or under construction across the state. if you look, madam president, in southeastern utah near twin falls, the wolferine energy creek farm, it covers about 5,000 acres and pays royalties to 30 different landowners. in 2011 idaho's installed wind capacity grew by nearly 75%. that growth created hundreds of temporary construction jobs as well as permanent jobs in operation maintenance of these facilities. another number, right now

idaho's wind sources provide power for nearly 160,000 homes without releasing the nearly 1.1 million metric tons of carbon dioxide that traditional power sources would. wind supports close to 500 jobs in the state of idaho, jobs that wouldn't exist if the wind industry had not been enticed to invest in idaho because of the production tax credit, the p.t.c. and wind energy projects are an investment in local and state economies. wind energy producers provide nearly $2.5 million to the state in property tax payments every year and over $2 million annually in land lease payments to local idahoans who invest that money back into their local communities. those are real dollars that these communities count on. madam president, the point i'm trying to make is that we in the congress should be working to help create more projects like

wolverine creek for the jobs and clean energy that they create. but instead the congress is standing idly by. and then, madam president, i can't help but mention that there have been some on the campaign trail who have suggested that we should let the wind production tax credit lapse at the end of this year and that wind power should not be given the same help that other industries have received. i could not disagree more. great states like idaho and colorado and new hampshire make things. great countries like the united states generate their own energy. letting the wind production tax credit lapse would be irresponsible. the p.t.c. equals jobs. we should pass it as soon as possible. we should not waiver and we should not wait. every day that we let this unanswered question hang over our country, madam president,

may be another project and another job that gets shipped overseas. i urge my colleagues to work with me to support manufacturing in rural communities right here in america. let's extend the production tax credit as soon as possible. it's common sense. it has bipartisan support. let's extend the production tax credit. madam president, i'll be back tomorrow to continue this discussion and talk about another one of our great states. i'm at 13 states. i'm going to keep coming back until we get this right. thank you, madam president. i yield the floor.

mr. franken: madam president? the presiding officer: the senator from minnesota. mr. franken: madam president, i ask to speak in morning business. the presiding officer: without objection. mr. franken: madam president, over the last few weeks hundreds of thousands of minnesotans received letters or postcards in the mail from their health care insurers. these notices are letting people know whether or not their insurer met a new rule in the health care law, a rule that i

championed, called the medical loss ratio, sometimes called the 80-20 rule. it could also be called the 85-15 rule. but it's known as the 80-20 rule and i'll explain. this provision which i base on a minnesota state law requires large group insurers to spend 85% of the premiums that they receive from their beneficiaries on actual health care services. they have to spend 85% of the premiums they receive on actual health care services. not on marketing or administrative costs or c.e.o. salaries. these dollars, 85% of their premium dollars have to be spent on actual health care. and for insurers in the small

group and individual markets, this threshold is 80%. hence the 80-20 rule. this summer across america, americans are getting notice s from their insurers that their insurer met or did not meet this 80% or 85% threshold. when those notices tpa*eul to say that the d.n.c. -- say that the insurer failed to meet the medical loss ratio, americans are also getting something in the mail. a check. under my medical loss ratio provision, insurers who did not spend at least the 80% or 85% of premiums on actual health care services for their beneficiaries have to rebate that money to their consumers. august 1 was the deadline for

insurers who didn't meet the m.l.r. threshold to rebate the difference to their consumers. and because of the medical loss ratio, more than 123,000 minnesotans got rebates from their insurer. those rebates added up to an average of $160 per household. there was more in other states. this isn't unique to minnesota. across the country it's 12.8 million americans who got rebates from their insurers who overcharged them. and other insurers lowered their premiums for last year to comply with the medical loss ratio. aetna in connecticut lowered premiums by 10% last year because of the m.l.r. minnesota has a culture of

high-quality, low-cost care. in fact, the agency for health care research and quality recently announced that in 2011 minnesota's health care quality was the highest in the nation. we were number one again. we're always number one or number two or number three. and the medical loss ratio, which was first passed as a minnesota state law, is yet another example of minnesota's leadership in bringing down health care costs while preserving quality. minnesota's unique health care culture includes the mayo clinic, cooperative models like health partners and visionary, public health leadership from state legislators. health care in our state is also distinguished by the fact that 90% of minnesotans are served by a nonprofit health plan.

these plans outperform their national peers and are able to put 91% of every premium dollar toward actual health services. in other words, they have a 91 m.l.r. by taking profits out of the health insurance industry, minnesota health plans do a better job helping our residents live longer, healthier lives and deliver the number-one quality care in the nation. and the medical loss ratio within the health reform law is holding all health plans to the same standards we've set in minnesota by requiring that 80% to 85% of premium dollars actually pay for health services. before this year in other plans throughout the nation, less than 60% of your premiums were put

toward health care. the rest was being used for administrative costs, for marketing, for bonuses and for profits. in -- in fact, one study of insuressers in texas a few years ago showed m.l.r.'s, medical loss ratios as low as 22%. meaning that of all the premiums that families were paying in to their insurers, the insurers were spending only 22% on actual health care services for them. that's why my medical loss ratio provision is so important. it squeezes the fat out of the health insurance market and makes your premium dollars go further. for many families, it's actually lowering costs, delivering

$1.1 billion this year in rebates. those checks, $1.1 billion. in addition, lowering premiums. for example, the 10% reduction by aetna in connecticut. this was an incredibly important step because we know premiums were going up way too fast, a lot faster than those families' income. this is just one way that the health care law is already changing the culture of care in our country. one of the other things that the law did was move toward rewarding quality of care, not quantity of care. specifically directed medicare to start paying doctors based on the value of the care they provide, not the volume. this is a provision that i and senator klobuchar and several other of our colleagues championed called the value

index. because when minnesota doctors get paid less for providing higher quality care, everyone loses. minnesota loses because minnesota reimburses 50% less per medicare patient on average in minnesota than for each patient on average in texas. so minnesota actually gets punished, gets punished for being number one. it gets punished for higher quality care with lower reimbursements. patients in texas lose because they're not getting the highest value care for their health care dollar, and all taxpayers lose. when medicare pays for unnecessary and overpriced services in texas and in other low value states. this is not about pitting minnesota against texas or other

low value states. it's about incentivizing the texases to be more like minnesota, which again has the highest health care quality in the nation, and that will happen when the value -- and that will begin to happen when the value index kicks in under this law. it would be an understatement to say that the law has received some tension this year. i know that there is a lot of uncertainty about our -- among our constituents about how the law will affect them. that's because sometimes there is a little misinformation put out there. i just had a colleague say that there is nothing in the bill to address paperwork, and that is certainly not true. in fact, i authored a provision on simplifying billing.

there is some misinformation on why the i.r.s. agents are there to look into your insurance rather than emphasis anything done in the ad -- in the bill, in the law to address work force shortages. well, that's not true. there is an entire title on work force. you know, sometimes you -- people have to really sort out what's being said on this floor. so there is some uncertainty. so let me just take a moment to talk about just a few of the other things that the law is already doing for the people of minnesota, and this is actually -- this stuff is all in the law and happening, and there is -- i'm just saying, telling

what's going on right now. now, first of all, starting tomorrow, august 1, 900,000 women in minnesota and 47 million women around the country will have free access to preventative health services, including gestational diabetes screenings, preventative health visits with their doctors and f.d.a.-approved contraceptives. because of the health care law, women, not insurance companies, can now make decisions about their health care and can access the services that will keep them healthy. the health care law is also helping families in minnesota and across the country by prohibiting insurers from denying health coverage for children who have preexisting conditions. i have met children who are alive today because of this

provision. and as a parent, i know the -- how grateful their parents are. parents around the country can now sleep a little easier knowing that if their child gets sick, they will still be able to get the health care coverage they need. we should be celebrating that. you know, this isn't about putting the government between you and your doctor, as i hear sometimes. this is about getting the insurance company out of the way. and making sure that children can get coverage and adults. we have seen the elimination of lifetime limits on care. your insurance company can no longer put an arbitrary cap on

your care. i have seen a gentleman whose life was saved because of this. because before this law, before this law came into being, they could drop you, and they did, and that's over, that's done. people don't have to worry about hitting an arbitrary limit and then being thrown off their insurance because they have. we should be celebrating that. that's something that should be bringing a lot of relief for people, and that's why we're going to be having far, far, far, far fewer bankruptcies. parents will also be relieved to know that young adults can now stay on -- have been able to stay on their parents' health care plan until the age of 26 because of this provision 35,000

young adults in minnesota are now insured on their parents' policy. seniors -- i was at a senior center in woodbury the other day, and the seniors are very happy with the changes that the health care law has made. when i visit senior centers in minnesota, i hear relief from seniors who now can pay for their medications, thanks to the provision in the health care law which is closing the doughnut hole. the provision has already allowed 57,000 seniors in minnesota to relieve a 50% discount on their covered brand name prescription drugs when they hit the so-called doughnut hole. at an average of $590 savings per person. and i can see the presiding officer nodding. i know you go to senior centers in new hampshire and know that

when seniors hear that people want to repeal this, they're miffed. i have actually been at a senior center where they went like what can we do and wanted to get up and go out and start being activists for the health care law when they heard that some of my friends want to repeal this, because some of them are just -- they are making it just on social security and now the doughnut hole is closing and they like that. it means that they can take their medication. it means they don't have to take it every other day or they don't have to cut it in half. and my friends on the other side want to repeal it. seniors are also getting free preventative health services under the health care law like mammograms, colonoscopies, as well as free annual wellness

visits with their doctor, and boy do they like that. listen, i could go on and on. i won't. but the point is that because of the law, more people are getting care, the quality of our care is better, and we're lowering costs, and i am proud of that. as we here in the senate head home to spend august in our states, i urge my colleagues to listen as i do when constituents tell us about the rebates they receive. i was on a plane two weekends ago, a woman showed me her check, the woman i was sitting next to showed me her rebate check. so i -- i want to -- i urge my colleagues to listen to constituents talk about the rebates. the kids who are able to stay on their parents' insurance, the health screenings that saved the lives of grandparents. i hope they will listen to the

stories of kids with preexisting conditions who are finally able to get coverage and seniors who are able to afford both their prescriptions and their dinner. i urge my colleagues to acknowlee these benefits and to support the continued implementation of the affordable care act. thank you, madam president. i yield the floor. a senator: madam president? the presiding officer: the senator from delaware. mr. carper: there are several people who would like to be recognized. senator collins would like to be recognized. if she is ready to go, i will yield to her. i would ask unanimous consent to speak immediately after her and then to be followed by senator alexander, if that's the will of the body. the presiding officer: without objection. ms. collins: thank you.

the presiding officer: the senator from maine. ms. collins: thank you, madam president. first, let me thank the senator from delaware for his graciousness. in light of the fact that there are so many people who are waiting to speak, i will be brief, but i want to talk about the legislation that is before us, the cybersecurity bill. madam president, this bill represents the senate's best chance this year to pass urgently needed cybersecurity legislation. now, why do i say that it's urgent? virtually every national and homeland security expert from president bush's administration including president obama's administration has warned us repeatedly that a cyber attack

is coming, and it is an attack that's going to be aimed at our critical infrastructure. and, madam president, for us to let disagreements over exactly how to counter this threat prevent the passage of this bill would be a tragedy and could lead to a tragedy. this is serious. just yesterday, we had a meeting with the f.b.i., with the department of homeland security, with general keith alexander who is the head of cyber command and the head of the national security agency, and they were unanimous in warning us that congress must act and must act now.

every single day, every single day, nation states, terrorist groups, activists, persistent hackers, transnational criminal gangs are probing our cyber defenses. intrusions are rampant. as one expert told me, there are really only two kinds of large companies in this country, one that -- those that know that they have been hacked and those that don't know that they have been hacked. it is so important that we act, and i must say we're working very hard to try to accommodate the concerns that have been raised by some of our colleagues and by some in the business community. we therefore have altered our

bill in a significant way. and, madam president, that's another charge that i've heard thrown loosely around here, is that somehow there hasn't been enough study. somehow there's not enough process. somehow we need more hearings. madam president, our homeland security committee alone has had ten hearings on cybersecurity. ten hearings. the senate as a whole has had 25 hearings. numerous classified briefings. how many more briefings, hearings, and reports do we need? the head of the f.b.i., robert mueller, has told us that in his judgment the threat of a cyber attack will soon exceed the threat of a terrorist

attack. of course they may be combined. it may be a terrorist group using cyber tools to launch an attack on this country. there's a web site video that an arm of al qaeda has that encourages cyber attack and talks about how easy it would be to conduct it. now, senator lieberman and i, along with our two principal cosponsors, our three principal cosponsors, senator feinstein, senator rockefeller, and senator carper, have made significant changes in our bill to respond to concerns that have been raised. most notably, we've gone from having a mandatory framework to a voluntary approach to enhance the security of our most critical infrastructure.

the underlying concept of this approach, which was suggested in a very constructive way by our colleagues, senator kyl and senator whitehouse, is to encourage owners of our most critical infrastructure to enhance their cybersecurity by providing them with various incentives, the most important of which is liability protections. we've also made changes to improve the privacy protections in the information sharing title of our bill. the bill establishes the multiagency council, the national cybersecurity council to respond to concerns that too much power was being given to the department of homeland security. so now we have an interagency body that includes the department of defense, the

department of justice, represented by the f.b.i., the department of commerce, the intelligence community, undoubtedly it would be the director of national intelligence's office. and appropriate sector-specific federal agencies such as ferc, if we're talking about how to -- how best to protect our electric grid. the council would work in partnership with the private sector, would conduct risk assessments to identify our nation's most critical cyber infrastructure. now, madam president, what do we mean about that? we hear that term. what exactly is critical cyber infrastructure? it is that which, if damaged, could result in mass casualties casualties, mass evacuations, catastrophic economic damage to

our country, or severe harm to our national security. madam president, don't we want to safeguard critical national assets that if damaged would cause numerous deaths, people to flee their homes, their communities, a disaster for our economy, or severe blow to our national security? i can't believe there's even any discussion about the need for us to have robust systems to protect us against mass casualties, a devastating blow to our economy, and catastrophic consequences. that's a high bar in our bill

for defining what is critical cyber infrastructure. it isn't every business in this country, and those that are implying that it is and this is sweeping are not accurately reading the bill. we would be irresponsible if we did not act when the warnings are so loud and are coming from so many respected sources. we have had the aspen institute group on cybersecurity issues endorse our bill and urge us to go towards its consideration. that is chaired by president bush's homeland security secretary, michael chertoff,

and by a renowned expert on the other side of the aisle, former congresswoman jane harman. but it also includes people like paul wolfowitz, not exactly a liberal activist the last time that i checked, but certainly one who commands great respect for his knowledge in this area. i am amazed that we are letting the clock tick down when we know it is not a matter of ifs there is going to be a cyber attack on this country, it is a matter of when. madam president, let me just very briefly address another issue. is there some opposition among the business community to this

bill? yes, there is. but there is also a great deal of support from the business community. we have, for example, a letter from the mdia, which represents 1,750 defense firms. we have letters of endorsement from cisco and oracle, from the silicon valley leadership group, from the business software alliance, from symantec, from e.m.c. corporation, from the center for a new american security, from -- endorsements from individuals in the previous administration like general hayden, like mike mcconnell, asa hutchinson, there are many,

many supporters for this bill. and it's not surprising, because they know how important it is that we act. finally, madam president, i would ask unanimous consent to put into the record a letter that we received or that the two leaders received today from general alexander. the presiding officer: without objection. ms. collins: and, madam president, i was hoping to read you a little excerpt from that letter, but -- and i now have it thanks to my able staff. let me just in closing read a little bit from general alexander's letter, which is dated today.

in it, he says "i am writing to express my strong support for passage of a comprehensive, bipartisan cybersecurity bill by the senate this week. the cyber threat facing our nation is real and demands immediate action. not action next year, not action next congress, not action even after the recess that we're about to take. as general alexander says, the time to act is now. we simply cannot afford further delay. -hourover, to be -- moreover, to be protecting against this threat to our national security, cybersecurity legislation should address both information sharing and core

critical infrastructure hardening. that is exactly what the bill that we have brought before the senate would do. and i would urge our colleagues to join us. if they have other ideas, offer amendments, but let's get on with the task before us before we're looking back and saying why didn't we act, why didn't we pay attention to all of those warnings? thank you, madam president. mr. carper: madam president? the presiding officer: the senator from delaware. mr. carper: while she's still on the floor i want to engage in a brief colloquy, we're ad libbing, what we call in football an audible. we have the two most key

people, senator lieberman and senator collins, have worked very, very hard with our staffs to fashion this legislation. in recent years when we heard opposition to doing something on cybersecurity, the concern we had it's going to be a top down. this is going to be homeland security, which frankly back in its early days didn't have a very good reputation. the idea that somehow homeland security is going to be running this, top down, without a whole lot of input from industry, basically we've taken even -- second most recent version of our bill and changed that. what we said it's not going to be top down, it's not going to be homeland security saying these are the best practices and standards to protect against cybersecurity, but industry, why don't you tell us, us being homeland security, us being department of defense, us being national security agency, us being the f.b.i., what you think those best practices and standards should be. and give us a chance to work on

those together, and at the end of the day, correct me if i'm wrong, but i don't think the deal is for homeland security to come back and say no, got to throw those away. we'll do it our way. that's not what's going to happen here. in our meeting yesterday with folks from f.b.i., national security agency, what -- that's not the way it's going to work. not the way it works today, not the way it's going to work in the future. what do you think? ms. collins: madam president, --. the presiding officer: the senator from maine. ms. collins: madam president, if i could respond flew the chair to my colleague from delaware, he is absolutely correct. this is a collaborative partnership with the prek and -- private sector, and indeed it has to be. 85% of critical infrastructure is owned by the private sector. so it makes sense to have their involvement. we've restructured the bill to

require that and there is another safeguard. since this is a voluntary system that we have now devised, adopting the kyl-whitehouse approach, if the private sector decided not to participate, it essentially invalidates the standards that are developed. so why would this interagency council, which has developed the standards based on the recommendations of the private sector, not adopt reasonable standards? they want industry to participate. that's the ultimate safeguard. i would say to my colleague from delaware and my colleague, the chairman from connecticut, who also may want to add to this. mr. carper: let me say, madam president --

the presiding officer: the senator from delaware. mr. carper: i'll direct this question to our chairman through you, but one of the criticisms of our bill was not only was it top down, oriented, directed by homeland security but also there were just sticks involved. we were not going to incentivize anybody to comply with the standards that might be developed, but we would just hammer somebody. that's not the way it's turned out. and i commend the chairman for doing that but would you just lay out for us in a minute or two here how it would work? i think it's a much smarter approach. mr. lieberman: madam president? the presiding officer: the senator from connecticut. mr. lieberman: i thank my friend from delaware for the question. this is now a voluntary system. there's a lot to be said about that. i want go back to that meeting yesterday. we had a broad bipartisan group of senators who have been most active but from different perspectives on this question of

cybersecurity legislation, who met yesterday with the key cybersecurity officials in our government, from the department of defense, department of homeland security, f.b.i., and national security agency. and here's -- i'm going to explain why we went to the carrots and took out the sticks by saying in general terms that these experts, not political people, these are pros who deal with cyber defense, were asked by one of the senators, what will happen if we don't adopt this legislation or something like it this session? and the cybersecurity professional said to us our nation will be more vulnerable to cyber attack. in other words, this legislation contains authority

to share information between the government and the private sector, between two private sector companies that can't be done now. that's critically necessary to improve our defenses. the requirement of standards being promulgated as a result of a -- resulting from a public-private collaborative operation and then offering the carrot of immunity from liability is something that doesn't exist now, and all the experts say though some of the private sector operators of critical cybersecurity infrastructure -- and we're talking again about the companies that run the electric grid or the telecommunications system or the entire financial system, or dams that hold back water, we're not talking about mom-and-pop businesses back home, some of them are doing a

pretty good job of defending that cyber infrastructure, but most of them are not doing enough. and that's where the government has to come in and push them in that direction. so why did we change it from mandatory to voluntary, from sticks to carrots? because we didn't have the votes to adopt the mandatory, which i think is necessary. so -- and because of the urgency of the threat, as i just reflected that we heard yesterday from the professionals in this area, we said senator collins and i, senator rockefeller, senator feinstein, senator carper, okay, you can't get 100% of what you want around here and we understand that, let's settle for 80%, perhaps the other side will feel they got 80 pest. perhaps more important, we'll get something done to protect our security. i must tell you, madam president, that we're at a point now in this debate with the -- with the kind of

never-ending questions about every detail, notwithstanding all the compromises senator collins, carper and i and others have made, that it feels to me -- and the filing of an amendment by senator mcconnell to repeal obama-care -- you can have a position on obama-care, but to put it on this cybersecurity bill? not fair, not relevant, not constructive. i think we're coming to a moment where we're going to have to face a tough decision. and i've talked to the majority leader about filing for cloture soon so we can draw this to a choice. do our colleagues want to act to protect our -- our cyber systems in this session or do they not? and that's a -- that's a tough choice, particularly if you vote "no" to explain in the light of all the evidence of the constant cyber attacks going on in and the cyber threfts of hundreds of billions of dollars from our industries and tens of thousands

of jobs lost as a result to foreign countries. whether you're going to say, no, we don't want to take that up now. i hope and pray that that's not the case. but the way this is moving right now, in this last week of the session before we break, i'm afraid that we're -- we're headed in the wrong direction and we don't see the kind of willingness to compromise that really ought to be there. i mean, we're tested again in this chamber. are we going to -- are we going to deal -- are we going to fix national problems? it's hard to do on some of the fiscal issues we've turned away from. but on this one traditionally on -- when it came to our national security, we've put special interests aside and together dealt with the national security interests. and i fear at this moment, in response to my friend from delaware, that that's not the direction in which we're going. i hope we're -- i hope i'm wrong, and i'm by nature an optimist. but right now i'm a pessimist. i yield the floor.

mr. carper: madam president? the presiding officer: the senator from delaware. mr. carper: my colleagues have heard me say this before. we've been joined by senator rockefeller who's done great work, and senator feinstein and others, democrat and republican on this legislation. but i love asking people who've been married a long time, "what is the secret to being married a long time?" there's a special quote of me saying this with senator collins sitting on the floor and she -- certainly her husband-to-be anticipates their coming marriage, but i love asking people married a long time, "what's the secret to being married a long time?" i get great answers, funny answers but also some prefoun pd ones. one of the best ones i got was the two c's. two c's. and part of the two c's, communicate and compromise. that's not just the secret for a long marriage, a union between a husband and wife, but it's also the secret for a vibrant democracy. and i think it's really characterizes -- the two c's characterize what's going gone

on with this legislation. because -- i've been here awhile, 11 years, i don't know that i've ever seen better communication on an issue of this importance than i have in this -- in this instance. it's very, very -- very dramatic, very satisfying. and, frankly, compromise. the kind of compromise we just talked about in the last 15 minutes or so. needed, given, done willingly. and to lead us to this point. to -- today. i -- it's been said before, i'm going to say to the senator, madam president, our -- the reason why we're on this bill today, why we're taking it up today, this week, is because our economy, our national security are under attack. this is not the kind of war that some of us served in in our youth. this is not the kind of war we've read about in history books. it's not the kind of war we've seen and watched on tv. this war is occurring in cyberspace and it's occurring in realtime. literally as i speak, it's being

carried out by sophisticated criminals, by terrorists and even by other countries. and while some hackers just want to cause mischief or maybe make a political point, others want to hurt people, our people. still others want to steal our ideas, our intelligent intellecl property, as well as other sensitive information. from medical research to corporate mergers. cyber spies are looking to steal some of our very innovation as that fuel our economy and help make us a great nation. general keith alexander, commander of u.s. cyber -- u.s. cyber command, has called these efforts the greatest -- this is a quote -- "the greatest transfer of wealth in history." and those of us who try to put a dollar figure or just how much intellectual property we're losing to cyber theft, have put the price tag at about a quarter of a trillion dollars per year. but it's not just valuable information we're losing. to put it bluntly, it's american jobs.

and it's our competitive edge. and, of course, the same vulnerabilities being exploited to steal our intellectual property can be used by those who want to attack us to do physical harm. with a few clicks of a mouse, cyber terrorists or sovereign nations could shut down our electric grid, they could shut down manufacturing, broad base, they can release dangerous chemicals into our air, they can release dangerous chemicals into our water supply, they can disrupt our financial systems. at the very least, any one of these attacks could further slow the economic recovery of our country or disrupt it altogeth altogether. and in a worst-case scenario, a particularly lethal signary tack could throw parts of our country into -- lethal cyber attack could throw parts of our country into turmoil. and even lead to loss of life. if you don't believe that, just look at the recent summer storms and power outages had on this

region. if we don't become more victim lent and soon, a hacker could succeed in locating that kind of power outage, putting many lives in danger and severely undercutting the productivity of our work force. the revised bill we take up today takes a number of bold steps to better ensure our critical infrastructure and better secure cyber information t. will go a long way towards bringing our cyber capabilities into the 21st century. it represents a good-faith effort to address legitimate concerns of businesses and privacy groups, of our intelligence community and of senators on both sides of the aisle here. none of this bill's five original cosponsors is suggesting that our bill is perfect. as my colleagues hear me say from time to time, if it isn't perfect, make it better. and with that thought in mind, we look forward to working together with all of our colleagues, awful our colleagues, to find common ground to make this legislation even better. for example, many of my colleagues and i are concerned we don't have the property safeguards in place on private

shftion informationinformation,l security numbers and financial records. the american public expects that government agencies and private businesses hold our tax information, our medical recor records, other sensitive data will take every precaution necessary to ensure that sensitive information is secure and well protected. well, too often those expectations are not met. that's why i've introduced a bipartisan amendment with my colleague, senator blunt, to address concerns regarding data breaches which occur all too often. our amendment would ensure that americans can be confident that their private and sensitive information is made more secure. as our nation becomes increasingly reliant on technological advances to do just about everything, it's imperative that we not let technology outpace our ability to prevent fraud and identity theft. however, with the recent breach within the federal employee retirement program, the thrift

savings plan, over 100,000 -- over 100,000 federal participants know all too well that their sensitive private information is not always safeguarded as it should be. the amendment that senator blunt andry offering seek to make sure that all entities holding sensitive personal information have to adhere to national standards designed to keep information safe while ensuring that both consumers and law enforcement are promptly notified in the event of a breach. this requirement would require that the current patchwork of 46 separate state laws while ensuring that consumers have a uniform set of protections that they can understand. by adopting this data breach amendment and passing the broader social -- the broader cybersecurity bill, we will enable the u.s. to lead by example. both in preventing cyber attacks from occurring in the first place and in responding swiftly and effectively to protect consumers in the unfortunate event of an attack or a breach. so, as we consider our amendme

amendment, the blunt-carper amendment, let's remember that this bill is not the finish li line. if i could paraphrase winston churchill, this is not the end. this is not the beginning of the ends. this bill really represents the end of the beginning. and as beginnings go, it ain't bad. and although we're still working out a compromise, i want to just close by talking very briefly about some of the features of the underlying bill that we're considering. first -- and i'll reiterate what's been said before, it bears repeating -- first, we've elected not to direct the department of homeland security to mandate new cybersecurity regulations for private owners of critical infrastructure. we said we're not going to do that. instead, we've endorsed an approach that relies on a public-private partnership and a voluntary cybersecurity program to strengthen the electronic backbone of our most sensitive systems. instead of government penalties, our bill calls for using incentives like liability

protection to encourage critical infrastructure owners to adopt voluntary practices developed by industry. second, our revised bill provides a framework for the sharing of cyber threat information between the federal government and the private sector. while offering liability protection and better privacy protections for all americans. and, third, to ensure that federal agencies are better equipped to stop cyber attacks on them, the bill includes a number of security measures that i've worked on for years with senator collins and others to better protect our federal information systems. in particular, this bill will help replace our outdated paper-based security practices with realtime security systems that can actively monitor, detect and respond to threats. for example, agencies will be required to continuously monitor their systems like a security guard would watch a building through a video camera, rather than just taking a snapshot, developing the film and reporting on the results once a year. i'm happy to yield to the

chairman. mr. lieberman: i thank my friend. and this will be very brief. i ask unanimous consent that the period for debate only on s. 3 3414, the cybersecurity act, be extended until 6:30 p.m. and, further, that the majority leader be recognized at 6:30 p.m. the presiding officer: without objection. mr. lieberman: and i would add that the statement by my friend from delaware not be interrupted by that motion. the presiding officer: also without objection. mr. lieberman: i thank the chair and thank my friend. mr. carper: happy to yield. finally, mr. president, our bill makes a number of important investments in developing the next generation of cybersecurity professionals. this is work force development. for example, the bill provides stronger cybersecurity training and establishes better cybersecurity programs in our schools and in our universities. this legislation also makes research and development for cybersecurity a priority so we can develop cutting-edge technologies here at home and bring jobs to our