the system we build for the collection, processing, desemination of data. that's a bigger problem and far more challenging looking at robots killing people. .. >> when we see today the ability of groups i would say to put countries under pressure, and it is very -- [inaudible] when you see groups, individuals

being able, having almost a strategic effects with ied in countries, i ask myself, is this still a question in well, we better develop very modern, very expensive tools to do that. i'm not sure. but nevertheless, this is a case for a global approach, and i think nato is very nice forum for that, 28 countries, a lot of corporations with a property of promise that we will have to set up the scene for a real dialogue about this very -- [inaudible] >> just quickly, i wanted to add to this because, you know, most of the early part of this conversation we were reassuring ourselves that, you know, the involvement of judgment and targeting and intelligence --

>> we're going to lee the last -- leave the last few minutes of this event for some live programming. you can see this and any c-span program anytime online at c-span.org/videolibrary. we go live now to the center for american progress and their event on using 'em 9/11 domain -- eminent domain. you're watching c-span2. >> good afternoon, everyone. welcome to the certain for american progress. i'm michael ettlinger, i'm the vice president for economic policy here, and thank you all for coming. it's an interesting time for the housing market. i suppose we could have said that at any time in the last five years or so, but things are changing a bit. after more than five years of decline, markets around the country seem to be doing somewhat better. home prices are going up, home construction is showing signs of life, and foreclosures are at a five-year low. on the other hand, we're still

suffering from a serious overhang from the crisis. more than four million households have lost their homes through foreclosure, and this is, of course, been very bad for families, bad for communities and bad for state and local budgets. on top of that, home prices, home price declines wiped out roughly $7 trillion in household wealth and left more than 10 million families underwater on their mortgages, owing more than their homes are worth. in particularly ard-hit communities such as las vegas and san bernardino, more than half of all home openers are underwater, and many by more than half of their home's value. and this is creating some significant problems. for one thing, underwater homeowners are at a much greater risk of foreclosure in part because of in the event of some other financial setback, the borrower has no other cushion to fall back on. and also negative equity constrains lending beyond the

housing market, since small business owners, college students and the elderly often rely on home equity for capital or collateral. and there are also impacts on aggregate demand in the economy and a negative wealth effect. so there's not much question that underwater mortgages are a serious problem and a drag on the economy, so the multitrillion dollar question is what to do about it, which brings us to today's program. we'll be discussing one innovative and controversial proposal for reducing mortgage principal, the use of eminent domain to seize underwater mortgages owned by private investors, write down the principal and then refinance the loans at roughly their current market value. this is an idea that has sparked a quite-heated debate. it's not favored by many mortgage investors, but local governments and consumer groups see it as perhaps a last resort way for finally deleveraging debt and avoiding unnecessary foreclosures. the question for today is whether this is the right policy

to fix the problem. briefly before we get to that, i just want to say that the cap hassing team has grappled -- housing team has grappled with the prop of underwater mortgages for several years. last year we released the plan of reducing principal through shared appreciation, and we've called on the federal housing finance agency to permit services to reduce principal on loans owned by fannie mae and freddie mac. and we have, in the back we have these proposals and other materials we've produced on this subject. also you can find them, certainly, on the c.a.p. web site. so back to today. we've got a terrific panel of experts on both sides of this issue, and i'm looking forward to hearing from them, and let me introduce them briefly. steve gluckstern, raise your hand, steve, steve is the chairman of mortgage resolution partners, a firm that has developed a proposal to reduce

mortgage principal using eminent domain and in discussions with municipal governments across the country. steve co-founded alternative asset management firms as met trust company and capital z partners as well as center reinsurance. congressman brad miller is a recently-retired representative from north carolina's 13th district. during his five terms as the house -- excuse me, during his five terms in the house, congressman miller served as a leading champion for consumers in the fight against predatory mortgage lending and bad servicing practices. tom deutsch, there, is the executive director of the american securitization forum, an association for investors, issuers and other stakeholders in the securities industry that has opposed the call for using eminent domain for mortgages.

previously, tom was an associate at wickersham and taft llt and at mckee nelson llp where he worked on residential mortgage securitizations. jim carr is senior policy fellow at opportunity agenda where his work folkses on housing -- focuses on housing finance and financial services in underserved communities. jim was previously the chief business officer at the national community reinvestment coalition, and before that he served as senior vice president for financial innovation planning and research at the fannie mae foundation. finally, moderating our panel will be c.a.p.'s director of housing finance and policy, julia gordon. prior to joining c.a.p., julia managed the single-family policy team at the federal housing finance agency. she previously served as senior policy council at the center for responsible lending. so take it away, julia. >> thank you, michael.

okay. everybody ready? what we're going to do is we're going to start with questions for the panel and have, try to have a conversation up here. and after a while we will open the floor to questions from the audience as well, so i hope you're thinking about what you would like to ask all of the folks up here, um, and with that, we're just going to start with a general question here. and i'm going to start with mr. gluckstern. where are we in the foreclosure crisis, and in particular as we heard michael discuss, how big of a problem is negative equity and for whom? >> i'll start with the first part, which is where are we. i think a lot of people think that it's behind us, and we're now driving forward. but i would argue it's, in fact, in front of us. mike gave the number, about four million plus or minus american families have lost their homes already, but by almost any measurement,some -- somewhere

between 3 and 8 million more will lose their homes if we don't do something. it's not in the rearview mirror, in fact, it's out in front of us. there's lots of con we think sos, obviously. first and foremost, it's the families themselves who are disrupted and taken from their homes, and it's worth just thinking about these numbers for a second. i mean, we're talking about three or four or five million more families, that's as many as 20 million more americans. why it's a problem, mike also alluded to, when you're underwater, your behavior changes. you don't spend as much money on anything. the only thing you consume more of, by the way, is health care. because under the stress, you find when you look at those numbers, that's the thing that goes up. so the costs are significant both to the family, but i'd argue to society and, obviously, to the communities in which these people live. foreclosures cost both hard dollars and soft dollars. there are property tax issues,

so i say the consequences are felt by all of us. >> mr. miller, do you have anything to add to that? and in particular, what are some road blocks to solutions? >> well, i don't know whether we have hit bottom or not. one of the firm rules of economics is if something cannot go on forever, it will stop. and some of the forces that are pushing down the housing market can't go on forever. we've had new households have not been forming, so people are p continuing to live with -- are continuing to live with three or four roommates or live in their parents' basements, whatever. that can't go on forever, or we'll have some very unhappy families. we or already do. we're going to have to replace the dilapidating housing stock at some point. there are some parts of this that can't go on forever or, but there is still a lot of downward pressure. there are still, i think, ten million more thans who owe more

on their house than their house is worth. that means, as the introduction said, they can't just sell their house if they get into trouble. so we do have a lot of foreclosures in front of us. and the cycle of foreclosures causing equity loss, equity loss causing foreclosures is something we still haven't broken yet. the impediment remains the -- i mean, we've had this kind of problem before. the great depression did not begin the housing market. the bubble there was not housing, but the stock market. but when times are that bad, times are that hard, you're going to have a foreclosure crisis, and they did in the great depression. but one of the new deal agencies, the homeowners loan corporation, was a remarkably successful program. according to arthur schlesinger, historian of that era, it saved the middle class. and they bought foreclosures, excuse me, they bought mortgages

at a deep discount from the portfolios of failed banks -- and there were many of those -- or those were in the days before safety and soundness in accounting, safety and soundness regulation in accounting concerns. and there were plenty of banks who were quite willing to sell mortgages for a bird in the hand. and so they bought, worked for their deep discount which gave them room to negotiate and reduce a principal, and even though they really managed the agency more like social workers than like lenders, when the agency finally closed down in the '50s, it had actually turned a profit. so we know we can make this work. and then the mystery is why it hasn't happened now. the securitization of mortgages, the separation of who owns them and who manages them is probably part of it. the safety and soundness and

accounting concerns about not wanting to realize, not wanting to recognize losses is probably part of it. the honest-to-god incompetence of servicers or because of the way that they're paid, they simply don't have enough resources to do the job is part of it. but there is not -- the people who are affected who are the investors in more or gangs have not been in -- mortgages have not been in a position to cut a deal to limit their losses. >> thank you. mr. deutsch, where do you think we are? is negative equity a problem for the market, or will the problem just take care of itself? >> maybe on the latter question this might be the first or, and maybe it's the only time stephen and i will agree on the panel -- [laughter] is just prefacing what may come forward here. is that i think it is -- i do agree with steven that it has been, negative equity has been a

very significant problem for everybody involved in the process. homeowners, certainly devastating to go from buying a house, putting a down payment down to now owing money on the house even if they were or to sell the house thereafter. certainly for investors who put up money to lend to those individuals through whether that's the securitization process in private label mortgages, and there's about a trillion dollars outstanding in private label, or for the american taxpayer. there's about $5.5 trillion mortgage debt guaranteed by fannie, freddie, or ginny may. and; obviously, if the underlying collateral is worth less than what's owed on the mortgage, it's clearly not having been a positive for helping the money to them -- lending the money to them. there's a tremendous loss to the american economy and to the individuals that have borrowed the money and certainly the folks who lent that money whether that's through the

american taxpayer in the gses, or the pension funds and the like who have bought and own private-label mortgage backed securities. to answer the first question, where are we, that is where i disagree. we're clearly starting to to come out of the storm. just as an example, i think at the opening remarks, san bernardino county was mentioned as one of the areas that you look at as being sort of one of the ground zeros of negative home price appreciation. and what we've seen in san bernandino just evaluating the number of loans in default in that county is that in june 2009 it was about 31,000. june 2010 it was 25,000, june 2011 it's 18,000, june 2012 it's about 12,000. so over the course of the last four years, the percentage point in defaulted loan inventory in that county which is, you know, you could argue is ground zero for negative home price

appreciation has gone down 61%. the mere facts of that signal to me that we're not in the middle, and we're not going into the heat of the storm here. we're starting to come out. it doesn't mean that's going to be, make life any better for the person who's really challenge today make a mortgage payment. doesn't make life easier for somebody who has 150% lte, but it does signal as an economy, as a nation we are moving, i think, away from the center part of it and moving towards areas where i think we've got more home price stability. and even in markets like phoenix, arizona, you've actually seen rapid home price appreciation. it's been 20, 25, 30% year-over-year now through 2012 where you went from a market that was really going down precipitously, and now it's shooting up with that same velocity. >> so, mr. carr, could you talk a little bit about this issue from the neighborhood and municipality point of view? what's really going on on the

ground out there now? >> sure. i actually -- maybic be the bridge builder between -- i can be the bridge builder between stephen and tom and saying we are seeing improvement in all markets. i think the downside is that the damage has been so heavily concentrate inside a handful of states and within those states a handful of communities have been so disproportionately damaged that even though the numbers are looking positive, in fact, in those communities they are still struggling. so the extensive amounts of underwater debt are also contributing to low sales in stores to higher unemployment, unnecessarily so. and for those families that are heading into foreclosure because of a loss of income or because of a lot of the job of one of the owners, if they could, in fact, find relief through principal reduction in order to save their homes, tald seem from a public policy standpoint a positive turn of events and would help to promote and

stimulate that market even faster than the slow recovery it's experiencing, even in the markets like san bernardino county. so i would say that we -- i don't see us heading into an abyss. i think that part is over even in some of the worst markets, but i don't believe we've reached a point where we can say, oh, well, the markets are recovering now, so we can just sort of walk away and let the market do its own thing. the unfortunate part, i think, about this whole conversation is that we're looking at eminent domain which is probably one of the most extreme things that a public entity could do, which is the taking of private property when, in fact, there's so many things that could be done and could have been done that are not nearly as extreme to actually help mitigate the foreclosure crisis. so we look at things like principal reduction through the hamp program. fannie mae and freddie mac are not pursuing principal reduction, yet the dollars are already there. it would be a net positive to the tax pairier -- taxpayers and

help communities to recover. it's not happening. servicers have a hot more flexibility than they pursued in order to modify loans a leader in shared equity principal reduction program, others have not followed their lead. and there is also things like bankruptcy protection. at a federal level, it was debated in congress -- never made it all the way through -- would cost the mesh public nothing. but, in fact, would allow households under financial distress to restructure the debt on their family home and keep it. if you own a luxury yacht, if you own luxury yachts or rental property, you can restructure that debt, but you can't if you are just a moderate to middle income household that has a simple home as your principal asset. so i think the fact that we're actually in this conversation is unfortunate, because many things could happen before we'd have to go to an extreme measure of eminent domain. >> let me suggest, does everyone

agree on the assertion, i certainly do, that principal reduction is, in fact, what has to happen? so let's leave eminent domain until later in the conversation, because it distracts people. but does everybody understand and agree that principal reduction is what we have to provide people who are underwater to once again be able to participate in our economy or not? >> we'll get to it, stephen. i think principal reduction particularly for borrowers who have an ability to meet their mortgage payments, who have shown no sign of distress, who haven't had a life event, a divorce, a loss of job or loss of income, if those are demonstrating an ability to pay their mortgage, has done that through the crisis and are current on the mortgage as your initial plan proposed, i don't think those are appropriate borrowers to go after principal reduction because they haven't signaled an inability or a life event that's going to cause them to go into delinquent request si. >> so we should pun itch them by

the fact that they've been honoring and paying appropriately so when we go through and provide principal reduction, you've been a good guy, so you don't get it. but that bad guy gets it, is that what you're proposing? >> i'm not going to say we're going to put them in the stockade and punish them because they're paying on their mortgages. if they have an ability, they've shown no signs of distress, they have an ability to pay that mortgage. if they lose their job and they have an inability to pay it, every servicer should immediately look to some kind of principal forbearance program for them in that circumstance many in the hopes that that boao get a job, let's say within the next six or nine months, and then resume paying on their mortgage. but to say every borrower who is underwater let's cut away their mortgage principal, i think that's a massive disservice to the $5.5 trillion that went out through fannie and freddie, and also the trillion dollars of outstanding mortgage debt that mutual funds and pension funds

that belong to those borrowers as well. you can't say we should just give away money to these types of borrowers just because they're unfortunate that they've gone underwater. >> i do think it would be useful for folks who may not be familiar to hear a little bit more about your proposal and about the issue just so we get it out on the table, and then we can continue this line of discussion. >> so, the first thing i think it's important for people in the audience to understand is that -- and tom made a good point of this earlier which is america's mortgages are not owned by banks, which is what everyone in the world assumes. banks own mortgages. banks own less than 20% of america's mortgages. the bulk of the balance as tom pointed out are actually insured by freddie and fannie. that only costs us as taxpayers a few hundred billion dollars so far for that guarantee. but there's a segment, a small segment, around 4.7 million loans is the number that are owned by what is called

private-label mortgage securitizations. about 4.7 million, um, borrowers, about a trillion dollars, as tom indicated. and we focus primarily on that segment, the pls eggment, because those -- segment, because the investors in those securities do not have the benefit of the united states guarantee on their performance. they live or die by the fact whether you pay your mortgage or you don't. because of that, those securities, by the way, trade at markets. they do not trade as far. they reflect the fact that there are huge problems in that community. i brought one slide, and right now's a perfect time to put the slide up. so just to frame this, to frame this, so i can see it here, that's okay. um, this is one, an adaptation from one page in fannie mae's third quarter 10q. so this is the united states government's view of the plf

sector. this is with respect to that portion of the bonds that they own. longer discussion of why frank may owns any of these bonds at all, but they do own some of those bonds. and they now tell us what they think about the underlying mortgages. and these are the numbers you want to look at. fannie mae says that there's about $28 billion on their balance sheet, exposure to mortgages, in this sector. they expect a 50% default rate. this isn't before, this is going forward on their existing holdings, 50% default rate. and when it defaults and goes to foreclosure, they expect a 66% loss under that mortgage. half the mortgages, two-thirds of the principal written down. so what it tells you is fannie mae believes that there are roughly two and a quarter million more foreclosures coming just in the plf sector. so in the -- we focus on these

mortgages. by the way, we think that fannie and freddie and the banks have other avenue. many of jim's programs, the hamp, all the kinds of programs for reform and helping these homeowners, most of those programs are not eligible to be used in this sector. pls, homeowner has very few options. our thesis is by allowing these homeowners to write down the mortgages, the principal reduction, we dramatically reduce the number of foreclosures, and we allow that homeowner to stay in their home. the objective of our program is allowing homeowners to stay in their home. so how do you do that? how do you write down the principal? because they're owned by trusts. and we looked around and said, okay, it would be great if we could go to the trustee or the servicer who runs the trust and say, you know, you're going to have 50% of your people defaulting, and you're going to lose two-thirds of your money. and, oh, by the way, your bonds

already trade reflecting that. you've taken that loss already. why don't we allow the homeowner to stay in the house, and you simply write down their mortgage? for a lot of structural reasons that tom knows even better than me, the trustee and servicer can't write those down, cannot. can't sell them. there's a whole bunch of things they can't do. they're stuck in that trust. and it turned out we looked around for what's in way in which we could get that home mortgage taken out of that trust and put in the hands of someone who really has an invested reason to want to keep that homeowner? that's its local community. and we looked around, and we decided the only way you could get that loan out of that trust was using a power that that community's had that was given to it in the constitution of the united states and then handed down through the state constitutions, and that is the power of condemnation. now, i've said this a couple times in jest, i'm not as dumb as i look. if we could have found any other way than using eminent domain,

don't you think we would have come up with that idea? because we understand the controversy associated with taking. and here's what i'll tell you, there is no other way. that's how we got there. and a local community now can condemn that mortgage, take it out of the trust -- by the way, pay the trust fair value. fannie mae will pay you what the fair or value is. they've already done it right here. so the owner of that mortgage gets exactly the fair value in today's market and then reunderwrite it to a new standard. so that's, in essence, the program that we have put forth and we're discussing with some several dozen communities around the united states. >> is there really no other way? >> [inaudible] argues that, steve argues that there is an inability for servicers to write down principal on private label securitized loans. absolutely false. in fact, writing down a

principal -- not just principal forbearance, but actually principal forgiveness -- has been increasing over time on securitized loans. he may be confusing that with gse loans. there is no ability of a servicer of a fannie or freddy loan to actually write down. so there is a very biggies 2006 there. second, he says that we, mrp, can't figure out a way to get these loans out. well, it's because mrp doesn't actually own the loans. what they're proposing at the core of its proposal is mrp wants to take loans from somebody else. that, in essence, is what eminent domain is all about. the person doesn't want to sell you those loans, so you go can and you take them. you grab them without that person's consent. we'll come back to the legal issues involved in that, i'm sure, throughout the discussion here. but sticking to the policy side of it, there is a reason why you can't get out of the trust. and the reason is the united states government, the u.s. department of treasury through

tax law does not allow those loans to be sold out. so when you come back to the legal analysis of figuring out whether mrp's proposal would violate interstate commerce, the very clear answer because the loans are already regulated in this trust. instead it does allow them, though, to be written down within the trust as long as the servicer believes that's in the best interest of the investor. so what they would have you believe is that the servicers, in fact, are not operating on behalf of the best interests of the investors, and it's the investors, these very sophisticated institutional investors are being duped by their servicer not to do the right thing on their loans. i have a very hard time going back to institutional investors who manage trillions of dollars of assets on behalf of pensioners, going back to them and saying, you're irrational, you don't know what you're doing. go tell those servicers to write down massive amounts of principal, that's in your best

interest. if they thought that was in their best interest, they would be doing that. but instead they're telling them, use it with are it's appropriate. if someone loses their job and they have no equity, undertake a program that is put out there or put into effect, actually write down some principal, give them some shared appreciation in those circumstances. but if someone took out a loan, hasn't had any distress sin then and is still -- since then and is still able to pay their mortgage, what is the sense in just saying let's wipe away all that underwater debt because that's better for those individuals. it certainly would be better for those vims, but all the pension money and the institutional money that's been put to it, that would be wiped away. and, in fact, moody's did a great study on in this when mrp's proposal came out and said if you were to implement it nationwide, 30% of the value of outstanding private label mortgage-backed securities would

disappear overnight. since there's $1 trillion of outstanding mortgage-backed securities, that means $300 billion would be lost by pension funds, mutual funds and other funds out in the universe. .. that trustees are not acting in their interests and their interests would be best served if there were reasonable negotiations. now they are certainly concerned about this

proposal but part of that they don't think the trustees can be counted upon to act in their interests in a condemnation proceeding. they won't fight for fair market value. they will throw in the towel because they have nothing to lose. this is a screwed up system. >> is that a technical term? >> that is actually is. i'm not sure if that is a legal or economic term. but if it's true that the constitution is not a suicide pact, mortgage and servicing agreements are pretty much suicide pacts. they do separate out from the investors, the management and the management has a lot of incentives to modify mortgages which would be in the best interests of the investors. you know, when a mortgage is foreclosed upon the losses are 50% of the value of the

mortgage? more? i mean the estimates bounce around, it's obvious that investors would love to see logical reductions of principal so that homeowners who can't pay a mortgage on that house will be in a sustainable mortgage and they don't have to foreclose and it's not happening. now we can argue about why exactly it's not happening but it is clearly not happening. that was the advantage of bankruptcy which were for. i was for. i introduced the bill in the house. that got beaten back in the senate, defeated by the banking interests. and that is the advantage of eminent domain. it is a government power that doesn't worry about who has got what interest and who has got what power. it is just the power to take

something for public purpose, property for a public purpose. take it for a public purpose at fair market value which is lot less than what it is probably being carried on, what it is being shown valued in its books and then modify it and you probably make money. that's this business model actually works. i understand the concerns of investors that their interests will not be represented but something has really got to give. >> so one of the questions that has come up with this proposal is that at least in the primary thrust of it targets homeowners who are paying their mortgage currently. does that concern you at all? do you think that eminent domain should be used for homeowners who are in default or just to cut through for anybody? >> i think a phrase that both lawyers and economists like, it depends. you know i think where we

don't want to be, which tom described earlier and actually steve as well, is in the position of not modifying the mortgages of people who are performing because they haven't shown that they are going to default and then not modifying the mortgages of people who are not performing because you don't want to reward them for their nonperformance. by the time you eliminated performing mortgages and nonperforming, you don't have much left. so i think it probably does need to be tailored to the circumstances. probably specifically whether a homeowner is unable to pay this mortgage and likely to default and lose their home to foreclosure and would they be able to perform on a mortgage for a lesser amount that would be a better deal for the investor than would, then would foreclosure. >> i want to put a slightly different wrinkle on the table and ask you, in the past eminent domain is a

power used in a ways that disadvantage communities of color and is there any concern about whether this is an expansion of the powers of the condemnation and are there any concerns about that? >> sure. so i want to get to that because i believe there are real concerns about the use of eminent domain but i just want to say first of all the idea that the servicers have been acting rationally with respect to loan modifications i want to come back to that for a second. we wouldn't have the 49 states attorney general settlement. we wouldn't have occ just concluding yesterday another multibillion-dollar settlement if in fact the servicers were actually rational, acting in a rational manner. it would be good if they were we would have probably end the foreclosure crisis at least two or three years ago. having said that i believe there are concerns with respect how eminent domain could be used in this circumstance depending how the loans are selected, how the program is designed.

it could be that individuals who actually need the assistance the least, i mean the need the assistance the least, which i think is tom's concern actually get the benefit and those who are struggling don't. i would say at a very minimum a program would need to be designed a program people experiencings higher financial stress so that principal reduction actually allows them to remain homeowners. depending how the homes are selected they could have an adverse consequence in a neighborhood level. they would be homes selected in hispanic and white communities but not in latino and african-american communities. despends on the housing types, et cetera. there are real concerns from my pertech -- perspective how the program is used not necessarily from a race

ethnicity perspective but from housing market perspective the title could be clouded pretty significantly as soon as investors start to sue. my guess is, and tom has not said this there would be a lot of lawsuits initially with the first taking of a disstressed loan. if that occurs, it's questionable whether in fact that loan could actually be, that house could be sold back to its original owner or rather the person who, the entity buys it actually holds it until the legal issues are worked through. i think there are a lot of concerns about this issue. >> eminent domain is one of the most commonly used government powers. there is nothing extreme or unusual about it. we would never build a straight road if we did not have eminent domain powers. there is no way a city could take 10 feet of everybody's front yard so think could have sidewalks in a neighborhood. it is one of the most commonly used powers. everywhere in america right now some municipality is exercising eminent domain to

take something for some public purpose at fair market value and probably everywhere, in every state in the america right now, there is probably a jury deliberating on what fair market value is. this is not, i mean this has been around for a long time. the reason that eminent domain or taking mentioned in the fifth amendment was not to give a power to government but to restrain a power. to make sure when government did take property that government take it for public purpose and for fair compensation, just compensation. there are procedures worked out. we do this all the time really. this is not unusual. if you went to a municipality lawyer, a town attorney and said, we want to do, we want to do a condemnation, he wouldn't scratch his head say, condemnation? i never have heard of that. let me look at the law books. they do it all the time and there are procedures to actually to take it to start to use it and to put to the side, to be determined later

in litigation what the value is. it is called a quick-take proceeding. a term that the lawyers use. we work this stuff out. we have done it a lot. we haven't done it specifically with respect to mortgages but we've done it with all other kind of property. we haven't had a foreclosure crisis like this before that has tempted us to use it for mortgages. >> make a comment. i just want to comment on that because i totally agree, taking easement of 10 feet of property in order to widen a highway that is very different than targeting whole neighborhoods to take whole areas. history of eminent domain is one of the most distressing uses of public power in history as it respects communities of color. the entire infrastructure of urban renewal was based on the inappropriate use of eminent domain. but it's not just in the past. the naacp just testified i believe two years ago to congress about their identification of inappropriate uses of

eminent domain ranging from cities in california all the way to rhode island. and so it is a problem in the past. it has been a problem in the past. it remains a problem today. it just depend on how it's used. so, yes, communities use it all the time. quite appropriately many communities use it inappropriately as well. >> i don't think there is any government power that has not been used unjustly when it comes to race. the homeowners loan corporation which i celebrated earlier is one of the great triumphs of the new deal which is was, was very inequitable in helping white families, helping white homeowners and not helping african-americans. in fact some say that the practice of red lining began with the homeowners loan corporation. that they were the first ones who said we will not modify mortgages in these neighborhoods. so i, we will not be able to take a step further as a nation if we only exercise

government powers that have over the course of our history been used justly as between african-americans and latinos and whites because none have been. we are not talking about taking property here. we're not talking about taking houses to put in an elevated train. or you know, some of the things that robert moses did in new york and long island. we're talking about trying to preserve neighborhoods, trying to take mortgages so they can be reduced so that the person who actually lives in that home can continue to live in that home and that home is not going to sit -- >> the debate really is the assumption will be that the home will be lost to foreclosure. for the last five years, the borrower has paid mortgage. they have been underwater, whether in san bernardino or phoenix or anywhere else and to start the assumption that

foreclosure will happen on that home, that start as debate that just can't be won by the other side because you're assuming what doesn't actually occur if the borrower has the ability to pay it they will continue and yet -- >> you agree somebody who is in a negative equity position is at far higher risk of foreclosure than someone who has equity in their home? >> far higher risk of walking away from their commitments. there is no question about it and that is certainly a risk factor associated with a negative equity home but it doesn't signal in any way, shape or form, that that borrower has lost the ability to pay a mortgage. doesn't show they have lost their job. doesn't show they have lost a spouse. doesn't show they have reduced their hours. all it shows is that they are simply in negative equity. that may be 10%. that may be 50%. >> but that means if that borrower has some kind of a negative income event in their life they lose their job, they have a health crisis, there's death, divorce, disability happens,

they have nothing to follow back on. they can not sell that home. they can not borrow against that home. >> and that, i think that is precisely when the servicer has to step in and engage in appropriate loan modification or loss mitigation. but if a borrower loses a $200,000 job and their best opportunity for getting another job is 50,000, just as an example, likely a situation where home retention may not be an option for that borrower. >> is this working? i only have 100 things to comment on. [laughter] but i'm going to just pick three and the premise, the starting premise what has been characterized as mrp's program is not mrp's program. these are programs developed by cities to protect their communities for which we as an advisor work with them. so it's very convenient for tom to call it but i make three general comments.

there is so much we can talk about. the first is question of communities of color. anyone who thinks that this is not disproportionately affecting communities of color is just kidding themselves. in fact we managed to more or less wipe out all latino wealth in this country through this crisis. so the, some assumption of concern about eminent domain, for sure has been historically. in this case the housing crisis has leveraged against our communities of color. that's number one, on that topic. i have a lot i can say about tom's analysis which is flawed in many, many ways but we'll pick the one example he wanted to quote. moody's that very reputable organization that rated all of these bonds aaa through the cycle, including when the cycle was crashing by the way, with a statement that if you adopted a program that mrp recommended we would see a, i think he quoted 300 million there. just use lodgic for a second.

our program calls on communities to pay the value of an underlying mortgage at fair value. so if you pay fair value for something being carried by the way at fair value, the notion there is $300 billion loss is absurd. very convenient. has a lot of headline benefits. it is just flat-out wrong and moody's has been flat-out wrong, manyings many times. last thing i want to say, i think it is very, i don't want to pick a fight particularly but maybe i do. >> go right ahead. >> this crisis was more or less brought on by tom and his colleagues. that is really what happened, not tom personly. not individually but that factory that created securitization. and by the way, i just want to make a comment now. they benefit by the continuing excess payments by homeowners who are underwater who continue to make payments on mortgages

because, whether they morally think they should do it or for whatever the reason, that is transfer of wealth by the way from individuals who are under pressure and underwater, to the investment community. it is inappropriate give the nature of it. but most importantly, people want to take a quick look what is happening to foreclosed home and look to the largest buyer of foreclosed home is becoming. it is not that first-time homebuyer who wants to get back into the market. it is in factual street, tom and tom's colleagues, who are now buying, maybe you're buying them, i don't know, who are now buying these homes so exactly two things happen. one is, we're turning ownership communities into tenancy communities. we know what happens where there are transient communities, property values go down. more importantly when the recovery comes, and it will, that benefit will rise not to the existing homeowners who have been thrown out but in fact to wall street in the aggregate. i have 50 others. i will stop with those three

things. >> let's give tom a chance. >> now that the curtain and has been drawn back and truly see i'm the wizard behind the curtain manipulating a $12 trillion outstanding mortgage market, i'm a little a bashed to say it is me. first couple things. question of legality for eminent domain and what mrp is proposing. steven says it is developed by the cities. not a single city has developed eminent domain program. what you hear from san bernardino proposing a program, entirely devised by mrp. in fact they helped construct what is called a joint powers authority out in san bernardino county. why do you have a joint powers authority? why does a county create a legal construction? and a simple answer is because they need to create a special purpose vehicle. follow with me here. i'm in my world of securitization here. the county of san bernardino,

if they start to seizing mortgages as the congressman indicated through this quote, unquote, quick take, what that means is, they take the mortgage and they decide how much to pay later. that seems very convenient if you go with mrp's analysis when you take it you are only paying 7 to 80% of the appraised value of the home. mrp builds this foreclosure discount for borrowers who are still current on their mortgage. so follow with me just a little bit longer here. so the joint powers authority, a separately legal entity is taking these mortgages at 70 to 80% of their value but not putting up the money they're taking mortgages saying we'll pay you later. then mrp, through their program, a private investment fund, will then refinance those mortgages through fha. >> well we -- >> i need to finish where i'm getting to is that through that quick take program, if it is determined later it wasn't fair market

value, the joint powers authority can be bankrupted and no one wins in that situation but institutional investors, pension funds and mutual funds who doesn't get fair market value, now all of sudden have their mortgages ripped off. >> hang on. >> i didn't practice at at taft. i'm a small town lawyer and i actually tried a quick take proceeding. a quick take condemn nation and in fact the condemning authority deposits with the court, usually after they tried to negotiate with the property owner unsuccess fully, they deposit what they think the value is worth and they take it. the property owner can take that money and can still contest the valuation and get paid more. now if they lose the valuation they might have to pay something back but they, if the condemning authority

does have to pay something into the court to the property owner to take, to take the property. all right. i'll -- >> just a few things. first at the risk of giving tom a heart attack i'm going to agree with several of the things he said. he may not be able to go back to his office once i get through. but, i do want to start with going to the point that steven is making. i do believe that there is real potential in this proposal of eminent domain, i will come back to the part where i agree with tom but i think there is real potential there. i think the potential goes beyond the individual loans that might be purchased. what it goes into the servicers and the investors recognizing that if they don't make decisions to better modify loans, that someone may take the decision from them. and i think that would be much more powerful than the number of loans are actually purchased. just the fact that a community has stepped up to the plate to do that the one thing i have to say a little bit of a pushback to steven

and agree with tom, if we pretend or assume, not pretend, if we assume there can't be negative implications across race ethnicity simply because a program is in place and a particular set of households are in more distress, they are going to get more help, i think that is not a reasonable assumption the fact that african-americans and latinos need something more does not mean when the program is designed it will benefit them more and an example in this program what i've seen so far is that the borrowers have to be current in their mortgages. well one might expect that within african-american and latino communities, in fact a more disproportionate share of households may be behind in their mortgages because they're more disproportionately affected by unemployment or loss of income. there on the surface we would poe pongs -- potentially given to individuals who need it from a public policy standpoint but who are not immediately in distress and not giving that support to the

households that actually need it base they're in financial disses stress. that alone to me that the program deserves a second look. my point i agree and i think there is real poe topgs in the -- potential in the eminent domain purpose in this particular case but i think if we walk into it assuming that the households that need it most are going to benefit the most then we could have every sort and manner of unfair and unequal outcome. the final thing, what i agree with tom with as well, like i said, tom, you won't be able to go back to your office, is the fact that you could have whole neighborhoods targeted which the house prices are really substantially upside down. there is a two steps to this process. the first step is the loan is purchased. the second step it is sold back to the original owner. what guaranties that loan actually will be sold back to the original owner? it is another way of saying what are the standards or the criteria, the underwriting criteria for that person to buy their home back. so if it turns out for some reason people of color -- >> we want to clarify. >> okay.

>> to clarify, no home is bought, no loan is sold back. one of the problems that we have is everyone assumes they know everything about what the program is. i don't know because here's what i will say this again. we work with communities to design programs that fit their needs. that address the issues of, is this current homeowners, is it delinquent homeowners? is it all homeowners? is it some homeowners? what do you want to do? you want people to prequalify, qualify afterwards? there are 100 aspects. what we believe we're doing, we'll lay out to you all the options that you have and you as a community to make sure some of these very issues get dealt with, figure out how do you bring this out to the community and how do you address those various issues to eliminate many of the kind of pitfalls there. this is not a one-size-fits-all. this is in fact individually designed by those communities. by the way, this won't surprise you, the communities we're most furtherest on in these conversations are the most

heavily minority communities in this country. that is, that's the lodgic of the conversation. >> i will make this quick. a quick point how bad foreclosure crisis and collapse of home values have been for communities of color. there are lots of studies on the loss of net worth. household net worth and responsible lending. you know them. they have done one published within the last couple of weeks. there was a nyu economics study within the last couple weeks. a lot of the lot of loss of value is actually in the neighborhood where there are foreclosures. it's having a home on your block or the next block, that is boarded up and weeds are growing. there is foreclosures flooding home, housing markets generally but specifically a great deal of that, of those loss of value has been because of foreclosures in neighborhoods. that has affected

african-american and latino neighborhoods disproportionately by an enormous margin. the nyu study found that 46, the median household have lost 46% of their net worth, their life savings in the housing crisis in the last five years. that's a stunning number. it takes us down to the lowest number that has been since 1969. we are really a different nation now than we were five years ago. because of the loss of, the there has been a lot of discussion about income inequality. inequality in wealth is worse. than income inequality. and it is disproportionate, the losses are much greater in african-american communities and latino communities but in low income neighborhoods where people did own their homes, but there have been many foreclosures, the average net, loss of net household worth has been 91%.

>> i agree with both jim and congressman miller. i agree with both jim and congressman miller, that we do need to target the borrowers in need. that's the key point of all of this debate. find the borrowers who have a challenge paying their mortgages and address that. don't come up with a program that instead addresses the folks who are not having difficulty paying their mortgage. if the current has been drawn back on me as the grand maestro of the mortgage market, let me pull the curtain back a little bit on what steve is saying about the mrp program designed to meet the needs of the community. if that was true, mrp in my opinion should be registered as a not-for-profit institution. but instead they aren't. they are registered with the securities & exchange commission as a private pool investment fund. their incentive and profit motive is to make money. that is not necessarily congruent with designing a

program to meet the needs of the community. which is why their program has been designed to actually take borrowers who are current in their loans. of course, those are the most valuable loans. they're the cherry-picking of the loans. borrowers who can pay their mortgage. could find the borrower who has the highest fico score, can pay their mortgage but because they're underwater, we'll use government power to take the mortgages away from investors who value them appropriately, refinance them, redo them and then all of a sudden now you have a very profitable loan. mrp in their own program documents proposed to sell back to fha, fha to make a significant profit what they promise the their investors is 20 to 30% returns. if their program works, and they're paying fair market value, how do they pay their investors 20 to 30% returns? >> just to get, circle back, you know, whether mrp makes money or is a nonprofit,

there are 30 some municipalities looking at doing some version of this right now. this is a -- these municipalities are hurting and they haven't been getting help. how would you help them? would you, i'm just curious because i have wanted to ask this publicly. would you support changing the bankruptcy code to permit cram-downs? just a second. if you say no to everything. >> i proposed doing this, there were actually a lot of proposals to do this. law review articles which nobody reads. >> for good reason. >> howard jackson, who is a law professor at harvard wrote a piece, an op-ed in "christian science monitor" in december of 2008 or so. ncrc proposed doing this with federal fund through a federal agency. and i wrote an article in "the new republic" in lar of

2010 suggesting treasury could use tarp fund and act exactly as the homeowners loan corporation had done, do this not for a profit but specifically to help homeowners. american securitization forum wasn't for that either. >> i just, real quick point on just clarify my position. i'm not opposed to the in concept the use of eminent domain for borrowers who are upside-down, who are current. i'm simply saying that the priority would be in my view for those who are already experiencing financial distress. when you get to the point of they're current, i think other tests could be put in place. that's why i think there needs to be a lot more detail on the table before there's a vote of yes or no. for example, if you're paying 70% of the your income to keep that mortgage current, do you want to force that homeowner to actually go into default before they actually get help and wreck their credit score and in the process of

doing that, can't buy clothes, can't buy food, can't buy et cetera, et cetera? so i think that there are parameters that could be in place that prioritize in need and in need to me is not just a cuttoff between i'm paying today, i'm not paying yesterday. >> okay. >> can i just, since the curtain keeps coming back. i just want to say one or two things to make sure people have the facts in front of them, that's all. mrp is a for-profit institution. i make no apologies for that. i'm an entrepreneur. been my whole career. that is how the deal is. that is how problems get solved by american entrepreneurship, how you solve problems. second of all we're not a pool of capital. we're a fee. we charge a community $4500 if we successfully help them keep their homeowner in their home. we have all of our costs associated, now $4500 that is funny number. where did we get that number

from? did we pick it out of the air? we looked around and turns out our federal government will pay that to servicer to modify loan who has no risk. we picked that number. the federal government already done that. that is the deal. we'll charge 4500 for successfully resolved homeowner who stays in their home. that is who we are to make sure. investors, your investors, there's a activity that has to take place. you have to basically if a community it going it come den a loan it has to pay for the loan. unlike your characterization of quick take get it for nothing, which the congressman corrected not exactly true. you have to put up money in advance. turns out we have to raise that money. by the way, surprise we're raising it from wall street. where else would you get the money? from people may be member of asf for all i know the group of people who are there. they need to be given return on that which they basically judge by the risk they're taking. we don't promise them anything. we say this is the program. we node to have your capital

to be able to exercise this. what return will it require to get you to lend us the money? lend the community the money? that is where it comes from. so just we have the facts what happens here, i don't mind being accused of being capitalist. i'm a proud capitalist, but not something like bad about. >> i can't abrief we'll start and end this with a agreeing with each other. i will give myself a heart attack. for people to put up capital they have to agree to get appropriate return. if you change the rules and go in after they put up the capital, you know what? even though we never historically in the history of this country gone through any kind of this program to take individual mortgages we'll take it at what the court thinks is fair market value which at least from your proposals every institutional investor will disagree that i'm aware of. we're going to take that money away from them and we'll decide what is best for it. we're going to decide where we think and what should happen with those mortgages.

and in the process what we're going to do, as we start to get to a more fundamental debate what to do with fannie and freddie we're currently guaranteeing 90 plus percent and fha, 90 plus percent of every mortgage made in america we'll not get the taxpayer off the hook of guaranteeing those mortgages because institutional investors will say, the government just came in and took the mortgages we don't think are fair market value but now you're asking me to put up more capital from these pension funds to originate more mortgages. seems illogical that we'll find a way to get out of the housing crisis to create more lending for first-time home buyers we're doing the exact wrong things it scare investors away. >> make one last, i just can't resist. because i want to make this pricing argument. like there is some mystery between what these mortgages would be. and we'll agree what fair market value is. . .

>> and please identify yourself. >> my name is phil reagan. i'm an organizer with the union. in response to come we can change the rules. i like to point you all changed the rules, look the economy. you came to us to bail you out. we bailed you out to save the economy. but you just kept going on like always. and not keeping up your part. we bailed you out, not to bail

you out but to save lots of homeowners. i find hard to believe we can change the rules. you already rewrote the playbook completely. i would like to change them although that could benefit us. survey that is problematic but i don't buy the. i think we need to. there's issues and a lot of places and less we do that nothing will happen for us. and she. >> questions? >> william. question for tom, and others on the panel. the impact potential on fha. i'd like you to expand a little bit about that, but also the long-term consequences on the security part. >> i think maybe two issues. the first, what i think deed and the crew has focus on going after private label mortgage-backed securities. what should be -- what would happen if they go after fha

loans? fha loans are, most of them are originated around 3% down payment. more or less. two to 3% down payment. so when you talk about underwater mortgages, the number one thing to be focused on is -- who has a big pile of underwater mortgages of fha. so if you are saying we can use eminent domain to go after private-label mortgages, should also be set to go after fannie and freddie loans at fha loans? that's what taxpayers have to focus on. second as i think your second question here is, what would be the long-term implications to the security of market? try telling a chinese investor who wants to put a lot of capital in united states right now, let's put money in u.s. residential real estate. now, pile on that lots of news characterizations of the united states government coming in and taking mortgages, taking their property and fixing them so that

the folks can design to the community needs rather than the person who put the capital. that a serious long-term destruction to the mortgage credit market. but again, you go back to figure out how do we fix fannie and freddie and the gse problem in the united states. it simply makes that much more impossible than it already is. >> the argument that at some point in the future we may do this again, we have never done this in the past and now we've set the president will do it again. makes no sense at all to me. the reason we've never done this in the past is that we have never had foreclosure crisis like this. and i don't think there's a whole lot of temptation for municipalities to do this absent of foreclosure prices. why would you do this, and whether she really had a problem with declining home values in a cycle of foreclosures and declined values and negative equity, on and on. that's like someone in the emergency room setting i didn't

want to use a differently because i thought in a few months he would come back and say you -- can you shoot my chest again? it's now an incentive to do it unless we have circumstances like the ones that we have got. >> you made a couple of comments but just one last thing about this, oh, we should look elsewhere. it's not even clear you could use eminent domain to loans that had fha guaranteed under fannie or freddie because those might be federal properties. it turned at a local community couldn't do it. so the sort of threat, this debate, what would happen, if a community even chose to do so, which i'm not sure why they would, it would even be legal. so that is sort of what i described as a scare tactic but what about everybody else. >> i agree with you. the issue is for local communities to take federal property.

you are indicating potentially illegal. i 100% agree with you. private-label securities, 10% of them are owned by fannie and freddie with fhfa is a conservative for fannie and freddie. but you start taking loans to private security, then taking federal government property, the fhfa is probably already indicated they are very concerned about this and potentially meant to step and legally if you start taking federal property and interfere with their conservatorship pow power. [inaudible] >> i don't think it's all or nothing. the fact of the matter is, they develop a net present value calculations has been run off throughout the foreclosure crisis. if, in fact, the loans that are identified under the eminent domain program are those that show a net present value that's beneficial to the investor and homeowner, and those with a loans, the only ones that were collected for the program, and that could be explained in investor in fact you're not losing money, you're gaining money. once again go back to those lawsuits that say this is what

happened when you willy-nilly shouldn't be doing which you are doing. you end up with a lot of losses. i believe there are ways in which the program could work in which the securities market would not be impacted at all and investors here or around the world would say oh, net present value, i understand that come it makes sense. the challenge again i say goes into the details of how the program is structured. >> we have more questions here. >> [inaudible] >> my compliments to c.a.p. and julie for putting together this panel. just one statement before ask my question. there are many investors including ami numbers that only acknowledge the problem but also support a proxy cramdown shared appreciation, other solutions for borrowers. but i want to direct my question to some of the panelists and i was surprised by some of the comments. can you reiterate how something like this proposal impacts unions, seniors, and you know,

what are some of the unforeseen consequences, maybe they are foreseeable? what sounds like tempting worthwhile program but maybe need to be better understood by communities before they proceed because while we are helping a few, there's an impact on many americans. >> yeah, i think that was really an outstanding question because you put your finger on the issue of seniors. and seniors to me represent the population that could potentially benefit from this program. in fact, the current in their mortgage but it makes no sense if they're already 70 years old and they have the possibility of never paying off the loan. so adjusting the principle might be a reasonable thing to do. again, i see the details are really to me where the eminent domain conversation should be. >> i think chris's question about seniors and unions is because they have an interest as

homeowners potentially in trouble but also the pension holders or, pension funds, so steven and tom, if you want to -- >> stephen put a thought earlier at the securitization process. describe securitization at the simplest point is older americans, let's call them retiring police officers. they have pension money through their 401(k)s, through their pension money. that money gets invested somewhere. usually through mortgage-backed securities. when you buy a mortgage-backed security you allow a lender than to take that money and lend it to someone else. at first-time homebuyers who is a buyer. effectively are taking money from lending from elder communities, of people who are out of savings annually the ultimate to people who want to buy a house. the problem with the eminent domain proposal is you're effectively saying for those who put money out there, who have led to this money to the pension

fund, through their 401(k)s and their mutual funds, you are saying i want to help that homeowner and i'm going to do it at the expense of these pension funds. and i think is fundamentally wrong, particularly when you use the power of the government. >> if i might, a slightly different interpretation. first of all, many of these union members are, in fact, the very people who find themselves under water. that's who it really is in many cases. so we used the example, i'm with tom, so the pension funds, by the way, that pension fund, they have to maximize the value but they also think about constituents. and so now the situation where we have a devastating problem, holding back or economic recovery, holding back the development of construction jobs with that particular union, if you want, and now you have a kenyan did this as we're willing to pay fair value for these mortgages. by the way, you own a bond that's the part of a trust

that's got 100 mortgages and maybe there's one or two, we will pay fair value as determined by the government for it. that allows us to keep that union member in their home, to renegotiate with. that's the effect of this. that's why in fact that pension fund, union pension fund, my opinion, should be enthusiastic about this and should tell their bond managers, this is good, good for america, good for my constituents and it's even good for my return. >> i was going to say real quickly from the perspective of the investor side again, if you're using net present value then fact it's a net positive. >> it's true mortgage investors have allies on a lot of issues, which is why greece see so much. but i think that working families, benefit in a couple ways in that their homeowners

and the collapse of home values is affecting their net worth, it's affecting their life savings. and then in a dramatic way as we discussed earlier. second, they care about jobs. they are effected by the jobs crisis, and a big job crisis has been the effect on consumer demand from the loss of net worth. and then finally, as the union pension funds, if they have pay fair market value, it is not hurting them. that's what fair market value means. it means they are getting, they are selling something or they're having a forced sale of something but they're getting paid what it's worth. it should not hurt pension fund. i understand the concern that investors don't think they can count on, with some justification, don't think they can count on trustees and services to protect their interest, and to advocate for fair market value with

enthusiasm at the local level when it is jonathan when it is a condemnation. and it's coming out of their portfolio anyway here they don't care. the money goes straight to the investors. they don't care. and they throw in the towel quickly. i understand that pension. i'm not exactly sure how to fix it, but i would encourage steve and the other groups like you that are considering this and, in fact, some of them are pretty far along, he is lucky that his is not the only proposal like this, that they work with you to try to make sure that there is some way to reassure you that you are getting paid fair market value for the mortgages that are taken from the securitization, the pools. >> let me see if i'm given allen on the panel, tried to anyway. harleys have a heart attack. jim, do you think it's appropriate for investors to believe that the government, given history use of eminent

domain in america, that investors should be -- and courts will get fair market value right for hundreds of billions of dollars of outstanding security? >> that's an easy one. of course, not. you know, i think the reality is relevant to the detail of how the program is designed. my concern is that, and steven has alluded to this on several occasions, you don't really understand. you don't really understand how the program is designed. but to me that's not my problem. that's the problem. the program design is where the rubber meets the road. and if it's done and way in which you can be demonstrated that the only loans that are eligible for purchase by the municipality are those that show a net present to investor and homeowner. to me, that's a very different conversation that leaves the door open where an individual is upside down and there is no

other parameter that they are underwater. >> want to get a couple of the question. >> fair market value is such a common, legal concept in every corner of america right now. juries are deliberating over fair market value. they are our pattern jury instructions. there are ways to prove it. there are comparable sales. there is valuation based upon income that it produces. this is not some strange concept. >> if you take the numbers that stephen put up your speedy you wouldn't have to take them. you've got an economist that says this is our decoration and why, i'm sure it would be admissible. by the other side, cross examined the economist can produce, call their own economist and produce evidence of comparable sales and income and everything else when it goes into proving value to what

steven has done is take these numbers, this is what the government tells you is the real valley of these mortgages. he's showing the third quarter from 2012. look at the price of outstanding private-label securities. they have appreciated approximate 20% in that period of time. stephen want you to pay this number, yet it's appreciated 20% since then. does that sound like a good deal? >> we're going to move on. >> excellent argument for the jury. [talking over each other] >> thank you. i'm going to take it from a different perspective as a renter, because i think you're overlooking a major group of folks. i don't have a pension, so i think as you look at major cities and alexandria were i live, there's more to alexandria in old town, as the housing crisis, which developed because mortgages were given to people

who could not afford to buy homes or keep their mortgages have erupted now. affordable housing is an issue for all these towns that want to redevelop. eminent domain is kind of scary. so, are you saying, one, my first question is, i think freddie and fannie need to go away. two, if, will you have to change the guidelines for eminent domain from, we are taking like rhode island, the development with that lady's house, are you going to change the guidelines and say, we will take your homes because you can't afford a mortgage, to redevelop another community, or eminent domain which is for traffic and roads and stuff like that, they will change the law so that eminent domain, number one, because they did try it in alexandria, to stop a restaurant from having an alley taken away so they could

put the table outside. and, two, how are you addressing the loss or are we announcing everybody has to be a homeowner? or is the government and the people saying, you know what, it's okay to be a richer, because renting is in and we're not talking about that at all. thank you. >> so, if no one else wants to respond, let me just say it was a piece of that that it wanted to speak to, because you got is something i was alluding to earlier, and so allow me to come back. and that is if, in fact, the program doesn't require that the owner, the previous owner has the right to buy that home back, those properties, those loans could be purchased and those homeowners out of their home. that was the concert i was raising. that was the concern i was raising. i thought i got your point about what if the government used its

authority to buy those loans to say that my definition of this program, you are upside down by x percent, therefore you can't afford the loan, but we purchased it and now we're going to use your property for other purpose. >> to save steve the trouble, for the most part these proposals as far as i know them, are not taking the home. they're taking the mortgage. so the person who is a homeowner is still home owner, still owns the mortgage, just to a different person. >> okay, go ahead. >> is that accurate? >> i think all of the proposals have been to condemn, to take eminent domain, mortgages on owner occupied homes. and targeted where the owner really wants someone to buy the mortgage and negotiate with them. so i think the idea of, like the thibault case come the case i think you referred to. i don't really think that has a lot to do with the circumstanc

circumstances. [inaudible] >> know, the law is established, laws are in place in every state. yes, they are. combinations taking place everywhere, in all manners of property, including leasehold interests. what is fair market value have to do with this establishment in every case, it's in the constitution in the fifth minute. just compensation. >> okay, i'm going to try to get in one more audience question before our time runs out. in the back. >> i'm greg squires of george washington university. the panel began by acknowledging that housing market was coming back at it. in many commute across the country. i'm wondering if anyone on the panel has a sense as to what extent does this come back reflect justification that is simply displace a lot of low income people, perhaps for reasons that have almost nothing

to do with the foreclosure crisis or job loss but so what because of appreciated property values in their neighborhood? >> i don't think -- i think from your question you and i are probably sympathetic political views, but i'm not sure that's what's happening right now. first of all i'm not entirely convinced we don't have a little of the false. to the extent it's slowing, the fall is flowing i think it's because as i said earlier, that ironclad rule of economics, something can't go on forever, it will stop. and home values have been falling for so long for so far that at some point it's going to stop. but there's been already an enormous amount of damage. there's still a lot of downward pressure. they're still a lot of foreclosures in front of us. a lot of the housing market is a move upmarket the people who own a house under by a bigger house and the use the equity they built up, they don't have equity to use for a down payment for a bigger house. i think the still a lot of downward pressure.

it's certain not going to come roaring back. it may not be -- we've had five years now of housing starts being about a third of the natural demand that we have seen for 15 years. before the bubble. you know, there was some excess we had to burn off. we have to absorb from the bubble but we are way past that now. and it comes from new household formation. it comes from second homes to some extent, and it comes from replacing dilapidated houses. i think that's the reason that it slows down more than anything else spent i'm told we can take another, last question. >> thanks. my name is john. i'm one of stephen's partners. congressman miller, put the challenge down, and that challenge is for mrp to sit down with your organization and talk price. so, tom, my question to you is, when she would come sit down with your organization and talk

price? >> know, we've had a few sit downs. i think we could probably sell tickets to the sit downs. >> probably make a lot of money. [talking over each other] >> you want to use the room and we will put on the website? >> i want to take one more actual audience question. this person on the fourth row why can't see. >> thank you. dan from the mortgage bankers association. you mentioned earlier you were working with these communities develop a solution here that makes them a amount of sense for the community spirit my question for you is the plan to extend that to a level of working with the political leadership in these communities to develop tailored up racial and valuation methodologies that make the most amount of sense for these communities, individually? thank you. >> no. no is the answer not tailored a

valuation. i defer to what the congressman said. the law specifies exactly what you do with eminent domain. you basically use either comparables or other kind of recognize -- the valuation or and i know is that all our time on that today to me is not that -- but john was in a facetious when he said tom, when is the time to sit down. if you think about it if we agreed a price, if we agreed a price all of us in a lot of this goes away. investors -- which is what we contend, in fact this can make an enormous difference. we can run this through in a lot of ways. so the answer is not customized valuation. get the best estimate of fair market value, but they're not customized solution. >> i wasn't kidding about selling the tickets part. and a norma's opportunity there. i think the key question and the key differential that we have here in terms of the green for the price, with eminent domain brings to the debate is

involuntary. power of the government to take more institutional investors to steal mortgages at a below the market value price. >> mr. miller and mr. gore, last word. >> this is not, i've said this before. this is not an unusually, an unusual government -- is probably the most commonly use government power. there are lots of procedures developed over centuries. they are archery trials happening in every form of america right now determining fair market value, determining -- property damage cases, property cases, and on and on. this is not all that unusual. i think the reason for so much consternation by the mortgage investors is that securitization is so, to use a technical term used before, screwed up, that they can't trust anyone to

protect their interest. but if they're getting paid fair market value, what a willing seller would agree to sell it to a willing buyer, that's the legal standard, then i don't think they would be much of a problem. but their concern is that the servicers, the trustees will not protect their interest and will throw in the towel, and i think if we can get past that, that can have some justice behind the. i think it would be a way to begin to get control of the cycle of foreclosure and declining home values that we still have not worked through. >> i would just say that -- times demand desperate responses. the reality of is that even though the market is stabilizing generally, many communities across the country are hamstrung and harmed by extraordinary amounts of upside down debt. i think that this eminent domain

proposal is a viable and. i figure should be considered. i think it should be discussed, and i think it's a probably decide it could have a huge impact on the market, but i would caution that while it is used in communities across the country on an everyday basis, there are abuses of eminent domain right across the country in communities across the country on an ongoing and daily basis. and so it has to be very clearly design, very well monitored. but if done properly this could be an extraordinary opportunity for the housing market, particularly in those communities that are most distressed. >> well, thank you. before close i want to my everybody to our materials in the back. i think they will be folks from mrp and about, probably some various investor groups and maybe the mba as well. so choose who you want to talk to. on february 1 we will be having our next housing panel on the question of down payments.

so that, we will start looking at the first-time homebuyers and what's really going on out there. i want to thank the panelists who were fantastic. this was very fun. i hope it was as fun for everybody else as it was for me. we hope to have you back here soon, and thank you all for coming. [applause] [inaudible conversations] >> join us and about a half hour when will have a look at changing marijuana laws. the focus will be on the legalization in colorado and washington, now the federal government will respond. that's from the brookings institution and it is live here on c-span2.

>> also we have live coverage of new jersey governor chris christie and a state of the state address. that's also a that's also at that's also at 2 p.m. eastern on our companion network, c-span. >> you are watching c-span2 with politics and public affairs. weekdays feature live coverage of the u.s. senate. on weeknights watch key public policy events. every weekend the latest nonfiction authors and books on booktv. you can see past programs and get our schedules at our website, and you can join in on the conversation on social media sites. >> british prime minister david cameron and deputy prime ministers nick clegg held their first joint news conference of the year, monday come in london, outlined the coalitions governments midterm priorities on the british economy, the leaders stated the economy was healing at a much slower pace than expected, but they added they were confident the coalition had a plan in place to promote growth.

>> to come together in a national interest and for the first coalition government in britain for over 65 years. we were faced with a national economy in difficulty, with our nation's finances in debt and disarray after years of mismanagement and neglect. this was always going to involve tough decisions, and some people thought our coalition wouldn't make it through our first christmas. but this government is now well into its third year. because this coalition was not and is not some short-term arrangement, it is a serious five-year commitment to give our country the strong, stable and determined leadership that we need for the long term. at the heart of that commitment is one simple fact, britain is in a global race. and that means an hour of reckoning for countries like ours. some countries will sink, others will swim. and for britain to be a success, we need to take the tough

decisions that will enable us to compete and thrive. we need to fix the nation's finances by dealing with our debts. we need to rebalance and rebuild our economy, and we need to back the aspiration of hard-working families and businesses who want to get on and do the right thing. the challenges are great, and there is still a long way to go but we are on the right track, and we are making progress. in just two and a half years, we've cut the deficit by a quarter and set out a credible path towards our goal of a balanced budget. the economy is rebalancing. there are over a million new private-sector jobs. in the first two and a half years of this government, exports of uk goods to both india and brazil went up by over a third, and exports of goods to china went up by almost a half. last year, britain became a net exporter of cars for the first time since 1976. we've cut income tax for 25 million taxpayers, we've halved it for those working full-time

on the minimum wage, and we've taken over two million of the lowest paid people out of income tax altogether. we've introduced a benefits cap. we've delivered the biggest ever cash rise in the basic state pension. and we've guaranteed real-terms increases in the nhs budget, with more of that money reaching the frontline. compared with 2010, there are over 5,000 more doctors working in our nhs, and there are 6,500 fewer managers. we've not baulked at the tough decisions necessary to secure our future. instead, we've ended the chronic short-termism that has too often let down our politics in the past and seen far too many previous governments just leave vital issues in the pending tray marked too difficult. so we've broken the monopoly of state education with free schools providing excellent education free to parents who send their children there. we've also established 2,000 academy schools. we've stopped dumbing down. we've introduced tough new powers on discipline in the classroom.

there's a whole set of issues that are subject to this long-term reform from this government, issues like putting our universities on a sustainable footing so they can compete with the very best in the world and give everyone a chance to go to them irrespective of their background or income, modernizing our energy and transport infrastructure so we can keep up with our competitors in the global race, regulating our banks properly, so that immoral behavior and the gross mistakes of the past are not repeated. we're dealing with the challenges of an ageing population. we've reformed public-sector pensions so they are both affordable and fair for both public-sector workers and the taxpayer. in every case, we've put the national interest at the heart of this government and put this country on a path to being a winner in the global race. now, today is all about taking stock of the progress we've made and setting out some of the next steps that we want to take. now, of course there have been difficulties along the way. with public finances as broken as ours, that was, i think,

inevitable. but i think we've made a lot of progress, and today we're publishing a document which shows what we've done and what we still have to do. and between now and the budget, we'll be setting out an additional set of reforms that go even further in taking the long-term decisions that are necessary to put us on the side of hardworking people, to create a bigger and stronger society, and to help britain win in that global race. these reforms will include the following, new investment to provide more help to working families to cut the cost of childcare, more help for families who could afford a mortgage but are unable to raise a large deposit so they can buy their own homes, and new measures to limit state powers and extend personal freedoms. we'll also set out big new steps on some of the hardest and most important long-term issues that will shape the future for generations to come. on pensions, clarifying incentives to save and restoring dignity in retirement by tackling poverty in old age without relying on pernicious

means-testing. on social care, capping the potentially huge costs of long-term care faced by many families today, so that people can have the certainty to plan for their long-term needs. and on modernizing our transport infrastructure, consulting on how to get private investment into our motorway and key trunk roads network, and extending high speed 2 from birmingham to the north to create a rail service that joins london to the northern cities in just under two hours, with the aim of bringing the journey from scotland to london down to under three hours. all of these are yet more examples of a coalition and a government that is determined to fix the long-term problems that hold our country back. now, of course, the road ahead won't be easy. there have always been issues on which we disagree, and doubtless there will be some more in the months ahead. but the key point is not whether you have disagreements, it is how you handle them. where we disagree, we should do so and we do do so respectfully, in a reasonable and civilized way.

more importantly, nick and i are completely united on the big issues that brought our two parties together in the national interest, and which remain this government's sheet anchor today, on cutting the deficit and building a stronger, more balanced economy, on putting responsibility back at the heart of our welfare and education systems, on backing aspiration, getting behind the hardworking and people and businesses that will enable our country to succeed in the global race. government is at its strongest when making these big arguments, and on all of these issues, our resolve and our sense of shared purpose, if anything, have got stronger over these last two and half years. so over the next two and a half years, it will as far as we are concerned be full steam ahead as we continue to put political partisanship to one side and do what is right to serve our country and its national interest. thank you. nick, over to you. >> everything this coalition

government has done is there to serve one big purpose, which is to build a stronger economy in a fair society, enabling everyone in this country to get on in life. and i think what's striking as we published the midterm review today is that when you look around the developed world, look at america, europe, here, actually all governments are facing some very big political as well as economic challenges as we clear up after the mess that was created in the crisis of 2008. and politically, that requires two things. first, and ability to reach across party lines to act in a national interest. and secondly, and ability to act fast and boldly to deal with those challenges. and the dangers of not doing so i think are pretty obvious. you look at the kind of cliff top political britain chip and washed in last week. look at the very of some european governments to get to

grips with some other economic problems quickly and boldly enough. and it's a source of immense pride to me, and i think everybody in the coalition government, that we by contrast have put partisan differences aside to act in a national interest, and have acted fast, and have acted boldly to deal with the economic and other challenges that this country faces the other thing which strikes me as we published the document today is that, of course, rescuing, repairing, reforming the british economy is the big task for this government, it's the big challenge of our times. in fact, in my view, in many ways it's many of the of the reforms that this coalition government has initiated, long-term reforms, social reforms, public service reforms and other reforms, that will outlast and outlive the immediate economic challenges in front of us, and will stand the test of time, whether it's making the tax system fair, reducing the burden of income tax on millions of people on

ordinary and low incomes by raising the point at which they pay income tax, aggressively closing tax loopholes and asking people at the top to pay their fair share. whether it's the pupil premium, to an f. billion pounds of new money in the school system, to crack this problem of educational underachievement for far too many of our youngsters from the poorest families. giving people in retirement the reassurance they will get a decent state pension through our to -- triple lock guarantee. revolutionizing apprenticeships on a scale that this country hasn't seen in a generation, reforming welfare to make sure there's always an incentive to work, creating the world's first green investment bank. these and many other reforms are big, bold, long lasting reforms that will in my view stand the test of time. and it's that same willingness, if you like, to set differences aside and to act in the long-term interests of the country that very much underpins and informs the choices of the

six new areas that david has just highlighted, where we will be taking new steps a new initiative in the remaining two and a bit years of this parliament. and that's why we will act to provide better child care. we will act to provide a single tear pension. we will act to make social care more affordable. we will have to get more investment in our transport infrastructure. we will act to help people with their mortgages and build more homes for them to live in. we will act to enshrine and protect people's everyday british freedoms. now, there are lots of things that we've all learned, i've certainly learned, over the last two and half years during the course of the coalition government so far. i've certainly learned, we've all learned, that the damage done to the british economy back in 2008 was deeper, more severe and worse than anyone predicted at the time. and that means that the economy is taking longer to heal. i've learned that, when you take

big difficult controversial decisions, you get politically attacked from all sides. i think pretty well from day one they were foisted on the right saying that the liberal democrats were too strong and the government, and voices on the left saying the liberal democrats were too weak in the government. i've always thought that, if both sides make diametrically opposite criticisms, we've probably got it roughly about right. but the biggest thing that i learned is that, for the vast majority of people in this country, whoever you are, wherever you live, whatever you do, whoever you vote for, what you might expect is for politicians to set aside their differences and just get on with the job. that's why this coalition government in the next two and half years will use every day of every working week, will use every penny of taxpayer's money, will use every department in whitehall, to make sure we build that stronger economy in a fairer society, enabling every person in this country to get on in life. thank you.

>> thank you very much. start with nick from the bbc. >> thank you very much, prime minister, deputy prime minister. some say that this marriage of yours is stronger than ever. other say you're planning a divorce. can i ask you both how would you sum up the state of your union. and can ask you. i noticed that both of you talked about everyday, two and a half years, are you pledging, both of you now, and telling her parties, no breakup, no pulling away, no clever arrangement before the election in may 2015? you will be industry working together until the day that election is called, on time and on schedule? >> let me take the second of the question first. i've always said, nick has always said, this is a full five your coalition. the public wants us, as nick has just said, to work hard on their behalf right through this parliament to fix the problems that we have inherited and to set out and deliver the long-term plans we've spoken

about. for me it is absolutely five your plan, a five your parliament, a five your government. it's about work. it's about delivery, not partisanship. on the first part of your question, i hate to sort of spoil the party, but let me put it like this. we are married, not to each other. we are both happily married. this is a government, not a relationship. it's a government about delivering for people, because of the mess we are left in by the previous government, because of the huge challenges that we face. what we said to people two and half years ago was that we would come together for a five your parliament. we would tackle these problems. so to me it's not a marriage. it is if you like, a ron seal deal. it does what it says on the 10. we said we'd come together. we said we would form a government. we said we would tackle these big problems. we said we would get on with a mature and sensible way and that is exact what we've done. we haven't chosen to separate and do something different. we have chosen to continue just as we said with a five your

government to tackle these deep-seated problems. and i think this is a strong, decisive, active government that is doing the right thing for our country. nick. >> iran's seal deal come you could call the unvarnished truth, but anyway. will, i thought so was all right. [laughter] look, on this issue about whether we'll carry on, we legislated for it. what more evidence do you need that we are committed to doing what we have said here what it says, which is to provide safe and effective government for this country for five years. we are faced with unprecedented challenges. we legislated this fixed term apartment. it might sound terribly tacky. it's actually kind of a really important change. because it means that prime ministers can play cat and mouse with the british people about when the next general election is going to be. of course, we can fight as would will do as two separate independent parties.

we will set up different visions of the future. of course, we can start explaining that before the general election but we will govern and provide this country with good government until the election is held in may 2015. >> this is a famous document. thank you for giving it to his. i think a lot of people are going to wonder what the point of it is tonight. i can tell you the one thing they do want to know is what's going to have a with economy this year. can you both gives a picture of where you think we are? is a triple dip recession possible? likely? all you really both confident the economy is going to grow this year? if not, why not? are you contemplate other measures if this doesn't come out the way you want? >> well, the first thing i'd say is that we've been very open with the british people about the fact that the time needed to get the job done, that the time needed for the economy to heal fully is taking longer than frankly anyone expected. we've been very open about that.

we said that dealing with the structural deficit, balancing the books, is going to take longer. we couldn't have been more open that it is going to take longer, and it does mean that the next parliament, the next government, will need to complete the job that we have initiated, but we have made huge strides. the deficit is 25% more. now, hang on. it's important. >> are you confident all of you that we're on track to gross? >> i am confident that the british economy is healing. i'm confident that we're doing the right things to tackle a terrible black hole in our public finances we inherited. i'm confident we're doing the necessary surgery to our banks to make sure that the implosion of her banking system doesn't happen again. i'm confident we are putting money back in people's pockets. this april people get the biggest uplift in the personal allowance income taxes than ever. that means that 23 million basic rate taxpayers will be 600 pounds each better off than they were when this government

started. that means for a two under family, on the basic rate of tax, they will be 1200 pounds better off. that -- we've created a million new jobs in the private sector. look at a headwind we are having to deal with, still a damaged banking system the many, many household in this country are still trying to shift mortgage and credit card debt. look at the problems in the euro zone, in our own european neighborhood. i think we're doing the right things. i don't think anyone should start making foolish decisions -- statistical predictions about what's going to happen to something as unpredictable as the global economy. but we're doing the right reforms and implementing the right changes to ensure that healing process continues. >> we don't now make her own forecast. we've given it to the office for budget responsibly. they are forecasting growth this year, as our almost every other economic forecaster.

that's what the forecasters say. it begs the question, what should the government be doing. it's vital that we provide a low interest rates the economy needs and does what our fiscal strategy is so important. but i've also point to what are the things that business organizations, the wealth creators have asked for? they want backing -- they want enterprise zones around the country. we've introduced it. they want a real export driver. we get behind exports. on every issue wealth careers have to to is get behind us, do everything you can to make this a competitive and successful economy. we are doing it. so i think we're playing a role in helping britain in this globe race, but it's undoubtedly come as mixed as they come a tough in front we have got recession in the euro zone, difficulties in the banking system, uncertainties and the global economy. this is a very pro-business, pro-enterprise, pro-growth government. let's have adam.

>> thank you for what's becoming relatively rare, a prime minister erdogan news conference. looking back, do you to think he would be standing there in coalition if it wasn't for the television debates? and looking forward, will be commitment to doing them on the same basis with the labour leader as you did in 2010? >> on the outcome of the last election, i think actually, from memory, the polls going into the start of the last election were pretty similar to the polls coming out of the last general election so i suspect that the result would've been pretty much the same. the point was that we responded naturally, properly, sensibly to a hung parliament. [inaudible] spent on tv debates i'm in favor of them. i think they're good at a think we should go on having been. i will certainly play my part in trying to make that happen. >> the reason why we came together in coalition is because no 11 the election, and then we

had a big choice. whether we're going to sort of throw rocks at each other, one party against the other when we were teetering on the edge of an economic cliff, or we're going to come together in a national interest, pull the country back from the brink and starches painstaking job of rescuing, repairing and reforming the economy. i have never for one minute doubted the wisdom of that decision. you know, you get plenty of kind of rocks thrown at you in government but i think it was absolutely the right decision and i think the history books i hope will judge us fairly for believing at the time that the worst thing for the country then, which would've led to more unemployment, would have led to people's living standards decline further, would have led to greater economic dislocation, which lisa every hardship to millions of fellow britons, would have been politicians simply indulging in point

scoring and yet another generate election of few months after the last one. so i think was the right judgment in. i think it's the right judgment now. if anything i think with the passage of time people have got kind of used to the idea. the idea of coalition, unfamiliar thing for the british political system, has matured. and i think people now understand that we can ever disagreements at you can deal with it in a businesslike professional and respectful manner, and also get on with the big decisions international anxious. it's that balance between retaining your identity, being open about your differences that do that any professional way and getting the job done on behalf of the british people. yes, i'm a firm believer in the tv debates. >> [inaudible] >> a subject which you may not agree on quite so much, europe. as deputy prime minister, why do you think the prime minister's idea of repatriating powers from europe is a fantasy wrapped in

the union jack? and to the prime minister, if you when the next election, can you give a guarantee to international investors and british business that britain will remain a member of the european union and will be so in 2020? >> i'm surprised this one didn't come up earlier. look, of course we, at europe in two different points of view. i don't think it will help them much if we provide a running commentary to each other's views. my attitude is very simple. one in 10 jobs in this country are dependent, one way or another, in a position in the single market. we can't tackle things like global climate change on her own. we can't keep our citizens safe on their own when you're dealing with cross-border crime. of course the whole thing needs to reform and refreshed, made more accountable and make more efficient. there are areas of our life where we're stronger together stronger together and we grew apart. i believe that all my political life, i always will do. and for me it's jobs, jobs, jobs. what's the best way of ensuring jobs? i think a wholehearted

commitment to a leading role in the european union is part of that. but one thing i would say, even though we might come at these things are these things in different directions, actually we have been remarkably successful as a coalition at prosecuting the british national interest in european discussions. we've been working in a lockstep with each other, for instance, on the budget, taking a very, very tough line on the budget, one of the toughest the purchase of any government. something i fully, fully support. of course, you can't justify a massive increase in the european union when we are having to introduce so many cuts elsewhere. we recently worked very effectively as a coalition government to make sure the british interest in the new baking union were properly protected. smack of course at the election were going to set out different approaches based on her to parties about the european iss issue. that's perfectly natural for to independent political parties to do at the election time. but i would ask you what nick

said. if you look at how we've handled the european issue over the last two and half years, we've worked together to deepen the single market and make a more effective, made real progress there. we no longer contribute to the bailout of the euro zone nations. we've helped put in place very tough sanctions against iran and syria. so we've managed to deal with quite a difficult european situation, but i think in a very sensible, in a sensible way. now at the next election i'll be putting forth what i've spoken about, a new settlement and fresh consent for the settlement of the united kingdom. i think the opportunity get that is opening up, and so that's something i'm looking for deciding out in my speech in january. i do believe, as i said many times, including the weekend, i think britain's interest is to stay in the single market, to stay committed to that. we are a trading nation where we don't just need access to europe's markets, as nic has said, we need a seed round the table to write the rules of those markets. so that is out of the what we

want. so as i say, you can have two parties working together, managing the real issues ongoing with our relationship with europe but then setting out at the next election quite properly different approaches. >> prime minister, can you just confirm that it is your plan to serve as prime minister, the british people permitting, until 2020? and if that is the case deputy prime minister does that fit into your plans? >> my being prime minister to 2020, how about that? >> i think i've probably said enough about this subject. i entered the question very clear. 2051, and he's still prime minister. come on, we're a bit slow today. >> deputy prime minister, are you happy with the idea of the prime minister continuing as prime minister that long? >> come the next general election were all of course going to fight our corners to win as many seats and votes as possible. that's what you do.

i don't think anyone should criticize a politician for being ambitious. there's nothing wrong in that and i certainly want to see liberal democrats presidents in british politics and british governments increase over time, as i believe it will. >> thank you very much, gary gibbon channel four news. deputy prime minister, can i ask you, some of your supporters told me that they'd like to hear you in front of the prime minister a tax the rhetoric of scrapers and scroungers very directly. i wonder if you take this opportunity to do that. ..

>> the thank yous and the bios and not much else, but i'll make a slight exception today. after thanking, of course, all of you, second our panelists, a true a-team, two of whom came from out west to be here today, third, our partner in organizing this session. the washington office on latin america. and not least the donors who made this session possible including peter lewis to whom we're very grateful. the reason this is, we think, a very good moment to put this dialogue on a separate track is that we're in a period now of ferment on federalism; that is, state/federal relations, the likes of which i'd argue we have not seen in, perhaps, since the new deal. we've got a number of hot button

issues that are raising fundamental questions and all being waged not only as issues about what the right decision should be, but also about who gets to decide, who gets to make the decisionment -- decision. immigration is one of those with the federal government is asserting that the state's need to follow the fed's policy and have had a mixed outcome in the supreme court with that so far. another is the defense of mawrnlg act, gay marriage, where the states are asserting that the feds must follow a state policy that is before the supreme court this term. a third is obamacare where the states refused to follow the federal policy and sued for the right to do that and won a mixed holding from the supreme court. in the midst of all this, you have a supreme court which is itself very much in flux. everybody come on up, there are some seats in the front. don't be shy. the supreme court is very much in flux, and it's federalism,

that area of law is unsettled in the way that it has not been for a very long time x. in the midst of all of that, as if that weren't enough, talk putting a cat among pigeons, two states legalize marijuana. and this is, more than any of the previous policies, a direct confrontation with federal policy. they did it, moreover, by referendum, lopsided votes of the public. a programmer if of our discussion is -- parameter of our or discussion is none of these comments are rehearsed, but i think we're probably already going to agree that federal policy is supreme here. i don't think that's in question. what is in question is what is wise for the federal government to do in this situation, and what is wise for the states to do, because more of them will be considering marijuana, and what is wise for congress to do and the supreme court where, ultimately, i think, a lot of

this is going to play out. so we want to talk about wisdom rather than law, and we want to talk about power rather than pot -- though there will be plenty of o pot in this discussion -- and we want to talk partly about what's going happen in the next few months when key decisions are going to be made. and those are going to ricochet through the other states and congress and courts. it's really going to be fun. to guide us through the fun, we have a panel of just some remarkable experts. i'll introduce them in in alphabetical order and reverse speaking order. troy eid is with greenberg trau ricks g. he joins us from denver, for which we're very grateful. he's a former member of the attorney general's advisory committee of the narcotics and drug trafficking subcommittee on that committee. he's an adjunct professor at the

university of colorado school of law and in the immaterially, he has been honored for distinguished public service by, among others, the drug enforcement administration, the federal bureau of investigation and the secret service. he's going to help us understand law enforcement options and how to balance this power equation to get it right. michael greve, next to him, is a professor at george mason university school of law and a visiting scholar at the american enterprise institute. the cofounder and former director of the center for individual rights which is a public interest law firm. perhaps most on point today, he is, in my view, probably the country's single most creative and sin optic thinker on state/federal elections with a book on that subject from 1999 called "real federalism: why it matters, how it could happen," and a very important book on the same subject published just last year called "the upside down

constitution." finally, angela hawken who's to my immediate left is associate professor of economics and policy analysis at pepperdine university. she comes to all the way from california on the red eye. thank you so much or for that. studied at the rand graduate school can, research interests focus on drugs, crime, corruption. we have some seats in the front, all you guys. we've got at least four that i can count, six, seven, eight. eight or nine seats, so come on up and join us. angela led the statewide cost benefit analysis of california eastern drug sentencing initiative. she is a co-author of two very rell vapt books, "drugs and drug policy," published recently by oxford, and very much on point, "marijuana legalization: what everyone needs to know." she is going to help us understand some of the drug policy implication of what's happening. our panelists will talk for about ten minutes each, say

whatever they want to say, and we'll probably then go straight to questions, though perhaps with a bit of dialogue along the way. angela, do you want to kick it off? >> thank you, jonathan, and thank brookings for the opportunity to be here today. when we think about the implications of what's happening in colorado and washington and marijuana legalization more generally, it's very important to distinguish marijuana from the legalization of other drugs. get away from the ideological trap we find ourselves falling into so quickly. marijuana is different. marijuana legalization is a much smaller step than legalizing any of the other drugs would be. over the last generation, about a third of americans have lived in states that have decriminalized marijuana. and in other states law enforcement has often been so lax that when we ask in surveys whether you live in a state that's decriminalized or not, most responsibilities don't even -- most respondents don't even know.

so it's a much more gentle nudge in that direction. in terms of actual marijuana legalization, what the states actually do matters. , and unfortunately, in this case marijuana legalization got onto the books in colorado and washington through an initiative process. that doesn't allow for a -- whole lot of change. it's like someone asking you for directions, and the answer being, well, if you wanted to go there, i wouldn't start here. and that's where we are. or so we have very little wiggle room in those states to now shape policy in a positive direction, and we're operating in an information vacuum. and it's an astonishing information vacuum because no other jurisdiction in the world has legalized marijuana. in the world. not even the netherlands. so we're in unchartered territory, and we're not going to -- [inaudible] as quickly as we'd like in

washington. so if i really wanted as a policy analyst to study a well-conceived legalization regime, the last thing i'd want is a policy on the books through a ballot initiative. but that's where we have. this is where we're at. if the experiments in washington and colorado are allowed to proceed, we'll learn or a great deal about marijuana that we don't know now. we're still having a lot of speculating. sometimes the speculation is wild. such as what happens to drug use when we legalize, what are the patterns? do we see dramatic increases, and if there is a dramatic increase, does it persist over time? typically, there are dramatic changes around a policy intervention anyway. no matter what you implement, things move. and things only typically start to settle down in year three or year four postintervention. are we going to have the patience to wait and see what happens when this shakes down? what's going to happen to dependency in those states and to problem use?

does the age of initiation change? are kids going to start earlier, are they going to use more, and what's going to happen to those children? people will care. what's going to happen to drunk driving? what's going to ap to drug driving? -- to happen to drug driving? what'll happen to er admission? will criminal behavior change, especially around retail stores? what's going to happen in neighborhoods? those neighbors will care. and very important, probably more important of all, what is the relationship between marijuana and our most dangerous drug of all, and that's alcohol? many people will think differently about marijuana legalization if it leads to an increase in alcohol use. and how we'd feel about it if marijuana use led to a decrease in alcohol use. and we don't know. we're just guessing now. are there substitutes? this is a very different universe if one gets traded out for the other. we're just getting at the

magnitude of these relationships, and these are extremely consequence cial following a reform like in the. the the federal government will be concerned with these kinds of outcomes, and if these experiments are allowed to field, we'll learn about these important issues, and we'll know. that information vacuum will, hopefully, be closed. so i'm really frustrated by a lack of knowledge. we're making marijuana policy in the dark. i would like to see these experiments -- and i do call them experiments. these experiments be given a chance to thiess play out long enough -- for at least play out long enough for us to learn. and an experiment in two states than in many states, and other states will tip since this is the time to use the language of experimentation. a primary concern of the states will be whether washington and colorado flood the rest of the country, a reasonable concern. colorado and washington may become the weighhouse for the other 48 states. it does not seem reasonable to

expect the federal government to allow colorado to create a system that profoundly effects the other states. so the price of federal acquiescence should be minimizing out-of-state consequences. and when it comes to legal marijuana affecting residents in other states, the media tends to obsess about -- [inaudible] i think that's what makes it more fun. but pot moving towards people is equally important across state lines. pot moving in both directions is important. but tourism somehow attracts more of the story, so this is going to be extremely influential in shaping how the general public regards marijuana legalization. and especially -- if and when, a matter of time -- the subjects this those stories include children. the federal government must not want to make a show, some effort to stop tourism promotion, even if it can't really stop it, it

needs to make a jess eture towards trying to make it stop. if states make a good faith effort to stop the promotion of pot tourism and it happens anyway, they they can just say a hard thing to do. but if they don't get involved, it looks as though they're condoning it, and that would be a good thing. so movement in both directions are equally important. do not expect to see an effective ban on out-of-state use, but as an example -- [inaudible] if you advertise out of state either by pot going to people or people coming to pot, if you advertise and we find that you're involved, we don't care where you are or whether you are complying with your state's rules, we're coming to get you. might want to make that a form of prioritization on that sort of promotion. they can tell the private promoters as well as states that

aren't bothering to do the restraint on their promoters. the federal response is watched very closely by colorado and washington state, but they'll also be watched very closely by the other states that are considering their own marijuana reform. what about these states? massachusetts, california, oregon, nevada, maine. the question is no longer when these states will -- if they'll legalize, it's not a question of if they'll legalize, it's when. and there's compelling evidence to suggest it will be in fairly short order. multiple experiments, much harder to turn the boat around. we have to think about how to handle that. what do versions of those laws look like, and how are they influenced by how the federal response looks now? don't think the well-heeled efficacy groups that are very much responsible for drafting

these ballot initiatives, don't think they respect paying attention. -- they aren't paying attention. they'll note that the federal government's going to have a much harder time thwarting legalization in colorado than in washington. why? because the colorado initiative is -- [inaudible] it's much easier to crack down on legalization when a strong regulation plays. so the easiest way to legalize marijuana if you want to get the federal government off your back is simply repeal your marijuana laws and have no regulations in place. that's a perverse situation, a really perverse situation. an aggressive federal response could stimulate more loose versions of marijuana legalization with even fewer protections for the groups of people we care about, like our children. on the other hand, federal agencies could use their discretion to shape the markets in a way that offers more protection. they could use selective

enforcement, make sure they go after the target that marijuana-related businesses advertise or aren't imposing a minimum price or aren't testing for molds or pesticides. we have a lot to learn about marijuana. it'll be fascinating to see whether that learning is allowed to take place. and so far the federal government's given very little indication of how it plans to proceed. aside from a few protocol statements from the department of justice and, of course, the president interviewed on tv. so let's take a line from bette davis: buckle up, it's going to be a bumpy ride. [laughter] >> thank you. a few just clarifying points. it may be worth noting that the on-of of the-ground issue here is although federal law prohibits marijuana, the feds do not have the manpower to enforce that except at a high level, is that correct? >> this is why it's much harder to control. because in colorado, in colorado

there is growth for personal use. there's no way you can control that. how do you have the manpower to do that? if you have a state that allows very limited members -- how you can set up a shop and that is only dedicated to selling marijuana in washington state. when you send out a couple of hundred letters, you're done in washington. and describing some of the -- [inaudible] you're going to go after the landlords for renting out space. so it's so much easier to shut down a shop than it is in a -- [inaudible] environment. and the version of the colorado law makes the law enforcement side much more challenging. >> so the next thing a state could do is simply repeal, right? and say, well, if you're going to crack down on a regulatory system, we'll legalize without a regulatory system, and do what you can. >> you might notice that i think some of the initial efforts were

a bit rebellious by nature. every marijuana user just -- [inaudible] i think some of them have a distaste for this becoming legal because now they're abiding with the law. [laughter] so i think what there is is a very aggressive response. you are going to see much more aggressive versions of the law, and by that i mean versions of just repeal. >> it's interesting, what we're seeing here is in some ways the breakdown of a federal/state law enforcement partnership in which the feds rely very heavily on the states which leads us to michael greve who will give us some broader context on what we're seeing unfold here. >> right. i'm against partnerships, and i'll explain why. there is a sort of tempting federalism perspective on this which says something along the following lines, and angela alluded to this, um, look, the signals the resilience and resurgence of american federalism because there's no reason to distrust the local

political process. and so let states experiment, and hoo rah for federalism. i don't think that's necessarily wrong, but i want to in the spirit of for panel complexify this a little and make a few quick points. the first one is this: look, it's a perennial problem of american federalism how to stabilize political experimentation and compartmentalize policy competition along state lines, and the reason's always the same, spillovers just kill you. so under the current regime federal, i mean, federalism experimentation can take place only to the extent that the feds don't enforce the laws, and that's somewhat problem problem. on the other hand, if you decriminalize marijuana at the federal level, you won't be able to contain the flow of marijuana into states that don't want it. you can't do so as a practical matter, i think, and angela knows much more about that than i do, but i know you can't do so as a constitutional matter

because once marijuana is just another article of commerce, states can't ban the import. so maybe in that situation you'd still need a federal law along the following lines. um, the transportation or importation into any state for delivery or use of marijuana in violation of the laws thereof is hereby prohibited. i didn't pick that up, that's the section 2 of the 21st amendment dealing with liquor and what those things try to do is to allow states that don't want booze in their states to remain dry and maybe you need something like that. you see something along same lines or very similar lines at any rate with respect to gay marriage. what do measuring a tries to do -- doma tries to do if part is compartmentalize gay marriage along state lines, and that

isn't going along so well. what you have to ask the apostles of state experimentation, seems to me in those kinds of circumstances, look, are you really in favor of a decentralized solution, or is this just the strategy of island hopping towards your favorite solution? we don't ask that question often enough, but maybe at one of these days we will. that's my first point. my second point, i think, and third point are much more important, at least to me. there's a preoccupation in the land with the question of the breadth of federal powers. how far does can federal power extend under the limited powers doctrine? how far does the commerce clause reach with respect to criminalizing possession? that was, of course, the question in the rauch case, and i'm not going to reargue that here or even try because my question is about the depth of the federal power or what madison called the national operation of federal power. assuming congress has a power,

in what form can it exercise that power and act on states? and that's a hugely important question especially if the united powers reach as far as they do today. so allow me two minutes off common law 101 on the basic constitutional structure. the basic rule, the first basic rule is -- and jonathan alluded to this -- is that within its enumerated powers, congress can preempt states any day it wants because federal law trumps any and all state law. that's the basic order of the supremacy clause. and that's implicated in the dope debate but not, i think, in a very interesting way. state laws provide or may provide a safe harbor against local prosecution under state law, but not, of course, immunity against federal law. i recognize there's an arizona state court ruling to the opposite effect that seems to suggest the opposite, but i think that's no good, and it's plainly wrong. that's the first proposition on

preemption. the second proposition is that the federal, that federal preemption and supremacy must take the form of a prohibition. that is to say either a direct regulation of private combat -- don't smoke dope -- or as in true preemption cases of direct or implied -- [inaudible] against certain forms of state combat. and this is an example, no state shall go anywhere near the rates,outs and services of airline carriers. that's preemption, that's prohibition. to puppet in the other way around and to put it in the terms in which the supreme court has put it, the federal government may not commandeer states. that is to say it cannot compel state legislatures to enact laws, that's new york v. united states, and it cannot compel state officers to execute federal laws, that's prince v. united states. that's obvious here, the obvious implication with respect -- or

the most immediate implication with respect to the dope implication is, look, no state has to criminalize marijuana just because the feds do, and no state has to enforce federal laws or prohibitions although state courts, of course, are still required to do so. now, it turns out that that sounds trivial, but i think it plays itself out in hugely important context, much more important in their own way than the marijuana context. so here's an example. excuse me. one of these days the supreme court will decide whether it wants to grant cert or not in the second go around of a case called bond v. united states. it arose over, basically, a marital dispute. she, wife, smeared a chemical on a doorknob and the car door of her rival, and this resulted in a thumb burn. and this woman was then prosecuted by state officials in

pennsylvania under a federal law that implements the chemical weapons convention. it's called bond v. united states. and the question in this case is whether the federal law is even constitutional. i don't think so, but the third circuit said, yes. but even while saying yes, all of the judges on the third circuit said what do you people there at the local level think when you enforce these kinds of federal laws? you don't have to. the reason why this matters is, you know, the heritage foundation has had an overcriminallization work group, federal overcriminallization work group for the past, i don't know, 15, 0 years, and it's never gone anywhere. but it might go someplace if local officials could stop themselves from cooperating with the feds in enforcing these ludicrous federal laws. many of them would turn into the press releases that they deserve to be. [laughter] and if they stop doing so here, that would be progress to my

mind. now, a much bigger problem, and -- or much bigger implication here, and that comes to light if you ask yourself why is it that the united states constitution has this regime; preemption, yes, commandeering, no? there's a dissent in the prince case that addressed this question written by justice breyer where justice breyer says something along the following lines: look, many be federal systems in the world rely on commandeering, on the execution of federal orders by state officials. and he prominently mentioned the european union. and they do so second, said justice breyer, because it's more federalism-friendly. pause if the feds -- because if the feds must enforce their own laws, you get centralization, and the federal government will swarm hither officers, and you'll get precisely the results that federalism is meant to forestall.

there are answers to these questions, and i'll give them to you for free. the fist thing is that commandeering, partnership, intergovernmental cooperation destroys responsibility and accountability. look at the e.u.. did the e.u. destroy greece, or did greece destroy the e.u.? it's probably both, but you can't tell, and they all blame each other. and the founders didn't need the e.u. to see these dangers. all of this arises from intergovernmental cooperation and commandeering. the founders didn't need the e.u. because they have the example of commandeering in front of them. it was the articles of confederation. and so they wrote a constitution that prohibits this and makes it very, very difficult in any event. the second objection to justice breyer or, rather, the objection to his second point is, well, if the feds want to send swarms of

officers, let them try. as angela already suggested, they can't, and they won't, and if they do, they will have to pay the fiscal and political price. so i think in a weird way it would actually be great if we had fbi agents in santa clara breaking down the doors of gravely-ill pot smokers. that'll tell people more about the federal government than 15 papers from the cato institute. [laughter] one last point about this and then i'll end. you see the force of the anti-commandeering rule in something that jonathan mentioned at the outset, and that is the affordable care act. this seems far removed, but it really isn't. if you look at the affordable care act, there's, by the way, same preoccupation among conservatives and libertarians with thebredth of the federal government's power. how far does the commerce power go. but the man tate that was at issue -- mandate that was at issue in that case, in the nfib

case, that's not the engine that drives the affordable care act. the engine that drives that act is the exchanges, the state exchanges, which weren't even at issue in that case but will be, i i hope. here's the way this works. initially, the administration and congress wanted to congressman dealer states to establish exchanges -- commandeer states to establish exchanges. they realized that would be unconstitutional. so instead what the act contains is what's called a provisional preemption regime which says you states have a choice. either you establish or an exchange under our orders and in accordance with our desires, or else we will stroll into your state and do it for you. um, and i think it's great that 18 states or something like that have said come on in, let's go. many of those states, by the way, have also said no to the medicaid expansion. if you want to do this, you,

federal government, will take responsibility for the inevitable failure of these regimes. if you want to build this contraption, build it on your own. there are, of course, the usual voices that say, oh, come on now, this is destructive for federalism, and it's destructive of health care, and i don't think that's true at all. i think the federal law, the exchanges this convoluted structure will create with or without the states' cooperation, but that's neither here nor there. what matters is the states' insistence on letting the feds take full responsibility for whatever transpires from this travesty, and that is, to my mind, the states' and federalism's finest moment. ..

>> we get that impression, sold on the conventional wisdom here is about well, the federal government and the states have got to work something out. the only way to do this, if in your view they should work something out, somethings got to give. either the federal law just doesn't get enforcement, states de facto are in charge, and if, what, somebody katie bar the door? or the federal government really does try to enforce and i are all the agencies to step in, which do you support either of those outcomes or some third? >> i have no view of the policy implications at all. >> i'm not asking about

marijuana. >> right. bring it on. let the feds come in. >> so the state should do what the states to? >> absolutely. >> and the feds -- than the states will effectively have called them off to? >> yes. >> that's accountability. >> there you go. >> troy eid, very important question came up. you hear a lot more about that in the next few months. spillover, how you do with all the messiness. help us understand the choices that the obama administration make and how you think out to deal with this. >> it's good to be here. i want to thank brookings and appreciating her with angel and michael. this whole thing reminds me of the story, i'm just a country lawyer from colorado, but the story of the guy who prayed to win the lottery ticket. he just wanted to win the lottery over and over again, and he was constantly asking the lord, would you help me? would you out of? i've lived a good life. i've never asked you for very

much, and years went by come he never won the lottery. finally, he is down on his knees, help me, i need this money so badly. finally, the clouds part and a voice comes down from heaven, why don't you meet me halfway and just buy a ticket? >> guest: colorado and washington just wanted to get. about a ticket to the slaughter. now we have to figure out is this a can of lottery that will be good or bad. if you don't like lotteries, i respect some people don't like them at all, can this be a less bad lottery than it otherwise might be? think about the winners and losers if you will. because when you design the lottery in the states or anywhere else, you are thinking about a world where you're maximizing public benefits or your minimizing the and ford affects of the david ricci writes its all bad but you also might say this is a imperfect world, we need the money, we're going that some payouts but we will make some people very, very rich by the way, but we are also going to try to maximize some sort of social value. who are the winners?

i know it's too soon to tell. take it with a grain of salt, but the big loser if they don't step up is congress. if ever there were an issue that congress ought to address, it's the marijuana conundrum that we find ourselves confronting. and i say that knowing that i am in d.c. and everyone will probably stay there so many important issues here, the budget crisis, the manufactured fiscal cliff that we all went through, the charade of the fiscal cliff will create a crisis and they will somehow save the day through partisan sniping back and forth. i mean, this is a real issue. we need some guidance on this, folks. and congress used the place to go. this is the democratic discussion to have come and we're having a discussion of the state level in colorado, and i applaud my friends were working on this issue. we're talking about all the implementation issues ranging from taxes and how to you set the right tax level.

thankfully in my state you can't raise taxes unless the people decide that you of the vote to raise and. the legislature can't do that unless we decide as voters, which is great by the way and i love that initiative. we're going have a debate over this issue and will have a proposed tax on marijuana in my state. if you set the tax too high you might have a lot more black market behavior. that's part of the issue at a democracy has to work through. so why can't congress be relevant? are we that cynical that we think they can't be relevant to take on an issue that is so important as this one? and where voters are voting with -- 18 states now medical marijuana has been approved, all. there's a problem the u.s. criminal code, another two states, colorado and washington, then you also a close vote in other places, even arkansas was moving toward some recognition of cannabis. so you're starting to see even in the deep south there is a sense of some change going on. so congress could be a loser but

there's a chance for them to w win. representative garrett, senator to get a democrat in my state has joined up with republican mike hoffman and devastate auction bill, let the states opt out. i realize there's a lot of problems with that but look back to fdr in 1932 election because he was finally able to march the west to get something accomplished and begin to move our country towards some understanding, a contentious issue that has ultimately good and bad effects, no matter how we sorted out. so they congress relevant if they dare to do it. and start it all. what else are they doing in all seriousness? would also be doing to us out of the trenches? the president when someone what. he is already one. he got more votes in colorado as a george soros said, because of the turnout from this amendment, which by the way worked his own vote in my state which one, unexpectedly. but the president will be vague. he should be paid. the justice department's, i served there, full disclosure, i

hope they will continue to be vague. they don't need to tell people how to enforce the laws. the laws are on the books. quit whining about all, we need eric holder tell us what to do. stop it. we are americans. we know they have prosecutorial discretion. congress could step up. don't whine about the administration. it's ridiculous. the states could win big. we have a robust debate in colorado right now going on. i talked about taxes. we need to talk about issues like potency and consumer protection, want to give a young people. all these specifics are the products of a debate that's going on with the governor's task force, a lot of good people from different parties. we will make our way. we can wait for the feds are we can actually stand up and do it we do, which is run our own lives. we'll do as much of it as we possibly can. and we'll say openly what happens with it. but state and federal is a really good game. federal law enforcement, my friend, i served with you.

you win. you absolutely win. you are more important than ever. because regardless of how this marijuana discussion goes, we have tremendous address issues that will come with it. there will be a black market. my friends in the dea i going to have to take on the challenge as they do so effectively today, not just about around the world. there are international applications. look at mexico. they're having discussion on marijuana decriminalization, much less popular by the way in both in mexico than it is the united states but they've had so much carnage in the country, 60,000 dead by some estimates in the last six years. 25% of what the cartel supposedly makes in mexico comes with selling marijuana to the united states. so our friends in the dea, those who support them elsewhere in the federal government and law enforcement of the task force is that michael talked about of the state and local level, they have plenty of work to do. they're doing a great job. they will be even more relevant in the future as they deal with the scorch of prescription drugs

which is a whole nother metairie to talk about. we are going to get truly serious about that threat and many other threats that we face? then finally, as we look forward to the people, to the people win or do the people whose? one presidents -- one president said, we cannot possibly imagine a successful form of government in which every individual citizen would have the right to interpret the constitution according to his own convictions, beliefs and prejudices. chaos would develop. that was dwight eisenhower during a crisis. and during, we have to recognize this tension between the need to uphold federal law, make it relevant, and on the other hand to recognize that people want change. sometimes they are inpatient for change and sometimes in a society there's a reason for them to be impatient for change. and so as we look forward, the best way to honor the constitution is to let everyone do their jobs. we will do the best we can at the state level. we could use some help. we know congress could help us. they can help us today.

i pray they will help us. they should do their job, and they can set the law and we can begin a discussion about how to deal with this new lottery that we've all created. thank you. >> thank you. again, let's clarify a little bit what the options are. paint a couple world force. he wrote a very interesting article arguing that there's a need for congressional action. walk us through why that's important. give us briefly one world in which congress essentially does nothing, remains preoccupied, and you say is a really possible that congress would do nothing to say gridlock and preoccupied itself with harmful trivia all the time to help that was a rhetorical question. >> all, of course. please forgive me. >> walk us through what congress does nothing and we're relying on federal prosecutorial discretion, policy set by the white house, possibly unset by the next white house. compare that with a world where congress steps up and acts in

terms of the practical implications. >> it's a big question and just a very brief answer, we expect out of them. they've got to be able to follow the law as they know it. they are not law professors and they shouldn't be. we've got to be able to have some clear direction as to what to do. we've got to states that are purported to that a federal criminal code. that's the problem. we've got the other states that are medical marijuana states that are ineffective in the same thing. we've seen enormous change by the with medical marijuana. and my state colorado passed in 2000. for a number of years it was very slow getting started and then suddenly when the state announced that they're going to allow the regulation to proceed with leading the dispensaries flourish and the fed did nothing. they really did nothing and i was there so i know. by the time we ended up the last four years, we had a tremendous increase in dispensaries. in denver we have more

dispensaries and starbucks heading into this election. we had tremendous reduction in the age of the average user from an average of the mid '50s when the initiative was first passed i in the year 2000, the 0 years old at the time the election, this past year. so basically what happened is the states will be examining just as angela said. and unless we have some clear direction as to how they should develop, what we do in colorado is drive and washington will drive and a lot of other states x-ray states that don't want this, just as an prohibition they should be able to have their own laws. but, you know, how do expect the dea and local drug control task force is to be able to contend with the kind of a problem? and internationally will be affecting both candidate and mexican and other parts of the world. >> what is congress specific value added? >> they could do two things. number one they could definitely clarify as in the case of an opt

out that it's possible for states in certain conditions to go their own way, but then it would have to be some national consideration of what these issues are. the other thing is medical marijuana. it's about time we get a pharmaceutical clinical trial. we should have some extension that lets those who are experts in scientific medicine determined with the values are, what the potency should be and so on, what is the medical found to be able to take it to a clinical trial if it has medicinal value and then how do you dispense it probably? should be dispensed to private businesses? should be dispensed to pharmacies and so unlike other medicines. we need congress to look at that issue as a. >> do you think there's a role for congress? >> i think that's a theoretical question, because i think congress is out of the ballgame in terms of just about everything, and has no intention to go back. there are a million issues that it ought to revisit, million issues of the affordable care

act, there's a million issues here and there and everywhere. and the reality is we live in an executive state, and congress is impotent. and that's not going to change. >> so in practice the world we live in is one in which this is going to be a policy made up by the state, interacting with the white house? >> yeah, not suing each other, but in a very messy policy environment. i just want to add one thing to this, i don't know -- whether i disagree on this. you see this more and more frequently, that the administration -- because it does congress won't do anything, makes policy by official announcements of non-enforcement. so we're going to have our own de facto dream act which congress refuses to enact by administrative non-enforcement. that's very clear example of the

dynamics here. we might see the same thing in drug enforcement. we're not going to enforce it, period, because congress will enact a law to that effect. i find that to go much beyond the ordinary exercise of administrative and executive discretion in law enforcement. its policymaking by non-enforcement, which is to my mind a very, very -- congressional statutes to the contrary, policy difficulties with that come but they're also real constitutional problems. it's sort of one more dysfunction. >> that's not the way things are supposed to work. angel, invest in fiber, in practice congress days at and you get a vacuum in which there's a lot of back and forth. is that a stable enough environment of the kind of experiment to have?

>> he implies -- [inaudible] you have an agenda and to try to reach some objective. i am not prolegalization. i'm pro-good public policy. we need an experiment. whether this is a stable commission, and as i mentioned, i do think you can have a good extreme and one year. i think we need a long enough timeline, stable enough to give us a time to determine if it's worth something. i think that's going to be another question. nothing looks like in year one to like it looks in year three and four. i'm not a lawyer at the link an image, okay, your backyard. on the following conditions. subject to minding your manners of the state, making sure this doesn't spill over to states

which don't -- make sure you keep your own -- make sure the resources people become depend and it will, to make sure your state is responding responsibly. it's still unclear what's going to happen. give them a little time to figure it out. >> wait until this are putting a appropriations. >> i have to be so news for the audience. if you'd like to take a load off if he would have seats in the front. the other good news is i'm on the panel. before good questions, i want to throw a few comments out of my own. because as monty python once said, now for something completely different, i'm going to bring in what seems to be a side issue, briefly, as henry viii said, i will be keeping along. but this is not a side issue. i want to talk or just a minute about the lessons of what i think is perhaps one of the

great public policy successes of the last 10 years, or at least public process. and that's the gay marriage debate, which is a debate i know a lot about because from the day it started i've been advocating going through that at a state level issue. and not nationalizing that issue. and it turns out to be surprisingly relevant here, and i just wanted to take a minute to get you all thinking about that and the lessons we learn from them. marijuana, gay marriage, what do these two things possibly have in common? actually a law. most specifically and generally. specifically, they are both very controversial, moral issues. a point i will come back to. they break down heavily on generational lines. they are both issues on which it was once a strong national consensus, which is now broken down. the region disparity between the more libertarian left and the more judgmental south. we see rapidly changing public opinion in both gay marriage and marijuana. we both, both of these issues in

the last couple of years reaching a tipping point where just about 51% of the population calls for policy change, and they're both the way primarily referendum, like it or not. not through vote legislation. and they are both in the united states, into a large extent in the world, completely untested policy. the public is being asked to digest. there are also similar in a broader sense which i like to point out, which is they are also what i call de facto social issues. a social issue is a moral value issue. it's an issue in which people are divided not a long policy lines coming in the commission attacks a 35%, or 25%. the long issues are right and wrong, good and evil. these are very difficult issues to compromise on. as we know from the abortion debate which is the granddaddy because you're talking about fundamental values. one of the changes we've seen in politics in the past few years is more and more issues that are not inherently social value

issues are acting as if they were. immigration is one of those. that's become a law and order issued on the right. it could be an issue about how many green card, how much border enforcement is cost-effective. it's about our people of bang the law on one income and on the other hand compassionate human rights. obamacare is also turning guys has been in many ways to a social issue. the right use it as a moral question about article and have have a socialist question or not. not a health policy question. gay marriage is a social policy question. it's not just like can first cousins marry. it's fundamentally, do you approve of homosexual conduct are not? what is your view of the bible? what is your view of tradition? what is your view of human rights and equality. things that are hard a couple muslim. nl marijuana which would argue also behaves as drug policy does as a social policy issue, social values issue to a large can send the president obama and the administration have said we're

going to do with this as a legal issue. we're going to do with the law tells us. unfortunately, as we've been hearing the law isn't altogether clear on this. to be a lot of puzzling over the law. drug policy doesn't settle it easy. partly because as angel said what we're talking about is making decisions in a vacuum without having information you. how do you handle these very contentious social issues so that you can reach a point where the country reaches a stable more on this commonsense outcome without a 50 year culture war, the times we've seen on abortion. here's what i think gay marriage offers a very important lesson. which to some extent i think and disagreement with michael. i think it's been a complete success. it's not a success if you're a gay person and you're a married a gay person out as i am, and you are married in d.c. and every time you can utah to virginia your marriage magically disappears. that's not satisfactory to us. it's equally unsatisfactory if you believe as many conservatives do we should have

won national marriage policy against same-sex marriage and you want a constitution amendment to ban it. however, i would argue that this has, in fact, been a huge success to the country as a whole for our politics antifur gay marriage, because it does things, it does four things we will. first, the policy of delegation to the states which i should've said clearly this is how we've handled gay marriage. federal government has taken almost no action. all done at the state level primary. first it reduces information. states that a chance to try the policies to see what happens. whether this kind of also not. you know whether divorce rates go up or down, what happens with kids into. we are starting to get that information. it leads to the second advantage, you're much better at managing risk if you don't have -- one outcome or the other. if you manage risk more intelligently that way. that also allows very important politically for adaptation flexibility. we don't have a national

consensus on marriage and we don't have a national consensus on marijuana. my view is that we won't on either of those issues have anything like an incumbency census anytime soon, though i think we'll get there. you need a policy. you don't want to set in concrete a policy which time very quickly underlines because it's a standby public opinion. delegating these matters to states is a very good way to keep the policy at a level where it can adapt and change is public opinion. as it has been going on gay marriage. finally, delegating a policy gives you time to build a consensus. is the supreme court were to come in and order same-sex marriage, which is, in fact, before it is very term, it would preempt the national debate at a think has to happen about what is the right policy. that debate has a long way to go and i've argued that gay people benefit very, very significant from letting it unfold. marijuana i think a similar in all those respects. i think that from a point of

view of wisdom to set aside law, the federal government ought to do with the states are doing, not as a threat but as an opportunity. and opportunity first to adapt to change of public opinion without putting all of policy on an influx of putting were ultimately it just cracks down because people are not with you anymore. second, a chance to find what works and what doesn't work. some of the questions that angela points out that we really need to get answers to if we're going to do this right. i think some of our allies in the prosecution of the drug war overseas would also love to see it develop a system and workable policy. third, not least important, a lot of the discussion has been frozen 20 or 30 years by the federal drug war over what exactly marijuana policy and drug policy should look like. this is an opportunity to start a debate and it would be a pity if we don't have it. having said all that it is important to notice a very important distinction between the gay marriage debate and the

marijuana debate. it was easy for gay marriage. marriage has been a state level issue since actually before the time of the constitution, going back to colonial days of marriage was state issue. that's made it very easy and natural for the federal government to step back and thus let states go their separate ways. hasn't made a politically uncontroversial, but it's made it natural. on drug policy the federal government has been the primary actor for what a century now remains the primary actor, and it would be a real change in direction and not a natural thing at all for the federal government to say, you know what, we're going to cede territory to state level experimentation. that in itself would be a major shift in direction and not a particularly easy one to perfo perform. so with that as a caveat, let's launch into, why do we go to come got what, 35 minutes. we've got some extra great people in the audience. the rsvp list is any guide, we have representatives from

foreign governments are very directly involved in drug enforcement. we've got people from the drug enforcement administration. we've got white house office of drugs and control policy. let's go to all of you. we have a microphone -- oh, by the way. i'm sorry i forgot to mention. now is the time we also have a twitter hash tag. the twitter hash tag is eimj, it will be brought to me if it is any good at all and we'll get and discussion. if it's not a good question, don't bother. so there's a roving mic and let's see who will break the ice. i cannot resist a man who faces a cowboy hat in order to ask a question. let's go first -- >> we know where that one is going. >> thank you. howard wooldridge, law enforcement against prohibition. i'm concerned with what has been

in one before i saw in october the lack of discussion on public safety. from my perspective, 18 years of the speak up, marijuana prohibition reduces greatly public safety. a couple years ago there was a senate hearing, 200,000 children sexually abusive home are guarding. my profession only arresting 2% of people who have child in their home. as a police officer i know we spend about 10 million hours to arrest about 800,000 people for marijuana. never cashed in this assist it is we're searching in a car and there's no marijuana found. it's not capture with statistics nation. so we are spending millions and millions of hours chasing this green plant. we're flying around in helicopters as opposed to catching the pedophile in a chat room, for example. during the 18 years, i went to zero, zero calls for service generated by the use of marijuana. i'll call use generated about

1300, including homicide, suicide, rape, child abuse, et cetera. one of the things i would like the pedal to discuss, are you talking to street-level cops, especially those who have no skin in the game, they are retired, not trying to protect a grant, overtime, et cetera, to determine how much police resources are put into chasing the green plant? >> why do we take a couple since we have a mic in the middle. is a gentleman in the row behind you on the aisle. >> thank you. i am from one of those governments you mentioned, the netherlands. >> i think the context was even then netherlands. >> i was going to say that the united states is rapidly becoming a more liberal country than the netherlands, because we only decriminalized and not legalize, as was rightly mention. but i would like the pedal to address the implications a little more. when the federal government decides to leave these states,

leave the states into books because it's clear violation of international obligations by the united states. they ratified several treaties, which don't allow for legalization in any way of marijuana. >> very good. >> if the united states decides not to enforce these ask, these international obligations, what with the effects abroad be? you've always asked other countries to obey by these international treaties. if you stop doing that yourself, could that mean that eventually other countries that produce the drugs decide not to live up to their treaty obligations? what kind of effect would that have, so i would like you to address that, thinking. >> thank you. why don't we do those two. i was hoping you would tell us how this affects our international obligations. who wants to talk about these -- any comments?

>> i would you say in terms of cops on the street, i appreciate the point of view, in colorado i think our debate is relevant to what you are saying. number one, the main issue that we have is determined when someone is driving, dui, what does that standard going to be and how are going to test people in a way that complies with the civil rights but, of course, has the overriding effect of addressing public safety. we had a lot of testimony. we had a lot of speaking out pro and con for law enforcement throughout the campaign in colorado. about public safety implications and whether moving toward legalization was better or worse than the status quo. i appreciate your point that i would tell you i suppose worked a lot on my own career in law enforcement and prosecution, there's disagreement. i've heard passionate disagreement from a lot of people i respect. one thing we have to do now is come up with a standard that will protect people who come and visit our state and drive on the roads so that people know that there is going to be a safe

system for them. and we're not sure yet how to do that to our legislature has this as job one that starts this next week in colorado. i think your point of view, your input would be really valuable in our state. >> you are against legalization and colorado, is that right? >> yesterday i was supposed to. i also publicly predicted it wouldn't pass. so my credibility is nil. [laughter] >> i have to say i support and i predicted at the time. following on the, i think come in research i hate to say this but this is why -- [inaudible] makes a difference. i think they're completely divided on the issue. i don't know how it's going to shape up because i'm not an advocate and the like to see the bases before i make up my mind. give us a couple years. >> it's not the same shakeup, right? different places could handle this quite easily.

>> that's right. >> how about international? there's no easy answer on this. it's already the case of state and federal government are at different places on this issue. nothing changes that. anytime in the future, unless we can imagine a world where public opinion swings back and go back to state policy. so we do we do about international obligations be? this is yet another example as to why you can't just let the states do their own thing with no congressional leadership. you're going to have to consider issues like the gentleman from the netherlands said, and if you just stand back, and this with all due respect, different from gay marriage, it's not a crime to marry somebody. some states will recognize of a nobody as criminalizing that. this is why congress has got to lead. we live in this netherworld now where you've got law enforcement resources in the tens of millions devoted to a policy that states have said we want no part of. we have got to get some leadership, and internationally this is key. we will be affecting the

netherlands, a lot of other places. we have obligations that those of us in this day whether we voted for it or against it, we did not consider that. i just want to say, with all due respect, i don't think anybody thought about the netherlands when we voted either up or down on this. >> what happens with these international -- what happens? >> well, i don't know the specifics of the treaties at issue. there is, in fact, another one of the sort of federalism issues that you mentioned at the beginning that will come to the forefront. our international obligations, by and large, two of our consular obligations, even, and it is true in this regard, that is, we the united states find ourselves internationally too,

not to decriminalize marijuana. it will bind the federal government, the state governments and the answer to foreign countries, and was there something in the treaties that we committed to the answer is sorry. >> this is an uncomfortable issue for the united states. we spend so much time looking at countries that violate international treaties. i think this will be -- [inaudible] the 1972 treaty by 184 countries, and there is precedent now, i think latin american country that announced the resolutions and then they reiterated the reservation -- [inaudible] >> if that goes through, the u.s. could -- [inaudible] >> what could happen is the u.s. could essence of do the same thing.

denounce the resolution. then reclassify about marijuana. so there is some, not that we -- [inaudible] >> let's take a couple more. do we have a -- twitter hash tag reminder for you out there, bimj. let's go to, there's a gentleman in the very, very back. let's be democratic. thank you, yes. my question is for troy eid. first off, thank you for your comments today. i thank you for taking a pragmatic approach. i was wondering if you clarify that what your ideal kind of congressional solution to this would be. ..

my position as congress should be doing this. i've written elsewhere and talked elsewhere congress needs to have this discussion now and start stepping up to the plate, reflect the changing attitudes many people have on this issue, figure out what to do about drug abuse and so on and come up with a political compromise that reflects reality here in a way that we do not i think in our national public policy. >> thank you.

let's take another microphone during a anywhere closer to the front. why don't we come up front here. we have gary mitchell, a gentleman in a red tie. we will take the gentleman with his fingers up. >> thanks very much. i write the mitchell report, and i want to ask a question that follows from the first one that was asked about law enforcement perspectives and i will direct it to troy but if others can, and that's great, too. in the hearings and the conversation in colorado around the legalization what were the perspectives you heard from the sort of public health social services committee on this issue. >> mr. mitchell that is a great question. the gentleman in the red tie. >> i am an economist which means i am in favor of more liberal drug policies. at least i'm not aware of any

economist who isn't. i'm also a retired analyst which means i don't use any illegal drugs myself, but i got used to the policy 40 years ago in grad school. i was persuaded by the argument that it's less dangerous than alcohol or tobacco and told her co-authors agree on it was also a time when there were major marijuana commissions in the u.s. and several other countries of which recommended the policies and only the netherlands followed the advice of its drug experts. and in the u.s. we still can't get marijuana out of the controlled substance act even though it clearly doesn't meet any of the three criteria for being scheduled so my question is how we is drug policy so immune to common sense. [laughter] >> all right, there is a gentleman here. >> i'm a columbia american

economist also. for 35 years i started illegal drugs in latin america and a year ago was nominated and selected one of the 13 members in the united nations control board. when you say is true that the united states defer the states don't have to comply with international treaties. the problem internationally is that international drug control regime is our creation, was created by the united states so internationally this is going to have greater precautions. i don't know exactly what it will have the this isn't neutral. in other words of the united states talks we are going to have to confront today in japan,

russia, sweden for example whoever has the three most aggressive. in latin america in three days on the 12th that is a line for the vote on the readmission of bolivia for supplying to make the assurance so there were five countries that objected. the united states, the united kingdom, canada, italy and sweden. so what we see is a contradiction in the policies and from the point of view what we see is what they call the double moral of the united states and that is going to have

consequences in terms of not just from the world in latin america but on the credibility of american policies. so what we are doing in colorado and washington is not just domestic policy. its american international policy. >> thank you. we can take to of those comments rather than questions unless you have something to add. but the first one in terms of the public health perspective in colorado there's a question. astana i apologize for jumping. we didn't have that debate and the reason we didn't come and angela mentioned this, this is an initiative. there were no hearings. we have something called the title board where you have to question people vote on and that's it. so to answer your question we didn't have a discussion on public health benefits. now, i've read a lot of this literature and i commend angeles for her good work in this area, but we don't know about

marijuana in terms of its medical benefits. everyone attorneys to admit that. once it goes through a pharmaceutical trial and we actually have the fda goes through all the tests, then we will know how to dispense it and when to use it, but this idea that we somehow know so much more about it, that we know about alcohol, we can compare them is false. we do not know. we have to figure it out. we have an obligation now. tens of thousands of people in my state with medical cards that get medicine from places like the boulevard not far from where we live but jumping up and down and saying prescriptions, no doctor required. that's the world we live and in the hypocrisy of the world that we live where we don't trust medicine and science to help us figure out what the answer should be. >> that is the point he made earlier that takes years if not decades understanding the public health ramifications. so we are just the very beginning of a very long road.

>> i propose something both of you said. i'm not against experimentation. my point was on an earlier occasion it is difficult to stabilize its, so to take the game marriage example, i totally agree with you some part of the process has worked terribly well but it is also the case that we may not get enough time to run the actual experiments because, you know, half of the gay rights community understandably not fronts around with equal protection and falls on the market and it doesn't go fast enough to jump this, right? the problem isn't totally similar in the marijuana situation. but i agree with you. you need some states that don't

go down that road. you don't want the process that's a sort of willy-nilly or states that might trouble, the enforcement costs are too high, whatever. and so that's my point. how hard is it to stabilize, compartmentalize. estimate that's asking for a lot. pacing and a way that lets you unfolded. what happened on the marriage which is interesting is although i think nine states now have legalized, a much larger number of states amended their constitution to forbid. the end is also that. people in the debate feel strongly one way or another and the results of that is to wall off a number of states but it's been to be very hard to run the experiment at a very rapid pace unless the supreme court decides to weigh in. >> what's interesting is the

states decide to pass constitutional amendment saying it is illegal and you can't change that by initiative for referendum without changing the constitution first. something like that might even have been treated to the gentleman that asked about i think the question was why is it the drug policy is immune to common sense, i will see about one. but politics from the late representative jimmy burke of massachusetts years ago said the problem with some people is they think this place is on the level. [laughter] i only ask people to bear that in mind. let's go back to more of these comments. looks like most are in the back. do you think we can get all three of those clocks keep your hand up until the microphone reaches you if you don't mind to get this back >> i would like to point out my commodore question is regarding the international implications, and i'm glad, gentlemen from the motherland pointed out.

i come from a country colin india where most people believe that the u.s. plays is right generally and therefore it doesn't really fall into the international law itself, but forces others to blackmail or follow them. given that it would be good of this regime breaks down because a lot of countries can go the way they think is right and do it the way i would like to know if that is acceptable to the united states. >> very interesting question to the estimate what is the state by the way? >> it is tempting to make the world safe even the weight is getting worse. >> we have a couple others back there. >> when you started talking about winners and losers i was hoping you were going to follow the money. as this trend plays out, well

for example but illegal marco traffickers go into profit-making, legal dmarko traffickers will the states be able to tax enough's, the trade enough to make it profitable for the states to want to change for fiscal reasons? are there other issues like that? could you address them? i don't know what they might be but i am sure that you have given a good deal of thought. estimate we have one more in the back. is that persons the -- >> yes, david would stop the drug war.com. sorry if i mispronounced that. you commented earlier that you don't think that the doj should publicly announce the policy towards the marijuana initiative i presume you hold that with regard to medical marijuana also. my question to you as a former

doj offical, what do you feel should be the policy if there should be any, and is it possible for there to be a policy or understanding internally that doesn't ultimately become a matter of public record? >> why don't you start by answering that one. >> i would say in reverse order if i may, the policy that the doj should follow is low wall and the u.s. criminal code is what it is and that is my answer to you. you have to understand that is the role to execute the law but the fundamental issue is are we going to allow this or not and that is what i've been arguing converse and not for some appointed official in the executive branch to decide it isn't accountable to anybody than to the president of the united states but not accountable to an electorate. with respect to the gentleman, i

would just say to you that it's an interesting question that you pose and if he could state it because i am not antiyearly sure that i got all of the nuances. >> let me take a shot at that. we are going to see as a result of the legalization all kinds of changes in the job market potentially. what will those look like? what comfort to legal operations and then enforcement? >> i think that is a great question, sir, and i guess i would say this. in 1984, the congress tried to take on the issues of what we know as the cartels and so on, that is the drug control act of 84. we are going to spend the drug enforcement resources and focus on the big fish. we are going to go after the organization said cause violent crime and that is going to be the focus and that is our national policy. i think it is a great policy for us to pursue and it is the mission of the dea and the other agencies that support that

effort including the task forces that were discussed and we have nothing. it's no offense to michael but on the ground that's what we do. we don't have the band is everywhere. they are strapped to the hill and there aren't many of them they do a great job, but you have to use locals and their expertise and resources to be able to accomplish anything in terms of dealing with the drug control act party. this is why we need leadership that the federal level. we will have some experience and some data perhaps depending on how the fed treats what happens in colorado but we will eventually have some place right and washington has a self executing tax, 25%, a lot of commentators already said that's too high we will see the legal activity. bottom line is law enforcement is going to be dealing with the same kind of organizations they are now. the experience in colorado is

illustrative and this is controversial but i will say it. they did an analysis of the miracle met alana -- -- to become medical marijuana. the analysis shows as it is publicly released in 2009 that well over half of all of the folks involved at that time have a prior criminal convictions from serious felonies. that is quite explosive when the news got out eventually it was disclosed and the media picked up on that. could folks who've been involved in criminal activity comfort themselves into medical caregivers, that is essentially what we are talking about and it is yes, they do. we will see that happen now. so what we are going to have to safeguard, one of the things is we are going to have a lot of folks that are good that distribution and understand this industry much better than the

mom-and-pop operators or the privateer hedge fund in silicon valley. they are now going to be focusing on how do we capture as much of the market as possible this will be a tough time for the dea for those that support and the justice department and those operations. so we have got to have a debate about what happens in terms of crime. the bottom line is there is a sense that this will make violent crime go down. i pray that that is true, but i am not at all convinced because until these extra now these are addressed and we will not know and we know that a lot of the folks that are already in the medical marijuana bill, those industries have as we have seen in the 18 states a lot of folks who are bad guys. >> can i just ask two questions that may sound paranoid, but suppose now local officials that

assist the dispensaries and the state's and sort of setting up these states and the state law prohibitions stop aiding and abetting on a similar lines and this just shows i made a paranoid of libertarian suppose these dispensaries and legitimate enterprises under the state law put their money and business accounts with some bank could the treasury then come along and tell you what you are in violation of the 15 federal laws. but if you buy the next country will make it go away. [laughter] >> fighting the answer is yes and yes.

i mean, those are the great plains and this is an issue for us to call out on the miracle metal marijuana experience. we have a whole division that does marijuana enforcement. that is what they do. i have a high school friend in that division and she used to be a state trooper and now she is in forcing states laws that regulate marijuana. she used to do what we call road kill operations. and she would seize cars and so on that had marijuana, and now she's actually enabling this, because that is with the law requires. of course federal law doesn't require any of it. is that aiding and abetting? five denney case survey and i haven't seen the prosecution against a state officials for doing this, so in a way this goes to the point you raised earlier about the defacto policies through the discretion that frankly isn't rule of law discretion. >> i'm guessing a lot of this will be decided by the court in due course. >> do we know anything -- anything at all about likely

affect the market about the legalization of the drug market? >> people will be using more and we don't know -- of their behavior is to use more and drank more there will be more crime and if they use more and drink less there will likely be less of it. what extent we've seen a lot of exaggeration on tax rates and what we can expect this goes back again. islamic the gentleman in that made an interesting point what if the treaty is all heart may be federalism is dead at the national level and the international level as well. any thoughts? [laughter] your comment by surprise on that one. >> i appreciate the gentleman from the nation's and so on. i love my country, and the gentleman from safe. we are not out to try to do something bad. we are just focused on ourselves and that's what we were doing on this issue.

i'm sorry that other people suffer. we are going to make a lot more foreign policy if we don't get leadership out of washington. that's relevant to the people that live in the territory. it won't make a lot more policy like immigration policies as well. eventually as we have seen through gay marriage we will solve that issue and that will be addressed eventually regardless of the congress ultimately decides to do. this is krin to happen in marijuana. >> i completely agree. the constitutional issues that i meant to speak to our one thing, and the attitude of go fly a kite. i'm totally against that and all limit to suggest is the international treaty obligations don't confer any rights on the united states government in the state's that they might have. >> we look to the united states leadership on these, too and this is seen as an opportunity to leave the humanity in this

regard. the state's have to see what goes on and we are going to wait given the chance to figure it out and we will share with you what we learn and let other countries think it's okay to learn, too. >> that will require a policy statement by the united states to the approach. should we get back to end early your attention? we have about four minutes left and five or six questions. do you want to do a lightning round? let's put them all on the table right here. >> i will try to make it lightning. i'm with the marijuana policy project and was one of the lead drafters of the initiative and colorado. hello, troy, how are you? [laughter] >> good to see you curious and at what you said about the 2,009

-- >> the policy makers here was passed in 2010 for the dispensaries so the owners now are completely felmy free and legitimate and what policy makers to know that. hid av not attempted to meet with the drafters of the initiative for any stakeholders. that is an inappropriate way to determine or settle the state federal conflict. >> any others here? the gentleman here. let's make an clich if you don't mind. >> kneal franklin, director of law enforcement in prohibition. we hear a lot about leadership. steve said something about leadership and since you talked about this as we have no

leadership there is this an opportunity for the president, and what is the president's latitude? i know the executive branch enforcement but what is the president's latitude, and what can he do, what can the white house do and what should he do? i'm hoping these answers get to him. >> let's go to the gentleman. we also have a couple tweets. >> i'm with the governing magazine. i want to go back to the broad federalism issue which i talked to several people that said as much as jonathan, that between gay marriage, the affordable care act and marijuana were kind of redefining federalism in a lot of ways or we could be. so i wanted to ask you and i know this is intentional, but what are the potential ramifications for the system of government depending on how the various the dates are put out? >> i love how we saved a little questions for the end.

>> ashley from l.a. is asking how many marijuana states required reading in all encompassing standards state why and how important is that? >> how many states agreed dispensaries? we won't be able to get an answer on redefining but let's come back to that for a lightning round. no meeting with the drafters of going to rule that we don't know why they haven't done that and probably it's not our place to see if that is a good or bad idea. how much leeway does the administration have to make policy without legislation as a big question and how does this redefine federalism is another big question let's take those two the any thoughts? it's a good opportunity for the parting thoughts on what the stakes are here. >> they are having to make major

decisions now that the infrastructure is expensive to do and they need some idea of what the future looks like in the response i think it is unfair. [inaudible] you know we are not free to come after you with other things, this is what we are going to give you with a free ride. >> one item to john and jonathan's list of policies that have become conflict will or social as you mentioned and have a dimension that's right to work which is huge in a lot of ways, and i think that you will be seeing two things in the coming years in america. federalism, one is the states will split and more of these issues along sectional lines and

second, among some of the states and the federal government and the other states relations will become more conflicting and i believe that is all to the good. >> will we see a hodgepodge of different coalitions or are we seeing a pattern? >> if you look at most of the issues -- i haven't followed the marijuana thing, but if you look at labor, the environment which is playing out, a variety of social and cultural issues is always important for health care which you mentioned. it's always the same coalition, the certain stability and its huge overlap is a terrific thing. >> that's very interesting to read what you're seeing is the larger process of ray reallocation both within the states as well as between the states and federal permit. troy, how much leeway as the

obama administration have? you gave an answer which i don't find satisfactory which is look just kunkel the substance act and that would be fine if you have 2 million agents instead of the number you do have that they have to make some hard choices. how much room does allow all give them to maneuver? >> they will maneuver as best they can. i think what this shows is that federalism is alive and well. the reaction is that the state's kind of wandered this concept as a tarnished concert in the country for these reasons. but it's even the term now is embraced by the new generation pcs controversy a social issues as you identified in the air being addressed in the state law and that is a good thing that is happening here. finally, i would say that, you know, it is easy when your a middle-age man to say my gosh the real flaw what are we going to do? what we have had worse moments than this. we have been for some three times as a country.

getting his young people involved in the process the way that has happened in my state and other places is wonderful to see it happen. and i'm very excited about the fact that more people are engaged. i think the debate is going to be better and eventually i think it will force congress to become a relevant and which will save us. >> the constitution is a mechanism to force conflicts after the levels of government on an ongoing basis. that's the founders' vision for how you retain flexibility and dynamism in changing world. they are bemoaning the process, failing and not working and it's nice to end on that. this is like what the founders thought they were setting up, this kind of tone or war. thank you for coming. this debate isn't over so come back for the next round and there around after. [applause]

[inaudible conversations] [inaudible conversations] >> if you would like to watch this program or any other programs, visit the video library at c-span.org/library.

>> i think that collecting of the minds of america's founding fathers is particularly dangerous because, as i say so often in the book, they were not a collective unit, and presenting them as such can tend to dramatically oversimplify the politics of the founding generation and then it comes to be used as a big batting round to beat people over the head with in ways that both

historical eight in a coherent and sound. i enjoy the capitol hill coverage because i started there many decades ago and hearing coverage live in the house and the senate and also the certain committee hearings. i think they are very informative to the public to see what happens in congress. i like the way c-span covers the fact that it's presenting itself with what's happening to be able that of commentary may be that not edited to a certain predilection. it's just what they want to present to the american people.

next, the president of emily's list talks about the success of space female candidates in 2012 and the strategy for future elections. the 113th congress consists of a record 21 men now serving in the senate. emily's's list is an action committee that helped elect pro-choice democratic women running for congress and governor. the national press club hosted this 40 minute event. >> -- and we are privileged to have stephanie schriock, the president of emily's list, speaker today. as they should after this spectacular win in the presidential election. stephanie has been very active in democratic circles. she was the national finance director for her word -- howard

dean election and now helped john defeat the incumbent in the state of montana. steny also managed the campaign of senator franken in minnesota, and she defeated norm coleman; correct? she's a graduate at the university of minnesota and she grew up in the town and here is stephanie, the president of emily's list and then we will take questions from all of you. >> thank you. thank you, all, so much for coming up and good morning.

again, my name is stephanie schriock, president of emily's list, though as was mentioned, grew up in butte montana, where my heart and soul still reside. great to be here today to the i want to thank you all for joining us this morning and give a special thanks to the national press club for having me and for setting this up. it's really an honor for me to be here today. and i just wanted to start for those of you who don't know as much about emily's list, emily's list has been around now for 27 years, and we are committed to electing pro-choice democratic women to office up and down the ballot across the country, and we did as mengin have a pretty good election cycle in 2012. but the two years before that were left for american women, and like most folks i was more

than ready to see the 112 congress end. without emily's list we couldn't have been more excited to see this new congress gaveled then on thursday. this past thursday we saw the swearing-in of the senator tammy baldwin, he elizabeth warren, and they were joined with 20 women in the united states senate, the first in our history as a nation and the senators are the first in their states to have ever served in the united states said senate so we're still breaking through the glass ceiling to be we also saw the pro-choice democratic women sworn into the house of representatives and it is quite a diverse group. we have three women that are under 40-years-old coming in and the first women that have ever

seen combat serving in the united states house of representatives in this congress. if you look just north of here we have a story in new hampshire where we have the first state in the union to have an all female delegation and governor in the country, so it was quite an item 113th congress does in fact have the greatest number of women serving in the history and i can probably say that 59% of them are emily's list candidates. it's not hard to see why a lot of folks were saying this was a year of the women. but we know that this won't be the last. we don't just make changes to the contras over night. for us this is a result of 27 years of hard work. we have been working with women in recruiting and training the women to run for office at local levels and the federal level for

27 years to build a pipeline so that we continually have young women stepping up to run for office. we started working with tammy baldwin when they were in their state legislatures, standing by them when they ran for the house of representatives and now we can proudly call them united states senators. it's not just about electing women it is about advancing the leadership through the process. we often look at one of our friends, barbara mikulski. our investment in her very first senate campaign which we should note was the first investment as an organization helped her win that seat in 1986 and her hard work and dedication and our commitment to make sure that she stays in the united states senate for those years has resulted from her being the first woman to leave the very important senate appropriations

committee. the more women that we have gaining seniority in both the house and the senate means we do have more women and leadership. dianne feinstein, the chair of the intelligence, debbie stabenow, patty murray chairs budget, we have set and when and now on the democratic side that are ranking members on the house committees. and on the republican side, well you may have seen the picture. every major committee is led by a white male. in fact there is only one woman entering a committee in the house and they gave her the administration triet so what does this mean? a lot of people ask does it really matter? what if the leadership changes the conversation at the negotiation table is? senator john laura brank tells a story serving on the house armed services committee. and when they were talking about military readiness, she and one in the white gabbi giffords were

there to ask questions about personnel and supplies but also mental health programs for the troops and their families at home, all of which is important for the military readiness. you can't tell me that if we had two or three women involved in this fiscal cliff the date that we wouldn't have gotten this done a lot faster. there wasn't an american in this country -- i was at home with my dad over the holidays and we knew where we were going to end up. we knew there would be tax increases. maybe not 300, 400 or 500,000, but there wasn't an american that thought we were going to land and women want to get this done and move forward. but republican men, and john boehner in particular, tend to want to stand around and pound their chest rather than getting things done and solving the nation's problem and i take it is time to get the speaker's gavel out of his hands and back

into the hand of a woman. we make sure congress is having the conversation is that americans are having at their dinner table every single night. and that's why voters this year wind up behind democrats and in particular democratic women across the country. it wasn't just the fiscal cliff. when you look at the last days of the 112, chris, you can see why we are so happy this conference is now over. the outrageous refusal of speaker john boehner to bring to a vote the needed relief for our fellow americans suffering from hurricane sandy is an outrage. it is an outrage. then they let the session ended without three authorizing the violence against women act. they lead a normal the bipartisan piece of legislation expired for the first time since 1994. putting women across the country at risk all because they wanted

to refuse to protect vulnerable populations like immigrants and native americans and members of the ltv steel community. and now with priorities like that, you are not going to be surprised that women share now. emily's list conducted research on independent women voters, not democrat or republican, but independent voters and battleground states and what we found was quite stunning. the women that we've been surveyed were not impressed with congress, granted that is at the stunning part. what is stunning is that 77% of these independent women voters, 77% said congress was, quote, old out of touch male politicians who don't have a clue what life is like for people like them. and i sure that if we had done the poll on new year's eve, the number would be higher than 77%.

but the women of emily's list help select to congress these incredibly new members and the folks are going to bring needed a voice is to the conversations and i want to talk out a couple. the congresswoman from arizona grew up in a family that had to live in an abandoned gas station with no running water or electricity for ten years growing at. you can't tell me that she doesn't understand what families across this country are going through that have lost their homes, their jobs and almost lost their unemployment benefits. the new member from l.i.e. and from illinois both are women that have served in combat and know what life is like for those returning from combat and nova told that it's taking on the troops and families. these are the voices that we are

going to have for years and years to come. this is why we want congress to look more like america. because we know, we know that the best way to get the progressive policies is to have an equal number of women and men sitting at the negotiation tables making decisions for the communities. and we will work every single day to make that happen. emily's list recruits, trains and supports the candidates up and down the ballot. we mobilize the national network of the women and yes, good men that are with us to stand by these women and we put programs in place to turn out the voters and in 2012 we had a historic year to 80% of the candidates won and they were just sworn in last week. we've raised a record number, $51.2 million we quintupled our

number to over $2 million or 2 million members, excuse me, in the last two years. there's great energy account of the women's leadership in this country right now. we also turned out the voters in the largest ever independent expenditure program called the women vote in competitive races across the country and by turning out these voters we didn't just elect great historic numbers of women to congress that helped elect president barack obama odd that is doing so good for the women across the country so it's pretty clear this election was about women to the it was about women candidates and donors. we heard a lot about the women's issues, some in a way that i would prefer not to hear about. we heard a lot about the women voters that made these decisions. we heard a lot of talk about the new democratic coalitions, the learning a coalition of young people, hispanics and women. i kind of like that collision.

i think that is a great coalition. but we want to keep in mind when men are not just a voting bloc of the population. women are 51% of the population. last i checked, that was the majority of the population. and we look at this last election, 55% of the women voted for president obama. there was an 18-point gender gap in this election, and for every unmarried woman that voted for romney, two of them voted for obama. this is the change that we are seeing and the women were not just the decider in 2012; they will decide for elections to come. they will decide who holds the power in this country. and some of our research from the election night and all of our electoral work in this cycle and the cycle number for we know with the women voters how to expand this coalition for the elections to come. don't make a mistake to think that this is an issue on the

election. our research shows that the economic issues mattered just as much as the social issues for these voters. 78% of the women that we polled ranked equal pay among the most important issues facing this country. that is an issue that the republicans have stonewalled, ignored, opposed, called a nuisance. last i checked, they told us we will get back to you on that. when an understanding and they rejected all aspects of the gop agenda. and we found that they were even more motivated to vote for a candidate, for a democratic candidate and a vote for a brighter future. 76% of the women that we polled reported voting for a candidate. only 16% said they voted against one. so think about that. we talked about voting against a

candidate, but they were voting for a direction for this country. note that any other issue more excited to vote for a candidate that they thought had the right priorities, which were clearly not the republicans. 89% of the women that we polled rated that this was important, that the candidate had the right priority for them. the other important thing is that the women that we polled after the election really thought something big happened in november. that this is a different election. when we told the respondents that a historic number of democratic women had been elected, 56% -- and keep in mind these are independent women voters, not democrats, not republicans -- 56% thought it would make a positive difference only 8% thought the opposite. and again, these are independent women. this is a call for women's leadership in this country.

and we saw the gop agenda and they really did understand the harm that was going to do to our rights and freedoms that we have fought for for so long. and they reacted to read de reacted by sending a group of people to washington that they felt had the right priorities. and we asked women also about the problems they had with the candidates they voted against. why did you vote against these republicans? and it wasn't just the debt or health care or social issues. they were most concerned that these candidates were going to take america back to the failed policies of the past. these independent women across the country want to move forward. they want to see a new future for themselves and for their families. they do not want to roll the clock back in this country. so when in recognized that the total mad man the agenda a five-year call it in the gop, and they didn't want it and they

rejected it. so the women voters turned out to the polls and they voted for women with the right priorities. and i say this collision is strong and going to grow because the country does feel good about spending these strong democratic women to washington and they know that it is going to make a difference. some have a historic year and we are going to use it to weight the foundation for years to come. we are in this for the long run. this isn't about an election for us. we've already been looking at opportunities for 2014. there are 38 governors at for governor seats come up for election between now and the election, and those are critical races for women and families in the country. we've already seen the priorities of state legislatures across the country in 2011 and 2012, we saw the greatest number of restrictions on women's access to health in our history.

we need to make sure that we have got good, strong pro-choice democratic women governors to draw the line in the sand. they need to be there to draw the line in the sand to protect women's health, to block voter i.d. laws and to make sure the workers' rights are protected. they have much, much to do both on the economic and health care front. the races have already begun at emily's list. we have a race right now which is an open seat in illinois's second congressional district, and there -- i can't believe i'm going to see this -- three pro-choice democratic women are running in that election right now. so this starts early right here at emily's list, and we may not notice, but this is almost exactly how the cycle started two years ago. last cycle it started with five house special elections. emily's list was involved in four of them and we won three of

them. that's what we do at emily's list. we start early. that's right there in our name. early money. we help it grow and we have already started for 2014 and don't think that we are not looking seriously at 2016 and who is going to be running them. so as we start looking at the next cycle and the cycles to come i would like to open up for questions about either 2012 or moving forward. thank you so much. [applause] >> let's have questions. and please, identify yourself and your organization. okay. hello. >> [inaudible] with the "wall street journal." you talked about the year of the women and you talked about this before for the issue for women candidates. yet since the election i read analysis for what went wrong for

the republicans and what they have to do. and even among some democrats who analyze republicans and they have all focused on the need for republicans to quickly start recruiting hispanic voters, culminating yesterday in a column by kathleen parker in the washington post. the headline was for gop learn to speak spanish. you are talking about the same year of the women. do you think that people are overlooking the importance of women in this election or is this being ignored, or has something just slipped through the screens? >> it is interesting. i have to admit i am with you on the question. i have been surprised how little we have heard from the republican party about their 18-point gender gap. that is a nonstarter. you cannot win elections with that kind of gap, and it is going to increase because the republican party continues to push forward policies that are

alienating women voters particularly independent women voters in the key constituency that they need. it comes from the bill that they continue to introduce to the fact that they put in the leadership and entire cast of white men to run the committee's it's stunning. i don't think the if learned the lesson, and i am not quite sure why that is. i would love to know. i will tell you if i were in charge of the republican party i wouldn't be handling this the same way. >> okay. other question. >> [inaudible] reached women's monthly. what is the best way that you would advise people like us in the position to help move your message forward? ..

we need to just introduce what is going on to women who are leading very busy lives. your readership, has women who have children, working one or two jobs, trying to balance everything out. politics for regular folks is not in the top ten list of the daily lives. our jobs is to make it part of the fabric. it's really important. it's important locally, on who is sitting on your school board. it's important in the cities, on who is deciding where the money

is going between safety and education. you talk about your state legislature. it's important. we need women to really get engaged in politics. truthfully, we need them to run for office. we need more and more women to run for office. we focus on democrats. one of our big focuses in our next many years is to get more women to run for the legislature and city counsel, to run for mayor's races. that's our pipeline for congress. it's also the regulations and laws getting passed everyday that are affecting our lives and the lives of our family. >> thank you. >> another questions? >> i'm katherine lewis. i'm a freelance journalist for "fortune "and "new york times" and others. in addition to -- [inaudible] at least the questions, i've also seen coverage that, you know, women are no longer this

block that politicians can expect to akhil to one orb one set of issues and in fact women didn't make a difference in the lesson because you can't women just vote on specific issues or reasons. can you address that question and sort the challenge for you and also for in general in sort of viewing women as a monolithic voting. >> i thought it was odd, i've been working in women democratic politics for a few years. we thought they were one-issue voters to begin with. 51% of the population women are very, very different in the population. what i think is really important here is that there are key economic priorities that women in this country feel are very, very ponder. and they are priorities that we are not seeing the republican

party addressing. and the democratic party needs to really lean in to some of these including equal pay. being on the top of the list. this is a huge issue. women really are feeling that things are not quite right out there. because they have to make the payment every night to make sure they have a enough food for the kids or dealing with the house payment or they have to put gas in the car. so they're feeling it. so i think for a long time folks would think democratic women and reproductive rights. well, for women it's all part of an economic future and our ability to make choices to the best thing for ourself and families. it's important and they feel it's important. i think what we have done successfully at emily's list is to broaden the agenda we're talking about but also even more importantly how we're communicated with women. i think what the biggest change

that is starting to happen is our ability to meet women where they are and talk about the issues that they're facing. not just kind of blasting them with television commercials. it's not working. i mean, you can argue it's not working far lot of men in the country too, it's really not working for women. our ability to use online programs, to have long conversations with women, not just in one day or one week, but over a year to educate and to make sure they know what is going on. that is part of, i think, our future and building the coalition. is to really be part of the education of women voters across the country. it isn't so much about one issue or series of issues. it's clear there's an economic agenda that women are looking nor the country. it's a progressive economic agenda. it's not one that is going to take us back. just like health care, they feel it is time to move forward from

debates that choice is available for us both in the personal lives and health care and now in our economic lives. it's about all of that. it's really where we're communicated can them. i think that's the future here. that's where emily's list is going to play a bigger and bigger role in years to come. thank you. >> other questions? >> yes? >> my name is tiffany. i write for "tag magazine." we i had a question for you. actually i was a women vote intern in '06. >> oh. hi. [laughter] [inaudible conversations] >> i was coming to washington at the time. it was probably the most exciting . >> wow. >> but -- we've had great luck. >> absolutely. yeah. -- [inaudible] but i have a question for you.

my colleagues and i often talk about this. we are here in d.c. and progressive. we come from states like one of my best friends is from texas. and we talk a lot about being here and being progressive where states quite frankly -- [inaudible] we feel a little bit intimidated and a little bit of outnumbered and a little bit under represented. my question to you is what advice do you have for us that are coming from states being run by people a little bit more conservative and don't necessarily represent our ideal where we want to seat country go? >> well, particularly friend in texas where, yes need to do work there. [laughter] the truth is, you have get involved. there are a lots and lots and lots of women and men who feel the same way in texas, or in virginia, or in georgia, i mean, they are there. our ability to start networking those folks to build a coalition

in the state to then find the right candidate and build up from the bottom is what we have to do. there's some great organizations in texas and around the country doing local work and emily's list as a national networking is also building up more and more at the state level. we know the changes can't all happen at congressional level. we have to move these legislature. we have to get the governorship. i say there's 38 governorship's not open for up for re-election in the next two years. these are critical. some of the worst thicks we have seen for women's neltd particular, but vote id and voting rights laws, workers rights are happening at the state level. and they are winning the conservatives a winning a the state level. it's for us and particularly, i think, women have a huge opportunity to step up and really make some change because

they can speak about what the laws do to them and their families and communities. and i've read some great activism or activist in texas for doing that. whether it's been on some of the outrageous restrictions they've put on women in access to reproductive care to some of the education. i mean, the constant education battles. we have to get more and more of us involved, and we have to talk to our sisters, because don't assume they're not with us. they may not be with us on everything. they may not be that progressive on everything. i grew up in montana. i'm not progressive on everything either. when it comes to engagement and having conversations, and trying to find solutions and bringing people to the table to do that, that is really what i think women bring an extra weight to. because we do it at home all the time. sometimes you have there bring

the kids together. i watch my mom coit for years and none of us agreed and she sat us down. we need to do this in our communities, and we have to get the women up and do in congress. we have to get more and more involved. it's our time. i really see it's our time to go this not just in government, by the way, i always talk about. that's where we focus on at emily's list. but truthfully why don't our corporate boards have more women on them? why are there not more women senior law partners. why are we not seeing more women ceo. i have meet incredible women sitting at vice president slots. the time is now. there have been report after report even out of the "harvard business review" when you have more women on the corporate board, you actually do better as a company financially. so it's our time, and we have to help each other build these

networks to move women up. and balance this all out. i think that's when we get to the best policies for our community. we have to help each other. >> questions? >> and i'm erin madson. moving forward let's say some of the -- [inaudible] at least publicly recently bob ginned l has tried to pace himself as a contraception moderate and we saw -- [inaudible] still at the same time went and certified the clinic regulations in virginia very quietly around the new year. lest say there is less publicity. how do we keep the momentum going forward? so they don't refer to the next selection? >> it is about the community -- it's about the networks. we have had such growth at emily's list. that's our ability to make sure

everybody knows what is going on and what could happen. so they may -- they may -- i'm not so confident they going to really slow it down. they may. if they have learned any lessons, they will, but what we have already seen a number of bill intros deuced in legislatures in a number of places that looked just light ones did in the last two years. and in virginia to throw those regulations through in the dark of the night is exactly what we're dealing with. but remember, it's not just about reproductive health care for the women. that's a huge piece of it. i'll tell you, it's only a social issue if you haven't had to pay for birth control. most of us, it's an economic issue to have to figure this all out. but it's also the economic issues. it's what they're doing to do in congress with social security and medicare what vast majority of folks on social security and

medicare happen to be senior women. it's what we're doing with the voter id laws. they are very hard on our senior women i cross the country seniors in general, but there happen to be more senior women than senior men. we talk about pay equity, and education and we are not even talking about child care yet. that isn't even on the agenda. these are really issues we have to start addressing and we have to start bringing them up. it's about a larger economic agenda for women to move us forward that includes access, total access to health care, but also to opportunities economically. i think that is the conversation all of us need start having with women and their families across the country. >> other questions? [inaudible]

spectacular. were there any african-american or hispanic americans? >> yeah, we actually have quite a lot diversity this year. we had -- you're going do catch me off guard. i have to remember. we have the first asian-american woman in the united senate as well as our first openly gay member of the united states senate. that was incredible. we have a new african-american woman from ohio coming in to join us out of columbus. we have continued to support -- well, we do have a a hispanic out of california. and we have supported many african-american and hispanic who won re-election this year. ly say is a this, as we look at places like texas and georgia and new mexico and arizona and florida, we now are working very, very closely with more and more women who are running for

the legislature who want to build that bench because there are just some amazing women who are stepping up and making huge changes both in the hispanic community and the african-american community. i think it's an exciting time. we talk about we always talk about diversity and we would like 51% of congress to be women. i think that's fair. i would take 50. i think that would be okay. but in that, we do want congress to look like this nation. which means it's very important for us to continue doing our work in partnership with -- it's something you'll see more of. >> any other questions? if not, thank you very much. >> great thank you. thank you so much. it's an honor to be here. we had a great year, i policy you we will see many great cycles to come from emily's list. thank you. absolutely. [inaudible conversations]

>> join us for another of our q & a programs starting at 6:00 p.m. eastern the focus on robert karo and the "years of lyndon johnson, the passage of power" he discusses the newly released biography of lbj. it's the fourth book in the johnson biographical series. he promises a fifth and final book in the future. watch it tonight at 6:00 p.m. eastern here on c-span2. you're watching c-span2 with politics and public affairs weekdays featuring live coverage of the u.s. senate. on weeknights watch key public policy events and every weekend the latest non-fiction authors and books on booktv. you can see past programs and get our schedule on our website. you can join in on the conversation on social implead sites. recently the economist magazine held the world and 2013

festival which coincides with the world in public indication. it provides reader be a global perspective on the july coming year across the sphere of business, economic, media, and other issues. a portion of the event included remarks by lynn foresters rothschild. he discussed the role of capitalism in society and how to make it more inclusive. she said the inequality problem is one of the most important issues facing the u.s. and britain. she's chief executive of el rothschild. it's about twenty five minutes. so it's my pleasure to welcome lynn foresters the executive of e. l. rothschild to join me about the capitalism discussion in society in 2013.

[applause] >> thank you. >> lynn, i should say apart from being chief executive of e. l. rothschild also the director of "economist" and co-chair of the henry jackson initiative on capitalism. that's where we're going start. first of all, why inclusive capitalism? that implies there is a problem about exclusive capitalism in the first place. >> well, i want to first thank you for including eric schmidt tonight, because when i realized i was on stage with sean and john the combined age was younger than i am. so thank you. [laughter] eric makes me feel more comfortable. [laughter] so i appreciate that. so the henry jackson initiative on inclusive capitalism is a

transatlantic, private, bipartisan group that got concerned about the feeling that maybe most people are -- too many people were thinking that capitalism was collusive capitalism. and both of us who were born in the '50s or '60s there aren't many in this room tonight, we grew up believing that we could work hard, play by the rules, and anything was possible. it was called the "american dream." and george carolyn said it's called the american dream because you have to be asleep to believe it. [laughter] we actually think that it is very important to acknowledge

that capitalism has beaten planned economies as the way to move people out of poverty and improve lives. 700 million people since 1980, have been lifted out of poverty largely through one sort of capitalism or another. but at the same time, we have to admit that capitalism in the anglo-american sense has gone off the rails a bit, and for us exhibit a. of that is the inequality rate. since the 1980s when i graduated from law school and entered the work force, you know, my dad worked two jobs, he put four children through college and law school and said this is america, you can do

whatever you want. i have that experience, but since 1980, the top 1% have had an increase in their income of 275%. during the same period, the middle class, the 60% in the middle have had an increase of 40% and the lowest of 18%, and at the same time, in 1980, when i entered the work force, the average ceo was making 40 times the average worker. now the average ceo is making 380 times the average worker, and i think the best metaphor i've seen for our problem, which care the the inequality problem

to be one of the most important issues facing this country as well as britan. they have equal kind of numbers. larry has harvard has, i think, the right metaphor for what we're seeing. he taunts american captain capitalism as the apartment block that was the envy of the world thirty years ago. where everyone wanted to copy what that was, and today that apartment block has really nice apartments, gated at the top, the middle pardon pardon apartments are crowded and damp, the lower apartments are underwater. the worst part is that the elevator is broken. it's fixing the elevator that the henry jackson initiative on inclusive capitalism is about. >> we'll get to how you fix it in a minute. will you essentially saying that the "occupy movement" was right at least in the broad focus on

the issues on the 1% of the 1% which is the distribution is even more . >> i think they are fundamental the 95% is correct. i think marching the park might not be the solution. that's why we formed the initiative. we're not politicians we're the private sector, and we believe that there are things that companies and individuals can do, and that's what we can talk about, if you want, to increase the possibility for people to benefit. for more people to benefit from our capitalism. >> okay. your co-chair is dominique par soon who is the head of mckinsey. he has interesting article in the 2013 about addressing issue of youth unemployment which is one of the things that has gone

wrong. the young people who don't have opportunities. so do you want to talk about that first? that part of the ease can ladders with young people getting on to the ladder in the first place. too use the metaphor. >> yeah. what we have decided to do was not to be a think tank and not to advice government to say what are the things we can do? and dominique's article in the "world in" is interesting. you start there are 3 million jobs today in america that can't be filled because we don't have skills for them. and mckinsey interviewed companies and 40% say they have jobs to offer but they can't find skilled workers. they predict by 2020 around the world there will be 85 million high and medium-level jobs that will not have people with the right skills. so the point is what should

business do? what is business doing? business should be creating apprenticeship. what we do at the initiative, we highlight companies that create apprenticeships and business opportunities for entry-level people. not as a part of corporate social responsibility or part of philanthropy. they know in order to survive for the long-term they need to create opportunity. royals rise, for instance for twenty five years had the academy, they pay people for the first two years to only be an apprentice. they are going to school for two years and being paid. they go through all of the decisions of royals royce then they either make it or they don't. but right now 40% of top management had gone through that apprenticeship program.

rolls royce twenty five years ago realized they needed to train people for the jobs they had to offer. -- [inaudible] has done a similar kind of thing. but we have jobs in this country, but we have a skills gap. one of the things that the initiative talks about and continues to showcase other companies that do work in the area is how to train people for the jobs. >> it seems to obvious that you would train for the jobs that companies would train the work force to have the skills they actually need. why do you think it isn't happening already? >> well, it's definitely not happening. we are not training -- in fact some people we had a long initiative here. some people in the room there. larry summers gave a perfect example how we're not teaching for the skills that we need. are there any surveyors in the

audience? there we duo! john. i'm glad we have one surveyors. we have one person who is actually able to use the trig momty we studied to get to college. but none of us before we got to college had to study probability -- i see another surveyor. had to study probability yet every day how probable is it we're going to go over the fiscal cliff, how probable is it that the dow is going to here or there? so we far long time in the country have not been training fur the jobs that are available. and in fact, you have another interesting article in the edition about michael porter did survey for harvard survey where we stand in a comparative sense in the world, and our education,

our k through 12 education is below a lot of the rest of the world. >> okay. so young people is one area of focus one part of the elevator fixing, the second area you focus on is small businesses or small to medium businesses. why is that? why does that need to be a particular area of concern and what can be done about it? >> so we're highlighting what big companies can, should, and are doing for small and medium enterprises. because fors of all, if you think for the long-term. you want to broaden your base of suppliers. so we think business in the own interest should be encouraging and helping small and medium surprises an example of this is ibm. ibm granted through the foundation in the first instance gave a $10 million grant to create the suppliers

connection. they created an internet-based place where companies smaller than 50 million dollars of revenue could log in and apply to supply different things from pencils and papers to widg et to corkscrew what it is. they brought in ups jpmorgan, about twenty companies that put the needs to the website so small business and medium businesses can expand. they account for the largest% age of job growth in our society but it is our obligation to encourage them and help them thrive. >> so -- but you're also --

there's also posh lay conflict for the large companies they create their own future competition. if the medium sized companies get too big, you're relaxed about that or they should be relaxed about that? >> i think so. >> ibm. >> we'll ask eric how he feels on facebook. [laughter] >> okay. now the third area that you focus on is corporate government, and what part of the issue that has been much talked about is an excessive focus on short termism, you think a longer term focus might be more inclusive and help bring more benefits to society at large. >> right. in the role we're saying corporations should invest for the long-term by investing in education that is needed for its' future by reaching out to

small and medium enterprises. we also need the the activity of the investor base to say we are going to invest in companies that think this way. that have a sustainable view of the world. that view their obligation to all of the stakeholders. in this pathway, we have on our task force gym leach head of on terrier teachers. they make it very clear they measure a company by its long-term commitment to the entire ecosystem of its business. the pension plan of holland does the same thing. then you have ceos who are on board like paul. he's stopped giving quarterly earning reports.

if you're interested in long-term growth. if you're interested in sphenability, if you're interested in a company that takes care of the stakeholders. buy my share. if you're not interested in them. you are a perfectly nice person, but buy someone else's shares. we think in order to have corporation to do the right thing, we need investors to do the right thing and create a virnlg l circle of inclusive capitalism, and -- i was going say that the overarching gnash we are deal with in the report and availability on inclusive capitalism.org is the issue of ethics. if people and business and in finance thought about what was right and wrong, i think that we would have less resistance to

our form capitalism today. one of the things about adam smith that has to be remembered is seventeen years before he wrote the "wealthy of nation ." he wrote another book. he was more of a moral policy for than an economist. it wasn't that he believed we were good, he believed we were self-interested. but he believed that free market and freedom would lead to people doing the right thing tbhais cared eacialt the -- because they cared about the reaction of their peers, and they cared about common value and a common feature. i think one of the things we have seen since the '80s is from [inaudible] to, you know, just incredible opulence beyond what anybody can

really justify that we lost that sense and like our parents, you know, they were "the greatest generation." they sacrificed a lot for us. and sometimes i feel like we're going the greedy generation if we don't get it right. if we don't just give people opportunity to get on the elevators. >> this is the heart of the problem, isn't it? how do you actually ensure that this really happens? because all the very long the period you're describing have been people who have preached ethics in business as well has been a big, wise at least rhetoric about corporate responsibility but is actually was reaching a crescendo just as the economic crisis hit. so how do you translate what you have been describing to something that spreads on to an international and national or

even international scale? because the forces that are pushing forces the 1% of -- 1% of the 1% are strong indeed. >> well, they are very strong indeed which is why we're almost trying to start a movement. just a movement of how in our own individual ways we can do something to help something else gate leg up. i think our political system is largely to blame for what you're talking about. [laughter] [applause] all right right. >> when you say our, your mean -- [laughter] >> god forbid your majesty's government. [laughter] never, never. [laughter] actually, no but the collusion

of big business -- i don't care if you're a republican or democrat. if you're not sick to death of people claiming that they want a smaller government taking everything from the carried interest to subsidizes for their industries, i mean, in to the pocket and they don't realize or don't acknowledge and face the fact they're the biggest reaccept yept of the coordinate welfare. the economist -- i think dan any is here. i think she wrote. we're not supposed to know who it wro it. but i know who wrote it it. in that she talked about the mortgage interest deduction which is essentially an upper middle class tax break has cost four times what we spent on low-income housing. people who take the mortgage deduction don't think i'm getting corporate welfare.

but we really are. and there was a quote by a british chancellor of the exchequer -- he said to a group of businessmen who are were coming in and saying get off my back. we have to have less regulation. he said if you want government to get off your back, take your hand out of its' pocket. >> now we're going over time. i want to ask you -- [laughter] i want to ask you one question. >> you want to eat. >> you have one question before we eat. it's a good one from that's been asked by someone at one of the tables, which is what is the role of women in the inclusive capitalism? >> oh. >> thank you for asking that. >> thank you. >> but it's not inclusive if you don't include half the population. >> that's true. that is true.

again, age. so i went law school we were just about 50%. women are 50% of college and university graduates, 50% of law school, 50% of medical school, that is a built more business school. -- we're half of the entry level, we are half of mid level. with 35 percent of the federal reserve board, but we're 14% of corporate board on the fortunate 500. we are 3% of ceos of fortune 500. we're 17% of congress. so there obviously is a women most powerful women. i think patty is one of the most powerful women issue is here

someplace. she probably asked that question. i have a sort of not politically correct view on this issue. which is, i think women should stop whining, and i think it's time we just -- in my experience, women decide not to go often. yes, there are obviously, you know, stereotypes against them, but we can fight against it. and in the world in 2013 i imagine the economist will be revealing a book called "lean in ." she's telling women, just, we can make it to the top. there's nothing in our way except ourselves. and it's not nothing, but i think that if we look within ourselves and we're ready to

make sacrifices anybody has to make to get to the top. we can do it. i was recently with a group of squad ron that received all sorts of medals coming back from afghanistan. one person in the squad ron was a woman. the person interviewing the soldier said how to you feel about having your woman as a commander and they said, actually, it doesn't occur to us. we think of her as a sold soldier. i think that we can push ahead, we can make it. >> and as you know, in europe that there's been a -- it's a live issue with the european level, there have been moves to have quota by legislation for women at the board room level. some europe countries -- norway is one actually have that. i take it by what you're saying you're against qaw that of that sort it. >> they are an uncomfortable

thing for americans. europeans are more comfortable with them. [laughter] we want to quality of opportunity more than a quality of result. that being said, i was on a fortune 500 board early in my career, they weren't -- [inaudible] people to put on. i know, for sure that the ceo of that company decided that he wanted a woman, and that's why he found me. so how to get people to think about a woman is very important. there's another thing that happens and i've been on several boards i'm on a couple of now. when the guys sit around and say we need somebody on the board. there's joe, there's harry, and mike. somebody says how about a woman they say how do we get hillary clinton? suddenly are the standard for

the woman goes to the roof. and that would be mitigated if there were are a requirement a certain% of women. how to get american boards to think more about women. i don't know. we must let people eat. so please join me in thanking lynn. [applause] join us for another q & a programs starting at 6% eastern. the focus on robert karo. he discusses the newly released biography of lbj. it's the fourth book in the series and he promises a fifth and final book in the future. watch that tonight at 6:00 p.m. eastern here on c-span2.

i think that collectivization of the mind of america's founding fathers is particularly dangerous because as i say so often in the book, they were not a collective unit. and presented them as such tends to dramatically oversimple if i and it comes to be used as a big battering ram to beat people over the head with. >> newman university and english professor what he calls the deep historical flaws by conservative commentators. he shares the view with george washington university associate professor of law david. on booktv's after words. sunday night at 9:00 p.m. and

midnight eastern time. supporters of the "occupy movement" discuss the current state of the union. the "occupy movement" began in 2011 as a protest movement against social and economic inequality with the goal making the economic structure in society fairer. m.i.t. and boston review jointly hosted the event. [applause] thanks very much for coming and thanks to the boston "boston review" and department of political science. we have four renowned panelists. i'm going to introduce them all and they're going to speak for ten minutes then we have a bit of discussion between them and move to audience discussions. okay. so first debra satz is the professor of ethics in society at stanford university.

she's also the senior associate dean for the humanitarianings and arts. she is a member of the philosophy department and directer of the mccoy family center for ethics in society and the research focuses on the ethical limit of the market, the place of equality in a just society, and theory of racial choice. she works on the feminist philosophy, ethic, and education and issues of international justice. she's coed or it of the occupy future. nadeem marzen he's a smawdz owner. ceo of a company a boston-based interacting marketing boutique special idessing in web app and design and co-founder of dangerrer awesome a laser cutting shop. he continue to be engaged in outspoken human rights abuses,

and finance industry mismanagement, next is phil thompson. an associate professor. he's a social professor at m.i.t. department of urban study and urban planner and political scientist. he worked as deputy general manager of the new york housing authority and director of the mayor's officer of housing coordination. he's a frequent adviser to trade unions. he's the author of the "double trouble "and currently writing a bock on community building and development since the 1960s. finally chris hedges with awarded in 2002 a pulitzer prize as part of a "new york times" team of reporter who covered global terrorism. he spent almost two decades as a foreign correspondent first in latin america and later at "the

new york times" bureau chief in the middle east. he's the author of many books includes "days of destruction," war is a force that gives us meaning and the best selling american fashion. she's current lay columnist for truth dig and a senior fellow at the nation institute. welcome our panel lists and let's start with debra. >> okay. thanks to "boston review" for organizing this event, and i'm happy to be here. i'm going to talk about the "occupy movement" the the role of research that the stanford faculty engages in. i'll talk about that. connected to occupy and i'll talk about what i think occupy accomplished and the future. -- can i bankrupt a second. i think as a guiding question, we can ask what were the root of the "occupy movement"? and how far did it go and is it continuing to go in providing

the injustices that gave rise to it? sorry. >> yes. you were . >> let that be. >> yes. that's the theme for all of us. to ask all of our panelists to comment on. from the gipping, in to the park in 2011, the "occupy movement" scintdly raised awareness of the glaring inequality that characterize the american society and gal van galvanized form of public response. a series of largely uncoordinated sit ins teach in, and protest were held. citizens came together and inspired banner. we are the 99%. what is important about that, many things. but one something was that it was the actions articulating a growing sense there had to be an alternative to the status quo. and therefore should be understood in part as protest against the poverty of political

imagination in the face of the economic crisis that swept the country and the globe starting in 2008. occupy opened up a wedge for changing a conversation and ultimately a distribution of politics in the country. and it was this idea that it was a beginning something began. it was a wj. sometimes it's just important that something bins and part of the importance, i'll come to this about occupy is something began. a group of faculty decided to add force to the wedge by turning their various expertise, we were a group of political scientist, sociology, policy for, artist, and and literature professors to add force to the web by developing a narrative that would undercurrent the

broad concerns raise by the occupiers. it's one thing to say inequality. there's a lot of growing inequality and questions about what makes it bad why did it happen? what can be done to combat it? so about thirteen of us issued daily short articles on different topics related to a couple of issues i'll talk about. we wanted to explore the roots of the crisis, and to explore the resources we have for renewal of economic and political democracy, what raymond williams helpfully called resources of hope. and these essays were published online in the boss to ton revue view and soon to be publish by m.i.t. prez. the central to the root and

cause of the "occupy movement." so first is the deep and growing divide between the have and have not in america. of course mlt. area of life. we see the greatest inequality in the united states is known since the great depression. in this sense, we are the 99% is not just a clever rhetorical devise, it's consistent with data that shows only the top 1% of wage earners have seen their incomes rise over the last decade, the negs two to five percent has experienced flat wages and everyone else has seen a drop in earnings. the trend toward increasing inequality has been going for thirty years but reached unprecedented level. the top 1% is claimed nearly all the growth in income over the past twenty years. sour essays sought to clarify

the trends and explain them in prose that would be available and helpful to people. and so analyze the causes of the growing inequality. it's one source of the "occupy movement" is this growing inequality. but second issue that occupy respond to is, i think, as important if not more important than inequality in itself. that's that the extreme inequality is rooted in and self-fuels corruption. governmental interventions that favor the rich, lack of accountability regarding those who recklessly lead us to the economic crisis, and a shall low commitment to readdressing the disadvantaged faced by those unluckily enough to be born to pouf poverty. we claim to be a country committed to fair contest which everyone has a equal opportunity get a job and get ahead. if you work hard and play by the rules you'll lead a decent

life. instead we find the government bailing out rich and ignoring the revs of the country. we now seem to take for granted educational inequality in which poor children are badly educate or unqualified for college and increasely consigned to low earnings. and if the deck is rigged against the poor. we look away as ceo cut sweet heart deal that cut extraordinary compensation even as the firm fail. the problem isn't just extreme inquality. it torch that inequality is the product of corruption and inequal city -- it's the second source for the "occupy movement" and a second point of its roots. a third, root concerns that the crisis? our government in democracy. meaningful democracy can't exist

when money interest can buy election and can lobby in ways that buy legislation. so for example, two-thirds of americans support increasing taxes on the top 1%. but in id logically extreme faction in congress sported by money interest is committed to blocking reform in the area. add to the list concerted effort to restrict or eliminate collective bargaining right of union to deprive people of the right to vote and you appreciate full measure of the democratic crisis we face. fourth and final issue, is the challenge of finding a way to manage the economy and provide a good life for everyone that is environmentally sustainable. no solution to the problems of climate disruption can be found that doesn't involve the developed world reducing the level of carbon emissions. so these four issues inequality,

corruption, crisis of democracy, sustainability, fueled the "occupy movement" and with a we try to do was to explore and analyze the margin of and to see what could be don to bring our institutions to better alignment with solutions we also wanted to bring these four issues together in a narrative. and we choose in to root our narrative in american ideal of freedom and equality. to say that the ideal of freedom inequality the some of the founding ideal of the country for a lever for which to think about the four issues and begin to identify where we fall short and in our book we try to take up some solutions including a millionaire's tax, financial

regulatory reform, and reform to the electoral college. i said one of the things we want to do is take the weblg that was begun by occupy and press on it by developing a narrative in part because we thought that having a are narrative something beyond just a slogan would actually a narrative you could begin to take out to deepen an make assessable to a broad public. it's a critical part of the story of successful social movements. and so that's what we try to do, but there was some things we couldn't do that occupy did, and i think this is -- i'll turn to what i think was the value of occupy and where i think it's going in my last two minutes. so what occupy did was it began, and i can't understatement the importance of the action of the beginning to basically show us

that the search for opposition is infutile. you might say, well, it's infutile some people think where is occupy now a year after? so i want to jo say quickly a couple of things about why i think it's premature to write the obituary of occupy. i think occupy was a beginning. it's not an ending. there's a lot more to be done. i want to say why we shouldn't write the obituary. first, there's significant actions being taken by people inspired by the "occupy movement." i'll mention one. strike dealt which is an organization started by occupiers, which has been buying up -- something called the rolling jubilee where it buys up debt and cancel it ises it. there was occupy fcc. occupy still goes on. second and most important,

significant social change in the country is never come simply by conventional politics. it never comes in a straight line. it's never a simple story of movement, you know, yielding successful success every social movement has seen ebbs and flows starting with the grade antislavery movement begun in the 1700, which nobody would have ever predicted would have ended slavely a hundred years later. the civil rights movement saw ups and downs, so i think that it's just important always know that social movements are not simple narrative arcs of one success after another. it brings me to the last thing i want to say, which is in the end the "occupy movement" isn't about occupying parks or public space, it's about coon fronting

enormous challenges that we face in america and in the glow, if we don't confront the changes we won't have a future. one way of thinking about maybe the history of the ebbs an flows of social movement to say we can't -- the social science that writes the demise of the movement. there's always a gap where you can have hope, that's the importance of the beginning of the "occupy movement" is it actually is a source of hope that people responded and -- to the changes in the country that really show that there are cracks that can be exploited. i'll stop. thank you. >> thank you, debra. okay nadeem. >> she actually took my answer. that's what i was going to say.

>> actually there's good overlap. i guess i'll talk about my experience with occupy and probably start off with the general occupy disclaimer that, you know, it's been a long time since i was involved in occupy and in general when people from occupy talk they speak on their own behalf not with any special knowledge or authority over the rest of the group. but my early dais started in boston when we came together on the bandstand the georgia disee bow in the park downtown in boston and tried to imagine when we would do this and how we would put it together. two groups kind of vied for putting it off six to eight weeks. new york had taken months to come online. there were a lot of planning or should we start on thursday. two or three downs the road? the group that said we said we should start immediating ended up winning out. i think someone said at the