housekeeping here. these incredible people don't stop. tomorrow at 9 a.m. at kennedy king college there is a congressional black caucus presents the health brain trust of making good health my reality. congressman bobby rush, congressman danny davis, congresswoman robin kelly and donna christianson will all be be there at 9 a.m., a town haul on health at kennedy king college. i would say this, i want to thank congresswoman sheila jackson lee, congressman bobby rush, congressman danny davis, congresswoman robin kelly, congresswoman corrine brown who had to leave for being here, but most importantly as congressman davis said, i thank you all for being here. in the spirit of congressman rush and mr. davis' childhood story, on august 28th he asked

us would we commit to a day of nonviolence in the city of chicago and across this nation. be and as congresswoman kelly said, sometimes you feel a reacher to the choir. i think we know the answer to that question. but in that spirit and leading us in a celebration of positivity for the end of the evening, if you will commit to that day and to every day, would you please stand up? well, let's have a safe evening this evening on friday. god bless the city of chicago, and god bless these united states of america. thank you so much. [applause] [inaudible conversations]

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[inaudible conversations] >> there are 1e6r8 -- several live events happening today. the senate armed services committee will head a couple of nominations. we'll join that hearing on c-span in progress at 10 a.m. eastern. also at 10 a.m. on c-span3, the senate banking committee will hear from mary jo white, the head of the securities and exchange commission, and gary gensler who heads the commodities futures trade commission. and later on c-span3 the senate energy committee will hear from energy secretary ernest moniz on what to do on nuclear waste. that's at 2:30 be p.m. eastern. >> when did we reach a point where you have to have a certain

philosophy because of the color of your skin? [applause] when did that happen? you know? [cheers and applause] you know, a reporter once asked me why i didn't talk a lot about race, and i said because i'm a neurosurgeon. [laughter] okay in they thought that was pretty strange. and i said, you see, when i take someone to the operating room and i cut the scalp and take off the bone flap, i'm operating on the thing that makes that person who they are. the color doesn't make them who they are. when are we going to understand that? [cheers and applause] >> surgeon and author ben carson takes your calls, e-mail comments and tweets in depth three hours live sunday at noon eastern on booktv on c-span2. >> the president's chief economic adviser says defaulting on the debt would be

unthinkable. politico's mike allen spoke with alan krueger about a week before he returns to princeton university. [applause] >> thank you much for coming in, really appreciate it. thank you so much for coming out on your final week as a member of the president's cabinet. you've been there almost from day one, alan krueger was chief economist at treasury for the first part of administration, and then you went awol, is that what they call it? >> i called it sabbatical. >> okay. so a little sabbatical. what'd you do? >> i went back to princeton university to teach. >> and then came back to be chairman of the president's council of the economic advisers. playbook we always start with the news of the day, and washington -- especially with congress in its final week before it dose on its own swat -- it goes on its own sabbatical -- everybody's wondering september 30th, are we going to have a goth shutdown?

and we've started to wonder, you know, this administration always feels like republicans don't listen. you only have so many levers for making relins listen -- republicans listen. i wonder if this administration wants a goth shutdown. >> mike, clearly what the administration wants is what's in the interest of the middle class, and it's hard to see how a government shutdown is in the -- >> okay. so how do you make republicans listen? >> well, the president's doing his best. you know, he last week went to galesburg, illinois -- >> he did? i haven't heard much about that. >> then he went down to jacksonville, florida. i went on that trip with him. tomorrow he's speak on johns and the -- jobs and the economy. he's certainly focused on the number one problem facing america today which is providing more opportunities for people to get into the middle class s. we try to make the case as best we can to the american people and to congress. >> so the government will shut down if what?

>> no, i'm not going to negotiate. >> you can talk about that. >> well, you know, again, let me just make my point that the president is looking to use every lever he can to strengthen the middle class. he's put forward proposals that would strengthen the middle class and has in statements of administration policy that are issued discussed which bills he would veto and so on. that's probably the clearest expression of where the administration is. but these are all avoidable problems, you know? there's no reason why the government should shut down. if congress is working in the interests of the american people, these problems should be avoided. >> okay. about the same time, shortly after that september 0th spending -- 30th spending deadline, probably mid november the debt ceiling, which we've technically hit but there are ways around it, becomes a real

emergency, real issue in november, december. what will be the consequences of not raising the debt ceiling? >> first of all, on the dates what treasury has said is after labor day, and it's very hard to pinpoint the date at point. when i was at treasury, one of the things i worked on was looking at the forecast for when we run out of funds be under emergency measures. we've already surpassed the debt ceiling, and the deeper you go into the emergency measures, the more it puts the recovery at risk. the idea of etch radioing the debt -- of reaching the debt limit is unthinkable, and i was thinking about in this sci-fi movie that you probably saw, sharknado where you have sharks landing on people's heads. i think if we cross the debt limit, it would be worse for the financial sector. [laughter] >> and how is that? >> well, to be really blunt about it, you know, our entire

financial infrastructure depends on treasuries. and the idea that the government would be choosing, picking and choosing which bills to pay, just the idea that that is being contemplated by some members of congress i think is very unhealthy for the united states economy. >> one of the biggest decisions this president is going to make this year and arguably of his term is who the next fed chairman is going to be, who's going to succeed ben bernanke. your former tennis partner, hans nichols of bloomberg, wrote today that among the supporters in the west wing, the allies of larry sommers, the president's former treasury secretary, for that job. the two sort of known favorite candidates janet yellen that we've currently got as vice chair and larry sommers. among the allies in the white house for larry sommers are your successor as chairman of the council or economic ad visors,

gene sperling, the president's economic adviser. the trade adviser, mike froman, and -- [inaudible] can we add your name to that list? >> you know, i'm not sure that it's really helpful for the whole process for names like that to be out in the public. people should speak for themselves. i think everyone that you mentioned follows the ethic that whatever advice they provide to the president and to others remains confidential. that's something that i'll certainly adhere to. >> and so that's a no. [laughter] >> i think you can take that as a no comment. >> so knowing the president, what qualities will he look for in a fed chair in. >> i could just point you to the comments that the president made last week in an interview with jackie collins of "the new york times." you know, he's d. >> and michael scherrer. don't leave out mike. >> i apologize. i don't remember who asked the question here. but, you know -- look at the transcripts. he's looking for someone who sports the fed's dual mandate,

someone who recognizes that the actions that the fed takes affect ordinary americans. also who has the judgment to know the right balance between supporting the economy and possibly overheating and and inflation. those are the kinds of characteristics that the president mentioned. >> so tomorrow when the president travels to chattanooga, he's going to be appearing at an amazon distribution center. amazon today announced a bunch of new hiring in the united states. we're told that the president is going to announce some new policy on job creation. now, some of you may have heard on charlie rose's new friday night show, "the week," that it's a little bit like charlie brown and the football. the press keeps being told there's going to be a new policy, we go to knox college, there was no new policy. are we going to hear something new from the president tomorrow in. >> the president's been really consistent -- >> in not giving new policy.

[laughter] >> the president's been consistent in fighting for policies and act actions that don't involve congress to help the middle class, and i am confident you'll see him do that tomorrow. i don't want to front run the president's address, but i think what you'll see the president emphasizing the steps that congress could take today to strengthen the middle class. >> okay. so to do a little labor economic speed round here, a real worry in the country has been the labor force participation, that the number of people working full time, seeking work, trying to get back in the work force has declined. is that coming back, or what are your concerns about that measure? >> so as a labor force participation rate peaks in 2000, and it edged down in the 2000s, and then it fell rather sharply. the council of economic advisers had predicted that starting in 2008 with the retirement of the

baby boom we'll see a gradual decline in labor force participation because of demographics because we're getting older as a country and older seem tend to participate less, even though that's the one group that's seen a rise in their participation be rate, that will tend to dominate. so on the one hand, you've got this demographic trend taking place which will continue to take place unless we have comprehensive immigration reform which would push in the other direction, and at the same time there are people who left the labor force either to go back to school and get further skills, or to take care of the house. and some of them are coming back to the labor force. and we've seen that over the last couple of months, the labor force participation rate increase. i suspect what we'll see is a tug-of-war between those two forces between demographics and encouraged workers, workers who are coming back because they feel that the job market is strengthening, and on balance those will roughly cancel out. that's, i think, what we've seen over the last year and a half or so. >> so the rise we've seen in the

participation rate will flatten out? >> i think if the participation rate stays constant, that does mean there's an increase in encouraged workers because that's pushing against the downward trend -- >> putting aside the trend, the besides working age people not in the work force or not seeking to join the work force is a real sign of some of the diminished ambitions or the sort of restricted ambitions that americans are feeling. >> i think it's a sign of how deep the recession was. and, you know, even before the recession, as i mentioned, we were seeing a decline in labor force participation. particularly among young people. now, some of that's not all bad because school enrollment has increased, and i think that's important going forward. where we've had a long-term trend in the decline in labor force participation is older men. by the way, i used to write for the be new york times, as you know, and i wanted to write an article probably around 2005 about why labor force

participation was declining for middle-aged men. and i called this, by the way, the kramer effect. if you watch seinfeld be, you can never figure out how kramer supported himself. [laughter] we know he was not in the labor force, he was not actoffly looking for a job -- actively looking for a job. so i wanted to know how men in that kind of situation or were supporting themselves. so i went to offtrack betting in new york in the middle of a workday, and i interviewed people. and i still haven't come up with the answer. but that's a challenge that we face, and it's a serious challenge along with long-term unemployment which was made worse by the recession. >> and also suggested there's a lot of people in america whose hopes and dreams are not being realized. >> i think that was a title i gave to a speech recently. i think, you know, the president makes really clear that the reason why he ran for office in the first place was because the economy was not providing enough

opportunities for people struggling to get into the middle class because the middle class has been battered for decades. that's continuing even as the economy's recovering. that's why i think social it's o important now that we have cleared away much of the rubble from the financial crisis that we focus be our attention on what we can do to strengthen the middle class and to provide more ladders of opportunity. >> our penultimate question on the labor market period round here, the shift of jobs to the service sector. that's good, that's bad, that's inevitable? >> probably all three. and that's not -- >> [inaudible] >> that's not really a dodge. it's happening in part because productivity growth has been so fast outside of the services, namely in manufacturing. that's been going on for years, and that's a good thing. that makes our society richer as long as we can handle that transition. be it's good that we've had a sector that was vibrant and that was developing new products like

the internet and providing opportunities, and it's bad because the service sector doesn't pay as well or offer as many private sector opportunities by and large. now there are, obviously, exceptions. so i think it's all three. what we need to do is harness the forces that have been affecting the job market and use them to a greater extent to our advantage to try to bring more manufacturing jobs back, take advantage of the tremendous productivity we have in manufacturing. be -- to improve our tax code so there's not incentive to ship jobs overseas and make it more neutral, more efficient. to provide workers with the training that they'll need in a high technology global economy. >> some people find the penny on the sidewalk, a lucky quarter. tell us what you found on the sidewalk right here. >> right in front of the mayflower hotel, a guitar pick. >> okay. [laughter]

so in june at the rock and roll hall of fame in cleveland, you gave a speech that was called rock and roll economics and rebuilding the middle class. what does rock and roll have to do with the middle class? >> first of all, let me give you this as a token of my appreciation. >> thank you very much. [laughter] >> the speech i gave was kind of a follow-on speech to a speech i gave a year and a half a ago where i wanted to draw attention to the forces that have been watering the middle class for the last few decades, and you can actually see them within the music industry. the music industry has become much more of a superstar industry. it already was -- >> pause and tell us what you mean by, you mean something very specifically by the determine superstar industry. >> sure. interestingly, the idea of a superstar economy where a very small number of people take home a large share of the rewards goes back all the way to alfred marshall in the 1890s. marshall was trying to explain

why the salaries of a small number of business people were growing very rapidly, and ordinary artisans -- including singers -- were flatlining. and his explanation was that because of changes in technology a lucky -- he included both luck and talent. a lucky and talented business person can command a much bigger market that they can dominate a market to a much wider extent than was the case previously, but for a singer as long as the number of people who could hear the singer were limited by those who could fit in the room and hear her voice, their incomes would never rise at the same rate. and he used that as his example. he actually used a woman named elizabeth billington, who i'm sure you never heard, who was the most successful soprano in the early parking lot of the 9th

century and never made very much income compared to what the business people were making in that day. and i discussed some research i had done in a field that i called rockonomics about the forces that have been affected the music industry where we've seen the top 1% go from taking home 26% of all of the revenue in the music industry in the early 1980s to 56% today. and the same type of thing has been happening in the job market writ large and the economy writ large. the top 1% went from taking in 10 percent of national income in 1929 to 20% today, double their share. and i think it's because of a related set of factors, because of technological change, because of globalization, because of luck, and i also tried to emphasize the role of fairness, that we've had an erosion of the norms and institutions that

enforce fairness in the economy. the minimum wage was eroded. we've had tax policy that was tilted towards the rich. so all those factors have conspired to reduce the incomes of people below the top 1%. >> one thing that people in this audience, playbookers are interested in is how ideas spread, sort of viral marketing of ideas. and a very interesting slide that you had during that speech at the rock and roll hall of fame was you said the belief that a song is popular has a profound effect on its popularity even if it wasn't truly popular to begin with. tell us what you meant by that. >> this was a fascinating study. a colleague of mine at princeton named matt and a sociologist from columbia named duncan watts did an experiment where they enlisted about 45 bands, unknown bands to put up one song on a library on the internet, and

then they had roughly 10,000 people listen to this, download music that they liked, and they showed a ranking from post popular to least popular, and they ran this for several weeks. then they did something a little wit devious, they flipped the order, and they said that the least popular song was the most popular and vice versa, and then they ran this with another sample of thousands of people, and they looked at what happened. did they return to the original ranking, or did the fact that they said a lot of people liked this song mean that its popularity rose? and what they found was that the song that was ranked at the bottom when they said it was the highest ranked one actually became the most popular. >> what does that tell us about human nature? >> well, it's not news that it suggests there's a lot of herd behavior, that there's a lot of imperfect information especially when it comes to cultural goods where there's objective opinions, subject judgment matters about what's popular.

by the way, it dawned on me that another way of explaining about the role of luck is the movie searching for sugar man. it's a wonderful movie about six-toed rodriguez who was a commercial flop in the united states and turned out to be the most popular singer in south africa without even knowing it. so timing matters a lot. i had lots of examples of bob dylan being turned down by a recording studio or elvis. and i think in a winner-take-all, superstar economy chance matters a lot more. if the gap between the best or those who are perceived to be the best and everybody else expands, that means that the chance factors that help somebody to become ranked at the top matter a lot more for economic outcomes. >> all right, mr. chairman, you are the godfather of rockonomics. are you interested in rock? >> i've become more interested in music. i got started in this because i wrote a piece in "the new york

times" on super bowl tickets. i took my dad to the super bowl in 2001 when the giants were clobbered by the baltimore ravens, and i wrote an article about lessons from going to the super bowl for economics. and i was invited to be the keynote speaker at the concert industry convention, invited by poll star magazine, and i told the man who inviolented me, i know nothing about concerts. the only concert i had been to in the last decade was n' sync because i took my children. [laughter] i said i need ear plugs because they're so loud. he said, don't worry, we can help you, and he gave me data on 900,000 concerts that took place in north america, and it was fashion that iting to study the industry. so since then i have go to many concerts. >> and last question on rockonomics, one observation that you made many your original paper in 2005 was that it was live performances, that it was

the concerts where the money was being made. is that still true? >> that's still the case. i was generously called this bowie theory after david bowie. i figured he needed a plug. [laughter] david bowie said that pretty soon music is going to run like electricity. it's going to be available for free, and the only unique experience is going to be going to concerts and that bands ought to be prepared to do a lot of touring. so i think that's what's been taking place. and you could say, you know, raise the question in the old days why didn't the bands charge more for the concerts? because we've seen concert prices rise even faster than health care inflation. and i think the reason is that the concerts were kind of a loss leader. they provided to perform concerts more popular some were albums, but now since people can download music more or less for free, they're viewing concerts as a profit center. >> do we have an education

bubble? >> i worry -- >> thinking about it as future employment of. [laughter] >> identify -- i've actually said if we are to have a bubble, that's not a wad place to have one -- a bad place to have one. if you look at countries that have done better dealing with the global forces that have been affecting the u.s., they continue to increase educational attainment. in the u.s. we kind of plateaued in the '80s and '90s into the mid 2000s in terms of college enrollment especially among men. so i think it would be healthy for the u.s., helpful for the u.s. if we approached education more like south korea does and put in more resources, more time, devoted more effort to homework, to tutoring and all of that. at the same time, i do worry about student debt rising very quickly, and in some pockets of

the education system, i think there's cleary a problem. lack -- clear wily a problem. lack of information at a minimum is part of the problem that students don't know what it is that the typical student who dose to the school -- goes to the school gets out of that school, and that's something we've been trying to address by providing more information and some clear guidelines. >> a friend who works on capitol hill said that every single business person who comes in from their home state to talk to them expresses concern about how the affordable care act, obamacare, is going to affect them. i know that it's your view that the stories about all these suddenly pushing people into part-time work, i know it's your view that this is some anecdotes, not a widespread problem. but the concern is inarguably widespread. what do you do about that? >> well, i think there are probably many reasons for the concern. i mean, on the one hand you have anti-affordable care act forces spending four times as much

money criticizing the law and advertising as you have supporters -- >> talk about business people that are looking at their own house and are worried. >> well, certainly some are. but the vast part of businesses that provide health insurance have been seeing slower growth in insurance premiums. so i think when they take a sober look at what's been happening to the health care market, i think they'll see some advantages. so that covers, you know, the 85% of people who already have insurance. the small businesses, under size 50 who are not required to provide health insurance, quaff for subsidies -- qualify for sub si dies. so that will make them potentially better off and also the exchanges which have for all of the difficulty getting them off the ground in part because of some states not being fully committed to running them well, have been providing in cases

much lower insurance premiums. so i think when you look at the picture as a whole, there are many economic benefits that can occur from the affordable care act. pleasure and when it comes to employment, the president's legislative aide would also say to me, alan, how many jobs have been created since the job-killing affordable care act? it's 7.2 million jobs have been created since aca passed. that's a rate which is double the private sector number of jobs that were created in the first four years of the previous recovery when there was no affordable care act. so the kind of prima facie evidence is that job growth is proceeding at a faster pace than in the last recovery. and when we look at part-time work, while i have no doubt that you can find some examples of companies who have been cautious with work hours, overall the -- >> wait, cautious with work hours, that's a really sugar-coating way to say it. >> well, i don't know because i haven't looked at what their

actual records are. you can certainly find anecdotes in the newspapers about some businesses saying that thai going to cut -- they're going to cut work hours. we don't see that nationally, and i don't think we will. i'll tell you why, mike. if if you look at the data, we have about 145 million people working in the u.s. today. of those who are working between 30 and 35 hours a week which is the group that you think might see their hours reduced below 30, of those only 1.4 million don't have health insurance currently, work for a company that has over 50 employees. so the universe is not enormous, so i don't think that this is going to have macroeconomic effect, although it has been clearly something that's attracted some news stories. ..

>> instead of job growth at 200,000 jobs a month so far this year, which is the best start to years since 1999, we were seeing job growth which was much lower. the coverage would be very different. so we are just focused on improving the outcomes. and i think so for the outcomes have been quite positive. >> last question on this. are you worried about what's going to happen with the affordable care act as everything sinks in? >> i guess my main worry is that congress won't provide sufficient tools to implement the law. i think that and concern about

some states, kind of fighting the last war. i think what you're seeing and this will become more and more apparent is the states that have done their job and taken implementation seriously are seeing more competition, they are seeing prices come down here and that's going to be very beneficial for citizens in those states. >> you worked for the labor department under president clinton, right, and you been in the economic inner circle of this administration almost the whole time, first at treasury and now as chairman. what is the culture of this white house? >> i think the culture of the white house really, him and it's from the president, which kind of have clear eyed, cool look at the issues, looking at what's in the interest of the american people. no drama. and that's an environment where

i have felt very comfortable, so it was the way treasury operator when i was there under secretary geithner and that's how i felt working for directly for the president. >> one of the president's management style over leadership style? >> i can tell you when it comes to economics, president has outstanding tuitions about economics and is very well read. you often point out things, articles to me has read that i need to go read. >> i guess you do. >> and i do. i do my homework. and the difficult, the difficult i've had when i worked at treasury, i knew what the treasury secretary's portfolio was, and that was during, particularly tumultuous time during the financial crisis. the president has many other issues on his plate so i try to be judicious in not overloading him, but providing them with information that i think he needs most.

i've enjoyed being an advisor. it's a funny thing, as a professor, you have completely different life. as a professor you write articles and to try to discover new things and blow them to the rest of the world. as an advisor it's necessary to be discreet. as an advisor it's necessary to be mindful of your principles time, and not take up more time than is necessary. and to anticipate what information the principal needs to sometimes that information already a table. sometimes you have to develop it and have staff to research. there are different skills i found by really enjoyed working for the president. >> what kind of articles does he point out for you? >> economic articles that he comes across. sometimes academic articles, sometimes articles to the press. >> what kind of meeting does he

run? >> very organized. i don't like to tell many stories about many professors but it won't. the first one awake and i got a call beforehand saying, unlike many of the president, president obama likes to start his meetings on time and affect sometimes they start early. and i was reminded that tom cochran, the coach of the new york giants used to find the players if they didn't show up 15 minutes earlier than the meeting was scheduled for. they advice we show up 15 minutes early in case the meeting started early which was a total change of pace for me. >> when the president announced, he said he wants you to give him unvarnished advice. is that easier said than done? >> i'm glad you remembered that. what he said was i rely on the council to get the unvarnished objective advice about what's the best thing to do for the economy. not influenced by politics. it's not too hard because it will sometimes it on the one hand, on the other hand. and what i've tried to do is what i think is the best

economic evidence, but also characterize where the whole profession is. you know, it's other people have a different view, to try to explain where that is. and i think that's worked pretty well. also, i've resisted the temptation to give advice about politics. there are plenty of people who know more which -- who know much more about that to me. that's the job. i try to stay in my lane and give the president of get to the economic advice. >> has the president given up on getting a brand -- a grand bargain that would do with long-term entitlement problems? >> the president's last offer to speaker boehner is still on the table. the president has said there are many ways we can solve our problems. i think he had a very sensible, balanced compromise on the table to address our fiscal problems, but he's also said if we have to do this in pieces we will do it

in pieces. it's too much for the congress to do in one grand bargain. i think what's important is that we have a grand bargain for the middle-class, now that we've cleared away the rubble from the crisis we could start addressing to a greater extent the structural problems that have been building up for decades. and i think that's what a large extent the election was about. >> in the president's 2011 state of the union address, one of his biggest applause line, you were in the chamber for this i think in the first or second row, one of the president's biggest applause line was he said we, referring to the country, he said we do big things is the long-term endowment problem interfering with constraining, eliminating our ability to do big things? >> i don't think it currently is. i think it's a looming problem. i think right now the dysfunction in congress is what has prevented us from doing some of the big things.

i went in the time i was out of the government, i went to visit the panama canal. and to talk about seeing big things america has accomplished over 100 years ago. i went with the president when he visited the port of miami, which is expanding to be able to accommodate the larger ships that will be able to come through the panama canal and you see a tunnel under the city of miami. we still can do some big things. we would like to do a lot more big things, and i think the constraint that we face now as in the opposition in congress, not the fiscal situation that we find ourselves in. i think that's a problem more over the long term and it's one we sorely need to address in the long-term to preserve room for the investments that are necessary. >> mr. chairman, in the state of union address two years ago the president said this is our generations sputnik moment. one metric research, i.t., especially green energy

technology within 25 years our goal is to give 80% of americans access to high-speed rail. that's a tall order. how are we doing? >> i think we're doing a lot better before the sequester, and the sequester is having many adverse effects on the economy. it certainly is hurting the vulnerable, cutting benefits for the long-term unemployed. cutting the number of students on programs like head start. but another thing it is doing is cutting critical investment. and if you look back at history of the u.s., it's very hard to know where breakthroughs come from but we do know that the more people who are looking for breakthroughs, the more breakthroughs we give the example i like to have in mind is the hydraulic fracking and horizontal drilling. horizontal drilling was developed in large part because of research at the department of energy, promoted by the department of energy. it's the best example of government investing in new technology and private entrepreneurs taking it to market and developing it.

couldn't happen with any other place. we are much further ahead than the rest of the world in terms of horizontal drilling. those are the types of investments that are getting cut as a result of the sequester, and that's going to affect us in the future. >> in just a moment i want to bring you come in the audience, please ago, we'll bring you a microphone. while we're doing that i'm going to ask you about in the treasury department, right after the meltdown, when you are trying to avoid a worldwide depression. what was it like? your comfort zone with jobs, but you had to get way beyond that. >> i like is it was all hands on deck. we were facing unprecedented problems. my background in economics it with a focus on labor economics is fairly broad, so i felt comfortable dealing in skills outside of labor economics. you know, we consider issues of adverse selection immoral hazard outside in labor economics and

survey those are big issues in the financial markets. but the range of issues that we are facing, the decisions that the president treasury secretary had to make on a daily basis are really extraordinary. our member one day when the life insurance companies came in for t.a.r.p. support and it felt like a big joke of the us economy was on life-support. -- a big chunk. when i reflect back on it reminded how much progress we've made and how dark the process were at that time. >> how dark were the? what was your word at that time? >> i was very worried about -- let me give you an example. you go back to the president's first budget there was a reserve fund of an additional $250 billion for additional financial stability programs. if necessary. we thought enough to put in our budget -- >> translate that. what does that mean? >> well, that meant the fear was

that t.a.r.p. which was at the time extremely unpopular, and it's not a popular idea to use taxpayer funds to try to shore up banks, no president would want to do that unless we're in extraordinary situations. i'm sure the bush administration didn't seek the funds gleefully. we were concerned that that wouldn't be sufficient, given the scale of the problem we were facing. now, it's fortunate and i think because of the extremely skillful management of secretary geithner and i would also give secretary paulson a fair amount of credit, that we were able to shore up the financial sector, then get private capital in after conducting the stress tests, and have taxpayers repaid and repaid with a profit from the financial system. not from some of the other investments but they were not designed to make money. they were designed to rescue the economy. i think we can look back at it, it wasn't so clear that we

wouldn't have been in a much, much deeper crisis. >> all right. bring you in the conversation. i think we have a question in the back. >> [inaudible] >> if you just say your name [inaudible] >> while we're doing that, we'll ask you about senator elizabeth warren. spin what about her? [laughter] it's an open-ended question. >> she has been a champion of consumers and particularly in the financial area for decades. i think she brings a new element to the u.s. senate. i haven't had all that much contact with her as an academic. i've had some contact with her win is a treasure but i think she's definitely a superstar within the democratic caucus. much the way hillary clinton was

i might say spirit she and send it again and others introduced classes to go for the 21st century. do we need a? >> i think we have the tools from dodd-frank to address some of the problems that can arise in the financial sector. i think it's extreme important that we continue to implement them. and again like the aca, is extremely important that there adequately funded, that those agencies are adequately fund. has been kind of a self war on both aca and dodd-frank when it comes to funding the regulatory agencies. but resolution authority, the higher capital requirements, the living wills that institutions are required to provide, and the financial stability oversight committee are all i think important new tools and what do you mean by stealth war? >> by some element of congress and special interests to in

adequately fund the regulators, which would make it much more difficult to implement dodd-frank and also put the financial sector more at risk between boom and bust cycle that we had to fork. >> if someone that has a question, go ahead. >> [inaudible] >> can you say you are? >> [inaudible] >> welcome. i have to enter very carefully, because we have long-standing policy of not -- on the federal reserve. but just in terms of inflation, i think we're seeing inflation expectations pretty well anchored. i think we see that both in

product markets as was in labor markets. and we have had retain inflation, partly because health care costs have been growing subglacial -- solely. i do believe that is a result of some structural changes within the health care change. >> you are turning to prince. telescope what is paul krugman like? [laughter] >> poll has the office two doors down from me, and speech if you need or messy? >> he's been a good college. i think and mention to you beforehand, that in the semester i was back i developed a new course called the great recession, causing consequences and remedies. paul fontenot such a good he decided to teach it. [laughter] so he and i have some interesting comments. >> tell us your new course title. >> it's called the economy and economic policy in 2013 which give me a fair amount of

discretion. spent a good for economics. now, another field of expertise for you, and the administration tried to stay in your lane so you haven't said much about this, but you did a book on terrorism. what makes a terrorist, economics and the roots of terrorism, dedicated to pat tillman, the nfl player and army rangers killed in afghanistan. the gist of it was rejecting the sort of popular explanation for terrorism, that can for people who are educationally or economically depressed. you found out that, in fact, a lot of it was well educated people from wealthy families and do very sophisticated about wanting to affect political outcomes. >> that's right. i think the popular view, stereotypical view of terrorist was wrong. general tendency is for people to become engaged in terrorism because they want to make some type of a political statement. and we have a few of terrorism

that is like street crime and people who are desperate and have nothing to live for get involved in terrorism. and, in fact, it seems to me that it's people who believe in something so strong that they're willing to die for it, is a better explanation for who becomes involved in terrorism. >> is about harder or easier to deal, prevent, curtail? >> i think it makes it harder in the sense that another thing that we found is that those who had more training, higher education them tend to be more effective in terms of carrying out their plot. so in that sense i think it is harder, but i think also, another thing in the book, is that the terrorist organizations are pretty adaptable. so if the authorities are looking for one particular profile, they are pretty good at changing the profile. and one thing i would recommend to the audience recommend to the audience is recommend to the audiences, a fact his new movie i saw last week called the

attack about a palestinian couple based on a true story which is remarkable speed is about a suicide bomb. >> i don't want to give away the whole movie, but very well educated couple and really does fit the conclusions i found in my book. >> so what did you learn from the attack? >> it was an excellent movie. i mean, i wouldn't generalize the one case but one of the things that i did in my book was to bring quantitative analysis. i think you could say before nate silver, maybe before money ball tried to bring quantitative analysis to the field of characters and policy. policy. >> last question on this. was should we worry about now? do you think the threat has diminished or increased? >> well, i'll stay in my lane and leave that to the president, advisors on -- >> all right. so i think it's fitting that

friday is a job day and you get to do your blogging and defenses. what's it like to be the hearse and who was thrown out there on jobs days month after month, sometimes it's good news, often overdone it was bad news? >> is not the easiest day of the month for me. i tell you what i find problematic about it. i tried to take a long view, the numbers are very volatile. i added a paragraph to my statement as the administration cautions every month, the jobs number's are very volatile, they get revised, and people make too much out of the monthly numbers. i had not -- in the month report. what i try to do is look at the 12 month change. there are issues about adjustments causing some blips in the data also. if you look at the change from july to july, you abstract from that. and i've found if you look over the course of this recovery, on

a rolling 12 month basis, we've been creating about 2 million, 2.1, 2.2 million jobs a year for the last two and half years. and i think when you look at in that perspective, you're a little bit less inclined to overreact to the news, which is what happens i think in much of the press on the monthly jobs report. so that's what i try to achieve. i'm sure i failed. i'll try again regardless of what the numbers are. and i get criticized because my statement has been fairly consistent over time, which is the latest report shows that economy is continuing to heal, and sometimes i get criticized for being lazy and not updating that statement. but my view has been when that stopped being true i'll change it. so far, over my whole tenure, we have been gradually digging our way out of this very deep recession. there's a lot more that needs to be done that i think we're on a much better path than we were before i started working in

government. >> you are also known around washington for your tennis skills. one of your former partners describes your tennis style to me as coolly effective, which they described in contrast to gene sperling but they said was much more emotional. i know that will surprise all the. what does it take to be good in tennis? >> practice. [laughter] franco, i love tennis. for me, what's great, i was telling -- who plays for the washington capitals, that it's a refuge for me. but i was on the track team when i was growing up and i loved running. but every year i get older i run more slowly and that's not so much fun. antennas is kind of therapeutic pick a decent chance to run and chase after the ball, and the more i practice, i feel like -- i just have the illusion of feel like i'm getting better but i the only should a feeling like i'm not getting worse.

>> so if you can extrapolate from rockonomics to the middle class conflict can you tell us about tennis and the middle class? testing your versatility. >> i think it's important that people exercise. i think that's part of a healthy life. middle-class life. >> your home remained in new jersey, your native state, so when you're in d.c., you enjoy d.c. restaurant. how has the restaurants change since the clinton administration and would you tell new yorkers about d.c. restaurants? >> i don't have to go back to the clinton administration. in the two years i've been living on 15th and p. streets. 14 street corridor has changed dramatically. there's a new restaurant every other day. the restaurants, i think they're excellent. i love to go to -- i tried lot

diplomat for the first time in my neighborhood. >> doesn't live up to the height of? >> i should probably tried a second time before i answer that. [laughter] >> brunch or dinner and? >> for brunch. i like like one of my standard in my neighborhood. so how does it compare to new york? new york has, i was in europe has a lot more restaurants. i think that the tops are very similar. new york restaurants to open a lightly. i used to live above a fabulous restaurant, and for a spanish restaurant, it closed at 10:00, that seemed to me -- we were just getting ready to go out for dinner then picks i think that's part of the biggest difference is the hours. hours. >> i think we have another question down here. go ahead. >> i'm curious, there's been a lot of discussion about the rise in disability, and the question of some argue that, that is a

class of workers could just don't have a place in the economy as it currently is, in that there's just not a home for them to have a job to add value to any of that sort of thing. do you think that's true? and if so, what are the solutions to deal with that problem? >> i think the rise in disability insurance is driven by a number of factors. one is the demographic trends we talked about earlier, and clearly the fact that the world workforce has been aging is one factor, and that's something that the social security of administration trustees have predicted. but also the state of the economy does tend to matter. and particularly concerned about the rise in participation in disability insurance among working age people. i think it's symptomatic of the trends that are been taking place in the economy over the last several decades, that the middle has been hollowing out.

and i think that we need to create more demand for workers in the u.s., more demand particularly jobs that pay decent wages. we also have to make sure the workers have sufficient training for those jobs. i can tell you don't nobody wants to be on disability insurance. i did a study years ago of people who were paraplegics, and looking at their job prospects. and we interviewed about 800 people, and it was sort of a catch-22 at that time, because many of the individuals could've used some of the new technology but because they weren't able to work, people were warning about how to use a computer on the job and they did have access to that. so i do think that there are opportunities to provide training to reach the disability population to provide them with more opportunity. >> and tranten as we say goodbye, my last question.

what's a book that we should read? entering your august peace when you're in montana and other places that our budget, what is something that you're looking forward to? >> well, i very much like my colleague dani's book, thinking fast and slow spin what's the big idea there? >> the big idea is that when people make decisions, sometimes they make decisions based on emotion, like some dimension on tennis courts. and other times, and using kind of rules of thumb and intuition which might be wrong. and other times they think through the benefits and the costs and they think more rationally about their decision. so that's i think that this book that we talk together. so very much enjoyed collaborating with him over the years. what i want to read? i'm looking forward to reading some nonfiction, fiction. i haven't read fiction in your longtime and maybe you can give me some recommendations.

>> what genre are you into? >> i like mysteries. >> all right and one other book you recommend to tell us about the theories that would not die? >> that's a very nice book. i read that just before i came back to government. the theory that wouldn't die is kind of the system to make in economic framework. it's about analysis and bays law which i pointed to statistics learn and then forgot is a way of integrating new information, and to tell you how to update when you learn something new, how much should you change your views. and some people never change their views, other people change them to easily. and the history of bays laws absolute faceting. it's been applied in many different situation, including search engine, including looking for bombs that fall off of airplanes. the history of it is absolutely quite fascinating.

>> thank jeff wouldn't think of a marker for making this possibly are we thank all of you out in life streamlined were watching during their lunch. thank all of you who are here in person. mr. chairman, thank you for a great conversation. thank you very much. [applause] >> [inaudible conversations] >> this morning the u.s. senate begins debate on the first of three pending nominations to the national labor relations board took a vote is scheduled for about 15 minutes from now on moving forward with one of those

nominations. votes on the other to national labor relations board nominees are possible today. later in the day when expecting the senate to continue work on a spending bill for transportation and housing programs. the senate live on c-span2. tepl the senate will come to order -- the president pro tempore: the senate will come to order. the chaplain, retired admiral barry black, will lead the senate in prayer. the chaplain: let us pray. sovereign master of the universe, your kingdom cannot be shaken, for you are king of kings and lord of lords. we praise you that more things are wrought by prayer than this world can't imagine. lord, thank you for inviting us

to ask and receive, to seek and find, and to knock for doors to open. forgive us when we have forfeited your blessings because of our failure to ask. forgive us also when we have lacked the humility to turn from evil, to seek your face, and to pursue your pats. -- paths. may this prayer that opens today's session be a spring board for intercession throughout this day. help our senators to pause repeatedly during their challenging work to ask you for wisdom and guidance. we pray in your merciful name.

amen. the president pro tempore: please join me in reciting the pledge of allegiance i pledge allegiance to the flag of the united states of america and to the republic for which it stands, one nation under god, indivisible, with liberty and justice for all. . mr. reid: mr. president? tepl the majority leader. mr. reid:ing following remarks of senator mcconnell and me the senate will proceed to executive session to consider the nomination of calendar 22 this, the nomination of kent hirozawa phaoepbdly have a cloture vote on that nomination. i'm told h.r. 22181 due for a

second reading. the clerk: an act to amend subtitle d of the solid waste disposal act and so forth. mr. reid: i would now object to further proceedings at this time, mr. president. the president pro tempore: objection is heard. the bill will be placed on the calendar. mr. reid: mr. president, the senate is poised to consider nominations of the national labor national labor relations board. this board is an important safeguard for workers in america regardless of whether their employees are union or nonunion. without the work of the nlrb employees would have no entity to address the wrongs. union elections would remain to employers and employees. i'm glad the senate is moving

forward as agreed to confirm five nominees to the nlrb, two republicans and three democrats. the senate will consider three democratic nominees and two republican nominees today. once confirmed the nlrb will have five senate confirmed nominees for the first time in a decade. they are eminently qualified. mark pearce served on the national labor relations board for three years. he was the founding partner of a buffalo, new york, law firm where he practiced employment law. he received his bachelor's degree from cornell and. mr. law degree from suny, buffalo. kent hirozawa worked on state

and labor employment law. he has a bachelor's degree from yale and law degree from n.y.u. nancy shiffer has worked for the united auto workers and served as staff attorney in the detroit regional office for nlrb. she received her bachelor's degree from new york state. once we vote on the three democratic nominees by consent we'll consider the republican nominees. harry johnson is a partner in a prestigious los angeles law firm and practices labor unemployment law. mr. johnson received his bachelor's degree from johns hopkins university. the other republican nominee,

philip miscimarra is a partner in a chicago law firm. he received his bachelor's degree from duquesne and his m.b.a. from the university of pennsylvania. these nominees are responsible for ensuring fair compensation working conditions for america. look at the resumes of these five individuals. they are pretty impressive. they are experienced and dedicated public servants and i have no doubt they will perform their duties with distinction. mr. mcconnell: mr. president? the presiding officer: the republican leader. mr. mcconnell: today the president will continue his campaign road tour in chattanooga. we hear he plans to make an announcement about corporate taxes. while i understand he's looking for headlines here, reports indicate that the policy intends to announce doesn't exactly

qualify as news. it's just a further left version of a widely panned plan he already proposed two years ago, this time with extra goodies for tax and spend liberals. the plan which i just learned about last night lacks meaningful bipartisan input, and the tax hike it includes is going to dampen any boost business might otherwise get to help our economy. in fact, it could actually hurt small businesses and it represents an unmistakable signal that the president has literally backed away from his campaign-era promise to corporate america, the tax reform would be revenue neutral to them. not only is this a rebuke to one of his party's most senior senators, the finance committee chairman, it also represents a serious blow to one of the best chances for true bipartisan action here in washington. i truly hope the president reconsiders this plan and

consults with congress before moving any further. now on a different matter, two summers ago republicans and democrats came together to agree on a set of spending caps for the following decade. president obama agreed to it, as did leaders of both parties in the senate and in the house. it was essentially a promise made to the american people that washington would reduce spending by $2.1 trillion. and i was happy to help lead that effort. two years later democrats are now trying to find ways to literally walk away from the promise we made. they're pressing to abandon the 2011 agreement in favor of higher spending is evidenced by appropriations bill like the one we're considering this week, which actually hikes up spending by double digits. and the president is now actually threatening to veto bills that live up to the commitment we all made together two years ago.

let me repeat that. the president of the united states, who during the campaign took credit for the very savings democrats now want to walk away from, is threatening to veto spending bills that would actually follow the law and live up to the commitment he himself signed. this represents a stunning shift for democrats who just recently were warning against breaking the agreement. the chairwoman of the budget committee said last year that we have to be able to count on agreements that have been made instead of threatening a government shutdown. yet, that's just what she and her party are now threatening to do, to shut down the government unless an agreement we all made is literally torn up and thrown away. so democrats want to shut down the government because they can't wiggle their way out of a deal they agreed to. i guess there isn't much we can do to stop them. but republicans intend to stick by the commitments we made to our constituents. now that having been said, there's also this to remember.

republicans have always said there may be more effective, effective ways to achieve comparable spending reductions. and if democrats want to propose smarter spending cuts that achieve the same kind of savings they committed to back in 2011, we're ready to listen. comprehensive spending reform should be a good place to start because republicans understand america's largest fiscal challenges stem from the fact that programs our fellow americans hope to rely on in their most vulnerable years are going bankrupt. and republicans are saying the only way to avert that kind of panicked tax increases we've seen in europe is to implement forward-looking reforms today. that is why it is amusing when the president and his allies try to brand the innovative government spending reforms we favor as european-style austerity as he implied again this weekend. nothing be could be further from

the truth. what the europeans are doing in response to the threats from their creditors is the opposite of the approach favored by republicans. this is a type of long-term spending reforms we envision are often the only anecdote against the kind of austerity we see in europe, because european austerity isn't about protecting future generations from spending cuts. it's about staying afloat today. today. and the tax increases europeans enact under duress and the kind of pain detroiters experience under bankruptcy, these are exactly the things republicans aim to avoid and we aim to avoid those things by acting intelligently today while we still have the time. unlike democrats, republicans aren't looking for some colorless discussion about raising taxes here or snipping there or moving numbers around on a budget chart. we'd rather have a more holistic

forward-looking conversation, one about modernizing government to meet the challenges of the 21st century. where we ask questions like this: how do we modernize entitlement programs so they'll actually be accessible to americans when they need them? which government program should be reformed, updated or no longer make sense in the 21st century economy? how can service be delivered in a more efficient and technological salvery way? -- savvy way? what reforms can we implement to ensure the most robust growth for this generation and those to come? by answering big questions now, identifying forward-looking reforms today we can do a lot more than reduce the deficit in the short term. we can also create jobs now, grow the economy now, make government work better now, and eliminate the threat of a debt crisis everyone knows is heading

our way. a debt crisis that would usher in the very kind of european-style austerity democrats claim to like but keep accelerating -- claim not to like but keep accelerating exactly toward. but in order for this to happen, the democrats need to work with us. as a first step, they should step back from the brink where their plan to shut down the government and stop tearing up agreements we previously ascended to. the budget control act might not be pefrbt -- perfect but we were able to secure spending control for the american people. if the democrats want savings for innovative he reforms that can serve our country even better over the long term, there are plenty policy-makers ready to listen. but republicans are not going to just give up on commitments tphaoeud -- made to our constituents.

not only would that be a betrayal of a promise we've made but we've seen where the left-leaning policies and european-inspired ideas lead. and more of that is the last thing our country needs right now. i yield the floor. the presiding officer: under the previous order, the leadership time is reserved. under the previous order, the senate will proceed to executive session to consider to the following nomination which the clerk will report. the clerk: nomination: national labor relations board, kent hirozawa to be a member. the presiding officer: under the previous order, the clerk will the clerk will report. the clerk: cloture motion. we hereby move to bring to a close debate on the nomination of kent hirozawa of new york to be a member of the national

labor relations board signed by 17 senators. the presiding officer: by unanimous consent the mandatory quorum call has been waived. the question is, is it the sense of the senate that debate on the nomination of kent hirozawa of new york to be a member of the national labor relations board for the term of five years expiring august 27, 2016, shall be brought to a close? the yeas and nays are mandatory under the rule. the clerk will call the roll. vote: vote:

vote:

the presiding officer: are there any other senators wishing to vote or wishing to change their vote?

if not, then on this vote the yeas are 64. the nays are 34. three-fifths of the senators duly chosen and sworn have voted in the affirmative. the motion is agreed to. cloture having been invoked pursuant to senate resolution 15 of the 113th congress, there will now be up to eight hours of postcloture consideration of the nomination equally divided in the usual form. mr. harkin: mr. president? the presiding officer: the senator from iowa is recognized. mr. harkin: mr. president, i understand that we are now on a

postcloture debate on this nominee. i understand there's up to eight hours that can be consumed by that, if i'm not mistaken? the presiding officer: the senator is correct. mr. harkin: i certainly hope we don't have to take that much time. i hope that this nominee and the other four to follow, i'm hopeful that we can get through those today and get the board, get these nominees down to the president before we leave here this evening. mr. president, today's a day that i and many of my colleagues have long waited for because of the bipartisan deal that was reached on the president's nominees, it looks like we finally have a path forward to confirm a full slate of nominees to the national labor relations board. a fully confirmed, fully functional board will be a huge step forward for workers,

employees in our country and this will be the first time in over a decade that this has happened. over 75 years ago congress enacted the national labor relations act, guaranteeing american workers the right to form and join a union and to bargain for a better life. for both union and nonunion workers alike, the act provides for essential protections. it gives workers a voice in the workplace, allowing them to join together and speak up for fair wages and good benefits and safe working conditions. these rights ensure that the people who do the real work in this country see the benefits when our economy grows and aren't mistreated or put at risk on their job. the national labor relations board is the guardian of these fundamental rights. workers themselves cannot enforce the national labor relations act. the board is the only place workers can go if they have been

treated unfairly and denied the basic protections that the law provides. thus, the board plays a vital role in vindicating workers' rights. in the past ten years the nlrb has secured opportunities for reenstatement for 22,544 employees who were unjustly fired. it has also recovered more than $1 billion on behalf of workers whose rights were violated in the last decade. now, the board doesn't just protect the rights of workers in unions. it also provides relief and remedies to our nation's employers. the board is an employer's only recourse if a union commences a wildcat strike or refuses to bargain in good faith during negotiations. the nlrb also helps numerous businesses resolve disputes

efficiently. for example, when two unions picketed wal-mart in 2012, wal-mart filed a claim with the nlrb and the nlrb negotiated a settlement. so by preventing labor disputes that could disrupt our economy, the work that the board does is vital to every worker and every business across the nation. earlier this year, i received a letter from 32 management side and 15 union side labor attorneys from across the country that made this point particularly well. it urged the swift confirmation of a full package of five nlrb nominees and said, and i quote -- "while we differ in our views over the decisions and actions of the nlrb over the years, we do agree that our client's interests are best

served by the stability and certainty that a full confirmed board will bring to the field of labor management relations." end quote. i couldn't agree more. confirming these nominees swiftly is vitally important because the nlrb must have a quorum of three board members to act. if there are less than three board members at any time, the board cannot issue decisions and essentially must shut down. although the board currently has three members, chairman pairs' term -- pearce's term expires on august 27, next month. at that point, the board would be unable to function unless we can confirm additional members. that's more than just an administrative headache. it would be a tragedy that denies justice to working men and women across the country. so it's imperative that we act to avoid this and keep the board open for work.

now, mr. president, up until recent times, all of us here in congress agreed that the board should function for the good of our country and our economy, but in the last few years, that understanding has broken down. as i said, it's been a decade since the board has had five senate confirmed members. it's not that qualified people haven't been nominated, because they have. the problem is that a few of my colleagues on the other side of the aisle -- i'm not saying everyone but a very vocal minority -- have been trying to use the nominations process to undermine the mission of the national labor relations board. they first of all don't like the national labor relations act, but they know they could never repeal it outright, so what's their solution?

this vocal minority on the republicans side? keep the nlrb inoperable by refusing to confirm nominees, regardless of their qualifications. in this case, one of my republican colleagues announced his intention to filibuster nlrb nominees six days before the nominations were announced. and he openly admitted that his intention was to shut down the agency. now, we have seen lots of nominees deemed unacceptable simply because they have worked on behalf of workers or unions, and they support our system of collective bargaining. these nominees have been accused of being biased and called unfit to serve because they work for labor unions or lawyers for labor unions. but i'd like to point out what

the national labor relations act, certain to the free flow of commerce and to mitigate and eliminate these obstructions when they have occurred. by encouraging the practice and procedure of collective bargaining and by protecting the exercise by workers of full freedom of association, self-organization and designation of representatives of their own choosing for the purpose of negotiating the terms

and conditions of their employment or other mutual aid for protection. end quote. that's what the law says. the purpose is, again, to encourage the practice and procedure of collective bargaining for the good of our workers, for the good of our economy, for the good of our nation. so if you have a nominee that comes up that's for the board that supports collective bargaining, i would think that nominee would be more qualified, not less qualified to serve on the board, because that nominee understands what the law says. so we should be seeking nominees who are, in the words of one of the nominees before us today, not prounion, not proworker or promanagement, but proact. proact.

and if you are proact, the act shays that we should be encourage -- says we should be encouraging the practice and procedure of collective bargaining. and by protecting the exercise of workers of full freedom of association, self-organization and designation of representatives of their own choosing. that's what the law says. i'm optimistic that the nominees before us today will bring this perspective to their work at the board. all five nominees have diverse background and are deeply steeped in labor and employment law. now while i certainly don't agree with the politics or perhaps ideology of each nominee, it cannot be disputed that this is a competent and experienced group of lawyers. given their diverse background and qualifications, there is no reason that this package of nominees should not be confirmed with strong bipartisan support.

all five of these nominees have been thoroughly vetted. while for the two most recent nominees, kent hirozawa and nancy schiffer, the vetting process has been quick but it has been thorough. they have submitted all of the paperwork that we received for our nominees. they have appeared before our committee in a hearing, answered any questions, they have met with staff for both sides, and they have answered all the written questions posed by members of my committee. they have demonstrated themselves to be impressively qualified and capable, and i look forward to their future service on the board. so i believe the time has come to start a new chapter for the nlrb. it's time to ratchet down the political rhetoric that has recently haunted this agency and let the dedicated public servants who work there do their

jobs. indeed, i hope today's votes mark a new beginning for the board, with a new energy, vitality and new spirit of collaboration. a revitalized nlrb is a critical part of our continued toefrts rebuild a -- efforts to rebuild a strong economy and strong middle class. it's long past time to put the board back in business and to tone down the rhetoric. i say to my friends on the other side, again, a vocal minority, certainly they can vote against the nominees. that's their right. that's their privilege. but don't use the nomination process to try to shut down the board or to thwart the -- the implementation of the national labor relations act..

-- relations act. i'm sure there are times when a majority of the board were appointed by republican presidents that were probably more pro management. i can't think of one right now, but i am sure that they probably made some decisions that i would not be in favor of. but they did it openly. and there are times when under a democratic president when the board would probably have three members that would be more from the labor side than management side. but that's the ebb and flow. and quite frankly, for most of the times in the past even though republican presidents had put nominees on the board that were probably more pro management or came from the management side, they would have three of those and then two from the worker or labor side, they still ran the board in a nonpartisan fashion. they reached agreements in open

fashion that were implementing the national labor relations act. i would be hard pressed to think of a time when the board acted in contradiction to what the act actually says. but until recently, -- and this is just broken down in the last few years when president obama's nominees to the board in the first instance were filibustered, when the president had the recess appointment, gave recess appointments to nominees, and of course the recess appointment can only last so long and then that person has to leave the board. and as i said, there was a threat by a member on the republican side to filibuster nominees before they were even

sent down. that means the board would have been unable to operate. and so the president then gave a recess appointment to nominees to keep the board functioning. that then found its way into the courts. we have a couple of courts that decided the president didn't have the power to do a recess appointment the way he did it. other courts have taken different pathways, so that -- that set of facts in that case is winding its way to the supreme court. probably will be decided sometime next year. but that's what happens when -- when people don't let nominees who are fully qualified, fully qualified come to the floor to get an up-or-down vote. so i'm very pleased that in this

agreement that was reached a couple weeks ago to not filibuster nominees included the national labor relations board. so we have an agreement from the republican side that they will not filibuster these nominees. we have five of them. this is the first, mr. hirozawa, and i'm hopeful that again since they have been thoroughly vetted that we can move ahead expeditiously to vote on them and that we won't take the full eight hours to -- to debate these nominees, for each one of them. each one would have eight hours, but hopefully we can collapse that and have the votes on the nominees sometime later this afternoon, and as i said turn a new chapter in the nlrb, put them down there, get the board and let them do their work and tone down the political rhetoric a little bit on the national

labor relations board. so with that, mr. president, i request unanimous consent that a legal fellow in senator blumenthal's office, afton cicell be granted floor privileges for the duration of july 30, 2013. the presiding officer: without objection, so ordered. mr. harkin: mr. president, i ask unanimous consent time during all postcloture quorum calls on the hirozawa nomination be charged equally to both sides. the presiding officer: without objection, so ordered. mr. harkin: mr. president, i yield the floor and i note the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

the presiding officer: the senator from nebraska. mr. johanns: mr. president, i ask unanimous consent that the quorum call be set aside. the presiding officer: without objection, so ordered. mr. johanns: and i ask unanimous consent that i be allowed to speak about five minutes as in -- as if in morning business. the presiding officer: without objection, so ordered. the gentleman is recognized. skwrapbs thank you, mr. president. as we -- mr. johanns: thank you, mr. president, as we begin our final week of legislative activity prior to the august work period, i rise today to discuss the fiscal challenges that will await us on our return. when the senate gavels back into session on september 9, we'll be only three short weeks away from the end of the fiscal year. we'll have only 15 business days to reach an agreement on all 12 appropriations bill and avoid a government shutdown.

unfortunately, our progress toward reaching this goal has been less than stellar. the transportation housing appropriations bill that we are currently considering is the first of 12 bills that has even been brought to the senate floor. consider this, we cannot even agree to comply with the spending limits mandated under current law. so we are headed for a big multitrain pileup. just last congress the senate and the house made a promise to the american people, made a promise about a basic level of fiscal constraint on our appropriations process. not enough, but a step in the right direction. as a part of the budget control act which passed with bipartisan support and was signed by the president, we committed to

capping appropriate spending at certain levels for each of the next ten years. less than a year ago the majority leader emphatically proclaimed them binding when he said -- quote -- "we passed the budget control act. we've agreed to all of those numbers. they're done. they're agreed to." so in only the second year of this ten-year schedule, the 12 appropriations bills are mandated to spend no more than $967 billion. that's a huge number to almost everyone. it is simply a whole lot of spending, almost $3 billion a day. but my colleagues on the other side want to spend even more. in fact, they want to spend well over $1 trillion this year. you see, they want to pretend that the budget control act never passed and was never

signed into law, and they want to keep on spending like there's some kind of alternative reality. but sadly, that is not the case. our nation's deficit is still too large. we're still miles away from a balanced budget. and the national debt continues on a course toward disaster. yet, apparently we're going to ignore the appropriation caps we all agreed to just two years ago. and not by an insignificant amount. an additional $91 billion above the legal limit in the next fiscal year alone. as a new member of the appropriations committee, i've been surprised to watch week after week bills being advanced that simply ignore current law. with a $17 trillion national debt, we cannot simply imagine our way out of this crisis.

but by ignoring the budget control act, that is exactly what we are attempting to do. so i continue to believe very strongly that we should be preparing bills that are consistent with current law, abiding by spending caps we voted for and signed by the president. i think we should even do more than that but complying with the current law is the bare minimum. so what does all of this mean? who gets hurt if we ignore the b.c.a. caps? ignoring the b.c.a. spending levels isn't just free money that we can print down at the treasury department. spending over the b.c.a. cap simply sets the stage for yet another round of sequester cuts. now, we all remember how popular that was beginning this year.

administration officials claimed our health, our safety, our well-being were in the balance as they traveled the country threatening services like head start, food safety inspectors and massive delays at our ports because of the indiscriminatate across-the-board spending cuts. and that is exactly what we are going to see in a few weeks because the majority would rather wash their hands of the responsibility to honor the camps and continue spending like the actions don't matter. but that's exactly the senate's plan. spend $91 billion over what the law allow. and when $91 billion worth of across-the-board cuts kick in, they hope the outcry from the american people is loud enough to convince us here in congress to add the additional spending

to our national debt. now in my judgment, that is no way to run a railroad, but that seems to be the plan. keep spending us right into another questions ter, ignore the consequences and hope for the best. it boggles the mind especially when you consider that all but two democrats on the appropriations committee supported -- i emphasize -- supported this level of spending restraint than the b.c.a.. while instead we should have been using this time as an opportunity to more thoughtfully reduce spending before the end of the fiscal year, that's exactly what president obama says he wants when he says congress should use a scalpel to tame our budget problems, not an

ax, in across-the-board spending cuts. we can responsibly meet the $967 billion spending kargt in current law but we have to try. but if instead of seizing the opportunity we are once again shirking our responsibility in the hopes that no one will notice, that's disappointing to the american people. but exceeding the caps we are violating yet another commitment we have made to them to get our fiscal house in order. you see, the american people figured this oeut long ago. -- figured this oeut long ago. washington simply spends too much and most importantly, spends too much of their own money. and as their elected representatives, we should not ignore them. i am hopeful we can take this opportunity and ensure our spending bills total no more

than what we promised just months ago. come october 1, the american people will have the opportunity to see whether we have met that challenge, and i hope for the sake of the country they get better news than what appears today. mr. president, i yield the floor. i note the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

mr. harkin: mr. president, i ask further proceedings under the quorum call be dispensed with. the presiding officer: the senator from iowa. without objection. mr. harkin: i have nine unanimous consent requests for committees to meet during today's session of the senate. they have the approval of the majority and minority leaders. i ask unanimous consent that these requests be agreed to and that the requests be printed in the record. the presiding officer: without objection. mr. harkin: mr. president, i note the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call:

quorum call:

quorum call:

mr.mr. alexander: mr. president? the presiding officer: the senator from tennessee. mr. alexander: i ask consent to vitiate the quorum call. the presiding officer: without objection. mr. alexander: i ask consent to speak in morning business. the presiding officer: without objection. mr. alexander: this week the senate is voting on five of the president's nominations for

membership on the national labor relations board. i expect all five to receive up-or-down votes, as they generally do, and i expect all five to be confirmed. and the board will then have a full complement. with a democratic majority of three and two republican members. i'd like to review for a moment what has happened and how we got to this spot, because it's an important moment in the history of our ability as a country to maintain checks and balances and a certain separation of power along the various branches of government, and especially to restrain the executive, which has been an important part of our country's history. in january of 2012, the president nominated two individuals to be members of the

national labor relations board using his recess appointment power. he has that power in the constitution. the only problem was the senate wasn't in recess. at least that was our view. the senate was in a three-day pro forma session. a three-day pro forma session is a device that was invented by senator reid, the distinguished majority leader, when he was -- when president bush was president. and he did it to keep president bush from using his recess appointment power when the senate was in recess. president bush didn't like that. most of our presidents have chafed under the restraints that we have placed upon our executive. but he respected it. and president bush never made recess appointments while the senate was in session, but president obama did on january 4, 2012. republicans objected strongly to that.

and after a great deal of discussion, we helped to bring a lawsuit. that lawsuit went before the d.c. circuit court of appeals, and the circuit court of appeals disagreed with our position; said in effect that the president could not make recess appointment when the senate itself determined that it was in session. and since then there have been two other decisions by other courts of appeals that have said that what the president did on january 4, 2012, was unconstitutional. that will come before the supreme court this next term. no one knows what decision the supreme court will make. but my sense would be that the supreme court will say to this president or to any president that, mr. president, you can't use your constitutional power to make a recess appointment at a time when the senate is not in recess. i said earlier that the

presidents have chafed under these restraints on the executive branch. that's been true ever since the days of george washington. george washington imposed his own modesty and restraint upon the american character when he resigned his commission after the revolutionary war, when he stepped down after two terms as president and went back to mount vernon, when he asked to be called "mr. president" instead of your excellency. ever since then we've had many strong presidents, and they haven't liked the idea that washington also helped write a constitution that created a congress and a bill of rights. and the whole purpose of that was to restrain the executive. after all, our revolution was against the king. and most of our founders -- not all of them, but most of them and the ones that had a majority in the constitution didn't want a king of the united states. they wanted a president of the united states. and one of the most important

checks upon the power of the executive is the senate's power to advise and consent, the power to review. about 1,000 presidential nominations have come to us, and it takes awhile. sometimes it takes longer than the nominees think. i've repeated many times on this floor when president bush i nominated me to be education secretary and the senator from ohio held up my nomination for three months. i didn't think that was such a good idea but the senate had the power to do it because the constitution restrains the executive. unfortunately this president didn't seem to read that chapter in american history, because we've seen during this president's time repeated efforts to circumvent the constitutional checks on the executive. this administration has pointed more czars than the romanovs have. that's the way you get around the nomination process. this administration's excellent

education secretary has used a simple waiver authority in effect to create a national school board. when congress says we don't want to appropriate money to implement obamacare, the health secretary says, well, congress won't do it, i'll do it anyway. i'll raise some private money and do it. and then we have recess appointments being made when the senate's not in recess. that's unconstitutional. if that could happen, the senate could adjourn for lunch and come back and we'd have a new supreme court justice because the president said we were in recess. so what's happening this week with these national labor relation board nominees has a special significance in our constitutional history, because not only did republicans bring a lawsuit which we're winning in three courts. we brought it in one. the case has been brought in three different federal courts. but the president, after much discussion, has withdrawn his two illegally appointed

nominees. i suggested that he do this in may when we had a markup of the five nominees that the president sent. i voted for three: the democratic chairman and the two republicans. and i voted against the two who were legally pointed. they are well qualified people. that wasn't the issue. the issue was the senate needed a way to express its objection to this unconstitutional action by the executive. and i suggested that what the president should do is withdraw those two nominees and send us two new ones in the normal process, people who had not stayed on after the federal court had decided they were unconstitutionally there. these two unconstitutionally appointed nominees, mr. president, have decided more than 1,000 cases. they're all subject to being vacated because there was no constitutional quorum. it leaves quite a mess in our labor laws. but the president withdrew those

two. and now we are this week doing what the senate normally does. we are considering the normal process, his new nominees. now i'm voting, as i said, for the two republicans and the chairman. the chairman did not -- was not legally appointed. he did not continue to serve as a legally appointed person, since he wasn't appointed legally, so i voted for him. i don't agree with the chairman in his view of labor laws, but i will have to take that up at the next election. elections have consequences. when we elect a president of the united states, he normally appoints people who agree -- who agree with him. i'm also voting for having an up-or-down vote. we almost always do that with the president's nominees. there have only been a few times in our history when we have not. we have never failed to have an up-or-down vote on a supreme court justice after they have come to the floor, never failed

to have an up-or-down vote on a district court judge after they have come to the floor, and the same with -- in terms of circuit courts, we never did until democrats started filibustering president bush's judges about ten years ago when i came to the senate. we all know that story. but normally, normally we have an up-or-down vote and we'll be doing that this week on the president's five nominees. i am voting against two of the nominees when that up-or-down vote comes, and i want to explain why. one is mr. hirozawa and one is miss schiffer. both of them have excellent legal backgrounds, but the problem is i'm not persuaded and i hope i will be proven wrong that they're able to transfer their positions of advocacy to positions of judge, that they can be impartial when employers

come before them. employers as well as employees have a right when they come before the national labor relations board to expect that all five judges, whether they are republicans or democrats, from whatever background they might have come, will look at the case and decide it in an impartial way. it may be possible that mr. hirozawa and miss schiffer can do that, but i'm not persuaded that's true, and so while i'm voting that they have up-or-down votes, i'm not voting for them. the president has nominated three different individuals who were employed directly by major labor unions for the board. first was craig becker who was counsel for two unions, whose nomination was rejected by a bipartisan vote in 2010. the second one was mr. griffin. the third one was miss schiffer.

i asked miss schiffer if she could remember -- i asked at the hearing with other examples of an administration stocking the nlrb are organized labor employees, and she couldn't think of examples and i couldn't think of it either. over the last several years, the nlrb seems to have veered away from impartiality. instead of preserving a level playing field and protecting the carefully balanced rights of all parties, it has shown favoritism toward organized labor leadership and little interest in the rights of employees or individual employees who want to exercise their rights not to join a union. now, in fairness, i will have to admit that this politicization of the nlrb has occurred both in republican administrations and in democratic administrations, but i think appointing a person directly from a major job with a major labor union is not an example of trying to move away

from that -- from that trend. the trend is causing confusion. one labor law professor at a nationally recognized law school recently said she can't even use her labor law textbook anymore. she has to resort to handing out nlrb decisions to explain the law and changing it so much. nlrb has ventured into new rule-making authority, both of which have been stalled by the federal courts. in august, 2011, the board issued a new rule requiring employers to post a biased employees rights poster in the workplace and making it an unfair labor practice to fail to do so. two separate federal courts have struck the rule down because it exceeded statutory authority. then in december, 2011, the board issued a new rule shortening the time in which a union election is held, otherwise known as the ambush election rule. the d.c. court struck down this rule on the grounds it lacked a quorum. the nlrb is appealing the decision. so far, this administration's

nlrb has sought to change the rules for determining bargaining rights, for determining the process for certifying a representation election petition, for determining the legal obligation of employers to withhold dues from employees' paychecks even when there is no valid collective bargaining agreement in place. for determining the validity of arbitration provisions in employment contracts. the legality of numerous well-intentioned employee handbook provisions. the rules governing employee discipline when there is no valid collective bargaining agreement in place. the rules governing the confidentiality of employee witness statements given during a legitimate investigation. determining a new policy forcing nonunion member employees to pay for union lobbying expenses. determining the rules governing employees -- employers' rights to limit access to their property and attempting to create an entirely new employer obligation and unfair labor practice through the poster requirement struck down by

multiple federal appellate courts. the effect of all of these, mr. president, seems to me to tilt the playing field in favor of organized labor instead of impartiality, which is the directive of the statute. so fairness and impartiality is what i'm looking for in any nlrb nominee. two of the nominees do not pass this test for me. that's why i plan to oppose their nominations. but the most important message from this week's debate is this -- the united states senate is saying to not just this president but to any president, republican or democrat, that you may not abuse your constitutional right of recess appointments by making appointments when the senate itself determines that it is not in recess. to do so is an affront to the separation of powers, it undermines the checks and balances that were placed upon the executive at the beginning

of our country as a way of preserving our liberties. that's an important step in the history of constitutional law in this country, and i'm glad to see that it has been done in this way. i thank the president, and i yield the floor. i suggest the absence of a quorum. the presiding officer: the clerk will call the roll. quorum call: mr. alexander: mr. president? the presiding officer: the senator from tennessee. mr. alexander: i ask consent to vitiate the quorum. i ask consent the privileges of the floor be granted to the following member of my staff, chris jacob. the presiding officer: without objection. mr. alexander: i notice the absence of a quorum.

the presiding officer: the clerk will call the roll. quorum call:

quorum call: