environment right now, and that, in fact, given what we have seen with the rise of china and india, the insertion of these giant societies into international economies, the emergence of significant countries such as brazil, turkey, south africa, mexico, indonesia as major regional powers with global ambition, and the emergence of people and societies as major drivers and the finders of so much of our foreign policy and diplomacy, that we are at a time and space where while we protect our security, you need to understand that our future will bring us all going to be about building partnerships and building alliances. and this will require a new focus and a new energy in our diplomacy. ..

>> at a time in which there's been no cataclysmic event that forces us into reforming or renewing these institutions, but a clear recognition that the institutions are becoming increasingly less relevant and increasinglyless capable of addressing some of the very large problems and concerns that the world faces. and be so our ability to kind of reestablish momentum in the u.s./brazil relationship and to insure that it gets back on the kind of meaningful tack that i think both of our governments and our societies want is going

to have a big impact on our ability to conduct this kind of long diplomacy. because ultimately, many, many years from now as historians look back on this time, much of what we consider to be important will not be seen as important. in fact, much of what occupies our every day will fall away and become the chaff and dust of history. but i think what will be remembered and what will be judged by historians is our ability to accommodate these rising powers to transform and renew the institutions that we have created over time, to be responsive to the larger challenges that the world faces and to do so in ways that not only promote international peace and security, but also promote prosperity and the ability of individuals to achieve not just a place for themselves in determining national destiny, but a place for determining their individual destiny. and be thissen means not only

opportunity and resources, but it means an environment this which each of us is respected. and i believe that the united states and brazil because of our broad commitment to human rights, to open societies are in a unique place to do this and, therefore, there's an urgency for us to recapture the direction and purpose of our relationship. and i hope you all share this. but i would, i would like to end there. just reminding ourselves that this year is the 100th anniversary of the roosevelt scientific expedition to brazil which was so wonderfully captured by candice millard in her book, "the river of doubt." i have a picture in my office of roosevelt standing on the fore deck of a vessel as it sailed up into monte e groso where they

began their land trek before they began their journey down the river. and it's a remarkable photograph because one is dressed in navy whites with white shoes, his hair slicked back elegantly, erect, head back, chest out, obviously proud of where he was and what he was doing. roosevelt was dressed in camping clothes with his hat off, his hair messed up, his glasses slightly awry and slightly scrunched and looking at the camera as if he was wondering what was happening. it was kind of a remarkable moment in the sense that it captured the enormously proud and successful man with a roosevelt who had seen and done much and still had much more to do in his life. but what was striking about that trip, of course, is to have two men of such large egos and large

purpose and large experience in life in such close quarters for so long and to have them travel down a river with no hope of ever coming out alive at the end but just an anticipation or an can'tation that they were -- expectation that they were on a historic journey that was going to identify a source of the amazon and accomplish something that was going to be important to brazil and to the world was quite remarkable. and i believe that in many ways this is an image for a larger u.s./brazil relationship that recognizes that friendship and courage and purpose can accomplish a lot in this world. so thank you have. [applause] >> we are going to do now the conversational part of this, and i would like to tell those who are following this on the webcast or through c san that -- c-span that you can send us questions if you wish to it's

our twitter account @brazilinstitute. and just before i open for questions and to maybe complete the story that ambassador shannon just mentioned about rondon and roosevelt, that river, the river of doubt, during the trip was renamed the roosevelt river. but the locals -- and this is very brazilian -- refer to it to this day as -- [speaking spanish] because we treat people by their first name, not their last name. [laughter] but with that, i would like to invite questions for ambassador shannon. please, i would like you to identify yourselves, wait for the microphone that miguel and carlo have, identify yourself so he knows who is asking the question. yes, pleasement -- please. >> bill rugel.

mr. ambassador, it's a pleasure to see you again. you mentioned, and i totally agree, that the future, the past has been in large part determined by the society. in order for that to continue, an observation, then a question. don't we in america first have to convince our society in relationship to the security issues that we are willing and will modify surveillance so that that can be transmitted to brazil? now, however, society is society. but in brazil, of course, the politicians do represent the society, and we still have to convince them. how -- do we have to convince the society in where brazil first the politicians and then, of course, there is a good section in brazil, the media, that is skeptical, so how do you

envision us going about that? that's my question. >> thank you. >> thank you very much. it's a great question. and, you know, one of the challenges of democratic societies, of course, is to create space for the kind of dialogue that we have to have now. and that's one of the reasons the president decided to name a presidential review group to look specifically at signals intelligence gathering and the impact of information technologies on the 21st century. and have a space in which people could talk about this publicly. because one of the challenges always with issues of intelligence gathering is that much of it can't be talked about publicly for all the reasons people are familiar with. and so i think the presidential review group has done a good service in laying out a universe of options for the united states

that will serve, i think, as the basis for a larger conversation. as far as brazil is concerned, you know, we have a lot of work to do, obviously, as do the brazilians themselves. and that's going to have to take place at a variety of levels at the same time. some of this is going to be done between our leaders, some of this will be done between our diplomats and and our intelligence officers, but some of this is going to be done more broadly in the public sphere. and one of the opportunities that has been presented to us by the disclosures is really an ability to engage with our publics about intelligence work in the 21st century and understand in many ways what information technologies mean for us. because if you look at the disclosures issue closely, what you really have is a mapping of

21st century technologies ask can a mapping of the internet -- and a mapping of the internet. and a recognition that the way we communicate is changing fundamental understandings that we have about things like privacy and individual agency and our own behavior. and much of this is not related to intelligence agencies at all. it's related to large companies and how they use bulk data and metadata and how they predict and try to influence how consumers behave. so in many ways we have been offered at the beginning of the 21st century a window into this century, and it will allow us, i think, to make some fundamental decisions not only about how intelligence is gathered, but how we want to structure information in our communities and societies. >> could i just add from a couple of observations from my visit last week meeting with the

business leaders and several congressmen including a very influential senator of the president's party, this is not a representative sampling, but the basic theme was we'd like to get on with it, you know, get past this. so i think within thought leaders and influential parts of brazil there's a desire to move on with the relationship in a constructive manner. this particular senator had been a part of the delegation that came, met with vice president biden and and he was pretty warm about it including the biden experience where biden, the vice president, said, you know, i grew up with two precepts. one is never trust anyone over 70, and don't trust washington

politicians. i'd like to ask you to trust me and violate both of those. so kind of thing, exchange, as you know, that a brazilian politician could welcome. and i think there's also an interest in -- a great challenge, but an opportunity for collaboration in the evolving scheme of governance of the internet that brazil and the u.s. could be with, should be and probably are prepared to cooperate on. >> thank you. claude. >> [inaudible] the u.s. government has already said that -- [inaudible] discuss a new date for the new brazilian president. i'd like to know if you have received any sign from the brazilian sign that they are

ready to discuss and how likely is that the visit can happen at the beginning of next year. and considering your engagement and involvement with brazil, like how you personally experienced the problems that we -- how frustrated you were with what happened. and yesterday we had a very concrete example of the consequences with the decision of the brazilian government to buy with swedish -- [inaudible] like how you saw that. thank you. >> okay. well, thank you. listen, i had the pleasure of beginning my tenure in brazil with wikileaks and ending it with snowden. [laughter] so what i tell people is pogo was right, we have seen the enemy, and he is us. however, you know, obviously diplomacy and representing a country like the united states

is not about personal experience. it's about a responsibility be and a duty not only in this regard to president obama and the united states government, but more broadly to the, to the people of the united states of america. and it's an enormous honor and privilege. and so we just try to do the very best we can. i have deep affection for brazil. i have deep affection for brazilians and tremendous respect. i think brazil is a great nation that has accomplished great things and that will continue to do so over time. and so i'm, you know, deeply committed to the u.s./brazil relationship and to building the kind of partnership i talked about. and so, obviously, you know, finding myself in a situation in which we were going to have to slow down what we were doing diplomatically or look for other ways to express this partnership was frustrating at one level. but at the same time, you know, these are challenges that in an

odd way we relish because it allows us to show what we're capable of, and it tests our conceptual understandings of relationships, and it allows us to expand the context of our diplomatic activity. in terms of the decision yesterday related to the fx2, first of all, congratulations to the swedes. and congratulations to the brazilian air force. this is something that they have wanted for a long time. and even now it's coming too late, but it's still an important step for the brazilian air force. obviously, we're disappointed. boeing did tremendous work in brazil and will continue to do tremendous work in brazil led by ambassador donna ryeneck and the great boeing the teams that have come down to brazil.

but this will not affect, obviously, the kind of cooperation we have developed over time with the brazilian air force. but as i noted and, you know, we have seen kind of clear signs from the brazilian government that it is prepared to engage with us in a meaningful way on issues related to disclose yours whether it be -- disclosures whether it be in international settings such as i said unicef, i met unesco -- unesco, such as unesco and the u.n. general assembly. but also its sons to snowden's -- its response to snowden's request for asylum. so in that regard i feel pretty good about where we are right now. oh, i'm sorry. listen, this is an ongoing discussion we're having, and, you know, we've made it very clear that, you know, that we're prepared to reschedule.

and so i still hi our conversation -- think our conversation with the brazilians have to ripen a little bit before we can get a response from them. >> yes. julia. >> thank you. hello, julia -- [inaudible] with the council on foreign relations. hello, ambassador shannon. i think your opening address and your comments have made an effort to answer the question that i'm going to ask you again, if you don't mind. i think if we go back, and i'd like to ask you how do you address the skeptics in this town? some of them are here, some of them are floating about who would point to the going back just most recently to before your tenure down there to the 2010 tehran agreement, then to the reaction even, let's say, to the nsa disclosures which germany sort of was greeted, germans' reaction was greeted

with greater understanding than perhaps brazil was. even now perhaps to this choice around boeing, i think we still have in this town in some of the bureaucracies that work on regional issues a tendency to understand brazil's reaction to us as kind of a knee-jerk, anti-american reaction. and that cloud and even pointing to brazil's actions on trade issues, on protectionism issues, on patents, whatever. there's a long list of issues that are still pointed to as proof that the united states really can't have the kind of strategic partnership with brazil that you have advocated for. so adeptly. so i guess i'd like you to address that skepticism head on and maybe use a couple of examples even that i didn't mention in latin america where it is pointed to as a place where the united states can't

have brazil as a partner for reasons of how brazil advances its interests that are different from ours. so i'd like you to just sort of poke holes this those arguments if you could, please. thank you. >> thank you very much. listen, as we build this relationship and relationships, obviously, are between at least two and sometimes more, there were skeptics on both sides, and there were skeptics beyond brazil and the united states. for all the reasons you described, you know? on the u.s. side, there has always been people who have tended to view brazil within a south american context and tended to view it as a country that has behaved differently than many of our partners, that has different kinds of ambitions ask that is sometimes -- and that is sometimes viewed as attempting to limit and frustrate our influence and

presence especially in south america. while on the brazilian side there have been skeptics who wonder, sometimes quite loudly, about the value of brazil attaching itself too closely to a country like the united states because of what they perceive as the asymmetry in power and interests. and especially the global reach of the united states and the extent to which brazil finds itself kind of sucked into our wake and is forced to participate in things or act in a way that it does not feel are in its best interests over time. and part of our challenge has been to address those skeptics and reshape understandings of the relationship recognizing that there's a certain degree of truth on both sides and that our interests at times do clash and that our ambitions sometimes work at cross purposes.

but that as jane harman noted at the very beginning that our convergent parts of the relationship are more important than the divergent parts of relationship. and that we have to be able to manage those parts of the relationship that are problematic while we try to build out and expand those parts of the relationship that function well. and in many ways the reason i talked a bit about the long diplomacy is because this is really the challenge of diplomacy, and this is the larger challenge we're going to face with brazil. i mean, be we are looking for in brazil a country that is going to follow our lead at all times and if the brazilians are looking from us a country that is prepared to meet its every need when it comes to market access or some other interest it is pursuing, then both sides are going to be disappointed, and the relationship is going to be troublesome. but if we're able to understand

through building common understandings of the world where we can work together in meaningful fashion, then i think there's a lot we can do. and the potential for a productive, fruitful and positive relationship yous. and i think -- grows. and i think it needs to be taken advantage of. >> okay, nelson. >> [inaudible] >> thank you. nelson cunningham. in my 20 years of daily and weekly engagement with brazil -- which, by the way, i know in this room is a flash in the pan -- there's ono one i've found who -- i don't know if the rules permit this, but given that we have heard tom shannon's really tour de force side, the u.s. side of this, could i ask our moderator, paolo, what will it take from the brazilian side for us to put this disclosure

issue behind us? >> i think it's a recognition in brazil of the importance of this relationship, and you can see it coming from the business community that feels that brazil has, in a sense, somewhat isolated itself in the trade arena, for instance. this is daily news in brazil. this is part of the national conversation in brazil, very much so. you had the president of the national confederation of industries in a recent speech in denver addressing this directly. he is significantly, he is very close to president yousef, he is very close to -- [inaudible] who is likely to run for the governorship of the state of -- [inaudible] he is now the minister of development, industry and commerce in brazil.

so you have this, and you have the signals from society that brazilian societies want more and more engagement with the united states. so i think that's where, you know, but this will appear in a debate in brazil especially, i think, in a presidential election year in brazil next year. it will be interesting, i personally would love if the candidates all have the capacity to engage in this debate in terms of brazil's presence in the world. one thing that i thought ambassador was going to mention but he didn't and i will, you have to an increasing number of brazilian companies, global companies. there are about 30 of them. and some of them are important in an important way in the united states, and they become with new connectors between, for

instance, brazil and the united states. there is only one company very well known that has five subsidiaries in the united states. and are here because, well, this is a big market, but this is also a place to, this is a lace of innovation -- a place of innovation. and i p wanted to conclude, just remember something that the president said exactly one year ago in her last interview of 2012. she was asked about this business of was the fiscal cliff at that time that the united states was going down because they couldn't manage their fiscal affairs and govern themselves. well, she said i don't believe that the united states is losing importance in the world, and this is almost a quote, because i read this so many times. then she said the united states is a country with an extraordinary flexible economy, with a great capacity to

reinvent itself. the united states is going through a revolution in energy and has something -- is the country of innovation and has something that, she says, i value very much, and i think we have to pay attention to, and she repeated four times the word, education. you know that there is a debate in the united states about the quality of education here, etc. but i think those are the topics. now, what it requires, what will happen i just one thing briefly, you know, it takes leadership. it takes leadership here, it takes leadership there to make those interests. but this is completely out of order because i'm not supposed to be saying any of this. [laughter] now, joy and then i'll move there. >> thank you. joy olson from wola. ambassador shannon, it's a pleasure to have you with us, and it's always such a pleasure just to hear you talk. >> thank you. >> you give such a coherent

presentation, and i know that you choose your words very carefully. and so i want to address some, this phrase of the disclosure problem, what you referred to repeatedly. i think, um, probably being one of the only people in the room that's sued the u.s. government for warrantless wiretapping and had her suit actually rejected by the supreme court on the grounds that we couldn't prove standing merely two month t before the snowden disclosures which leads one to continually wonder if we could have proved standing two months later, i think this, the choosing the phrase the disclosure problem makes it seem less serious than i think it really is. because -- and it's not just on a human rights level and the right to privacy, it's on a commercial level and a political level. fundamentally has to do with trust. you know, there is -- and i understand it's corporate as

well as domestic. but i, um, i'd like to hear you respond to that, because i do think it discounts the seriousness of what's happening. and the second is with respect to education and the number of brazilian students coming here to the united states which is enormous. how is it going from the u.s. to brazil? because i have a sense that it's much less, and, um, but i don't know the numbers. and could you talk about that and what you see the future on that side? >> well, i'll address the last one first. it is less. i don't have the exact figures, but i think tsa going to change over time -- that's going to change over time. to begin with, you know, historically when americans have done overseas university stints, it's been focused on europe, largely the u.k., spain and italy with some france thrown in. but that's starting to change. we're seeing more americans going to mexico, we're seeing

more go to around general teak that -- argentina, and it's our open that especially as we build out our component of education in the americas 100,000 strong, that we will be able to begin to build a larger u.s. presence in brazilian universities. but in order to do that successfully, we need the help of brazilian universities. because many brazilian universities are not equipped to take international students easily. they don't have dormitories, they don't have international student programs, and so it tends to fall to the student to find a place to live, networks of -- support networks, etc., etc. to -- and some young students are very good at that. but others aren't. others want kind of a more package deal. and there are a few brazilian universities that are beginning to understand this and are beginning to try to fashion mechanisms that will allow them

to attract foreign students more easily not just from the united states, but from elsewhere. and one of the things that we hope to be able to do over time with the science without borders program is use what is really a student exchange program to build relationships between institutions, between universities and to use that to facilitate the movement of faculty, to facilitate the movement of services and eventually to break down the closed-shop nature of universities especially when it comes to things like credits and degrees so that they can be shared easily. ..

i want to be able to do here is to recognize the seriousness of the issue, recognize the impact that it has had on their relationship and especially on brazil and's understanding of that relationship but putting it in the context it does not overwhelm that relationship because i do not think it should. obviously it raises an imagery

of different -- when i talk about it cast a dark shadow on the relationship and others have used works like trust and respect and obviously we have to address all that in some fashioned. but at the same time i believe that of the brazil end of this has been executive for political purposes not by of the brazilians themselves but by snowden's handlers and that ultimately we are in the position with the brazilians because of this first of all to rethink the intelligence relationships because that is something they do very poorly right now largely because their own internal history and because of the relative smallness of its intelligence but a recognition that brazil doesn't have an

intelligence service that matches its ambitions and to do that it needs to build liaison relationships with global intelligence services that are capable of halting it do that kind of things and provide the kind of services to its own government and ultimately, it is going to need -- brazil is in its interest in what's happening inside of prez sell brazil and it is the subject and the object of the cyber assault everyday and brazilians know this and so they are looking for the capacity and as they go around there the economy and it is our hope that of the wealth cricket - that they have a partner in us and the need to see beyond their

own concerns caused by snowden especially as they look towards the world cup and the olympics. but as i noted and as you acknowledged this is bigger than an intelligence and she will and how the society manages the kind of data in the information hubs and it's going to require a response that is a process that is much larger than the one we have going right now. >> thank you very much for triet arthur and the indications that brazilians are starting to feel more isolated in the tree - use in the formation of the alliance

of the negotiations and others and the comments behind the president reflect some of that and on the other hand he brazilians seem to still be hogtied by their participation and certain kinds of barriers within their own protectionist society to be able to make a breakthrough on trade issues they've been talking with the e.u. and haven't gotten very far on that. that is one of the points that will be most important for strengthening the overall relationship between us and brazilians and i wondered if you can say a few words about that. >> well, we want more trade. we want more investment. that's why brazil is one of the focuses of the president's national export initiative and it's why it's one of the focuses of the select usa initiative designed to bring investment

from overseas to the united states and the year prepared to go to great lengths to achieve than and it is heartening and as tony mentioned it is a very strong push from knowledge and the confederation on the bilateral trade relationship and i'm trying to find ways to overcome aspects of brazillian trade and commerce especially the market reserve policies to penetrate certain markets and i think that in this regard the negotiations that are ongoing burris to the coup between brazil are interesting because i think it is increasingly clear to the brazilians that they have opportunities in europe but being held back for a variety of reasons some of them domestic and we are not calling on anyone

to abandon their licenses this is that each country to make their decisions. but a relationship between brazil and the european union could put someone in the position to a triangulation to triangulate into south america or into the free trade agreement for the kind of agreement one might fashion with brazil. it will be an interesting possibility with a grouping of markets and as we look across in that and to asia for. but brazil has come a long way for a short [cheering] period of time and the first time around from 1892, brazil would be the home of the major

global companies and that it would be a growing investor in the united states and a company would have numerous subsidiaries operating in the united states and it was going to be a major supplier of the aircraft and it really didn't cross many people's minds. and so in a very short period of time they cover a lot of ground that they've got a lot more ground to cover. >> i was recently at the conference in new york where they said something very meaningful to me and i think that i will repeat it here because it helps with the context. so brazil over the past 30 years or so faced and basically build a consensus on over three major challenges. the first was democracy followed

by the challenger around the economic organization. the third one is the social inclusion, brazil has achieved a lot in this expansion of the middle class and then the minister added now it is the time to face the challenge of competitiveness and the other me love is the challenge of making the economy more open economy. we cannot deal with it as you cannot resolve in the innovation issues to become more innovative in the closed economy so i just wanted to add this because i think it is a relative conversation. >> my question is related to

what he was talking about which is how does the recent decrease in the gdp and increase in the economic concerns in brazil affected this relationship that you have come to talk to us about and help us understand. >> i think it is indicative of the changes going on in brazil and the challenge that brazil faces. if you look at what brazil has been able to accomplish it has done a lot of this on a consumer driven growth model. and if that model has kind of run its course and brazil now needs to build a growth model that is based on productivity and competitiveness. as you look out over the brazilian landscape what is striking to me is the challenges

the brazilian economy faces are several. the biggest and the most pressing is infrastructure. in other words how do you build the parts or the highways to the railways and the telecommunications systems you need to move the goods and services and how do you do it in a timely fashion? brazil is the largest exporter in the world but is still can't get all of its product to market or part and i can't get all of its product to foreign destinations to which happily by the brazilian product, so it has a huge infrastructure need that has to be addressed. it has significant human resources means that have to be addressed as it will halt the manager real core and the worker core that it needs to fashion a 21st century economy and has a regulatory drag whether it be

its tax structures or the other regulations and rules that determine how you start businesses and more important how you close business. but these are problems the brazilians understand well and they have advanced dialogue on how to address them and the infrastructure issues and human resource issues are the easiest ones to involved because they involve investment, whereas the regulatory drag is the hardest because it's politically and it involves taking on significant and interests in the brazilian society. and in some ways the president has inherited the toughest part of the economic transformation and they have cleared up this case fiscally and monetarily for

a long term positive growth path. the president was able in his social programs to inject capital into the system so that the brazilians could take advantage of that long-term growth path and profit from it and drive the growth rates that were quite high. but the president took over this model just as it was kind of hitting a wall and so it is up to her to find a new address the challenges probably the toughest of the three. but the good thing is that as brazil has worked through these different parts of the economic development is that it's become very aware of what is happening in the world and some of i do think that brazil is up to the challenges. the question is how fast can

brazil is uniquely positioned because there are very few countries in the world whose growth is entirely in their own hands it's a growing faster and stronger and if it makes them more slowly. i am a former representative of the organization of american states. he has mentioned a couple of times the ulin solution of the

general assembly taken yesterday presented by brazil and germany and also other countries on the right of the digital privacy related to human rights. they fought a lot for that could have a direct impact on the central state of the relationship. the original taxes that were proposed by the initial convene hours or those that offer brazil had to change some aspects of that text to broadly address the concerns. but we will recognize as the revolution does the importance to privacy and the importance of an internet which is seen as a

global public could. and one that needs to be protected. like so many u.n. resolutions, these are designed to capture a sense of the memories of the u.n. and to help provide direction but they are not binding and rarely do they have aspects to them that are implemented but that doesn't mean they are not important to capture a political moment and then needs to be respected and we just think the fact that we were able to work with our other partners but also it is brazil to fashion the text that we could accept was important and i think it shows that whenever brazil's intentions were when they started that process it recognized early on that there wasn't going to achieve everything it wanted to in that process and it had to meet the

conditions that created a better environment for the kind of dialogue that we are having. >> in the latin-american program thank you very much for your remarks. my question has to do with the relationship with other countries in the hemisphere or more broadly. we have worked on some of this together there is broad respect for the strength of the brazilian economy have accomplished there is less willingness to see the leadership in the hemisphere to brazil even though brazil as buyers to use south america as a base for the goebel projection. mexico's strong opposition to having brazil had a permanent seat on the u.n. security

council. they took the reform of each american human rights system and in our time as ambassador if you could comment on how you perceive to brazil's leadership in other parts of the region. >> that is a great question. my own experience is that the tree to be careful in terms of how it deals with its neighbors largely because it recognizes that it has bigger ambitions that are expressed and to a certain extent but especially the larger south america ambition has to be managed with respect and understanding for the concerns of other countries and it tries to present itself not as a hegemonic force but as a coalescing force in the

region. this isn't easy when you are as big as brazil and border on every country except chile and ecuador. they even border but it is a complicated diplomatic dance and it's made more complicated by the relationships obviously that the trade challenges that brazil faces with argentina because they tend to overlook the circuits but the brazilians work very hard at this but in many ways the integration units are from our point of view positive whether it is in the sewer or central america today are the

efforts such as the to the dialogue and exchanges that are ultimately for the well-being. but actually the biggest impediment to brazil that dominates south america is its inability to open up the markets. if brazil could open up its markets or not the speed that they did them it would have done agreements with brazil. and when the mexicans realized they had been organized out of latin america and they were not a part of the caribbean community. the was all about putting themselves back into the region but in some ways the most daring and interesting diplomatic move has been mexico joining the

pacific alliance because it has put mexico back into south america in a way that i think many never anticipated and created the possibility of a connected series of free markets along the pacific coast and facing asia without a u.s. presence. it would ultimately be the challenge is a for long word because brazil tends to address problems by embracing them. so i don't think this is a challenge to brazil as it is something that has to understand and address any way that reflects the interest of the alliance. >> i am here on behalf of the

u.s. travel association and and i want to thank you for your opening remarks about the booming demand in both directions in both business and leisure travel and in that context i think it should be mentioned how commendable it is the enormous effort the embassy has made over the last year or two to bring down really alarming delays in the waite times for brazillian applicants and remarkable progress as you know the we times are down over 90% and it makes a big difference. that demand we all hope and expect will continue to rise and in that context i want to bring up the visa waiver program. as i'm sure you are aware this spring the first south american country will be admitted to the

country after president obama was in brazil the working groups between the two state department for established to set up the so-called ford maps, pre-discussions knowing that the conditions are not yet in place for an actual agreement to lay the groundwork for that. it's not clear to many of us where that stands particularly after the october. in the spirit of looking forward in the consensus that you described here. >> i would be happy to do that as we try to understand the demographics and brazil and what has been driving this surge, obviously the growth of the middle class was seen immediately as one of the

reasons why we were seeing such a sharp rise to read as we look at the issue closely realize because the new middle class entrants were not troubling the united states. they are still traveling inside brazil and the travel on the upper middle class because they have more disposable income and they developed an interest in travel even though they had to run hard as you mentioned in order to fashion the visa process that had waite times from 120 days to today's and, needed those who were traveling to the united states we recognize that there is a whole new group of entrance into the middle class and have yet to attempt to travel the united states.

we know it's somewhere in the middle of the ocean and we know it's not stopping. and we have conflicts through expanding our counter sections and the number of offices we have been building out the windows that we have and building the capacity to produce 1.8 to 2 million a year. but i personally do not think that is enough. if this keeps coming at us. and we could find ourselves back in a near crisis situation next couple of years especially if the economy picks up in terms of growth. the new entrants are able to consolidate themselves in the middle class and that's the way the program becomes very important and one of the reasons why both countries have to keep working at it. it is hesitancy on the part of the government to address the

weisel waiver program. first of all because their experience in portugal is not been a happy one and the end up having people turned around in the ports of entry but it's much better to have people in south paulo that they are not coming in with their families that they have to turn around and go back to repeat the experiences that they have had. the devotees of weaver programs and others that are designed to facilitate travel have the security component and we do want the government to give a thumbs up or down based on the information available and this

is very hard for them to do legally because to dig through the data bases that are not connected right now but to share risk assessments that they doubt they are able to do so there is a way forward on this and we think that they can solve these problems but we think there are some urgency's to it. >> the cost of doing business is quite it could be high gear and brazilians and largely due to the price available another is the tax regime and where to set

up the production. where do they find the aggregate for these and are they making it easier and facilitating the process of doing business in brazil so it's not like a five or seven year timeframe or ten years plus. >> it's not just people coming in from the outside but one of the striking things about that is if you are based in brazil it needs to be addressed to promote not just from helping generate increased growth but also the growing presence of the and some of this has to do with the regulatory costs and legal cost and to the extent possible we have a very large by our standards presence in brazil

fund this operates in the embassy now and is prepared to help those companies that are interested. many of the multinationals come down with their own resources and can manage their way through a lot of these but many companies are coming in fresh many come down with the state delegations by governors there's a great interest in selling into the market for being present but the understanding of how to do it and that is where i think that we can play an important role because we can facilitate contacts and try to look for because ultimately brazil is a country where the extent to which you have the partners working with you is going to me get a lot easier. ..

it does take a long time to establish it up and find a way forward. we believe given the direction brazil is going, given the size of its does not stick market in the platform that it could be for experts into the region and beyond, it is a track or two american industries. again, we have very clear

instructions from the president and secretary of state and secretary of commerce that are number one priority is commercial diplomacy. this is really the priority as new ambassador to the. although i'm not there now, i would recommend you look very closely with the embassy because we'll provide all the help we can. >> yes, paul johnson. thank you for putting this together and ambassadorshannon, always a good two-year utah. we've heard over the years about opportunities for trilateral cooperation between the united states and brazil and africa, sub-saharan africa. what are the prospects for some meat on the bones in terms of trade investment, finance and

from industries like agriculture, infrastructure, just wanted to your thoughts on that. thank you. >> thank you. great seeing you. >> there's lots of possibilities. in fact, we begin our trilateral cooperation and efforts to eradicate the lariat. i've extended that to mozambique, where we are doing important work in the public outside the mass of the agricultural productivity side. we're also working with resilience in honduras and in haiti agricultural productivity and some other projects. this is renew for us and brand-new for the brazilians and working through the brazilian cooperation agency, abc, has been an interesting and for folks area. it is a small agency. it's largely out of -- the cadre

of professionals that one would imagine that kind of the nature v. but it's building them over time. we've created an interesting relationship train usaid brief exchange officers and men sat and abc officers have sat in usaid is a try to get a better deal for how both sides worked and where might be energies and connections. we are quite interested and excited about extending that possibility because we think that brazil, especially on agricultural side and public health care site has some interesting things to offer countries in africa and elsewhere. brazil does have some legal restraints or constraints on how far occurs in this kind of cooperation, especially related to how monies flowed back and forth between the federal government and abc and also how

it does it development assistance abroad. incitement to insist, aad is paying for brazilians services in some of these countries. we think over time, as brazil builds out its government assistance programs, it is going to begin removing barriers are streamlining then in a way in which abc and brazilian government can do more. on the trilateral assistant around businesses, hasan bank has been in discussions about joint financing of projects, especially where there is a u.s. and resilient partner. although it gets complicated to a certain extent by legal structures and rules and regulations can we continue to find a way forward on that because the potential is huge. hello, i might just add outside the private sector and government, the gates foundation has engaged with the brazilian

government ministry of agriculture, abc and a program, ambitious program to send retired distinguish agricultural scientists and economists to help a small farms in africa and foreign practices, very promising after. >> thank you very much. i marker it when i first went to refill in the 1970s, one of the points of attrition between the united states and brazil is nuclear question. more recently mentioned the kerfuffle with iran and the lula administration and so forth.

my question is have we gotten over the previous, that last irritation and at the local treaty of the south american countries possibly a model for the kind of weapons non-proliferation regime we are looking not in other areas. is this an area where we may see more cooperation? >> we are way over iran. we got over that one pretty quickly. i think brazil has been a very useful partner. although brazil is never happy with sanction regimes, it complies with them faithfully. more importantly, you know, i

think that especially under president rousaf, iran had a lot of explaining to do and if it wanted to have normal relationships, it is going to have to be respectful of u.n. security council resolutions and the desire expressed repeatedly by the security council and elsewhere herein addressed the concerns related to the nuclear program. brazil has also been supportive publicly. most recently of the agreement to p5+1 was able to fashion with iran and brazil sees this as a very positive development. but that is helpful. i think in that regard we are in a very good place right now kids obviously, the latin american experience iran nuclear

proliferation and associate agreement between brazil and argentina to end their programs and create kind of mutual verification capabilities was an innovative and important agreement and one that could be useful as we look at how we manage verification regimes elsewhere. but i think ultimately the challenge we are going to face, whether it is in iran or north korea, you name it, is really going to be about verification. and in that regard, oddly enough, this is where intelligence is going to play a very important role because what we have seen over time as especially on the non-proliferation side, intelligence is central to how we do verification work because so much of it can be done publicly and much of it can be done by and check theirs, not

all of it can be. so as we think about the issues raised by mr. snowden, we need to understand not all of it is about spying on countries for immediate benefit. much of it has to do with supporting large international agreements. >> great there. the lady there. yes. >> christina serna with georgetown university law center. thank you for your talk, but even more so for taking so many questions. i have two questions. one is if you could shed some light on why president obama apologized to angela merkel, but not to the room was so for the spying and secondly, that comment may be counterintuitive, gestures have worked extremely

well for the pope, for example and president putin is reportedly considering a pardon for the riot girls and also the arctic sunrise crew. would you consider recommending to the government a pardon for snowden given he is such a thorn with our relations, particularly brazil and america? >> thank you for both of those questions. you know, when the species first appeared, and especially when the allegations of head of government surveillance appeared, we treated the brazilians in the same way we treated the germans, which is quite remarkable given what

other allegations were out there. the brazilians understood this and i think appreciated in their own way because it was indicative of the importance of the relationship. although intelligence liaison relationships with those countries are quite different. germany has much more equity in our intelligence community that brazil does and especially with troops participating in isaf because most of the intelligence comes from u.s. is. but again, i don't want to get into characterizing the conversation president obama had with the chancellor. i will leave that to the white house. the germans have cared or is it in one fashion. i'm not sure the white house would agree with that. but what is important is there

has been communication at several times between president obama and president rousaf about this. there would be communication in the future that addresses the specific issue. and so, i think given the circumstances, we're probably about as good a position as we can possibly be in terms of how we do our leader to leader engagement in and country to country engagement. in terms of unexpected actions, you know, this is race briefly in a 60 minutes piece on the nsa. i think it is clear, vote for him what the says that, but especially from our department of justice has said that he should not expect an unexpected gesture.

>> but may collect a few questions because we are coming to an end now. we have to and then that's it. >> mr. ambassador, hi. i serve twice in brazil with usaid. we talked about bilateral cooperation and opportunities. he talked more about trilateral. he mentioned the opportunities in education and of course we've had major successes in the early 70s with the institution projects with herself linking universities and sending dozens of brazilians and then they've come back another run in those and agricultural health and other areas. you associate to agriculture. wondering about energy, environment, both infectious and endemic diseases. what opportunities for bilateral

cooperation d.c.? >> let's move to the next question. yes, they are. >> house ways and means committee. in bali, we saw a great success at the wto favors plant director general. up until right before that success was singed, it looked as though some of the wto players with which brazil had most aligned itself over the years would be the reason for the failure of the bali discussions. to what degree coming out of bali do you think in fact brazil's view of its own geo-trade leadership is changing from one in which it is a leader of the developing world to one in which it is a broker of some sort between the developing world in the developed world? >> yes, let's come here.

>> thank you very much for your remarks. you mentioned you hope to build a constructive relationship with brazil, promoting common values like democracy and human rights. what makes you feel hopeful that that kind of partnership could be developed and could be effectively developed in our region, specifically south america, where there is a group of countries, particularly other countries that i don't share the same views and missing values in terms of promotion of democracy and human rights. it's critical that brazil plays a more visible role, a more effective role. how do you see that both

developing in terms of working together constructively with the u.s. government in south america? >> thank you airb-america? >> thank you airbus question, please. >> hi, bob kaplan from the americans federation. i don't think a attempt to to answer my question, so oppose it perhaps as a comment. it's been wonderful to hear your remarks on a whole range of subjects across the breadth of brazil issues. priscilla sue said as a continental country. i was wanting to ask if you could comment and some of the tensions within the country for, like with improvements of social inclusion and growth improvements and economic well-being across the country come within the country instead of treating brazil is a single country doing remarkable things, what is happening in the different regions which are given out differential opportunities? >> okay. well, thank you. all good questions.

in regard to usaid, within something remarkable with our mission and brazil because it was on the chopping block and has been several times that are his jury. but we were able to convince our colleagues to usaid here in washington and elsewhere that now is the time to know from a mission effect oubliette development mission to one that is a policy engagement initiative. the idea being that is brazil's economy expands another build some foreign assistance programs that we need to be there working with them in engaging with them on a daily basis with the hope of helping to influence and shape how they did assistance work so that it was more compatible with what we are trying to accomplish, recognizing other major economies out there, and particularly for chinese economy have a different understanding of what foreign assistance is. so far, the dialogue has been

really positive. as i've noted, we've been able to fashion their country assistance programs where we are able to share expertise and funding in order to accomplish common goals. if we are able to do this right, it could create a new kind of development assistance diplomacy that we could deploy in other countries that have emerging or strong economies and are playing an increasingly important role in the breaches. as we've done that, of course we've had to fall back on some of our historic development roles and brazil and largely our aid program today is focused on biodiversity issues and climate change issues. we still do some public health issues. they credit the alternative energy programs, but this does not represent the future of our development assistance program. however, it does represent our

investment engagement. what is striking for me in the area of public health is the degree to which american or mystical companies are prepared to come to brazil and are prepared to do agreements with a zillion companies that transfer significant capacity for brazilian pharmaceutical companies. this is largely driven by the emerging middle class and demand for high-quality health during brazil. i do think synergies are there. they are moving from the development world to the commercial investment world. in regard to the day btu in bali, congratulations. a wonderful job in managing the could of been a disastrous event for the wto. i think he was in everybody's interest to make sure the bali event was successful to the extent possible because having a failed day btu at this point in time would not have been in anyone's best interests.

i think the brazilians felt a special need to play as much of a role of broker is the code. historically, brazil has approached these negotiations with two mentalities. you know, one is to get the best deal possible. but if that's not going to work, then try to assert leadership in some fashion and used the event is a way to assert leadership. i think in this regard, they recognize they could do both. they could act as a leader as a group of countries while at the same time brokering. the bridge that divide and within a luck will be able to maintain that over time. in terms of human rights, that's a great question. it's one of the big struggles, you know, that brazil faces as it moves to find a way to express their foreign policy wedded and to be a democracy in

the region and in the world. historically, brazil has been inherent to principles on interference and self-determination of peoples and has been very reluctant to criticize countries. no matter what they're doing. because at one level it doesn't believe it should come at another level it is quite vulnerable to criticism and is not open the door for a reciprocal attacks. and what's about a certain protection, especially with inciting additional. i don't think that is a stance that will be able to maintain in the long term. as the society globalize this cannot brazil to wonder what it means to be a democracy in the world and hottest brazil express that democracy. the fact that internally got such a strong commitment to an

open society, such a strong commitment to individual rights is a very positive thing to work from. so this is going to be an evolutionary process over time. it's just when we can't give up on. we have to keep focused and pushing on it. as regards to questions in the country, brazil is a huge country, but of all of the colonial entities that were established in the region, it's the only one that's held together of that size. i'm sure there's all kinds of linguistic and cultural reasons for that and demographic reasons for it. but although it is a big country, and a diverse country in terms of its linguistics and accents and traditions and the ethnicity of its immigrants, at the same time there is something

that makes everyone a brazilian. that in many ways is what is remarkable about brazil. although -- even today, people in the southern part of brazil will be dismissive of the northern part of brazil to be dismissive of people at the southern part of brazil. one can find the same thing in the united states. i think what is remarkable about brazil is like the united states, it is able through its diversity to present an image of itself that everybody seems to understand. i just think that is a tremendous accomplishment. >> ambassador, thank you. i would like you for close to imagine some thing which will be the last event of our program. for being here and have

participated in this. this marks the 25th anniversary of the assassination of sheikh on race. was not known in brazil when he was killed. today, should command is in brazil at the national and two for studies, policymaking, amazon, one of the 26 national heroes of brazil and by the brazilian congress. we have associated ourselves to the group of institutions that will host a memorial service this sunday at 4:00 at the catholic church on our website. i hope that those interested can

join us there. with that, i would like to thank ambassador shannon very much for being here with us and i like to thank you for having been with us throughout this year that is closing now. we are very grateful to you. i want to recognize especially to people that have been working with me. michael darden was kind of overworked and -- [inaudible] also working with us. thank you very much. happy new year and please, i would like to recognize the president of ambassador thomas

shannon. thank you very much. [applause] [inaudible conversations] [inaudible conversations]

>> david hawkins is senior editor at "roll call." the senate finishes with lengthy debate. though the process in the filibuster fight is over in january? >> i think they will. just earlier this afternoon, the senate majority whip, mr. dirt and propose carrying over the nominations that didn't get voted on in the past week until the new year and was rebuffed by the republicans. this is usually a plain old courtesy that very few people noticed and suggested republicans have not lost their sense of anger. >> your writing and 2014 about your headline that rollcall.com

and now the hard part, three weeks to apportion. looking ahead into the next three weeks, what is that house appropriators have to work with? >> the grand total, $1,012,000,000,000. so that looks on paper like $1.012 trillion. i think it is the first time we've ever had a discretionary spending budget of $70 trillion. it is obviously an enormous amount of money. it brings with it an enormous amount of decision-making for the appropriators. as many of watchers and listeners now, the way it is supposed to work as congress is supposed to write 12 different hills to apportion out all of the discretionary spending for the year. they didn't do any of them this

year. not a single bill was enacted into law. they only passed a handful. what this means is every single spending decision for the final two thirds of the budget year is being rolled into this one enormous bill. that is quite literally thousands of line items that need to be filled in and hundreds of policy tweaks that need to go along with them. >> a face that jenner 15 column. harold rogers and barbara mikulski have drafted the bill in a take it or leave it measure. what did they mean by that? >> that is their attention. since the timing is extremely tight, their hope is to do the drafting during the coming two weeks when the capital will be relatively quiet. the senate or not this afternoon. the house having been gone for a week. fear rank-and-file lawmakers hanging around to try and do into the process and more

importantly plenty of obvious and not because presumably taken a little bit of time off. the timetable means by january 2nd, they are hoping to have the bill almost done to negotiate the few remaining disagreements by january 6 or 7, when congress comes back, get it through the house by january 10th. get in on the senate floor by january 13 and get it to the president by january 15th, when the current stopgap spending authority runs out. the so-called cr printout. in order to make that tight timetable comment on the right to do that is come up with a legislative vehicle that makes this film essentially look like a conflict agreement, final agreement always been through the process of amendment on both sides can which is not amendable anymore because of how spread out to pick it apart with amendments, there is no way he would meet the jenner 15

deadline. >> what is going to happen when the social issues, policy issues often attached to a cr or omnibus? >> one expectation is that fewer social policy questions will be tackled in this coming on the best and the republicans would want because to do otherwise would be to bog it down. that is the gamble is that republicans will relent on not because they do not want to be seen as pushing this process any further than they have to. in other words, politically and narrative is politically the republicans did not -- did not do much to benefit themselves at the shutdown in a cobra. they do not want to risk having it appear as though they are risking any kind of shut down again for any budget brinkmanship that they will back down and allow the bill to go

through. that's certainly what the democrats are gambling. we will see when these house members are home for the holidays and talk to some of their constituents and conclude what their reelection prospects really are like, whether they combat more voted for confrontation that we now think is the case. >> one more for 2014, february 7 committed that doing day. treasury secretary jacqueline thursday writing congressional leaders, calling for them to extend the byron authority for treasury well ahead of the figure seven day. but the debt ceiling issue be dealt with as part of the spending debate for stand-alone issue? >> it was necessity be a stand-alone is was necessity bea stand-alone issue. issue? >> it was necessity be a stand-alone issue. as i understand, where my reading of secretary of the newsletter, there were maybe a couple of weeks after that february seven to find where he discretion to move money around, to cover the bills.

we are really looking more like the second half of february for the true deadline on ip republicans have made clear in recent days they are going to demand something in return for votes to raise the debt ceiling. they have not made clear what that something is. so who knows. maybe it will be coming in now, my guess is there will be some who will be talking about more restrictions on the health care law would be one obvious candidate. but they haven't made it clear. it'll be interesting to find out what the president's attitude is towards any negotiation over anything before raising the debt limit because as you'll recall, in october, he was not amenable to negotiating at all. >> giving us a sneak preview 2014, david hawkings from a senior at "roll call." you can read his blog at

rollcall.com. thank you for being with us. >> thank you. >> as a moderate in the privacy debate in the privacy world, i've come to a troubling conclusion. the data broker industry as it is today does not have constraints and does not have shame. it will sell in the information about any person regardless of sensitivity for 7.9 cents a name, which is the price of a list of sufferers, which was recently sold. a list of rape sufferers, police officers home addresses, people who suffer from genetic illnesses complete with names, home addresses, ethnicity,

gender and many other fat tears. this is what is being sold and circulated today. it is a dark cry from visiting a website. but it is if they fail other personally identifiable information and highly sensitive information of americans.

>> i was a donor to martha's table, like so many of your viewers. you know, michael and i redo the annual consideration of the things we care about because they were important to us as we grew up, issues we cared about because they match our broader belief, but also the players in our community that we saw doing good work every day. breakfast table delivered hot meals to the little park outside the bill in one decades d.c. offices, nick kersten square. i would see that every night and the lines of people there every night. i knew that it was volunteer driven content thousand volunteers. they had enormous influence in the community they were serving with the great room. i thought, why wouldn't i join that organization, see if i can

put my skills to work, but also see if i can understand better, why do we have this issue, persistent child poverty? why do we have so many children that are graduating high school, going on to college and being able to attach to career so i was able to? >> senate and it's a committee wednesday examined social security and the issue of retirement savings. two witnesses from different ends of the political spectrum agree that social security benefits ought to be strengthened for allowing governors, but they had different views on the fiscal state of the program. ohio senator sherrod brown who chairs the subcommittee recently endorsed to increase social security benefits. this is two hours.

found my [inaudible conversations] >> subcommittee and family policy to order.

welcome ranking member senator tumor and senator isakson. i think others will join us. this is likely the first of a series of hearings that senator to me, i would like to do for retirement security, social security and all that it relates to. i appreciate his cooperation as i do senator hatch and chairman boxes cooperation. senator isakson and other members are welcome to do the same. retirement security in america as we know for a fdr and other stories from the new deal on has traditionally been thought of as a three-legged stool. social security employer-provided pensions and personal savings and investment. for sake of the store, social security is a modest but stable income during retirement years, but it's not just retirement security. social security provides basic financial security in the face of unexpected tragedy. social security provides safety net that is so bold, or thinned

with a retirement plans, often unable to provide. the other two legs of the three-legged school, personal savings and pension plans but upon the bedrock of social security and the standard of living -- approached the standard of living while they were working to protect seniors, but also allows families to use the resources to buy homes to start families and pay for education. their retirement savings, aging parents become dependent on working age children, preventing children from saving for their own retirement, perpetuating the cycle of economic distress for far too many families in this retirement years. far to many workers have been social security is the only lake was standing on the three take its toll. the percentage of workers covered by traditional defined benefit plans, those were you painted a defined benefit likely for the rest of your life has been declining steadily over the

past 35 years. there is now only some 30,000 private-sector defined pension benefit plans down from over 100,000 is 30 years -- less than 30 years ago. from 1979 to may 2011, private workers with retirement plans covered by defined benefit pension plans fell from 62% to 7%. at the same time, the senate participated defined contribution plans much more common now, which inherently holds more challenges or the beneficiary and perhaps others increased from 16% to 66%. only half of america's defined contribution plans have autoenrollment at a time we are told we are in charge of our retirement futures, only one quarter of american workers have automatic access to a defined contribution plan. about half the u.s. workforce is covered by employer-sponsored retirement plan that in half of americans not participating in any employer-sponsored plan.

working families are increasingly squeezed from every angle. wages are stagnant. home values have declined in first many cases. tuition costs for children are increasing at the time we begin to care for aging parents. middle-class and low-income seniors apply on security for a majority -- close to two thirds of families overall. they rely on social security are majority of the retirement income. workers age 50 to 64 increasingly unprepared for retirement. the vast majority of economic games i've gone to the very top of the income distribution of this country, obviously affect an savings and retirement. middle-class workers have a shared economic gains by a larger a larger scene and can associate associated with increased productivity and higher corporate profits, meaning costs go up and the ability to save as a client. the picture gets bleaker when considering racial disparities in median wealth of households

20 times that of black households, 18 times of hispanic households. the highest ratio since the government began publishing this a century ago. the fact or so by most americans have saved only a fraction of what they need for retirement. workers approaching retirement age have a savings of less than $27,000. one third of americans leading up to social security retirement age, 45 to 640 save for retirement at all. the numbers are only slightly better for workers with the retirement plan. in 201010 to 75% during retirement age of less than $30,000 in their iras or retirement accounts or 401(k)s. these facts illustrate how great the need is for a 99 expanding social security, the only source a guarantee of lifetime benefits on which most retirees can apply. social insurance as if

unemployment insurance and medicare. social insurance to pay them. you get benefits out. social insurance doesn't just provide much-needed financial support. and in pictures hard-working middle class can retire with dignity. these modest benefits provided over half their income, lifting over 22 million americans out of poverty. as i said earlier, one third of retirees, social security beneficiaries rely on close to one third are essentially their entire income. the programs not only retirement insurance is family income insurance a momentary benefits go to children what is it disabled. one of 10 children today lives bickering pair. rather than asking how to scale back the program, we should be asking ourselves how we can strengthen it. that seems to often to be the debate on the talk shows us how we can scale back the programs and save money for budget reasons, not the debate which i think should be of how do we

deal with the whole issue of security, financial security, retirement security for people. that reducing benefits or raising retirement age. maintaining or expanding social security is the single most effective thing we can do to prevent poverty and economic rent for senior citizens while promoting economic stability for children and grandchildren so their responsibilities and burdens don't increase to the degree that makes it so difficult. the budget debate creates a vacuum that doesn't take into account the economic impact of social security benefits. mr. biggs and aarp have written on that. your comments will be interesting to hear. social security benefits would decrease our ten-year deficit. i don't bank consider the impact on seniors, families to support them in current committal low-income workers. it's a macroeconomic issue shifting the cost of the federal budget does not resolve the

retirement and savings programs. social security reform should be considered as examination of the burgeoning retirement crisis. i see this hearing is important. what's he up to my ranking member, senator to me. i appreciate his cooperation. we will learn a lot from today's hearing and i look forward to your contribution. >> thank you, chairman brown. i appreciate your having this hearing. this is no question in extremely important topic and we all agreed on the importance of addressing retirement security. as you point out, mr. chairman scum americans rely on three main vehicles for financial security in retirement as a private savings that often come in the form of tax preferred accounts. there's employer pensions which are increasingly defined contribution plans. there's a social security problem. the government policy should focus on protecting all three of these pillars of retirement security. a couple ways we can approach

this would be to recognize the strength of the current retirement system and preserve what works. the other thing we need to do is acknowledge the heart truth about reforms that are going to be necessary to protect programs for seniors depend on. i think it is generally good to adopt the approach you first do no harm. one of the advantages of our current system is the diversity of saving options for this 401(k)s, pretax account, the range of options give taxpayers greater flexibility, more choices and more opportunities to accumulate savings that help them in their retirements. we have to defend and encourage these provisions that help people to save. some have suggested we reduced the amount americans can save. i think that's a bad idea. it would tend to diminish savings. while that would have adverse consequences for individuals attempting to save and provide

for their retirement, i think would also be it from an economic point of view. the most important long-term driver of economic growth is the investment accumulate capital and it has to be accumulated before it can be invested in so encouraging that savings over time maximizes economic growth. a second point i would make is that we've got to make sure social security is going to be there for future generations. it's an extremely important program. you talked about this, we all know this for decades is providing seniors with a guaranteed source of income and kept millions of americans out of poverty. the fact is the program in its current form is insolvent. it's country cash flow deficit position in 2010. and if it's not routinely exceed benefits paid routinely exceed payroll taxes paid into the system by very large sums from which are only projected to grow. i know people often like to

invoke assets in the trust fund, but will probably get into this discussion. there are no assets backing up anything in the trust fund. this is a filing cabinet with certificate that have no real assets to back them up and therefore the trust was to which we routinely referred to nothing to enhance or enable the federal government to honor the commitment that has made. we shouldn't be under the illusion that somehow make things okay. challenges facing social security are not a partisan observation. i want to quote from the social security trustee report of this year, 2013, in which they state an echo, both social security and medicare programs a substantial financial shortfalls that have legislative productions. it's important to grasp the amount of time remaining to enact a financing solution is far less than the amount of time project did before final depletion of social security

combined trust funds. if lawmakers take actions to her than later, more options and time will be available to save the changes to the public have adequate time to prepare. will help officials recognize that for syntax impacts of global populations including lower-income workers and people dependent on program benefits. final point i would make his tax increases don't solve this problem and would be a mistake to go down that road. actuaries have even analyze the proposal as some have suggested that we completely lift the cap on income subject to the payroll tax. that is a radical idea to change the program that fundamentally and in the process, to sever the link between taxes paid and benefits received. even if that radical step or take him, would only provide temporary relief and the cash flow deficits would return. i thank you for agreeing to do this hearing.

i'm looking for to hearing from witnesses having discussion. >> senator hayes. >> mr. chairman, i'll go right to the witnesses. >> senator isakson. >> i want to thank the chairman for calling this. there's probably no more important subject for us to be talking about. you know, everybody talks about the housing bubbles at the big of a communist retirement security of all. my hometown about fan of georgia, capital city, state of georgia finally face up to the music in their pension fund to make actuarially sound for its beneficiaries the future by reforming benefits, contributions that going to have finally face the music. i want to associate myself with what senator to me said. we've got to preserve those entitlements for which people have paid. most people in america have paid more for their retirement security than income taxes.

they deserve the protection panic congress looking into the future not just for them, the children and grandchildren. as policymakers, we have to be willing to make difficult decisions, but in the context of our obligation to the people who represent. this hearing is most appropriate the solutions are not easy, but senator to me's comments about preserving tax benefit and finesse of government policy to direct people towards more private savings are actually essential because people have to be more dependent upon themselves unless upon government. you need to incentivize the contribution process is easier for them to accumulate benefits over time and capital over time. i look forward to participate in the hearing. >> thank you, senator isakson. let me introduce the witnesses symbol because the testimony. first is rob romasco after a distinguished career. his written on the wide-ranging

impact of social security on our economy. andrew biggs, thank you for joining mr. romasco. resident scholar at the american enterprise institute researchers and devoted career to research and retirement savings and pension issues as a deputy commissioner of the social security administration. dean baker is the codirector for economic and policy research. and i'm attack street treatment of retirement benefits one of the experts in the field. he's researched. mr. baker, welcome. john sweeney, executive vice president of fidelity is advisory services available and retirement security. thank you for joining us. written statements entered into the record. we appreciate you keeping a testament to the allotted five

minutes. mr. romasco, please begin. [inaudible] >> more than 37 million members, thank you for holding this hearing on social security roll one of the nation's most important family protective programs. my name is rob romasco. adam everett to your her an honor to serve as the direct terror. when we think about social security, we tend to picture retired people. they are indeed a majority of those receiving benefits. that alone is a critical important function that social security is far more. it protects working men and women throughout their lives in the risk that can lead to the loss of livelihood such as death or disability. we may not think of social security for family income protection program, but that's exactly what it is. picture this, more than 4 million social security recipients are children.

in fact -- >> as you may fear my closer? punic surely. how is that? okay, thank you. social security pays my benefits to children than any other government program. social security coverage also protects more than ninth and 10 younger workers against the risk of death and disability. something that one in three workers will face before they retire. social security is an insurance policy with an offense worth hundreds of thousands of dollars. social security is critically important for massive children who live with grandparents. without benefits come in many families would sink into poverty. it is disaster relief there for families when catastrophe strikes. less than three weeks after september 11 terrorist attack, social security administration sent the first checks to survivors of workers killed in new york, virginia and pennsylvania.

today, eligible children surviving spouses are people killed and disabled in the attacks are still receiving monthly benefit. picture for a moment you're 33-year-old mother one with a baby on the way he who learns her husband was just killed in accident at work. imagine you have no idea who you're going to feed your family. now imagine the relief of discovered a program to help you support her children until they become adults. that is a blessing in social security in that family was mine. my dad died before he was born. my mom worked incredibly hard as a seamstress, but social security benefit from a survivor benefits as a great help in putting food on the table, close on our backs and a roof overhead. so social security is a genuine lifeline for families for every generation. it's a life and embraced by the young as well as alders. as i travel across the country, people of all ages, especially those over 50 express passionate

commitment to live in the world a better place for their children and grandchildren. as i visit college campuses, students talk about making sure their parents and grandparents are secure and independent. social security coming out and not understand a vital part of the intergenerational compact. we hear sometimes young and old are rival armies in the struggle for finite resources. that's not what i see. i see members who depend on each other. older people helping younger people, baiter one day the young will need to retirement social security every much a senior suit today and perhaps even more. social security and the related store unfortunately social security is a sole remaining dependably. to find employee based have gone

the way of the floppy disk or retirement savings have shrunk. real wages for most americans are stagnant or going down. health care costs have soared. no wonder more than one in three working households earn 212 mike 64 years of age have no retirement savings. half the workforce has no employer-provided retirement plan. for those who do come at the in their 401(k)s to pay them a retirement benefit of less than $80 a month. financial security for many americans is in jeopardy. unless we reserve the current transit stagnant wages, no pension, social security will be more important and in many cases the only source for our families or loved ones. we have to make sure social security strengthened as a critical source of income they can rely upon. we also must help the american public understands social security is not just a critical

piece of the retirement security, but also a powerful engine and our economy. state and local economies, businesses and workers benefit from every social security dollar paid out. at aarp, we just did a report, which i respectfully request be included in the record that on each dollar paid to beneficiaries generates nearly $2 in spending individuals, businesses, adding about $1.4 trillion in total economic output in the year 2012. this output generates tax revenues for state, local and federal government exceeding $220 billion. the discussion in the nation needs to have about social security and retirement is more than about deficit numbers. it's about family protection and community support. it's about real families trying to make ends meet. it's about children making sure parents and grandparents can live with dignity and independently. it's about our parents not

wanting to be a burden on our children. it's about my sister and me have been enough to survive as children so we could change trajectories and make a meaningful contribution. social security blocks to the people who work hard all their lives and contributed from every paycheck. the people who promised he would be there for them and their families. it is a part of protecting our families throughout our working lives. it belongs to the children and grandchildren whose last. it protects all her families today and future generations. >> thank you, mr. romasco. mr. biggs. >> thank you very much, chairman brown, members of the committee for the opportunity to testify with regard to social security, pensions and retirement of the american people. first, social security benefits are more adequate