reconnect education with aspiration to its that simple. you do that with the lights on. we open 65 locations in 100 days. i'm on a tear to do this all across the country in the think we can do that and reshape america. >> good morning. i'm kerry doi with the consortium and employment better known as case in los angeles. i am really humbled to be asked to sit on this council, and it's a great honor, especially when i look around the table and take a look at everybody's bio. i don't know how much i have to contribute to the council on the

but definitely look forward to engage in discussions around policy with regard to financial education, which is a term that we prefer at pace as opposed to financial literacy. because oftentimes implies that people are illiterate. perhaps financial empowerment might be a better term. i was born in, on a pineapple plantation in hawaii where the common term today is in farm worker housing. we were poor but didn't know it because we thought everybody lived like that. i don't member very much in having any choice. but we had the ocean as our playground. and so we would chop down some bamboo and use it for fishing

poles, or use of force beers to catch fish -- spears. in spite of the fact that hawaii is paradise, and because it's paradise the rich people in the world by property as a result, the cost of living gets driven up. to local residents that use laborers service to these rich people, that are coming to know why. so we're hawaii is paradise with the aloha spirit, a lifestyle, sharing and receiving love and welcoming visitors, there is often times trouble in paradise. and then i thought the pineapple truck and ended up in l.a. in l.a., there are one and a

half million asian pacific islander residents. to put into perspective, it's almost double the entire population of the city of san francisco, and more than the entire population of the state of hawaii. we focus on asian pacific islander communities, and oftentimes we get lumped into one category, which we are in the census. but there are tremendous differences between all of the asian cultures. you know, and oftentimes for shock value i tell people that we are blacks and whites that had 400 years of history in the united states to learn to hate each other, japan and china, and with my ex-wife being chinese, ma i can attest that hostilities continue.

[laughter] >> clean it up before you go home. >> i oftentimes put my foot in my mouth. i don't like to do that in public situations, but it does occur. asian pacific islanders in l.a. are spread out throughout the city and the county. and where we open our doors for a bride and services, we don't exclude others, and so as a result, apis are only about a third of our clients who come walking through our doors are we see as many people from el salvador and mexico, from peru

and guatemala. we have as many african-americans as well as africans from africa come in that we provide services to. and so as a result, we have the capacity to speak over 40 different languages and dialects. and one thing that stretches throughout is the need for financial education. and so we started to develop that program. and we actually begin at a very early age, that is preschool, in a deepening learning. dutchman piggy bank learning. 43 and half years old, it requires engagement of a. and so we see that it's not only with individual but we have to work with the entire family if we're going to begin the process

of that financial education. as opposed to reinventing the wheel we look forward to seeing what other kinds of creative concepts can be used to enrich our program so we look forward to participating. thank you. >> thank you very much. on bob clontz t. from boston but i want to thank the president for the appointment. it's honor to be here with this group and to work with secretary duncan and chairman rogers and vice chair, director cordray. i commit this a little bit different i think and others. i've actually been a practitioner for over 35 years. i probably should say over 20 because it just makes me feel old. i am the vice chair of the group in boston called the colony grew. with about three and half and af million dollars of assets, just under 3.4 billion. we do financial planning and

wealth management for individuals and families, their kids. we spent a lot of time with the kids in talking to them. we are the only a t-shirt raa, independent, that's a bit about what it most of the time. in the past i've also done a great a show in boston for 10 years called the money experts. alwayall we did was answer quess for individuals can individuals with little means and little knowledge by first learning and doing the right thing. along the way i created and directed the boston university program for financial planners. it's a classroom and online program and i was the director for over 20 years. it's not the fourth largest certified financial planner program in the country and the largest in a not-for-profit institution. i was also chair of the certified financial planner board in 2010. that's the group that created the comprehensive exam and creates standards for people who want to become certified financial planners.

a couple other issues that i think might be helpful. by way of background from my wife and i recently created and endowed a financial literacy program for all high school seniors, similar to what the cfpb described in the report with metrics for graduation. and really trying to watch it evolve and hopefully all the seniors will graduate understand a little bit about credit card debt, about student loans and about how to do with issues like that as they start their lives and their careers but i would also say i'm the father of four millennials and that probably makes me most qualified. i think this council is exceedingly important. millennials, and i was at all americans, all young americans, they're sitting at a very low level. they have high rates of debt, student loans and credit cards. they need to learn how to be financially self-sufficient and to secure.

the study showed us that. they cannot rely on their parents or the government as they grow older. they need to learn how to invest. not just say but also invest the they've been investing pretty conservatively on a short-term basis and we need to teach them how to invest longer-term. i think all of those are important. what i'd like to see the council achieve, besides we've talked a lot about financial education, it's also practical. how do they get people in this country to actually act? it's not just to learn but to act. act in their own best interest and in society's best interest. so i would like to see doable steps, measurable action so we bring information into the delivery system together. so at the end of the day action is actually taken because it's critical to just inform people, to educate people, that's great. it's a great step but without

the action, nothing really gets done at the end of the day. and as a practitioner, i really understand how implementation can be critical to actually doing good. that's hopefully what i can help contribute here, so thank you. >> my name is ted gonder, i am a millennial with a background in started, entrepreneurship technology, and the viral spread of ideas. it's an honor and privilege to serve on this council alongside some of the thought leaders in this space that i've admired from a very young age. so them also the ceo and cofounder of moneythink, which is the only movement of young people working to restore the economic health of the u.s. through financial mentor and and mobile technology. on the financial mentor inside we've trained just over 1000 college volunteers to mentor and

serve as positive financial role models for just over 7500 inner-city 11th and 12th graders in 30 commuters across the 10 states. through our work in the classroom, have observed that this particular age group, 16 to 18, 16 to 19, is facing a shift from sporadic income to steady income, and a shift from financial dependence the financial independence. these students also face the densest concentration of life-changing financial decisions they've ever had to face, and might ever have to face. we view it as a window of opportunity to administer sort of preventative treatment as was said earlier. on the mobile technology side we've had the honor and privilege of working with some of the world's leading practitioners in these i'm thinking, technology to government and rapid problem

solving. and that has built some mobile technology solutions that are being piloted and rolled out across the country. as the youngest person on this council, i feel a particular humility and seriousness with regard to my roll. my parents were born into poverty, and saved every penny and worked hard, to get a so i could have all the opportunities that they never had. but in my youth i was a bit of a knucklehead, and occasionally squandered those opportunities. and it wasn't until i was 14 and unengaged student, always getting into trouble that a tutor had grown up in ghana, would save money for a plane ticket to come to the u.s. to study and pursue the american dream came into my life and turned my mayors into windows. and this young man was 19. i was 14 but i relate to because he was young but respected him because he was just a little bit

older than i was. and he taught me not just mouth and got my grades to go but he also taught me how to set goals, tonya to think about my life, and my decisions like investment. and so it was natural when the economy collapsed in 2008 and i was in college at the university of chicago to start a small community initiative called moneythink, ma to create a tutoring program that would focus on money skills rather than academics between college students and local high school teenagers. between 2008 and today, that program has grown as a grassroots organization, and now is technology laboratory to be in multiple cities across the country. icing our students help the mothers keep the heat on in the winter by using simple budgeting skills, save money for the little sisters and brothers to get eyeglasses so they can see the board in class, earn college

scholarships, earned recommendation letters from the college mentors to get to know them over the course of an entire year. and it's been an awesome opportunity. some of these students are now my closest friends. these students and many are some of the lucky ones, to be honest. there are 6.7 million young people in the u.s. that are both out of work and out of a job. this represents nearly 2% of today's american population. young people historically struggled to hear their voice heard, and so in my kind of humble post on this council, i aim to represent and channeled the voice. what i hope to achieve is really a win-win for the future. what i hope this council achieve is a win-win for the future. i hope that everyone will come away from this driving student centered technologically

enhanced approach to learning. when you speak the student on their level, they listen. when you put a program in their pocket, like with a smart phone, you unlock new pathways to productivity, prosperity, customized learning and measurement. you reduced the cost to skating. you get real-time behavioral data that can work from lesson to lessen, and to build an evidence-based to attract capital and craft the partnership degrade the cure for financial distress. and even the odds for future generations. so it's an honor to be on this council and i look forward to learning from all of you. >> good morning. my experience with having a millennial sun, if you put it together at 14 your least a year ahead of the average. at least for voice. well done. i'm richard ketchum, ceo of

vendor which is the largest non-governmental regular working with the sec in the securities industry come with a mission of protecting investors and maintaining market integrity. i'm also pleased to be the chairman of the finra education foundation and the center foundation and its many partnerships is focused on her by the underserved americans with the tools they need for financial success. for example, our grant making partnerships with the american library association and united went world wide in which is affordable to commend across the nation. they have levered opportunist engage youth in financial education, open school and out of school and they piloted innovative strategies in the workplace. adult basic education programs in the community colleges to help young adults achieve financial goals. several articles involved with the city's financial empowerment coalition, including san francisco, and i want to just note that i'm pleased that the

treasurer has joined us in this new version of the advisory committee and i think will provide terrific leadership. we also, there are teen financial lives the project known as generation money, generation money is a partnership with the consumer federation of america and channel one. egregious lightning middle school and high school students annually addressing the personal finance skills the most important for teams to master and use in everyday situations. beyond outreach and education we believe the data is critical to refining and directing financial capability efforts where they're needed most. that's why we developed working closely with the treasury and with two earlier versions of the advisory council, the national financial capability study which has been mentioned a couple of times today. each wave of that study surveyed

more than 25,000 american adults, allowing us to fine-tune our analysis for this specific subpopulation, that includes millennial's, generation of americans one thing 1970-1994. the report that we summarize and made available to today demonstrates that particularly and lower income households and households with dependence but really across the board, millennials face special challenges. in one way or another in the midst of education or on just on the other side of it they face the great recession and in tremendous challenges from both been able to find jobs and to work through the issues in that environment. the data demonstrates things are not surprising to you demonstrates persons that are way too much dependent on non-bank lending while they have been, had more access to the

earlier generation to some form of financial capability instruction. they are absorption of that is simply not demonstrated from a testing standpoint. and their exposure as they made desperate move to invite with those who have moved forward even though have before from education standpoint are way more burdens by student loan's both in percentage that all of us in early generations can barely even relate to. so all that i think really demonstrates what has been made, point made across the board, which is we need to the financial capability, education and communication away from accidental, occasional fortunate interactions to an environment where it's focused and concentrated and very much looking to evaluate and identify what works. it's a pleasure to be involved in this advisory committee, particularly with a strong focus on financial capability to use.

>> hi. i'm beth klobiner. i want to start with the two best stories about want about my middle son who is about five or six is all that the time and we're putting him to bed and he looked at me in the eye with big brown eyes and said mommy, i have a question for you. i said what's the meaning of life or babies -- how do i get compound interest? and that's what happened i realize exactly my kid when you hear your mom talk about finance all the time. and i think back to my childhood, my parents were both born in 1929, deep in the depression. they have no money, either of the family. and yet when my dad became a teacher, he was offered the opportunity to put half of his salary into his 40 3-b plan at the time, and he did. and he had -- i think is

probably why i decided to spend got been spending my life talking to young people about these issues come these personal finance issues that is so important. i think today we have a unique opportunity and obligation on this council to offer the president concrete action oriented recommendations. one thing that included me that the time is absolutely right for action. in june the first results of the first ever international financial osha test of 15-year-olds will be released. i hope i'm wrong, but i fear america's scores may be disappointingly low, and signaled that we really have our work cut out for us. previously i was fortunate enough to serve on the council under don rodgers, and basing leadership. and on the council as on the youth subcommittee, and we created an online interactive tool called money as you grow.org.

we went through dozens of reports, research, curriculum and came up with the 20 essential things parents need to teach kids from ages three-23. we have no marketing, ma no pr budget, but the site has had more than 1 million visits since its launch at the white house. it continues to grow at about 25,000 visits per month. the effort when the bible, thanks mostly to mom's passing it around on social media. it was pinterest and facebook. i was thinking of the fact, it was one thing to see a cut riding ice skates and have that go viral, but what comes to personal finance can anyone has written about or talked about it knows it's news when it goes viral. clearly money as you grow struck a chord, and i think it's offering evidence that families are hungry for this information. for the council i have two specific issues i think we can tackle. one for teenagers, one for dollars. first teenagers, college grads

have a much higher lifetime earning potential than people who don't go to college. we all know that. one way to increase enrollment is to get more families to fill out the fafsa, the free federal financial aid application of more than 1 million high school students seniors who should fill it out don't. that means millions of dollars in belgrade which is being left on the table. one recent study found with a professional health family helped to pass within only get more financial aid for that child, but we say 20% increase in college enrollment. what can the council do? here are some ideas to let's bring together partners to create a fafsa core like americorps, peace corps, to teach them develop the fafsa. let's offer college incentives to use work-study dollars to train college students, like what ted does, to help. the president recently launched a terrific financial aid toolkits for high school counselors. let's make sure these high school counselors know about it.

let's support the efforts of the first lady and arne duncan who is bent the champion on financial literacy in this country as well as the fafsa form. is been going around talking to college, high school students about this with the first lady. let's work to make february fill out the fafsa month and get financial partners to spot the psas and accounting firms to help. so that's teenagers. now toddler to everyone knows the real momentum for universal pre-k, the president has spoken about in his last two state of the union addresses and research shows that preschoolers are capable of understanding basic financial concepts. some of those include value in exchange, delaying gratification and making choices. let's get financial literacy content into the universal pre-k efforts by bringing together educators, economists in gaming expert to even banks need to be willing partners.

in 2012, pnc bank teamed up with "sesame street" to create a financial education initiative which showed that such efforts not only teach preschoolers but they found that the parents of preschoolers who participated and watched the "sesame street" show on financial literacy also ended up, the parents into improving their savings as well. it's worth noting that the most visited section of -- is the one for three to five vehicles. we have a real opportunity. right now there's a lot going on in the financial literacy world. the educational testing service is talking about developing a financial literacy test for high school students to particularly focusing on underserved population. plus the financial literacy and education commission is zeroing in on youth in a reinvigorated way, thanks to melissa koide. cfpb under richard cordray is shedding light on paying for college, and he can arne duncan,

a relentless support of all things financial lives a. we need to support all of these efforts. on to a humbled be part of this image and -- amazing council some of the older members and the amazing new members. thank you for listening. >> hi. i'm jose cisneros, treasurer of the city and county of san francisco. i'm honored to serve as a vice chair of the council and turn all the other members working on this important topic. in san francisco we set an aggressive agenda for municipal work in the area of financial and politics. i'm proud where one of the finest offices of financial empowerment in the country and that we get to work with many local and national partners over the years to establish san francisco as a recognized leader in the field. many of you i know are familiar with our bank of san francisco program to seven years ago we launched the bank on program to respond to the need for access to healthy and affordable financial products for our underserved residents.

and today almost 100 cities and states across the country have created your own bank on program in their communities to begin to take a serious look at the role, local and state governments can play in building the financial security of our most vulnerable constituents. since then we've launched a range of programs and services focused on four key areas. first, increasing access to safe and affordable products. also delivering effective financial education and counseling. also helping families save and build assets, and finally providing protection to consumers in the financial marketplace. when we undertake all of these efforts, we focus on leveraging the unique powers of local government to convene the stakeholders involved. to influence partners that we might have engaged on doing this work, and using local government to integrate financial empowerment initiatives right into the systems and programs and services we provide to the

residents of our city every day. in 2011 we started the kindergarten to college program. san francisco is the only city in the country that automatically enrolls every entering kindergarten or in our public schools into a college savings account program from the first day of school. we created hate to see because of local but we believe that every child should start off in the financial mainstream. not shut out in the fringes. and that every family should have the opportunity to save for their dreams. we were pleased to have secretary duncan and chair rogers join us for a working discussion of our program last year, and we were up front and open about it. because launching kindergarten to college wasn't easy. we face many obstacles. particularly in finding the right account structure to automatically open thousands of accounts for five year olds. as well as securing public

dollars to put see deposit into these accounts and private funds to provide matching funds for families. today, our efforts are starring to pay off. more than 13,000 kindergartners through fourth graders in san francisco have kindergarten to college savings accounts. and more than 1500 families have started saving, and so far these families have saved more than $550,000 of their own family money for their children's education. that means our savings participation rate is about 12%, a number that is four times higher than the percentage of families saving and traditional college savings accounts are crossed the u.s. even more remarkable, most of our savers are low income families. for example, at gordon j. lau elementary school, 86% of

students there are enrolled in the national school lunch program. .. >> that go well beyond bringing financial education to the classroom, because there's so much more to be done. we need better products in the market to support young americans and their families in saving and building financial security, and this includes transactional products as well as savings accounts. we need to provide better

financial education at all stages and life cycles including in the classroom, and when our young people transition to college and then, ultimately, to the work force. we need to insure our students can finance their educations without drowning in debt when they graduate. and finally, we need to focus on intergenerational approaches. financial capability is a fam lu affair -- family affair, and we cannot ignore the impact a financially insecure home life has on our young people. so i'd like to thank the president for forming this council and allowing me to work with all of you to make this a reality. thank you very much. >> thank you. morning, everybody. i come to this honored and esteemed council from facebook where my day job is focused on helping brands and companies

market, leverage our platform to market to consumers. but i think the more important stuff that i might bring to this endeavor is focused on the work i do outside of work which is, has been in and around a passion project for me which is charter schools. i had the privilege to open one if brooklyn that open -- in brooklyn that opened doors in 2000 and then did it again in atlanta, both kindergarten through eighth grade schools and both doing extremely well and making a big difference in the communities that they serve in pote those locations. so -- both those locations. so i bring a passion, really, focused on empowering young people and young families, actually, because i think this is a family endeavor as much as it is a young person's endeavor into having the tools to be able to be successful in this world with. so why this council and why am i

honored and privileged to be a part of it, i think it allows me to bring the expertise of my day job and tied directly to my passion projects outside of work. and bring those two worlds together in a unique way. i certainly think that there is no one road to success along this path. i think somebody mentioned earlier on the leveraging of technology and innovation should be a foundational part to this, and i hope that my experiences in most of my working career in those areas can be leveraged in that way. and so, yeah, what do i want us to achieve in we've clearly identified and many people talked passionately about many of the gaps that we see out in the marketplace and how ill-equipped some of our young people are to deal with some of the choices that will lead to the foundations of their financial security in the future, so i'd love to see us really tackle those with the understanding that particularly

now in today's day and age that leveraging technology, innovation, digital, social as well as a communications mechanism and also an empowering mechanism can be a big part of how we do this. selfishly, i'd love to see that happen earlier in kids' education and integrating this into school programs and curriculums is also a passion for me. i'd love -- we've done some work in our charter schools i'd love to see that be a part of the charter that we kind of activate. so i'm humbled by the breadth and depth of the experiences that everybody on this council brings. i'm honored to participate, and i look forward to getting into the hard work. >> thank you very much. good morning. i'm mark morial, and let me thank arne duncan, jack lew,

melissa, we want to thank you, say cisneros and president obama for giving us a chance to serve the nation on this very important issue. i was not, but i am going to tell a little story because i think it makes a point, and this is a true story by a well known activist and social critic who shared a story with a group of us several years ago. he said that he was all of a sudden dealing very ill -- feeling very ill; headaches, back aches, hyperventilation, knee aches, all sorts of health challenges. for the first time in his life. and so as a individualtarian and naturalist, he drank beet juice and carrot juice and kale juice and dud all sorts of 40 -- did all sorts of holistic things,

tried out acupuncture, and none of it did a thing. so he broke down and said, well, maybe i need to go to the traditional doctor. and he went to the traditional doctor, and he was prescribed all sorts of pills and medications and injections and bedrest, and none of it worked. and then all of a sudden he had a conversation with a friend of his, and his friend said, he said, dick, why don't i just pay off all your debts. he says, once his debts were paid off, miraculously, the headache went away, the back ache went away, his problems all went away. [laughter] be and i think the lesson certainly is that debt and poor financial decision making can be disabling to families, to individuals in ways that many of us may not be able to imagine. i just want to make a few quick points. we at the national urban league have been in the business of

financial literacy, financial education, financial capability. i tend to like the term financial empowerment for a long time. and we've been on this journey because we are a due tank, we provide direct services to over two million people each year through a network of 95 affiliates. and in the work we're doing now, we're trying to integrate, if you will, financial education and empowerment into our after school programs, into our job training programs, into our entrepreneurship programs because of the thought that financial decision making in the 31st century -- 21st century has to be a part of every single thing that we do. i'm struck at the financial decisions that very young people make every day. young people have these devices. it's a beautiful thing. it is not free.

it is not free. and with the device, you have the opportunity to make further financial decision making by downloading games, by paying for apps. turn on the television at home, go to the on demand channel, and there is another opportunity for young people to make financial decisions. young people today are making financial decisions at an earlier age be it because those phones are tied usually to a parent or grandparent's credit card, they're making financial decisions not only for themselves, but also more you. so this decision has to be seen in this issue in today's context. not in the context in which we all grew up a generation or two or three or so ago. but in today's world. the very real, real decisions,

the very real financial decisions that young people are making at an earlier and earlier age. so here's where i think an opportunity is. there's a discussion around common core state standards. we're intimately involved in that. that creates an opportunity to integrate, if you will, financial education not as a extra, not as something that's ancillary, but something that is intimately involved in how we teach courses like math, how we help people apply the principles that they're learning in school in real decision making. there's a further opportunity here. director cordray and his work at the new agency creates this whole new world of conversation about consumer empowerment, consumer protection, consumer information. what i think we have to do as a

commission, we have limited time. the clock is, indeed, running. what we don't want to do is reinvent the wheel. i had an opportunity, like several of you, to serve on the previous commission that made a whole set of important recommendations that i hope provides a starting point for what we do. the second thing i think we want to do is keep it real, keep it real. create a set of steps, action steps that can be actualized at the local level by those institutions, nonprofit schools, for-profits, regulators, etc., who really, truly understand the value of impacting this. and thirdly, we need to hear from some young people. in this process i don't know if that says we ought to do a field hearing, but we need to hear from the young people themselves.

high schoolers, college students. get their perspective not anecdotally, not through hearsay, but through some sort of direct engagement with this commission. i think it would be illuminating, i think it would educate us, i think it would empower us, and i also think that we would find that young people know more than we think they know, and i think we'd also find that there's a great energy and thirst for being better educated and better informed about our economic system and the world that they live in and the world that they face. so those are recommendations. but in sum, i'm just proud to be able to be a part, john, and work with all the members of the commission. >> morning. i'm deanna mulligan, i'm the ceo of the guardian life insurance company of america based in new york city. i'm honored to be a part of this commission, and thank you for inviting me. i'm new to the council, but i'm very excited about working on

one of the most important and compelling issues that i think we face for the next generation of americans and, also, as some people have pointed out this morning, for our democracy. guardian is a mutual life insurer. we are owned by our policyholders. we were founded in 1860, so we've just finished our 153rd year as a financial institution. being owned by our policyholders, we return about 70% of our profits to our policyholders every year in the form of dividends. our mission, part of our charter is to provide financial security for as many people as possible, individuals, small buzzes and families -- businesses and families. and part of our mission as a mutual company is also to be of service in our community. in terms of the financial literacy council and what i'm hoping and forward yang's hoping

to the accomplish here, we are a fortune 250 company, and we are a financial institution, and we believe that large corporations and financial institutions can be a force for good in society and definitely contribute to this effort. like everyone else in this room, we have on observed the challenges of americans in the only in managing their money on a daily basis, but in preparing for retirement. and many americans, particularly middle income and lower income americans, are hopelessly underinsured meaning that sometimes their families are unprotected in the case of an early death or disability of the main breadwinner of the family. that's one of the issues that we work on on a daily basis. and as we've been working on those issues over the past three years that i've been ceo, we have been trying to figure out how we can contribute to making

people more aware of their needs and obligations in terms of providing for their families. and we've also decided that we needed to channel our corporate giving and our philanthropic efforts in a way that can serve the community in a very fundamental basis. so in doing so, we decided to put all of our efforts into financial literacy for community colleges, and we have engaged some experts because we're not education experts to help us in doing that. there are many experts in the room, i'm sure we can learn more from you going forward, and we look forward to that. but one of the things that we have noticed and part of what i would hope that this council might be able to address and accomplish, in working with community college students it's not just the education. the curriculum we use, we've looked at many different curricula, are very similar. the basics of what to do and even how to do it are familiar and are easily taught.

one of the issues and challenges that our students have faced is all of the, we'll call it surround sound of their life. so if they can't get to class, if they have an emergency, be they don't know how to -- if they don't know how to open a bank account, if people at home are threatened by the fact that they are suddenly becoming more financially capable, how do they move forward and achieve their goals? so we are looking into how to provide more mentorship opportunities, and our employees and even some of our climates have volunteered to be mentors to the students where we're providing this financial literacy education. and we believe that mentorship wined with education -- combined with education is the way to make this real and actionable. so we very much hope to gain ideas from this council. we definitely want to corrupt -- contribute our expertise and collaborate, and we salute the

idea of this council in terms of making financial education and literacy more real and to implement going forward. and i'm very honored to be a part of it. there's so much expertise in this room it's very heartening to see, and i look forward to working with all of you to make the recommendations of this council. thank you. >> good morning. my name is carol, and i'm president of david soften college -- davison college. we recruit to make equal opportunity real. when we consider candidates for admission, we do so irrespective of their ability to pay, and we meet demonstrated financial need for all admitted students through grants and campus employment. i see, i'm really privileged to be a part of this group.

i see myself, in some sense, as a bridge to higher education. so i would talk about there are four roles that i hope to play on this council and four kinds of conversations that i hope i can inspire. first, i hope i can take the creative energy of this council back to the higher ed sector and inspire conversations in different parts of that sector about how we can insure that all of our students continue the education and financial literacy and financial capability that they should begin as toddlers. second, i hope that we can convene conversations with partners who share davidson's commitment to access to make sure that tall elemented kids understand -- talented kids understand how to get to college, how they can pay for college, why college is worth it and chart a meaningful course for themselves through the institution that they choose to attend. so davidson is committed to

working with partners like the posse foundation and the college advising corps and ed ex and the college board and local schools. we work with cms to develop a pipeline to these talented kids that makes clear why college is affordable, why it's worth it and how their families can pay for it. third and i think most interestingly, you know, the economy is changing rapidly in ways that i need to understand more clearly than i do. and we in higher education need to make sure that the education we offer is actually worth what it costs given the world our kids will enter. our kids are entering a world that's very different from the one i entered when i graduated from the university of chicago, and they need to have had different classroom and experience cial opportunities for the four years that we at davidson have them so that they can succeed. so, for example, we need to make sure that our curriculum is

student-centered and that from the moment our kids arrive on our campuses, they're grappling with questions so that they are prepared to create their own job or to be entrepreneurial in an economy where the job they hold might exist when they enter college. so we imagine the kind of education we offer so that our students develop the talents and capacities that they need to plan for themselves a meaningful life of financial independence and autonomy. this requires thinking about what we to in a serious and foundational way -- what we do in a serious and foundational way within the many different sectors of higher education. and then finally, i think we really need to convene conversations within higher ed about hour institutional role at this moment in our country's history. what is the role of davidson as an institution in promoting an educated work force, equal

opportunity more all americans and a democratic society? we need to take much more responsibility for building strong, wide bridges to k-12 and for building strong, wide bridges to the employers our kids will see after they leave us. so this is in some sense a conversation where we rethink our societal role as an institution. and at davidson we're privileged to be a conduit to the rest of the higher education sector for the conversations that take place within this commission. i can't tell you what a privilege it is to be here. i'm sure i'll learn more than i contribute, and thank you very much for your time. >> good morning. i'm amy rosen, and, chairman rogers, it's good to see so many old friends around this table, and i'd like to welcome our new members. and say that i believe that the white house has really done an excellent job of adding assets to this group, and i'm truly

optimistic that our work will be impactful. also i applaud the team at the white house for bringing to the table not only our friends from treasury, but the secretary of education and director cordray, both great champions of this cause. and i think together we will be stronger and, certainly, much smarter for them being here as partners. for those of you who don't know me, i've spent the last decade or so dedicated to helping those, to even the playing field for all young americans being educated in public schools and assure all have an opportunity for a high quality education. i proudly served as the chair of kip schools in newark where high expectations and great educators are really proving what's possible. i run a global ngo called the network for teaching entrepreneurship commonly known as nfte.

we work from economicically challenged neighborhoods throughout the world to teach them the knowledge and skills necessary to really spark this entrepreneurial mindset that will be necessary for them to be able to plan for successful futures and find or create a job. as john bryant said, connecting school with real-life opportunity or, rather, lack thereof is the leading reason that young people in america quit school. we are currently leading a research coalition to create an entrepreneurial mindset index which will hopefully become an easy-to-use measurement tool and incentivize others to invest in this work as well. as those of you who have been hanging around me for the last few years know well, like marc morial, i believe we have an opportunity through the adoption of a common core by 48 states, and now thanks again to my friend david coleman, a completely reimagined s.a.t.

test to integrate not only knowledge, but actually give young people the opportunity to act on that knowledge directly into everyday classes for every student in public schools. my dream is that this work will become part of their everyday math and english classes. while i have no objections to financial education classes that are currently offered as electives and believe that some are truly outstanding and need to continue to do this work, i fear that exposure to them is far too random and dependent on what zip code and what school a young child happens to be in. furthermore, we have learned the hard way that if it's not tested, chances are it won't be consistently taught. and results of studies such as today's released by finra certainly back up the notion that this hit and miss nature of this work is not enough. through the work of the last council, we have really proven

that teachers and school leaders alike responded well to the exemplars that they can adopt and align with the core and learning concepts into their everyday curriculum. this council can move quickly to take work to the next levels through influencers and real actions. in addition, given the gravity of the issue and the incredible opportunity that technology offers, to echo ted, there is an opportunity for new kinds of tools for schools and perhaps even with more potential, a direct-to-consumer play with the introduction of games that involve real-life decisions, rewards and incentives for millions of young people to engage on their own pdas. this panel really does have the ability to spark the interests of developers, investors, educators and industry leaders to seriously invest in these efforts. lastly, i have spent much of this last year doing a deep dive into the grim picture of employment challenges that will

be facing our young people during the next 25 years. the numbers are moving in the wrong direction in virtually every continent, and with our u.s. youth employment numbers closing in on 20%, it's already three times as hard for a young american to get a job as an older adult. this is bound to get profoundly worse as this flat world gets considerably younger with adding another two billion young people with huge influxes from india, china and africa. there is a direct correlation between those who have financial knowledge and those that are automobile to be successful in the workplace or become job creators. nfte recently did an alumni stud of our u.s. students, all from high, free and reduced lunch program schools and their peers. they stayed in school longer, they were employed at a higher rate, they formed businesses at twice the national average and they just earned more than their

peers. finally, burdening our college graduates with unpayable debt is unfair and immoral. making sure that they can make well informed decisions by the time they are 17 and faced with these choices must happen. this work is critical and will make a huge difference for literally millions of american young people. i am grateful to president obama for again using the bully pulpit of husband office as well as -- of his office as well as his personal time to shine a light and appoint this panel to make progress on behalf of the underserved young people in this country. >> thank you very much. i'm charlie scharf, i'm the ceo of visa. i am honored to represent our company on this council. i'm one of the new members. i'm from the private sector, obviously, and i hope and think that we can contribute to this very important effort. quite simply, financial education shouldn't and cannot be something which is reserved for the few. you listen to the stories that some people have here, and you listen to what we hear as we

talk about people away from this room, and luck should not determine if you are capable of making financial decisions. and it's the financial decisions which ultimately are a means to broader success. savings, not spending beyond your means, using credit wisely, bank accounts, payment cards including debit be, credit and prebade cards and investing -- prepaid cards and investing, we believe, are core concepts and all need to understand these. some are complicated, but they're understandable, and director cordray and the cfpb are working hard to insure that this is the case and something that we're totally supportive of as well. and cute frankly, when you just look at what's happened over the last five years, there is a demonstrated need to move the education process forward within people's lives. proactively helping people be successful and preventing financial problems needs to be foundational in in this country.

as the global leader in electronic payments, visa is committed to enhancing the financial capability of all more thans. we invest in technologies that increase financial inclusion and enable greater financial responsibility. it's both our business, and we also direct our philanthropic efforts towards this. our flagship financial literacy initiative, practical money skills for life is a free program to help parents, teachers, students and consumers of all ages learn the essentials of personal financial management. for nearly two decades, visa has been a leader many developing innovateoff -- in developing innovative public/private partnerships with governments, schools and banks and nongovernmental organizations to deliver free programs that help people effectively learn the fundamentals of personal finance including budgeting, saving, responsible spending and the wise use of credit. to date, more than 30 million

people have been reached through these education programs which are game-based, have extraordinary engagement, and they just work. we partnered with 42 state governments to deliver free financial education games to every middle and high school in each state. we've seen that financial education works and public/private partnerships can be very effective here. fueling sustainable economic growth is the core of what visa duds ever day, and it's why -- does every day, and it's why championing greater financial flexibility is in our dna. sustainability is achieved when there's an understanding of the consequences of people's actions, and we know this can be taught. our deep commitment to financial capability is rooted in this belief. more than 15 years we've been helping parents and teachers bring personal financial education to millions of young americans. i look forward to contributing our thoughts and advancing this very worthy effort.

>> good morning. thank you, chairman rogers, for this opportunity. i'd like to thank, also, president obama and his staff at the department of treasury for the opportunity to be here with you all. my name is ann that maria chavez, and i'm the ceo of girl scouts of the usa which is the largest development organization for girls in the world. we create leaders and have been doing that for 102 years. i think this morning is really important to highlight the fact that these issues around financial literacy skills are more important now than ever. you know, i would like to say that girl scouts has known the importance of facilitating these issues with girls for over a century. and what i'd like to do as a representative of girl scouts is to bring the voice of the youth to this table. you know, i am very, very aware that the average age of my boss

is 8 years old. [laughter] they are very focused on insuring that i understand that the skills they need every day come from the adults that surround them. our organization is powered by volunteers. these are individuals, both men and women, who dedicate their lives to teach these amazing girls that their voice matters. and the girls have taught us that they are not a problem to be solved, but an investment to be made. i would like to also share that we've done a lot of research around girls and youth in this country, and we recently did a report, a survey that was done on american girls around financial literacy issues. so both girl scouts and non-girl scouts. and what it revealed to us, that girls are very confident and optimistic about their final futures, but their current knowledge is not very high.

they know that money's important, but they don't know the financial principles and instruments to use like credit cards and what does that mean. and, unfortunately, only 12% of girls surveyed say they feel confident about making financial decisions. so there's a disconnect. because i've also seen that girls when they do have an opportunity to create revenue, they invest it in credible ways. we run the largest entrepreneurial program for girls in the world, it's called our cookie program. and i they raise $800 million in one quarter of the year. and it's all run by them. and they're investing back in their local community. they're funding all of your animal shelters, your meal sites, your senior centers, the local public parks. and they know that it's really important to give back. but clearly -- >> anna? >> yes. >> you got $28 out of me last

weekment. [laughter] >> thank you. thank you, i appreciate that. so what i would like to say is that the work of this council is important because we've got connect the fact that girls and young men want to invest in this country, but they need the tools and the opportunities to do so. what i'd really like the council to achieve is to really identify and develop strategies to pilot financial opportunities for youth in this country. i also think it's important that we serve as conveners around this conversation. you know, i'm one of hundreds of nonprofits in this country working with youth every day. how do we scale the ideas that come out of this council so they're all focused and moving in the same direction? in addition, i think it's important that we do have the voice of the youth at the table today and in the future. because i see when adults, with all good intentions, get around the table and start creating solution for the youth, sometimes there's a disconnect

if we don't clearly understand what the youth want. i also think that we do need to go out and get a, the voice of the consumer as we say, the youth in this country to really figure out what they want to develop and what they want to be partners in. so finally, i'd just like to say thank you for allowing girls to have a vote -- a voice at this table. i will do my best to make sure we represent them, but also to serve as a convener around these important issues in this country. thank you. >> thank you. i'd like to thank everybody for the extraordinary warm remarks and, again, there seems to be so much passion around them and so much, so many consistent values to continue to come out throughout this morning. so with that, i think we're going to turn it over to melissa to lead us into the next part of our conversation. >> and we are committed to honoring our time with you, which means i am going to instead of giving you a readout from the last president's council, i just don't think we

have enough time to do it and an update on what the administration has been doing along with other federal agencies in support of enacting those recommendations, what i'm going to do -- if it's all right with you, chairman rogers -- is high right a set of themes -- highlight a set of themes, i think many of them we heard from the council members today which can help the gun to set what will be our agenda for council going forward. i think then we can allow a few minutes for conversation and feedback from you all around this table. we are then going to open it up for a small number of comments from the public, and i think we'll be ready to close it out with comments by you, chairman, as well as valerie jarrett when she arrives. duds that sound -- does that sound all right? okay. so, frankly, some of the themes that came out of the prior council but i think are also or very specifically identified in the remarks of this new council include more action steps,

priorities. the first one is enabling more children to attain high quality financial education through their schooling. i think that was across the board. people recommend really focusing on getting financial education into the classroom so that they are equipped with a grounding in basic financial concepts. i think importantly also, skill sets this terms of decision making -- in terms of decision making which have real bearing for the choices they'll be making throughout their lives. a second theme that i think we heard and a priority for us is engaging cities and communities as models for building the financial capability of young people. another theme that i think we all recognize is championing college readiness so that young people are making more informed decisions both about where they decide to go to school, how they're going to pay for that education and really importantly, how they're going to pang financing the debt that

they may take on when they come out. another theme that i think we heard is the importance of leveraging technology as well as innovation to give more young adults access to safe and affordable financial products and services. and then another theme, again a priority for us as well, is enlisting employers to help young employees begin to save early, to manage their budgets and to begin taking advantage of career opportunities that put them on a sure path to financial security. so we have just been joined by valerie, thank you for coming. before i turn it over to valerie, i want to open it up to the council and see if you feel like we have captured some of the priorities that you have identified that you'd like to see us drive towards as a part of this new council. don't be shy.

>> [inaudible] you have financial educations in the classroom on the list, so -- >> top of the list. >> absolutely. >> i think one of the things marc brought up is the idea that we have to be able to really follow through on the initiative of the last council and really build on that so we aren't starting from scratch, and i think that's an important point to continue to reemphasize. >> i think we want to also capture this connection with common core standards in a very specific and intentional way because it's a game changer, and the idea of -- there was a comment over here that suggested that financial education -- i think, amy, it was yours -- doesn't sit kind of outside of this specialty, elective kind of concept for just a few but really be fully implemented, and i think that's important. the other thing i would add is

the unleashing the power of the ngo, nonprofit, community-based organizations community in doing this because so many of us come from that community and are intimately involved this the delivery of financial -- in the delivery of financial education, literacy capability and empowerment services. so i'd add that. >> if i could press my button, if i could just add on to that, you know, i think that the to add to the common core integration is this opportunity with s.a.t. that's now being reimagined, and i do think the leadership at the college board is committed to this issue as well, so there's a moment in time here that we could really dig in. and, you know, while we -- it took us a while to come to the common core realization last time around, the window is shutting in the sense that a lot of innovation is happening now. so on one hand it's late, on the other hand, there's a lot more

opportunity to really promote and work on what's working well. is i think we have to move quickly on that. secondly, you mentioned technology and, certainly, i did as well. you know, i think the last council had a lot of conversations, but we never really figured out how to leverage that opportunity. so i do think that's a really important one, and i'm particularly thankful for the white house to actually giving us some expertise op this panel -- on this panel on that front as well. thanks. >> and the one thing i just wanted to add pre-k that the president has been so committed to universal pre-k, and there's really good research coming out about what those little brains can understand when it comes to basic concepts. so maybe our language could be pre-k. >> and it'd be no surprise that i'm excited about the opportunity to bring cities and local government into this work. we have a number of cities really geared up and ready to engage on a lot of this, not the

least of which our own coalition of cities for financial empowerment, but many others that are working through great groups like the national league of cities, the conference of mayors and many other opportunities. one of the areas we're actually seeing some exciting work on is in summer youth opportunities that are growing in terms of ways that can integrate financial education. >> and you would just like to add that private sector there is a lot of investment from the philanthropic standpoint of private sector organizations and companies that could be harnessed and brought to bear on this as well. and i think the private sector is hungry to learn more about how to best supply their philanthropic dollars to this topic. so i'm very grateful for the opportunity to be able to be a part of that. >> that's a really important point, thank you. >> so, melissa, should we -- shall i introduce valerie? >> i would welcome that. >> valerie doesn't really need any introduction -- [laughter]

i've known valerie all my life. we grew up on the same block in chicago, and i got to know her really well in chicago as a very, very, very successful business leader and businesswoman in chicago. and she knows a lot about the issues that we're here to talk about. you know, her mom is extraordinarily pioneering leader in early childhood education and someone who believes in a lot of the themes and ideas that we've talked about. valerie was the chairman of the chicago stock exchange, she was the leader of habitat which is a large real estate company in chicago, so she got to know a lot about not only, you know, the stock exchange, but also an extraordinary amount about real estate throughout her career. she was on the executive committee at the university of chicago, so the kind of issues we've talked about today of education and the importance of having the kinds of opportunities for young people to be able to go to the university of their choice or the college of their choice, be

able to afford it, those things valerie brings a lot of expertise and experience. and, of course, in chicago she was a leader in all of the issues around economic development and how do you build strong communities and diverse communities throughout our urban areas, throughout then chicago, now she's doing similar work as ap adviser to the president on a national level. of we though that she gives the president, helps guyed him and advise him -- guide him and advise him on all kinds of issues, but she brings a special passion for helping others, a special passion for issues facing disadvantaged communities and the types of challenges that the president has given us for council to make sure that we're bringing financial literacy to disadvantaged communities. so it's just really an extraordinary privilege for me to be able to introduce valerie jarrett. >> thank you, john. thank you. [applause]

it's always smart to have one of your best friends introduce you so thank you for that. and thank you for your leadership. this is very important to john and the other members who have agreed to sign on. on behalf of the president, i want to thank you for your service. this is something the president cares passionately about, and part of it is the experience the president has when john formed -- [inaudible] if you haven't already talked about this -- when your dad gave you stock when you were 13 years old? it made a big impression, and i think it's led not only to to john's acumen in business, but his ability to give back to young people, to make sure that they have the advantages he had when he was young. as the president said, this is a year of action, and he's going to use everything within his power, and he refers both to telephone and also the pen to make sure that we can insure that everybody in our country has an equal opportunity to achieve their dreams. and for our young people if

particular, he's committed to making sure your future doesn't determine, isn't determined by this zip code in which you were born. and so you're going to see in the course of the year a series of initiatives. we had a great convening a couple of months ago with college and university presidents from around the country, over 80 showed up and right now we have over 150 committed to target disadvantaged young people and try to attract them to want to go to college, apply to college and succeed once they're there. so that's on the higher learning side, up even higher than that we had a great meeting with a group of ceos around the country and asked them to work with us to see how we could get the long-term unemployed, give them a fair shot to get back into the workplace, and that's going along well. but we all know that part of our objective is to make sure that from preschool on young people are excited and stimulated and have the, at their fingertips what they'll need in order to be

responsible results. i know cecilia munoz was here talking about my brother's keeper, the new initiative designed to help boys and young men of color not get left behind and compete. and as we face this global marketplace, what's so important now is that all of our young people grow up and have the skills that they need to not only manage their own personal finances, but also be good citizens and give back to the community. and work that you're going to do here is just vitally important. i agree with what amy said. there's a moment right here, we have this opportunity, and we should take full advantage of it. and, you know, it doesn't require congress and that's a good thing, doesn't mean we won't pursue legislation at some point this time, but there is so much that we can do just with those of you who are in this room and around this table and the constituencies that you work with to help our young people become financially capable and literate. so i thank you for your service, and i thank everyone wh who shod up to participate. i think it's great that we have

such a enthusiastic group of folks committed to making sure every child gets that fair chance. so thank you for allowing me to pop in and say some closing remarks. [applause] >> melissa? thank you, valerie. >> thank you very much. i want to make sure that we give the public -- i know that there are individuals who received confirmation numbers. they wanted to share some comments with the council. >> mr. chairman, would -- we could propose that people in the interest of time submit their comments via e-mail? we can, there's an e-mail box, pacfcya@treasury.gov, and i do appreciate everyone who did submit comments and asked to participate, but we'll certainly share those e-mail comments with the council. >> did everyone hear the address? >> pacfcya@treasury.gov.

>> thank you. we look forward to getting your comments, and we will close. >> well, thanks very much. thanks for everybody for staying this whole time and being so attentive, and it's great to be out on time. thank all of the panel members, council members, and we'll look forward to seeing you this somewhere. meeting adjourned. [inaudible conversations] >> and earlier today president obama talking about yesterday's election in crimea and sanctions opposed against organizers of the vote there. here's some of the president's remarks from earlier today in the white house briefing room.

[inaudible conversations] >> good morning, everybody. the recent months the citizens of ukraine have made their vowses heard. we have been guded by a -- guided by a fundamental principle. the future of ukraine must be decided by the people of ukraine. that means ukraine's sovereignty and territorial integrity must be respected, and international law must be upheld. and so russia's decision to send troops into crimea has right lu drawn global condemnation. from the start, the united states has mobilized the international community in support of ukraine to isolate russia for its actions and to reassure our allies and partners. we saw this international unity again over the weekend when russia to stood alone in the u.. security council defending its actions in crimea. and as i told president putin yesterday, the referendum in

crimea was a clear violation of ukrainian constitutions and international law, and it will not be recognized by the international community. today i'm announcing a series of measures that will continue to increase the cost on russia and on those responsible for what is happening in ukraine. first, as authorized by the executive order i signed two weeks ago, we are imposing sanctions on specific individuals responsible for undermining the sovereignty, territorial integrity and government of ukraine. we're making it clear that there are consequences for their actions. second, i have signed a new executive order that expands the scope of our sanctions. as an initial step, i'm authorizing sanctions on russian officials, entities operating in the arms sector in russia and individuals who provide material support to senior officials of the russian government. and if russia continues to

interfere in ukraine, we stand ready to impose further sanctions. third, we're continuing our close consultations with our european partners who today in the brussels moved ahead with their own sanctions against russia. tonight vice president biden departs for europe where he will meet with leaders of our nato ally, poland, estonia, latvia and lithuania, and i'll with traveling to europe next week. our message will be clear: as nato allies, we have a column commitment to our collective defense -- solemn commitment to our collective defense, and we will uphold this commitment. fourth, we'll continue to make clear that further provocation cans will achieve nothing except to further isolate russia. the international community will continue to stand together to oppose any violations of ukrainian sovereignty and territorial integrity, and continued russian military intervention in ukraine will only deepen russia's diplomatic isolation and exact a greater

toll on the russian economy. going forward, we can calibrate our response based on whether russia chooses to's candidate or deescalate the situation. now, i believe there's still a path to resolve this situation diplomatically in a way that addresses the interests of both russia and ukraine. that includes russia pulling its forces in crimea back to their bases, supporting the deployment of additional international monitors in ukraine and engaging in dialogue with the ukrainian government which has indicated its openness to pursuing constitutional reform as they move forward towards elections this spring. but throughout this process we're going to stand term in our unwavering support more ukraine. for ukraine. as i told prime minister yachten yuck last week -- yatsenyuk last week, the united states stands with the people of ukraine and the right to determine their own destiny. we're going to keep working with congress and our international

partners to offer ukraine the economic support that it needs to weather this crisis and to improve the daily lives of the ukrainian people. and as we go forward, we'll continue to look at the range of ways we can help our ukrainian friends achieve their universal rights and the security, prosperity and dignity that they deserve. thanks very much, and jay, i think, will be available for questions. thank you. >> mr. president, are you surprised that -- [inaudible] >> c-span2, providing live coverage of the u.s. senate floor proceedings and key public policy events. and every weekend, booktv. now for 15 years the only television network devoted to nonfunction books and authors. c-span2, created by the cable tv industry and funded by your local cable or satellite provider. watch us in hd, like us on facebook and follow us on twitter. >> agriculture secretary tom vilsack testified before a house

subcommittee outlining his department's $23 billion budget request for next year. it includes funding for food safety, the forest service, research and conservation, crop insurance and nutrition programs for women, infants and children. [inaudible conversations] >> okay. good morning, everyone. subcommittee will come to order. before we begin today, i would like to express to you,od mr. secretary, and to the u.s.i forest service our condolence in the officer who lost his life this week, jason crisp was killed in the line of duty this past wednesday along with his k-9 partner.hris we do appreciate the men and women who serve in law enforcement at the local, state and the federal level, and as they put their lives on the lewin in the line of duty on aut daily basis. mr. secretary, we realize anytime you lose one of your

finest, we certainly have sympathy and certainly along with the forest service and, of course, the crisp family. so i did want to mention thatsyp morning before we got started. of course, this morning we are pleased to welcome the secretary ofwa agriculture, tom vilsack. also along with chief economist joseph galber and also the usda's budget director, mike young. so thank you a, all three, for being here this morning. we start our review of theph department of ag's fy-15 budget request.g basically, we have three goals for this subcommittee for fy-15. the first goal is a robust oversight. as stewards of the taxpayers'mmt dollar, we are responsible forei insuring these funds are wisely invested and properly used. as stewards of the taxpayer dollar we're all responsible for ensuring these funds are wisely invested and properly used. through oversight we can detect,

eliminate fraud, waste and abuse. sometimes we're criticized for focusing on fraud and supplemental nutrition and assistance program known as snap. however this is usda's largest program. according to a december '13 "new york times" article it has an overall loss percentage of 4.07% per year. which is about $3 billion. when fraud and erroneous payments are combined. in addition, snap fraud undermines support for this program, and other federal nutrition programs. i'd like to be clear that i support oversight and elimination of fraud in each and every usda program. including the farm programs, and insurance. those programs should not be neglected to be looked at in any way, as i mentioned. oversight is also about promoting strong program management. usda has had trouble for years securing its i.t. systems.

we heard testimony last week that usda continues to have problems with this. of course as you can imagine it's disappointing to all of us to hear that. we also suggested the agency should rebalance the work and focus on managing their programs instead of just delivering benefits. the second goal is to ensure the appropriate level of regulations to protect producers and the public. this is about usda's -- how they implement laws, including the new farm bill and the 2010 healthy hungry free kids act. at times it appears at usda appears to pick and to choose when it will be flexible to suit its own agenda. unfortunately we have seen the administration go beyond congressional kin at times. i will explore some of these in more detail as we go through the questions. my third goal is to ensure the funding is targeted to vital programs. there are two sides of this. one is about the decisions of the subcommittee will make to

allocate funding in our bill. the other is about the administration priorities. as you know, we cannot fund and do everything. we must focus on programs that are most effective, and broadly supported, and those that are address imminent threats. wic is effective and broadly supported program. we will scrutinize the fy-15 request to assure sufficient funding is provided to meet the current case loads. however, we cannot provide excessive funding that will then unnecessarily limit funding for other programs that are of high priority. regarding rural housing programs, frankly, i don't understand why usda proposes to dramatically reduce funding for them. these programs have broad support across congress as they help low income and oftenaterly americans to have decent homes. and i hope we can discuss this a little more detail as we go through the questions. turning to usda's budget request at first glance it would appear

to be modest and straightforward. it is $228 million below the fy-14 enacted level. however there are several new programs, and significant increases in funding for others. some of these increases are offset by questionable decreases. such as the closing of 250 farm service agency offices and the reduction of 815 staff years without any real background on how you arrive at the savings. there are major increases, including three innovation institutes, costing $75 million, and huh dwrndreds of new staff the rural development mission area. in addition the budget proposes major changes to crop insurance program with the goal of saving 14.3 billion over 10 years. this is clearly an authorizing issue and the 2014 farm bill just spoke to it. while many believe that this program could be improved it is not realistic to pay for

increases based on proposals that at a minimum have to be addressed by the authorizing committee. in closing, i must mention the president's separate and additional $56 billion request. the opportunity growth and security initiative. while it would provide $277 million for us .. agreed upon discretionary cap for fy-15. chairman rogers, who is with us here this morning has definitely stated that the house will write its appropriate bill to the established accounts of just over $1 trillion. senate appropriations chairman mikulski has said the identical same thing. the additional request also is irresponsible given our debt, our deficit and our overall economic situation. while the federal budget deficit has fallen sharply during the past few years, the congressional budget office estimates that under current law the deficit this year will be $514 billion.

so even after all the tough battles to reform spending, deficit spending this year will still exceed spending on all nondefense discretionary dollars by $22 billion. cbo further projects that under current policies public debt will reach $21 trillion. and that is 79s% of our gross domestic product by 2024. i think if you look at those numbers, they are very staggering. before i recognize you, mr. secretary, for your opening statement, i would ask the ranking member of the subcommittee, the distinguished gentleman from california, mr. farr, for any opening remarks that he may have. mr. farr? >> thank you very much, mr. chairman. and indeed, it's always a great beginning of the year to have mr. secretary here. your department has awesome jurisdictional responsibilities for all the food in america, for all the development of rural

america, and essentially for all our ag interests around the world. and i think, frankly, with your background as a mayor, and a governor, that you really know how to handle your job well. i think you do a very good job. i would be interested in a comment or two. last year we were able, in this tightening to give flexibility to the department of defense in how they spent sequestration funds. essentially rather than just us putting it all in a category, and across the board cuts and things like that, we gave them the flexibility to make those determinations. and i'm wondering if there's any unfunded balances that -- unobligated balances that you might have some ideas about how to use your -- give you some flexibility to use those in a limited budget as the chairman indicated. so, i have lots of questions. it's a very exciting department.

and essentially i think a lot of us are here because it's also the biggest department in the united states government that handles poverty in america. and overseas. and i >> thank you. also, we have mr. rogers from kentucky and i would like to recognize him with any remarks. >> thank you chairman and thank you for allowing us to start so early. we inherited a top at the house and senate appropriate and we are not dependent on waiting for the budget committee. we are ahead of our severals and will continue to go that way. ourselves -- and we will

continue to do the 12 individual bills separate with the senate. let me thank you, mr., secretary, for coming to my district to help announce as you did the strike force program of the department to try to help rural communities combat the difficulties they are in economically. the strike force we are incorporating in kentucky with a program the governor and i announced spall shore, shaping our appalachian region, and it will attempt to find new ways to make livings in a formally coal-dominated part of the country. ranking member lily and i have

committed to moving all of the 12 bills through the subcommittee, full committee and the floor. we plan to move it along at a brisk pace. ing i think you are the fifth secretary we have had on the hill. we plan to move along briskly. unquestionablely, this is required to correct bills that spend thousands of billions. the package passed in january that funded the balance of this year is a prime example of what we can accomplish together. this committee was able to provide every facet to the federal government with adequate responsible funding while continuing to reduce federal spending totaling $165 billion

in cuts since fiscal year '10. we had to take a lot of late nights and complying but we got it done. we have to tackle mandatory spending. it is 2/3rds and growing and squeezi squeezing out everything else. we had to reduce defense spending and everything else because of the crowding out the mandatory is causing us to deal with. so mandatory spending, 2/3rds of the spending, is the problem. i see no leadership from the

administration to tackle problem. and only 14% is what we sit down and decide how to spend but the rest on automatic pallet and that is no way for a government to be operated. and above all, you experience that as governor. your budget proposes to lower both mandatory and discretionary spending within the department, but we see this before and we see you allow efforted on mandatory spending blown but by the end of the year. so it is time to get serious about the mandatory spending crowdout that is taking place and have an honest about how about how to deal with it.

once again in this year's budget, the request proposes a significant cut to the section 502 direct loan and mutual and self-help housing programs. we have seen this smoke screen where funding is cut for useful programs in order to make new spending and create the illusion of budget savings. this shows disrespect for rural companies and the people who made these programs successful. a group called kentucky highlands in my district there itself-hef housing program has completed 20 homes and has six more under construction.

one woman finished a 3 bedroom home for $98,000. using a contractor the same home would be $145,000. the rental home where she lived it was so poorly insulated she kept the heat at 55 to keep the bills down to $500 a month. they will average $100 a month now. another mother build a four bedroom four. $102, 000 a contractor would have charged $145,000. it wouldn't have been possible without these programs. it seems to me this is the sort

of thing we should be encourai encouraging. and there are people who are more than happy to put in the effort to own their home. so i hope we will support these programs with more emphasis. secretary, we look forward to hearing your testimony, and welcome you to the hill and thank you for visiting in kentuc kentucky. i yield. >> and we have the ranking member and we would like to recognize you. >> thank you chairman idaho and it is pleasure to welcome secretary tom vilsack here. we are lucky to have someone of this caliber and experience.

thank you. your department plays an important role in the nutrition assistance for rural areas, research to improve crop and yields. the range and scope of the usda's jobs is amazing. i was happy to see funding for wic and the new rule that provides more money for the purpose of fruits and vegetables and makes other important improvements. with 15,000 served per month in new york this program is vital to the health of young women and their children and i applaud the

department for issuing the new rule. i oppose the $66 million cut to the food administration, but i support using 20% of title 2 resources available in cash for emergencies to use the money to help countries around the world like syria, central south african republican and south sudan with the same resources. i look forward to continue to review the budget's request to fund initiatives to combat

hungry and support sustainable agriculture process and keep up with the food supply. >> if anybody has electronics, if you could put them on silent mode. and we understand we may have votes called, so we will have the take questions or your statement as long as we can, and then we will do a temporary break to go vote and we will be back for more votes so everyone is welcome to back after after the vote. secretary, tom vilsack, without objection, your entire testimony is included in the record and then we will recognize you for your statement. >> thank you for the opportunity to be here this morning. let me start by focusing on the impact of this budget on real people.

40,000 farmers, 85% are beginning or socially disadvantage farmers, will benefit. crop insurance covers $63 billion; avis protects $165 billi billion. and the foreign agriculture service will support $140 billion in agriculture exports that help support nearly a million jobs here at home. the food and nutrition programs will benefit 47 millions under the signal program. 8.7 under the wic and nearly 3 million young people during the summer feeding programs. the food safety budget will provide assistance and health in protecting the food supply is

reducing 52, 000 illnesss. and helping half a million producers conserve soil and protect the water. it isn't specifically related to the budget, but overall the budget supports grassland and forest and it will protect 70,000 communities located within the urban interface and the 45 million homes in those communities. rural development will support and maintain 44,000 jobs. our rural utilities will provide service to 4.6 million. 2.2 million received better water and sewage.

144,000 households get expanded broadcast. and 166,000 people will have the dream of home ownership with this budget. the budget authority for housing increases. the cost of borrowing is why it is difficult to keep the program levels in the past. we are not cutting, but the cost of lending is increased. 13 million people will benefit from community centers like police stations or fire stations or hospitals, libraries or schools that we invest community resources in. and our research facilities will support hundred facilities in the agriculture research centers that are involved in 800 research program and supported

215 patents and 285 license agreements. and the national agriculture competitive grant program is supporting the land grant universities, black colleges and universities, and hispanic colleges and tribal partners. we are focused on results. and we are focused on reforms. this budget has a number of forms including the ability of modernizing farm service offices so they can better hand handle challenges faced. we will continue to focus our efforts in reform on our rental assistance program so it continues to support the 285,000 families that benefit from our rental assistance program.

we need to right size that program and we need additional tools to do that. given by actions taken by congress in the past that have created a difficulty to fit rental assistance in the budget. we will look at ways to improve our services through a series of reforms outlined in the budget including the development of a rural core which is 150 experts who will look at the areas of most persistent povterly a-- poverty and amplify the programs discussed. additional new market opportunities for businesses as well will be provided. and we will take advantage of the new farm bill that passed

and creates an opportunity to expand rural manufacture. 14% of manufacture is relate today food and agriculture and we want to expand on that. this bill focuses on innovation as well. anti-microbes and also new ways to pollinate will be looked at. and we will focus on an effort to do a better job the challenges the poultry industries face with disease. we have antiquited services and we need a new way to address the challenges to the infrastructure and we can do that by taking a

look at the balances so it will allow us to retain them and use them to upgrade our facilities. this would give us an opportunity to better manage and reduce the 70 million square feet of state we lease, operate own. -- space -- i think if we right size the rental properties in the capital area and improve lab facilities we can save a lot. we need a resource that is predictable and one we can budget from. that is difficult. reform and results and opportunity and innovation. it is about half a billion less than it was when i became secretary.

so we have and will continue to manage the budget in an appropriate way. two comments relating to comments you made, mr. chairman. we are proud of the work we are doing on supplemental nutrition assistance program integrity. fraud rate of 4.7% is at record lows. we have aggressively pursued integrity in the program. over 733, 000 investigations and interviews were conducted to ensure the integrity of the program. we are suggesting on additional benefits to focus on these programs and the crop insurance program where the error alone is 5%. we think we are doing the job of oversight and integrity and i

would say we are working on on securing our it systems. we had 17 emails systems when i became secretary and now we have a single system. that is part of the $1.2 billion we have saved. i look forward to responding to the questions the committee has. these are difficult budget times, but there are significant results coming from the budget and we will work hard to make sure the people of america, rural and all, are served by the usda. >> we will proceed on where it will be another 15-20 before we have any votes so we will proceed as long as we can and return after the votes. let me sort out with something that was in the fy '14, langwing

was included to direct the fda to develop a waver process for schools that are finding the school breakfast and food comply is too pricely. we asked that you work quickly to put the waviver into place ad let me introduce a paper that supports it and says since the passage of the healthy, hungry free kids act school food authorities have continued to take pride in providing tasteful meals to 30 million children. we need a waiver to allow

certain schools to have more time to prepare their districts, schools and students. you sent a letter and i just received it this morning before walking into the hearing. could you tell me about how you could possibly implement a waiver like that? >> mr. chairman, i appreciate the question. school districts have received a 6% increase as a result of this act. 90% of school districts embraced in the healthy hunger free kids act and nutritional standards are improving. we are focusing on the 10% having difficulty. we want to help help. the richard nelson act makes it impossible to provide us to

waiver you have requested by express language in that statue we are prohibited from granting a waiver. i will quote: the secretary may not grant a waiver tat increases cost or relates to nutritional food severed or the sale of food. we are trying to help those districts. we announced $5.5 million in grants under the smarter school lunch room program. it will provide $50,000 to each state to assist in competitive grants up to $350,000 for districts and department of education to assist and help the other 10% of schools having a more difficult time. where there has been an

opportunity to be flexible as in the case of protein content of meals. we proposed changes and made them in terms of protein and portion size permanent. we will continue to look for ways to help the 10% of schools having a difficult time, but unless this law changes, i don't think i have the statutory authority to do what you would like. >> we are getting feedback from the schools they want to see a waiver. they are searching for are relief. i do note that the farm bill explicitly prohibits usda from advertising and recruiting for snap but you are saying you will find a way to make sure people know. i could think maybe you could find creative ways to implement

this waiver. and the intend of the language isn't to permanently wave the standards. it is process to delay and give more times for schools to comply with the regulation. u is -- usda did this for the breakfast rierm requirements. i quote it provides additional time for the school breakfast program and modifys those that reduces the cost changes as compared to the cost. these are not going away and i hope you are willing to work with us. >> we are willing to work with you. i think the law is clear, but we

are more than happy, and i think we have shown a willingness to be flexible. i would point out, i think the snap situation is a bit different because there is a difference between educating and advocating and congress was saying they don't want us to encourage recruitment of people that qualify for snap. i am not sure it prevents us from educating people about the program. only 52% of eligible folks participated in the program and that is because a number of states are not doing a good job of knowing the program exist. today it is 80% participation rate. so we will work with you on waivers and flexibility.

>> i'm hearing a pushback and schools are very concerned. i want to relate that to you because as a representative and hearing from the schools they are very concerned. >> thank you very much. there is a lot of concern and it is because if you look into the law i have on the idea of getting nutritional food to the children in this country is absolutely a smart thing to do. congress has micromanaged this program where every child to walks into the lunch room has to be means tested so we can tell which kid is getting free or reduced lunch. then we go on to dictate the portion size, nutritional

content, and last year because of the special interest in the potato lobby worked out language between the senate and the house to make white potatoes a nutritional item. and we asked you in our legislation the language saying we expected you to amend the rules to include white potatoes. we asked for a report from you if you chose not to amend the rules. i think the secretary read the report and we never got a chance to hear your