>> first of all i think the inversion critique is an odd one. i hate it. it's terrible.

it's just a terrible precedent. it's really awful. it's going to do all these distortions and then it's not going to do anything. i don't think it's going to do as much as i like it to do, as much as, say, lebanon or schumer or some proposed legislation which is right with you tax partly. or i should say the optimal way. the absence of a functional political system of congress can get around those obstructionists and work together, i think administration has a very important responsibility to try to protect the tax base and will be negligent if they decide not to. which brings me to another disagreement, territoriality is somehow the long way to go. i would point out to listeners of this discussion, a very important initiative that's being undertaken by countries

called beps, continually trying to adjust to avoid the very kinds of these erosions, base erosion & profit shifting. this country to country to how an ecosystem they can avoid the pricing problems that the cab report articulates. so i would be quite weary of moving towards a system like that what looks to me like other countries are recognizing it as a key source of the easy road. finally, if you listen to the discussion of all the problems with the corporate tax code, and those problems are real and their deep and its way to complex, you probably don't need to know anything more than the fact that ge, which only for my group made toasters and jet engines, has a thousand tax lawyers on staff. it's critical i think to

recognize that american corporations have never been more profitable, that in 2013, last full year of it, corporate profit share with heisenberg going back to 1929. not only have they recovered from their losses and a sustained large losses in the downturn, but they've surpassed their prior peak. that doesn't mean our tax code doesn't need to be fixed. i myself have emphasized many important fixes to the corporate side of the code. but the idea that corporations are somehow being deeply thwarted and competitiveness is completely belied by the data as well as the deep erosion in the base. >> back to inversions and that i let go particular court the treasury actually proposed, they are proposing that they have the power to recharacterize transactions that were taken before a merger and acquisition and national it, some after.

and in some cases with arbitrary numerical guidelines that are found on nothing that i can identify. some cases simply judgmentally by the treasury staff. i don't think it represents the tax code. it will create a lot of uncertainty in companies who have found economically beneficial merger acquisition partners internationally. i just think that's a bad precedent procedurally and his bad tax policy. >> okay. >> i mean, let me agree with one thing. here's what i don't like about it because again, it's second best, administration would be negligible not to take these actions in my view, but here's what i do like and don't use toward precedent. next administration comes in. it may be administration of the of the party. i've been in these administrations, one, at the beginning and one of the first things you do on day one, too, or three issue reversal of

executive orders you don't like unless guy or gal who was in the place. if you start doing that with the tax code, terrible. so i take your point, but i don't think the administration can finally sit on its hands and just allow this jogger not to occur without doing something. -- jock or not. >> i suppose we could spend all time talking about inversions but i think you made your point and i will not weigh in. you probably don't want me -- >> go ahead. >> so in any event, we are going to talk about politics. we've been through talking about that kind of entered dispersed, but let's say i have one more substantive question. should we be thinking about new taxes like fat or carbon tax or transaction tax or something else, or are those just so off

the map these days we can't even talk about them? >> to me to go first? again, i think it's so far off the map we shouldn't talk about it is really not the way to think about this. we talked earlier about the 86 reform. that had like a four year runway or somewhere between two and three. it had a long runway. so sadly nothing wrong with toxin about aspirations. i see some things, i would disagree with text contention earlier that anything that is a new tax is putting words in your mouth, you will correct me, anything that the new tax sort of by definition should be off the table. i don't agree with it. i think there's something, one of the things while i stress the importance of neutrality, that is not having a tax code that incentivize decisions to tax

avoidance versus market economics, so inversions will be a good example, i do think there are negative externalities within any economy with attacks could complete an important corrective role. we've had, i've written about this if folks are interested in following up. we've had a significant increase in dark pools fueled by high speed trading, high-frequency trading come which looks to me like a country that's nothing to productivity, and contributes to volatility and the lack of transparency in financial markets creating some of the volatility that is pushing some of these markets off the rail time and again. a financial -- would be a good idea. i understand three basis points financial transaction tax raised over 300 billion over 10 years. that's real money. i like that idea. the only thing, just an

asterisk, give doug a chance to respond, i hope you can toggle bit about in this space about extenders. i think that's actually where we're going to see some new tax policy discussion pretty soon. >> okay. >> i didn't say anything about no new taxation, but i don't think anyone should even consider a vat. i think it's a political nonstarter. i don't think that. >> there's a very nice thing on a blackboard called a vat, progressive consumption tax is really progressive vat but if you say that it's over. so i didn't say that. >> understood. >> second is i believe when you lay down the principles of tax policy issue tax real economic activity, the consumption of goods and services, the way

journeys of people, supply live, the capital income, take your preferred income or tacking -- taxing real economic activity for the purpose of raising revenue and tax financial transactions as much as you can because it is the taxation of the financial transaction, particularly differential taxation of returns to capital, dividends, interest, capital gains that transforms the cancer savers of tomorrow into tax was an account. that's a big problem with the current system. i wouldn't do the financial transaction tax. you're going down the wrong path. that leaves a carbon tax. it's a consumption tax. i have no reason to oppose consumption taxes. there's an enormous literature that says that if you want to do something on carbon, that the most economic efficient thing to do is use a carbon tax. i'm all for that.

if it gets in there, to let the payroll and the corporation income tax, that's what the literaturletter says you should. makes a lot of sense. it solves a political problem in a very clear way, which is there is no we'll ever get a carbon policy to pass on the stand-alone vote in u.s. congress in the foreseeable future. it's not going to happen. in the same way you're not going to get most of jared's friends to get the corporation income tax down to five, 10%, my kind of numbers, but if you drag a concerted to the carbon policy because they need to get to five or 10% and if you drag the progresses to the low carbon radios created a subclass the coalition of the dredging that walks away, irritated but the deal gets done. that's the only scenario i foresee were one of these things happens. >> other than five or 10% you through in their, there's a lot to like in your wrap.

let me ask you about a tiny little corner just to see where you come -- >> so we also like the carbon tax, good. good. >> here's the wrinkle on that that kind of interesting because this came up a few weeks ago. carbon tax i would argue is pretty far from the table. >> right. >> so there was a discussion to increase the federal gas tax, 18.4 cents a gallon since 1992 or 93 or something. interestingly there was a bit of a democrat republican coalition, or at least a couple of members from the opposite side of the aisle who proposed an increase in the federal gas tax, which is a dedicated tax to fund our highway infrastructure, which actually believe in something eric has written about. i think such dedicated taxes are smart and good policy. nice connection between what you're doing there at the gas

tank and which are driving on when you go on the highways. i thought this was a very good, smart idea. now, i will say to my chagrin, the white house was not very embracing of it at all and it is typical of politicians run away from such things because what's the one thing every sees everyday? it's the gas price. i thought that was a nice little corner of the carbon tax debate that had some promise. i wonder if doug agrees? >> this is likely going to be a big issue. he does we sort of wandered into a key moment of choice on the future of highway finance. third edition has been, let's finance it with the user fees, and the use of these that the gas tax, have a user pay model for the finance. that's really not what's been going on. we are increasingly using general revenue transfers into

highway trust fund so it's become part of the general financing of the government. and rather than have it happen by accident, i think the congress needs to choose. one model is have the user fees and get a user fee that can fund the mr. investments in a sustainable way, or put in the general appropriations fun and say we're going to make highways can be with all the other nondefense discretionary spending needs and funded out of general revenue. but there needs to be a choice. what's going on right now is not good policy. if you're going to go down to user fee route, there are things that are much better than the gas tax. there are very, very clear advantages to vehicle miles traveled. they can be differentiated by axel waits and actually really more closely mirror the harm inflicted on the highways for which are pay what you damage. those are places to go but i think just raising the gas tax doesn't solve the fundamental

question of our going to finance this doesn't get the right user spent if i were bill clinton, don't let the best be the enemy of the good. >> i just give you an example of republican and democrat who in this climate came together in such as what i think is a smart -- using that's not optimal because it's better to have vehicles traveled from upper that wasn't the rum of the possible but it was discouraging to me that i was a very lonely boys out there trying to boost that today. i don't know where you guys were spent we weren't really too involved. why have a trust fund if you can do that? >> i guess my point was not to argue against compromised. i started talk but how important it is, but let's know what we're

trying to accomplish at the outset. >> i agree with that. >> that's a fair point. >> okay. so i would like him we'll have but one is left so like to open up to the audience for questions. >> somebody asked about extenders. >> you can talk about it spent i wrote tax notes life get a bonus but every time i talk about extenders spent let's just fire up the recorder otherwise this is a pointless exercise. so great discussion, really interesting speakers could you identify yourself? >> tony, i write for tax notes. my question is, this is kind of a very big picture question but hope it doesn't just turn into vague, like it would be nice, i really want to know what you guys think in terms of the realm of the possible like we're just talking about. if tax reform so difficult anyway, why not just swing for the fences and just try to remake the system in a

fundamental way instead of doing something incremental? it's going to be hard to matter what. this is kind of hypothetical, but what do you think? >> i don't think it is hypothetical. so how does tax reform get done? in my view, the universe. number one, lots of public education as i said. it will need to be cognizant of what's wrong with the current system and buy into the fact that when you change it, it's going to put all of them. you have to do that. number two, an essential piece is white house leadership. the white house has to take the lead because only the white house is positioned to make sure the other party, you know, says this is necessary to begin. they say we won't sign unless that's in. said to them, look, we will take care of you, campaign freedom raise the money, sponsor total migration to whatever is important to you.

you know, only the white house can make that go. so white house leadership is essential. the therapies, 86, what did they do? the treasury, eric, wrote a transformative plan. it was as close to an income tax as you could probably get. and it swung for the fences. it swung hard enough for the fences that the white house itself was made a little uncomfortable, at the white house modified it and send it up to congress. that's an important step because if the white house isn't sending up something, congressman can go and say look, i do want to do this but the president asked, you need that. you need to give them cover. you need to ask them to do hard things. you need to give them some cover, as they could to fix it. it's all flawed to each committee gets to take credit for fixing it. i think swing for the fences in the process is important thing. it's not what comes out of the and probably but there's a place for it. >> well, maybe i'm too much of a creature of his former swamp,

and i apologize if my vision of swing for the fences is more of a bunt. but i actually thought that dave camp kind of swung for, if not the fences, you know, hit something that looks like a double. now, i was critical of the plan for as much as i praised some of the courage, because the way it was structured it actually started out revenue neutral and then lost its revenue neutrality after the first decade. that looked extremely clear to me, both myself and my colleague that the veteran budget to the analytics to support the claims i'm not saying it was perfect, but he kind of did what the cap folks did in his piece which is let's go to the code and take out all this crap that everybody agrees is distortionary. i very much would support a discussion like that, but camps

idea was dead the afternoon of the day he presented it and not because of the opposing party but because of his own party. so while i appreciate your suggestion come and to think that we should start a dialogue as i suggested come it takes a long runway that swings for the fences. i think that it's not really helpful to just have that discussion with not having the political discussion, how do we get from here to there so we can have some kind of reasonable audience which they don't know, even within their own parties. >> just add one comment. i am not as responsible for the a4 treasure work as doug says. i left during the process. that was by the most politically naïve actions is ever done. treasury was turned over with almost no guidance from president to the obesity -- nothing he said was don't touch

deduction. retrospect, maybe a little political naïve may help. >> i'm frank, george mason university. i would like to get to the personal income tax because that seems to be the critical barrier. it appears that just as the corporate taxes and extreme tax in terms of other countries our personal income tax, maybe the same thing. but what i haven't seen done is an analysis of where the income of the highest tax brackets goes. the administration seems to talk in moral terms, it's not fair, you should pay their fair share of taxes. but if you look at the high income of high earners, it has

been established that a lot of it goes to expenses, imports, and, of course, a major portion to investments, much of which may be trading income rather than wealth building investments in plant in labor and so on. so i'm wondering if we don't need an in depth, accurate surveying of where the money goes as you go up the tax bracket? >> well, that's a really interesting question. i would first of all refer you, well, you may know about the service consumer finances aspires to be this or that you are describing. so the federal reserve every, is it two or three years? i think it's every three years, it's every three years, feels the survey which is intend to give you a very granular look at the uses of particularly income at the top of the scale.

but i can and that to you. was your question leads me in terms of this conversation is a broader macro economic observation that i'm talking about and writing a lot about on my blog, which is it does seem like we are a world awash in savings and deferred earnings in the context of our conversation, i watch in savings, a wash and lovable funds. and yet awash in weak demand. and figured out and some of doug's comments about smoothing the road between investment income and investment possibilities i thought were resonant. so figuring out how to connect those two disparate facts of life right now, a lot of low-level funds, investment levels of the kind of love to

me, a lot of investment needs whether it's public or private is certainly in the public space in terms of public infrastructure and very weak labor demand. that's a niche that should happen and to extend the tax code should facilitate that that's a great i think expression protection form, taken on the corporate side but on the personal side as well. >> jared is just wrong. and part of it is just strategy, rydquist he should not design a tax reform for the problems of the moment. fuchsia design a tax reform to give a tax code that is doable and as the permanency and raises the ribbon over the long term. i thought your comments were a great lesson in tax policy because they act with my views, number one. you want to tax people based on what they consume. is imports? whatever. i don't know the facts to the question but tax them on the consumption. don't try to tax financial transaction. that get you into trouble. it the financial peace out.

the money is too easy to move. it's incredibly expensive but it's never done effective and it's getting harder in a globalized world, and focus on real things, things that i could improve the productive capacity of the economy. though should be building blocks and the principle since. >> that seems extremely or false coal to the comment i'm just wrong. a lot of what you just said is -- i was trying to say in the sense where we might disagree is whether our investment needs, productivity enhancing destinies greatest? we may differ on this i think there's some real elasticity to tap in terms of investment and n public infrastructure. i'm not the only one who thinks that. larry summers is very articulate on the point. >> that's not tax reform. that's a spending policy. tax reform is hard enough.

>> i disagree. >> tax reform is hard enough. if you turn it into macroeconomic stabilization, long-term supply-side investment on the public sector, welfare policy, you have made too hard. >> know, my point, you're missing my point. my point is there are trillions of dollars lock up overseas, for example, very much as a function of the tax code. they should be unleashed to tax reform. by the way just be very concrete about this and you may not like the president's plans that as a transition to the international taxation, including this minimum tax i mentioned, there's 150 billion of one time savings that is plowed right into infrastructure investment. very concretely there's a plan on the table to do just that. you may not love it but it does link text form to these ideas. >> i want to make one comment. i thought this was a very, very interesting question is usually when you look at taxation of high income people, we think about education and incentives. how does it affect to work to

save contest and so forth. this is a question of what happens if i income people get more money, what do they do with the money? i think we probably don't look at that kind of question very closely, and as the income distribution gets an equal, are people getting more to charity? are they spending it on yachts? it's kind of interesting question for examining how progressive we want the tax system to be spent as i said, my view is taxing the income people. we often other economic lies in designing attacks. it's very important. >> let me get to more questions. in the back. >> on joe kennedy. i consult with information technology and innovation foundation. and i actually have two quick questions. one is how much of the burden of

the corporate tax is borne by labor? and the second -- >> what? >> i think every sort of agrees that if you get corporate tax reform reform and also individual reform it will have a big, positive effect on the economy here and get in traditional scorekeeping we don't count any of that. and so my second question is, how much of that should we count? is at the camp proposal got a score from the joint tax that had significant positive effects, dynamic effects, and should we say that none of that counts, or some portion of accounts, or what? >> those are great questions. before i turn it over to the panelists, on the first question, there's probably not an agreement on this panel. we say labor bears 20%, capital bears generally 20% and corporate equity, 60%.

the reasons for that are described in a paper on our website and that we came to that conclusion. so you can go to the tax policy center website, there's a paper. my colleagues might a totally different views. views. >> i'll just see you and raise you in terms of links. i recently investigated this question in a blog on my site and i linked as many different analyses of this as i could find. the average is in the 20-25% range in terms of labors bearing the burden, but there are other measures as well. >> i think it's clear there's no consensus on the imac the other end of the spectrum. i think a majority is being born by labor. we see these companies lose national competition. we lose the best jobs, the best fringe benefits and that's the labor laws. there's no doubt about it.

>> cbo puts it at 70-30. >> they actually don't are there was a model that did that but actually save 25. >> thereby displaying the uncertainty about this. but i think it's a real concern. >> on dynamic scores, i mean, first of all, and doug and eric should correct me if i mistake this, but it's an important to can discern what cbo does and what everybody else does everything the fact that cbo does incorporate behavioral elasticities in their estimates, but doesn't allow for dynamic supply-side effects in economic terms such that you'd count on getting a bunch of revenue back from growth effects from the tax reform. it's the right way to go in my

view, and i'm quite strongly take that position. it's not true that, so just to clarify, it's not true that there is no dynamic in cbo scoring because there are behavioral affects registered in the score. but they don't do is allow for the feedback effects that end up making predictions about gdp growth because of your tax changes. there's nothing wrong with other folks running around and doing that. i know j.c. -- jcp development t with kant and paul ryan very much enjoys exercise and expect to see a lot more of that from him. but when i see the magnitude of the dynamic effects there, it looks very much to me like extremely exaggerated impacts in order to make the numbers work. you can't get down to 25%, be revenue neutral and make just a

standing assumptions in my the about the dynamic effects of your package. and that's a very dangerous way to go if you're concerned about fiscal rectitude down the road. >> .com your experience as the cbo director. >> correct the record slightly. i was the budget office, and instead i supervise the dynamics of the president's budget proposal to jared's characterization is right. cbo holds the size of economy fixed. the whole idea of putting in growth effects is the line of the becomes dynamic scoring. i am a proponent of this because i believe we should indicate the policymakers, everything is different about the world before and after the policy, contemplating enacting. you have to get them before and after and if it includes more economic growth or less economic

growth, more tax revenue or less tax revenue, that's information that is valuable to them and important to be in there. there is no reason not to put it in. how you put it in is very important because this is called scoring, and schooling is different than forecasting. it's different than modeling. it's scoring. and when you go into the budget world you've entered a cold. escort gold is an important one. it says we're going to treat every proposal the same. and so scoring is operate at some level that you do the same for everybody. here's the best analogy to football games you get 6.4 touchdown. i don't know what. you get one point if you take the extra point. you get to if you run it or throw. i don't know why. but the fact that those arbitrary scores are the same for both teams, across all games played, and overtime allies you to compare policy proposals in

the same way. you always do the score the same. you do macro analysis be exactly the same way and you get more information into the process that's good and you will treat all proposals fairly, and that's essential. >> i think we have time for one more question. >> my names mary, and i am an independent observer. now, my question is, it doesn't mention here the gross historic proportions income inequality right now we have. what you think about a negative income tax? especially for the dumb better unemployed or underemployed, part-time employees. i was actually at the debate of the mayoral candidates and there

was one gentleman saying, well, i only earned 5000 this year. now, you know, if the minimum would've been standard deduction an exception is about 10,000 for 2013. i wouldn't that young man not be able to claim the government that refund? the other question i have, and that's -- this site has been around a long time, lease 100 years. at the other question i have is the gdp is about, what, 17 trillion? the budget is about 14 trillion. now, what is the proportion of tercel income taxes that go into -- and corporate taxes. so, you know, at 14 joining for the budget and 17 that we are producing -- >> weekend -- >> what does the government get, you know, the other question was

minus 60% on finance. >> i'll talk about that but doug, do you want to go first? >> let me address the first question. we can refer you to places to get statistics. >> i think you may been thinking of a debt as a share of gdp. the debt, action against the debt held by the public is around 10 trillion right now. so anyway, but at any rate, negative income tax. you're right, eric enough to get all the numbers you seek. i think that that, for the center on budget where i work, we think a lot about anti-poverty policy. and one thing i've observed, you can't miss it if you hang around in this down and think about poverty policy is that the thrust for the last 30 years really has been towards work for

able bodied working age households, work is a path out of poverty. and in that spirit things like the earned income tax credit, the refundable child tax credit, what i called earlier the refundable scope i would add minimum wage but we would argue about that come in the tax code those kinds of refundable scum certainly function like a negative income tax but they are not for everybody. air conditioned on work and i'm okay with that. >> on that note of agreement we should quit. >> okay. i think we have, by 1:00 we are done. with one minute so did you want a very quick one? [inaudible] >> a long one. spin i'm a cpa with a small cpa firm and i think i have an

understand of what individuals go through. just one quick comment. i think tax reform might be a good idea, but people are resistant because you're going to have a major reform at the next or something else. is just like i don't care if i pay $4 a gallon for gas i don't want to pay $6.1 week and $2.50 the next week. the other thing i want to say is that i think everything should be open to taxation. not just consumption. i don't see why a person like mitt romney can get a billion dollars of net worth and not pay tax because it's kept inside his hedge fund. i see nothing wrong -- everybody hates taxes but we have to come up with revenues. why not a net worth tax? you could set the limit $50 million, 1% over $50 million for someone like -- >> i'm going to cut you off the fish ask about network, quick

response? >> wealth taxes been unpopular, probably the most unpopular taxes in the united states so i'm not sure that's a row to actually getting tax reform but i understand your point. i do want to say one word about the tax could change it all the time. the durability of the reform is important. it's one of the sad things about a six or visit unwound relatively quickly. a key part of it is you can do this and independent of what wht jared has talked with potential long-term budget output. unless you fix the spending side to match the revenue side, you will have these deficits. we have deficits in the late '80s, early '90s. that leads to pressure for rent in which lead you to open up the tax code and the minute you open it up the integrity of any reform starts to be unwound. so the key to durability of tax reform is willingness to get the spending side in order as well spent i think you make a very good point, and i like your idea

about a net worth or a wealth tax. i will note, and i think the way you key that is exactly right, on its face consumption tax of course is regressive in the sense that those with low income consumers more of their incomes than the wealthy. duck did mention a progressive consumption tax and that could be done. so take your point and i like your point but i will just leave or restored or at least where i started, which was ask yourself, why do we have such come in my view, such a tiny and ineffective estate tax? why don't have an inherent tax? wonder whether net worth tax? the answer is because the folks were defending the status quo have more income than ever. we have a toxic domination of wealth concentration of the top of the scale and money and politics play a greater role than it ever has before. so why i like to do while i like

the id of your thinking, because into the deep political strengths better start of the conversation. >> if money would be that important mitt romney would have been the winner spent i'm not saying he gets elected president. i'm saying it has huge policy implications spent on that note that there's been on this and agreement on the previous question, i think the two panelists for showing there can be some areas of agreement and for the very high level discussion. >> later, the head for the senate disease control, dr. tom frieden and doctor, at the world health organization updated congress on the spread of people in west africa. a new cdc report says 1.4 million people in liberia and sierra leone could become infected by the end of january. watch that live at noon eastern here on c-span2.

>> you are just a few of the comments we have received from our viewers. >> i recently discovered c-span3 that he didn't even know i had, and i love it. can't describe in a few words. right up my alley. thanks. >> c-span tries to be nonbiased. they tried to be useful for democrats, republicans and independent life but really there's no democracy. the voices are limited. i wish you could expand the voices to more third party people because the democrats and republicans are basically the same. and also if you could limit the amount of discussions you have with republicans and democrats elected officials and use more independent voices for discussions, thank you. >> please, whatever you do, do

not take c-span3 off. it's a very educational shell. i listen to mostly everyday. -- educational show. i find out more and more about my government. and also books and history. please, do not take it off the air. >> why is c-span favoring republicans over democrats? why does c-span let republicans calling and demonized and say anything against the president and they're not cut off? if the democrats is something that republicans they are cut off. c-span is not fair. >> let us know what you think about the progress you're watching. calls, e-mail us or send us a tweet at c-span hashtag comments. join a c-span conversation, like

us on facebook, follow us on twitter. >> at the annual conference of britain's labour party, party leader ed miliband discussed his support for airstrikes against isis answer your. in scotland referendum during the part of the -- joining. this is held in manchester, england. ed miliband's remarks are an hour and 10 minutes. ♪ ♪ ♪ >> ladies and gentlemen, please welcome the leader of the labour party, ed miliband. [applause]

♪ ♪ ♪ ♪ >> well, friends, thank a summit for the incredibly kind welcome. i want to start by talking about somebody who's from salford, just down the road from here and that's alan henning, a british hostage taken by isil. his wife, hostage taken by isil.

his wife, barbara henning, made an incredibly moving appeal for his release just over the weekend. you know, alan henning is simply an aid worker trying to make life better for victims of conflict. i think it should tell us all we need to know about isil and their murderous ways that they take a decent british man like alan henning hostage. and it's not just british people that they are targeting; it is people of all nationalities and all religions. that's why we supported a coalition, not simply based on military action but a coalition based on humanitarian, political and diplomatic action to counter the threat of isil. now this week, the president of the united states and the british prime minister are both at the united nations. we support the overnight action against isil, what needs to

happen now is that the un needs to play its part. a un security council resolution to win the international support to counter that threat of isil. [applause] friends, this country will never turn our back on the world and will never turn our back on the principles of internationalism. [applause] and those values are reflected not just in our country but in this party, in this hall and in this great city of manchester [applause] friends, it is great to be with

you in manchester. a fantastic city. a city with a great labour council leading the way. and a city that after this year's local elections, is not just a tory-free zone but a liberal democrat free zone as well. [applause] now manchester has special memories for me because it was four years ago that i was elected your leader, here in manchester. four years on i feel wiser. i feel older. i feel much older, actually. [laughter] but hang on a minute, some of you look quite a lot older as well. at least i've got an excuse. but i am prouder than ever to be the leader of your party and i thank you for your support.

[applause] now we meet here in serious times, not just for your world but for our country too. our country nearly broke up. a country that nearly splits apart is not a country in good health. i want to start by thanking all of labour's team scotland for the part they played in keeping our country together. [applause] let us thank them all. gordon brown, alistair darling, margaret curran, douglas alexander, jim murphy, anas sarwar, johann lamont.

[applause] let us thank them all ladies and gentlemen because they helped save our country. [applause] and i want to say to the people of scotland directly: this labour party will show you over the coming years you made the right choice. because we are better together. [applause] now here's the thing. all of us, all political leaders, all of us in this hall, have a responsibility to try and explain why 45% of people voted yes. 45% of people wanted to break up our country. and we've got to explain why the feeling we saw in scotland is not just in scotland but is reflected across the country and

my story starts six days from the end of the referendum campaign. i was on my way to a public meeting. i was late as politicians tend to be. and just outside the meeting i met a woman and i was supposed to be going into the meeting but i wanted to stop and ask her how she was voting. i did that to everybody on the street. one vote at a time. i said to her how are you voting? she said i haven't decided yet. turned out her name was josephine. she worked as a cleaner in the building. i asked her what the company was like that she worked for. she said the company was decent but the wages were rubbish. she hadn't decided because life was so incredibly tough for her. she didn't want to leave but she thought it might be the best thing to do. now, i don't know how josephine voted in the referendum, but i do know the question she was asking, is anyone going to make life better for me and my

family? and here's the thing. it isn't just josephine's question. it's the question people are asking right across britain. is anyone going to build a better life for the working people of our country? that wasn't just the referendum question. that is the general election question. [applause] i am not talking about the powerful and the privileged. those who do well whatever the weather. i'm talking about families like yours, who are treading water, working harder and harder just to stay afloat. for labour, this election is about you. you've made the sacrifices. you have taken home lower wages year after year. you have paid higher taxes. you have seen your energy bills rise and your nhs decline.

you know this country doesn't work for you. my answer is that we can build a better future for you and your family and this speech is about labour's plan to do it. labour's plan for britain's future. [applause] so what do we need to have that plan for the future? we've got to understand what people are saying to us right across the united kingdom. see, i think across our country there is a silent majority who wanted our country to endure but are telling us that things must change and they come from every walk of life. like a young woman called xiomara who works in a pub near where i live. she lives at the opposite end of the country from josephine. she's separated by at least a generation. but they share a common

experience. xiomara couldn't afford to go to college. so she got a job in the pub kitchen nearby, washing dishes. she's worked incredibly hard and she's worked her way up to be one of the chefs. but like for josephine, life by xiomara is incredibly tough. and by the way, she thinks politics is rubbish. and let's not pretend we don't hear that a lot on the doorstep. what does she see in politics? she sees drift. she doesn't think we can solve her problems, now we've got to prove her wrong. and it's not just that people like xiomara and josephine are struggling with the problems of today and millions of other people. i think there's something almost even more important about our country. people have lost faith in the future. you know, the other day i was in the park. i was actually trying to work on my speech, believe it or not, and i wasn't getting anywhere,

so i went to the park and there were two young women who were in the park and they seemed excited to see me and they came over. and -- [laughter] it's not that funny. one of them actually said so it is true, you do meet famous people in this part. and the other one said yeah, it is. and then the first one said, no offense, we were hoping for benedict cumberbatch. [laughter] but anyway, one of them said something which really stuck with me. she said this, she said, my generation is falling into a black hole. and she said about her parents' generation, they've had it so good and now there's nothing left for us. she wasn't just speaking for herself, she was speaking for millions of people across our country. millions of people who have lost faith in the future. like gareth, who is high up at a software company. he's got a five year old

daughter, he's earning a decent wage, he can't afford to buy a home for himself and for his family, he's priced out by the richest. he thinks that unless you're one of the privileged few in britain the country is not going to work for you and your kids are going to have a worse life than you. and so many people, friends, across our country feel this way. they feel the country doesn't work for them. and they've lost that faith in the future. now our task is to restore people's faith in the future. not by breaking up our country. but by breaking with the old way of doing things. by breaking with the past. i'm not talking about a different policy or a different program. i'm talking about something much bigger. i'm talking about a different idea, a different ethic for the way our country succeeds. you see, for all the sound and fury in england, scotland,

wales, across the united kingdom, what people are actually saying to us is this country doesn't care about me. our politics doesn't listen. our economy doesn't work and they're not wrong, they're right and this labour party is going to put it right. [applause] but friends, to do that we have to go back to the very foundations of who we are and how we run things. we just can't carry on with the belief that a country can succeed as a country with a tiny minority at the top doing well. prosperity in one part of britain, amongst a small elite. a circle that is closed to most, blind to the concerns of people. sending the message to everyone but a few: you're on your own. see, think about it for a

minute. in our economy, it's working people who are made to bear the burden of anxiety, precariousness and insecurity. they've been told, you're on your own. so many young people who don't have the privileges, think their life is going to be worse than their parents. they've been told, you're on your own. so many small businesses are struggling against forces more powerful than themselves. they've been told, you're on your own. and the most vulnerable have been thrown on the scrapheap, cast aside, not listened to even when they have a case. they've been told, you're on your own. and to cap it all, in our politics, it's a few who have the access while everyone else is locked out. they've been told, you're on your own. no wonder people have lost faith in the future. that's why so many people voted to break up our country.

is it any wonder? the deck is stacked. the game is rigged in favor of those who have all the power. friends, in eight months' time, we're going to call time on this way of running the country [applause] because you're on your own doesn't work for you, it doesn't work for your family, it doesn't work for britain. [applause] can we build a different future for our country? of course we can. but with a different idea for how we succeed. an idea that in the end won this referendum. an idea i love because it says so much about who we are and who we have it in ourselves to become.

an idea rooted in this party's character and our country's history. an idea that built our greatest institutions and got us through our darkest moments. an idea that is just one simple word. together. together. together we can restore faith in the future. together we can build a better future for the working people of britain. together we can rebuild britain. friends, together we can. [applause] together says it is not just the powerful few at the top whose voices should be heard, it's the voice of everyone. together says that it is not just a few wealthy people who create the wealth of our country. it's every working person.

together says that we just can't succeed as a country with the talents of a few, we've got to use the talents of all. together says that we can't have some people playing under different rules, everybody's got to play under the same rules. and together says that we have a duty to look after each other when times are hard. together. the way we restore faith in the future. together, a different idea for britain. [applause] now you might be thinking this sounds like a pretty big undertaking, changing the way our country is run, a totally different idea, that's quite a big task, is it really going to be possible? can we do it? i mean, it's the 21st century, is that going backwards? well it isn't. and the reason it isn't is because that idea is everywhere around us to see.

in every walk of life. the inspiration is everywhere of a different way of doing things. see, earlier on i mentioned gareth, who works at a software company, who's worried about his daughter and worried about the future. i didn't just meet him, i met his colleagues as well. and that software company, the thing that shines through about it for me is it is full of bright, savvy young people, full of great enthusiasm. but it isn't about the boss at the top. it isn't each individual on their own. go to every person at that company and they say the same thing. you need to use the talents of every single person. not just the software designers, but the customer service. not just the developers, but those who manage the accounts. and go to so many great businesses across our country and they'll the same thing to you, that is the ethic of the 21st century in business. we need great entrepreneurs. britain needs great entrepreneurs.