again, this is about working for the american people. we very much hope the president will join with the congress and all the states that are a part of the approval process and most importantly with the american people and approve this legislation as part of building an energy plan for this country. it is so important not only in terms of energy, jobs

economic security but energy security as a part of national security for our country. want to thank both senators -- senators on both sides of the aisle. this took a bipartisan effort. that that is what the people want, us working together to address important issues for our country. [applause] [inaudible conversations] >> i've got to go. there are a few more things to be voted on post-cloture, so we are close to the end of the cloture list. the department of homeland security will be next. [inaudible conversations] >> well, number one, we hope

they we will sign the bill. we will try to most likely attach it to other energy legislation that we we will continue to work on. sen. lisa murkowski has great ideas. there will be other opportunities. >> see it on the floor. [inaudible question] >> we have to give it to the desk. working to the process today. able to move it out of the senate with a good bipartisan vote. obviously we have made some changes. the house will take a look at what we have done and i am hopeful we we will be able to move a bill to the president quickly. then it is in his lap. >> we have already started talking to the house. we are having that discussion and we will see.

>> any thoughts on timing? >> very soon. we are in consultation with the house and want to make sure we are talking to them before the next step in terms of conference or whether they would confer with the bill. >> trying to get it out of the senate. >> and we have to finish up this afternoon. we had the nine democrats that indicated they would be with us on the bill. so we are pleased and moving forward. >> ready to go. finish it up. thank you. [inaudible conversations] [inaudible conversations] >> before the final vote on the keystone xl pipeline a

number of democratic senators spoke with reporters about the bill. [inaudible conversations] >> it will be you you, me. >> yes. >> okay. >> good afternoon, everybody i would like to thank my colleagues and the two people who did an amazingly great job from our side on managing the keystone pipeline bill. now, this afternoon the senate will pass a bill a bill that would force the approval of the keystone pipeline a bill that the president has rightly in our opinion said that he would veto. right out of the gate, 1st act of the new republican majority was to pass a special interest bill that is a giveaway to foreign oil

and steel companies and will do nothing to benefit the american people. republicans are calling this a jobs bill, but the fact is that the keystone would create only 35 permanent jobs. a a fried chicken franchise creates about as many jobs. they they are trying to say this is a win for the middle class. how can they argue that a bill that constructs a pipeline we will benefit america's middle class? well, they can't with a straight face. republicans are now over and

over again. those amendments don't do any good if republicans button-down. it is like playing a ballgame and not scoring any baskets. what is the. democrats want to the pipeline if it was going to be built to be built with american steel. republicans said no. we also wanted the oil that came through the pipeline to be used in the us for the benefit of americans. republicans said no and we wanted to protect us drinking water from oil spills coming from a canadian the canadian owned pipeline. again republicans said no.

and just today leader mcconnell twisted arms to prevent republicans from helping democrats reauthorize the land and water conservation fund, a program that has always had bipartisan support. it had 62 votes. time and time again republicans pledge their allegiance to foreign special interests over the american middle class. it is unfortunate that this bill we will pass but the debate has made it crystal clear whose side the parties are on. democrats fighting hard for the middle class republicans doing the bidding of foreign oil companies, foreign steel companies, and other special interests. >> thank you, senator. it is my pleasure to be here to stand with you and to thank our great leader. it is stunning when you look

at the very 1st bill right out of the box. it is about coming off of an election where we saw to big oil billionaires who were able to do in terms of the money that they put into the republican caucus. it is really quite stunning to see the difference. and from our side we see american communities and families taking all of the risk and not getting any real long-term rewards from this. we say okay if you are running through our country we get to keep the oil. they said no. if you're running it through our country it needs to be american steel and american workers. they said no. okay. at least protect property rights. they said no. how about the fact that if you are a canadian firm running a pipeline through america you should pay into the oil pipeline the oil

spill trust fund. they said no. when sen. peeters and i put forward an amendment. wait a minute. wait a minute. we have aging infrastructure, the largest bill of a pipeline in our country in and kalamazoo michigan, still being cleaned up over a billion dollars. we should make sure that pipeline safety is improved and enforced and we have standards. we are scared to death in michigan because we have a large pipeline by the same company working under the great lakes. we offered an amendment on pipeline safety, multiple amendments. they said no.

this is a good deal. foreign companies wanting to use us a big straw, but, but it is a bad deal for americans to say that this is not something that should reach the president's desk and if it does they we will be members who we will support the president's position. this is an important bill. maybe maybe we did break through an incredible ceiling this week when the majority of the united states senate finally said that climate change is not a hoax and when the majority of our colleagues showed that energy efficiency is actually a winning bipartisan issue. ninety-five votes, and a voice vote by my colleague senator collins, which shows you all along why do we hold things hope things are for two years under jobs and energy efficiency. it does not matter what source of energy people use around the globe making it

more efficient is a winning jobs strategy and we have created jobs on clean energy and energy efficiency and wish we would be spending time on those policies which are clear bipartisan winners to move forward. as it is now we still have legislation that will basically give this company a special pathway that us companies would not have. all we said all along is keep the state department in the game to be able to negotiate the rules by which they would be permitted. we are not going to exempt them from that process command that is what the vote this afternoon is, trying to exempt this foreign company. >> senator boxer. >> okay. first let me say that i agree with everything that

has been said and it has been said so well. i will just add a little bit of dimension. i will say something command you may question it but it is true. we have looked back since the beginning of time and have never ever found a bill that gave special favors to a private company. we have gone back and never found a bill in the senate that gave special exemptions and favors to a private company among let alone a foreign company. we we have never done what they do here for an american company and now we have done this special and special kiss to a foreign oil company.

why do we say that? just read the bill. it waves every right of the american people to have our environmental laws apply to this project. it project. it does not matter what happens. they are guaranteed permits. they are guaranteed that even if they don't follow the permits and there is a a horrible spill that they don't clean up the way they promised their permit does not get revoked. nothing that they do could allow a supplemental environmental impact statement. statement. so all of the laws that were passed in a bipartisan way, most of which signed by a republican president are waived for this private company. this bill is a disgrace a a disgrace and it is the 1st bill that they bring up.

and in and in closing i would say this, senator schumer and senator stamina we chart to make this a better bill and they turned us away with a couple of exceptions. we tried with more american jobs and they said no read this bill because it is quite simple. when i heard about the keystone bill i did not no exactly. i said, oh my gosh. this waves gosh. this waves every single law that is important to the american people. i think this is a scandalous bill myself. the fact fact that we tried to make it better for the middle class

and they walked away they we will have to be held accountable for it. this afternoon a couple of us are trying to hold this company accountable. so if they disobey their permits and don't live up to there permit and you will see what the vote we will be but i am so honored to be here with my colleagues. i think that we handle this debate very well. i want to say to the leaders and.out cantwell was the manager. i was there to help her when she needed me. essentially she really handle this magnificently. the bottom line is we tried to make a bill better. it did not go down well. we called him on it, it and i am proud of this democratic minority. we will be heard and we will

stand on principle. >> questions. >> looking ahead to next week with the homeland security appropriations bill being moved i democrats going to support this measure? >> let me say this. it seems our republican colleagues are willing to shut down the government despite the fact that we have such security needs here in this country. they seem to dislike the idea of supporting homeland security. they dislike dislike dreamers more than they dislike isis and it is just unbelievable. we believe that we ought to pass a clean homeland security bill protect our security, and they can debate immigration at another. the bottom line is we are not for showing down the

government, holding hostage our very security and difficult and treacherous times to debate an issue that should be debated at another time. >> republicans have indicated they are going to bring back the issue. of course never have indicated they support the pipeline. so president obama could do dealmaking and how to improve. >> i am not going to speculate on what the president has done. he has said he would veto this bill. it is clear that their are not the votes to override in the house or the senate. we will see what happens after that. >> an important question would be why this is so important why this bill that is as senator -- yes 35 jobs a canadian company a special deal for canadian company why is this more

important than investing in the roads and bridges pipeline bridges pipeline safety water and sewer projects of our country? and i would double back and say as we go into next week it is going to be extremely clear that from our perspective with terror threats all around us we we will not support the republicans attempt or willingness to shut down homeland security just for political points. >> what do you think of the plan proposed? >> i can speak for my health when i think for most democrats. the idea of removing the supreme court from changing the rules so that a mere majority votes for the supreme court is something

we never supported, even when they were filibustering judges filibustering nominees, we always felt the supreme court should be fixed. i think that idea was very strong. >> we will see how they do it. that is what senator alexander has told me this far. that will never pass. >> democrats held together pretty well. >> we did. >> do you think it is a sustainable model? >> mitch mcconnell started out with an open process. as soon as he get frustrated he tried to shut it down 1st by doing seven votes in a row to table bills late at night, not letting even venerated senators like leahy or jack lee have a minute and then he filed cloture prematurely. democrats stuck together and said, we're not going to let whatever our views are on the specific amendments or the pipeline bill, we we

will protect our colleagues rights to offer amendments. we are we are proud and pleased with the way our caucus held together during this pipeline vote. i think it argues well for the future. senator mcconnell is learning especially with the carcass is divided as his it is hard to move forward. >> on the pipeline, both of you but there is still a debate gap between what we consume and produce. isn't it better to come from canada and some of the other >> if we are going to export all of the oil what is the.? all right. you are saying we need to import oil. let's at least use this oil here. they said no. that made it crystal clear that they were for special interests the pipeline is in the oil companies which are not american and don't

give a hoot about the american consumer. >> i would add to that that china will pay more than the crisis in the united states. they want to use us, go to the country no guarantees on anything in terms of america. they ship it to china. china. that is what they want to do and we have said no. the 2nd thing i think think is important to emphasize the reason prices are down a couple of reasons that we, i take pride in related to crisis being done. one is back in 2000 560% of all oil was coming from overseas. by

next year we anticipate it we will be 25%. 25 percent. doing more domestic production and have more energy efficient vehicles that are using less fuel. and so because of the kind of policies we have been doing to focus on americans and strengthening our middle-class opportunities we are seeing prices come down and certainly don't want to go in the opposite direction. >> the pipeline was much more of an issue when it started several years ago. now that america is producing more and more oil and it is clear that the oil from the pipeline is by and large being exported it has become less important. i still had a question. >> the republicans, a top priority. do they get any credit? >> well, we had to make sure that amendments were allowed after a certain. i think their were 15 of them and then they moved cloture to shut things down. so look the bottom line is simple. and they blocked every single amendment.

so what good is it? is going of points by blocking every single amendment. you know, i think that it was democrats who had to make it clear we wanted to preserve the ability to offer amendments. >> the question is what happens on bill number two and three and four and five. >> the next one the prior.on it. dhs appropriations is not get out with any democratic votes? >> again, to us the security of america dhs preserves the security. we're not going to play games on amendments immigration where security is at stake. we have a pretty clear and unified stand. pass the dhs bill.

the republicans should have learned their lesson when they attempt to shut down the government because the small group of them feel so strongly that they are right and everyone else is wrong. it is a loser substantively because the security is at stake and the loser politically because americans don't like that kind of hostagetaking. >> thank you. >> the senate judiciary committee has finished two days of confirmation

hearings for president obama's nominee to be the next attorney general. if you missed any of today's hearing we we will have it for you in its entirety tonight at 8:00 o'clock eastern on our companion network. also the senate armed services committee held another hearing on us national security as former secretary of state henry kissinger entered the committee hearing on today it was met by protesters from the group code pink. here is what happened followed by a response from community chair john mccain. [inaudible conversations] [inaudible conversations] [inaudible conversations]

[inaudible conversations] >> order. [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] >> in the name of the people of chile, vietnam -- >> you know what?

>> in the name of the people of laos. [inaudible conversations] >> i would like to say to my colleagues and to our distinguished witnesses this morning i i have been a member of this committee for many years and i have never seen anything as disgraceful and outrageous and despicable as the last illustration that just a place. you know, you are going to have to shut up or i will have you arrested. if we if we can't get the capitol hill police in here immediately -- get out of here, you lowlife scum. [applause] so henry, i hope you we will

-- doctor kissinger i hope you we will come on behalf of all of the members of this committee on both sides of the aisle, in fact on behalf of all of my colleagues i would i would like to apologize for allowing such disgraceful behavior toward a a man who served his country with the greatest distinction. i apologize profusely. >> following the protests senator mccain's office issued this statement. the incident the incident at today's senate armed services committee hearing

again, that statement from senator mccain's office. the hearing will air in its entirety at 8:00 o'clock eastern tonight here on c-span2. >> keep track of the republican-led congress and follow its new members to its 1st session. >> next keynote remarks on broadband technology from fcc commissioner jessica rose morsel at this year's year's internet policy conference. we will here from congressional internet caucus chair of virginia. posted by the internet education foundation. >> one. >> second with our next speaker. take our seats and get ready

thanks, everybody. thanks. throughout the day our board of directors representatives are providing the introductions. our board of directors, there is a packet in your packet. they keep us balanced and they are committed to the mission of hosting these balanced debates where everyone is considered a stakeholder, and without them we would not be able to have this program. i would like to introduce my board member from comcast universal. good morning. a board member at the internet education foundation and i just want to give a nod. keeping this together on the eve of a snow day and

starting the morning out so well. thank you. so i am i am privileged to introduce the next keynote speaker fcc commissioner jessica rose and worst. many of you know her from her time on the senate communications counsel senate commerce committee as well as her tenure most recently for serving as legal advisor for commissioner cobb. people come to commissioner positions from a variety of ways and i just want to say how heartening it is to see someone who was such a leading figure as an expert come back to lead it. i would like to recognize that. jessica has also been a leader within the commission and the government of freeing up more spectrum for innovation, new services to access. most recently she has been championing identifying

unlicensed spectrum, in particular a hundred megahertz of spectrum the most significant movement on unlicensed spectrum in a decade. the fact that she has been such a leader is no surprise during her confirmation hearing senator rockefeller commented that she is calm brilliant and never loses an argument. as are three important qualities. on a personal note, i i would like to thank the commissioner for her very constructive calm, balanced orientation toward a lot of international issues. she has been a wonderful partner and outline. with that it is my pleasure to introduce commissioner rose morsel. [applause]

>> good morning. washington really rolled out the white carpet today. glad to see that you are all here and willing to face a slightly fierce winter storm in our nation's capitol. thank you to ten and thank you to state of the net for what you do and to the internet education foundation for holding this forum to talk about important internet policy issues. now, up front i think i need a disclaimer. as a commissioner at the federal communications commission speaking at the state of the net conference i am going to defy some expectations today. i am not going to talk about network neutrality. [applause] [laughter] i support network neutrality

but no matter where you stand on that issue i suspect you will agree with me that that issue does not lack for attention. i want to upend expectations and talk about something else something that warrants more attention and deserves more support. i want to talk about wi-fi. we need more wi-fi. when he more wi-fi because it is an essential on-ramp for internet connectivity. we need more wi-fi because unlicensed spectrum is our best bet for wireless innovation and we need more wi-fi because in the world of constant connections it is responsible for billions of dollars of economic activity and growth but i

am getting ahead of myself. before talking before talking about how we can have more wi-fi in more places i want to tell you a story. i want to dust off a story from the fcc archives and tell you about the time the agency rewrote the book on spectrum policy and lay the groundwork for modern wi-fi. so roll back three decades. and to help you out, here is some color. back to the future was on the big screen and swatch watches with a smart watches on r wrist. commodore meant computing and compact discs were emerging as the be-all end-all future of music. it was a long time ago. but three decades ago just like today, the fcc was tasked with managing the

airwaves. so the agency had lost licenses for radio television, satellite services and a bunch of other things but not all of our airways were occupied. a handful of obviously underused frequency. the airwaves that have been designated for industrial scientific and medical uses. the services never quite did in part because under fcc rules they had to contend with interference from some widely used devices that were going really popular three decades ago, microwave ovens. in fact so little is happening these airwaves were known as garbage bands. the conventional wisdom was that they were just junk.

they were they were scrapped spectrum with the demand for wireless services but this is where the story takes an interesting turn. the fcc decided to think differently. we decided we could do more than just dismiss these bands is junk, so we decided to abandon the traditional practice of providing licenses to single operators to control and specific bands for specific purposes. to do this we decided that we needed to ask experts for some big bold command creative ideas. and once we got started the questions multiply really fast. what if cftc decided that they did not have to dictate what technologies used these underused frequencies.

what if instead the agency just set some basic technical parameters and what if we gave the public access to these airwaves? that would mean instead of thinking about spectrum like a license or a leaf on a property we would think about it like a highway where if you obey the basic rules of the road you can do things and go places. so when fcc circled this was some edgy stuff. it was a move away from command-and-control spectrum policy. it was a different way to think about interference and optimizing our airways. and to there credit my predecessors of the fcc did not only asked questions

they took action. as a result three decades ago the fcc designated its 1st significant swaths of unlicensed spectrum in the so-called garbage band. and you are probably seeing this coming, but this is the spectrum were wi-fi was born in time with the development of the 802 .-dot 11 standard we turned this wireless junk into gold because today our lives are not only dependent on wireless connectivity they are deeply dependent on unlicensed spectrum and wi-fi is an enormous part of that. how we get online, more more than half of us have used public wi-fi and more than 60 percent of us rely on wi-fi at home. wi-fi is how our carriers manage their networks. in fact, today nearly one

half of all wireless data connections are offloaded onto unlicensed spectrum so it may not be intuitive, but unlicensed spectrum helped manage the flow of traffic unlicensed airwaves. and how we foster innovation is because the load barriers to entry for unlicensed airwaves makes them perfect sandboxes for experimentation. this is where we tinker. it is where we can explore new ideas for internet-enabled future at low cost. wi-fi is also a boon to the economy the economic impact of unlicensed spectrum has been estimated at more than $140 billion annually and that is only going to grow. i think this is good stuff.

i think we need to keep it coming. we need to make wi-fi a priority in spectrum policy. it needs to move from the back bench to policy prime time. so here are three ideas to make that happen. first let's commit to finding more spectrum for wi-fi and unlicensed activity. as rebecca mentioned, last year year the fcc freed up 100 megahertz of spectrum and a five given the five ghz band for unlicensed use. so far so good. but next year the fcc has an opportunity to bring more unlicensed spectrum to market through this the smart use of guard band in the 600 megahertz band. we need to follow through and just do it. second let's take a fresh look at how congress accounts for how airwaves.

traditionally, the legislative process has overlook the value of unlicensed spectrum and favored licensed spectrum. that is not not because of some rancorous partisan divide and it is not because of some on unfair to have unsavory battle between big industry. it is it is because when the nonpartisan staff at the congressional budget office does their job they assign value to spectrum when it is licensed and sold at auction so bills that directly fcc to sell licensed spectrum at auction get high grades while legislation that creates more spectrum for wi-fi gets low marks. i think this accounting method is updated because it fails to take into account the more than $140 billion in economic activity unlicensed spectrum created each year. that economic activity can

grow if we find a knew way to put wi-fi on the books. so. so i think it is time to develop a multiplier that accounts for the billions of dollars of activity that unlicensed spectrum can generate in the economy. making small accounting changes could be the ticket to bigger wi-fi opportunities in the future. let's make clear that we we will not tolerate malicious or willful interference with wi-fi. that is actually already the law under the communications act. but last year a bunch of hotels banded together and filed a petition with the fcc. they asked the agency to bless their ability to block hotel guests from using their own wi-fi connections under the guise of network security concerns.

there are their are other ways to address legitimate network security concerns, but this is a bad idea. we have all been hotel guests. i i am sure their are some road warriors in this room. so you know, wi-fi is the difference between working in the comfort and privacy of your room and being relegated to that windowless business center. it is the difference between streaming the content of your choosing and being stuck with the hotels on demand selection. it is the difference between seamlessly getting your work done at a conference and being saddled with special fees and charges just to connect. in other words, wi-fi gives us choices. those choices matter well beyond hotel rooms. we live in a wireless world

built on constant connectivity having more ways to connect in more places makes us stronger, and will help grow our economy. as the internet grows less visible precisely because it becomes a part of everything that we do. so let's not let this petition languor or create any uncertainty, and i hope my colleagues at the fcc will work with me to dismiss it without delay. so there you have it. i think the state of the net those a lot to the state of wireless connectivity, and connectivity, and i think the future of wireless connectivity will be stronger if we make more room for more wi-fi. thank you. [applause]

[inaudible conversations] >> a few minutes behind. the chairman is coming in right now. we will be starting next. >> it is amazing. >> and our next speaker. bear with me me for one quick 2nd. thanks. [inaudible conversations]

[inaudible conversations] [inaudible conversations] >> good morning, everyone. i am a new member on the internet education foundation. it is my pleasure to introduce our next speaker for our next conversation. we have joining with us now the house judiciary chairman and chairman of the internet caucus joined by fred person

[applause] >> thank you very much. this is something that i enjoy doing every year. we have some great industry leaders come to talk to us. we had travis from over and that does not seem knew anymore at all just two years ago. last year we had drop box. now we have another great industry to talk about and a great company and a great leader. fred is the cofounder and president of coin base and he comes to that business from the financial services industry where he was a foreign-exchange trader he

managed and traded the electronic platform. also analyzed also analyzed portfolios and black rock and working nano structure research. he he holds a bachelor of science in computer science with honors and distinction from duke university and is taking that experience in the financial services world and translating it into the tax world -- tech world in a whole new form of currency. just absolutely delighted that you are here. here. tell us a little bit more about yourself and welcome. >> to be clear, i see myself as the guy because i am a technologist first. so as the interim said i am one of two guys that runs coin base, the largest

that.company in the world of the moment. we we see this is a very important innovation. frankly, one that that is a little bit challenging to understand. it is probably most analogous to the internet, a very very low-level very low-level protocol innovation that has a lot of broad implications. which is why i am out here to try to get your minds spinning around. >> the world's leading bit coin company. tell them tell them what you would want them to tell somebody. he does -- >> yeah. >> what would they tell their friend? >> the simple way to think about coin base is kind of like paypal. bit coin is the underlayer rather than dollars or euros

i think more broadly the way to think about bit coin is bit coin is kind of doing for transactions with the internet did for information it is it is making everything in order of magnitude cheaper, faster and arguably most importantly making everything up so that everyone can access it anybody can go. that is kind of why we saw this massive wave of innovation. we basically see bit coin as the fundamental infrastructure that we will do that for transactions. >> you got some pretty interesting believers. you announced the close of your latest round of capitol acquisition for your company which included some pretty impressive financial institutions including the

new york stock exchange usaa bank. what do these institutions see as the promise of coin base and bit coin in general? >> they are looking at it in that same way. when the internet came along you have a lot of companies that ended up being disrupted or had their businesses drastically change the with the internet allowed. the example would be the new york times in 1994. there probably would have been served well if they had dipped their toes in the water earlier rather than like a lot of companies scrambling and saying what is our internet strategy. i think what you are seeing here is more forward thinking people in financial services taking a look at this seeing a similar moving have played out before and really thinking how we get some institutional knowledge because we no it we will change the business somehow. we might not know exactly how right now but we would

be well served to have an understanding. >> yesterday you announced the launch of the 1st us-based bit coin exchange. i think you are up and operating in 23 states 23 states already. can you tell us a bit more? have a transparent and us regulated exchange like that >> i think it is important. a lot of personal context bit coin companies or exchanges have been largely operating outside the united states. a lot a lot of it is for regulatory scrutiny reasons to this.in time. we did launch the 1st us exchange with some capitol from the new york stock exchange. this is really important because it lays off groundwork and infrastructure for other great companies to be built. it's not a perfect analogy but you might view this is something like aol in the

early days were by allowing a reasonable exchange almost like aol allowed a bunch of people to die led to the internet and start to get involved. >> a lot of people i am a customer. >> glad to here it. >> i have a wallet with your company. a lot of people have heard of it but i've never used it. i would imagine that was one of the impediments to growth in the industry. talk about some of the challenges that this industry faces. >> sure. so part of it is simply a time thing. thinking about the internet it took many years for us to get from the 1st web browser and 9394 timeframe to a place now where we all depend on the internet for a lot of basic parts of our daily lives fast forwarding

23 years now. i think there is a a similar kind of technological innovation way that is happening, hopefully over a shorter amount of time where we are kind of in bit coin where the internet was. that is part of it. >> trying to figure out how it works for them. >> that's right. ebay did not exist. a lot of this just a time to create. part of it is regulatory. if you trying to start a business that's just one more hurdle that you need to cross. hopefully as people become better educated overtime those hurdles it lowered and lowered and lowered.

>> and how have your conversations been going on right here in washington? the heart of that bureaucracy that you have to deal with both here and in the states and internationally. >> to be honest, it is pretty varied, varied, and i think it is mostly because of the education level at this. people who understand it are extremely excited about it. there are times when people are less educated command that can be a little threatening media headlines. child porn or illegal filesharing where it seems scary but at the end of the day it really does much more good than harm. >> different countries and

different states are taking different approaches. some are viewing this as a a good thing. they want to promoted and be a part of the. some are concerned about it for a variety of reasons some want to treat it as currency, some want to treated as investment. is that is that good that we have that kind of competition of ideas making it even more difficult. >> it's good in the sense that you have some geography that typically states where they see the promise of the technology and are trying to be supportive of it. there is some bad potentially. i i think people are thinking about this almost a little bit too much. you get people trying to fit

old laws. a round peg square whole problem. money transmission lines at the state level. those are being applied conceived him to regulate literally a physical exchange of cash not conceived of for the internet age of how all of this has evolved. and just like the internet, an entirely new paradigm for almost like definition the laws that exist don't fit perfectly. i think the biggest thing that i am concerned about his regulators and lawmakers really being thoughtful about why fundamentally this distributed system is different and how that may in some cases mean that existing things don't really fit so well. >> somehow criticize general

currency in general. frankly, that is true of a suitcase full of hundred dollar bills as well but tell us some of the responses that you have to those criticisms and why bit coin can actually help in certain areas. >> absolutely. ..

they couldn't be further from the truth. bitcoin is the most transparent transaction element is ever desisted because fundamentally for bitcoin to work there's a large share of ledger this thing you might have heard called the blog chamber every single transaction that has occurred on the network is publicly recorded. it's admittedly a times like difficult to to address he was on one end and who's on the other. >> it's all about the transaction and it shows that a transaction occurred. >> that's exactly right so to the end of the day it's all traced and i think one area of the u.s. led the way on here was the money laundering division of

the treasury came out very early in march of 2013 and set forth basic guidelines around how you need to run the bitcoin business specifically you need to run it like you would run a business with dollars. if you are moving money you need to be responsible about who's putting money in and taking money out. so again early days of technology this stuff might seem a little scary but they are pretty good and there are rules in place already and i think it will be one of these things were over time it becomes a more powerful medium than it is scary. >> there a lot of people here in the audience who are going base in particular. what's the best way for them to learn more? >> the highest thing i would recommend is try to use it. i think learning by doing is the best thing. i have a friend who has some have them send you a bitcoin and try to spend it in cement on a bunch of on line retailers right

now. >> tick off some of the major ones right out. >> overstock.com is the first major one first major one to accept it for us. expedia if you want to plan a trip you can planet they are an dell.com except that in microsoft. it's really mounting. a rough timeline is 2013 or zero large parts so we are accepting bitcoin and fast-forward to today somewhere around 15 businesses are more than a billion dollars in annual revenue. i would advise go try it out. but marc andreesen wrote a great piece in "the new york times" called wide bitcoin matters. and why it's going to be an important trend. >> we have time for questions we can find out right now. who has a question for us?

yes sir. [inaudible] >> that's a great question. one in the early days of bitcoin were speculation really outweighs a lot of use of the mom and we think that will change as time goes on so that by definition reduces volatility. the other thing i would say if you just look at foreign exchange markets you have similar problems with volatility and what's happened over time as markets have got more mature you have things like derivatives on top of currency which allow you to head hedge outward -- risk exposure.

it will allow you to get them point where business software solution were bitcoin is a more sufficient transactional rail and the foreign exchange risk is hedged out. >> as use of bitcoins rose the currency will stabilize i expect the trend would continue on in the future. tell us a little bit more about coinbase in terms of number of customers you have or the number of merchants you deal with a give them a perspective on how it's grown already. >> on the customer front we started this business to a half years ago. we have a little over 2 million wallet folder today and it's a u.s.-centric business at the moment. estimates for bitcoin around the

world are around 10 or 15 million. it's growing pretty fast anywhere between 50 and $500 million and a transaction of the bitcoin network every day. which is something that's growing at a pretty reasonable clip. p1 people understand the technology they start to harness it classic network effect where it will create a lot more people faster. >> i was wondering if how government might use a process for example and boating in decision-making and things of that sort? >> this is getting into a lot of the other applications of the block chain of this kind of shared ledger that can prove a lot of different things for example the learning system.

this is why if you hear technologists calling about bitcoin that goes far beyond financial services and build a learning system on top of bitcoin where everybody is in control of their singular vote. it's audible by anybody. an issue for example even tickets to a concert on the this which now become freely transferable and even rules as to exactly how these transactions have to occur. so the important underlying point here is that this goes far beyond what one might think of in the early days as i'm sending a dollar value and i own a car deed or house the very voted for this candidate on top of the secure network that can prove who is really -- -- >> way in the back. yes sir.

>> thank you. my question is there anything you need from congress or washington d.c. like your highest priority for them to do or do you just need d.c. policymakers to step aside? >> two major things come to mind on that front. i think one huge victory for the internet in the formative years was in 1997 the clinton administration put out a very simple kind of guideline document on their view on the internet and how they wanted it to evolve and how they might view regulations around it. a very simple document that outweighed five bullet points each longer than three sentences with things like we will try to come up with uniform state tax policy as to how sales tax is applied for example or in general we would like to take it and is the better understand the

technology we will go in and establish more firm laws. something like that word takes uncertainty out of the system for entrepreneurs who are trying to build on top of it and similarly banks you might want to thank these companies because frankly that's a huge challenge. if i were to ask for anything else it would be that people like the u.s. ec who are ultimately the ones regulating these major banks do as much as as they candarelli understand the technology and enable upstanding companies that are trying to build these great ideas in the space to do so assuming the following guardrail set forth by the treasury last year. >> your number one wish for government is what most people in the tech sector and one government including congress understand the technology. >> that's exactly right in this stuff always gets a little

dangerous if you are building a singular company but if it's an entire protocol where there are many years of innovation that are difficult to predict that only becomes more important. >> absolutely antos everything else with the internet the light touch is what has allowed it to grow and that's not to say there isn't the opportunity to misuse any of the technology that we all deal with in the tech sector and therefore government needs to be paying attention to what's going on in doing the right thing to protect people who are trying to grow the internet and create a vibrant new economy. at the same time that they can snuff it out if they try to regulate something they don't understand. >> that's right and frankly the question about voting gets to exactly that where most people can't conceive of these things and that may very well not exist if you apply a pure financial regulation to it for example.

>> sir. >> hi. what kind of cost efficiencies does bitcoin offer versus more traditional payment networks? >> yeah, this is kind of being realized as we speak but on financial services tend to be closed networks. not everybody can join the ach network or the fed wired network network, thus there's a high barrier to entry and it's one of the classic spaces where it's been difficult on a date. what bitcoin does that's bitcoin does it's interesting as it flips that all its on its head by saying if you can develop software you have a good chance of going into business. the fundamental level sending or receiving bitcoin costs less than a sand and this is why you might hear people talk about oh this could be huge for micropayments in other words sending small amounts of money over the internet for example or huge cost efficiencies can be achieved. the other mind-blowing concept

and we have seen the proliferation of the 35-dollar android fine in developing economies. fundamentally bitcoin and announce software so the cost of opening a bank account is zero. you are downloading software onto a mobile phone and similarly sending money overseas is absolutely absurd to me that there are traditional companies that will charge you $5 to send $50 of value to someone in another country. in a modern internet age there's no reason that kind of value transfer should be so expensive. those are a couple of different examples and frankly speaking again this is why there are many implications of innovation like this but you effectively taken a large close financial system of transactions made it open and reduce the cost to moving some data around so much more efficient.

>> that would count for life stock exchanges and banks are taking notice and investing in your company and others. yes sir. [inaudible] >> adding significant cost so is if you are to list the two or three applications you think ordinary consumers who are not like bitcoin enthusiast that are practical what d.c. coming down the pike and how long will it take for normal people to use the kind of technology? >> sure. i do think it will be a large one. to your point you do have some kind of converter costs but if you look at the exchange markets those costs are on the order basis points up 4%. i think the second thing which

is a little bit more abstract will be it will make the internet in general more experience. one of the very strange things on how the internet evolved as there were no economics fundamentally embedded in the internet and this is why you have things like better advertisements all her web sites and spamming now. it's because in the case of banner ads there's no good way to monetize millions of people that might hit a new site

maybe a conflict of interest and gives the appearance of blessing the technology. >> while i certainly think that it's very important that the technology be allowed to grow. this is not something that affects any one business alone or any one person. it's something that has developed from the grassroots and it's important that congress needs to learn about it and understand it and they tend to do that and this is one way to do that. but issues related to technology congress hold hearings on those issues and so on but certainly it does not in any way different from any other sector of the economy that i take a keen interest in from rooting for the boston red socks and the judiciary committee has jurisdiction over antitrust laws

including the antitrust exemption so we are happy to entertain a wide array of different new technologies in congress and here at state of the net and my particular interest does not necessarily reflect what the interest of congress will be if and when it needs to act on any particular issue. >> well mr. chairman i think that's it. >> let me just close by saying that this is i think an important new technology and people need to be paying attention to. they're a great many companies. coinbase is a leader in this industry but there are many companies that are already in existence that are at applying their use of bitcoins and many companies that are providing bitcoin and other crypto currencies as well. not just bitcoin. we here in washington need to

take notice of them certainly the folks in the tech sector need to be learning more about figuring out how it's going to affect business. >> thank you all. >> thank you mr. chairman. [applause] >> i am david young with verizon a board member for the internet education foundation and i'm proud to introduce our next speaker who will be addressing one of the most pressing issues on the internet today and that is cybersecurity. you have all seen the headlines and read the stories about the latest hacks and data breaches and just last week president obama raised this important issue in his issue in his state of the union speech calling on congress to act swiftly. that's why we couldn't have a better person for next keynote then suzanne spaulding.

ms. balding his under-secretary for the national protection and programs director at the department of homeland security. she has spent the last 25 years working on national security issues which includes experience in executive branch congress and the private sector. please join me in welcoming undersecretaries spaulding. [applause] >> thank you very much david and thank you to the internet education foundation. it's a real pleasure to be here for your 11th annual state of the net conference and i want to applaud the internet education foundation for all of the work that you have done over many years to help foster an informed discussion and debate around the many complex and challenging issues that we encounter as we work to make sure that all of us can take advantage of all the

wonderful benefits that the network world has to offer us. it may surprise you to hear this from somebody who is leading the efforts of a core part of the effort of the department of homeland security around cybersecurity but i do periodically remind our folks that cybersecurity is not the objective. cybersecurity as a means to the objective that i just articulated and what we really are about is doing what we can to make sure folks can enjoy the benefits of the networked world. and we are focused on a daily basis at trying to improve cybersecurity across governments at all levels of the private sector in internationally to not

lose sight of that broader objective. and so i applaud the public awareness and education efforts of this group and others on all of you for being here to participate in these discussions. i'm going to thank you in advance for some of the insights that we will ultimately benefit from that i know will calm from the conversations that take place in this room and the overflow room and most importantly in the hallways during your break times. i used to start my discussions with groups by talking about educating folks about the nature of the threat and i really don't have to do that anymore. because all of you i know read the paper and watch the news and listen to the radio and have gotten letters in your mailbox telling you you are getting a new credit card.

you are all aware of the scope and depth and breadth of the challenge that we face as we endeavor to take advantage of the benefits of the networked world. from those who would use that networked world for their own financial gain to pursue political objectives or to pursue espionage or even destructive objectives. and so we look at this wide range of actors and activities as we endeavor to build up our cybersecurity. this is a top priority for the department for the secretary of homeland security jay johnson. our mission within the directorate for which i am the undersecretary that is the national protection of programs directed so we have a lead for

protecting the dot.gov, the civilian government assets systems and networks and for guiding the national effort, working with the private sector to make sure that we have appropriate cybersecurity across particularly our critical infrastructure sectors but across the private sector generally as well as state and local territorial travel governments. our particular focus for us is this these unique relationship with the private sector that the department has worked hard over the years to develop. and as i said our focus is on those things that are the most critical. that is to say those areas where a disruption would have a significant impact either on national security or on economic security on public health and safety. so we have divided that critical infrastructure universe into 16

sectors and that includes electricity and water and communications and transportation. includes financial services and chemical facilities and nuclear reactors a wide range agriculture, wide range of activities but basically it's all of those activities that really form the backbone of our society. and the things that impact your day-to-day lives. we put a particular focus on working with those critical and the structure owners and operators all across the country to make sure they understand the threats that they face from all hazards all of the ways in which that can be disruptive whether it is terrorist sabotage or superstorm sandy or majors dorm on the east coast or cyberattack. so we worked very hard to make sure we are bringing the skills together to take a holistic approach to risk management and

that's what we encourage ceos all across the country and the private sector to do as well. what they are worried about is the functionality to their ability to continue to provide the electricity for example. on some level they don't care what is the cause of that disruption. they need to work across those various threat vectors to make sure that the end of the day they can continue to provide that service and that is what we are looking for as well. so that means they have to look at all of those threats and hazards. they look at their vulnerabilities to all of those threats and hazards. they have to understand the consequences that result from all of those threats and hazards and i have to understand all the ways they can mitigate all of those things to try to reduce the likelihood of disruption. so we work through across nppd with our infrastructure

protection as well as her cybersecurity and our cyberninjas are the best and brightest in the cyber world and our analyst to look at the interdependencies and understand cascading consequences. to help and for most people who are making those risk management decisions across all levels of government and in the private sector. that in a nutshell is what we are about at nppd and the role that we play in cybersecurity and protecting critical and the structure and making them more resilient. so we talk about protecting security and the resilience of critical infrastructure and we have to think about that in cyber as well. one of the areas i think is not gotten enough attention in the cybersecurity arena we spend a lot of time and attention on threats and vulnerabilities and only now are beginning to realize how important is to understand consequences. as we look at the prospect for cybercyberattacks in the physical consequences we need to understand those consequences and we need to be prepared to

respond and recover just as we have develop that expertise in the physical world in the context of natural disasters. we need to get more agile in the cybercontext as well because right now while we can do some basic things that would prevent 80 or 90% of the intrusion activity and we will talk about that in just a second there is still that percentage up atop sophisticated actors advanced persistent threats and we have to be prepared to operate in a degraded environment, to detect bad things that are in our systems very quickly much more quickly than we often do today and to be able to respond and recover. that's what you see reflected in the cybersecurity framework which was developed under executive order by the president that missed the department of commerce develops.

we were much about the map of many of you in this room played key roles in the development of that because it was very much private sector driven. this is a framework that provides best practices for those who are looking at ways to improve their cybersecurity and its best practices that were developed by the private sector by and large. the most important aspect of the cybersecurity framework and i would encourage all of you who are worried about cybersecurity to take a look at it. the most important aspect in my mind is not that compilation of the best practices. helpful but those are are ready out there. what is really helpful is it really does give you a framework for thinking about how to approach cybersecurity suet breaks those best practices up into five categories. it tells you to start by identifying. the first one is identification. identify and make sure you understand in a sense the things that you need to protect so

that's important for you can't necessarily protect everything. think about what is the most important view to protect. i understand the threats that you face the risks that you face so there are lots of resources out there and i would encourage you to go to dhs.gov. we have got a lot of resources out there to help you understand and assess those risks and vulnerabilities. and then it says having done not look at your current posture with regard to your ability to detect bad things come to protect, to respond and to recover. figure out where you are on this list and then figure out where you would like to be and then plot a plan for getting from a getting from ev. the framework has lots of ways to help you do that. it's as simple as that in as as that an nsa sales while you often will hear a determined adversary can penetrate any system or network might make you

think why bother. i'm here to tell you that study after study has shown there are basic steps that you can take that are not expensive that can protect you against the vast majority of intrusion activity and it's important to take those steps. again the cybersecurity framework is there to help you do that. had dhs lead to the heart and soul of our cybersecurity effort is the 24 by seven operations center stands for the national cybersecurity communications integration center. our operations for and we have on that floor not only our cyber experts within the department of homeland security but also law enforcement sits there, intelligence folks are there the private sector of their. all come together to help understand the world that we are seeing and to develop ways in which we can get that information out to the public

along with advice about how to take actions to protect yourselves against what we are seeing our mitigation efforts. since 2009 when it was stood up has responded to half a million issues. we have put out 26,000 actionable alerts and ican i think the address is u.s.- u.s.-cert.gov and that's another entrée for you to see all of the resources that are there if you want to sign up for those alerts to make sure you were seeing what we are seeing and getting the mitigation measures. if you want help implementing that cybersecurity framework we have a whole program called c-cube vp, critical infrastructure cybercommunities a voluntary program and it is designed to help businesses and

individuals of -- individuals and businesses of all sizes to implement and use the cybersecurity to help improve their security so again i would encourage all of you to take advantage of those resources and take those basic steps. there is a lot of talk about cybersecurity legislation on the hill and despite the fact that folks kept saying congress was not going to move on cybersecurity legislation we were fortunate enough to have several major cybersecurity legislative bills passed in the last congress or at the very end of the last congress i know their congressional staff here and i want to thank all of you who worked on that and help us get that through congress. very important authorization for that operation center at the department so the private sector feels comfortable calling on us for help. we send flyaway teams and when

we get a call that a company see something funny on their system. they think they may have detected some malicious activity. we can come in and help them and they have a clear understanding of what our legal authority is. i was very important, important for information sharing important for that director was to the private sector that such a fundamental part of what we do. we also had legislation legislation that clarified a role for the dot.gov and that was very important because the information and the lessons we learn and the cyberthreat indicator information that we get for a work with departments and agencies on sensing activity in the dot.gov world we can use that turn around and get that out broadly and be due to the private sector so you can benefit from what we are seeing in the dot.gov world. so that's very important thirdly building that cyberpipeline of work for so we can continue to hire the best and the brightest

and that you can continue to have access to cybercyber professionals that all of us need. i'm convinced that we need to be much more agile and flexible in terms of sharing that cyber talent. the government's role in model has been take people and keep them for their entire career and it's clear and they cyber arena we are not going to be able to do that. we can't compete with the private sector salaries that we have a great sense of mission at the department of homeland security and elsewhere across the government and i think we can take kids right out of school who have a sense of mission and want to learn fast give them on-the-job training in our cyber environment. you will lure them away in the private sector with a higher salary than we can never pay. he will continue to train them and i believe at some point they will miss the mission and they will come back to us with all that private sector knowledge and awareness. that's a wonderful synergy i think for our two groups.

but that's a big part of what we do. public awareness is a huge part of what we do so an opportunity to talk to a terrific group like this is really wonderful. we work with venture capitalists. we work with the american bar association we work with auditors. we work with financial investors to all of them to say if you are looking at or engaged in transactional activity you are devising a client is a lawyer who is about to buy a small company or a large company where do a joint venture. if you are not including cybersecurity is part of the due diligence you are not doing your job. if your potential capital your potential capital is about to miss and start up and you're not making sure they have good cybersecurity practices you are throwing your money down a rat hole because that intellectual property will be going right out the backdoor. so all of those groups that have a way of influencing the market so that the market will drive

effective cybersecurity practices i think that's the most powerful way we can refer. but i need your help. this is a shared activity. you have comparative advantages. we have comparative advantages. we need to work together. something we work on every day to make sure we are bringing all of the resources expertise capabilities that we can to bear on what is a growing challenge of the cybersecurity. so again i want to keep you all on schedule and i want to thank you again for this opportunity and thank you for your interest in the subject. thanks very much. [applause] >> thank you undersecretary and for this portion this portion is actually launch so we are serving lunch along this corner here and on the far rim all the

way down you can have your lunch here because there's nothing coming into this room after this they can bring your lunch back here to the buffet and as we go into the next session we have breakouts. we have bitcoin on your program. that discussion will happen in this room back here. we have diversity in technology which is happening upstairs and we have the internet functions and transition upstairs as well starting at 1:15 so you don't have a lot of time to eat. thank you everybody. i survive this morning and i really want to thank you so thank you very much. [applause] [inaudible conversations] [inaudible conversations]

white house press secretary josh earnest to questions today about an iran sanctions bill and funding for the department of homeland security. this portion of the news briefing is 20 minutes. >> we will do a couple of things at the top and we'll get to to your questions. as you know the president is looking very much forward to speaking at the house democratic issues conference this evening in philadelphia. you can expect him to discuss advancing middle-class economic proposals from this day the union address. as we know this one the person will announce his budget will reverse harmful sequestration

cuts and instead show how we can invest in his vision for middle-class economics than making paychecks go further creating good jobs here in the united states and preparing hard-working americans to earn higher wages. the president will also make it clear congress needs to pass the full year funding for the department of homeland security and express his secure port for the democrats perm position and holding republicans responsible for fixing this problem. republicans have shirked their responsibility to fund the agency charged with protecting our homeland securing borders and enforcing immigration laws laws. in favor of a political stunt and it's now time for them to put their games aside so the men and women of this agency can focus on their important missions which is keeping this country safe to secretary johnson out of the homeland security budget should not be a political football. as all former dhs secretary's tomb tomb of them are public and have written in a letter to lawmakers today they said quote we cannot emphasize enough the

dhs's responsible his are much broader than is her sponsor villages see the -- overseas immigration borders and funding for the entire agency should not be put in jeopardy by the debate about immigration. so it should be a lively session with the president and house democrats today. in the state of the union address the presence that i want the country and eliminating polio and map the human genome to develop the return of the right time. that's why the prison will host an event at the white house that will include patients researchers clinicians and leaders in government and industry to announce details of his new precision medicine at initiative in the event present will highlight key investments in its budget aimed at improving health and treating disease through medicine. we'll have more information about the president's announcement telling today's briefing. that's something to look forward to tomorrow. with all that jim d. want to get

started with questions today? >> thanks. i wanted to get started with the budget. the president is asking for restoring money that has been sequestered to the tune of $7.4 million divided between domestic and defense. the white house says this will be accomplished by closing loopholes and ending wasteful programs. i wonder if you could give us some examples. seems closing loopholes has been part of different programs offered by the white house from passing reform to paying for some of your initiatives. can you tell us which loopholes you are isolating for this purpose and what wasteful spending you are isolating and if there is wasteful wasteful spending why not and wasteful spending and use it in this particular manner? >> jim we welcome your questions and is announced -- easy to

announce on monday. you will be able to look at the tables themselves. but you are right the president has put forward a variety of ideas about ways we can make our tax code more fair and more simple by closing loopholes. the best example is a proposal that we rolled out before the state of the union so a little over a week ago where the president propose closing a trust fund loophole. this is something that would save the u.s. government more than $200 billion. we are talking about a sizable recovery of revenue. >> the 320 used for both middle-class tax relief community colleges so is that part of this makes? >> what we have been clear about is that closing the trust fund loophole in some of the other tax reform proposals that were rolled up for the state of the union would certainly pay for

all the middle-class tax cuts the president proposed making it easier to save for college education and offer tax cut to families to make it easier for them to stretch their paycheck. all of those proposals will be paid for by the tax reform proposals and then some. there is revenue leftover that can go to other priorities. what you'll see in the budget when the president announces it on monday is as a series of important investments that will benefit middle-class families a restructuring of the tax code without deviating from the path of declining deficits that the president has made a priority. over the course of the last five years we have succeeded in reducing the deficit by two-thirds. this is the fastest sustained deficit reduction since world war ii and the president believes it's possible and in fact i think he has proved it's possible for us to make smart decisions with the budget to make our tax code fair and more simple and do it in a way that's

fiscally responsible. hugh has a very good detail questions that we will be able to answer on monday. >> as you all noted this is one for one half of the spending would be domestic in half would be defense. assuming this is the beginning of the negotiating process with congress is it fair to assume in knowing republicans want to increase defense spending that the president will not match equally dollar for dollar increasing domestic spending? >> that's consistent with the agreement that has been reached in previous budget negotiations over the last several years and that seems a principle that seems worthwhile. >> and during budget negotiations the deficit have been going down and part of the reason for that is in addition to perhaps the economy generating more revenue tax

increases on the wealthiest but it's also partly because of sequestration. you argued during the recovery that was a good policy to have. now you are arguing it's not good policy to have even though you are saying the economy is strong. when is spending a good policy in order for it to lower deficits? >> what we have said jim is certainly cutting spending makes since when it's in the context of not undermining the kinds of programs that are so critical to the success of middle-class families and the reason for that simple. the presence simple. the presence of wasabi is our economy will be the strongest was going to middle out which is why we shouldn't cut funding for programs that benefit middle-class families. in fact what we have said is that there is a better way in the truth is even looking back we believe there's a better way we could've succeeded in

reducing the deficit that would have asked those at the top of the income scale to pay more more to ask the big banks on wall street and financial firms on wall street to pay more. that would have been a fair way for us to reduce the deficit but republicans required of striking some compromises and even as difficult as it has been to work with republicans to find agreement on these issues that reducing spending and the president succeeding over republican objections to win or at least over the objections of the vast majority of republicans to raise taxes on the wealthiest americans a campaign promise the president made in 2007. all of that is a strategy that while it's not exactly the way we would have scripted it out it's a strategy that has succeeded in reducing our deficit and as you point over the last couple of years we have seen pretty strong economic growth. now what you would also hear me

say if that had they followed the strategy the president abdicated our economic growth would have been even stronger. but in some ways those are debates for the past. what we want to talk about now is the future and i do think the strategy the president has laid out focusing on middle-class families is one that certainly deserve strong bipartisan support in the congress. it does have strong bipartisan support across the country and i think it's also clear the president has some credibility around these issues now. he inherited a terrible financial crisis the worst financial crisis our economy has sustained since the great depression and because of many of the policies the president put in place even some policies that were politically unpopular our economy has come roaring back and the president is determined to make sure now that we have laid a strong foundation that we can now ensure the longer-term success of this country now that we have bounced back from this crisis. >> the deadline that islamic

terrorists have set for reducing the prisoner exchange do you guys have any information as to the status and the circumstances, the current circumstances? >> i don't, jim. i know the jordanians have indicated they are engaged in conversations with isil to secure the release of the jordanian pilot but for any questions about the status of the pilot or the status of those negotiations i would refer you to the jordanian and japanese governments that are involved in trying to recover their citizens being held hostage by isil. [inaudible] are you guys supporting that though? i know you can see then is better than we have before but

are you supporting it and what does it mean about what happens on march 24? if circumstances are such will the president request another delay if negotiations seem to be proceeding in a way you thought was positive like they have in the past or his march 20 -- march 24 a deadline for you? >> it's a general matter. we are pleased that democrats have put forward a statement indicating that they would hold off their support for legislation that would impose additional sanctions on iran until the end of march and is a positive development because the president has made the case as was evidenced by the letter sent by the democrats pretty persuasively that additional sanctions put in place against iran right now in the midst of ongoing negotiations could threaten the overall deal and this is a deal that has brought

the iranians to the table that has caused them to voluntarily take verified steps to roll back the nuclear program and a substantial way or at least in a meaningful way and to present a diplomatic opening that could resolve the broader international community's concerns about their nuclear program. >> how different is this in what we are proposing the first-place? those are the sanctions that kicked in once negotiations fail. they aren't imposing sanctions now on all they're saying now is they will impose new sanctions. >> a guess the point is the way this legislation would have been interpreted by the iranians but frankly more important by the international community a thing could reasonably be construed as the united states moving forward with putting place additional sanctions while the talks are ongoing. i recognize the legislation stipulated the sanctions wouldn't kick in until the end but i think a reasonable

observer to this process particularly an observer in this process that has worked closely with the united states to put in place the sanctions regime and in some situations add significant economic cost to the country would say why are you doing that right now? now we have an agreement with the iranians that they are going to rollback certain aspects of their program and engage in good-faith negotiations with the international community. why would we move forward with additional sanctions at this point in time? with the president has said is if the iranians make it clear they will not agree with the international community to come into compliance with international expectations of their nuclear program and the person will be the first person to go to congress and i think we are optimistic about our success in getting congress to move quickly to put in place additional sanctions on iran and then we can go to our partners who have been critical to the success of a strategy to implement the sanctions regime in a coordinated conference of

way that will only apply additional pressure on iran. we can do all of that if it's necessary and if the talks break down. right now there are ongoing negotiations and not -- it's not necessary to put in place additional sanctions. [inaudible] >> the president believes that we should not be in a position of putting in place additional sanctions while they are ongoing talks. it is now clear that they are are a significant number of democrats in the senate to share that view and we are pleased to have them on board with our strategy. it is clear that congress will not pass additional sanctions at this point in time. that's a good thing for the negotiations. it improves the possibility of success for those negotiations but and the reason i say that it's not because the likelihood of success has change because on many occasions it is at best a

50/50 proposition that negotiations will bear fruit. assess the likelihood of the success in negotiations would have been diminished significantly had additional sanctions been put in place. >> back on the budget went to see as the likelihood that this will pass? >> there is a republican majority in congress. they will have an opportunity to put forward their own ideas and what we have been clear about is for significant pieces of legislation to pass the congress and be signed into law they are by definition going to have to be bipartisan. so this is i think anyone would acknowledge who has observed this process even for short period of time would acknowledge this is the beginning of a negotiation but it's important. budgets are important because they are way that we can codify our values and priorities and what the president has codified in his budget that he will release on monday is we need to be making investments in middle-class families. now that we have laid a solid

foundation for our economy and bounce back from the worst crisis since the great depression we have an opportunity to get back to the fundamentals and make sure we are putting in place policies that are focused on middle-class because their economies going to be stronger long-term if it has grown from that allow. >> at some popular on both sides. >> you would think we'll be able to find bipartisan agreement. >> that is my question for you. is there where proposing something that would in the sequester for tax hikes which is what the republicans have rejected consistently into the comments announced this morning. >> we are open to ideas that republicans have. what the president has put forward is what he believes is the best way for us to move forward. his budget reflects a person reflects a person's view that we can make an important investment and policies that benefit middle-class families and a tax cut for a family with a mom and

dad were both working. giving him a 500-dollar tax cut is one example of the investments the middle class would like to make. we can do this in a fiscally responsible way and we can make our tax code more fair by closing loopholes that only benefit the wealthy and well-connected. over the course of the last five years years the president, there's a proven track record that in the case this actually isn't a vested interest of the country and in our economy but republicans will have an opportunity to make clear what their vision is and then we will have a robust debate about it. no president has put forward a budget with the expectation that congress is going to pass it in its current form. that was true when there was a president whose party controlled both houses of congress. congress is a branch of government. in fact the founders of our country made it clear in the constitution that the congress would have a responsibility of

maintaining the budget of the united states government. so this is an important announcement because it codifies the president's values and vision for the country but republicans in congress will certainly have their say and we look forward to seeing what they put forward. >> following up on iran on nuke nuke -- can you clarify her position and is there reason why the white house would support giving congress a say in the iran sanctions if the a deal is reached? >> well let me say a couple of things about that. first is congress has had its say and this is actually for all of the talk that admittedly you have heard from me about how difficult it is to do with congress this would be one area our efforts to put in place a sanctions regime against iran where republicans in congress have worked effectively together together. it's only because of the legislation that congress put in

place and the success this administration has had in implementing the sanctions are working with our partners around the globe that we have succeeded in putting significant pressure on the iranian regime enforcing them to the negotiation table. throughout those negotiations with the administration has kept members of congress in the loop on the status of those negotiations. my point is congress has had a saying we welcome their input to this the spotter for but as it relates to the legislation this is legislation that is legislation the president would veto simply because it would much like the curt menendez bill negatively impact our ability to reach a diplomatic solution to the iranian nuclear program and implement a future deal are the core program legislation would set a harmful precedent. this administration as i mentioned is committed to being in close touch with congress whatever the outcome but a congressional vote on a nonbinding instrument is not

required by law and could set an unhelpful president further negotiations that resulted in other nonbinding instruments. as we have said all along if we reach a deal that strength will stem from the enforcement of verification measures. we are not going to get a situation where we are taking iran forcefully. we will insist that iran agreed to verifying its compliance with a broader agreement. these are verification measures that can be implemented by the iaea by an independent body of experts to canberra fight that iran is living up to its promises and the president has said if iran does fail to live up to those commitments we will be in a place where we could slap sanctions back into place quickly to continue to ramp up the pressure on iran if they don't live up to the terms of agreement. congress will have a role to play but only after iran has clearly demonstrated its following through on its

commitments in key parts of its nuclear structure. >> lastly the keystone bill passed through its last major hurdle in assigning committee today. as the white house have a reaction to that? >> our opposition on the keystone legislation is well-known and if in fact the legislation that passed the house also passes the senate president won't sign it. >> will veto it. >> that's correct. >> josh getting back to the homeland security budget continuing resolution that is going to expire by the end of february obviously republicans insisted on that as a form of leverage in the hopes that the president might alter his executive action on immigration. while the president change that executive action in any way in order to secure funding for the department homeland security? >> no.

it's not going to happen. the funding for the department of homeland security is not a political football in the republican should not treated as one. the fact is and i know my colleague made mention of this yesterday that republicans for the last six years aggressively campaigned all across the country to the american people about why they should be put in charge of united states congress and we have seen now they are in charge of the united states congress and less than a month later they are threatening to shut down the partner, security. they're threatening to say we are going to withhold paychecks from the people who are on the front lines keeping america safe. these are transportation security officers border patrol officials and others who have an important role in enforcing our immigration laws and doing the kinds of things that are critical to our homeland security. but let me say one more thing about this. there was a lot of a lot of coverage at the end of last year in the beginning of this year particularly from republicans who are talking about how

important it was for political leaders to stand up for law enforcement. particularly in the aftermath of a terrible tragic shooting of the police officers in new york city. we saw some very aggressive rhetoric from republicans suggesting it's important for men and women in uniform to know that their political leaders have their back. i'm not sure what you can do two more undermined the relationship between political leaders and law enforcement than to threaten to withhold their paychecks even while they are doing their job. that's not the proper way to show our support for them. ..