. . >> and correct direct oversight

committees to come up with a replacement. lawmakers voters 239-186 on a measure to eliminate the complex web of subsidies, insurance reform taxes and regulations that extended health care coverage to millions of americans. the article goes on the whitehouse threatened to veto the bill saying it would take away critical benefits and increase the deficit. before the vote president obama met with ten people who benefited from the health care law. here is what the president said: >> why is it this is at the top of their agenda? making sure folks who don't have health care are not able to get it? it was maybe plausible to be opposed the affordable care act before it was implemented but now it is being implemented and

it is working. and people are being covered just as anticipated. the premiums on average are less than $100 when you take into account the tax credit. so it is affordable for the people it was designed to help. health care inflation is at its lowest rate in 50 years. the overall tab for the affordable care act is costing less than the original projection. in every respect this is working, not just as intended but better than intended. and so the notion that we would play politics with the lives of folks who are out there working hard every single day trying to make ends meet and look after their family makes absolutely no sense. that is the message i want to send directly today.

>> then secretary nominee ashton carter testifies at the senate armed service hearing. he previously served as deputy defense secretary and if confirmed replaces chuck hagel. we will have live coverage on c-span three. >> next, the testimony about the $4 billion budget. congressman paul ryan shares the house, ways and means committee hearing. -- chairs -- >> welcome to the committee ways and means hearing on president

obama's budget proposal with our united states treasury secretary who is sitting far away down there. our hearing room is under construction so this is temporary quarters for us. we are not used to the room. before we get started, be advised members may submit written questions to be treasury secretary to be answered later in writing and will be made part of the formal record. we under that the secretary has a hard stop at one o'clock so i will run this tight so we can get to as many people as possible but wherever we cut off we will start with that member in the queue next time we pick up with the next hearing just to try to play it fair like that. so secretary, i want to say something. we got your budget yesterday.

four years in a row you are late and the minute i leave you produce it on time. what gives? in all seriousness, the one positive thing i would like to say is it it a budget on time. and that clock means a lot. it means a lot of things. it sets the temp. congrats on giving us a budget on time. that said the irony wasn't lost that the administration submitted their budget on groundhog day. it is the same thing every year. you raised taxes by 1.7 trillion jow want to raise them again by 2.1 trillion. you want to tax saving and investment and small businesses. and sooner or later you will start looking for money in the couch cushions. i want to take an opportunity here to make something really

clear. we are not going to raise taxes on the american people. they are working harder and harder to get ahead and they are falling behind. wages are stagnating. they deserve another break. the kicker is with all of these tax increases you don't balance the budget because you don't get spending under control. i am disappointed in this proposing but as far as i am concerned i would rather spend time not focusing on our differences but let's find time and a way to see if there is common ground. i think there may be opportunity to do that. first thing i think of is trade. we all agree trade is good for america. more trade means higher pay. and so our top priority is to put in place trade promotion authority. to get the best deal we have to be in the best position possible and that is what tpa helps us

do. i will be interested to hear how the administration is helping get tsa across the efficiency line. next we want to fix the broken tax code. in the past, with this administration we have not had high hopes. but you have taken a few steps, in my opinion in the right direction, but in my opinion you need to move it further. you talk about fixing it for corporations but not families and small businesses. after this committee's meeting that tax reform can't be given unfair advantage to big companies over small companies the administration is finally talking about helping small businesses. even though your specific proposals are adequate it is a step in the right direction. the administration is taking a few more baby steps boy proposing ways to simplify the

tax code for middle class americans. i will be interested to hear what you say about tax reform. what the president is suggesting for sole priority and s corporations doesn't go far enough. small businesses are the engine of the economy and this committee isn't going to do just anything and leave them behind. this committee has to make sure they are part of the solution. the tax code has to work for everybody. especially families and small businesses. we need it make it simple, fair and competitive and create more jobs. that is the way to create jobs and build a healthy economy. we want to work with the administration and explore common ground. we have two big opportunities here on tax and trade. so we would like to get this done. let's see if we can find a way

of working together. with that i would like to yield to the ranking member mr. levin. >> thank you very much mr. chairman. welcome, mr. secretary, as the chairman said you are further away. we will try to make this more personal, though. i wanted to start on a personal note to recognize the fact someone who has served as our staff director on health this is her last hearing, and i don't know where shabel is. you are here? back here. thank you for all of your work. [applause]

>> back in the months of march 2009 weeks after the president took office the economy lost more than 1.5 million jobs. the most in any two month period since world war ii. today the economy is experiencing significant growth. with 58 consecutive months of private sector job gains over the past four years the u.s. has put more people back to work than europe japan and all of the world's major advanced economies combined. that is hardly a "stagnant economy". republicans try to minimize the dramatic turnaround. but they are instructed to visit what their parties presidential nominee in 2012 promised to achieve by his first term in

office. mitt rommey said and i quote i can tell you over the four years by virtue of the policies we have put in place we would get the unemployment rate down to 6% and perhaps a little lower. today nearly two years before that deadline the unemployment rate has dropped to 5.6%. the ongoing challenge we confront, the challenge that persisted for the last three decades, dating back to the reagan years, is how to ensure that middle class families are not left out of the growth of our economy. it is now being experienced and it will be experienced in the future. the president's budget takes direct aim at that challenge including proposal to support working families making child care more accessible

guaranteeing paid sick lever and making vital provisions like the child tax credit and the american opportunity tax credit, and combines changes in the tax structure and provision for the long-term needs of the infrastructure. it closes tax loop holes that benefit a select few. those proposals are not envy economics. they are everyone economics. they are not the economics of envy. they are the economics of working for all. not just the very wealthy. through a fiscally responsible replacement for the sequester the president's budget would allow us to invest in education, medical research and other domestic priorities and provide the resources -- social

security, medicare and medicaid -- that the irs need to serve the people. and it will provide for the military as they confront new challenges. i hope the republicans give these and other proposals presented within the president's budget the full and serious consideration they deserve. one of the many outstanding issues in the trade pacific negotiations is mainly in the purview of treasury. currency manipulation has resulted in an increase of unfairly traded imports and made it difficult to compete in foreign markets and cost us millions of middle class jobs. tpt includes a number of former currency manipulators such as

japan and other countries are discussing this who have been in the past manipulating their currency including china, taiwan and other countries. they have developed guidelines to define when it occurs. the problem is the imf lacks any enforcement provision. that is why i suggest taking the existing guidelines and building on them so they can bow addressed. i have heard concerns the u.s. monetary policy might be at risk with such a revision. but the imf guidelines clearly spell out the u.s. monetary policy including quantitative easing isn't currency manipulatiraq manipulatiraq. the united states has not engaged in the first step and we

don't have a second amount of foreign reserves. the imf supported each round of quantitative easement since the great recession. the u.s. monetary policy would not be put at risk by addressing currency this way. i look forward to discussing this in a bipartisan and bicameral bases and with the administration on how to include a strong enforceable currency manipulation provision and tapping into the other outstanding issues i outlined late last month in a document i called a path toward an effective tpt. thank you for your service for our nation and going back to the days when you were younger and

working for tip o'neal. i am very happy to welcome you back. >> secretary lew, thank you for your time. your entire statement is in the record. if you could try to summarize it in five minutes and we can get to our questions. we appreciate that. the time is yours. >> thank you chairman ranking member and members of the committee it is good to be here to discuss the president's budget. mr. chairman this is the first time i have appeared with you since you took the hammer. i applaud you. a year ago the president said last year would be a breakthrough for the country. the evidence is clear america is making strides in job creation economic growth family wealth, energy independence

manufacturing exports, stock market health care cost graduation rate and the deficit. our businesses created three million jobs last year. the most jobs in any year since the 1990s. this caps five years of job growth the longest stretch in the nation's history with creating 11 million jobs. and the unemployment rate dropped to the lowest rate in six and a half years and the economy had healthy growth into the second third and fourth quarters and forecasters are promoting promoting continued growth. many are still trying to crawl out of the vast hole left boy the recession. by now people have health care insurance and health care prices rose to the lowest prices in

year. and american taxpayers recovered more money than we invested. and thanks to the administration's energy strategy we move closer to independence and gas prices are falling. but, for too many hard working men and women in this country it is too hard to get ahead, support a family afford child care, pay for college, buy a home and save for retirement. the president is offering solutions to strengthen the middle class and make the dollar go further. this lays out ways to reduce spending so we can reduce taxes for family and many companies.

it will cut the cuts from sequestration and maintain a responsible fiscal path. as we know some were predicting the president's policy would explode our deficit but history is showing the opposite is true. when i was budget director in the 1900s, i saw this happening. but in 2009, it was a different reality. after years of run away spending, including tax cuts for the well off and two wars not paid for and the financial crisis, our deficit reached a post-world war ii high. the president moved to right the fiscal shift. the agreements forged with congress the deficit fell by three quarters and the swift has been down since demobilization following world war ii. the deficit is projected to decline further in the next

fiscal year. and we are putting a plan to lower it by 2% of our gdp. our nation's footing occurred even as congress was unable to undo sequestration and replacing them with sensible and balance savings. nothing has been done to address the cuts in 2016. funding for defense, education, infrastructure and research will be severely cutback. the president's budget eliminates sequestration and achieves a balanced fiscal approach. in other words, it will chart a way forward to keep the fiscal house in order but create room for pro-growth economic policies that are needed to keep the nation stronger in the future. one strategy of tax reform is to restore basic fairness and efficiency to the system. by scrapping tax breaks that reduce the tax for the most

fortunate for americans we can provide tax relief for those. our economy should work for everyone and everyone should maintain a share of this. bipartisan tax reform helps america be the best place in america to be the bes place to grow and live and create high paying jobs for middle class families. we can reach a common ground and simplify the system and remove waste wasteful taxes and lowering tax rates so we don't have a system where some businesses pay nothing and others pay the highest rates in the developed word. it is time to stop rewarding companies that have the best accountant and strengthen those that build and hire here in the united states. it is time rid inversion.

a thing in the past and this budget does that. a more fair efficient tax system creates middle class jobs and grows the economy. we know that with business tax reform there will be a one-time transition revenues. the president wants to use some of the one-time revenue to make long overdo repairs to bridges ports, roads and airports. this need is critical. this budget creates sustained funding tr a six-year transportation bill and starting a new bond program that will ignite more public-private partnerships across the country. and building on the momentum we have made and making it possible for every american to get ahead is going to require a strategy that is bold and effective and that is what this budget is about. it invest in education by

strengthening loans and making community college free for those that earn it. boosting the earned income tax created and providing tax relief for families when both parents are holding down jobs. it invest in retirement security by making it easier for employees to save for the future and businesses to provide 401-ks. and creating more advanced manufacture institutes cutting edge research and broadbrand to all areas. it will send measures to the president desk that helps the economy now including raising minimum rage fixing the broken economic system and fixing the roads. it will improve the lives of

millions of hard working americans and meet the responsibility to future generation. the task now is to find areas of common ground. i am certain we can get this done. i look forward working with the committee so we can deliver with the american people and i look forward to answering your questions today. >> thank you, secretary. there are four areas i want to get into. i just had one from your testimony. the sequester. as the author of the last agreement, bipartisan agreement i think the formula we reached in the last session was the right precedent. >> what was that precedents? >> it was we understand the mandatory side and the auto pilot spending is what is not under control and the source of our debt crisis in the future and needs to be reformed. so what eddy murray and i sat

down to do was find an ex ses accessive amount of savings to fix the caps for people i think on both side of the aisle had. but the precedent was you had more spending reduction through entitlement mandatory reform which got us sequester relief as well. we know it is show stopper saying let's raise taxes to pay. we need mandatory reforms of relief from the sequester and smarting spending. we have a good formula in place, good precedents, it has bipartisan origin and let's try to stick with that formula. >> i think the agreement you and senator murray reached was

important and it is one of the reasons we have been operating in a more normal way with one reason the budget could be on time this year. working together is important. we present our view of the best way to do it in our budget and need to work on a bipartisan bases to reach agreement. >> let's stick with the formula we had because it worked before. i want to ask you about pass passthroughs. i am glad you say business reform instead of corporate. 80% of american businesses are not corporations. they file their taxes as individuals. llc's, subchapter s and so on. the issue that is a greater concern is unlike the big public companies and the ability to barrow at low in the rates the closely held businesses have found it hard to obtain credit

these days as banks have restricken lending. we have a cash flow issue. they need cash flow to keep people paid and working. but the current code is making it harder to do that. the budget is taking baby steps and section 179 has common ground and we will be doing that tomorrow. but other proposals like expanded cash accounting are only helping small c-corporations and don't do much for the vast majority of small businesses. so will you work with us to explore more areas in trying to help these closely held family businesses we think of as passthroughs to help figure out their issues because in this post dodd-frank world they have tighter credit. >> i believe our proposal reflects our commitment to

making tax reform work. we call it reform on purpose because it is corporate and small business tax reform. we put in our plan a number of things to simplify tax for small businesses and make it possible for deductions easier and quickly and lower the tax burden for many small businesses. a lot of different kinds of companies organize as passthrough. some are mom and pop businesses and some are large corporations. we look forward working on a bipartisan bases to work with small families companies. >> all i am saying is i don't think there is enough in the proposal to do justice to what needs to be done. let's keep working on that. transition -- i want to get you down on the record on this idea of tax reform financing highways. your point just to be clear is not to support a one-time

repateration holiday like we did in 2004-2005 but only as means to permanent transition to a hybrid system you call it. under that scenario do you see tax reform as part of the solution to the highway trust fund issues. >> we pointed out we thing the one-time holiday created a preverse incentive. it created an incentive for companies to keep their earnings overseas until the next holiday. we think we should change the structure so they are bringing the money home or investing it where it is economically efficient . the tax code is skewing ways in a way that is inefficient.

we think the toll charge is the right way to have a transition and believe the one-time revenue can fund the highway infrastructure program in a big way. business leaders in the country say we need to reform the tax code we need to build the infrastructure and three immigration reform. we can take care two of three here. >> i would take issue with the rate and style you are doing but putting that aside it is a move in a constructive way. we see it differently but it is for a permanent conversion to a permanent new system. last question is eitc. the data is clear it is effective. it is effective at moving people from poverty into the workforce. it is effective at lowering barriers that are in front of a person who wants to get into the

workforce. but it is also a program that is known to have a high degree of fraud. it is known to have a high improper payment rate. a lot of people say give the irs more agents and they can fix that. that is an in sufficient answer. will you work with us to try to figure out how to clean up the management and the structure so week get at this high improper payment rate and are their ideas you have about how it could be restructured and reformed so it truly knows those who are truly supposed to get it and not to others? >> mr. chairman i totally agree with you on the importance this as a bridge to work and get families back to work in a way that makes good sense. it has been a bipartisan commitment from its inception and i look forward to working for you and strengthening it.

the under funding of the irs makes it challenging in many areas to put the resources that are needed into compliance. so i hope we can work together to make sure the irs gets the resources it needs. it recovers or prevents $2 bill billion in claims and $4 million a year. we need to do better. it is related to the resources available. >> i think many of us agree there are other populations this reform could be applyied to; let's say childless adults. if we can contain it that would be huge and maybe lead to bipartisan common ground success. >> we look forward to working with the childless provisions. it is something i think would

fill a gap in the system. i don't know whether the cost would be covered by it but i would be happy to lackook at it and work with you. >> mr. levin is recognized. >> mr. chairman you and i had a few discussions about the issues and we want to do more. i will ask a broad question briefly. let me talk about paththroughs. i think it is one of the major -- passthroughs -- challenges to tax reform. it has to be looked at comprehensively. we will mark up 179 and other bills tomorrow. i think it is mistake to take it outside of tax reform unpaid for, permanent. mr. secretary, you have expressed your view on this before. did you want to comment briefly on that approach? >> congressman, we are opposed

takes the items one by one and making them in an unpaid way even in a provision we approve of. i think section 179 should be addressed and expanded in the context of business tax reform and if we can have progress on business tax reform that would be a good way to get it done and takes the issue off the table for the future and removes the uncertainty that knows with short-term extension which is where we end up without tax reform. >> and in terms of international taxation secretary mentioned how i think totally unsuccessful this was before and the administration came up with a hybrid system. i think we need to get away from the labels and look at how it might work. let me say as we continue the dialogue, i think we need to look at eitc in terms of its imp

implimentation. cutting revenue appropriation for the irs is not the way to go. you cannot get tax enforcement when you cut down the irs appropriation. mr. secretary, if you would, i have almost three minutes. you talked about middle class economics, just tell us if you would, sum it up briefly, was the vision of the administration when they present their budget. >> congressman, i appreciate the question. we put a lot of thought into how to discip -- designing a budget

that work for the middle class families and the families trying to move into the middle class. we have put in place a series of provisions we think will make a real difference to make it possible for middle class families to get ahead. the economy is growing at a much better rate than most of the developed world but within the united states it isn't an economy with broad opportunity as there should be. i think the provisions in the budget provide the first step to solving that. some of the characterizations of the budget had a bit off. it isn't about being against one group and for another group. it is about making the system work for everyone. and the truth is we have

distortations that allow those with the most income to avoid paying taxes on the same bases all of us do. let me use an example of stepped up base and compare to the way we pay taxes on ira and 401-k. for anyone who needs to use the assets they build up for retirement you pay income tax on that. if you never need access to your savings, to your accumulated earnings, you can pass it on tax-free. that is not right. our system ought to treat all earnings in a similar way. it isn't against anyone. it is for everyone. >> thank you. >> mr. johnson? >> thank you mr. chairman. you know welcome, mr. secretary. as you know you are also serving as the managing trustee for social security.

and i would like to if week -- we can get a quote on the screen. this is what obama had to say when he was first elected. what we have done is kicked this can down the road. we are at the end of the road and not in a position to kick it any further. we have to signal seriousness in this boy making sure the hard decisions are made under my watch. not someone else's. that is the president in january of 2009. you know we have to signal seriousness and my question to you is do you agree with what the president said then yes or no? >> you know, congressman, i think if you look at the condition of the social security trust fund is stronger and the president says we need to deal with the long-term problems

bipartisan way. we have proposed a budget that will help social security. even the immigration policy would have the effect of lengthing the life of the social security trust fund. we think we have improved the conditions. >> i am going to disagree with you. because it doubles from 5.3 trillion to 10.6 trillion while you have been in office. and that means social security can't pay the promises it has made. my next question just for the record, do you agree the social security finances have continued to declined since the president took over? >> the baby boom retirement is underway. so if you look at the trend in social security financing you have to take into account it was

a predictable turn the reserves would be used to pay benefits. >> then why didn't you make a real plan to fix it? would you agree the disability program is in trouble? yes or no? >> disability is a bit of a separate issue from the old age fund. someone involved in the 1983 social security reforms we did a lot to fix the foreseeable shortfalls but the problem is the money was spent along the way. so it isn't a question of what happened in the window of this administration but what happened before. the disability fund is approaching their exhaustion date. i think there is a broad view there is going to need to be reallocation of trust fund. the taxes between the tax fund to deal with this issue in the interimmediate term. >> let's talk about reallocation

reallocation. that is about taking money that would have gone to retirement and giving it to the disability program. is that true or false in >> it would move revenue from one part of the trust fund to the other. >> sounds like we are continuing to kick the can down the road. we have to work to strengthen and secure social security. will the president do something about this? >> the president has been prepared on a number of occasions to have the conversations that have to happen on a bipartisan bases. they didn't reach the end that led to an agreement. i think right now we are looking at an economy that would benefit from us working on the things where we can reach bipartisan agreement and we have more time to deal with the long-term

issues. i am not saying they don't need to be addressed but it need to be an environment conducive. >> will the president do something on his watch to fix this? >> we look forward to fixing imfracasim imimmigration reform. >> porns are paying hundreds of millions into social security and they want -- americans -- and need more. >> mr. rangle is recognized. >> i understand mr. johnson thinking the president can do something by himself on his watch. i will advocate him being more aggressive aggressive. having said that welcome. it is difficult to look at you and not think of you as the kid that worked for tip o'neal.

you have made us who serve the government proud of your service. i am pleased to hear the chairman, you and all of us agree there is a possibility in the area of tax and trade policy that is a possibility that we can find some area that we can agree with. both of these issues as important as it is to the country, we need to get both of them. it is difficult for some of us to go into the community and say why for tax reform or trade. people are really talking about what does it mean to me and how will this affect my future. what deposable income will i v. pension benefits? can i pay the house and rent? it seems we allocate jobs with trade. and certainly we can negotiate the tax bill so we can be fair

to the middle class. i don't see the jobs in this bill. it is probably difficulty to pinpoint exactly who the winners and losers will be in a trade bill. to find out where are the jobs going to be because if week can do this we can get rid of all of this republican and democrat and free trade business. people want to know if it is good for the country how it will be good for me. it seems to me that if we do have a good trade bill, we will need infrastructure in order to support the trade bill. i don't see how anybody, regardless of the party, can go to the mayors and governors and not say that infrastructure is a part of trade. the other thing is also

education. whatever benefits we get we have to have a workforce prepared to meet the new economic challenges if not for the current workforce for those that are into being. i wish the administration would be able, and republicans as well, to try to well, to try to give some of us a package. so we are not talking about theory but we are talking about jobs. if the republican majority can see their way clear and attack education, job training infrastructure, to a trade package, i can tell you that trade would mean a heck of a lot more to our voters than something phone [speaking in native tongue]. s -- foreigners are dealing with. if we can get that concept that is president accepts it and it is part of the trade agreement i don't see any objection of giving the president the

authority to negotiate a trade agreement meaning those things are going to be in it. but i find it very difficult for us to say we are giving the president the authority to negotiate and when the negotiations are complete all we have is up and down and no input. so i don't know how much time you have to respond but whatever it is i do believe trade and tax reform bring us together for the country, party and certainly to improve the image of our congress. >> congressman rangle the basic reason we support trade promotion authority and good treaties is because we think it grows the united states economy and the middle class jobs in the country. you look at the growth in the future. the growth is in emerging economies. it is in the pacific and areas where other countries are going to be exporting into the those markets and we need to be

exporting into the markets as well. tpt was designed to be an agreement that would drive the standards up. the united states is more open than most other countries are higher labor and environmental standards. by having an agreement where we make our high standards a mutually agreed to standards and having a world where we have access to the growing market, i think it will grow the united states employment base and create opportunities for middle class families to have a better future. trade promotion authority is actually something that puts guidelines on the administration to help drive things in the help direction in the areas i described. and it will address those issues. it is your job to come back with an agreement that delivers. and we will not bring one back that we cannot defend as growing the economy and middle class

jobs. >> thank you. >> thank you mr. chairman. as you know next month the supreme court is going to hear hearings on if the irs overstepped boundaries on the federal exchanges. the court is expected to announce their decision before the end of june. can you tell me if the treasury department or the irs is doing anything to prepare that they might be ruled against. >> let me tell you the affordable care act is working. >> but the court is ruling specifically on the irs rulings >> our lawyers made the argument, the justice department made arguments we think are compelling to the court and we look forward to a positive

ruling. but the thing we have to recognize -- >> but secretary, i don't want to interupt. i am not asking for a prediction in the ruling. but in the possibility the court rules for the plaintiffs, what planning is the irs doing to deal with that? >> there is no reasoning why that would -- >> you would bow based on that starting to work for that ruling now? >> the premium tax credits are an essential part of the affordable care act and if removed there would be disruption in the markets in many states. >> to ensure there is not a serious disruption is the treasury planning for the ruling in the other direction? >> we are continuing to

implement the law as it was written which is to make sure all-american people have access to health care. >> let me ask you. are you guaranteeing the super bowl is -- supreme court -- is going to rule for the you? >> we are applying the law. >> are you guaranteeing they are going to rule for the irs and you have to do no planning. >> i leave it to the justice department. they made a compelling case. >> but you would not guarantee that today that the supreme court is ruling for the irs? >> i would never presume to speak for the supreme court. >> i agree. because there is a possibility

they may rule for the plaintiff and i guess my question is should that occur, republicans are already working to develop a thought thoughtful plan and a thorough plan to offer these millions of americans choices to have affordable, high quality, health care. we are doing that work ahead of time. is treasury or the irs doing the same type of work? >> this issue is before the court. i cannot comment on the pending litigation. >> i am not you to do that mr. lew. i am talking about planning and the possibility of the ruling might be otherwise. are you planning for that? >> we are confidant our under

understanding of everyone in the states and the ruling will stand. >> a moment ago you said you cannot guarantee the outcome. let me ask you this as the republicans work toward a thoughtful thorough plan to address bill in the case of that ruling will you work with us or do you refuse to work with the dealing of the ruling? >> congressman, the oral argument hasn't taken place. the ruling is months away. i indicated if there were a ruling that took away the tax credit it would be disruptive. >> right. and in that case will you work with republicans in crafting the solution for those americans so they can have high quality, affordable health care. this is simple: would you work

with us? >> i think it is never a simple answer. >> will you work with us or not? >> i am indicating it would be a serious disruption. we would look at the suggestions made but i will not prejudge what the administration will do. >> mr. lew, i applaud the president's effort to support the middle class. all through this bill whether it is social security or medicare or student debt the president made proposals. but my colleague from texas is posing that if your next door neighbor takes a bull dozer and knocks down your house, do you have a plan to rebuild your

house. it is an unreasonable idea. the republicans in five and a half years have not proposed any alternative to the aca. in fact this afternoon, at 1:30 they are going to bring a bill out to repeal it for the 55th time. now, it seems unreasonable to waste your time planning for something. if they have something they want to bring forward they can lay it on the table in the ways and means committee or energy and commerce committee. they have never put anything on the table. i want to talk about the proposal of the freeze close the loophole put in the collection of social security taxes. could you explain to me -- my understanding is if you have a

chapter s corporation you don't have to pay your employment taxes. so you don't pay for medicare or social security. now, when you get old, you get 55, are you eligible then to go in and get social security and medicare in the program to which you have not paid one single dime? >> congressman, if i can respond on the point you made about the bulldozer. i have tried to indicate the good degree of disruption would be enormous. i think it is important to recognize that what we should be work together on is how to make it more affordable and possible for americans to get health care. we have been open to working on that. i think the american people are tired of the debate about repealing the affordable care act and they want to hear more about how to make it work. >> i agree.

>> on the question about eligibility for medicare. there is obviously a significant issue. the proposal we have in our budget would tax all earning s- s-corporation as labor earnings. the taxpayers get social security and medicare based on what they paid in. and that would address the underlying issue. >> so those people are not now eligible for receiving benefits if they don't pay in? >> i believe they are -- they pay in but they don't pay in as much as they would. the question here is not whether they are eligible for benefits but whether they are paying in on a fair bases. >> i think it raises $74 billion for the trust fund. >> i believe the issue is a question of making the payments associated with the incomes they

have. >> i would like to raise a question about student debt. can you give me any reason why students can't renegotiate their loans if they took a loan out at 9% from a bank why does it have to stay at 9% for the rest of their life? on my house, i have renegotiated my loans three or four times bringing it down to a lesser rate. why can't students do that? >> congressman, we have looked at this issue and worked with the congress to come up with proposals that will give students flexibility in terms of managing their student debt. they are designed to give favorable access to credit but the rates are not at a level that feel competitive with what would be available if there were

a credit worthy borrower out there. the challenge is to work through the issues and make sure that students know all of the options they have to repay their debt in a more affordable way and consolidate their loans. >> do you understand the financial system when you were 20 years old? >> the financial system was simpler when i was 20 but probably the answer is not as much as i should have. thank you. >> thank you, mr. chairman. secretary, welcome. i think most of us are hopeful the administration is willing to work with us on tax reform and i am hearing you say you are. that is good news. from mr. brady's questions i

took away from your lack of an answer on his question as to whether or not if you work with us depending upon the supreme court's decision. that lack of a yes or no answer indicates there is an unwillingness there and i am hoping it doesn't transfer to tax reform and other issues. i want to focus on the small business passthrough question. you made comments i find interesting compared to the language in the budget. i want to get to the bottom of it. ...

>> went on to do something more bold to begin with if that is the way to you in the president felt about small businesses? >> congressman, i think that we have done a number of things that will help small businesses -- >> my question is why did you not do more reign. >> we agreed -- >> you agree with the chairman and you said that we will do more and we will work with you. my question is when you do more

first? >> we put forward what we think is a good package. if there is a desire to do more, we are open to ideas and i think that we are trying to come up with ideas that actually work but don't have been unintended consequences -- >> i will ask you again -- >> i will be perfectly candid. i said that this is a complicated area. an area where i think we will benefit all of us. >> can i get you to reaffirm that he will work with us? >> i said we will work together on this. >> tomorrow as mr. wrangell and mr. levin talked about i think that we will talk about these areas but that's corporations and making some of those perman.

i just want to talk about the policy. he said the you agree with and can you give me an example of how the small business measures and legislations can be expanded. and can you give me an example of how you might expand in incorporation? >> we have taken up to $1 million, the amount that is the expense and a single year. -- >> can you give me an example? >> i gave you an example we might you have always said that. you me another one. >> your asking me to present things that we work on in the future. >> i thought you might have some ideas. you know, recently, we adopted a rule that requires the cbo to

perform a macroeconomic analysis of legislation. this treasury have a dynamic model? >> you know, both the treasury and the other take and keep track of this -- >> you have one? >> yes. >> okay, i yield back that was easy. >> mr. lewis is recognized. >> thank you, mr. chairman. >> thank you mr. secretary for being here today and for your great work over the years. mr. secretary, i want to make it clear, make it crystal clear. but the republicans today you will repeal this, the president said that he is going to veto it, maybe he has changed his

mind and he will not veto it. maybe just that. >> okay. >> what would happen? what happened to the hundreds and thousands and millions of people. >> we have 10 million people with health insurance coverage that didn't have it before. and the challenge of providing the kind of security that family only knows what has health insurance has taken decades to accomplish and i think it could be a bad situation. it's why the president would veto a measure that would repeal the affordable care act.

>> thank you very much mr. secretary. what does the budget due to help more americans to prepare and save for their retirement? >> what is in the budget? can you explain what is in the budget will help more americans save for their retirement? >> one of the things we have done is created incentives for employment to cover their workers giving them tax benefits for setting up a plan for matching contributions, we build that on top of the proposal that we started last year. and they would be able to start with a very safe and easy starter retirement account. for years we have had proposal

we're employees ought to retirement where they have dropped out and we are making enormous progress were rear looking at retirement savings a sound future. >> are we saving more or less rematch. >> i think is a country we are obviously, our savings rate are improving as our economy is improving and we need to be middle-class workers saving more for their retirement. if you look at the distribution the average amount that most middle-class workers have is not really enough for them to rely upon and you kind of have to strip out the averages with the large retirement accounts. we are concerned about working families are doing to take care. we are trying to put this together to move this process

forward. >> sir? >> thank you mr. chairman. secretary lew, there has been a lot of talk about helping small businesses, affordable health care, so forth and so on. but i have a real can turn about an action that was taken in september 2013 when you issue a regulation penalizing the use of health reimbursement arrangements by employers as a means of financially assisting their employees to purchase health insurance plans on the individual market. why would treasury institute is kind of a draconian penalty on small businesses that we have heard earlier? >> congressman, we have obviously moved through the affordable care act into a system where there is an established way for plans to be put forward and for workers to have access to coverage. we are working hard to implement

it and make sure that it is easy for small businesses to take advantage of it and for workers to participate in. >> the complications with this the penalty amounts to 10 times of fines that would be imposed on larger businesses. and large businesses under the employer mandate will be subject to a 3000-dollar annual fine per employee. but yet if you total up the penalty of $100 per day, current employees in small businesses, we are talking about $36000 per employee in small businesses. that seems to belie the sentiment you are trying to help small businesses and working families. >> competent, our objective and the objective of the affordable care act is to make sure that affordable health care is available to all and i believe that the provision that you are referring to are not consistent with that. i would be happy to follow up.

>> over 40% in my district, yet we have this and we really need to work on this. if i can get back to the budget for a moment, in case members don't recall this is -- this was to recover the cost that were paid in the 1970s and this program, this tax stuck around for a long time. we finally ended it in 2011 and yet they want to revive this temporary tax in the budget. >> for a number of years now we have been putting forward proposals to try to make sure that the unemployment system is on sounder financial and we will

be working in a bipartisan way to know that this is on sound financial footing going forward. >> we will work with you on that and i hope that we get to some resolution and specifically with regards to china, this has to be a top priority and i would be very interested in getting it and getting a full understanding of what treasury is doing with regard to that development in our negotiations with china. likewise with india because the president just announced that we will resume negotiations on a high standard investment treaty. and we seem to be miles apart from india, even on basic conditions of investment. so there's not much time left i'd like a detailed answer. >> having to get back to you in

more detail let me just take a quick shout out. i've been deeply involved in discussions with china and there is a strategic and economic dialogue that has a very important conversation because if it concludes successfully china will raise itself in normalizing and improving trade balance. >> and empowers us to make the changes internally and it stops them from doing things and are lashing -- internationally. >> what i would like is this. >> they are just taking the first step very shortly putting on their first cut of what is the list of industries that would not be opened. the negative lists two that would be an important indication of seriousness. >> i would like to stay in contact. >> thank you, i yield back. >> thank you mr. chairman.

>> secretary he would have congratulations on your proposal. a reminder that much that is determined as much to do with a lack of professional standards and tax repairs, we have a sense of conversations in the past with the staff and there seems to be conceptions on that as well. including what will happen with 179, perhaps we should expand the itc. and thanks again if you acknowledge this, we have worked on this in the last session and i hope that many people are not in a retirement plan we can be able to expand these retirement savings, word of congratulations on the tax credit program, expanding that that includes

expanding urban areas across the country and alan krueger was a terrific advocate of that. it is working quite well during those years for members of this committee who have one. and after pointing out that there were many avenues of agreement here given the history of massachusetts having worked cheering for the new england patriots you can also know that they are offering this in regards to massachusetts. i think it deserves some credit in the administration for the lowest inflation rate as it relates to health care in the past 50 years and the aca has received some and knowledge of and for that. honestly you are attempting to preserve and improve medicare for future retirees as well as

those that are receiving it now. but i would carefully suggest that that is a huge plus for america and helps us set it aside in the pacific northwest as boeing and microsoft and those of us have graduate medical education and i hope the administration will treat it with the same regard as they do other initiatives that have been proposed, i think $16 billion in terms of the cuts are a bit over the top and i hope that you will have due consideration for the proposal that you're offering and to really set it aside to be the next few minutes to talk about the proposal as i had talked about. >> let me talk about the tax credits and the bonds you have talked about, we have agreed very much that they have made a huge difference.

and we are honestly considering new market tax credits, which is also a bipartisan administration, so we can do things together in a bipartisan basis to create real opportunity obviously the issues regarding this is always difficult in this includes proposals from past budgets were we have the savings in medicare and as always we look forward to working with congress to develop a path forward and it's part of a comprehensive approach to deal with our fiscal challenges. and i think that it will deal with the entirety of the package and it is an issue that i know is a particular concern in

boston and massachusetts and new york. >> thank you. sir? >> thank you, mr. chairman thank you for your time today. you are commenting on the president's budget and the agency that will collect the money to enact our next budget. it is the internal revenue service requesting over $3 trillion as you know. we made an argument that one of the things they needed was more resources and let's set that aside for a moment. the other thing that they need is a reputation as calling balls and strikes, and also as being a fair agency. so the resources and reputation are at the foundation for any tax collection that is going to have integrity. i thought it was interesting that in your written testimony even talk about the reputation

of the internal revenue service and the damage that has happened in the past couple of years. back in the summer of 2013 when you were asked on national television, you dismissed it you were fairly dismissive and that you characterized it as a phony scandal. now this committee made a referral to the attorney general last year and i assume you have read the referral letter and the supporting documents, having you remap and then lied about you would not characterize this as a phony scandal, would you to . >> i'm happy to discuss the reputation of the irs on these issues. i believe that the rs is doing extraordinarily effective jobs and the difficult circumstances where they have been underfunded and not given the resources to do. and i have acknowledged from the beginning that the actions they

took place have concerned me and they involve a small number of people at the irs and we took immediate action to discipline the people involved to make sure that the supervisors who are responsible are no longer there and we have i think, if you look at the way they have managed under very difficult circumstances, with less resources and we don't have people to answer the phones and we are answering this in a timely way. >> dismissing this down, you know there were some bad actors and here's my question. what have you done to prevent a lois lerner 2.0 situation. if you think about it, she was the person that put together a panel of three senior career

employees it had to be the threshold before an audit could happen and she was the person that went around that very safeguard that she structured and she said in an e-mail where she was really quite aggressive with one of her employees. this is after two times this three-person panel said look we are not going to understand. so we are wondering why we haven't done something with this. i don't think the your guys get it. >> mr. secretary, what is it that you have done other than calling this a phony scandal on national television? what have you done to make sure that lois lerner 2.0 is not possible? >> they said political employees

were behind this and that's just handing the answer. one is a director. >> i think that if you look at the inspector general report that came out we have made clear that the behavior was unacceptable. we have a new commission and senior officials who are very much aware of this. so we have been dismissed it. it is one thing to take action in response to what happens with a small number of people and a large agency and it's another thing to condemn the agent we which is what i believe many are doing. >> i think that when the administration is essentially coming around us don't you

understand how that is corrosive >> that his dismissal. >> there is nothing more dismissive. >> thank you. >> the gentleman is recognized. >> thank you, mr. secretary thank you. you've heard it already. the earned income tax credit, many of us do that. as the middle class continues to get squeezed, they see everything that has worked in the economy for worker profit and that wall street. but they haven't seen their paychecks grow in the way that they would like. thank you for speaking to those families who have been working hard. they have been more productive than american workers in the past and they just want to see their paychecks grow. the earned income tax credit for those families is going to be

for working families that have kids, who aspire to have them go to college, can i just applaud you and the president are focusing on child care. my daughters are there, but i know there are a lot of individuals back home who are wondering how they're going to get there and they have to make sure that their kids are taking care of. and that includes those that are working. to thank you for what you're doing there in that regard. so how will the president talk about this with -- are we talking about thousands or millions? >> i don't have the exact number, but it's many millions.

those millions who are striving to gain the middle class ultimately go beyond the middle class. because you will get good childcare if the two of you were, you will have an opportunity if you're still doing it the way that we want people to do it. just touching briefly on something in regards to security today there are about 160 million americans were paying social security and they have the deduction. the federal income contribution allocation that is deducted and it's part of another act as well. old age survivors and disability insurance. that is what this is. if you work in the retirement

age, you get social security. he paid in. you get it even though you are disabled or your family does. if you die but you pay into social security, your survivors did social security. it's insurance to the family. i don't think anyone works and pays into this and says that i only want my money going to retirement or i know i'm in a risky job and i only want my money to go into disability. in fact, 11 times this congress, not this one today but over the years whatever administration we work to make sure that we always have the money allocated for the disability side of social security and the survivor side of social security or the retirement side of social security and none of it can be made available for those who

have become disabled for their families. eleven times over the years congress that the administration -- they have work to make sure that we always make sure that the money that is out there goes out to those americans who work and pay into this fund. and so i hope that we don't upset those 50 million americans were receiving social security. 11 million of them disability insurance under social security, for them to say that we can't make that available because some technical glitch here in washington is preventing us from moving forward to do what we have done in the past 11 times on a bipartisan basis where there is retirement social security, disability social security, or because you died and now you survivors need social security. i hope that we don't play that game.

and finally i just want to mention that we don't leave out currency manipulation is something we attack. the last thing we need to do is send a signal that we are going to allow government this. >> the time of the dumb and has expired. >> a yield back. >> the job and is recognized. >> i want to thank the secretary for being here today. i mentioned to you earlier the number one issue in our district, and that's a lot in florida, is the idea of this functionality where we serve a lot of our constituents and that is the biggest thing that they are passionate about. so one of the things that i hope i am hopeful for in the next six

months, that we can work together on a bipartisan basis for the importance of an american people. i'm concerned were we are looking at raising taxes with more debt of another 8.5 trillion and a budget that never balances. we are an aspirational society, anything is possible in america. i don't want to punish one group over another group. president kennedy mentioned that this -- when you talk to various experts they talk about if we could focus on growing the economy growing at four or 5% if we get back we can fix a lot of challenges that we got in america.

>> still any of these policies we are putting forward, does this grow the economy? how would you respond to matt. >> congressman, on your point about working together in a bipartisan way, i could not agree more that would be a good thing for the country and we would feel this is it was working well. i saw in the 1990s when we had a divided government and you talk about the growth in the 1990s and we will make important policy decisions in a bipartisan way for much of that time. and ultimately our goal has to be growth because it becomes a question of how do we cut our way to prosperity. there's no answer for any society. >> let me ask and be clear that

you're committed and the administration is committed to working with us this year to get tax and trade ideally done. >> that is correct. >> the second thing was in your comments that some people need to pay more their fair share in the taxes now for medium or small businesses when you add together it's almost 50%. ..

>> >> suggesting that while tax havens had 5% of the world's population that almost half of american's corporate earnings claim to have been heard offshore were from those five countries where in 2013 is suggested somewhere between 55 and $1,303,000,000,000 of profits surged in the united states were shifted abroad and over half of these profits were located in six tax savings isn't it true

that a substantial amount of these alleged offshore earnings were actually from operations that occurred here within the united states? >> it is hard to comment on individual circumstances but to take it up one level the issue of legal tax avoidance has led to the erosion of the tax base and it is enormous concern worldwide. it is wrong for countries to have a race to the bottom with zero tax rates to be a magnet for these types of activities it is also wrong to have a tax system with the highest a tory rate in the world to drive businesses to look for these havens we need to reform the broken system and other countries need to change their system to raise their standards. it is hard for us for

countries to do with they need to do if we don't do what we need to do. it will empower us to get other countries to do the right thing as well. >> if all elements are adopted and strong with any abuse provisions are included but i know that is considered onerous by some of those multinationals that need to pay the treasury than the lobbyists to have that they are that they don't have any responsibility from which they benefit so much. but it seems selling corporations to pay less than a nickel or a dime on a dollar of profits that were really earned in the united states is generous better than the nickel in 2004 all

metal higher than the $0.9 that was recommended last year but that should be the issue of looking at bill whole issue in all these corporations if they pay taxes a broad they are entitled to a credit for that. that has been hidden from taxes every where that is an example of corporate tax avoidance that we need to put a stop to and not reward >> i totally agree we need to make sure we end up with a toll charge that is set at a reasonable level. we propose 14% i know that is higher than others but i think the credit for taxes overseas brings effective rate down considerably. we propose a pullout opprobrious credit because it is so reduced so

40 percent of the taxes paid if a firm has a billion dollars of accumulated earnings paying 100 million then they would get a $40 million credit and would pay that 10 percent so even the 48th centuries the impact on most firms. >> thank you for being with us today. day believed the estate tax is double taxation? >> no. >> in april 2013 we had a thoughtful exchange on a comprehensive tax reform and at the time we went to work together on the individual side as well to make it simpler. we have universal agreement

it is just too complicated. i certainly want to raise concerns from constituents of the estate tax. it is obviously no secret we have fundamental disagreement on the estate tax i believe it is double taxation. and i actually prefer a higher a state's tax but while dealing with the estate tax is challenging it is nowhere near the administrative nightmare to remove the allowance on the stepped-up basis. sova in a family passing on to calculate capital games the face -- family faces

multiple challenges finding that the purchase value from multiple tracks purchased at different times to determine if it is sold prior to inheritance so such a proposal is the opposite of tax reform and only because compliance more difficult. has anyone looked at the compliance time and cost of this provision would be? >> i am happy to get back to with the estimates of compliance. but the design of the provision in our budget was to make it easier for taxpayers, not harder to comply. there are exemptions that are quite generous and 50 years to make the tax payments and we think for the vast majority which are

subject to a stock -- stock databases is simpler to answer. with real-estate we have a system you have to know the basis in real-estate. i don't know why it is more complicated but i am happy to follow up with you. >> that was our in a at a the complexity. >> have they studied the effects will let it have on the availability. >> we have looked at what it would mean as the very small fee with the total bases and

it is to be complementary with reforms to make our system safer. right now we have the system heavily weighted to leverage of exposure. it would make it more costly but not prohibitive and we think that will lead it to raise a for financial system. we also think looking at the context of overall of tax reform is a fair and good policy. >> talking about the extenders and the temporary extenders two years at the time is that accurate? >>. >> often not. >> but i state did say good

idea of a permanent basis would that be more intellectually honest to make them burgonet plan to permanently extend on a temporary basis? >> that is what we propose. with the tax policy in various ways for 35 for 40 years it is hard for those that have deadlines that past to make it hard for businesses to expect out to plan. that when mated a rational way. and that is the basis as part of the conversation. >> mr. secretary thank you for being here. i want to add my appreciation to you and the president for syndicating a budget that attempts to

focus on the middle-class. weld businesses across this great country are very important and do a great service with great products the truth is it is those consumers of the middle-class who are the job creators in this country if there is no middle class there is nobody to buy all the great things our businesses sell and manufacture. then it all goes out the door. it is important to refocus on the middle-class. gilmore better place is investment and infrastructure. so that means to investor critical infrastructure to keep everything going across the country. i have a couple of questions of with like to ask. one is on what has come to

my attention which is the cash rich split off and your smile means you know, what i am talking about? a cable to light with the purchase of alibaba of. mandate take the asset stock jewish stage for a line of business in cash to avoid any gain of appreciation. and that looks like that legal tax avoidance of the great big huge loophole. does that new legislation to close that door is that something that can be done administratively? >> i cannot comment on what a specific company may or may not do much to split off on component parts there is

an active business the beach party. but if there is a spinoff the firm would be liable for capital gains and i don't all of the top of my head if there's any administrative issue. >> that is something to look into to better understand a of how we close that loophole. also i agree with my friend from massachusetts had to give it any thought of the status with those 2015 applications it is important to recognize it has been responsible for a lot of areas with severe economic

downturn. with the close military bases added to positive economic growth. i would think the market would be a great place to go. >> i would have to go back to looking at it. >> with lasted, first out the proposal of the budget is a little disheartening. in which his theory disruptive in general but specifically we have a retroactive provision so if enacted it would go back

decades it was generated through tax policy on the books it not only small family businesses that they employ today but this has shut businesses down. if you were very well aware of. is there a reason for the retroactivity? for word i've understand by going back seems unfair and destructive. >> congressman there is a discussion of proper accounting standards for some time and that is part of tax reform. i am happy to look at what you are concerned about it

is not to cause undue burden >> thank you. >> mr. secretary taking for coming to you testify of the president's budget. i would like to draw your attention and to the proposal on page 53. >> eight don't have one in front of me. >> is where he proposes attacks of 529 college savings account when the president proposed to this tax two weeks ago i wish shot to see him targeted these very popular plants and relieved when he withdrew his proposal on tuesday but he changed course to late to remove it from the proposal than the next day the administration spokesman made a confusing statement that said he was

eliot was drawing it due to political pressure and he still stands behind the attacks as good policy. so could you please clarify to support the concept does he believe this is good policy and could he read -- revive this tax again? >> just to be clear the white house indicated clearly to be pushing for this provision there was obviously already in the budget. it was causing a lot of distraction on the tax issues to provide real opportunity for a middle-class families.

if there wasn't a solid policy reason to largely benefit more affluent people and how to make college education affordable is a basis. we're not pushing it he is not pushing it is not a key part of the plan it is not a huge dollar impact there should not be any confusion on the issues. >> so he still thinks it is good policy but he will lustral for political reasons. >> one can justify a policy grounds the don't go forward >> they keep for someone of a clarification. now have a bite to briefly discuss h.r. 529 that i introduced on a bipartisan basis last week.

i have been a champion of 529 plans since the was the state treasurer in kangaroos and this is the -- in kansas and this is making it more attractive to middle-class folks across the country to save for college education in the accounts -- enhancements would allow citizens to buy a computer in allows funds to be redeposited without penalty if the student was draws from school and takes out the administrative requirements so what is your take do you agree with these improvements and will the administration supports the bill? >> i am happy to look to the proposal and get back to you.

obviously with 529 we would look forward to make sure their work effectively as possible. i'm not as familiar with the details of the of the dissident proposal. >> and look forward to working with you. i yield back. >> [inaudible] proposed and mr. chairman your initiatives to keep with this committee open and on pace to have johnson

angeles forums were reared by other members of congress as the way to restore what we go individually is the great strength of this community to work across the aisle with one another. several issues were explored today in rapid order first with respect with infrastructure there are several letters sent last year with respect to make sure we have hearings on infrastructure and discussed the tax aspects of this as well. and i know that is that the core of putting people back to work. a whole week can't continue down the line may be that is the start of a discussion on infrastructure. also social security was brought up by mr. johnson.

there is a proposal that has a tax cut debt is paid for. i hope all members will consider the proposal to put this into the next century that is paid for. with the affordable care act the matter what comes on the floor tomorrow is long overdue recognize a proposal by the heritage foundation is adopted successfully by governor romney is something we can work together for the benefit of the american people. with respect to currency and trade the administration will hear concerns that were raised their. and lastly, i believe the question about dynamic scoring went to provide you with a few moments to expand upon your thoughts.

>> thank you mr. larson. the question of how we score legislation is technical and complicated. we have established practices that are meant to be as accurate as possible. and the risk that is known to be the most accurate and there is the shared concern to not paul whole and our budget to be wrong so asking if there is dynamic scoring with tax policy but if one goes further to make assumptions that drives the numbers in a way that turned out not to be correct we will be corrected it to after the bills are added up.

at a lot there to be any misunderstanding. we have always been open into alternative measures with the upside and the downside risk but to use those to make decisions that have consequences are different. >> he also makes the point on several different occasions and we have to make sure we're willing to apply that and maybe it is a very sound practice i am not an economist but what do we apply it to and the kkk and be applied equally in the last couple of weeks have spend painful with green bay but i to -- i didn't take it personal. [laughter] have this picture to provide

you. >> i cannot see it from here. describing. >> it is the picture of tom brady. >> objection. we shall not be included in the record. [laughter] >> time has expired. >> mr. secretary thank you for being here the federal deficit will expire march 15 do you know, what the debt limit will be when set to expire? >> i don't have an exact estimate right now. with two months of data away the challenge to fund the government to make decisions on the spending policies.

>> has you edgers staff been able to use these extraordinary measures? >> i cannot use that with clarity until we get through tax season and made no our cash balance. >> that will be a problem because march 15 is the deadline and taxis in his april 15. >> with all public estimates from the cbo is shows we have a period of time. i know think we have a crisis on march 15 but i cannot tell you exactly how long it goes. it is the outer limit not the initial period. >> can you get back to us with a rough estimate? >> we will stay in close touch we think it is important to have clarity.

>> following up on a letter to be cosigned by 17 members of the ways and means committee i'm still having trouble understanding why it was to regulate the non dash value insurance? >> can you update members that signed the letter of the deliberations? >> our goal this has been adopted is to make sure the transparency from the tax authorities to seek behavior to get accurate reporting

offshore accounts we believe those proposals we have made we're happy to follow-up on issues you have described. >> your in in your out part of the framework is the desire to make the corporate tax reform more competitive. you've laid out a benchmark but when i am back in my district of frustration is not just employers with that complexity is really individuals. after it came out last year it was as individual taxpayers we are excited at the prospect that they could