donation and in spanish. [speaking spanish] [laughter] . .

also an advisory to immediate quick wrapping stories, an exclusive story done by abc news head this morning. posted about an hour ago. for the question-and-answer we we will be using a handheld microphone. we alive on c-span tv. i will give you the mike. with that i would like to open the floor up.

>> i i am a journalist based in dc. i would like to ask what you learned from your campaign in 2012. obviously an active campaign but i'm wondering what you might have learned about politics, stuff that goes on in washington things that may surprise you and how it might impact your 2016 campaign. >> thank you. my run in 2012 came after a series of runs at the local and state level, and i have to say what was surprising was that there was really nothing surprising about politics and the kind of back fighting game has its place. what was surprising to me was already people are

people are in our community to rise up and fight for something different. that amazed me command we were only beginning to build a national infrastructure and i think that's what is really different this time round people had not forgotten the incredible need for a different voice, for a different choice. as we enter this exploratory time we're reaching out to communities to see if this is the right time to step up and work together. i'm hoping that it is. [applause] >> thank you. of course you are laying out the issues excellent.

i have a question about the united nations. i remember when the un was formed. we thought we had a place where something called justice and all that sort of thing. the un is mentioned less and less. we are against palestine joining the human. the un is not a recourse referenced. i i really want you to put it on your list of issues of why the un is a way a way to restore some kind of justice and legal determination.

i don't care what it is, go to the un. >> thank you, thank you, jennifer. thank you for your wonderful foundational work. i completely agree that instead of this shoot 1st foreign policy we have the policy and international law and human rights need to be at the forefront. the un has become a mixed bag. we have seen that in the climate proceedings where it has become a front for lobbyists and the climate lobbyists have become climate summits. we have work to do. we we need to get the big powerful countries out of

the business of suppressing democracy in the un. >> other questions? >> kelly campbell, green tv. green parties around the world have been very successful. in the majority of state legislatures. still another of the 9th or 10th state legislature governing. australia across the world to mikey's my key success has been a positive green, new deal pedestrian. the important important economic effect you can speak to tell us the positive solutions for green party new deal with the obesity epidemic killing americans.

>> what is good for the planet is good for the economy and our health which is why the green new deal is a win win, win a study out of stanford by mark jacobson about two years ago worked at the state of new york as a case study and basically found that going to 100 percent was going to pay for itself simply and health savings alone we take it for granted and assume these are god-given conditions, we all live with heart disease and respiratory disease and the other consequences. they are not supposed to be god-given conditions the strike is from birth on. the are not just diseases of aging.

your.is a good one but they're are so many benefits to greening our economy halting climate change, making oil obsolete and providing those jobs right now that are essential. they can make unemployment a thing of the past will put everyone to work command the good news is that conservation and efficiency efficiency, simply saving energy by weatherizing homes and businesses and schools all that pays for itself in about three years. so many savings kick in. when people ask how you we will pay for it essentially it pays for itself and we are paying through the teeth were not moving forward

right now in a a way that can also solve the climate crisis by a timely intervention. thank you. [applause] >> nice to see you again. seeking the green party nomination. it was done in portugal and creating safe spaces. it's a wonderful and deeply involved question, but we need to move from criminalizing the substances to treating it as a public health issue. that is to be our overarching approach. criminalizing people have addiction problems only makes them worse.

they are confronting joblessness and homelessness based on being former prisoners. so our system basically compounds the war on drugs and makes it worse. we can fix this now. it is an absolute crime that people are in jail for using drugs that are less harmful than nicotine and alcohol. the whole drug war is completely baseless soundless, immoral, racist and it needs to be transformed into a public health agenda and people who are currently serving time on account of using recreational substances should have their sentences commuted. [applause]

>> i. i am a public school teacher in philadelphia. i was pleased to here you mention education during your talk. can you talk more about what your vision of education would look like? when the education system that teaches the whole student. the meaning of education into high-stakes standardized testing is a betrayal of the mission of education developing the whole person, lifetime person, lifetime learning and developing our capacity for democracy. democracy fundamentally depends on education and on our ability to make informed

choices and inform ourselves we need strong public schools. we should not be privatizing our schools we need community-based schools that should not have to be privatized. parents and teachers and students on the role they can work harder, pass the tests and get cherry picked up. my other visionary sort of thought about the big vision of education is that kids need to come to school prepared to learn. if there coming malnourished or sick walking through communities the set by

violence, homeless and jobless and that is an education problem. [applause] >> we have time for two or three more questions. >> good morning. i would like to no what is the reform about? >> important question. there is a lot that needs to be done. we have to stop shoving people in the present

forcing people economically disadvantaged in that direction with people who don't have jobs turned to drugs. that should not be the case. they are not forced and the dangerous and risky professions in order to stay alive. we need to do away with the mandatory minimums throwing people in a jail. it needs to be about rehabilitation and not vengeance. we need to prepare people to move back into society. the term restorative justice is used that says a lot about what should be the vision of our present system not retribution and

revenge for preventing people from the start from being torn from their families and their communities going down pathways of violence and crime. thank you. [applause] >> good morning. it has been more than a 100 year struggle. the affordable care act actually further empowered the medical industrial complex in the way of us getting the type of assistance. do you have the courage to take on that powerful industrial complex and how do you think the people respond?

>> well, you no well what this is about and that none of us can do this alone. to my mind the imperative for this campaign is to bring the struggle which you and so many other physicians in everyday people are pushing forward about our right to health care. [applause] >> furthermore, we have a sick care system which allows all kinds of things to go on that make us sick. the sick. the vast majority of chronic illnesses are actually preventable and are inflicted on us by various social and nutritional and toxicological conditions we

have a wonderful crew to be fighting this battle. kudos to you and pnh be the poor people's economic rights campaign and many others in the audience and listening to have been a part of the struggle. polls continue to show this is what most americans want, want, and it is really for lack of a voice in the process and for the fear campaign that tells us we don't dare stand up for what is actually within arms reach for what we can achieve and will make our lives better to make us healthier and give us more secure economy which is within our reach. standing up for health as part of stanley and for economic and social out in the health of our democracy.

as we come together in the national political campaign it's a great way to build these coalitions if you look at what is happening in greece things only began to really change for the better in that social movement became a political movement and the political movement had a meteoric rise from 3 percent missing the same thing in spain in the uk the green party is also experiencing a really fast upsurge. in the us for better or for worse is not like things are going to change. the predators are at the

wheel and have no intention of giving it up. we have an exciting future they encourage everyone to go to the website. thank you so much. [applause] >> we do have two other people on the stack, as it were us senator candidate for the dc green party. they support what we will

you do to promote our goal nationally and internationally? >> and missed a couple of words. was that for statehood? >> washington dc is an important place. this was the seat of power and where so many battles are fought. i will be hear. i am in an exploratory campaign. if things go well my intent. to be here fighting the fight with the and to clarify that this is everyone's fight. it is a national disgrace that our capitol are capital is the colony of the two-party corporate state. yes. [applause] >> final question.

>> i would like to no what you we will be to bring young people that are disillusioned with the two-party system into the fold and to make them more welcome an understanding of democracy? >> thank you. you. that is the question of the hour and something we can only do together and is part of what we were doing in this exploratory phase; and people who want to see this happen want to see a future for your people who don't have jobs swap that if you don't have a climate future to look forward to and who are dealing with all the insecurities and our economy. this this is the time to mobilize. especially for young people on whose shoulders all of these burdens are hardest.

we need to have your people at the helm in leading this charge. my hope my hope is people get organized, stand up intimacy of the county have a campaign like we've never seen. [applause] >> thank you. [applause] the formal question-and-answer session is concluded. any of the activists assembled here in support of the exploratory committee, please post them directly. everyone else, thank you for coming.

[inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] >> on the next washington

journal executive editor talks about the coalition against isis and steps the us could take the would require congressional authorization. the rise in measles cases across the us and how some have pointed to the active of anti- vaccine movement. we will be joined by a board a board member of the national foundation for infectious diseases. it will take your phone calls and look for comments on facebook and twitter. washington journal live every day at 7:00 a.m. eastern c-span

this is an hour. i think we will begin. i am the director of congressional affairs for the cato institute. thank you for coming to hear the third annual libertarian state of the union. the president laid out plans fl final two years in office in the state of the union. it reminded me of looking for trouble, finding it everywhere

diagnosing it incorrectly and applying the wrong remedy. what does the agenda mean for liberty? how will it affect growth? what can policymakers do to address pressing issues and reducing to reduce the size and scope of the government. to discuss the current state of the union i have four cato policy experts. the director of financial regulations studies at the cato institute is here. we spent seven years on the committee staff on housing, banking and urban affairs and handled issues with banking and mortgages for ranking member richard shelby from alabama.

he built a career of proposals on financial and the mortgage market and how changes affect low income households. chris edwards the director of the policy at katiecato. he was a senior writer on the congressional joint economic committee, a manager with price waterhouse cooper and an economist. he has testified to the congress on financial issues and his writings have appeared in the "washington post" and washington journal and other papers. he is the author of downsizing the government. he was a member of the fiscal future commission of the national academy of science. julian sanchez studies the civil

liberties with a focus on national security and intelligence surveyillancesurveillance. he covered surveillance before this covering policies. he wrote for the democracy in america blog and an editor for reason magazine where he is remaining contributing editor. he is a founding editor of the blog just security. he studied philosophy and political science at new york state university. and the director of herbet center where he coordinated international trade and policy. and focused on u.s. china trade agreements, globalization, u.s.

manufacturing and trade remedies like anti-dumping regime and wrote a book about the topic even. he has testified before variety congressional communities and he is a frequent guest on numerous tv programs. his articles have been in the wal street junior, los angeles times, usta today, chicago tribune, forbes and national review. these are our scholars. each speaks in term for 7-10 minutes or so. and after which we will open it up for q&a. let's open it up for mark now. [applause] >> thank you. thank you, peter. it is an honor to be with my colleagues today. and i thank the audience for showing up. it must be tempting to be here on what is a lovely 17 degree day.

at least it is warm in here. of course the state of the union deals with where we are as a country. and i want to start with where we are as an economy. of course politicians are often made or broken by the state of the economy and of course the economy directly impacts all of us whether it is weak or strong and/or own job prospects and the job prospects of our friends and neighbors. we are entering the six year of recovery. there are bright spot but it is fair to see the economy disappoints in a lot of ways. consumer spending second half of 2014 and consumer confidence picked up but the labor mark is still concerning. unemployment rates dropped to below 6% unfortunately a considerable percentage of this

decline was workers leaving the employment force. labor participation rates have been falling since 2006. while the january numbers marked a small uptick it was only large enough to offset for the

>> that impacts employment and construction related instries.to our economy before i move on the policy we are slowly headed in the right direction. i would i would certainly say i don't think we're anywhere near the time taking a victory lap on the economy. there is an extent to which it

is easy to say job weakness could be because of lack of demand. there could be more demand also but one of the more important policies and economic questions is there a disconnect between the labor markets and overall spending. gdp and consumer spending continued to increase for years even while the labor market was flat. this only changed in recent years. and i think this topic is continuing to be debated by my view is expansion of mean tested programs created strong disincentives to work or at least at prevailing wages. i think the recovery of the housing problem and the con traction of the safety network is one of the major forces behind the market recovery. home ownerships are declining.

it isn't far from where it was in 1960 in fact. a lot of areas i work on in mortgage finance and one would think since we are back to the home ownership rates we have not seen in decades we would think to rethink the policies. but i don't think it is in the cards. the president announced a lowering of prepmiums to bring in regular borrowers. and fannie may decided it was okay to take on more and the taxpayer are taxpayers are on the hook for attempt they are taking. i figure this effort will end in tears as well. the reduction in fhh premiums

are intended to help the rate, but i think the buyers are lower credit will suggest we will see a reduction quality. two thirds of hha are sub-prime bar barrowers so it is hard to picture it worse. it will mean we will have further losses by bringing lower quality buyers and also worth remembering fhh has a particular case of this but i will talk about it not being the only program on the budget where the cost are pushed out in further years and have estimated credit subsidies. to show you concern, the estimates where fhh underestimated the cost of the program by over $70 billion so

not collected in the cost of the program and it has to be made up by the taxpayer. we have seen similar cost a little less, with the student loan programs. i would say be leery of government loan programs that offer lots of profits because more often than not it is an illusion. let me talk about the shadow budget. we will talk more about what is on budget later but i want to talk about what is not on the budget but comes on to the budget and that is the sometimes explicit and sometimes inplicit subsidies in the financial systems. the shadow liability is $3 trillion with the housing being at $2 triianllion. these programs end up costing

significantly more than every promised. and while those are on budget they are not accurately reflected. worse of concern me is the implied implied implied guaranteed. you will not find this reflected in the budget. it is also worth saying and there is about $2 trillion in private pension funds, that are at risk and the taxpayer maybe asked to pick up as well. lots of figures and liabilities. i would go as far to say of equal concern is giving the actions of the widespread bail out during the crisis and the structure of the dodd-frank act leads the taxpayer responsible ultimately. the question is whether the other six trillion in uninsured

bank liability and if the taxpayer is on the hook for those. that says nothing when you guarantee risk you make the cost of something lower and people consume more of it and the same is true about the risk in the financial systems. most of the guarantees they encourage excessive risk taking in the marketplace. we need to be concerned about that. to give you a sense of unfunded liabilities, well i will start with one of my former colleagues at cato estimated the unfunded liabilities are about $70 trillion of promises we made but can't keep. the federal reserve bank of richmond estimated the shadow liabilities in the financial system are as much as $108 trillion. that is seven times the gdp.

we don't have the ability to pay that. and we will not. so i would say by difference however, some of the financial liabilities have collateral behind them. to summarize the state of what i call our financial fiscal union it is at best shaky. the health of the banks and housing markets have been driven by a federal reserve liquidity. it has been good for banks about not the over all economy. if and when the feds decide to lower rates, later this year i can there is a significant chance houses prices will flatten and maybe decline. i remember people chanted on the hill that housing prices never go down. now you have heard housing prices do decline and when they do nsa nasty things happen.

incomes are far short what one would need to afford a house. it might be a needed adjustment but it will be painful. to backdoor system helped build bank balance sheets and higher rates may increase lending but to the papered over problems i worry another financial crisis may be well in the works. to sustain the current recovery i think we need to regulate the financial system particularly in the area of mortgage finance. we are six years past the financial crisis but my opinion is the fundamental drivers of the crisis remain to be

addressed. with that happy note i will turn it over to chris edwards who i know will be even more cheerful. [applause] >> all right. thank you very much mark. i am chris edwards. director of tax policy at the cato institute and editor of downsizing.org the website that tells you how to cut the federal budget. president obama released the 2015 budget and i will talk about the tax and spending. the language is triumphant as if the president has solved the problems. it is a poke in the eye to american businesses and republicans who won a landslide

election last fall. this wasn't a compromised budget on taxes and spending policy. under president obama, spending and debt has soared with federal debt soaring. it is the highest it has ever in our history and the president's budget seems untroubled by that and keeps the debt at high levels. his deficits are half a trillion a year for the next decade and the administration seems untroubled by that. but that is $500 trillion of new cost every year that will be passed on to younger americans. the administration in its budget proposed no plan to ward off fiscal doom from rising cost in social security medicare and medicaid which is growing as the share of the economy. the trust fund for social

security disability insurance runs dry next year and the administration papers over that problem. the congressional budget office projects federal spending will grow to 30% of the economy by 2035. future americans will be increasingly less free as the government gobbles a greater share of everything produced in the nation. but that sort of scary forecast by the cbo and omb has similar long-term projections. they are optimistic for several reasons actually. first, president obama for example in his budget shows discreationary spending meaning defense and non-defense dropping over the next decade. i would be in favor of that but the president has no plan to make it happen. no major cuts and terminations. so his showing under

discretionary spending is trying to cover up the deficit problem. the second problem is the united states might see unforeseeable wars in the future. hopefully we will avoid major wars but the problem is if we do get in a major war we will start from a high level of debt. president bush started his war when we had a low level of date. so if we have major wars in the future it could be catastrophic fiscally as we go higher and higher into debt. a third issue is that in these long-term projections that look scary enough they don't include recession. we may well have major recessions in the future that will blow huge holes in the deficit/budget. it would be prudent pay down the debt but unfortunately president obama's budget does the

opposite. in some of the official projections they are artificially rosy and i think they should be scouring the budget and look for programs to cut and terminate. now would be a great time to cut federal spending and i mentioned cato's website downsizinggovernment.org is a great place to go. education, housing and transportations -- federal subsidies for state governments cost over $600 billion a year and they are ripe for cutting. a good opportunity comes in may when the federal highway trust fund runs out of money. there is a gap between spending and gap tax revenue. congress should cut spending down to the level of gas tax revenue to solve the problem and allow the state governments to fill the gap however they want.

president obama's budget goes into the opposite direction, raising taxes to increase highway and transit spending and that is the wrong way to go i think. there is no advantage in increasing federal intervention in the nation's highway system. state governments can raise their own money to spend on their own highways any time they want. they don't have to wait for the federal government. switching over to president obama's tax proposal, there are two problems with them. they would increase tax complexity and very much anti-growth. it is a curious thing obama's budget said repeatedly that his tax proposal would simplify the tax code. the president said in speeches and in the state of the union he wants to simplify the tax code. but it would make it more complex. he would tax capital gains a

new bank tax, a so-called war on buffet tax on high earners and proposes complicated tax credits. there is a $500 credit for two-earner family and a variety of business give away credits like a new manufacturing tax credit. these would complexify the tax code. they are also anti-growth. he would increase the federal capital gains tax rate from 24 to 28 percent. if you add the taxes on top the rate would be 32%. if you look around the world at our trading partners the average capital gains tax rate is 18%. we would be at 32%. and other countries at 18%. why do other countries have low capital gains tax rates? because they know that they are

good for foreign investment and start up and growth in companies. president obama's increase is anti-silicone valley. president obama would impose tax on capital gains but the problem is we have a 40% estate tax that hits at death. if you look around the world, countries either have a state or inheritance tax or they tax capital gains at death. they generally don't want to do both but obama does and that will induce high earners to save and invest less and that will hurt the economy and all of us. president obama would increase corporate taxes. the united states has the highest rate and with state taxes on top the u.s. corporate tax rate is 40%. the average global tax rate is

24%. the second problem with the tax system is we tax corporations on a worldwide bases. the united states claims the right to tax u.s. companies on their operations throughout the entire planet which when you think about it is a bizarre way to set-up a tax code. every other country has a system where tay don't tax the foreign operations of their multi national companies generally. ...

businesses so unfortunately we're going to have to wait for the next president to you real texture on. [applause] >> thank you all for being here. in the other state of the union speech was heartened to here what others have moved beyond the debate about intelligence issues. not. enthusiasm wayned a little bit wishing a report about things that they have done internally to have additional safeguards on those programs and that report that was release this had week. ihi mostly underscores hey have fallen in reform efforts not just from several inpanels have recommend but from what the

president himself has committed to over a year ago. i this i at that what we have seen in another report is by far not enough both from the civil liberties perspective because we have constructed an unpresidented and sprawling architect turf data collection on the premise that effective intelligence now requires extraordinarily broad and some cases entirely indiscriminating collection of data by guilty and the innocent alike and the architecture that because of its breath will in a time of crisis or at the behest of people with poor moiftz i think would be there with the flip of a switch turned from the legitimate toil legitimate purposes with the way that we have seen in the history repeatedly over decades and intelligence services with inadequate over site and they lacked anything like the capabilities of the modern

and fbi this is inadequate for economic reasons. we have seen increasingly distrust in markets of american technology companies and we have seen projection that's the american computing sector alone will stand to left side on the order of $180 billion over the period of three or four years because the declining trust. especially in the enterprise sector. very seen the declines in for example global orders for cisco's routers and following reports of now it was installing malware and not just for particular individuals but corporate level so both to restore the public confidence and those to protect civil liberties and global market confidence in the trust worthy nests american technology firms. we will need to do quite a bit more. so of course at the end of the last session we saw the main surveillance reform vehicle the usa freedom act stall in the senate. and i guess the most

prominent component of that was reforms to 215 of the usa patriot act as well as related authorities to get telecommunications data, and this is famously the basis for the bulk telephany revealed. the president a year ago commit today end that in the current form and the bulk collection by the government to let the date a that will continue. it was recently renewed yet again several independent bodies the privacy and the civil liberties oversight board as well as the president hand picked by the review group has both said that this is the program of extremely limited effectiveness. that could safely be ended and should be ended. the privacy and civil oversight board weapon into detail to examine claims about the he have cassy of the program. and the success stories and terror plots that from foiled and and went through

one an at a time. 11 of 12 of the cases in fact the program contrary to claims in the behalf had provided no unique intelligence use to fbi or nsa. and that the 12th case involving material support meaning monday tearing donations have been you know. in fact the first way that they found useful information. but that it was not necessary targeted methods would have sufficed. so we have had the agreement of the intelligence community that with the reform a poach that was out lined in the legislation they will duplicate the essential functionalist the program. though it is limited effectiveness. and that we have seen the general council for the director of national intelligence in a conference held in cato and again this week of the brookings institute saying that the intelligence community was comfortable with the reform that is was something that they preserved capabilities

and required and wish it had would pass and yet, we here confusing invokation of the attacks on charlie hebdo and the rise of isis. invoked as reasonables that again despite what the intelligence community says we will need to preserve the thethe domestic call records program there. is such a thing as become being more catholic than the pope. if the intelligence community and every expert body says that these are reforms that we can untake to improve privacy and civil liberties protections without ham percentage the intelligence mission, then there should not be there should not be resistance that we see. similarly, we have not seen any significant reforms to collection under section 7026 the a menment act this. is an authority essentially allowing general warrants

that permit nsa analysts to select foreign based targets and communications with americans. we know that there were 90,000 such targets and one quasi warren task and many, many many american communications were swept up in the process. this is particularly concerning given that we know that the fbi is authorized to search the databases for the fires of americans and people would not be legal to collect on directly they are sit sdenlz in the united states without a particular judicial warrant can then be pull out of the enormous pool of global communication that's they have collected from the enormous number of directors stressed and not necessarily bad guys. because nsa will not just look at bad guys but people that are saying things that

are interesting and indeed the fbi can do this and can search the database for the american communications even when they are conducting their assessments and meaning not the full predicated investigation based on a type of evidence or of wrongdoing and just to satisfy the themselves that there is not a wrongdoing being committed. in is also concerning because of the practice that we have learned about called about collection that is to say that a target is selected and account and phone numbers would be selected specifically concerning and e-mail addresses and online accounts will be tasks for the collection but the collection does not just encompass the communications to or from that address. rather all of the international communications will stand contents of the communication scanned. and communications neither to or from the target and perhaps to or from americans are collected if they can contain a reference to a

target fire. the resent report is proposed a number of additional internal approvals for the use of some of knees techniques but as justice scalia said. in court an opinions our founders did not fight and die for stricter perot comes and by the foreign intelligence surveillance court's standard in fact the techniques would appear to be unconstitutional the foreign intelligence has articulated the exemption from the warrant requirement of electronic searches and suggests that when the search is conducted both or a foreign intelligence purpose or when it targets someone believes that the probable cause level an asian to a foreign power there. is a foreign intelligence special needs exemption from the usual requirement to get a particular judicial

warrant and yet of course that is not a requirement of this type of collection it. will require the collection target foreign persons and it does not have that additional requirement so you will have communications of u.s. person that's are protected by the fourth a menment and collected under the condition that's do not satisfy the own criteria for a foreign intelligence exception that should be a problem. i think. and we have also heard calls increasingly as we are hearing dire warnings about the state of american cyber security to restrict incription technology. both in temps of communication services platforms that are used by the people that provide incription and device incription on things like smart phones. these are extraordinarily problematic i think little evidence was presented that in fact this is proving, and in the obstacle to anything with investigation and information in the enormous university of data that we

swim in cannot be obtained in alternative ways. problematic as a term of prince pl and presumption that the government can require you to store your own information in a format design today fascilitate their access though committed of no crime or had to write a diary in english to make it easier if the government wanted to read it. and from a security perspective. security experts are near unanimous. it is difficult to kwaet any kind of communications technology or system that is both secure against unauthorized assault and will work against its own use for provide access to only those entities that you wish to grant access to. problematic from an economic perspective and trying to sell the devices and technology that's are announced to vf a deliberate architecture for security breach built into them. as adult proposition. and slightly more resultly this is problematic.

it will entail maybe nonobvious design constraints. that is to say that when you mandate either a device manufacturer or communications provider retain capability to provide encrypted communications. you will actually bake into the mandate a bunch of other design constraints that again may not be obvious to the nontechnical but for instance if you push people from distributing the pure to pure communications and those hard to intercept so to centralized architectures if there are good technical reasons to not want to implement that architecture. finally i this i that the unifying problem that brings all of these thing together is the extraordinary life of transe parent see. and the surveillance programs that i talk about the were implemented and subjected to secret rulings by the foreign intelligence surveillance. and secret statutes by government lawyers and often

wildly differing from what any ordinary me. public would unassistant law to be authorizing and indeed what many legislators understood themselves to have an authorized and any reform to be credible i think with the public in any of these areas is going to need to be bundled we are form reinquiring some levels of transparency and major decisions from court in the democracy we believe that this is no such thing as secret law that a lopez body of secret common law we may never know as much about the state the union as the fbi and the nsa do. but at the releast should know what the state of the law is. thank you. [applause] all right everybody thank you for sticking around and

important none the less. u.s. trade policy closer to the libertarian model and kauai deal and every other policy. that is not just because the government is not encroach energy trade policy or because it is particularly libertarian but the government will encroach more and other spheres of public lives. so we are still a long way from the libertarian ideal in trade policy. that idea would be free trade. you know. free flow of goods and services across the border with no tariffs and discriminating limitations and free flow of investment and in and out of the country. and into any industry. and any and all initial stories. the free flow of labor. in and out of the country. so the moral case. i think for the free trade is compelling people are entitle today the fruits of their labor and entitle

today dispose of property as they wish and the government interfering in the decisions trying to tilt the balance by domestic producers so products will be cheaper and taxing foreign producers so that products are motion, pensive that is where the unfairness is. so it messes up incentives. it will compel people to make political decisions instead of economic ones and instead of investing in rnd or production facilities to make a better mousetrap companies are more inclined to invest in politics. and on street. even companies that do not want anything to do with washington competitors are here asking for things and demanding thing so it will create this problem and, markets. producers do not know what to produce. and will satisfy the consumer demand. so i will get off of that

high horse and the mission trade center at cato our goal is to educate the public and policymakers about the benefits of free trade and the cost of protection not to free trade. if that was the goal i would have lost my job long ago. so where do we stan with respect to that goal of illuminating people about the benefits of free trade? . >> well, let's ask this question. is the public more aware of the benefits of trade or cost of protections now than five years ago or twenty yearsing a? . >> evidence is mixed if you look at the poll results you see the american public that is grudgingly accenting of idea that the united states will need to be engaged in the global economy and will you also see reluctance and skepticism about the impact of trade on jobs and in particular. let's look at the political dialogue.

well, it is still fairly partisan republicans tend to favor trade liberalization. freer trade. representing you know business interests. this is not necessarily free trade but it is pro trade. pro export democrats will tend to be guided by their labor and environmental and anti-corporate interests and opposed to the trade. but interestingly i would say that more so than any other in the 14 years at cato. prospects for the trade liberalization right now are greater than any other time in the span so that is fairly ironic considering the president that is presiding over this state of affairs. as a president that is really never made a case for the trade liberalization or made an affirmative case in the state of the union address a few weeksing a he made the defensive case. and you know. we will have to engage in the trade deals because if not they will be left behind china will write the rules. so this is what we will have to do rather than something that is beneficial that we should do and to me that is

the wrong way to pitch trades and i will digress for a minute. and give you 150 years of trade policy history in that one minute democrats were not always the party of protectionism and republicans of free trade. it was the other way around from civil war to 1934. democrats were the party of free trade. and the republicans part eve protection. and of the mother of the trust. and big business interests did not want competition. they liked it. and tariffs. between 1934. and approximately the nafta vote early 90s the trade was pushed on the bipartisan basis. through a bipartisan concensus and the trade was a good thing after naft a democrats started to really peel off an opposing trade. and when gw bush was president, he um it was at the beginning at least. it seemed to be unlikely that the trade an again a would go anywhere. there was a lot of internal combustion going on here in

the united states. and after 9/11, there was a new sort of impetus for the globalization to show solidarity. and perhaps a majority. republicans will control congress with the senate and the house and in seeking that they did not want to incorporate the republicans in congress did not want to incorporate the demands of the democrats work which were those trade agreements. so the trade promotion authority passed on the partisan basis and all of the subsequent trade agreements in the earlier 2000s were fairly partisan. and the vote was part sand whether obama became sorry when the democrats took control of congress in 2007, there were three pending bilateral agreement negotiated in the bush administration with colombia, and panama and south korea taken off track by nancy pelosi. it was not given a fast track treatment that climate

prevailed. so when president obama assumed the office. he basically capitulate today the office and did not attempt to push the trade agreements at all. so for several years the agreements would lay and 2010. when the republicans took back the house, starting in 2011 decided okay. i will help to get the agreements through and he d he worked with congress to get the agreements done. ' noujsed that we are ramping up the effort in the transe pacific partnership negotiations and that his negotiation of the deal but still never made a case for why we should be doing this. and then we had the 2012 election. his rhetoric again was defensive on the trade. and so last year finally trade promotional authority legislation was tro introduced on a bipartisan basis and harry reid said do not bring it to the floor. we would not vote on that. and they didn't. so right now, we are at the stage where we are trying to

negotiate or get trade promotion authority for the president and there is language to be run write now. and the senate house ways and mains and by the enltz of the month. something will come out i generally think that under the regularity of authority into foreign treaty and many course trade promotion authority is an expedient and compact you must do x, y, z abc. and bring back that agreement for the agreement will vote yea or nay. no fill busters. and described by the opponents though as sort of the executive power grad. and it is giving away responsibility. for that is not the case. so i this i that it would be good for trade promotion authority. otherwise will you not get an a greemth they will not

put the best offers on the table unless the deal that they negotiate will be able to withstand congressional scrutiny. nerndz picked apart by congress. so there is a lot of opposition to the trade agenda itself. and transpacific partnership negotiation and also the transatlantic negotiation the tichlt i am not sure that i will support that tpp and i think that i am incline today do that it will make us more economically free. and the trade agreements have a lot of protectionism baked into them. they are not free trade they have the initial stories that are carved out from liberalization and tariffs auto industry wants a 2. 5% on automobiles and they want to phase that out over 25 years and a tenth of the a percent a year. and rigid property

provisions and monopoly. do we have what we need under u.s. law? . >> probably not, some agreement are pushing for investor rights for foreign investores to be able to go outside of the u.s. judicial system. if there has been an ex-prop relation or if they were treated unfairly. and if asset values are declined likewise the u.s. companies will have access to the third party tribunal system as well. i do not think that it is necessary. i will evaluate them whether or not they are liberalizing. and i this i that those that want to nip and trade in the bud by denying the fast tractor the trade practice promotion authority. had it wrong congress can vote no. if they do not like it. and the issue that i want to bring to your attention is the export and import bank. that was suppose to lapse

last year in september. reauthorized temporarily through june 30th. and export and import bank. and credit agency that age willedly finances the export sales private sector banks will be unwilling to touch so if that is the case. if that is what it does they are putting taxpayer resources at risk. and defenders of the bank say that they are making money for the treasury. there have is no risk. it is like driving home drunk and rationalizing the next day. i made it home safely. i can do this again tomorrow there are taxpayer dollars that are at risk. and also this is not been a big americans love ports, good and bad and scoreboard. we are losing the trade. vet deficit. and everybody is cheating. we love exports, right? into that is the wrong way to think of trade. but people think that

exports are so good we under write exports we are gch to reauthorize the charter. this are costs. costs to other companies in the same industry. they are put at a disadvantage and the cost to down stream initial stories. the best example is delta. raising the roof about subsidies to boeing. and xm's primary customer is it boeing. when boeing customers india and ethiopia get subsidies from american. they are is up subsidizing competition with u.s. carriers there. are $ 50 billion subsidies that went out over the last self not yeahers in manufacturing and the been fisheries has a drown stream customer. and the customers are put at

a disadvantage the way that delta is. so, i am hoping that the bank is not reauthorized and that it is through june 30th that is something had a we are standing for. we wrote eight about that. in the paper out there. that is to 114th congress i will stop there. thank you. [applause] we have time for q&a. that is only one rule that is to express your question in the form avenue question otherwise we are ready to go. i am a moderate. i have a question to follow up on the import and export. i talked to progressive. they believe that they want the bank to be reauthorized because of the green technology. and then i have talked to the hawks. me want it to be reauthorized. they think that the republicans will change it so weapons can be included

as one of their thing that they will ensure. and if that happens we will be selling a lot more weapons and people. the dod tell me they do not want that there are vets going to afghanistan with one limb because they need people. we do not have enough for the va to take care of the people that we need to take care of. so my question is your statement about the import and export made me happy somebody just says that other companies are hurting by doing this. so the issue that i have is how did it get explained by the general public so it is clear. i don't think that congress really gets it excellent question. i wrote a paper about the down stream costs a few months ago. distributed up here. and i was told that people had a hard time understanding so we will revitalize that and make it more successful.

what i have found to be the most interesting twist in the xm debate is the support that xm's reauthorization is getting from progressive. they have shouted about corporate welfare. and supporting it the and only reason to imagine they are support that can is the proopponents of getting rid of the bank we must be against it so i think that is motivating a lot of support for reauthorization among progressives. thank you. in the back? my name is i have a question about. we already know reauthorization. do you think that another cries sister possible. can you identify that in an initial indicator that maybe we are not totally out of this is this for mark? . >> sure i am reminded about

a give area number gave a date. never give both. that would i say. i am absolutely. 99.9% sure we have another financial crisis some day boy i wish i knew when that would be. i can short it and mix the money. i do not know what it will be and sectors of the economy. i am worried that will roll back. as a general rule of thumb and when have you the long stretches of time with the real post inflation is negative that is you're essentially paying people to take money. i am certain that you pay the vast parts of the public to take money. somebody will do something dumb with that. so we have had six years where the fed has run a negative real interest rate policy. that to me is distorted property markets and distorted the equity market and the bond market so when

we see that on unravel this. is the question of or you know when? i said for instance that the market i thought would be 2004. i was off a year and a half again can't say when i think it will be, but i think within the next five years we are going to start to see property markets equity markets level off and go down in some areas there are still positives. i think that the banks are better capitalized than they were and the amount of rick in the mortgage market is big not as bad as it was. so again there are other areas and i don't think that this sovereign debt crisis of europe is anywhere being solved so this is a big over hang so i do not think that we have dealt with the fundamentals and that i will say that you rarely get a financial crisis without a sort of expansion of credit. and he would have seen that in this case.

whether the company has made better decisions and it remains to be seen yeah i would add to that if recessions happen. economists have not figured them out whether they are called business psycheles and whatever you want to call them. they are complicate and economists simply cannot foresee when they will happen. if you go back to january 2008, that is whether they introduced their budget prodesk projection they did not see the presession coming that can had started in december 2007 in january 2008. they saw arosy future of actually rising growth. and 2 to 3%. economists have no idea oh you to projt fiekt economic growth we do not totally understand how the economy will work so we will have and a recession. i don't know how it will be caused by. or if it will be caused by central bank or changes of

energy markets or whatever but to me the up shot is that we ought to be prudent with the federal budget. and get deficits and debt down right now as we have the chance and the economy is growing right now. now is the good time to start making some of the reforms we need to make again, what if we get into the deep recession or have and a major costly war it. will put the country into a terrible situation, we will be starting off from a very high level of debt so we ought to be prudent. and i do not think to add on either side of the aisle in washington. this is direct today mark clab are. and anybody else if they have anything to add can. more than welcome to add. but wondering about the talk about the continue contingent liabilities that the u.s. government has and deficit for the year did not seem to care for a lot of that. of the reason that's the

federal government saemz to have had markings of the subprime bauer ower and the reason why the they can continue to do this is that people are lending them money. based on the psychology and investor class thinks that government money. and that will be fine so. that they can lend them money. it strikes me as a weak psyche goo. i know that the other competitive kurnls sees are as bad shape at the dollar so. the question is do you envision any situation where the investor class will stop, stop lending money to the u.s. government in low interest rates? i think that there are fundamentals and the point that you raise about this is valid. it concerns me. i think that we have learn this had repeatedly. the psychology of the situation can change quite quickly. and all of a suddenly. great confidence in what we know is despite that default

is at this time. maybe they won't. and again. that is only one example. we certainly are in a situation where some of much of the financial decision here is built on things like fannie, and freddy. treasury debt. and if there is a problem in the sector the financial system itself will create. so i this that i there is a deep concern there. and i don't think that we have addressed it in any way. the attraction of the off budget cheat liabilities are so much easier for politicianes to save money that way. it never shows up on the budget. you will make promises that you do not have to pay for of course many of the rules for instance. accounting rules and many programs that i mentioned as i talked about the fha and discussion. premiums do not cover administrative costs and salaries for 3,000 employees will not reflect in the premiums charged so i guess that i would end with saying that the problem is that the government engages in a lot of what i would call enron

style accounting and it hides liability from the balance sheet, whether they come back to the balance sheet like it did for enron and citibank, this is not pretty we have time for one more quick question. any hope for the freer flow of labor from this? i did not hear about immigration from you guys. what i would hope to see movement on in the next couple of years? do i think that prospects are good? . >> not really. you know i refer to the work of cato who has written about this. the republicans are not that with willing to embrace the idea so it is something that we will need to you know. continue to push for.

maybe i will enon a more optimistic note. directly with work i do think that it will turn and many republicans will start to see that even from a pure political calculus that being an immigrant does not necessarily work. so again. i am not optimistic by the run i this i that the fact that most of us will recognize that our parents or grand parent contribute today this country is a message that resonates with most people so. i will enby saying that the could not mist. i do think that part of the reflects the labor market at any one time. labor mark let get more secure in jobs they will be more concern about the competition for their jobs. there you have it [applause] on the table on your way out there. is a a priorities for 114th

congress. essays from anybody on the panel. and i encouraging you to take one on the way out i encouraging you to take one. appreciate it. >> >> the papers are the flagship collection is that we have here.

he made in his life to help local and young mexican-americans learn to be more sickly active to get the benefits that they have coming to them as veterans which was sometimes very difficult for them to obtain. misrepresents the case that is an incident from the g.i. forum. the private serve united states during world war ii his widow a range to have his funeral conducted by the only funeral town -- home in his town. that was willing to conduct the funeral but not allowing his body to remain in the funeral home. for fear of offending the white citizens.

and conducting a letter-writing campaign in bin he states his belief is wrong for a fallen soldier to be discriminated against in to be buried in arlington national ceremony and that is where he was laid to rest.

. [applause] [applause]

[applause] >> members of the legislature, i present to you governor of the state of arizona. [cheers and applause] >> speaker, house leader leader, the leaders chief justice, the members said the judiciary committee and

legislature, a fake you all very much and good afternoon [applause]

naturally i hope it will be returned to that we find the best achievements are shared achievements. one week into the job i will not press the case the state of the state is any better off than it was last monday. [laughter] but i can tell you this for sure, if you and i can see our way clear to those shared achievements the people of arizona will do the rest and the state of our state will be confident confident, a strong and on the rise. [applause]

but we cannot do it with fiscal responsibility. win businesses take stock of how they're doing the answer has to do with the states of their finances. it works the same for government. started with a number 1 billion that is the difference between spending and revenue if we were to do nothing about it the next two years. the i am of field school of economics with the strikes me as a problem. i am not persuaded by appeals to raise taxes so we can spend more. [cheers and applause] look at it this way if the

problem is spending more than we have the solution cannot be even more spending. instead of demanding more revenue from the people i suggest we demand more fiscal responsibility from our government. [cheers and applause] so with all the care and debate with as little delay as possible let's put the budget in balance a and keep it there. [applause] this friday i will deliver my budget on flashlights to every member of this legislature. it's my best effort to deal with a tough situation.

just as i promised in last year's election we give a thorough look to current state expenditures to review some items we ask questions that have not been asked in a while. mike white is the states of arizona need an office and a paid lobbyist in washington d.c.? the user is we don't. [applause] so that office and all expenses will be gone and there will be one less lobbyist in washington. [applause] but we did not stop there. to institute a hiring freeze with protections for vital areas like public safety and

child safety. however when it comes to bureaucracy we're cutting back. the government cannot take on any new expenses when we cannot afford the ones that we already have. [applause] the budget does what they are supposed to do, prioritize vital commitments that arizonans value the most public safety , just as coming classrooms and eight to the needy and vulnerable. doesn't just give the appearance of spending discipline but offers the reality with decisions that a timely, real and permanent.

and did to that end i propose this. our state needs in a biased inspector general where corruption exists to shine a light on its. to be equipped with of bad jan subpoena power to ask the tough questions and and be a watchdog for the taxpayers. i want to work with you, the legislature to make this happen this session. [applause] with a tight budget we have all heard the calls the past few weeks to just go ahead and raise taxes now that we're all safely in office. in this case says the argument goes it would be relatively easy because all we have to do is cancel all

or some tax reforms taking effect. passed the previous legislature into circumstances have changed so let's just renig on our commitment. a way you look at it kiev selling is the wrong way to go. [applause] there were designed to put more life in our economy economy, business people the ones we count on to create jobs have been making plans around them. to build extent would dash expand if we change our plan they will change there is it is a high price to pay to go back corner word so not all in our watch.

[applause] tax rates that our predictable and reasonable hit every year taxpayers are faced with this thread of a tax increase because we don't tie income tax to inflation. the result is the automatic tax increase. end this by permanently index our income tax to inflation. this is an issue of fairness and we all better so let's get it done this session. [applause] in all that we do at this capital think big a and remember this. the business at hand is not to expand arizonas government but expand arizonas economy.

[applause] by some measures our economy is growing but not nearly at levels we can reach and not just the overall importance -- performance when growth and opportunity that reaches everyone. i signed an order with the moratorium on new regulations in the executive branch. it was a good beginning but only a beginning there is also the matter of many state regulations already in place for reasons nobody remembers. our small businesses have to deal with all the rules all the time. just because they're on the books in every has bothered to change them. i am instructing the directors to have a top to bottom review then sent me a

list of all the ones in the can do without. it is likely to be a long list. and wherever we find any regulation that is outdated, mayor rational rational, unfair or destructive to free and honest enterprises in arizona that regulation will be gone. [applause] agency directors will also be reducing time frames for a permit in the license. we need to operate at the speed of business. we have a regulatory review council that is staffed with obvious? he was advocating for the small business person?

the startup for the hour entreprenuers who cannot afford an attorney to navigate the endless maze of bureaucracy? pass a bill requiring a business owner and i will sign it. [applause] you'll have my full attention when you hand the any bill with a purpose to advance free enterprise to spread opportunity. when that is the a there is always more to do. frankly i am not impressed when i read arizona is the best plays for america to find work or do business. with the competition our goal is not to be washed summer retreat in california and texas.

our goal in arizona is to be the best place in america to work and do business. [applause] that same thing should apply to education. in arizona a public schools, we can do better. a snapshot of public education came in a survey a few years ago. it may shed -- mr. basic knowledge where it should be assumed. an elementary civics test along the lines for every new citizen and a hint when 96 percent you know,

something is missing. justice o'connor has called this the quiet crisis in education and. president reagan told us if we forget what we did, we will not know who we are. and also remarking every child in this country should be instructed in the principles of freedom. [applause] but to appreciate this wisdom of and it helps to know who justice o'connor and president reagan and john adams of hour. [laughter] [applause] but for too many of our kids those days sadly do not ring

a bell. this is an issue that should unite us these are our children in they will have to vote whose sid sid your chairs and to stand at this podium. how can we expect them to protect the principles on which this country was founded if we're not preparing them for that task right now? it is time to make this right in there is a bipartisan bill called the american civics will. send it to my desk i will sign it immediately. [cheers and applause] it's also time to take charge of our public schools in and take responsibility for their results. for too long the federal government has forced one-size-fits-all plot all want our education system.

politicians and bureaucrats on the other side of the country with no an understanding of our state have sought to a improve their standards in there will, and our use. in arizona educational excellence is the priority. for the next four years after the first initiative. [applause] our goal is to improve the classrooms for all children. that is why i propose to spend not lessen the classroom but more. [applause] if right now we spend far

too much on industry did costs and overhead and that has got to change. [cheers and applause] this morning i signed an executive order summoning a team with education and finance professionals charged with looking at every dollar in every formula to identify ways to get maximum dollars into the classroom to do the most good for our children. [applause] we know where a tahitian happens the we will honor teachers and the good work they do. [applause] many teachers will agree that the quality of a child's education is should

that be determined to buy whether their parents can afford to live. [applause] our state has some great public schools. among the best in america but unfortunately because of yesterday's policies committee families are shut out. they sit and wait as sons and daughters get another year old period their dreams to provide them with the best education possible slips farther and farther away. this has gone on too long. i will not except this inequality. [applause] how many errors and the children should have access to the vast public schools? all of them.

[applause] here is what makes this situation more troubling right now there are 400,000 empty seats in the public-school system and summer completely vacant these our educational assets funded by the taxpayer mitt to benefit children and they are going to waste. it is time to put the assets back to work. [applause] so here is the plan. rigo but aroma in parental choice in reality and not just a talking point. open the doors to make those empty seats available to our public schools. by creating the arizona public school achievement

district rekeying give our states the best quality schools there at capacity for have a waiting list. these public schools would have the ability to apply for use of into schools and classrooms to put those kids where they belong in the public-school of the parent's choice. [cheers and applause] we also need to make capital available to public schools that our ready to expand. my budget will reserve resources better best public schools kiev bar against to bring down their cost a and half of the projects funded is is low income communities

[applause] every dollar not spent can go to war classrooms, more teachers or students getting the education they deserve regardless of where they live. [applause] for consistently underperforming schools, it is time for a change in management. this superintendents' principles and operators makes the difference. they're the ones who give our kids a shot at a real education for. so with local control turns into organized chaos to protect bureaucrats, in mitt imagine a united legislate church but expect to make a

change. [cheers and applause] all demanding payment of money that we don't have. elected leaders acted in good faith during the great recession to keep statutory commitments well also keeping the state afloat. and now the courts have given us a choice between a fiscal crisis or a constitutional crisis. so i say to you, the legislature, settle this lawsuit. [applause]

to the education community community, be reasonable to put this behind us. it is time to stop paying lawyers and start paying teachers. [cheers and applause] but dustoff your dictionary and help us sell. the words of the statutes are cleared and in the means and, oh our means or.

[cheers and applause] of course, to improve the life of arizona's children won't end when they leave the classroom. too many kids by themselves in difficult really situations because dad to not being dad's. so i have a message from the view out there, when the authorities know find him in a whole him to his responsibilities with the full force of law. [applause] you are old enough to father a child in arizona you were old enough to assume financial responsibility for that child. for single moms being stiffed by deadbeat dads you need to know we're on your side and help is on the way.

[applause] with all of this renewed focus of opportunity is worth remembering the best can be opportunities to serve. in november launched an effort during the holiday season called serving arizona to highlight a volunteer charitable efforts throughout this day. visit these food banks and shelters you will see those that are struggling the most. also the best of our state. people taking a little bit of time to help those most in need. serving lunches, packing food baskets, reading to a child, whatever it is these arizonans are an example to those of us elected to

represent them. christmas has come and gone but serving arizona has not. giving to charities is a good thing but there is nothing like giving your time and i hope with this effort to encourage that spirit. [applause] our state is not without its challenges when we have the leadership to reach our full potential claim not just talking about in this capital but the leadership of all arizonans. the mom who does everything she can to make sure her children have the opportunity she didn't. ended to chase her dreams. the teacher who will stay late tonight to help tutor one student.

this is about all of us. we all have a stake to make this date the best place in america. in less than a month we will host the super bowl for the third time. as a sports fan i am pretty excited. . . a a chance for everyone in the world to no what we no that arizona is the place to be. [applause] members of the legislature i am grateful for this chance we have to do good for our state. this is why the people sent this year. so let politics stand down for a while. l