captioning performed by vitac he was in bad shape. and he went to them and they just turned him down. and as i remember the story, they looked at each other and said, no, you've got the wrong people. you never came to anybody. and he said something like if you don't understand how you should be treating people, not me but the mesa of people like

me, then you should go straight to hell. that's all. that's all i remember. and so i keep bringing it back and forth and saying that's our mission, we saw on television what they think about us as a people, the republicans have named us and thank god you are partners and i feel so proud as i walk out here. i like to say that in three months this is the first day i tried to do it without a cane. thank you. [ applause ] >> we certainly want to thank the congressman. come on. as you remain standing, let me thank all of you for sharing. we have another full day tomorrow.

tomorrow night is our awards dinner. we want to ask you, please, with honoring james tomorrow night, one of the honorees tomorrow and we are asking you to please make sure you get your ticket for tomorrow's dinner. the bus is leaving. >> just a couple of minutes left in this event. you can see it in its entirety. go to our web site at c-span.org. going live to capitol hill where this morning former governor jeb bush testified before the committee on paul ryan's recent federal budget plan. both ryan and the former governor have been mentioned as potential vice presidential candidates.

the committee will come to order. i welcome all to the house budget committee for this hearing on one of the keefe threats posed to our free enterprise system, the growing cronyism in washington and government imposed barriers to upward mobility. while we dealing with tough economic times, americans still live in the most prosperous and dynamic country in the world. our free enterprise system has lifted millions from poverty. over the years both political parties have pursued

deficit-driven spending aids and favored companies, tax carve outs for the well connected and regulatory barriers that stack the deck against the average citizen. this create as rigged game where success is determined too often not by the quality or service a business provides but by relationships with those in power in washington. both parties share the blame and i believe most parties must work together to advance solutions to get us back on track. to that end we passed a budget here in the house that lifts the debt and strengthens the safety net for those who need it and eliminates corporate welfare for those who don't need. our pro-growth tax reforms ensure a level playing field for all to prosper. the president's calls for wasteful spending on political allies and regulatory monday strostories that protect the

entrenched. in europe, mass of spending, high taxes and corporate favoritism have burden the continent with crushing debt loads and economies unable to grow. america is not destined to share this future if we give the people the freedom to succeed and prosper. today's hearing is an effort to advance how we can master today's challenge. we can and must restore america's exceptional promise, ensuring all citizens are guaranteed the freedom to pursue their dreams. i want to thank our three witnesses for joining us today. first of all, we have former governor jeb bush of florida. thank you very much for traveling with us today. it's great to see you, governor, with us today. you've been an outspoken advocate on restoring governor's proper role so all americans,

especially the least among us, have the opportunity to rise. we have chris edwards, a long-time advocate for fair and simpler tax code and his insightful criticism of the massive subsidies and special interest favoritism that now pervades washington spending and the tax code. then we will be joined with henry waxman. he has a previous engagement. he'll show up hope flip by the time our opening statements and the two witnesses are done. henry is the ranking member of the energy and commerce committee. he's been a strong leader for his party and he's the minority witness today. when the two gentlemen are done, we'll go with henry, hopefully he'll be here by then. >> i want to join the chairman in welcoming our witnesses here today. and let me start from a place we all agree. we all love america, we all believe america is a unique and

special place. we all believe in american exceptionalism. the question is how do we keep america strong, dynamic and exceptional. on that we clearly have different views and would make different choices. we believe that our strength comes not only from the undisputed benefits from people being able to pursue dreams but harnessing those talents for america's purposes. not only from a collection of individuals act ago loan for private profit but also from our capacity to work together as americans for the common good. we believe in constantly expanding the circle of opportunity so all americans have the chance to prosper. and, mr. chairman, i must confess and governor bush, i must confess, i'm a little surprised that you decided to be here today to criticize the efforts made over the last three

years to lift the economy out of the mess that president obama inherited. for eight years the president bush pursued a failed ideology of trickle-down economics based on a theory that tax cuts for the very wealthy and an anything goes license on wall street would boost our economy and lift all boats. well, it lifted the yachts but the rest of the boats ran aground. the financial crisis hit and the economy and jobs went into freefall. by the end of those eight years america experienced a net loss of private sector jobs back when president bush left office we were losing jobs at the astounding rate of over 830,000 jobs a month. americans' retirement savings collapsed by one third, trillions of dollars between 2007 and the day president bush left office. our nation's fiscal health saw the greatest reversal in

american history from large projected surpluses to large projected deficits. now, i've searched the record and as far as i can tell during that eight-year period did you not challenge the bush administration's handling of the economy, criticize the excessive spending or the rising deficit. and now i was looking at your testimony, i'm looking forward to hearing it in full, you're here to tell us that government actions have prevented us from the kind of, quote, snap back economic recovery that we have seen in other post world war ii recoveries. carmen reinhart and kenneth rogoff, two very distinguished economists who are often cited by chairman ryan have demonstrated that economies hit by systemic fiscal crisis don't snap back within a year or two

but take significantly longer to recover. the tarp bill was of course a huge government intervention in the marketplace called for by president bush, supported by now speaker boehner, now chairman ryan, governor romney, then senator obama and many of us on a bipartisan basis as a distasteful but necessary action to prevent a total financial meltdown with devastating consequences for the economy. but even with the rescues of the economy, main street was feeling the pane as millions of americans were losing their jobs. we all know what the figures were.

839,000 jobs lost per month. as i say, the economy was headed down at a very rapidly collapsing rate of 8.9% negative gdp. so when the president was sworn in, he was determined to take action to help those americans being hit by the economic tsunami and he believed that if we adopted president bush's proposal for government action to rescue wreckless banks who help precipitate the crisis, sure live we should be willing to take action to help millions of americans thrown out of work through no fault of their own. so president obama and the early congress passed the economic recovery act, which the nonpartisan experts at the congressional budget office have concluded has created or saved up to 2 million jobs in 2010 alone. the president also believed that if we had rescued the bank, sure live we should prevent the u.s. auto industry from being wiped out, an action that saved millions of jobs.

this was not about crony capitalism, as the chairman has suggested. it wasn't about doing special favors for well connected friends. it was about ensuring that a critically important industry in this country had a reasonable opportunity to survive given the financial crisis going on around it. now, governor romney has famously suggested that we should have let detroit go bankrupt, that the crisis should have been handled through the normal bankruptcy process. bob watts, former general motors vice chairman who also happens to be a republican took umbrage with this and said and i quote "it's once again the fiction that, ah, we didn't need the government and this could have been a privately run bankruptcy with the normal chapter 11. what these people always deliberately forget is there was no money. nobody had money." and so when the chairman and others refer to this as crony

capitalism, i think many of us take great offense. we also passed the wall street reform bill to make sure that never again would reckless gambling on wall street wreak havoc on main street and leave taxpayers holding the bill. i will wrap up in a minute, mr. chairman. i would just like to point out, governor, that during that period of time we weren't getting very much help from our republican colleagues, not a single republican house member voted for the recovery bill, not a single one voted for the wall street reform bill. senator mcconnell, the senate leader in the senate in a moment of candor said, and i quote, "the single most important thing we want to achieve is for president obama to be a one-term president." so we have made progress on improving the economy.

are we where we want to be? absolutely not. and today's jobs numbers show we need to make further progress. but let's learn the right lessons from what happened in the past because if we diagnose the problem wrongly, then we'll have the wrong prescription. i do worry greatly about those who say the way forward is to adopt a souped up version of many of the policies that got us in the mess to begin with. so as we go forward, i hope we will try to find a way together, and i'll just close with where i began on the point of agreement, mr. chairman. if there is a government program that's not achieving its intended purpose, let's amend it or get rid of it. we agree. if there's a regulation that's outlived its usefulness, get rid

of it. i hope we would adopt the same approach with respect to special interests tax breaks. if there's not a use or purpose -- >> finish up. >> i am, mr. chairman. let's again remember that we've made some progress and we need to make more. let's not misdiagnose the problem and learn the wrong results. >> i now know why the opening statement was so long. mr. waxman just arrived. okay, i get it now. chairman -- congressman waxman, welcome. please take your seat. we preannounced you already. mr. van hollen was just explaining how upset he is that governor bush is here with us today. we see things a little differently i guess. >> you want to tell him how excited you are that i'm here? >> i'm very excited to have you. some of us wanted to have a brief opening state and get to

the witnesses. why don't we go with governor bush, mr. edwards and congressman waxman. governor bush, please. >> governor ryan, ranking members van hollen. it is a joy to be here. i didn't come to criticize anybody, just for the record. i came to share my views. i'm not used to the 9:00 food fight that starts bright and early around in washington. i'm from florida where we don't start that way in life but it's great to be here. i'm here to talk a little bit about what i think is an important subject as we try to recover. the may job numbers were anemic at best. no one could be satisfied with that. we do have an l-shaped recovery and it's the first since world war ii where we've not had a robust recovery. there's a cloud over our country, i think, that relates to this growing pessimism that we can't restore the vitality of

our economy in a way that creates opportunities, more and more people are becoming more dependent on every level because of it. i think it's important for this economy and for policy makers in washington to reflect on that and to figure out how together republicans and democrats we can restore the right to rise in our country and restore a sense of optimism to begin to rebuild our country. i don't question the intentions of people at all. i think there is a shared belief that we need to do better. the question is how. and what do we need to do in this chamber and state capitals to improve the outlook for job creation, business expansion and overall prosperity should be the dominant question across our country. and i would urge you to look carefully at your primary responsibility, which is to manage the budgetary affairs of the united states government. that's a good place to start. at 3.8 trillion dollars, the

u.s. budget is a powerful force in the united states economy. its sheer size means entire industry, whether heavily regulated or not operate in constant awareness of what you all do here. when you combine this budgetary power with the separate powers of taxation and regulation, the federal government wields significant influence over the economy both directly and indirectly. it's not an overstatement to say that right now. the united states economy operates significantly at the direction and behest of of the united states government, not the other way around. in many cases the government's growing size and influence was made possible by good intentions and hopeful policy ideas. behind every spending program, tax incentive and regulation, there's an idea. it might in fact be a good idea, but those good ideas and the not so good ones add up and the cost of everything you do here, every line item, every rule, every carve out, phase out, ear mark

drains activity investment and creative effort out of the private sector of the economy. that's why my best advice is for you to perform a fundamental cost benefit reconsideration of many programs of the federal government and consider the u n unintended consequences of your actions and cumulative effect of your actions. there are 49 job training programs in our country today. i wonder about that number. what do we ambassador taxpayers get from 49 job training programs than 29 or 39 or 6 could accomplish? how do we know the people are choosing the right job training programs? how do we know that the right people are running those programs? should all of these programs be packaged and sent down to the states to allow the laboratories of democracies to work more effectively so can you benchmark success and then develop a 21st century strategy as it relates to job training? do these 49 job training

programs operate with any sense that they should or could be closed if they fail? this is the daily worry of american businesses in our country. but these programs don't worry about being put out of business. i wonder whether federal job training programs keep someone in the private sector from building a business around providing skills training and whether that person might do a better job. in short, when you try to solve one problem, you may not only fail but you may create several others. now, if you multiply that one example across the economy in multiple industries and multiple ways, it's not hard to see what will happen and it has happened. so not only does the government grow bigger to every program it, also displaces the private economy, the innovators, the inventors, the people who risk their own savings on a business idea, the established businesses who couldn't grow but don't. we see this in spending programs and we see it in taxing programs as well, tax policies that

advantage certain economic activities and are just another form, in my opinion, of government spending and subsidy and while they grant to some companies and industries benefits, they also tend to disadvantage other companies and industries. this is a matter of fairness. why should a company pay tax toes to support government subsidies that go to one of their competitors? there may be political support for specific industries and companies but we know from recent experience that the government not good at picking winners and losers in the economy and fundamentally it's not the job of the government to pick winners and losers in the economy. again, i recognize why government tries to control the marketplace by sheer power and size, i recognize it's because -- i've become clearer about this in my postgovernorship life because i see it in the private sector as well, there are countless examples of great companies who

fail to move with the market because a smaller and more nimbler competitor arrives first with the winning selection. in the private sector when a big company is beaten to the punch, it either gets lean fast and adapts or it goes out of business. we should remember, by the way, that failure is part of the natural part of a competitive market and when government tries to intervene to eliminate the possibilities of failure, they actually end up creating more of it rather than to allow the more innovative approach to work. the problem with government involvement in the economy is that it does not go through the same process of innovation and sometimes failure that exist. none of us will allow government to fail. what would occur in most private organizations and institutions, failure followed by defunding, simply doesn't happen here and i was delighted to hear congressman van hollen's approach that maybe it should given and that is a place where i think there is huge common ground. if programs don't work, defend

them and allow for others to come in their place or not exist at all. i want to return to the rational behind some a process. this is not about making government more efficient, it's been making government a smaller part of our economy. we have to ask ourselves whether the status quo and expensive and unaffordable status quo is the best way to address the problems that congress has set itself up to solve and i believe that there are many better approach toes that and i thank the committee for its attention to these issues and look forward to answering your questions. >> thank you. mr. edwards. >> thank you very much, chairman ryan and ranking member van hollen for inviting me to testify today. i'm going to talk about corporate welfare, entrepreneurs and economic growth. i'm going to discuss four reasons why corporate welfare is

bad and i'm going to talk about the real solution to u.s. economic growth, which is unleashing entrepreneurship. the first reason why corporate welfare is bad is it costs money. we have trillion dollar deficits right now. we can't afford corporate welfare or business subsidies. i estimate business subsidies are about $100 billion a year it's a small part of the federal budget but it's a good place to start cutting. farm subsidies are in my view like a reverse robinhood program. farm household incomes on average are 25% above the u.s. average and in my view it's unfair and takes from average folks to give to higher income folks. well meaning policy makers want to support businesses because they believe subsidies will make them more competitive.

i think subsidies back fire. for example, on energy subsidies, we've been subsidizing energy for four decades and it has been boondoggle after boondoggle. go all the way back to the 1970s. you had a giant project called the clinch river breeder reactor, which was a boog doingle in the 70s, it wasted billions of dollars and was a failure. and you had a democratic boondoggle, the synthetic boone corporation started under jimmy carter. this is a bipartisan problem. i think business subsidies change the behavior of businesses. businesse businesses, for example, get more spend thrift.

you saw that with solyndra, they builted a big company, spend thrift companies would not do that. they invest of companies that blow up. enron received $3.7 billion in subsidies from other federal programs. that induced them to invest in all kinds of hair brain foreign investment projects, such as a power plant in india. it would not have done that risky foreign investing without the federal subsidies and all those foreign investment projects that enron took part in came crashing down. subsidies induce bad decision making by businesses and corporate welfare generates corruption in my view, federal business subsidies have always generated corruption and go all the way back to the first transcontinental railroad in the united states. that generated a huge subsidy

scandal in the 1870s. more recently go to ronald reagan department of housing and urban development. it overflowed with corruption as the secretary at the time handed out business subsidies to his friends and republican party donors. go the 1990s, i believe president clinton's commerce department undersecretary ron brown also overflowed with corruption. he handed out business subsidies in return for campaign contributions to the democratic party. so this is a bipartisan problem. so corporate subsidies don't work. so what does? what can we do to spur growth? we should unleash entrepreneurs. most of america's economic growth historically has not come from government and it hasn't come from big established companies. it has come from new businesses creating new industries and you can go back and look, as i have, at american economic history. the electricity industry, internal combustionin gins, automobiles, aircraft,

electronics, cell phones, personal computers, biotechnology, those are all new industries created by upstart entrepreneurs, not by established businesses. so helping getting out of the way of entrepreneurs i think is the most important thing we can do for the economy. i'll give you a couple of examples. the modern telecommunications revolution in large part is the result of nci corporation battling during the 1970s to compete against the at&t monopoly. federal express created a revolution in package delivery by battling against regulation in the 1970s. remove business subsidies, tear down barriers to entrepreneurs and i think we will unleash more economic growth. a few quick examples, i think repealing farm subsidies would spur innovation in the agriculture industry like it has in new zealand. repe